Ripple CTO Questions SEC’s Stance on Ethereum (ETH) Security Classification

After Slamming Charles Hoskinson over his defense of the SEC’s views on Ethereum (ETH) over other projects, Ripple’s Chief Technology Officer, David Schwartz, has raised an eye-opening question to the U.S. Securities and Exchange Commission (SEC) concerning the security classification of Ethereum (ETH), the second-largest cryptocurrency by market capitalization. 

Schwartz’s query transpired from the recent fake news of the SEC-approved BlackRock’s application for a spot Bitcoin exchange-traded fund (ETF). This news created a ripple effect in the market, leading to an instant surge in the prices of significant digital assets, including Bitcoin, which saw a spike of over 10% and halted at $29K. However, this initial rally was short-lived as it was revealed that the news was based on misinformation. This correction prompted a rapid retraction of crypto prices back to their previous levels. 

In response to this, the SEC issued a stark warning urging the public to exercise caution when consuming information from the internet, emphasizing that the most reliable source of information about the SEC is the SEC itself.

Ripple CTO Exposes SEC’s ETH Liking with Facts

David Schwartz took this opportunity to pose a pertinent question to the regulatory agency. He inquired whether the act of crypto traders selling ETH on digital exchanges could be interpreted as a transaction involving securities. Schwartz expressed his desire to receive an official response from the SEC, emphasizing the Commission as the ultimate authority. As of the time of writing, the SEC has not yet addressed Schwartz’s inquiry.

This question from Schwartz carries significant weight due to the ongoing legal battle between the SEC and Ripple. In this lawsuit, the SEC alleges that Ripple’s systematic sales of XRP on digital exchanges constitute an investment contract falling under the category of securities. Although a federal court ruled in favor of XRP, determining that secondary market sales did not infringe securities laws, the SEC maintains its stance, asserting that the decision raises pivotal legal questions.

SEC’s Delamma Starts From Here…

David Schwartz’s inquiry regarding the security status of ETH comes in light of the belief within the crypto community that the SEC has been particularly favorable towards Ethereum. Despite current SEC Chairman Gary Gensler reiterating that Bitcoin is the only cryptocurrency unequivocally outside the SEC’s regulatory scope, suspicions persist regarding the SEC’s stance on Ethereum, fueling the ongoing discussion within the crypto community. 

While Bitcoin approvals will open the market for Bitcoin, it will also clear the XRP path for future rallies. If $16 billion flows into the ETF market, history suggests a potential 4% Bitcoin price surge, taking it beyond $37,500, says analyst Crypto Researcher.