Joseph Lubin accuses the SEC of impeding innovation in the US financial sector, citing Consensys’s lawsuit following a Wells notice.
Joseph Lubin, co-founder of Ethereum, thinks that the deliberate obstruction of innovation by the Securities and Exchange Commission (SEC) poses a threat to the current financial environment in the United States.
Lubin elaborated at the FT Live Crypto and Digital Asset Summit in London on Consensys’s decision to file suit against the SEC after receiving a Wells notice from the U.S. securities regulator.
“The SEC appears to have reclassified Ether as a security without telling anybody that that’s the case. They are going about a strategic series of enforcement actions rather than open discourse and clear rulemaking,”
Lubin said.
The enforcement actions are intended to sow dread, uncertainty, and doubt throughout the cryptocurrency industry “in an attempt to paralyze” and force the company offshore, according to the CEO of Consensys, the developer of the MetaMask wallet.
Lubin stated that their retaliatory action against the SEC is intended to obtain greater clarity from U.S. courts, given that Ether was previously classified as a commodity by the Commodity Futures Trading Commission (CFTC).
The forthcoming deadline for the SEC to render a determination regarding the authorization of Ether spot exchange-traded funds (ETFs) was also cited by the CEO of Consensys as a motivating factor for the regulator’s recommenced enforcement measures against Ethereum.
“We believe that there’s a flurry of activity designed to enable them to say that their action wasn’t capricious in the very likely event that they deny the Ether spot ETFs,” .
Lubin explained
Lubin stated that the SEC had become aware of the amount of capital that had flooded into the ecosystem since spot Bitcoin ETFs were approved:
“I think they’re concerned that so much attention and capital will flow to our ecosystem, considering it is improving enormously in terms of scalability and usability.”
The potential ramifications of a favorable resolution regarding the SEC may extend to the cryptocurrency and technology sectors within the United States.
According to Lubin, the SEC’s allegations that the wallets of MetaMask and Coinbase are acting as broker-dealers set a dangerous precedent. Furthermore, he stated that the concept of software functioning as a broker-dealer was “irrational.”
“We’re at odds over whether we should register MetaMask as a broker-dealer. Should ever MetaMask user have to register their wallet as a broker-dealer, it’s chilling,”
Lubin added.
The CEO of Consensys concluded that the actions of the securities regulator could affect the entire technology industry in the United States.
