IMPORTANT POINTS:
- Ethereum Classified as a Commodity by Brian Armstrong: Drives approval of ETFs.
- Classification Debate between SEC and CFTC: Discrepancies on whether ETH is a security or commodity.
- Potential Judicial Resolution for Ethereum ETFs: Analogy with the case of Bitcoin ETFs.
Brian Armstrong, the CEO and co-founder of Coinbase, recently expressed in an interview with Bloomberg that, like Bitcoin (BTC), Ethereum (ETH) should be considered a commodity under United States federal laws. This comment takes on particular relevance as the US Securities and Exchange Commission (SEC) considers several applications to launch Ethereum exchange-traded funds (ETFs), following the approval of Bitcoin ETFs earlier this year. anus.
The Importance of Ethereum Ranking
Ethereum’s classification as a commodity is crucial as the SEC evaluates applications to launch ETH-based ETFs. Armstrong argues that given the SEC’s approval of Bitcoin ETFs, Ethereum ETFs should also be approved without delay. However, he notes that there is a disagreement between federal agencies over whether Ethereum should be classified as a security, which could complicate the approval process for these funds.
Conflict between Federal Agencies
While SEC Chairman Gary Gensler has suggested that many digital assets other than Bitcoin could be considered securities, the US Commodity Futures Trading Commission (CFTC) has noted that Ethereum is a commodity. This divergence of opinion between the CFTC and SEC has led to a debate over the legal nature of Ethereum, and according to Armstrong, this has politicized some cryptocurrency-related decisions at federal agencies.
Possible Resolution in the Courts
Armstrong suggests that, as was the case with Bitcoin ETFs, approval of Ethereum ETFs could require court intervention. He recalls a case in August, when a court determined that the SEC acted “arbitrarily and capriciously” in rejecting Grayscale’s application to convert its Grayscale Bitcoin Trust (GBTC) into a spot ETF. This court decision was cited by Gensler as a crucial factor in approving applications for spot Bitcoin ETFs.
The Coinbase leader believes that if the approval of Ethereum ETFs is unfairly delayed, the industry may have to follow a similar route, turning to the courts to force regulators to follow the rules and ensure equal treatment under the law. Armstrong concludes that Ethereum ETFs should be approved immediately, reflecting his confidence that Ethereum, like Bitcoin, is a commodity under US federal law.
