TL;DR
- A Texas court dismissed ConsenSys’ lawsuit against the SEC, as it did not constitute a final action by the agency.
- The court deemed the claim regarding Ethereum irrelevant since the SEC had closed its investigation after approving Ethereum ETFs.
- Despite the dismissal, ConsenSys will continue its legal battle with another lawsuit related to MetaMask Swaps.
A Texas court recently dismissed a lawsuit filed by ConsenSys, the company behind the popular crypto wallet MetaMask, against the U.S. Securities and Exchange Commission (SEC).
The lawsuit, filed in April 2023, accused the SEC of conducting an investigation into Ethereum and warned ConsenSys of possible enforcement actions related to MetaMask’s swap and staking services.
The case sought a ruling from the court declaring that Ether, the native cryptocurrency of the Ethereum network, is not a security, and that transactions made with Ethereum should not be considered securities transactions. Additionally, ConsenSys aimed to halt any future SEC actions against MetaMask regarding these services.
However, Judge Reed O’Connor rejected the company’s arguments. In his ruling, he determined that the SEC’s actions, including warning notifications known as “Wells notices,” do not constitute final agency decisions.
Consensys Will Pursue Another Lawsuit Against the SEC
This means that, although the SEC had warned ConsenSys about potential actions, these do not impose immediate legal consequences nor establish definitive rights. According to the judge, there was not sufficient grounds for the court to intervene at this stage, leading to the dismissal of the lawsuit.
Another significant aspect of the case was the investigation into Ethereum. ConsenSys claimed that the SEC was acting improperly by attempting to classify ETH as a security. However, this claim was deemed irrelevant by the court, as the SEC had already closed its investigation into Ethereum following the approval of Ethereum ETFs earlier this year. That decision removed any prior concerns about classifying Ethereum as a security.
Despite this setback, ConsenSys does not plan to end its legal battle. The company announced that it will continue with a related lawsuit filed in June, accusing the SEC of overstepping its authority by trying to regulate MetaMask Swaps as a brokerage service offering unregistered securities.
The company has voiced its dissatisfaction with what it sees as an “anti-crypto agenda” by the regulatory body, arguing that the SEC is using legal actions to expand its influence beyond the limits established by law.
