Ethereum News Today: SEC Chairman Clarifies Ethereum Not a Security, Price Surges 25%

Paul Atkins, the chairman of the US Securities and Exchange Commission (SEC), has clarified that Ethereum is not considered a security. He stated that securities laws will not apply to Ethereum, although the SEC has yet to take a formal stance on the matter. According to Atkins, the SEC is informally classifying Ethereum in the same category as Bitcoin, branding them as commodities. He emphasized that the ETH blockchain is a very key component for a lot of other digital currencies and has created the foundation for many cryptocurrencies. Therefore, it cannot be removed from that bracket.

Atkins also highlighted the freedom that companies have in deciding where to allocate their funds and what strategies to employ. He believes that this freedom will provide a good future for development in the sector. This statement comes at a time when several companies are increasingly incorporating Ethereum into their treasuries. For instance, Bit Digital transitioned from a Bitcoin-only treasury to an Ethereum-only treasury over a three-month period. The company sold 280 BTC and raised approximately $172 million through an underwritten share sale before purchasing additional ETH. SharpLink Gaming also disclosed that it now holds 280,706 ETH, making it the largest known corporate position in Ethereum. Between July 7 and July 13, SharpLink purchased 74,656 ETH at an average price of $2,852, with 99.7% of its holdings staked, generating 415 ETH since June 2. Chairman Joseph Lubin framed this reserve strategy as “collective capitalism” built on a permissionless network.

Atkins' remarks come at a time when institutional investors are embracing ETH. He acknowledged the trend of corporate entities embracing ETH and other cryptocurrencies is “encouraging.” He added that the soaring institutional interest predicts a “good future” for development and innovation in the sector. This news comes at a time when institutional investors are embracing ETH. Growing institutional confidence could define the next bull run. ETH ETFs are set to attain new all-time highs to catch up with Bitcoin ETFs after just breaking a new daily record for inflows. The news has increased Ethereum’s price to $3,782, making it the biggest altcoin to rise more than 25% in the last week.

In May, it was revealed that the New York State Attorney General asked the SEC to openly declare that Ethereum was a security, not a commodity, during the state’s prosecution of KuCoin in 2023. Shamiso Maswoswe, chief of the Investor Protection Bureau for the New York AG, said, “We would like to request that the SEC file an amicus in support of the argument that Ether is a security.” She added, “Whether it is or not will not be dispositive in our case (we have authority over both securities and commodities) — but I think it would be beneficial to investor protection to get a court to hold that Ether is a security.” This was going to drag Ethereum to a path well known by Ripple. Initially, the SEC sued Ripple, claiming it raised over $1.3 billion through unregistered XRP sales. It classified XRP as a security. Since then, the legal battle has created uncertainty, impacting investor confidence and hindering XRP’s adoption. In addition, several exchanges delisted or suspended XRP trading due to the SEC’s claims. A coin that had great potential ended up being average. However, with all the strain, the coin remained at the top although its competitors ended up too far off.

Atkins also addressed the regulatory landscape, noting that recent federal attention to stablecoins represents a “stamp of approval” that could enable near-instant delivery versus payment for securities. He argued that on-chain settlement using regulated, dollar-backed tokens can lower counterparty risk and transaction costs across US capital markets. The interview also covered retirement plans, with Atkins stating that individual investors continue to seek exposure to private funds, including digital asset strategies, inside 401(k)s. He urged collaboration between the SEC and the Department of Labor to establish valuation, liquidity, and fee standards, which would enable fiduciaries to offer registered products to long-term savers. Atkins emphasized the importance of ensuring that individual investors rely on fiduciaries for their investment decisions.