The SEC dropped its case against Consensys today, no longer claiming that the Metamask wallet violates securities regulations. Consensys’ CEO Joseph Lubin extended an olive branch to the Commission.
This is the sixth legal action dropped against crypto firms in a week, but the Commission remains silent on its biggest case – the XRP lawsuit. However, the SEC today hosted a closed-door meeting meeting about active enforcement cases, and Ripple could have been a major focus.
MetaMask and Coinbase Bury the Hatchet with the SEC
Despite its desire to lower enforcement actions, the SEC remains one of the top financial regulators in the US. Lately, it’s been dropping major enforcement lawsuits, like the one against Coinbase, and attempting to settle another case with Tron.
Today, the SEC is winding down its action against Consensys, specifically concerning the firm’s Metamask wallet.
“I’m pleased to announce that Consensys and the SEC have agreed in principle that the securities enforcement case concerning MetaMask should be dismissed. Subject to the approval of the Commission, the SEC will file a stipulation with the court that effectively closes the case,” Consensys founder Joseph Lubin said via social media.
Metamask, Consensys’ Ethereum-based wallet solution, drew the SEC’s ire for allegedly violating securities laws, leading to a lawsuit.
Despite the bad blood between the two, however, Lubin struck a conciliatory tone with the Commission, saluting “the SEC’s new leadership and the pro-innovation, pro-investor path they are taking.”
Consensys doesn’t seem to have any lasting resentment towards the SEC, but that’s not true across the board. Yesterday, the Commission dropped its investigation into Gemini, whose co-founder Cameron Winklevoss demanded harsh penalties.
Will this Impact the Ripple Case?
It’s all well and good that the SEC and Consensys want to bury the hatchet, but it doesn’t answer the industry’s most burning enforcement question. As one analyst pointed out, one open lawsuit is on everybody’s mind: will the SEC drop its fight against Ripple?
Crypto Twitter is flooding the SEC’s posts with comments about the Ripple lawsuit. This is not surprising given it’s the Commission’s legal action in recent history, and it’s been going on for over 3 years now.
Crypto Enthusiasts Demand SEC v Ripple Answers. Source: James Seyffart
The SEC v Ripple case is arguably Gary Gensler’s most significant enforcement action, with much deeper consequences than the Consensys suit.
Recently, the Commission attempted to stall the suit’s progress, but it hasn’t made many public statements since. For the most part, the community is in the dark.
Nonetheless, there are a few vital clues. As one reporter noticed, the SEC had a closed meeting this afternoon. Earlier this month, it consulted industry leaders about ETP staking, and these talks have already proved influential.
Today’s meeting agenda included “resolution of litigation claims and other matters relating to examinations and enforcement proceedings.”
In other words, the Commission may be consulting with the crypto industry, attempting to wrap up its active investigations and lawsuits from the Gensler era.
For now, there is not one shred of proof that it will drop the Ripple case any time soon. Based on current trends, however, it seems extremely likely that the SEC will continue to settle or drop all enforcement actions against crypto companies.
So, for the XRP community, it’s likely a matter of when, not if.
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