The upcoming 2024 election could have a significant impact on how the United States Securities and Exchange Commission (SEC) approaches crypto-related policies, as suggested by Consensys’ senior counsel. Speaking at the Consensus conference in Austin on May 29, Bill Hughes, Consensys’ senior counsel and director of global regulatory matters, highlighted the uncertainty surrounding the influence of changing political and regulatory dynamics in the U.S. on the firm’s ongoing lawsuit against the SEC regarding Ether (ETH).
In recent weeks, lawmakers have been pushing for legislative clarity on SEC regulations, with the commission approving the establishment of Ether exchange-traded funds for the first time. Both major party presidential candidates have also included digital assets in their pre-election agendas.
Hughes expressed optimism about the approval of spot Ether ETFs, stating that it was a positive development that should not have been controversial. Consensys had previously filed a lawsuit against the SEC and its commissioners in Texas, alleging plans to classify ETH as a security and citing concerns over potential enforcement actions related to their MetaMask products.
However, the lawsuit preceded the SEC’s approval of 19b-4 filings for asset managers seeking to list and trade spot Ether ETFs on U.S. exchanges, indicating a recognition of ETH as a commodity. Despite this, the SEC had initiated a formal investigation into Ether as a security, leaving the impact of the political landscape on the commission’s decisions uncertain.
Hughes speculated on potential actions by the SEC in response to political pressures, particularly in light of the pending FIT21 Act that aims to clarify the SEC’s role in regulating digital assets. He emphasized the need to closely monitor how external pressures might influence policy decisions within the SEC.
Chair Gensler hinted on June 5 that the SEC would take time to approve registration statements for asset managers applying for spot Ether ETFs, with expectations of a potential launch date on July 4. The evolving political landscape and the potential implications on the SEC’s decision-making processes remain a subject of speculation among industry experts and legal analysts.