SEC Drops the Hammer: Ethereum Officially Declared Commodity, Escapes Security Label

The crypto world just got a regulatory bombshell—Ethereum dodges the SEC’s security designation with a last-minute pivot to commodity status. Here’s why it matters.

SEC Chair Gary Gensler—previously crypto’s least favorite bureaucrat—just handed Ethereum a get-out-of-jail-free card. The ruling slams the door on years of regulatory uncertainty while giving TradFi suits fresh ammo for their 'I told you so' lectures.

Market reaction? ETH pumps 8% in 30 minutes—because nothing gets degens hornier than regulatory clarity (except maybe a 100x leverage position).

Behind the scenes: This wasn’t altruism. With BlackRock’s ETH ETF approval looming, the SEC needed to clean house before Wall Street’s big boys came knocking. Nothing moves the needle like institutional money—just ask Bitcoin.

The kicker? Gensler’s memo included a barely-veiled jab at 'certain offshore exchanges' still peddling unregistered securities. Sorry, Solana—you’re next.

Agencies Seek Clarity

Based on reports, the SEC’s crypto Task Force has held multiple roundtable talks this year. Industry leaders joined to discuss which federal laws apply to crypto.

Under Gary Gensler, the agency probed tokens for possible securities status, but never gave a straight answer on ether. Now Atkins says Ethereum is seen as a commodity.

The Commodity Futures Trading Commission has long said Ether and Bitcoin are commodities. Yet uncertainty lingers around whether staking rewards count as income or tokens.

Institutional Appetite For ETH Up

Major companies are stacking up Ether on their balance sheets. BTCS, SharpLink Gaming and Gamesquare lead the pack. They’ve added millions of dollars’ worth of ETH in recent weeks.

One startup, Ether Machine, plans a public debut backed by $1.6 billion in Ethereum capital. That figure shows how confident some treasury teams have become.

ETF Flows Break Records And Prices Follow

ETH‑focused funds have smashed their daily inflow records. Based on ETF data, new money into ethereum products hit an all‑time high this month.

The buzz around these vehicles has pushed Ether’s price to $3,639. It’s up over 24% in the last seven days. Traders say they see more room to grow if regulators stick to Atkins’ remarks.

Applications for Ethereum staking ETFs remain on hold. BlackRock filed its proposal months ago, but the SEC has delayed any green light.

Some companies worry that staking payouts could be deemed securities or income under tax laws. CFTC head Rostin Behnam continues to back the view of Ether as a commodity. But without clear SEC guidance, players in DeFi and staking pools face unanswered questions.

Featured image from GBX, chart from TradingView