SEC Sues Consensys For MetaMask’s Swap And Staking Features

The U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Ethereum infrastructure provider Consensys on Wednesday for allegedly failing to register key services offered in its MetaMask software wallet.

The SEC lawsuit comes two months after Wells issued a notice to Consensys expressing the agency’s intent to file a lawsuit over the popular Ethereum wallet, which website It claims to be “trusted by over 100 million users worldwide.”

Next SEC target: Consensys

in press release On Wednesday, the SEC alleged that Consensys engaged in “the offer and sale of unregistered securities” through its MetaMask Stakng service. This included “tens of thousands of unregistered securities” on behalf of both Lido and Rocketpool — the liquid storage providers with which Lido is integrated.

Meanwhile, both MetaMask Scking and MetaMask Swaps allegedly made the company an “unregistered broker,” by providing investment information on crypto assets, facilitating trades, and collecting “hundreds of millions of dollars in fees as an unregistered broker.”

“Consensys has directly inserted itself into the U.S. securities markets while depriving investors of the protections afforded by the federal securities laws,” Gurbir S. Grewal, director of the SEC’s Enforcement Division, said in an accompanying statement.

Earlier this week, the SEC closed its investigation into Consensys regarding Ethereum 2.0 and its potential status as an unregistered security. Experts believe that the agency’s recent approval of Ethereum ETFs is a de facto admission that Ethereum is legally a commodity that falls outside the SEC’s purview.

But the cryptocurrency giant’s battle is not over yet. Before Friday’s announcement, Consensys filed a lawsuit with the Securities and Exchange Commission seeking a court declaration that its storage and swap services do not violate securities laws.

Nothing new for the SEC

The SEC also targeted Uniswap Labs — the creators of the largest decentralized exchange for Ethereum — on similar grounds, though Uniswap criticized the justification for its notice to Wells as “weak.”

The agency also sued Coinbase for offering unregistered brokerage services through both its centralized exchange and Ethereum-based mobile wallet application. However, the allegations regarding the Coinbase wallet have already been denied.

In a Twitter post on Friday, Consensys called the SEC’s lawsuit against it “the latest example of its regulatory overreach.”

“We will continue to vigorously pursue our case in Texas to resolve these issues because they are important not only to our company but also to the future success of web3,” the company said. He said.