Newly released documents show that the Office of the New York Attorney General (NYAG) urged the U.S. Securities and Exchange Commission (SEC) to classify Ethereum (ETH) as a security during the regulatory probe into cryptocurrency exchange KuCoin in 2023. The NYAG’s push for clarification was detailed in an email from Shamiso Maswoswe, chief of the Investor Protection Bureau at the NYAG’s office, addressed to the SEC Chair Gary Gensler’s chief of staff.
In her email, Maswoswe requested that the SEC submit an amicus brief supporting the argument that ETH should be officially identified as a security. Although she admitted this clarification was not essential to New York’s enforcement efforts — as the state regulates both securities and commodities — she argued that an explicit judicial ruling recognizing ETH as a security would strengthen protections for investors.
Despite the NYAG’s request, the SEC ultimately declined to submit such a brief. To date, the regulator has maintained an unclear stance on Ethereum’s classification. Historically, the SEC appeared to lean towards identifying Ethereum as a commodity. However, speculation about its status grew considerably after Ethereum transitioned to a proof-of-stake consensus model. Yet, despite ongoing scrutiny and industry discussion, the SEC has refrained from definitively classifying Ethereum as a security.
These details surfaced following the disclosure of documents obtained by Coinbase through a Freedom of Information Act (FOIA) request. The documents highlighted wider internal discussions within the SEC regarding the regulatory status of digital assets, including deliberations about Ripple’s XRP and differentiations between centralized and decentralized blockchain-based projects. Coinbase, through ongoing FOIA requests, seeks to foster transparency regarding regulatory policy around digital assets.
The SEC’s action against KuCoin, initiated by the New York Attorney General’s office, ended in December 2023 after the cryptocurrency exchange agreed to pay a $22 million settlement and cease its operations in the state of New York. Attorney General Letitia James emphasized at the time that the enforcement was part of a broader initiative targeting crypto platforms operating without proper authorization.
