Gensler stated that cryptocurrency investors anticipate gains based on the efforts of others, referring to the results of the Howey test. The debates on the long-awaited Merge did not trigger the price action of Ether, which has recently lost its value.
The value of the Ethereum native token Ether (ETH) struggles to break through crucial levels despite the Merge. Meanwhile, a comment from Gary Gensler, the chairman of the US Securities and Exchange Commission (SEC), sparked off a new debate.
According to the Wall Street Journal, Gensler talked about cryptocurrencies and the intermediaries that allegedly allow investors to stake their coins. He reportedly said they could meet a criterion that courts use when deciding whether an asset is a security.
The Chairman of the SEC Continues Supporting the Security Narrative
Following a congressional hearing, Gensler stated that cryptocurrency investors anticipate gains based on the efforts of others, referring to the Howey test.
Staking on Ethereum includes depositing 32 ETH to activate the validation software. The Shanghai upgrade scheduled for 6 to 12 months after the Merge is an essential step toward freeing ETH on staking.
After the Merge, staked and newly produced ETH will remain blocked on the Beacon chain until the activation of the Shanghai upgrade. According to Gensler, staking looks quite similar to lending, although it has some labeling changes.
Federal regulators had already singled out crypto firms like Coinbase, Circle, Gemini, Nexo, and Celsius for their profitable products, generating a discussion on unregistered stocks.
However, cryptocurrency supporters have criticized the SEC, highlighting its compliance settlement strategy and lack of regulatory advice.
The Long-Awaited Merge Did Not Trigger the Value of Ether
The debate on regulatory staking is not the only discussion about the Ethereum Merge. The long-awaited review did not trigger the price action of Ether, which has recently lost nearly 9% of its value.
With a 24-hour range between USD 1,454 and USD 1,641, the second-largest cryptocurrency by market capitalization remains 70% below its high of around USD 4,870.
According to current market data, only 52% of ETH holders still earn a profit. That indicates that only 1% of the owners are in balance while 47% are broke. Despite weak price action, equity and on-chain signals lean toward a bullish market.
The capitalization of the overall crypto market has also dropped by almost USD 1 trillion as Bitcoin trades below USD 20,000.
Miners Turn to Ethereum Classic and Other Altcoins after the Merge
The transition to PoS has also forced miners to turn to Ravencoin and Ethereum Classic, among other options. Data from CryptoCompare show the hash rate of Ethereum Classic has increased by 240%, while Ravencoin has risen by 51%.
The PoW ranking of CoinMarketCap indicates that Dogecoin (DOGE) is below Bitcoin (BTC) as the pioneering cryptocurrency.
Meanwhile, Ether is trading at around USD 1,467 and has accumulated a 7.4% loss over the last 24 hours. While its daily trading volume is above USD 17.96 billion, its market capitalization is about USD 176.25 billion, according to CoinGecko.
By Alexander Salazar
