Was The SEC In Bed With Ethereum? ETH Gate Explained

0 7

Conspiracy theory or one of the biggest scandals in crypto? The term “ETH Gate” has been on the lips of every XRP supporter in recent months and, increasingly, the broader cryptocurrency community. At the heart of this issue is the US Securities and Exchange Commission’s (SEC) decision to classify Ethereum (ETH) as a non-security, contrasting sharply with its ongoing legal action against Ripple and the XRP token.
What is ETH Gate

“ETH Gate” refers to a theory alleging that the Ethereum Foundation and ConsenSys have fostered close relationships with key individuals within the US Securities and Exchange Commission (SEC) and other entities like JP Morgan, thereby ensuring a favorable regulatory environment for Ethereum.

One cornerstone of this theory are the Hinman emails which were released earlier this year. In these emails, Hinman, who made the landmark speech in 2018 declaring that Ethereum was not a security, interacted with Ethereum’s co-founder, Vitalik Buterin right before the speech. Hinman reportedly consulted Buterin to “understand the operational dynamics of Ethereum.”

Remarkably, Bill Hinman rejoined the law firm Simpson Thacher in 2020 after leaving the SEC. The significance? Simpson Thacher is associated with the Ethereum Enterprise Alliance. Therefore, the XRP army believes that Hinman’s decision to deliver a speech giving Ethereum a regulatory “free pass” may not have been impartial.

Speculations By XRP Army

John E Deaton, an outspoken figure in the XRP community and a keen observer of the SEC’s dealings, has painstakingly put forth allegations suggesting a deeper web of interlinked relationships that hint at possible conflicts of interest. (There are so many that it is not even possible to highlight them all in one article.) His assertions have become pivotal in the “ETH Gate” theory, and here we’ll delve deeper into these connections.

1. Joseph Lubin’s Strategic Moves: Joseph Lubin, co-founder of Ethereum and founder of ConsenSys, is at the core of Deaton’s claims. According to Deaton, within just two months of Jay Clayton’s appointment as the SEC Chairman, Lubin made a potentially strategic hire, bringing on board Patrick Berarducci from the law firm Sullivan & Cromwell. This move is seen by Deaton and many in the XRP community as more than coincidental.

Deaton has drawn attention to this connection in the past, positing that it might have provided Ethereum an inside track or at least a more favorable disposition from the SEC. Sullivan & Cromwell is also notable because Jay Clayton himself was a partner there before his stint as the SEC Chairman.

2. The Hinman-Lubin Email Exchange: Deaton frequently refers to the now-infamous email exchange between Bill Hinman and Joseph Lubin. For Deaton, this correspondence underscores a problematic level of proximity between a regulatory figure and a significant player in the crypto sphere.

The fact that Hinman reportedly emailed Lubin directly is seen by Deaton as a potential sign of collaboration or at least a peculiar level of familiarity. More so, given Hinman’s subsequent public remarks about Ethereum being a non-security, despite warnings against such pronouncements from the SEC’s Office of General Counsel.

3. Jay Clayton and One River Digital Asset Management: After his tenure at the SEC, Jay Clayton joined One River Digital Asset Management. Deaton emphasizes this move as a point of contention. One River is known for its large holdings of Bitcoin and Ethereum. Deaton hints at a potential conflict of interest, questioning if Clayton’s decisions during his time at the SEC may have been influenced by future career prospects or associations that favored Ethereum.

4. Simpson Thacher, Ethereum Enterprise Alliance, and Hinman: One of the most significant points of contention brought forth by Deaton involves Bill Hinman’s associations with the law firm Simpson Thacher. This firm played a role in the Ethereum Enterprise Alliance.

Deaton suggests that Hinman’s connection to Simpson Thacher and, by extension, the Ethereum Enterprise Alliance, could have influenced his decision to publicly declare Ethereum a non-security.

Similarly, an XRP community member known as Mr. Huber has been extremely vocal and is raising compelling questions: “ETH Gate is a conspiracy theory that the SEC tried to create a monopoly for Ethereum?” He goes on to argue that this is a concerted attempt by powerful Wall Street banks like JPMorgan to “control the global crypto market by bribing the SEC to gain a monopoly for Ethereum.”

Latest News On ETH Gate

Yesterday, John E Deaton indicated that new, potentially damning, information about ETH Gate might soon be disclosed. “I’ve always said that one day we will get the full truth. Today is one day closer,” Deaton tweeted in response to Steven Nerayoff’s lawyer, Michael Scotto, who indicated that Nerayoff is prepared to make his facts known “at a time and manner that serves the interests of justice and the people.”

Steven Nerayoff, an early adviser to Ethereum, had extortion charges against him dismissed in May this year. Deaton speculates that Nerayoff could be a significant source of insider information, possibly related to Ethereum’s regulatory free pass. “I have the map,” was Nerayoff unequivocal response to Deaton’s speculative tweets about the matter, as Bitcoinist reported today.

The “ETH Gate” controversy calls into question the impartiality of the SEC in its treatment of different cryptocurrencies. Although allegations remain unproven, the gathered evidence paints a picture of inconsistent regulatory approaches and potential conflicts of interest.

Whether these allegations hold any water remains to be seen, but they have certainly fueled a sense of urgency and scrutiny around the SEC’s policies. If the hints dropped by Steven Nerayoff and John E Deaton materialize into something substantive, ETH Gate could become a pivotal chapter in the annals of cryptocurrency regulation.

At press time, ETH traded at $1,635.

Ethereum price

knife

Leave A Reply

Your email address will not be published.

bitcoin
Bitcoin (BTC) $ 58,105.57
ethereum
Ethereum (ETH) $ 3,131.23
tether
Tether (USDT) $ 1.00
bnb
BNB (BNB) $ 531.47
solana
Solana (SOL) $ 138.88
usd-coin
USDC (USDC) $ 1.00
staked-ether
Lido Staked Ether (STETH) $ 3,131.23
xrp
XRP (XRP) $ 0.461901
the-open-network
Toncoin (TON) $ 7.30
dogecoin
Dogecoin (DOGE) $ 0.107169
cardano
Cardano (ADA) $ 0.409168
tron
TRON (TRX) $ 0.136633
avalanche-2
Avalanche (AVAX) $ 25.54
shiba-inu
Shiba Inu (SHIB) $ 0.000016
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 58,045.55
polkadot
Polkadot (DOT) $ 6.00
chainlink
Chainlink (LINK) $ 12.68
bitcoin-cash
Bitcoin Cash (BCH) $ 353.67
uniswap
Uniswap (UNI) $ 8.10
near
NEAR Protocol (NEAR) $ 5.00
dai
Dai (DAI) $ 1.00
leo-token
LEO Token (LEO) $ 5.67
litecoin
Litecoin (LTC) $ 68.81
matic-network
Polygon (MATIC) $ 0.504671
wrapped-eeth
Wrapped eETH (WEETH) $ 3,264.28
kaspa
Kaspa (KAS) $ 0.167379
pepe
Pepe (PEPE) $ 0.000009
ethena-usde
Ethena USDe (USDE) $ 1.00
internet-computer
Internet Computer (ICP) $ 7.28
ethereum-classic
Ethereum Classic (ETC) $ 21.34
monero
Monero (XMR) $ 159.08
fetch-ai
Artificial Superintelligence Alliance (FET) $ 1.16
aptos
Aptos (APT) $ 6.08
stellar
Stellar (XLM) $ 0.090958
blockstack
Stacks (STX) $ 1.69
hedera-hashgraph
Hedera (HBAR) $ 0.067305
render-token
Render (RNDR) $ 6.14
cosmos
Cosmos Hub (ATOM) $ 6.03
crypto-com-chain
Cronos (CRO) $ 0.087464
mantle
Mantle (MNT) $ 0.699135
filecoin
Filecoin (FIL) $ 4.01
arbitrum
Arbitrum (ARB) $ 0.702428
okb
OKB (OKB) $ 37.64
maker
Maker (MKR) $ 2,394.05
vechain
VeChain (VET) $ 0.026743
renzo-restaked-eth
Renzo Restaked ETH (EZETH) $ 3,164.65
immutable-x
Immutable (IMX) $ 1.26
injective-protocol
Injective (INJ) $ 19.86
optimism
Optimism (OP) $ 1.71
first-digital-usd
First Digital USD (FDUSD) $ 1.00
sui
Sui (SUI) $ 0.739772
the-graph
The Graph (GRT) $ 0.184753
rocket-pool-eth
Rocket Pool ETH (RETH) $ 3,496.37
bittensor
Bittensor (TAO) $ 243.42
bonk
Bonk (BONK) $ 0.000023
dogwifcoin
dogwifhat (WIF) $ 1.58
notcoin
Notcoin (NOT) $ 0.015347
mantle-staked-ether
Mantle Staked Ether (METH) $ 3,248.97
lido-dao
Lido DAO (LDO) $ 1.64
bitget-token
Bitget Token (BGB) $ 1.03
arweave
Arweave (AR) $ 22.08
aave
Aave (AAVE) $ 96.62
ondo-finance
Ondo (ONDO) $ 0.980489
theta-token
Theta Network (THETA) $ 1.39
floki
FLOKI (FLOKI) $ 0.000143
whitebit
WhiteBIT Coin (WBT) $ 9.55
fantom
Fantom (FTM) $ 0.472016
celestia
Celestia (TIA) $ 6.42
thorchain
THORChain (RUNE) $ 3.58
jasmycoin
JasmyCoin (JASMY) $ 0.024141
algorand
Algorand (ALGO) $ 0.137338
based-brett
Brett (BRETT) $ 0.113834
ether-fi-staked-eth
ether.fi Staked ETH (EETH) $ 3,111.99
pyth-network
Pyth Network (PYTH) $ 0.290845
quant-network
Quant (QNT) $ 71.79
jupiter-exchange-solana
Jupiter (JUP) $ 0.758834
coredaoorg
Core (CORE) $ 1.09
elrond-erd-2
MultiversX (EGLD) $ 35.43
sei-network
Sei (SEI) $ 0.314747
gatechain-token
Gate (GT) $ 6.96
kucoin-shares
KuCoin (KCS) $ 9.13
flare-networks
Flare (FLR) $ 0.0192
mantra-dao
MANTRA (OM) $ 1.03
ethereum-name-service
Ethereum Name Service (ENS) $ 26.08
flow
Flow (FLOW) $ 0.547709
kelp-dao-restaked-eth
Kelp DAO Restaked ETH (RSETH) $ 3,164.83
dydx-chain
dYdX (DYDX) $ 1.30
tokenize-xchange
Tokenize Xchange (TKX) $ 9.90
axie-infinity
Axie Infinity (AXS) $ 5.37
akash-network
Akash Network (AKT) $ 3.25
eos
EOS (EOS) $ 0.522447
gala
GALA (GALA) $ 0.021502
bittorrent
BitTorrent (BTT) $ 0.00000079531309
bitcoin-sv
Bitcoin SV (BSV) $ 38.95
tezos
Tezos (XTZ) $ 0.762395
fasttoken
Fasttoken (FTN) $ 2.34
msol
Marinade Staked SOL (MSOL) $ 166.71
beam-2
Beam (BEAM) $ 0.014672
usdd
USDD (USDD) $ 0.999109
starknet
Starknet (STRK) $ 0.561467