The US Securities and Exchange Commission states that the ConsenSys crypto project violated securities laws

The SEC filed a lawsuit against the company ConsenSys, which developed the MetaMask crypto wallet. The US Securities and Exchange Commission is confident that the project violates securities laws.

The lawsuit states that since the fall of 2020, ConsenSys has been operating as an unregistered securities broker. According to the regulator, the company managed to earn about $250 million from commissions.

The SEC also claims that by helping to attract investments through the Lido and Rocket Pool staking programs, Consensys became an intermediary in illegal transactions, depriving investors of the right to protection. Lido and Rocket Pool are defined as investment contracts in the text of the lawsuit. As a result, the regulator demanded that MetaMask Staking be banned.

Ripple CTO David Schwartz expressed support for ConsenSys amid the company’s conflict with the SEC. The crypto enthusiast did not support the actions of the American regulator, comparing the activities of the MetaMask developer with the diamond industry.

Schwartz mentioned the De Beers corporation, which is the largest player in the industry for the extraction and sale of diamonds. The company does not influence the final profit of diamond holders, and MetaMask’s activities do not directly stimulate user income, says Ripple’s technical director.

He also pointed out the difference between investment and business contracts. The latter does not affect user profits, while MetaMask is responsible for providing services to clients.

According to Schwartz, the profit from working with MetaMask is not a result of ConsenSys’ activities. This is influenced by various market factors and user activity.

Schwartz further explained that if the simple act of ‘all the people who have the asset do stuff’ is considered a common enterprise, then almost everything could be classified as a security. This broad interpretation could blur the distinctions between different asset classes and their legal status.