Lido DAO (LDO) and Rocket Pool (RPL) prices dropped sharply on Friday. Currently, LDO is down 15% and RPL is down 10%, due to recent regulatory news. The price of Ethereum (ETH) also fell, losing nearly 3%. Maker (MKR), Uniswap (UNI), and Arbitrum (ARB) also traded lower.
This decline is linked to the US Securities and Exchange Commission (SEC) suing Consensys, the Ethereum software company that developed the MetaMask crypto wallet.
SEC’s Shift in Stance on Ethereum 2.0
The SEC recently concluded its investigation into Ethereum 2.0, indicating a change in the regulator’s outlook on altcoins. Notably, in May, the SEC approved spot Ethereum ETFs for the US market.
Despite this positive development, there remains a looming issue—the SEC’s Wells Notice against Consensys. This notice suggests potential enforcement action, as the SEC has expressed its concerns about MetaMask, Consensys’ crypto wallet, and its staking service platform.
Ethereum-Related Cryptocurrencies Surge Amid Market Dip
Lido (LDO) and Rocket Pool (RPL), both Ethereum-related cryptocurrencies, saw significant gains despite a broader market downturn. The rise followed an announcement from Consensys that the SEC had concluded its probe into Ethereum 2.0.
Following the news, LDO’s price increased from around $1.85 to highs of $2.40, marking a significant victory for Ethereum. Similarly, RPL jumped from $26.50 to over $30.00, driven by this positive news and other favorable factors.
SEC Files Lawsuit Against Consensys
In today’s lawsuit, filed in the United States District Court for the Eastern District of New York, the SEC alleged that Consensys violated federal securities laws by failing to register as a broker-dealer and by offering unregistered securities.
Allegations Involving Lido and Rocket Pool
According to the SEC’s complaint, “Consensys has offered and sold tens of thousands of securities for two issuers: Lido and Rocket Pool.” The SEC also claimed that Lido and Rocket Pool’s staking operations with ETH lead investors to expect profits, which are generated through the managerial efforts of these two protocols.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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