Consensys, the software company behind the MetaMask digital wallet, is calling on U.S. regulators to recognize the advanced safeguards inherent in the design of Ethereum (ETH).
The Fort Worth, Texas-based company responded to the U.S. Securities and Exchange Commission's (SEC) recent request for public comment on Nasdaq's pending rule change application to allow trading in the iShares Ethereum Trust. wrote.
In its letter, ConsenSys explained why regulatory concerns about Ethereum being susceptible to fraud and manipulation are unfounded.
The company also believes that several key aspects of Ethereum's proof-of-stake (PoS) implementation make Bitcoin (BTC) proof-of-work (PoW) the basis for Bitcoin (BTC)-based publicly traded transactions. ) claims to be more resistant to tampering than consensus models. Products previously approved by the SEC.
The regulator's request, issued on March 8, asked for feedback on various aspects of Ethereum, including its proof-of-stake consensus mechanism and the concentration of control and influence by a small number of individuals and entities. We specifically investigated whether these features raise unique concerns about Ethereum fraud and manipulation.
One of the highlights of ConsenSys’ comment letter is Ethereum’s faster block finality under PoS. This ensures provable transaction finality in a shorter time frame than PoW. Additionally, Ethereum’s PoS relies on a decentralized and randomized verification process that precludes the control of large stakeholders, reducing the risk of manipulation.
The blockchain technology company also highlighted Ethereum's significant penalties for validators who violate protocol rules and the network's Byzantine fault tolerance, and emphasized that attacks on Ethereum are significantly more costly than on Bitcoin.
He also highlighted Ethereum's environmental benefits, noting that the network's consensus mechanism is more environmentally friendly than Bitcoin.
In a letter, ConsenSys asked the SEC to approve the Spot Ethereum ETF. The company highlighted its commitment to onboarding the next billion users to web3 and said the comment letter is a step toward accelerating progress and providing the public with relevant and useful information. Ta.
The Company has indicated that it stands ready to engage in an ongoing and constructive dialogue with the SEC and its staff regarding this matter.
In addition to ConsenSys, other players in the crypto industry have also weighed in on the Ethereum ETF. In early March, reports surfaced that Coinbase had met with the SEC to discuss Grayscale's proposal for an ETH exchange-traded fund.
According to reports, Coinbase has made a presentation to regulators and, if approved, committed to entering into an oversight and sharing agreement with the Chicago Mercantile Exchange (CME) to check for fraud and manipulation in the Ethereum ETF market.
