Newly released documents show the New York Attorney General urged the SEC to classify Ethereum as a security.

This urgency was evident during the SEC’s 2023 enforcement action against crypto exchange KuCoin. However, the SEC ultimately declined to publicly state that position. 

The documents, made public by Coinbase through a Freedom of Information Act request, include an email from Shamiso Maswoswe, head of the Investor Protection Bureau at the NYAG’s office, to SEC Chair Gary Gensler’s chief of staff. 

In the message, Maswoswe requested that the SEC file an amicus brief supporting the argument that Ethereum (ETH) is a security. While she acknowledged that the classification wouldn’t affect the state’s ability to pursue the case, since New York regulates both securities and commodities, she argued that a court ruling affirming ETH’s security status would aid investor protection.

The SEC did not file the brief, and the agency has since maintained a largely ambiguous stance on ETH. 

Historically, the SEC had signaled that Ether was likely a commodity, but after Ethereum transitioned to proof-of-stake, speculation intensified around whether the asset could fall under securities laws. Despite ongoing scrutiny, the SEC has never officially classified ETH as a security.

KuCoin settlement 

The KuCoin case concluded in December 2023 with the exchange agreeing to a $22 million settlement and ceasing operations in New York. At the time, Attorney General Letitia James said the enforcement action was part of broader efforts to hold crypto platforms accountable for unlicensed activity.

Coinbase’s FOIA request has also uncovered additional SEC discussions about digital asset classification, including internal commentary on Ripple’s XRP and the regulatory boundaries between centralized and decentralized blockchain projects.

Coinbase has continued to publish FOIA-obtained documents as part of its legal and public policy efforts to push for transparency around crypto regulation.