Ethereum Foundation Facing Inquiry from Unnamed State Authority

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Sources from the Ethereum Foundation’s GitHub indicate that the organization has received a voluntary and confidential inquiry from an undisclosed state authority. The revelation comes from a commit made by Pablo Pettinari, a front-end developer at the Ethereum Foundation, on February 26.

Ethereum Encounters Regulatory Scrutiny

In the commit, Pettinari explained that a section of the footer has been removed, which previously included an image of a canary symbolizing the Foundation’s status of not being contacted by any agency in a manner requiring non-disclosure. Additionally, text asserting the Ethereum Foundation’s lack of contact with any agency worldwide under non-disclosure conditions was also removed.

The presence of the canary and corresponding text was confirmed through the Wayback Machine, indicating their existence as recently as January. However, they are currently absent from the website.

Ethereum Silent on Enquiry

It’s important to state that the canary was initially removed in 2018. However, it was later reintroduced, indicating that its absence was probably due to accidental occurrence rather than intentional removal. Subsequently, there have been modifications to the canary image meant to align with updates in the Foundation’s communication strategy.

The Ethereum Foundation has not provided immediate commentary or clarification regarding the nature or specifics of the enquiry from the state authority. An explanation will help stakeholders understand the nature of the probe which may be on the horizon just as crypto experts are highly optimistic Ethereum prices will continue to climb substantially in the ongoing bull market.

Will Ethereum Face Regulatory Probe?

Analysts however say the development raises questions and speculation regarding potential regulatory scrutiny or legal inquiries that may be faced by the Ethereum Foundation. They believe that a possible scrutiny is on the horizon given that other digital assets such as Binance and Ripple have been under investigation.

The height of regulatory scrutiny on Binance by U.S. authorities occurred when they sought a settlement fee exceeding $4 billion to address the cryptocurrency exchange’s legal concerns. The U.S. Department of Justice (DOJ) afterwards escalated its examination of Binance. It ordered the crypto exchange to strictly adhere to financial regulations within the United States.

As for Ripple, in December 2020, the SEC launched a legal action against it, claiming that CEO Brad Garlinghouse and co-founder Chris Larsen, alongside the company, orchestrated an unregistered securities offering worth $1.3 billion by selling the XRP token. The legal battle continues three years after with the SEC preparing to file an opening brief on Friday.

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