Ethereum Foundation Under Investigation by a State Authority

• Ethereum Foundation has reportedly received a voluntary inquiry from a state authority amidst its ETF expectations. 

• The price of ETH made an incredible surge in the last 24 hours as it surged by 11%, trading at $3.5k. 

The Ethereum Foundation has been subpoenaed for the first time in its history, casting a shadow over its much-anticipated spot ETH Exchange-Traded Fund (ETF) approval. According to multiple reports, the repository of the Ethereum Foundation as discovered from a GitHub “commit” on February 26, shows that it received an inquiry from a state authority in addition to a confidentiality requirement or what is term as a gag order. 

We have received a voluntary inquiry from a state authority that included a requirement for confidentiality.

With no confirmation on the exact state authority that issued the order, one of three agencies – The US Securities & Exchange Commission (SEC), The Federal Bureau of Investigations (FBI), and the Internal Revenue Service (IRS) are historically known for being associated with a gag order. 

As discovered, there has been the removal of contact and canary of which Wayback Machine data shows this feature and associated text were present in January. In a nutshell, the website’s footer and warrant canary are “gone”. 

Interestingly, the website previously had this disclosure:

The Ethereum Foundation (Stiftung Ethereum) has never been contacted by any agency anywhere in the world in a way that requires that contact not be disclosed. Stiftung Ethereum will publicly disclose any sort of inquiry from government agencies that falls outside the scope of regular business operations.

Attorney Believes this May Have a Correlation with the Ethereum ETF Decision

It is important to note that a warrant canary is a visual or text warning mostly included on websites to show that they have never been served with a government subpoena or document request. In situations where the company receives such requests from a government agency, it removes the text without necessarily providing details. In 2019, it was reported that the warrant canary on the Ethereum Foundation’s website was mistakenly removed. However, it was soon added back. 

On this development, an attorney familiar with this kind of development suspects Ethereum Foundation has been served with a document request by a Swiss regulator who may be working with the US Securities and Exchange Commission (SEC). 

I also think it’s fair to say the Ethereum Foundation is not the only entity that they are seeking information from.

Interestingly, this is the time when anticipation surrounding the spot Ethereum ETF remains high. Many analysts predicted that there could be an approval in May. However, Bloomberg analysts had to review their odds from 70% to 30% due to little or no movement surrounding the initiative contrary to what happened during the pre-approval of the spot Bitcoin ETF as reported by Crypto News Flash.

According to the attorney, any rumors of any activity that the SEC and its overseas counterparts may be involved in may have something to do with the May 23 deadline. 

The price of ETH has interestingly not been affected by this news as it made an 11% surge in the last 24 hours to trade at $3,531. However, its 24-hour trading volume has declined by 6% as of press time. 

Recommended for you: