The Securities and Exchange Commission (SEC) is abandoning its case against Brooklyn-based crypto company ConsenSys, continuing a strategic retreat from aggressive crypto enforcement.
The case against ConsenSys's popular MetaMask wallet tool marks the latest enforcement action dropped under new SEC leadership. The decision requires approval from the agency's commissioners.
"We were committed to fighting this suit until the bitter end but welcome this outcome," ConsenSys CEO Joe Lubin wrote Thursday on X. "No company wants to be the target of agency enforcement, but at the same time, it was our duty and honor to stand up for blockchain software developers in the hour it was most needed."
Lubin said his company felt obligated to challenge what many in the industry viewed as regulatory overreach. The SEC had alleged MetaMask functioned as an unregistered securities broker that "engaged in the offer and sale of securities" when it sued ConsenSys last June.
The case came shortly after the SEC closed a separate probe into Ethereum 2.0, which ConsenSys had previously challenged in court. That investigation had prompted ConsenSys to sue the regulator in April 2024.
This decision joins a growing list of abandoned crypto enforcement actions. The SEC recently dropped cases against major industry players including Coinbase, Gemini, Robinhood Crypto, Uniswap Labs and OpenSea. The regulator has also requested courts pause ongoing proceedings against Binance and the Tron Foundation, along with their affiliated companies and executives.
The regulatory shift follows the departure of former Chairman Gary Gensler, whose approach critics labeled as "regulation by enforcement." Acting Chair Mark Uyeda has established a Crypto Task Force led by Commissioner Hester Peirce, known for her crypto-friendly stance. Peirce recently outlined the SEC's new regulatory approach and asked for patience as the agency works to extricate itself from ongoing litigation.
"We appreciate the SEC's new leadership and the pro-innovation, pro-investor path they are taking," Lubin wrote. "We will remain deeply engaged with public and private policymakers going forward. Crypto wants the U.S. to address the best interests of consumers and businesses alike, and we are already on our way to making that happen."
The SEC declined to comment on the matter.
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