Howdy! Ben here.

Welcome to the club, eToro!

After targeting Coinbase, Kraken, Bittrex, Robinhood, FTX, and Binance, the US Securities and Exchange Commission has gone after yet another platform.

On Thursday, the regulator announced a $1.5 million settlement with eToro, which lets customers buy and sell stocks, financial assets, and crypto.

The trading app’s headquarters is in Tel Aviv. As part of the settlement, its US branch agreed to stop customers from trading most cryptocurrencies — except for Bitcoin, Bitcoin Cash, and Ether.

Crypto’s legal talking heads bemoaned the agency’s continued crypto crackdown.

“The US is behind on providing clarity to the digital asset industry,” wrote Kristin Smith, the CEO of the Blockchain Association, a prominent crypto lobby group.

However, Smith and her ilk saw Ether’s inclusion in the SEC’s list of acceptable assets as a silver lining. It’s further confirmation that the SEC does not view Ether as a security, they argued.

Ethereum’s rocky road

Until just a few months ago, it looked like the SEC had its sights on Ether, the second largest cryptocurrency by total value.

In March, multiple companies that had business dealings with the Ethereum Foundation reportedly received subpoenas from the SEC. The nonprofit oversees the development and evangelisation of the Ethereum blockchain.

“ETH is a commodity, not a security,” declared Paul Grewal, Coinbase’s chief legal officer, in response to the news.

If Ether were a security, that would put it under the auspices of the SEC, and entail more stringent financial disclosures and regulation.

In April, Consensys, one of the most prominent developers in Ethereum, sued the SEC. Among other demands, Consensys said it wanted confirmation that the agency has no legal authority to regulate Ether.

Then, the SEC did a surprising about-face.

In May, the agency greenlit the trading of spot Ether exchange-traded funds. This implied that it viewed the cryptocurrency as a commodity.

And then, in June, Consenys said that the regulator had closed its investigation into whether Ether was a security.

‘Nonsecurity commodity’

If Ether’s status was at all ambiguous, the eToro settlement is further confirmation of the cryptocurrency’s status, said industry commentators.

The SEC’s decision to let eToro’s US customers continue to trade Ether is “effectively enshrining it as a nonsecurity commodity,” wrote Alexander Grieve, vice president of government affairs at Paradigm, one of crypto’s marquee venture capital firms.

And Grewal echoed Grieve’s evaluation.

“They just conceded ETH is not offered as an investment contract security in secondary markets,” said the Coinbase executive.

But, he couldn’t stop himself from taking yet another shot at the SEC, which is currently embroiled in ongoing litigation with Coinbase.

“There is no plan, no framework, no logic, no due process, and certainly no respect for the law,” he said, in reference to the SEC’s stance on crypto.

Reach out to me at [email protected].

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