United States of America: Filed SEC lawsuit against Consensys Software for allegedly unregistered offers and sales of securities through its MetaMask staking service

On 28 June 2024, the United States Securities and Exchange Commission (SEC) filed a lawsuit against Consensys Software for allegedly unregistered offers and sales of securities through its MetaMask staking service. Consensys Software Inc. (Consensys) is a US-based blockchain and web3 software company. The SEC's complaint, filed in federal district court in the Eastern District of New York, charges Consensys with violating the registration provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934 and seeks injunctive relief and penalties. In particular, the SEC charged Consensys for allegedly unregistered offers and sales of securities through its MetaMask Staking service and for operating as an unregistered broker. Since January 2023, Consensys has sold unregistered securities for Lido and Rocket Pool, which issue liquid staking tokens (stETH and rETH) in exchange for staked assets. The SEC alleges that Consensys, by collecting substantial fees and participating in these transactions, violated federal securities laws. In addition, since October 2020, Consensys has brokered transactions in crypto asset securities without proper registration, providing investment information, handling customer orders, and receiving transaction-based compensation.