New York Attorney General Alleges Ethereum Tokens are Securities in Lawsuit Against KuCoin Crypto Exchange – Crypto Clampdown Incoming?

cryptonews.com:

New York Attorney General Letitia James referred to Ethereum’s native ETH token and other cryptocurrencies as “securities and commodities” in a statement issued in relation to her lawsuit against crypto exchange KuCoin.

In the statement, Attorney General James said KuCoin has facilitated trading in a number of cryptocurrencies to residents in New York, where the platform is not registered as required by law.

“The Office of the Attorney General (OAG) was able to buy and sell cryptocurrencies on KuCoin in New York even though the company is not registered in the state,” she said.

She added about KuCoin that the platform allows traders, including those in New York State, to “buy and sell popular virtual currencies, including ETH, LUNA, and TerraUSD (UST), which are securities and commodities.”

The statement from the Attorney General is surprising given that it is likely the first time a regulatory official in the US have referred to ETH specifically as potentially being a security for regulatory purposes.

If the asset was to officially receive such a classification in the US, it is expected to have far-reaching implications for the crypto industry. The scenario has long been feared in Ethereum circles, although it remains unclear exactly how it would affect the Ethereum project and the price of ETH.

The Ethereum Foundation, which funds much of the development that happens on the Ethereum network, is not based in the US, but instead registered in Switzerland. Additionally, much of the trading in ETH and other altcoins happens on offshore exchanges that are not regulated in the US.

In the past, Rostin Behnam, chair of the Commodity Futures Trading Commission (CFTC), has said that bitcoin (BTC) is the only cryptocurrency that can be