This past week, multiple online news outlets (most notably the Wall Street Journal) reported that the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) would be holding a hearing to classify Ethereum’s status as a security or commodity on May 7th.
They were wrong.
There was no hearing.
In fact, there was no mention of it on the official website of the SEC or CFTC. One Redditor went as far as calling the SEC personally, speaking to a secretary who confirmed that there was no planned hearing between the SEC or CFTC regarding Ethereum’s classification.
Again, the source originated from the Wall Street Journal, and was titled “World’s Second Most Valuable Cryptocurrency Under Regulatory Scrutiny.” Some contend that this was an orchestrated event to cause FUD within the market, which could have potentially resulted in severe price volatility. Fortunately, the price of ETH on all the major exchanges remained relatively steady going into May 7th.
Even if the SEC and CFTC held a hearing behind closed doors, it is their legal obligation to make the meeting’s occurrence public knowledge. The Wall Street Journal’s article caught fire, and one crypto podcast claimed that Ethereum was on the brink of being declared a security.
Within the context of the cryptocurrency space, it is crucial that one does his own research to confirm or deny any claims. Even reputable journalism sources like the Wall Street Journal can falsely claim facts, which can snowball into FUD across the board for other niche news outlets. Another questionable tactic by other news outlets is to generate more traffic with sensationalist headlines (however true or false they may be).
Moving forward, this event stresses the importance of doing your own research (DYOR) especially when it comes to industries like cryptocurrency. It would be wise to check the SEC or CFTC’s website to double check whether or not a hearing on a particular cryptocurrency will actually happen.
One thing’s for sure, this week’s incident did not help the Wall Street Journal’s reputation or credibility with crypto-heads.
What is your opinion on the entire incident? Comment below, we’d love to hear your thoughts.