Ex Ethereum advisor Steven Nerayoff criticizes platform amid SEC scrutiny

Early Ethereum (ETH) advisor Steven Nerayoff has recently expressed serious concerns over the investigation of Ethereum by the U.S. Securities and Exchange Commission (SEC).

Nerayoff claimed in an X thread on Thursday (Mar.21) that the prospects of Ethereum exchange-traded funds (ETFs) might be facing more rigorous examination. The SEC has issued subpoenas to several entities involved with Ethereum and its possible ETFs, signaling intensified regulatory attention.

UNVEILING ETHEREUM'S DECEPTIVE EVOLUTION:
The problems with @ethereum, the announcement of the @SECGov investigation, and the ETHGate movement are all due to the founders' greed and willingness to allow our revolutionary project to become nothing more than a deceptive database…

— Steven Nerayoff (@StevenNerayoff) March 21, 2024

Despite previous disputes with Ethereum’s leadership, including accusing co-founder Vitalik Buterin of being a fraudster, Nerayoff expresses deep disappointment with how Ethereum has evolved. He believes that had his original ideas been implemented, Ethereum would not be encountering its current challenges:

If my invention was followed, we wouldn’t have issues today; Ethereum would still be the base of crypto.

Nerayoff criticizes the Ethereum project for straying from its original vision, attributing the SEC’s investigation and the emergence of the ETHGate movement to the founding team’s greed. He argues that this deviation has turned Ethereum into a “deceptive database” manipulated by a select few at the expense of the broader community.

Ethereum is built on deceit and lies, and they think you’re all dumb enough to not be the wiser. Well, I am, and I am saying to all of you, don’t allow this to happen a day more. The Ethereum house of deceit must fall once & for all!

Nerayoff particularly highlights the rise of scam Initial Coin Offerings (ICOs) and the resulting erosion of trust as outcomes of current Ethereum leadership moving away from his initial concepts. He also highlights the non-fungible token (NFT) craze which he described as “a handful of people creating tokens and rug pulling them.”

This is not the first time that Nerayoff voiced concerns over Ethereum and its leadership. Back in September 2023, he suggested that the ecosystem received preferential treatment from regulators through an infiltration of regulatory bodies. In an audio of a nearly three-hour call with Buterin shared back in November 2023, he warned the Ethereum co-founder:

I am fairly convinced that securities laws and these other laws have been tripped.

The controversy follows Ethereum’s recent introduction of the Dencun protocol upgrade. Still, despite the upgrade having a significant impact on the protocol’s fees Solana was able to overtake Ethereum’s decentralized exchange volume soon after.

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