The U.S. Securities and Exchange Commission (SEC) has faced criticism over its stance on the classification of the cryptocurrency Ether (ETH). According to Patrick McHenry, the Chairman of the House Financial Services Committee, new evidence suggests that SEC Chair Gary Gensler lied to Congress about the agency's position on Ether.

McHenry claims that during his testimony before the Financial Services Committee in April 2023, Gensler deliberately declined to respond to inquiries about the SEC's Ether classification. However, recent court documents indicate that this was a deliberate attempt to misrepresent the Commission's viewpoint.

This revelation comes just months after a federal judge disciplined SEC enforcement attorneys for lying to the court. The classification of Ether as a security contradicts the SEC's previous statements, further highlighting the agency's arbitrary and capricious approach to regulating digital assets.

The episode underscores the need for the bipartisan FIT for the 21st Century Act, which aims to provide a clear legal framework and strong consumer protections for the digital asset markets.

Additionally, a recent report suggests that Gensler has considered Ethereum as an unregistered security for at least a year, which is at odds with the SEC's earlier stance on Ethereum's classification as a commodity. This development has raised concerns about the Commission's consistency and transparency in its regulatory actions.

Furthermore, the blockchain company Consensys has filed a lawsuit against the SEC, alleging that the agency is attempting to take over the Bitcoin sector. This claim stems from the SEC's previous classification of Bitcoin as a non-security in a 2018 report, which has now been called into question amid the ongoing Ripple case and accusations of partiality.

Overall, the SEC's handling of the Ether classification and its broader approach to digital asset regulation have come under intense scrutiny, with calls for greater clarity, consistency, and accountability from the financial regulator.