Ethereum Foundation Reportedly Under Investigation: What We Know So Far

The Ethereum Foundation, the central entity behind the Ethereum ecosystem, finds itself under the spotlight as reports emerge of an ongoing investigation by an undisclosed "state authority." 

According to a GitHub commit dated February 26, 2024, the Ethereum Foundation disclosed that it had received a voluntary enquiry from a state authority, accompanied by a strict requirement for confidentiality. The nature of the inquiry and the identity of the authority remain undisclosed.

CoinDesk reported the removal of a disclosure from the Ethereum Foundation's website, which previously stated that the foundation had never been contacted by any agency in a manner requiring non-disclosure. 

Additionally, the website's warrant canary, a mechanism indicating the absence of secret government subpoenas or requests, was also removed in the same GitHub commit.

The removal of the warrant canary raises concerns within the community since it serves as a subtle indicator of government intervention. Companies typically include warrant canaries on their websites to signal if they've been served with secret government requests. 

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Legal Scrutiny and Past Incidents

This recent development follows previous legal scrutiny faced by the Ethereum Foundation, notably regarding its alleged involvement in the 2016 Gatecoin hack. 

On-chain forensic analyst TruthLabs brought forward accusations against key figures, including Vitalik Buterin and Joseph Lubin, leading to intense community discussions and an independent legal investigation.

It is unclear whether the recent investigation is related to past incidents or relates to a separate issue. 

Amidst these developments, the SEC continues to evaluate multiple applications for an Ether ETF. However, analysts express declining optimism regarding approval, citing a lack of engagement between applicants and SEC officials. 

Meanwhile, Ethereum ($ETH) fell by 3% in a few minutes as the news broke out and current trading at $3,285, according to CoinMarketCap.