Ethereum co-founder Joe Lubin says Consensys is willing to spend millions of dollars to challenge the Securities and Exchange Commission's (SEC) enforcement campaign against the broader Ethereum ecosystem in the United States.

Speaking exclusively on the Decentralize with Cointelegraph podcast, Lubin unpacked the finer details of Consensys’ decision to take preemptive legal action against the SEC. Listen to the full podcast below.

The Ethereum co-founder believes the financial and operational costs incurred by the cryptocurrency ecosystem due to the SEC’s “regulate by enforcement” policies are hard to quantify.

“We’re all in. But we should think about the costs we’ve already incurred and the costs that our entire ecosystem keeps incurring,” Lubin told Cointelegraph.

The Consensys CEO said the SEC had been “carpet bombing” the entire ecosystem with enforcement actions, forcing companies to search for and produce “an enormous amount” of documents to appease the U.S. securities regulator.

Related: Ethereum ETF approvals becoming ‘giant political issue’ — Joseph Lubin

Lubin said that small startups in the cryptocurrency space threatened with legal action by the SEC are being hamstrung by an inability to raise money:

“It’s a really effective way of slowing or killing an ecosystem.”

Lubin revealed that Consensys was preparing to pay “tens of millions of dollars” in legal fees to take on the SEC for determining “internally and secretly” that Ether (ETH) is a security.

“Everybody keeps saying it’s a commodity. Yet he can’t bring himself to say that it’s a security. He’s punishing everybody in our ecosystem as though they’ve already determined internally, secretly, that it is a security,” Lubin added.

Ethereum’s roadmap and layer-2s

The Ethereum co-founder also discussed Ethereum’s ongoing roadmap, the importance of modularization, and the layering approach for scalability. He explained how the technology’s scalability has matured, enabling diverse applications and broader adoption.

“Mature engineering systems modularize for effectiveness and efficiency. Our ecosystem is modularizing and layering, and that’s great. The pains that some experience are around this divergent phase of achieving scalability,” Lubin explained.

The Consensys CEO said that Ethereum has achieved horizontal and vertical scalability, which will eventually allow for more layers of complexity.

Diversity of solutions is an important step in allowing Ethereum’s infrastructure to converge, allowing software development kits to enable chain abstraction and “single coherent view of the ecosystem”.

Lubin said the end goal is an “intents-based architecture” in which the many parts of Ethereum’s network seamlessly carry out the necessary communications and transactions to meet a user’s specific wants.

“You’re talking to your wallet and saying, I want some Solana tokens, or I want to play a game. It just goes ahead, does all the necessary bridging and swapping, and puts the requisite number of tokens into your MetaMask,” Lubin explained.

This eventuality will require artificial intelligence (AI) tooling and solver networks and “highly scalable, highly diverse machinery underneath.” Lubin drew comparisons to the internet of today, which runs on a wide variety of different kinds of databases for different purposes.

“Whether it's Google Docs, Google Sheets or Excel, SQL databases and non-NoSQL, vector databases, graph databases. The databases we use every day.”

Lubin’s views on Solana, Bitcoin and Vitalik Buterin

The Ethereum co-founder also commented on staking, the return on investment for validators, and the inherent risks. Lubin unpacked how stakeholders perceive staking and its importance in the Ethereum ecosystem.

EigenLayer was another point of discussion, with Lubin explaining how innovations like restaking and elastic security resources will transform startup operations in the blockchain space.

The Consensys CEO also discussed the Solana (SOL) ecosystem and how Bitcoin (BTC) shaped his journey into the world of cryptocurrencies and blockchain.

Lastly, he recapped Vitalik Buterin’s ongoing influence on the Ethereum ecosystem and his broader vision. Joe highlights Vitalik’s role in transitioning Ethereum and his involvement in global initiatives for technological adoption.

Listen to the full episode of Decentralize with Cointelegraph on Cointelegraph’s podcast page, Spotify, Apple Podcasts or your podcast platform of choice. And don’t forget to check out Cointelegraph’s full lineup of other shows!

Disclaimer: This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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