Can SEC recognise Ethereum as a security?

Several days ago Wall Street Journal published an article which said that the SEC was to have a meeting, during which it was to be decided whether Ethereum should be recognised as a security or not.
Should the second-largest cryptocurrency be recognised as a security, this might entail some grievous consequences, including penalties, possibility of class actions and liability for the founders.

Lubin

Lubin, one of the co-founders of Ethereum, came out to unequivocally state that the team had done lots of talks with various layover before the launch in order to make sure that there was not chance that the coin might be recognised as a security later on.

Hoax

It seems that this piece of news was a hoax, which originated in Wall Street Journal.
When the author of the article, where this information was publicized first, was asked about the sources for this information, his answer was that he was talking to people that’s what they said to him.
We can see that the owners of Ether did not give in to this FUD campaign and did not start a stampeded to sell out their holdings.

Future

People in the industry don't think that there's any risk that the regulators would recognise Ethereum as a security.
It's said that there are a lot of a bad guys out there and it would make much more sense for the regulator to go after them rather than fighting the good guys - the team behind Ethereum.
The platform has a huge valuation and it's growing popular day by day.
Although some of the cryptocurrencies might be recognized as securities in the future, I don't think that Ether has risk of that.

Howey Test

The regulator uses the Howey Test in order to determine whether a coin is a security or commodity. If it's a security, but the originator did not register this security with SEC, then the fines and removal from exchanges might be coming.
The main point in the Howey Test is that if the buyers of tokens during pre-sale were purchasing the tokens in order to subsequently use them for their own purposes, then it's a commodity. If the buyers were purchasing the coins for the speculative reasons, then this thing might be viewed as a security.
There's a lot of talk about the shareholding that the Ethereum Foundation has, about the role of mining in this scheme, the role of Ethereum in the ecosystem (it's the foundation for almost all other tokens that are being rolled out today).
I think that all of these things are of some importance, but the question as to whether the buyers - during the pre-sale - were buying Ethers to speculate or utilize them is the key one.

Everybody understands that it's all about speculation

Naturally, everybody understand that it's all about the speculation here. There's no question that a large chunk of pre-sale investors were buying it with the expectation that it's going to grow in price and it's pretty unclear whether they were planning to use Ethers for the utilization of the platform itself.

So, SEC will need to introduce the amnesty, because recognizing Ethereum as a security would hurt crypto too much

Although there's a lot of people who believe that the crypto-industry is all about anarchy and punks, it's not.
The regulators see that the new industry is being born. They don't want to kill it, because they will never be able to do that. They industry would just go underground. Whenever the industry of this scale has gone underground, it gets even more tougher to understand what's going on here.
So, the regulators are trying to see what happens next, how this industry is moving forward and whether this bubble might burst on its own.
The crypto-markets have the 500-billion-dollar today. It's a pretty big thing already and it feels that we are just starting.

Steemit

Steemit can be a good example. It's quite possible that this social network will play a major role in the social-media landscape in the years to come, but as of now it hasn't gotten adopted yet.
Whenever Katy Perry starts blogging here, then the mass adoption is going to occur with millions of users flocking to the new social media that is all the rage.
So, if the regulators tried to "suppress" Steemit right now, it's not sure what things they would be able to achieve.
I am from Russia. Russia is trying to ban Telegram. Because of the efforts by the Russian law enforcement agencies, I need to use VPN in order to access Steemit.
Nobody in the US or the rest of the civilized world would even think about doing stuff like that. Here, the values of freedom of speech, freedom of assembly and generally democratic values are at the core of the social psyche. And it doesn't matter whether you are a Republican or Democrat, it's just at the core of your values system.
So, the regulators might try fining the founders of Steemit, but they will have a hard time with "banning" and "stopping" the activities at the platform.
Surely, they would be able to request that the exchanges stop their trading this coin.

Welcome to Russia

If they do that, the exchanges are going to relocate to Russia. And Russia will be extremely happy to do something in order to inflict damage on the US, because the enemy of my enemy is my friend.
The regulators and politicians understand this.

Main concern

I guess that the main concern that the regulators have is how to fight scammers. Ethereum is clearly not a scam operation. They may be trying to work out the ways to hamper scammer activities, while also enabling this new industry to uncover its full potential. After all, the new methods used in ICOs can help us invest companies in a much more efficient and effective way as compare to IPOs.
The regulators understand that and they don't want to kill this industry right after it has started to grow. If they wanted to destroy all the innovative waves, they would have done much earlier, right after Ethereum started its operations. But they did not, because it's not democratic and it's not logical, since innovations can and do bring in innovative solutions to all kinds of fields, including fundraising and regulating fundraising mechanisms.