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Ethereum co-founder Joseph Lubin believes the United States Securities and Exchange Commission is intentionally hindering innovation, which threatens the countrys existing financial landscape.

Speaking at FT Lives Crypto and Digital Asset summit in London, Lubin unpacked Consensyss decision to sue the SEC after receiving a Wells notice from the U.S. securities regulator.

The SEC appears to have reclassified Ether as a security without telling anybody that thats the case. They are going about a strategic series of enforcement actions rather than open discourse and clear rulemaking, Lubin said.

Related:Consensys files lawsuit against SEC and commissioners over Ether regulation

The CEO of Consensys which developed the MetaMask wallet said the enforcement actions intend to create fear, uncertainty and doubt for the cryptocurrency industry in an attempt to paralyze and force the company offshore.

Lubin said the firms counteraction against the SEC is aimed at getting more clarity from U.S. courts, considering that the Commodity Futures Trading Commission had previously classified Ether (ETH) as a commodity.

The Consensys CEO also highlighted the upcoming deadline for the SEC to issue a decision over the approval of Ether spot exchange-traded funds (ETFs) as a driving force behind the regulators renewed enforcement action against Ethereum.

We believe that theres a flurry of activity designed to enable them to say that their action wasnt capricious in the very likely event that they deny the Ether spot ETFs, Lubin explained.

Lubin said the SEC had noticed how much capital had flowed into the ecosystem following the approval of spot Bitcoin (BTC) ETFs:

Lubin also speculated that the prospect of the banking industry's customers moving assets into digital forms using decentralized finance constructs could scare many banks and other financial institutions.

The SEC probably doesnt want to see a wave of innovation that will really transform the landscape," he said.

The importance of a positive outcome against the SEC could also have wide-reaching implications for the cryptocurrency and technology landscape in the United States.

Lubin said the SECs claims that Coinbase and MetaMasks wallets are acting as broker-dealers are setting a dangerous precedent. He added that the thought of a piece of software acting as a broker-dealer was a preposterous notion.

Related: US SEC expected to deny spot Ether ETFs in May

Were at odds over whether we should register MetaMask as a broker-dealer. Should every MetaMask user have to register their wallet as a broker-dealer, its chilling, Lubin added.

The Consensys CEO concluded that the entire technology industry in the U.S. could be impacted by the actions of the securities regulator.

Magazine:What do crypto market makers actually do? Liquidity, or manipulation

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SEC doesn't want Ethereum to transform banking landscape, says Joseph Lubin - Cointelegraph