Source: bitcoinexchangeguide.com
The SEC and the CFTC are holding a meeting to discuss if Ethereum and Ripple should be considered a security. Although most crypto mavens believe that the meeting will have any effect to change the status of the coins, the market is skittish. The price of Ethereum dipped about 5% from last month but it has recovered some and Ripple seems to be holding.
The obvious effect on the coin if they were to be deemed as securities, is that they would be relegated to the SEC's rules. This would severely limit the coins ability to be decentralized and it would make it easier to track and tax transactions. This is why some pundits expected the price to dip.
Source: thenextweb.com
Overall the Ethereum is not overly concerned as they believe the coin will fail the Howey Test. This test considers a security to be an investment contract where the buyer expects to profit solely from the efforts of a promoter or a third party. The crypto coin certainly fall into a 'gray area'. Gary Gensler, a former US regulator considers that since the coin is mined tends to prove that the coin is not a security. Joseph Lubin, a co-founder of Ethereum, believes it is not a security because its investors share a stake in the coin.
Investors have the general consensus that even if it is deemed a security, the SEC or CFTC do not have the resources to track the transactions. This is probably correct as the IRS is hampered by the same problems on tracking down people whom made a profit from bitcoin trading. They have tracked a small percentage and it is unknown what the future will bring for their efforts to track down evaders.
Source: thenextweb.com
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UPDATE: the SEC has declined to comment on whether a meeting would take place regarding Ethereum. This whole meeting might be #fakenews
Thanks for the update, I missed it.