Cryptocurrency Ether, which is the second-largest digital asset by market value, soared more than 10% Thursday following comments from Securities and Exchange Commission (SEC) Director of Corporate Finance William Hinman.

Speaking at the Yahoo Finance All Market Summit Thursday, Hinman said that Bitcoin and Ether are not securities. That's positive news for cryptocurrency bulls, as the digital assets would be subject to considerably more requirements and tighter scrutin  if they were to be labeled as securities.

"Putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions," Hinman said.

Following Hinman's comments, Ether rallied more than 10% to about $520 per token, according to data from CoinMarketCap. Trading volume surged to $2.4 billion, a level not seen since May 24.

Bitcoin also pushed higher about 5% to $6,695 on the news.

Hinman's comments follow a similar sentiment communicated by SEC Chairman Jay Clayton, who said earlier this month that his agency had no plans to change its standards and regulations in order to include Bitcoin in the definition of a security.

Should Ether, Bitcoin and other digital assets continue to not be considered securities, regulation of their associated initial coin offerings, or ICOs, is expected to let up some.

"If we are not subject to securities rules with respect to [Ether], it paves the way for the use of smart contracts to settle securities token transactions," said Jim Dowd, founder and CEO of North Capital. "It also provides some guidance on how we should be viewing [Bitcoin and Ether] as a regulated entity that is in the business of securities dealing."

"These comments provide a pathway for other decentralized cryptocurrencies or crypto utility tokens whose attributes are like [Bitcoin or Ether], to establish that they are not securities, based on the facts and circumstances," Dowd said. "The SEC has always said that whether a digital asset is a security depends on the facts and circumstances, but there has never been a dispositive set of facts and circumstances to reference."

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