With significant enhancements like the Merge taking center stage, Ethereum [ETH] has surely been the buzz of the crypto town. In addition, the network’s switch to proof-of-stake [PoS] has fueled rumors that ETH will be classified as a security. Now, the SEC asserted in a lawsuit against crypto influencer Ian Balina that ETH transactions that took place in the United States immediately fell under the government’s radar, further bolstering this case.
Balina was accused of selling unregistered tokens, for which it was sued. Before launching an initial coin offering [ICO] in 2018, he failed to register his project as a security. The crypto influencer flat-out refuted these allegations. The crypto community is presently making assumptions about the SEC’s extensive statement in the case, though. The lawsuit claimed that it had the power to prosecute Balina since the SEC has authority over the Ethereum network in the 69th paragraph.
The Balina-curated investment pool reportedly included a range of investors situated in the United States. Additional ETH contributions were validated by a network of Ethereum blockchain nodes. As a result, the SEC claimed,
“ETH contributors were validated by a network of nodes on the Ethereum blockchain, which are clustered more densely in the United States than in any other country. As a result, those transactions took place in the United States.”
Furthermore, it should be noted that 3340 out of the 7819 Ethereum nodes, or 42.56 percent, are currently located in the US.
Ethereum’s stance
Following the Merge, there has been a significant backlash against the Ethereum network. As was already indicated, some were speculating that since the network would now be regarded as a security, the SEC would have jurisdiction over it. Others, though, were criticizing ETH’s degree of decentralization.
In the midst of all of this, the network would suffer from the SEC’s most recent pronouncement. Several legal experts pointed out that the wording of the complaint would be observed even if it would not have any legal relevance.
Furthermore, at the time of writing, Ethereum (ETH) was priced at $ 1,361.54 and had taken a plunge of 0.50% over the last 24 hours.