Decrypt’s Art, Fashion, and Entertainment Hub.
Crypto influencer Ian Balina has launched a GoFundMe page to pay for his legal defense against the U.S. Securities and Exchange Commission (SEC), which earlier this month filed a lawsuit against him for allegedly selling unregistered securities.
Balina claims to be fighting “on behalf of the whole crypto community” and challenging what he feels to be “SEC over-reach [sic].” He’s raised $1,192 three days after launching, with an objective of $25,000.
The Ugandan entrepreneur left his sales role at IBM to promote crypto full-time in 2017, with content such as “How to Make Millions with Initial Coin Offerings ()” racking up hundreds of thousands of views.
However, Balina is now having to solicit funds from supportive crypto community members “due to the costly and exhaustive process ahead.” Balina, who currently resides in Austin, is now looking to challenge the SEC’s “expansive definition” of a security.
Industry pundits have long said the same about the SEC—chairman Gary Gensler is a notorious crypto hardliner.
SEC targets Ethereum through Balina
Perhaps the most striking aspect of the SEC’s lawsuit against Balina is the regulator’s argument that every Ethereum transaction in the world falls under its jurisdiction.
Because most of the network’s proof-of-work (PoW) validator nodes were clustered in the U.S., argued the Commission, the U.S. government, therefore, has jurisdiction over the whole network.
Several in the community took to Twitter to vent their outrage at the SEC’s alleged overreach.
This month, the Ethereum network transitioned to proof-of-stake technology. However, Gensler could still use a similar argument to try and argue for SEC jurisdiction over it.
According to Martin Köppelmann, popular crypto exchange Coinbase and liquidity staking pool Lido Finance (both based in the United States) together account for 42% of post-merge Ethereum validators.
Further, the top seven entities control more than two-thirds of the stake validating transactions, with the bulk of the stake being hosted on cloud services like Amazon.