Does the fact that ethereum nodes have a significant presence in the United States give rise to U.S. jurisdiction over a token sale without more?

According to a federal judge in New York in a new opinion issued on 1/21 the answer to that question is no!

A brief thread

Barron v. Helbiz was a putative (that is so-called) class action filed in the Southern District of New York.

At issue was a 2018 ICO for something called HelbizCoin.

According to the buyers it was aptly named and they filed a typical ICO recovery lawsuit.

The Court says it was most def a Howey type security, and not registered.

BUT -- The class representatives (named plaintiffs) weren't Americans and the Court couldn't find any evidence that US persons had purchased any of the tokens or done so in the US.

The plaintiffs, rather creatively, said that because Ethereum runs on nodes throughout the US therefore there was enough contact with the US to justify exercise of US jurisdiction over the defendants.

The Court did not buy this reasoning.

Under the Morrison, there were simply not enough of or the right kind of contacts with the US to invoke US jurisdiction.

I think (though I am not 100 percent sure) that this is the first opinion to deal with jurisdiction simply on the basis of nodes being present in the U.S. The reasoning makes sense to me and is a positive sign for transactions on distributed/decentralized platforms. But ...

... there is contrary law out there that deals w/ centralized servers, so this may not be the last case to address the issue, though it was certainly fun reading about nodes and seeing how a federal judge parsed the significance of their presence here for purpose of a transaction

Anyway -- that's a little crypto caselaw minute for you.

for those of you who feel like US courts have too much sway over things that happen outside of the US, here's an example of a court that said "nah". I would also tell you that our courts are busy enough that judges are generally not inclined to keep cases that don't belong here

In short -- this was a securities offering not listed on US exchange or purchased in US. Use of Ethereum network to enough standing alone under Morrison.

Case dismissed.

/fin