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The writer is the co-founder of Ethereum and CEO & founder of Consensys, a blockchain software company

Imagine a scenario in which the US government — suddenly, arbitrarily and without any justifiable authority — outlawed a commodity like petrol. Now imagine this occurred in the early 1900s, right as Henry Ford emerged on the scene, creating a model for the automotive industry that has endured for over a century. A ban on petrol would have equated to a ban on driving altogether, crippling the burgeoning auto industry, allowing the rest of the world to pursue game-changing innovations and creating a lasting, depressive impact on the way Americans live.

This comparison may seem extreme but it is instructive regarding the potential impact of a US Securities and Exchange Commission ruling on the future of ether, currently under consideration. Ether is the digital commodity that, like petrol, powers programs running on the Ethereum network, the world’s largest programmable blockchain.

This network has the potential to usher us into the next phase of the internet, where content, identity, ownership, security and accessibility are, crucially, controlled by the user, not any big tech company. That’s why many companies, including BlackRock, Franklin Templeton, Nike, Adidas, Gucci and Publicis, are working on software applications that involve the tokenisation of physical and financial assets, loyalty and engagement systems and much more, using Ethereum. 

Yet, in an unprecedented power grab, the SEC has recently waged war on digital assets like ether and, by extension, the entire Ethereum ecosystem — likely sparing no company, developer or user in its seeming attempt to recategorise ether as a security. This is a reversal from historical and recent statements made by the Commodity Futures Trading Commission, which defines ether as a commodity, as well as prior guidance from the SEC itself.

Reclassifying ether via a set of arbitrary enforcement actions would cripple our industry in the US, with a profound chilling effect elsewhere. The SEC has been unwilling to follow the fundamental principle of separation of powers in the US, where it is the job of Congress to legislate, not agencies. Instead, it is attempting to regulate by post facto punishment. In the process it will kill technology it doesn’t favour. The SEC has a mandate to regulate securities, not technology. As its commissioner Hester Peirce recently stated, “Congress did

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The head of India’s oldest stock exchange has warned of the growing danger of investment scams and deepfakes preying on the country’s large cohort of retail traders.

Sundararaman Ramamurthy, the chief executive of the BSE bourse, said fraudsters had used his likeness to try to dupe the public and his own employees in recent months.

“It’s going to be an ongoing menace, that much is sure,” Ramamurthy said about deepfakes in a Financial Times interview. “It’s getting very sophisticated.”

The BSE and its larger rival, the National Stock Exchange of India, last month issued statements warning millions of the country’s retail traders to be cautious of investment advice on social media after their respective chief executives became the targets of deepfakes and hyper-realistic video, audio or image manipulations.

WhatsApp messages pretending to be Ramamurthy, 61, were sent to BSE staff looking to con them out of money, along with manipulated videos of him telling people on social media to join investment communities.

“One of my friends called me early morning that day and he said: ‘Hey Sundar you’ve become a celebrity . . . you have a deepfake video’”, Ramamurthy said in his office in Mumbai. “Did I feel very happy about it? No.”

Across the world, enforcement agencies are struggling to curb waves of manipulated videos and fraudulent social media messaging. In India, where multi-week elections are under way, Bollywood stars have filed police complaints after viral fake videos showed them criticising Prime Minister Narendra Modi.

Deepfakes of prominent Indian corporate leaders from Mukesh Ambani to Ratan Tata have also surfaced. In December, Tata made an Instagram post to label a video that showed him supposedly urging viewers to make “risk-free” investments as “fake”.

While the BSE chief has filed a police complaint, officials at the bourse admit they have limited resources to fight back, with many of the scams originating from IP addresses outside of India, making it difficult to identify the scammers.

An increasing number of Indians are falling victim to online scams. A survey by pollster LocalCircles last year found that 39 per cent of 32,000 respondents said they or their family members had been victims of financial fraud in the past three years.

Since the Covid-19 pandemic, millions of Indians have taken to trading stocks and riskier derivatives, helped by cheap data and online retail trading platforms. About a