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SEC Emergency Action Halts PlexCoin ICO

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Re: SEC Emergency Action Halts PlexCoin ICO

#131

Post by tehlike »

berberous wrote: post #29
IMTDb wrote: post #20

Earlier quoted context omitted.

Which ICO was not a scam ?

Scam =/= terrible investment idea. Tezos and Filecoin, for example, are not scams. They are serious projects that are attempting to bring something useful to the market. That said, they raised wayyy too much money, and may end up being terrible investments that don't return any profit, but that applies to many startups as well. PlexCoin offered guaranteed 1300% returns or your money back. That is a pure scam.

I like how you mention Tezos and filecoin not being scams.

Re: SEC Emergency Action Halts PlexCoin ICO

#132

Post by yebyen »

gitgud wrote: post #126
gregdoesit wrote: post #109

Plexcoin, summarized: >"Security is very important to us. That's why we invented a new type of encryption system based on your private virtual currency address, so it is unencyptable." Come up with a new encryption system and tell the world it's unencryptable... I'll just leave this one hanging. Source: Plexcoin blog ( https://www.plexcoin.com/blog/important-statement )

Well, it says "undecryptable" now... ".... based on your private virtual currency address, so it is undecryptable." But that makes me think it cannot be decrypted, which is pretty bad for an encryption system. If you cannot decrypt the data, it might as well be random noise ...

Even if this statement is pristine, it's still pretty flagrant:

> August 10, 13h00 GMT

> We implement a unique encryption system that uses a portion of your private PlexCoin address to encrypt your email address, your password and your wallet. Security is very important to us. That's why we invented a new type of encryption system based on your private virtual currency address, so it is undecryptable.

I mean, even in context, what does this mean? "Security is very important to us."

Re: SEC Emergency Action Halts PlexCoin ICO

#133

Post by busterarm »

resonanttoe wrote: post #9
donquichotte wrote: post #4

> [The SEC] obtained an emergency asset freeze to halt a fast-moving Initial Coin Offering (ICO) fraud that raised up to $15 million from thousands of investors since August by falsely promising a 13-fold profit in less than a month. To me, the PlexCoin homepage [1] is indistinguishable from all the other ICO homepages I've seen. - bootstrap homepage: check - beautiful graphics with actors and coins: check - unclear…

I tend to agree. Every ICO page mainly struggles with number 3. I never get what they are selling, probably because they're not selling anything other than the idea of buying in to their ICO. Let's take a (somewhat snarky and definitely superficial) look at a few of the "top gainers" & market cap from https://coinmarketcap.com/gainers-losers/ (as of Dec 2nd) Gainers: 1. Petrodollar.. Website isn't even an owned domai…

It's almost like we told an entire generation of people "write code, get rich" and then created the means for the most unscrupulous people to do so.

I know a lot of talented folks working in blockchain tech and I can only count two that I know for certain aren't in the space chasing 'fabulous wealth'.

Re: SEC Emergency Action Halts PlexCoin ICO

#134

Post by willsr »

From their FAQ:

"Is it safe? The cryptocurrency is currently the safest currency. Unlike cash, you cannot lose it or have it robbed. No bank will be able to validate your transactions or to take fees on your transactions. It's your money and no one will be able to scrutinize your operations."

People bought this?

Re: SEC Emergency Action Halts PlexCoin ICO

#135

Post by icelancer »

nikolay wrote: post #76
tuxxy wrote: post #63

Earlier quoted context omitted.

Banning ICOs would, quite literally, be impossible.

It's impossible to ban narcotics as well, but they are still persecuted.

One is an order of magnitude tougher than the other. Meanwhile, you picked a perfect example to show how useless banning something like narcotics is; it has led to massive negative second-order effects like gang war and international strife.

Re: SEC Emergency Action Halts PlexCoin ICO

#136

Post by wallacoloo »

So what actions did the SEC actually take? It's an Ethereum token, right? So even if the SEC froze the creator's assets, they can't prevent others from still trading the token. They haven't completely closed the on-ramps for the token, then, since new "investors" can still purchase them in exchange for some other token. I guess they've just halted the creation of new tokens and the advertisement of the token by its creator?

So what happens to all the existing investors? Does the SEC (or another entity) buy back their tokens with the seized funds? Clearly, I haven't dealt with ICOs before, nor do I understand much of how the SEC operates.

Re: SEC Emergency Action Halts PlexCoin ICO

#137

Post by Animats »

brudgers wrote: post #100
Animats wrote: post #51

This is a typical SEC action against a get-rich-quick Ponzi-type scheme. Read the SEC's note on Ponzi schemes.[1] The original Charles Ponzi only promised a 50% return in 90 days. Bernie Madoff promised about 10-15% a year. This "ICO" promised 1300% in 30 days. [1] https://www.sec.gov/fast-answers/answersponzihtm.html

If you can get in early and you recognize it for what it is, a Ponzi scheme can be just another rational investment. Madoff's clients made good returns for a long time. From the perspective of each long term individual investor, the problem was that they did not fold and walk away from the table with their winnings after a few years. The scheme would have survived a few of those, and maybe some investors did. None of…

Only if they actually pay out withdrawals.

Re: SEC Emergency Action Halts PlexCoin ICO

#138

Post by jondubois »

wils1245 wrote: post #129
jondubois wrote: post #116

Earlier quoted context omitted.

I think that's a very insightful statement. Right now regular people only have a few different options to invest in: 1. Stocks 2. Bonds 3. Cash 4. Your own bootstrapped business 5. Cryptocurrencies 6. Lottery The first 2 are obviously limited growth opportunities... Corporations are already massive, people will never get the 100x or 1000x returns that they need to actually notice any lifestyle difference... And even…

Why do you think that it's a reasonable expectation that an economy offers a 1000X multiplier on your money? Where is this value supposed to come from? By altering the means of exchanging capital a significant number of people get 1000X richer? Those kinds of gains can only come at the expense of other "investors".

Yes, assuming that cryptocurrency takes over and it becomes a whole new ecosystem, the gain will be at the expense of everyone who doesn't hold cryptocurrency especially the wealthy elites whose net worth is mostly tied up in the current fiat system.

More people will start offering services on a blockchain and anyone with computing power will be able to run a node for the service and will profit directly from customer payments made to their blockchain address.

The key here is that anyone with moderate technical skills will be able to assist in providing a service by setting up a node on the relevant blockchain - It's not like in the current fiat system where I can't just run my own machine to help service Google users for example (in exchange for a commensurate portion of the proceeds).

It's a fundamentally better system because it takes out the middleman. The current fiat system is all about locking people out while the new system will be able making it impossible to lock people out of opportunities.

Re: SEC Emergency Action Halts PlexCoin ICO

#139

Post by brudgers »

Animats wrote: post #137
brudgers wrote: post #100

Earlier quoted context omitted.

If you can get in early and you recognize it for what it is, a Ponzi scheme can be just another rational investment. Madoff's clients made good returns for a long time. From the perspective of each long term individual investor, the problem was that they did not fold and walk away from the table with their winnings after a few years. The scheme would have survived a few of those, and maybe some investors did. None of…

Only if they actually pay out withdrawals.

True any time you hand over a pile of money with the expectation that the recipient will give you more back.

Re: SEC Emergency Action Halts PlexCoin ICO

#140

Post by quirkot »

finkin1 wrote: post #98
quirkot wrote: post #45

Earlier quoted context omitted.

It's effectively putting knowingly false information in your prospectus. I think that it is the crux, but IANAL

Right, I get that, but it seems like that statement is the only reason the SEC is halting the ICO. Seems like an incredibly idiotic statement to be making when selling a security. Would the ICO have gone off fine if they hadn't made such a ridiculous statement? I guess it could be argued without such a statement they wouldn't have raised as much money, but my guess is that they could had just hedged the statement to…

I guess the take away is that if you're offering a security to the general public, don’t break the law and you won’t get shut down.
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