Interesting that they had to delete it. I have it on my cache!
It's still available on https://medium.com/@coinbaseblog
The SEC has told us it wants to sue us over Lend. We don’t know why
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Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#62It looks like the entire blog got deleted? https://blog.coinbase.com/
PR post that backfired. This is hilarious I wonder what they thought was going to happen.
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#63Coinbase is even shifter then PayPal. It took several months and numerous support tickets before they clarified that they take a percentage of all ACH withdrawals regardless if it is cash you deposited or proceeds of a crypto sale. If you take money out you pay them a percentage. They try really to hide that in their pricing matrix. Every time I asked about it I would either get a form letter pointing me to the pricing matrix, or a form letter explaining my bank may charge a fee for ACH. If I asked in a way that was clear that I had read the matrix already and verified my bank charged no ACH fees - they would stop responding. I think some manager was closing stale tickets and they gave me the exact answer.
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#64From the Coinbase page about Lend: >Lend your crypto to earn 4% APY >Your principal is guaranteed This definitely seems fishy. I don't see how this is possible unless if their position isn't levered. However, if they aren't levered, then why can't they just lend USDC themselves?
Someone correct me if I’m wrong, but I don’t believe banks are allowed to lever at the multiples necessary to offer a 4% interest rate (the collateral requirements are prohibitively too high).
Coinbase is not a bank and doesn’t have to play by these rules.
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#65I mean why not go after Coinbase? The argument that everyone else is doing it why not go after them doesn't hold much water. Sometimes it makes sense to go after the biggest fish first.
Also, is Coinbase saying Lend isn't an investment contract? It sure sounds like one to me. Lend my crypto to Coinbase and I get a 4% return? I like the idea but it sure sounds like an investment contract to me.
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#66It looks like the entire blog got deleted? https://blog.coinbase.com/
It opens on Medium app for me and I can see the post just fine.
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#67[deleted]
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#68> They have only told us that they are assessing our Lend product through the prism of decades-old Supreme Court cases called Howey and Reves ... These two cases are from 1946 and 1990. Trying to make out like Howey is some obscure precedent from decades ago which the SEC is nitpicking over. The Howey test is the test applied to determine if something is an investment contract.
It's also like saying - I can't believe they're not letting us operate an Atlantic Slave Trade - because of some supreme court cases from decades ago.
Why should the decades matter?
Supreme court cases matter...
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#69“We have no idea why the SEC intends to sue us! It is a complete mystery.” (Later in the post…) “All we’ve done is create a thing that people can trade which we are moving towards selling to investors against specific SEC advice to the contrary, but it is definitely not a security and as a result it is completely fine even though we have not complied with SEC regulations in any way with respect to it.” A mystery inde…
Coinbase wants to know the legal rationale as to why it's a security, but SEC is stonewalling them and goading them to get into a legal fight. The opposite of "talk to us, come in" that the SEC claims the crypto industry refuses to do.
It is clear from their own blog post that they have communicated with the SEC in considerable detail, and the SEC has told them in no uncertain terms not to proceed. It sounds to me like the SEC welcomed the discussion, it’s just that Coinbase doesn’t like the answer they got.
Re: The SEC has told us it wants to sue us over Lend. We don’t know why
#70I actually initially wanted to be on Coinbase’s side here, but after a quick google of “Howey test” and reading even just the introduction on Wikipedia, I cannot imagine how they don’t see the SEC’s reasoning about Lend wrt Howey. If you want to argue that Howey does not apply or fight the decision/lawsuit, then fine. But feigning ignorance of something a (non-legal expert) programmer can connect the dots of instantl…
> I cannot imagine how they don’t see the SEC’s reasoning about Lend wrt Howey. If you want to argue that Howey does not apply or fight the decision/lawsuit, then fine. But feigning ignorance of something a (non-legal expert) programmer can connect the dots of instantly just makes me feel like they’re playing a PR game.
Grewal was a federal (magistrate) judge in SF before he quit to go work at Facebook. Everyone I know that has appeared before him has thought that he was very good. I'd like to give him the benefit of the doubt - his entire legal career has been patents. Perhaps he truly doesn't see how this applies. But you are right, this just seems... off.
EDIT - I've read this a few times, and despite where it says that this is not an investment or note, it sure sounds similar to the unsecured demand notes that some car companies use for their captive finance operations (in day-to-day operations, they are virtually indistinguishable from an interest-bearing checking account). And those are most definitely SEC-registered securities.
See:
https://www.wsj.com/articles/car-maker-notes-attract-investo...
https://www.ford.com/finance/investor-center/ford-interest-a...