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Insider Trading at Coinbase

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Re: Insider Trading at Coinbase

#221

Post by renewiltord »

parkingrift wrote: post #107

Crypto fans want deregulated finance. Crypto fans get mad when deregulated finance is comically unfair. You really can’t make this up. Embrace this. It’s exactly what crypto is all about.

I’d prefer Coinbase insider trading over Nancy Pelosi insider trading. So this isn’t the end of the world.

There’s no universe where there’s no insider trading and you’re asking me to switch the Coinbase situation for the Pelosi situation. And I prefer the Coinbase situation.

So I can accept the lesser of two evils and kick up a fuss when I don’t like it. After all, if switching to regulated finance is what you recommend, the cure is worse than the disease.

Re: Insider Trading at Coinbase

#222

Post by toomuchtodo »

BitwiseFool wrote: post #212
toomuchtodo wrote: post #199

Earlier quoted context omitted.

The dentist can weather the poor investment. Knowledge does not make you financially solvent. It just improves your gambling odds as it relates to equity investment.

From my perspective, only letting people who are well off enough to 'weather the loss' seems like something that only exacerbates the wealth gap.

Super off topic, but the wealth gap is exacerbated by not taxing the wealthiest at a high enough rate, not regulations against capital market participation in highly speculative ventures. To argue that accredited investor regulations are the problem is no different than arguing for lottery tickets or penny stocks as an investment strategy for low income citizens.

Re: Insider Trading at Coinbase

#223

Post by gcthomas »

onlyrealcuzzo wrote: post #218
crystaln wrote: post #207

Earlier quoted context omitted.

You’re conflating everyone in a massive group. Americans want abortion rights then they pass laws against abortion. Can’t make this up! Developers want open source then they make closed source products. Can’t make this up!

> Americans want abortion rights then they pass laws against abortion. Can’t make this up! Literally only 32% of Americans are completely pro-choice: https://news.gallup.com/poll/1576/abortion.aspx And, actually, most Americans support limitations on abortion. I'm not sure how you came to the idea that the vast majority of Americans are pro-choice.

Your link shows 81% in favour of abortion, with or without some restrictions, with 19% against abortion. Wanting abortion rights is not synonymous with being pro-choice, which carries implications of no restrictions at all.

Re: Insider Trading at Coinbase

#224

Post by datadata »

skybrian wrote: post #165
datadata wrote: post #144

Earlier quoted context omitted.

Accredited investor rules was an example of not having a even playing field. The market is not open to everyone which contributes to unfair outcomes. I'd welcome reforms to transparency as well there, as lack of transparency also contributes to unfair outcomes (the company can exploit investors).

Could you be clearer about what you mean by transparency? Do you think private companies should make their financial statements public? Do they need to be audited?

I think trading on the basis of private information at the expense of other shareholders without the same information is the problem. I'm less concerned about the specifics of filing requirements, and more concerned about information asymmetry regardless of auditing/reporting obligations. I'm not sure I know enough to recommend a specific policy here, my original comment was just what I believe to be some of the flaws that 'crypto fans' see in traditional systems.

Re: Insider Trading at Coinbase

#225

Post by objclxt »

yrral wrote: post #149
rchaud wrote: post #128

Earlier quoted context omitted.

A lot of the rah-rah boosterism of "decentralization" is coming from VCs that saw how much money there is to be made by ignoring laws and regulations for long enough. Airbnb and Uber are the most brazen examples of this. What's left unsaid of course is that the only interest deep-pocketed investors have in dismantling elements of the financial system (MC/Visa dominance, KYC/AML checks, suspicious transactions disclos…

The concept of visa/mastercard was also largely unregulated at the time they launched. Take a look at the history of visa article on wikipeida https://en.wikipedia.org/wiki/Visa_Inc.#History Visa was not the first, and other tries to do a credit/charge before them were much worse or limited in scope. This is similar today to what is happening in web3/crypto. If you don't think the ingenuity of humans will get us some…

> This is similar today to what is happening in web3/crypto. If you don't think the ingenuity of humans will get us somewhere productive with these technologies, then I don't know what to say to you.

They won't, because they achieve nothing that can't already be accomplished with proven technologies. Axie Infinity could easily be built using regular plain old databases, but they built in on the blockchain using a terrible bridge architecture and as a result had $600 million stole. Such innovation.

Re: Insider Trading at Coinbase

#226

Post by zzbzq »

bobcostas55 wrote: post #70
pingeroo wrote: post #35

Why is the SEC so slow to regulate cryptoassets? Literally everything that they combatted for stocks and traditional assets is now taking place in the crypto ecosystem.

Insider trading doesn't apply to most "traditional" assets either. Everyone's free to trade in FX and commodities for example.

The SEC stated a few years ago it doesn't regard cryptocurrencies as securities, so that's why they don't police it. (IMO they are clearly securities, but the SEC may not want to allocate resources to policing it.)

What many people don't realize is that insider trading of assets other than securities could still potentially be criminal fraud. However without the SEC, there is no specialized police force for addressing it.

Re: Insider Trading at Coinbase

#227

Post by [deleted] »

seabird wrote: post #182
throw10920 wrote: post #117

Earlier quoted context omitted.

Yeah, the conventional financial markets are rigged, despite (or because?) of layers of regulation and "oversight" - the Robinhood-GME incident and banks/individuals that contributed to the 2008 crash getting off scott-free should have been enough to convince most individuals of this.

2008 crash is a decent example of finance being rigged. Robinhood's handling of GameStop is not. They may be a pretty shit brokerage, but DTCC collateral requirements hit everybody , and they just didn't have enough money lying around to deal with that in the way a lot of customers would have wanted.

[deleted]

Re: Insider Trading at Coinbase

#228

Post by thwayunion »

tastyfreeze wrote: post #213
thwayunion wrote: post #179

Earlier quoted context omitted.

> Accredited investor rules was an example of not having a even playing field. 1. Having an income that qualifies you as an accredited investor doesn't mean that you will have access to higher quality investments. 2. Even if you don't qualify as an accredited investor, you probably still have access to the same set of investments that a capital-poor accredited investor has access to. As an accredited investor, I've n…

Prosper.com and similar lending platforms do not require a lot of capital but users are required to be accredited investors.

On the customer side, this website offers high APY personal loans (my credit card is literally a better deal). On the investor side, the advertised rate of return is 5.7% between 2019 and 2022.

1. An effective return of 5.7% on unsecured loans with 15%-20% APY is... not a good deal. This signals either exceptionally high origination fees or extraordinary risk. Except it looks like you are investing in individual loans? So you don't even get this amortized 5.7%, but actually something that looks closer to "either 15% return or you lose your principal".

2. The rate of return is lower than every other broad asset class over that time period except for investment grade bonds, which weren't that far behind in 2019 and were probably a better deal given the enormous difference in risk profiles. Certainly high yield corporate debt was a way better deal on a risk-adjusted basis than given randos high-yield unsecured personal loans.

3. Most importantly, to my original point, you can get much higher quality exposure to high yield consumer debt via any brokerage account.

This is sort of exactly what I mean. Most of the "opportunities" widely available to accredited investors are really shit deals.

Re: Insider Trading at Coinbase

#229

Post by MegaButts »

seabird wrote: post #182
throw10920 wrote: post #117

Earlier quoted context omitted.

Yeah, the conventional financial markets are rigged, despite (or because?) of layers of regulation and "oversight" - the Robinhood-GME incident and banks/individuals that contributed to the 2008 crash getting off scott-free should have been enough to convince most individuals of this.

2008 crash is a decent example of finance being rigged. Robinhood's handling of GameStop is not. They may be a pretty shit brokerage, but DTCC collateral requirements hit everybody , and they just didn't have enough money lying around to deal with that in the way a lot of customers would have wanted.

So you agree the DTCC doesn't know how to manage their collateral requirements? It's one of their primary reasons for existing. It seems like something they should've been able to foresee or handle, rather than force brokerages into PCO when they already lost control of the situation.

It's really akin to the LME trade halt fiasco, which then became even worse when they retroactively reversed trades. The point is, when they're about to lose money they'll change the rules of the game. If you don't recognize that then you're the sucker at the table.

Re: Insider Trading at Coinbase

#230

Post by bliteben »

SkipperCat wrote: post #83

I just consider Coinbase and it ilk as "safe" places for cryptocurrency. I don't think of them as ethical in the same way I'd think of an account at TDAmeritrade, Schwab, etc. Traditional brokerage houses have regulations forcing them to play fair, and reporting structures to enforce it. Crypto exchanges are trying to convince the world they are a more secure place for your coins. Better IT security and highly funded…

Even real brokerages often make mistakes, we hear lots about the ones at Robinhood, but it happens at others too. Coinbase will not always the the luxury of undoing their mistakes.
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