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Insider Trading at Coinbase

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Re: Insider Trading at Coinbase

#281

Post by nybble41 »

skybrian wrote: post #246
datadata wrote: post #224

Earlier quoted context omitted.

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 flaw…

Okay, fair enough! However, reporting requirements and auditing are all about making sure everyone has access to the same, accurate information about a company's financial situation. Insiders will learn about changes in a company's finances before outsiders. If they can disclose this to some investors but not others, or even disclose it to some investors first, then that increases information asymmetry. But this does…

As I see it, insider trading rules are less about "information asymmetry" and more about avoiding conflicts of interest between the decision-makers in a company and the investors they are supposed to be working for. It is a given that not everyone will have exactly the same information—combining all those separate viewpoints to arrive at a single market price is why the market exists. However, the insiders have a duty to their employers—the shareholders—and insider trading puts the insiders' personal profit at odds with the decisions which will best benefit the company. They weren't given access to that information and a position where they can guide the direction of the company for the purpose of enriching themselves at their principals' expense.

The difference being: Under this interpretation insider trading is purely a dispute between the shareholders and their hired employees / agents. No one else has any standing.

Re: Insider Trading at Coinbase

#282

Post by dlp211 »

gcthomas wrote: post #223
onlyrealcuzzo wrote: post #218

Earlier quoted context omitted.

> 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.

I hope I didn't misunderstand what you wrote, but where did you get the idea that being pro-choice means the ability to get an abortion from 0 months to 9 months pregnant?

There is obviously a spectrum to being pro-choice, but if I had to bet I'd put the majority of pro-choice folks follow: that woman has the right to choose to have an abortion while the fetus is generally considered pre-viability by the medical profession and under extreme circumstances where the life of the mother is at risk and/or the baby is now non-viable or will suffer a short and traumatic life.

Re: Insider Trading at Coinbase

#283

Post by matheusmoreira »

reedjosh wrote: post #257
matheusmoreira wrote: post #251

Earlier quoted context omitted.

> How are people going to pay their taxes The government is going to have to suck it up and accept taxes in cryptocurrency. In my country such laws have already been proposed.

I love this. Yeah, they'll have to allow for off ramps or accept crypto for tax payments. I say have to as otherwise a rich private currency economy will grow unmolested by tax collectors.

> rich private currency economy will grow unmolested by tax collectors

Honestly I wouldn't mind that either. Governments in general are absurdly corrupt and taxes finance that corruption the same way drug users finance cartels.

Re: Insider Trading at Coinbase

#284

Post by nybble41 »

izzydata wrote: post #201
berberous wrote: post #189

Earlier quoted context omitted.

This is a strawman. It also paints “crypto fans”, as some monolithic group that all think the same way. I am a crypto fan and do not “want deregulated finance”. It is not “exactly what crypto is all about”. I think most in the space would actually like to see more sensible regulation.

I think "crypto people" are tired of things being a constant state of flux and just want governing bodies to make some kind of decisions. People really want to know what the rules are so they can make more informed decisions.

This is quite true. Many of the calls for regulation by "crypto people" which I've seen are really just a reaction against an uncertain regulatory environment. In short, they just want the regulators to make up their minds already. The biggest wildcard and source of volatility in the crypto space, IMHO, lies in the inconsistent and unpredictable responses we've seen from politicians and bureaucrats, not the tech, the state of the market, or the possibility of falling for some kind of scam.

However, one should keep in mind that certainty is not necessarily better—it depends on what the rules are. Operating in a grey area is better than being banned outright, and overly strict regulation can nullify all the advantages of a new system by forcing it into the mold of the old system it's meant to replace. The ideal outcome is that they explicitly adopt a hands-off approach so that the threat of adverse regulation is removed without being replaced by known adverse regulation in the present.

Re: Insider Trading at Coinbase

#286

Post by FabHK »

perihelions wrote: post #10

Is this insider trading according to the law? Nonpublic information isn't being used to trade public stocks; it's being used to trade assets that don't appear to be regulated securities.

Point on insider trading law that the inimitable Matt Levine writes about frequently:

The law is not about fairness, but about theft (of inside information). In particular, it is illegal to misappropriate someone else's information you come across to do insider trading for your own benefit. But it is not illegal for someone to use their own information to trade on.

In this case, Coinbase published a list of coins that it might list. As I understand it, it would be illegal if some employee of Coinbase bought these coins prior to the release for his own account (thereby misappropriating the information). But if Coinbase bought them for their account, and then released the list, and then made money on the subsequent rise, that would be perfectly legal.

See for example here:

https://www.bloomberg.com/opinion/articles/2019-03-13/you-ha...

Re: Insider Trading at Coinbase

#287

Post by ckastner »

TruthIsHeresy wrote: post #124
ckastner wrote: post #120

Earlier quoted context omitted.

This is so on point. To me, and many others active somewhere on the "regulated finance" spectrum, the way crypto kept going on and on how awesome "deregulation" is from a consumer standpoint was tragically ironic. The vast majority of regulation is there to protect market participants.

>The vast majority of regulation is there to protect market participants. Anyone involved with GME knows this isn’t true.

> Anyone involved with GME knows this isn’t true.

People involved with GME used to refer themselves as the "Apes", and reading their main forum on /r/wallstreetbets back then, that would be a pretty accurate characterization of what they "know".

Re: Insider Trading at Coinbase

#288

Post by nybble41 »

ceejayoz wrote: post #160
TruthIsHeresy wrote: post #122

Earlier quoted context omitted.

>Crypto fans get mad when deregulated finance is comically unfair. I’m curious as to where you’ve seen this sentiment from crypto fans? It seems most of the people getting angry about this are people who already disliked crypto and are using this event to add more fuel to the flames.

> I’m curious as to where you’ve seen this sentiment from crypto fans? I mean, Ethereum itself forked over "hey that's no fair" when the DAO got compromised.

That's not a general observation about all, or even most, "crypto fans" as the earlier comment implied but rather just part of the Ethereum community. And it was still decentralized, as a majority of the users of Ethereum had to agree to the fork before it could take place. The DAO fork was a bad decision and set a poor precedent but it's unlikely to be repeated—a fork in the chain at this point would have too much impact on too many other tokens to be a viable solution to a single buggy smart contract.

Re: Insider Trading at Coinbase

#289

Post by nybble41 »

Sohcahtoa82 wrote: post #233
bogota wrote: post #232

Earlier quoted context omitted.

What does this even mean? I’m a crypto fan but I dont want to deregulate finance completely. So maybe i’m not a crypto fan. Or maybe the crypto fan online isn’t really representative of reality like most online communities that are largely based off what reddit is spouting. Im not close to being alone on this. I don’t know anyone in my life who is a “crypto fan” and doesn’t think rules should exist around exchanges.…

Just like any other group of people, crypto fans are not a monolith. There certainly are some extreme libertarians that think nothing in the financial world should be illegal and that the Free Market(tm) will sort everything out on its own. To them, insider trading isn't unethical, quite the opposite. People should be using every advantage at their disposal. To them, getting a job at Coinbase to get the inside scoop…

> To them, insider trading isn't unethical, quite the opposite.

This does not follow. Even under the most "extreme libertarian" position insider trading, narrowly construed, would still be an unethical violation of the agent/principal relationship which exists between the employee and the company's owners (the shareholders). Abusing confidential information you have access to as a result of your position for personal gain at the expense of the shareholders would be violation of trust—and most likely a direct breach of your employment contract.

Re: Insider Trading at Coinbase

#290

Post by FabHK »

rvz wrote: post #38
beaconstudios wrote: post #20

Earlier quoted context omitted.

Based on both my observations of the space and interaction with crypto people and the crypto market. I know people who work in crypto too. Your defensive kneejerk reaction doesn't serve as an opposing argument - if you think differently, all you need to do is provide some evidence.

> find a crypto business that isn't rooted in some kind of scam, greater fool scheme, pyramid scheme, or the like. > If you think differently, all you need to do is provide some evidence. So is this product a 'scam' then? [0] [1] [0] https://skiff.org

Thanks, that looks interesting, but I don't see the connection to "crypto", except it being encrypted, laudably.
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