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SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

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Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#171

Post by whiskeytuesday »

setgree wrote: post #148
gadnuk wrote: post #40

> In one instance, the Binance chief compliance officer messaged a colleague that, “[w]e are operating as a fking unlicensed securities exchange in the USA bro.” Source: https://twitter.com/JohnReedStark/status/1665748594421297152 This is a legendary quote from the filing.

My theory is that Binance execs were having these chats in an encrypted medium (e.g. WA or Signal) but didn't secure themselves against a defector. I think someone on the inside took screenshots and went to the feds (or started cooperating under legal pressure). There's even a leading candidate [0]. What's funny about this is it's a fine metaphor for what ails crypto as a whole. The technology is cryptographically se…

insert XKCD five dollar wrench comic here

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#172

Post by z3c0 »

shkkmo wrote: post #156
alphanullmeric wrote: post #108

Earlier quoted context omitted.

[flagged]

Easy agree. There are all kinds of things you can do with money that should be (and are) illegal. Hiring a hitman should be illegal. Buying slaves should be illegal. Bribing the court system should be illegal. This is not to say that every restrictions is justified, but taking the stance that no restrictions are justified is advocating anarchy.

Being a hitman should be illegal.

Selling a slave should be illegal.

Accepting a bribery should be illegal.

Chop the trunk, not the branches.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#173

Post by el_nahual »

moralestapia wrote: post #157

Tomorrow's Levine's Newsletter will be sweet :D Btw, is there a single bitcoin exchange who is operated by people that do not behave like teenagers?

Bitso out of Mexico/Brazil is about as serious as any company can be IMHO.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#174

Post by tibbon »

One thing I noticed, which always felt possibly-illegal, was how Binance and other exchanges would frequently freeze up funds that didn't meet minimum withdraws. If a coin fell to too-low of a price, they'd essentially just keep them. Sure, it is only $5-100 here and there, but that all adds up. Where does it go?

With a real bank or exchange, I'd expect some ability to sweep up my accounts and get a paper check for 50 cents if needed.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#177

Post by Animats »

jcranmer wrote: post #81
johndhi wrote: post #69

Earlier quoted context omitted.

what's stupid is that quotes like this, not actual substance of what their business practices are, are the only way the SEC can establish what is and isn't a "security." there is no real truth or objective test and the SEC has offered no meaningful guidance. so they just determine this based on subjective emails the CEO sent once.

The definition of "security" is pretty objective (Howey test), but the answer it produces tends not to be liked by people in the crypto space, so they argue hard about why it's not a definition of security. What quotes like these do is make it trivial to prove the mens rea (intent) requirements, and put a lie to claims that they didn't know it was a security or that their interpretation as not-a-security was reasonab…

> The definition of "security" is pretty objective (Howey test), but the answer it produces tends not to be liked by people in the crypto space, so they argue hard about why it's not a definition of security.

This. The Howey test really is clear. If there's an issuer behind a crypto asset, it's a common enterprise for Howey Test purposes. Bitcoin has no issuer at this point. Etherium, maybe. Just about everything else in crypto has an issuer raking off the profits.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#179

Post by mikem170 »

wslh wrote: post #110

I remember the last post from Fred Wilson: "The Freedom To Innovate" [1]. Even if the SEC is right about Binance and others, and there are without doubt blatant and huge frauds in Web3, there are huge problems with the financial modernization within the US (and the world). Domestic wire transfers in US takes longer and are more expensive than in Europe and developing countries such as Brazil and Argentina. The SEC is…

> The Freedom To Innovate

I'm not sure that innovation in finance has always been a good thing. Over the last 50 years we've seen increased levels of debt, increased college costs, increased housing prices, a bigger and more powerful rentier class, growing income inequality, leveraged buyouts, big business eliminating small businesses, hedge funds buying housing and hospitals, big tech buying up the competition, profit is the name of the game, all of these rich people buying politicians, etc. Who came out ahead after all this?

Much of the applied innovation in crypto hasn't been good, either. Block chain is an amazing technology, but the innovators in this space didn't stop at a decentralized money transfer system, they wanted to get rich and they scammed people.

So what kind of innovation are we talking about? Who would be helped?

> Domestic wire transfers in US takes longer and are more expensive than in Europe and developing countries such as Brazil and Argentina

A small aside on this topic: I assume/hope that the new FedNow payment system coming online in a month or so will help with transfers like this.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#180

Post by lijok »

alphanullmeric wrote: post #108
whateveracct wrote: post #103

Earlier quoted context omitted.

Point one just sounds like your opinion that securities regulations should not exist. Seems like a little stump-box-y to post in a thread about high-profile, blatant securities law criminality lol.

[flagged]

Disagree. I should be able to use my money to hire someone to kick you in the nuts.
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