Good job Gary Gensler. This is extremely important.
SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
181–190 of 489 posts
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#182Earlier 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)
It should be noted the Howey test applies to one type of security: investment contracts. There are other types of securities that the Howey test doesnt apply to.
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#183Earlier quoted context omitted.
who is buying crypto and not expecting to make a profit from it?
People buy commodities like Oil to make a profit, too. The question is, what cryptos are commodities and which are securities?
Is it a future / forward / swap / put / call / etc? Security.
Is it a barrel of oil / unit of BTC? Commodity/Currency.
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#184I 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…
> Domestic wire transfers in US takes longer and are more expensive than in Europe and developing countries such as Brazil and Argentina
Fedwires take minutes and cost nickels [1]. If you use wires frequently, get an account that doesn't charge anything for them. (The Fed is launching FedNow [2]. It will cost 4.5¢ per transfer [3].)
[1] https://www.frbservices.org/resources/fees/wires-2023
[2] https://www.federalreserve.gov/newsevents/pressreleases/othe...
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#185I 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…
Domestic wire transfers in US takes longer and are more expensive than in Europe and developing countries such as Brazil and Argentina
Do you think the US is incapable of sending an immediate message transferring money? Of course the US has that technical capability.
AML, BSA, KYC, Anti-Fraud. These are a few of the things that slow down the transfers and add to the cost. A lot of people think they're a feature, not a bug.
Then along come money transfer services that don't have these features. They'll all either get these features or they will be shutdown. There isn't a third option.
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#186Tomorrow'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.
Sure, that's what everyone said about Zhao when it was SBF's turn to be the bad guy.
With re. to Bitso specifically, a couple years ago I reached to them to let them know about a somehow serious vulnerability in their API and their response was pretty much "yeah, whatever". Really.
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#187"The S.E.C. said the world’s largest cryptocurrency exchange mixed “billions of dollars” in customer funds and secretly sent them to a separate company controlled by Binance’s founder, Changpeng Zhao." That's a criminal offense. Here's the court filing.[1] This is just a civil case for now, but expect criminal charges. "Between October 2022 and January 2023, Zhao personally received $62.5 million from one of the Bina…
The map linking companies is on page 12 for those interested.
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#188[flagged]
The victim is the tech illiterate grandmother who got sold fake money by an expensive ad, financed by cryptobros who swear up and down they're invested because it's real currency, and not so they can make a profit by indirectly scamming the tech illiterate grandmother
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#189One 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 5…
> it is only $5-100 here and there
Does anyone have withdrawal minimum that are close to $100? Most of the Kraken minimums are below $1.
It's also not true that can always empty a bank account for free. HSBC wouldn't let me sweep funds out of an account with ~$4.00 in it, for example, since it was international and the transfer fee was larger than that.
Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules
#190Earlier quoted context omitted.
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.
These are all also illegal. This doesn't take way from the parent.