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US SEC sues Coinbase, one day after suing Binance

reuters.com

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Re: US SEC sues Coinbase, one day after suing Binance

#41

Post by matheusmoreira »

gonzo41 wrote: post #15
TimPC wrote: post #2

Crypto companies think they don't trade securities which is clearly wrong and contradicted by their own advertising. People buy crypto without a real use for crypto because they think they can sell it for more later. Everyone under the sun knows this. It's obviously a security and failing to register should be met by SEC cases like this one.

What's the use of crypto again? Because I think it's kinda useless. Just like NFT's

Monero is private and perfectly usable for payments. I've gotten paid in Monero, works great. People just need to start using it.

Re: US SEC sues Coinbase, one day after suing Binance

#42

Post by EddieEngineers »

paulpauper wrote: post #36

Crypto is like the worst investment ever: huge legal risk, does not hedge inflation, not a safeguard in crisis, does not benefit from tech/ai boom, does not generate profits. Only downside, no upside, no strengths, only weaknesses. the chart is only one direction: down The obvious weakness of bitcoin relative to QQQ demonstrates this. A daytrading pair trade method that shorts Bitcoin in market hours and goes long qq…

This is true when it’s going down and false when it’s going up. Do the same analysis of previous years during bull crypto markets and does this hold up?

Re: US SEC sues Coinbase, one day after suing Binance

#43

Post by wins32767 »

hirako2000 wrote: post #19
dragontamer wrote: post #5

Earlier quoted context omitted.

Article discusses Coinbase Earn, which was a staking service providing APY yields. Is that not an unregistered financial product? That's also the kind of financial product directly behind FTX, Voyager, Gemini, and Lunacoin / Celsius collapses. So we have direct evidence of a particular produce (staking) that is both unregistered and dangerous. That many Americans lost money over.

Gemini didn't collapse, and an evidence takes a bit more clarity to be treated as such. Luna is.. a coin Can't you get APY returns as a retail customer with pretty much any high street banks? In what ways is that less dangerous than going through a crypto exchange: by the fact the SEC is actively criminalising the activity rather than issuing licenses so that some customer protection via the justice system remains ou…

>Can't you get APY returns as a retail customer with pretty much any high street banks? In what ways is that less dangerous than going through a crypto exchange:

Well, given that there are clear ways of issuing securities that have worked for hundreds of years that aren't being followed and that people generally don't get the rug pulled in normal securities, I'd say that it's less dangerous in many obvious ways.

Re: US SEC sues Coinbase, one day after suing Binance

#44

Post by isp »

TimPC wrote: post #2

Crypto companies think they don't trade securities which is clearly wrong and contradicted by their own advertising. People buy crypto without a real use for crypto because they think they can sell it for more later. Everyone under the sun knows this. It's obviously a security and failing to register should be met by SEC cases like this one.

> Crypto companies think they don't trade securities

To quote the Binance Chief "Compliance" Officer: "we are operating as a fking unlicensed securities exchange in the USA bro"

Source: Quoted in the filing yesterday where SEC sued Binance

> 111. As Binance’s CCO bluntly admitted to another Binance compliance officer in December 2018, “we are operating as a fking unlicensed securities exchange in the USA bro.”

https://www.sec.gov/files/litigation/complaints/2023/comp-pr...

Re: US SEC sues Coinbase, one day after suing Binance

#46

Post by paulpauper »

EddieEngineers wrote: post #42
paulpauper wrote: post #36

Crypto is like the worst investment ever: huge legal risk, does not hedge inflation, not a safeguard in crisis, does not benefit from tech/ai boom, does not generate profits. Only downside, no upside, no strengths, only weaknesses. the chart is only one direction: down The obvious weakness of bitcoin relative to QQQ demonstrates this. A daytrading pair trade method that shorts Bitcoin in market hours and goes long qq…

This is true when it’s going down and false when it’s going up. Do the same analysis of previous years during bull crypto markets and does this hold up?

bitcoin's performance since late 2017 lags QQQ. the rolling 5-year returns have gotten way worse. Much of the gains were from pre-2018. many people five years ago were predicting six-figures by now, nowhere even close.

Re: US SEC sues Coinbase, one day after suing Binance

#47

Post by itake »

andreygrehov wrote: post #40
dragontamer wrote: post #5

Earlier quoted context omitted.

Article discusses Coinbase Earn, which was a staking service providing APY yields. Is that not an unregistered financial product? That's also the kind of financial product directly behind FTX, Voyager, Gemini, and Lunacoin / Celsius collapses. So we have direct evidence of a particular produce (staking) that is both unregistered and dangerous. That many Americans lost money over.

> That many Americans lost money over. This requires a citation with data points, eg how many Americans lost money, how much money did they lose, etc. Because, what if there are more Americans who've made money than those who have lost? > SEC said Coinbase has since at least 2019 made billions of dollars by handling cryptocurrency transactions, while evading the disclosure requirements meant to protect investors This…

> Because, what if there are more Americans who've made money than those who have lost?

Why does this matter? Even if Americans are scamming foreigners (0 Americans losing money), that doesn’t make this legal.

The difference between aapl and coinbase is there is regulatory audits of the books and required publications about the health of the security. There are rules about insider trading and insurance protections if a brokerage mishandles your money (see Blockfi).

Re: US SEC sues Coinbase, one day after suing Binance

#48

Post by butlerm »

If you look up the definitions of "security", "financial instrument", "commodity", and "currency", it is pretty clear that a plain vanilla crypto-currency like Bitcoin is no ordinary security nor a financial instrument. It is not a claim on something else, even less so than a traditional bank note. It is more like a commodity. Since when is "aluminum" a security?

A crypto currency business however may be engaged in trading of crypto currencies which are negotiable financial instruments, and a stable coin that is a claim on a traditional currency is an example of that. A stable coin bears a direct relationship to a bank note. It is a claim on something else. It is not really an investment though, so not much of a security.

And then of course there are more creative negotiable financial instruments which are definitely securities. Options, derivatives, swaps, futures, and the like.

The Supreme Court has a broader definition of securities, that involves a promoted investment in a "common enterprise", but it is unclear that a commodity currency really is a common enterprise like a corporation is for example. It seems unlikely to me that Bitcoin as such would even meet that definition of a security. But other products offered by crypto currency exchanges might.

Re: US SEC sues Coinbase, one day after suing Binance

#49

Post by dragontamer »

andreygrehov wrote: post #40
dragontamer wrote: post #5

Earlier quoted context omitted.

Article discusses Coinbase Earn, which was a staking service providing APY yields. Is that not an unregistered financial product? That's also the kind of financial product directly behind FTX, Voyager, Gemini, and Lunacoin / Celsius collapses. So we have direct evidence of a particular produce (staking) that is both unregistered and dangerous. That many Americans lost money over.

> That many Americans lost money over. This requires a citation with data points, eg how many Americans lost money, how much money did they lose, etc. Because, what if there are more Americans who've made money than those who have lost? > SEC said Coinbase has since at least 2019 made billions of dollars by handling cryptocurrency transactions, while evading the disclosure requirements meant to protect investors This…

> This requires a citation with data points, eg how many Americans lost money, how much money did they lose, etc.

My coworker lost $X0,000 over Celsius.

So yes, maybe this is a personal bias. But its based in reality. His entire account at Celsius is written off. He managed to save his money from Voyager. I got cousins who lost money in FTX. Different people, but same overall problem.

If my personal social circle is showing huge losses in these companies, I have to imagine that other people out there have similar experiences. I don't need a study to prove the facts, I just talk to my cousins / coworkers / other people who are directly affected.

EDIT: I forgot about this lovely thing: https://cases.stretto.com/public/x191/11749/PLEADINGS/117491...

See page 34, containing links to the customers who lost money in celsius. For the list of customers starting with the letter "A": https://cases.stretto.com/public/x191/11749/CORRESPONDENCE/1...

There, that's Celsius alone. Is that enough proof for ya?

> Because, what if there are more Americans who've made money than those who have lost?

Its not about making or losing money. Its about accounts disappearing because they've been lied to.

We're all adults here. We know that investments can lose money. But lying about those investments is where the law needs to step in. Liars need to be punished. And I get that people have been skirting the truth recently. But when we get to Celsius, Voyager, and FTX, the money was just straight up being stolen. Its the worst case offenders.

So now we need to think about what kind of culture caused these crimes. And its increasingly looking like "staking", and the culture surrounding it, is to blame.

Re: US SEC sues Coinbase, one day after suing Binance

#50

Post by dforrestwilson »

butlerm wrote: post #48

If you look up the definitions of "security", "financial instrument", "commodity", and "currency", it is pretty clear that a plain vanilla crypto-currency like Bitcoin is no ordinary security nor a financial instrument. It is not a claim on something else, even less so than a traditional bank note. It is more like a commodity. Since when is "aluminum" a security? A crypto currency business however may be engaged in t…

Getting sued to fall under govt regulation - and therefore gaining imprimatur - seems like exactly what these exchanges should want.

We never regulated Beanie Babies.

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