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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

#211

Post by whimsicalism »

sealeck wrote: post #208
whimsicalism wrote: post #184

Earlier quoted context omitted.

Interesting, maybe you should let Gensler know that the law is much more obvious than he appears to realize [0] [0]: https://youtu.be/VhA1dZXeao0?t=58

Is it really surprising that the chair of the SEC cannot just dispense SEC positions without consulting with lawyers?

Has Gensler never consulted lawyers on the status of ethereum prior to this hearing?

It should be easy yes or no from the lawyers, I'm hearing that the law is incredibly clear and not really prone to misinterpretation so it shouldn't be an issue. Or maybe Gensler's lawyers are "extremely inexperienced" if they couldn't figure out such an obvious issue?

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

#212

Post by dcow »

davidgerard wrote: post #181
dcow wrote: post #116

Earlier quoted context omitted.

I don't think the pure commodity coins (layer 1 networks like btc, xch, etc) are confusing at all. You do work and get rewarded with a digital commodity. It’s exactly like digging up gold, or tapping a tree for maple syrup. Then a bunch of crypto anarchists showed up and started speculating that these coins would be worth a lot in the future because we could topple the financial hegemony by their powers combined. Oka…

> Then a bunch of crypto anarchists showed up they literally started bitcoin and were the guys mapping out what they wanted from a digital currency over the previous twenty years, this is well known history

My point is simply that crypto requiring a nuanced legal treatment is not implicitly by design even if it was promoted as a feature early on by grifters and anarchists. It’s a technology like any other and it’s the regulators’ job to create fair and appropriate treatment for it (and our job to elect ones who will).

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

#213

Post by antasvara »

dcow wrote: post #116
ethanbond wrote: post #61

Earlier quoted context omitted.

I think the real crux of the issue is that these instruments were designed to be confusing to regulate and, alas, they're confusing to regulate. The error was in thinking that a confused regulator says "I don't understand what's going on here, carry on and rest easy" rather than what actually happens: "I don't understand what's going on here, and until I do -- on my schedule, not yours -- your business is always at r…

I don't think the pure commodity coins (layer 1 networks like btc, xch, etc) are confusing at all. You do work and get rewarded with a digital commodity. It’s exactly like digging up gold, or tapping a tree for maple syrup. Then a bunch of crypto anarchists showed up and started speculating that these coins would be worth a lot in the future because we could topple the financial hegemony by their powers combined. Oka…

Where the definition gets confusing is when a cryptocurrency gives you voting rights to modify the underlying protocol, or determine the direction of an entity that manages the underlying protocol, etc.

There isn't (AFAIK) a commodity that operates in this manner. Owning a lot of gold doesn't mean that I'm able to unilaterally adjust how gold is mined or obtained, for example.

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

#214

Post by anonymouskimmer »

darksaints wrote: post #171
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…

So many of these HN conversations devolve into shit bonanzas because so many people approach this topic as if it is a "Regulation vs No Regulation" topic, instead of the more appropriate "Bad Regulation vs Good Regulation" topic, or even more appropriately the "Which agency should have jurisdiction" topic. And it is a shame, because cryptocurrency has largely outgrown the anarchocapitalist utopian's mindshare, and th…

> And from my handful of years as a commodities trader

If crypto was limited to commodities traders we wouldn't have had nearly the number of problems we have had.

> The vast majority of cryptocurrencies (modulo a bunch of shittokens)

You can't eliminate a huge part of the sector that the exchanges are actively involved in trading.

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

#215

Post by paulddraper »

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…

> Crypto currency is a commodity

Could you explain this to me?

Are there any other examples of non-physical commodities?

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

#216

Post by strbean »

jmyeet wrote: post #159

Here's my take on crypto: 1. Despite any theoretical applications, all applications of crypto thus far have been to bypass laws. Some of these might be moral (eg avoiding currency controls in some countries like Venezuela) but mostly it's just illegal stuff; 2. No one is really interested in applications. They're "hodling" [sic] because of Bitcoin FOMO. They want in on the next Bitcoin. 3. Scams and rug pulls are rif…

> 1. Despite any theoretical applications, all applications of crypto thus far have been to bypass laws.

Not so: https://en.wikipedia.org/wiki/Bitcoin_in_El_Salvador

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

#217

Post by whimsicalism »

earnesti wrote: post #199
whimsicalism wrote: post #184

Earlier quoted context omitted.

Interesting, maybe you should let Gensler know that the law is much more obvious than he appears to realize [0] [0]: https://youtu.be/VhA1dZXeao0?t=58

Crypto people constantly point to this video as some kind of evidence that the SEC is clueless. Maybe it just doesn't make sense for them to give clear answers in that kind of hearings,or answers related to specific crypto token. Just normal for government officials to cover their own asses primarily and giving specific guidance related to a specific issue at a hearing doesn't just serve them well.

I don't own any crypto [outside of very small curiosity amounts when I was playing with it to figure out how it works years ago] nor do I consider myself a 'crypto person' (only, perhaps, compared to the backdrop of extreme HN negativity around the topic). I just think that people saying 'regulations are perfectly clear' on this issue have not spent that much time dealing with regulators in emerging technology.

> Just normal for government officials to cover their own asses primarily

I agree - I just disagree with people suggesting that the same logic doesn't apply to regulators and their actions.

They want to keep it unclear precisely so they have the ability to maneuver in the future and regulate if they want. That is the exact opposite of the 'super clear' regulations & guidance that GP was suggesting currently exists.

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

#218

Post by x86x87 »

modeless wrote: post #160

The specific crypto tokens they are classifying as securities are: SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH, and NEXO. Of course they say "not limited to" to hedge their bets, but those are the ones they specifically mention. This is the exact "regulatory clarity" Coinbase has been asking for, but the SEC prefers to sit on their hands for years (while investors are "harmed") and then sue, rath…

Hah. Protecting investors. What a bunch of croc. This was never about protecting investors. If it was they would have issues the guidance 5 years ago. This is about blowing up crypto in general by removing the on/off ramps (ie the exchanges).

Also: mandatory crypto is bad for the environment and it consumes more power than the whole country of Argentina! /s But nobody seems to care or talk about how much power crapGPT is consuming. The future they tell me

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

#219

Post by asveikau »

isp wrote: post #44
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:…

I hear if you add "bro" to a statement it makes you immune from prosecution.

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

#220

Post by paulddraper »

vkou wrote: post #123
dcow wrote: post #105

Earlier quoted context omitted.

There are two modalities to crypto and the law needs to treat them differently. Running a node on a crypto currency network does not generate securities. It generates commodities. We don't tax people on the FMV of gold when they dig it out of the ground. But, speculating on the price of gold by creating a virtual token/contract/etc. and selling that, well that’s obviously a security. Just because people buy gold spec…

> We don't tax people on the FMV of gold when they dig it out of the ground. Why shouldn't we? We tax people on the FMV of something valuable created out of thin air, why should gold be an exception?

> We tax people on the FMV of something valuable created out of thin air,

There are income taxes which apply when goods or services are sold.

There are sales taxes when goods are purchased.

There are property taxes when goods are owned.

Nothing gets taxed on creation.

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