US SEC sues Coinbase, one day after suing Binance • Hacker News Board

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

#271

Post by hirako2000 » Tue, Jun 06, 2023, 6:02 PM UTC

seydor wrote: post #70

hirako2000 wrote: post #39

Earlier quoted context omitted.

Mad because some entrepreneurs makes the effort to build legitimate business entities, and what certain governments find to do is any scheme to keep them out of legitimity. Not that crypto fans would care all that much about these businesses, but there is a need to onramp and offramp given transactions are made in their vast majority in fiat. An exchange run as a business having at least a lot at stake in ensuring co…

it's not like these onramps served the real purpose of digital currency. People don't buy bitcoin in order to pay for services, they buy it to speculate. Bitcoin could succeed even without onramps; digital workers can easily accept bitcoin if they care, which over time will be traded with goods in the physical world with other people who care. That's grass roots deployment, not VC-backed "legitimate" ponzi exchanges.…

The offramp / onramp is necessary so long as we have two systems, we need a gate between the two, even if crypto had 10 times its current level of trading transactions, as in trading of good or services for crypto, there would still be a large imbalance where more income would be taking fiat in. Adoption is happening, surely less so or far slower in the developed nations like in the US, but is not contracting globally. Unless all fiat currencies were to suddenly collapse, the bridge is needed. And, even if the wildest adoption was to take place, there will likely still be centralised issuers here and there, some countries sitting on paper money which would make off ramping a very long term need.

Interesting comment, I like the parallel with the boomers era. Crypto may just take over once throw genX take over in far greater numbers, get elected, and the few old recalcitrant putting obstacle get cornered.

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

#272

Post by ethanbond » Tue, Jun 06, 2023, 6:06 PM UTC

dcow wrote: post #212

davidgerard wrote: post #181

Earlier quoted context omitted.

> 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).

Bitcoin was literally designed to circumvent state monetary systems and their affiliated controls. Almost all the crypto descendants follow this path as well.

So yes, it was by design that it’s hard to regulate.

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

#273

Post by JumpinJack_Cash » Tue, Jun 06, 2023, 6:06 PM UTC

whimsicalism wrote: post #162

this_user wrote: post #154

Earlier quoted context omitted.

I think it's more a case that anyone who was involved in crypto early, and who has actually taken the time to understand the technology, has realised about a decade ago that crypto currencies are mostly useless. But then people had they idea that they could still make money from it by grifting people if they just added layer upon layer of complexity in order to disguise the ultimate uselessness of the underlying tech…

> I think it's more a case that anyone who was involved in crypto early, and who has actually taken the time to understand the technology, has realised about a decade ago that crypto currencies are mostly useless. I don't know what it is about crypto that makes HN commentators want to make the most ridiculous, put-downy statements without evidence to back it up. Crypto is not mostly useless, it is just that people do…

> > crypto is absolutely massive for avoiding capital controls in countries with inflation

Inflation hedge means mantaining parity against a weighted basket of stable currencies such as USD/EUR/CHF/JPY. Maybe gold?

Bitcoin didn't mantain parity at all, it's up some 20,000% since 2013 and +∞ since its inception.

So crypto failed as inflation hedge too, because the world of finance is very specific, you can't say 'this asset is an inflation hedge' and then it's up 20,000%

It also failed as a tool for capital controls and tax evasion because if you do that sort of things you don't want publicity...what happened is that crypto-bros and crypto-enthusiast went on to scream off the top of their lungs and it resulted in the death of the largest capital control avoidance use case: getting money out of China.

Nobody uses Crypto for getting money out of China anymore.

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

#274

Post by nradov » Tue, Jun 06, 2023, 6:08 PM UTC

sroussey wrote: post #251

nradov wrote: post #205

Earlier quoted context omitted.

In general if you're thinking of doing something in a gray area of federal law or regulations then you can write a formal letter to the competent regulatory agency and request an opinion. But you have to be extremely specific and pose your questions in ways that can be answered with a clear yes or no; you can't expect a useful response to a vague request for clarifications or definitions. If the agency does give you…

FundersClub did this for creating a portal to invest in startups.

Right, good example. You can read the SEC letter here. As long as you ask the right questions you can get useful answers and protect your business.

https://www.sec.gov/divisions/marketreg/mr-noaction/2013/fun...

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

#275

Post by [deleted] » Tue, Jun 06, 2023, 6:09 PM UTC

scottiebarnes wrote: post #245

mulmen wrote: post #204

Earlier quoted context omitted.

Trading something doesn’t consume it. That’s a very confusing overloading of terminology.

Well consumer comes from the base word consume, which by definition includes the buying of a good or service, which is essentially a trade. Consume: - eat, drink, or ingest (food or drink). - buy (goods or services). - use up (a resource). - (especially of a fire) completely destroy. - (of a feeling) absorb all of the attention and energy of (someone).

[deleted]

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

#276

Post by JumpinJack_Cash » Tue, Jun 06, 2023, 6:09 PM UTC

lottin wrote: post #129

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…

But what on earth is a digital commodity? I think the whole concept of digital commodity is nonsensical. A commodity is a product. Products are either consumed or used as raw materials. A digital commodity is not a product. It can't be consumed or used, because it's entirely imaginary. I think a better term is "abstract unit of account".

You can consume a Fortnite skin or a Call of Duty weapon.

The point is that you cannot consume crypto, it's a problem which is understood inside the community, that's why the push for NFTs which started as legitimate art to enjoy on huge 8K screens or VR headsets but quickly ended up becoming Twitter avatars built for the purpose of trading and offloading to a bigger fool.

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

#277

Post by Consultant32452 » Tue, Jun 06, 2023, 6:09 PM UTC

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…

Are there any crypto tokens not backed by a state that the SEC has officially and clearly declared a currency and not a commodity?

I'm starting to feel, as a practical matter, they will never consider non-government backed crypto a currency regardless of what the rules on paper are. But maybe this has already happened and I'm ignorant, I don't follow this space closely.

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

#278

Post by JumpCrisscross » Tue, Jun 06, 2023, 6:10 PM UTC

whimsicalism wrote: post #217

earnesti wrote: post #199

Earlier quoted context omitted.

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. > Jus…

> people saying 'regulations are perfectly clear' on this issue have not spent that much time dealing with regulators in emerging technology

I work in a regulated industry. I have my criticisms of Gensler. And I’ve (separately) profited off crypto.

The regulations for non-Bitcoin exchanges were clear from the start. Nobody liked that clarity. And the regulators spent a few years navel gazing. But the legal advice I got at the start has remained consistent: the operators are putting themselves in jeopardy.

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

#279

Post by mulmen » Tue, Jun 06, 2023, 6:10 PM UTC

scottiebarnes wrote: post #245

mulmen wrote: post #204

Earlier quoted context omitted.

Trading something doesn’t consume it. That’s a very confusing overloading of terminology.

Well consumer comes from the base word consume, which by definition includes the buying of a good or service, which is essentially a trade. Consume: - eat, drink, or ingest (food or drink). - buy (goods or services). - use up (a resource). - (especially of a fire) completely destroy. - (of a feeling) absorb all of the attention and energy of (someone).

I was asking an honest question but I don't like being trolled. Have a nice day.

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

#280

Post by dbmikus » Tue, Jun 06, 2023, 6:12 PM UTC

JumpCrisscross wrote: post #253

arctek wrote: post #203

Earlier quoted context omitted.

Except that it would exclude a raft of non-US citizens then, i.e. any sanctioned country, Coinbase would also need to become registered as an ATS and their current settlement and clearing processes would need to be re-engineered from the ground up. For all intents and purposes you cannot register a cryptocurrency with the SEC and then go on trading it anywhere publicly - it doesn't exist. There's only been a few proj…

> it would exclude a raft of non-US citizens then, i.e. any sanctioned country This lays bare the problem with the status quo . Wanting to profit off sanctions busting isn’t a sympathetic pitch.

In some cases, I find it sympathetic. For example, I don't think it's a clear cut moral resolution that people should exclude Iran from buying US goods and services, but they are on the sanctioned list. I supported Obama dropping sanctions on Iran back when he was president.

There's a difference between what is legal and what is moral. For what is moral, there are hardly any absolute answers.