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> aren't possible to comply with for crypto because of how it works Why is this? Thanks for the other detail you provided.
The SEC expects the disclosure of various types of information which are impossible to create/state in the case of a decentralized security/commodity/currency like crypto.
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> Gensler's SEC has also been intentionally obtuse about how those securities laws should apply to cryptocurrency. No. Coinbase’s complaint is that the SEC has been clear, but that they don’t like the clear answer. https://assets.ctfassets.net/c5bd0wqjc7v0/5NRidtW8lvwVEfSHpn... > Rather than initiate new rulemaking, Chair Gensler has repeatedly stated through speeches and testimony that the vast majority of digital t…
A congressman asked gensler face to face if ethereum is a security and gensler declined to answer. So no, the SEC has not been clear.
The SEC has brought zero enforcement action that turns on Bitcoin or Ether being securities. Somewhat hilariously, these complaints are an industry endemic with bullshitters flipping out about Gensler being able to say “I don’t know.”
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I promise you, a procedure to become a registered securities exchange exists (demonstrably, as registered securities exchanges exist widely) and Coinbase has enough people and money to find it. (I’m not the expert to hire for this, but https://www.investopedia.com/terms/s/sec-form-8-a.asp looks promising.)
The question is whether a procedure to become a registered exchange of crypto securities exists, and that promise seems to be a lot more dubious. Coinbase doesn't care if it can offer its customers shares of AAPL or TSLA. They care whether they can start brokering the types of securities that are found on public ledgers.
Yes, same as the others. What doesn’t exist is registration per Coinbase’s model of integrated broker, custodian and exchange. We specifically outlawed that in 1934 because it did precisely what crypto did in almost exactly the same time frame in the period stretching from 1918 (post-WWI) through the 20s’ boom years into 1933.
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So according to you, following the SEC's lead: Selling Bitcoin is legal, selling Solana is illegal, and selling ETH (Ethereum) is in a quasi-state of legal and illegal. Nobody knows exactly why any of this is the case, and that's totally fine with you because you don't want to dive into any of these "cute quirky things".
They've explained their reasoning in various spots. For example: https://www.axios.com/2022/06/28/bitcoin-is-the-only-coin-th... > Elsewhere in the speech, Hinman explained: "If the network on which [a] token or coin is to function is sufficiently decentralized — where purchasers would no longer reasonably expect a person or group to carry out essential managerial or entrepreneurial efforts — the assets may not repre…
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And the owners of that accounting software can make the case that they should be allowed to be used in the country. Lots of companies do that, and some are even successful! So you have to ask yourself... why isn't Coinbase making that argument?
> So you have to ask yourself... why isn't Coinbase making that argument? Coinbase has (obviously) always been a strong advocate of distributed ledger technology, is constantly warning of the ramifications of this software being de-facto banned in the US, and has publicly stated that they have contingencies in place for moving offshore if it's economically unviable to be headquartered in and/or serve the US market. T…
They should go. Crypto has a niche outside major economies and developed countries with the rule of law.
If you go back to the 1930s, bankers protested similarly (as they did again in the late 90s). Turns out freewheeling fraud isn’t a determinant for financial centrality. Worst case: we can revisit if London or Singapore make this work, given they’re rapidly approaching being the only financial centres who will stomach this.
Can anyone summarize what the stakes are here? Is a loss for Coinbase a company-ending event? Or is being forced to register all the coins that aren't BTC or ETH a costly regulatory burden? What are the implications of registering all these coins as securities? Does it affect whether they can be offered to non-accredited investors? How expensive is it? Who bears the costs?
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> Gensler's SEC has also been intentionally obtuse about how those securities laws should apply to cryptocurrency. No. Coinbase’s complaint is that the SEC has been clear, but that they don’t like the clear answer. https://assets.ctfassets.net/c5bd0wqjc7v0/5NRidtW8lvwVEfSHpn... > Rather than initiate new rulemaking, Chair Gensler has repeatedly stated through speeches and testimony that the vast majority of digital t…
SEC: "The vast majority of digital tokens are securities!" Anyone: "Okay then, is [insert ANY crypto here other than BTC] a security?" SEC: "We decline to answer, or give a hint, but the vast majority of digital tokens are securities!" I really don't care what happens, or how it got to this point, but this state of affairs is absolutely and unequivocally ridiculous and absurd. https://www.youtube.com/watch?v=VhA1dZXe…
The SEC has been super clear for most crypto except Bitcoin and Ether.
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The process is the same; securities are securities, crypto or otherwise. They don’t like that process, so they’re asking for a special one just for them. The SEC just said no.
My understanding is that the corporate framework that securities licenses require is literally impossible to satisfy when trading current public blockchain assets. As in, to trade crypto as a security on your exchange, you would need to walk up to every dev team of every crypto you wanted to trade and kindly ask them to KYC/AML every single user of the blockchain so that you could be in compliance. In practice this j…
Then you can't be licensed. Simple. "But I really really really want to be licensed" "..."
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>In one of the (I think MIT lectures 2018) videos, btw? Gensler stated that [probably all crypto except Bitcoin, but including Ether, are moody moody most likely securities]. As recently as 2 months ago Gensler declined to say whether or not Ether is a security in front of congress.
> Gensler declined to say whether or not Ether is a security in front of congress Whether Ether is a security is irrelevant to this case, based on an investigation which pre-dates Gensler’s term at the SEC, which is about whether Coinbase is required to register and operate as a securities exchange on account of having traded e.g. Solana. The entire argument obsessing over his refusing to come to conclusions until fa…
Sorry for the stupid questions, I really know very little about crypto. With that said, > Gensler firmly maintains that the vast majority of crypto assets are securities, with the exception of Bitcoin Why? From an article on Reuters[1], > Bitcoin is not considered a security because its anonymous and open-source origins mean investor profits are not dependent on the efforts of developers or managers, said Carol Gofor…
https://www.bloomberg.com/opinion/articles/2023-06-07/when-i...
"Some of them did securities offerings, but by the time the SEC noticed they were too entrenched and decentralized and it would have been a pain for the SEC to go after them. Ethereum, most notably, very very clearly did an ICO in 2014, raising about $18.3 million by selling ETH tokens. If they did that today, or in late 2017, the SEC would have some serious questions. But by the time the SEC got around to cracking down on ICOs in 2017, Ethereum was big and decentralized and the SEC would have had a hard time, practically and legally, challenging its 2014 ICO. And so everyone sort of grudgingly concedes that ETH is not a security."