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“But the SEC let us go public” and other flawed arguments in Coinbase's defense

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Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#161

Post by Dylan16807 »

KingOfCoders wrote: post #130
shagie wrote: post #115

Earlier quoted context omitted.

SEC filing by Coinbase as a free writing prospectus related to their S1 - https://d18rn0p25nwr6d.cloudfront.net/CIK-0001679788/334fdd0... QUESTION 17: “Coinbase plays the role of both broker, executing trades on behalf of clients, as well as an exchange, matching buyers and sellers. This is a unique situation. In other markets, i.e. equities, a broker would be required to be legally independent of an exchange. Could…

"What I think is important about the Coinbase business model is that we have set up our business such that there's not a conflict." We have illegal weapons but what is special with us, we won't use them. So it's not illegal.

No, because they also argue the weapons are not illegal. Your analogy implies they said "yes they are securities", and they definitely didn't do that.

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#162

Post by mthoms »

JumpCrisscross wrote: post #137
mthoms wrote: post #68

Earlier quoted context omitted.

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…

> Anyone: "Okay then, is [insert ANY crypto here other than BTC] a security?" The SEC has been super clear for most crypto except Bitcoin and Ether.

Really? Where can I learn about which cryptocurrencies constitute securities and which don't? Is there a list?

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#163

Post by Animats »

jbverschoor wrote: post #104
jcranmer wrote: post #66

Earlier quoted context omitted.

Then you stopped reading right before you got to the part of the article that really highlights the central lie of Coinbase: > Coinbase, as with most crypto platforms, has decided it wants to simultaneously operate as an exchange, broker-dealer, and clearing agency. These three functions — bringing together securities orders for buyers and sellers, trading securities on behalf of others, and intermediating trades — a…

No that’s not the case. Coinbase wants CLARITY. The SEC does not give any guidance, response, or anything related to this issue. At the same time it’s a laat struggle between the SEC and the CFTC. The SEC messed up for years but not protecting consumers against fraud. Now they’re trying to prove their reason existence / gov funding. In one of the (I think MIT lectures 2018) videos, btw? Gensler stated that [probably…

Coinbase has clarity. The SEC is saying "What part of 'no" did you not understand?"

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#165

Post by Dylan16807 »

stickfigure wrote: post #158
bb88 wrote: post #127

Earlier quoted context omitted.

TIL to stop reading the top voted comment if it appears to be outrage and just read the article for myself instead. Just FYI here's the quote in context. She's posing a hypothetical here and not actually comparing Coinbase to a heroin dealer. This is very much in the style of Matt Levine at Bloomberg, btw. If a company went to the FDA and said “hello, we’d like to start selling heroin to the public for recreational u…

She's comparing cryptocurrency to heroin. The parent's point stands.

It's not "alarmist nonsense", it's just an example of something illegal. And it's not "cryptocurrency" being compared to illegal things, but unregistered security cryptocurrencies. Bitcoin, the biggest name in cryptocurrency, is fine.

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#166

Post by bb88 »

scott_w wrote: post #160
remarkEon wrote: post #146

Earlier quoted context omitted.

Heroin is illegal, though? Still don't understand how the analogy applies to cryptocurrency. >The company could decide the FDA was wrong... But why would they decide this? Since Heroin is, again, illegal.

Then replace “heroin” with “mouldy, maggot-ridden meat” and you get the point.

Brilliant!

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#167

Post by refulgentis »

loveparade wrote: post #157
_fizz_buzz_ wrote: post #145

Earlier quoted context omitted.

The bias is obvious, but is there anything factually wrong in the article?

It's not about what's wrong, it's about the selection bias of what's included in such an article. You can write a technically "factually correct" article by only including statements that heavily favor one side of the argument, which is what's done here. Also, "facts" in topics that touch politics and law are complicated. This is not like science where measurement can be unambiguous. Most facts in topics such as thes…

That's called "expressing an opinion." What world would we live in if the very fact we wanted to talk about something meant we couldn't?

You're welcome to write a rebuttal but you're attacking the messenger repeatedly instead.

She wrote a cogent concise article that describes what's going on in the real world. Now, we await your brilliance, as soon as you're done repeatedly telling us it's "her career."

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#168

Post by xwolfi »

BLKNSLVR wrote: post #106
jcranmer wrote: post #66

Earlier quoted context omitted.

Then you stopped reading right before you got to the part of the article that really highlights the central lie of Coinbase: > Coinbase, as with most crypto platforms, has decided it wants to simultaneously operate as an exchange, broker-dealer, and clearing agency. These three functions — bringing together securities orders for buyers and sellers, trading securities on behalf of others, and intermediating trades — a…

> are typically required to be separate due to conflicts of interest that emerge when one entity controls all of them. This doesn't appear to be what the SEC is suing Coinbase for though, and is actually far more applicable to the question "then why were they allowed to go public?" It's possible (likely even) there are nuances I don't grok, but sued for selling unregistred securities is not the same as requiring stru…

It is a criminal offense to represent that because the SEC acknowledged the IPO it also approved of the business: it is even written in the Coinbase's IPO prospectus, as Molly points out...

Re: “But the SEC let us go public” and other flawed arguments in Coinbase's defense

#169

Post by Nursie »

lokar wrote: post #131
nickff wrote: post #41

Earlier quoted context omitted.

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.

I think that is mostly about offering a new security, not acting as a broker.

Sure, but presumably registered brokers can only deal in registered securities?
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