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Coinbase CEO: we're preparing to go to court with the U.S. SEC

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Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#101

Post by TimJRobinson »

overthrow wrote: post #84
treypitt wrote: post #45

Coinbase and Armstrong tried for months to get the SEC to tell them if their Earn/Staking product constituted a security, and they declined to answer. Serving a Welles Notice makes it clear Gensler is a bad faith regulator https://podcasts.google.com/feed/aHR0cHM6Ly91bmNoYWluZWQubGl...

Gensler has publicly said “everything other than Bitcoin” is a security. https://cryptoslate.com/sec-chair-gensler-confirms-everythin... Is that not a clear enough answer? I'm not saying Coinbase has to agree - but there's no way they didn't know he said this.

I replied to your other comment, but posting here that this article is wrong and twists his words. He said Bitcoin is not a security, everything else is undecided. Big difference. Coinbase it taking them to court to make them decide.

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#102

Post by linuxftw »

vkou wrote: post #89
chomp wrote: post #33

There's a few people picking sides here in the comments. Just reminding everybody that it's possible for two sides to be at issue; the SEC can be trying its best to apply its mandate in a world where technology has surpassed the law, and in a void of congressional action, and as a result giving very vague guidance so that it can squeeze its mandate into the crypto realm. And Coinbase can be purposely threading the ne…

Why would the SEC need congressional action to regulate securities (which is what some of the crypto tokens traded on exchanges are)? Why would Coinbase think that it could run a securities brokerage, exchange, and clearing house without registering with the SEC? Just because you've added '... But on the internet' to your business model does not require additional legislature to determine whether or not you are tradi…

You're getting downvoted, but you're 100% correct.

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#103

Post by latchkey »

jcranmer wrote: post #31
VWWHFSfQ wrote: post #2

Sounds like the free lunch is over. Maybe my view is too simplistic, but Coinbase facilitates the sale of "assets" that the buyer expects to increase in value. By definition, that's a security, right?

The Howey test requires that a security be (1) an investment of money (2) in a common enterprise (3) with the expectation of profit (4) to be derived from the efforts of others. Cryptocurrencies very clearly meet (1) and (2). Many tokens are likely to meet (3), but it's not universal. But (4) is where you have the most room to argue. I don't know what Coinbase offers for sale. But I'm certain that least some of the t…

> I don't know what Coinbase offers for sale.

https://www.coinbase.com/price/poocoin

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#104

Post by jedberg »

VWWHFSfQ wrote: post #74
true_religion wrote: post #48

Earlier quoted context omitted.

They ought to. Giving advice is the difference between having the government work with the people, on the same side, and having it be an adversary. The goal should be legal compliance and productive companies. Not clarifying what you will or will not prosecute simply creates unnecessary fear and distrust of the system. Think of all the crime that would not be committed if only the SEC said it was criminal before hand…

SEC doesn't give legal advice because they don't make the laws. Want legal advice? Talk to a lawyer. But if your council tells you it's OK to push some boundaries then don't be surprised if you get slapped. And if you don't like getting slapped then you can go to court. Which is exactly what is happening. Seems like the system is working as intended.

The SEC enforces the law, and it should be totally normal for them to say "this is how we plan to enforce this law". By not saying so, they create a lot of unnecessary churn.

Imagine you are outside a store, and there is a police officer outside. You ask them "If I go inside and take some bread off the shelf and walk out without paying, is that ok?". Should the officer say "talk to a lawyer" or should they say "I would arrest you on the way out"?

They aren't offering legal advice, they are just telling you how they will enforce the law. And heck, maybe you'll go to court and get it overturned. But at least you know what enforcement actions will be taken.

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#106

Post by latchkey »

sosuke wrote: post #20
ericpauley wrote: post #5

Earlier quoted context omitted.

Yes and no. Gold isn’t a security, for instance. Unfortunately (for coinbase) ICOs and related grifts pretty clearly meet both the spirit and the letter of the SEC’s definition.

Is the relationship pretty much ICOs or tokens are a security and older options are like gold? ie: BTC, LTC, Monero are gold but an ERC20 token is a security and Cardano is a security because it was an ICO? I don't know off hand if Ethereum was an ICO. I keep thinking this but I can't remember seeing anyone suggest that each coin could be categorized differently. Is it possible we ended up splitting the crypto curren…

> but an ERC20 token is a security

What is WETH then?

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#107

Post by nostrademons »

mason55 wrote: post #69
rekttrader wrote: post #32

Earlier quoted context omitted.

The sec is not a supervisory agency, they’re a regulator meaning they step in after the fact for investor protections. The sec had plenty of open sessions where folks in the industry would ask for guidance and yet it was not gotten because they don’t tell the capital or crypto markets what should be in the markets they’re here to pull down the things that shouldn’t be. The sec allows “junk bonds” if you disclose the…

> Heck, you can buy VIX for CDS... let’s think about that for a second... that’s a mortgage, packed into a portfolio Are you thinking MBS maybe? CDS is credit default swap, has nothing to do with mortgages

The way he described it, he's talking about CDS. "a mortgage, packed into a portfolio (MBS), that has a derivative (CDS), and that derivative’s volatility (VIX for CDS) is tradeable."

CDS is (usually) a derivative on MBS - it's a promise to pay out if a given MBS security defaults.

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#108

Post by latchkey »

linuxftw wrote: post #102
vkou wrote: post #89

Earlier quoted context omitted.

Why would the SEC need congressional action to regulate securities (which is what some of the crypto tokens traded on exchanges are)? Why would Coinbase think that it could run a securities brokerage, exchange, and clearing house without registering with the SEC? Just because you've added '... But on the internet' to your business model does not require additional legislature to determine whether or not you are tradi…

You're getting downvoted, but you're 100% correct.

> Why would Coinbase think that it could run a securities brokerage, exchange, and clearing house without registering with the SEC?

Coinbase is a public company on NASDAQ. They are about as registered with the SEC, as possible.

Update: cause I'm getting downvotes. See below. The point that I'm making is that if this company is acting illegally, then why is it still trading?

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#109

Post by linuxftw »

true_religion wrote: post #48
elliekelly wrote: post #34

Earlier quoted context omitted.

The SEC doesn’t give out legal advice.

They ought to. Giving advice is the difference between having the government work with the people, on the same side, and having it be an adversary. The goal should be legal compliance and productive companies. Not clarifying what you will or will not prosecute simply creates unnecessary fear and distrust of the system. Think of all the crime that would not be committed if only the SEC said it was criminal before hand…

The problem is always something like this: "I'm telling the SEC that I'm doing A, B, C. SEC says it's legal. Later, SEC finds out I'm really doing A, B, C, D, which is illegal"

The SEC isn't dumb enough to be trapped into an opinion that can be twisted around.

Re: Coinbase CEO: we're preparing to go to court with the U.S. SEC

#110

Post by [deleted] »

exabrial wrote: post #56

Can I pay for a Starbucks Double Frap Latte with Apple stock? Probably not, Apple stock is a security, not a currency... I'm sure someone has tried. But can I use Apple Stock as an investment vehicle? Yes. Conversely, can I pay for said surgary drink in DodgeCoin? Well no, you can't, but not for the same reasons. Starbucks doesn't have the facilities to accept DodgeCoin. Can you use it as an investment vehicle? Yes.…

[deleted]
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