Statement on Potentially Unlawful Online Platforms for Trading Digital Assets • Hacker News Board

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#111

Post by crypt1d » Wed, Mar 07, 2018, 6:59 PM UTC

yzmtf2008 wrote: post #102

crypt1d wrote: post #73

Earlier quoted context omitted.

Are you implying that because someone lives in an oppressive country that they have no money to transact? I really dont understand your question. Oppressive regimes tend to control money flow in/out of the country. So if you, for example, have an aunt somewhere outside that wants to send you money -> you just might not be able to receive it, or would need to give some official a slice of the pie. Bitcoin obviously ca…

Crypto is only effective in that regard if you're able to opt-in. The problem is, you eventually need to interface with the fiat currencies for your "wealth" to be useful. The first step an oppressive regime would do is to just ban exchanges. Acquiring this "wealth" of crypto would be impossible in an oppressive regime in the first place.

you dont really need to go to an exchange to get crypto. Lots of OTC sellers, miners, etc.

There were actually a few news articles about people in 3rd world countries that survived thanks to btc, though I can't find any at the moment.

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#112

Post by lurchpop » Wed, Mar 07, 2018, 7:00 PM UTC

whb07 wrote: post #20

From my untrained perspective it seems like they are warning against "the appearance of a regulated market". Therefore, all these markets should do is have a big banner at the top stating: "We are not regulated by the SEC and any activity here is not protected by any rules and regulations which might apply to a SEC registered company. Please be careful" Or am i crazy?

I think that protective tone they're taking is PR. These potential enforcement actions are for your safety because we care about protecting investors.

Not that it's a power grab in the crytpo market.

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#113

Post by cal5k » Wed, Mar 07, 2018, 7:04 PM UTC

toomim wrote: post #110

cal5k wrote: post #98

Earlier quoted context omitted.

"The Commission has determined not to pursue an enforcement action in this matter based on the conduct and activities known to the Commission at this time" I mean... it sounds to me like they did their due diligence. The PDF contains an in-depth look at how existing securities law intersects with what this group was doing. That's exactly what the SEC is supposed to do. DAOs are new and unfamiliar. They looked at what…

No no, what happened is the DAO imploded on its own a whole year before the SEC even looked at it. The DAO was hacked in June of 2016 , and the SEC didn't release that article until July of 2017 . https://en.wikipedia.org/wiki/The_DAO_(organization) When the SEC says: > The Commission has determined not to pursue an enforcement action in this matter based on the conduct and activities known to the Commission at this…

I don't see why that matters. They clarified that DAO tokens are securities but decided not to pursue any action for a number of reasons, one of which being (and they've stated this elsewhere) that prior to their clarification there was ambiguity on this issue.

The tl;dr is that they are clearly securities under existing law. Now that the SEC has clarified that fact companies are free to issue Tokens if they comply with the law.

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#114

Post by crypt1d » Wed, Mar 07, 2018, 7:05 PM UTC

scblock wrote: post #108

crypt1d wrote: post #52

Earlier quoted context omitted.

by allowing u to transact wealth without the control and oversight of the oppressive regime.

Is this the same oppressive regime that surveils, firewalls and filters the internet and other forms of communication that this idea depends on?

I see you are trying to be clever, but that comment doesn't really bring anything to the table. Sure, you can try to filter/block crypto transactions but that will be A LOT harder than blocking dissident blogs. One of the biggest selling points of many decentralized systems is to be censorship resistant.

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#115

Post by gwbas1c » Wed, Mar 07, 2018, 7:05 PM UTC

TallGuyShort wrote: post #8

So if some anonymous person invents cryptocurrencies, at what point are you supposed to be considered securities? If the first exchange had gone to SEC to register as a securities exchange, would the SEC not have laughed in their face? The headline itself really captures the ambiguity and uncertainty of all of this: "potentially unlawful".

The reason why many cryptocurrencies are considered securities is because there's a certain group of people promoting them as in investment. They are claiming that their cryptocurrencies will rise in value.

If you study the definition of money, and what makes a good currency, there's no kind of money that rises in value merely because you own it. Money is meant to be spent or invested, not hoarded. (Adam Smith's "Wealth of Nations" gives a much better explanation in the first few chapters than I can.)

So, the point that you have to register as a security is the point that you start convincing people to own your cryptocurrency as in investment. At that point, your cryptocurrency isn't money; because money is meant to be spent.

How do you keep the SEC out of your cryptocurrency? Invent a cryptocurrency that functions as money. You will need to figure out how to keep the value stable on a day-to-day and year-to-year basis. That means that the supply needs to expand and contract quickly based on demand. "Mining" based cryptocurrencies can not do this.

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#116

Post by JumpCrisscross » Wed, Mar 07, 2018, 7:06 PM UTC

toomim wrote: post #110

cal5k wrote: post #98

Earlier quoted context omitted.

"The Commission has determined not to pursue an enforcement action in this matter based on the conduct and activities known to the Commission at this time" I mean... it sounds to me like they did their due diligence. The PDF contains an in-depth look at how existing securities law intersects with what this group was doing. That's exactly what the SEC is supposed to do. DAOs are new and unfamiliar. They looked at what…

No no, what happened is the DAO imploded on its own a whole year before the SEC even looked at it. The DAO was hacked in June of 2016 , and the SEC didn't release that article until July of 2017 . https://en.wikipedia.org/wiki/The_DAO_(organization) When the SEC says: > The Commission has determined not to pursue an enforcement action in this matter based on the conduct and activities known to the Commission at this…

> When the SEC says...what they mean is: we chose not to beat a dead horse, because it's already dead

The SEC charged Bernie Madoff's auditors after the scheme had been revealed [1]. In respect of the DAO, the SEC appears to be taking a "wait and see" approach. (With ICOs, on the other hand, we've seen enough.)

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#117

Post by piracykills » Wed, Mar 07, 2018, 7:08 PM UTC

lagadu wrote: post #81

cal5k wrote: post #67

Earlier quoted context omitted.

Yup. It's really quite simple - focus on the USD on-ramps and off-ramps.

It's effectively the only way to do it but the way around it is fairly simple: use a bank account on another country, one that is OK with crypto along with non-US based exchanges.

Of course it won't stop trade completely, but it could tank the price and cause interest to drop off as that's significantly higher effort than "sign up here, use your credit card or bank account directly".

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#118

Post by [deleted] » Wed, Mar 07, 2018, 7:08 PM UTC

gwbas1c wrote: post #115

TallGuyShort wrote: post #8

So if some anonymous person invents cryptocurrencies, at what point are you supposed to be considered securities? If the first exchange had gone to SEC to register as a securities exchange, would the SEC not have laughed in their face? The headline itself really captures the ambiguity and uncertainty of all of this: "potentially unlawful".

The reason why many cryptocurrencies are considered securities is because there's a certain group of people promoting them as in investment. They are claiming that their cryptocurrencies will rise in value. If you study the definition of money, and what makes a good currency, there's no kind of money that rises in value merely because you own it. Money is meant to be spent or invested, not hoarded. (Adam Smith's "Wea…

[deleted]

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#119

Post by dragonwriter » Wed, Mar 07, 2018, 7:11 PM UTC

CryptoPunk wrote: post #93

wincy wrote: post #41

Earlier quoted context omitted.

The burden of proof is on the new product, not the current society. I don't think he needs "data and deep analysis", that work needs to be done by the people trying to convince you cryptocurrencies are the future. When the status quo is disrupted, it's perfectly reasonable to assume that it's a passing fad or won't work out. A product or asset, especially a radical step like cryptocurrencies, succeeding and being val…

Society shouldn't ban everything that hasn't proven to be socially beneficial.

Exchanges of the types prohibited by existing securities laws are not prohibited merely because they haven't proven to be socially beneficial, but because they have proven to be massively harmful.

The idea that cryptocurrency as a subject of trading changes that in any way is a claim which requires some substantial basis before it would warrant an exception to the general rules written into law.

Re: Statement on Potentially Unlawful Online Platforms for Trading Digital Assets

#120

Post by AlexCoventry » Wed, Mar 07, 2018, 7:12 PM UTC

apo wrote: post #21

There doesn't appear to be any new information here, and this quote sums it up pretty well: The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not. The SEC has already made its view clear that many ICOs fall under SEC regulatory jurisdiction. For example: https://www.sec.gov/news/testimony/testimony-virtual-currenc...

You could argue that there was no new information in the DAO guidance, too, but it did sharpen the public perception of the SEC's position. I think this warning is doing the same.

Also, ICOs and exchanges are different beasts, both subject to SEC jurisdiction. This is about regulation of and enforcement against exchanges, not ICOs.