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Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

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Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#221

Post by HaZeust »

ETH_start wrote: post #190
Forgeties79 wrote: post #176

Earlier quoted context omitted.

> They are seen as a necessary (but temporary) evil to bridge the "legacy" fiat world. There is no world in which they can put that genie back in the bottle, so I really hope they don’t actually believe it’s “temporary.”

The top decentralized exchange, Uniswap, has overtaken the top centralized exhanges in liquidity depth for several major trading pairs: https://uniswap.org/blog/uniswap-v3-dominance So there is a world where centralized exchanges have far less relevance than they do today.

Uniswap is *so* easy to slander to the ground from centralized exchanges if push came to shove. It's the primary tool for exit scams, there's barely any qualifications or criteria to mint a coin, ICOs simply don't matter anymore - all are particularly easy points to hit if you're competitors fall short on handling them. And that's just mentioning the pragmatic on how Uniswap neglects fixing the BAD side of crypto, it doesn't even go over how Uniswap delivers only niche features on the good side of crypto - and doesn't do things like foster easier crypto buying/selling for mass adoption from the average person.

Please, come back to me when Uniswap's market cap isn't 1/3 of Coinbase's.

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#223

Post by choppaface »

bulbosaur123 wrote: post #210

Charged for what? There is no "insider trading" with cryptos, just as there isn't any with Forex, fiat currencies. He can't be charged, because there is no crime. No law prevents you to trade cryptocurrencies or fiat on insider knowledge. Might be unethical, but not illegal.

Inside trading is fraud, no matter the security or property, same as with Opensea NFT case:

https://www.justice.gov/usao-sdny/pr/former-employee-nft-mar...

The main problem with crypto is it forces us all to have to re-learn why fraud is bad, and in the process it allows those in power to arbitrage the fraud-learning itself. Satoshi explicitly remarks that fraud is a critical weakness of crypto. Regulations and laws might suck, but when so many societies have adopted anti-fraud mechanisms, hey maybe that was actually a good idea and not something we need to re-learn?

Even Roughgarden’s textbook proves the vulnerabilities of blockchain-based mechanisms.. .. Maybe crypto advocates citing false straw man arguments should be considered investment advice and punished by the SEC as well.

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#224

Post by dragonwriter »

andrewljohnson wrote: post #214
bulbosaur123 wrote: post #210

Charged for what? There is no "insider trading" with cryptos, just as there isn't any with Forex, fiat currencies. He can't be charged, because there is no crime. No law prevents you to trade cryptocurrencies or fiat on insider knowledge. Might be unethical, but not illegal.

There is actually no particular law against insider trading at all, not even related to equities… it’s all securities and wire fraud. https://www.bloomberg.com/opinion/articles/2022-06-02/don-t-...

> There is actually no particular law against insider trading at all, not even related to equities…

There actually is. See, well, a whole lot of 15 USC Chapter 2B [0], notably provisions like 15 USC Sec. 78p (prohibiting certain trades by corporate insiders, and creating civil liability of those conducting such trades to the issuer of the security thus traded) and 78u-1 (authorizing civil penalties by the SEC for insider trading made illegal by the Securities and Exchange Act.)

What Bloomberg probably meant to say is that there is not a distinct crime of insider trading, but that illegal insider trading is generally also the crime of securities fraud.

[0] https://www.law.cornell.edu/uscode/text/15/chapter-2B

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#225

Post by aakilfernandes »

bulbosaur123 wrote: post #210

Charged for what? There is no "insider trading" with cryptos, just as there isn't any with Forex, fiat currencies. He can't be charged, because there is no crime. No law prevents you to trade cryptocurrencies or fiat on insider knowledge. Might be unethical, but not illegal.

IANAL but I believe the legal theory is they stole proprietary information from Coinbase (information about an upcoming listing) and used it for personal profit. The "victims" in this view are NOT users of the exchange (or the broader cryptocurrency market) but rather shareholders of Coinbase.

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#226

Post by tromp »

ETH_start wrote: post #190
Forgeties79 wrote: post #176

Earlier quoted context omitted.

> They are seen as a necessary (but temporary) evil to bridge the "legacy" fiat world. There is no world in which they can put that genie back in the bottle, so I really hope they don’t actually believe it’s “temporary.”

The top decentralized exchange, Uniswap, has overtaken the top centralized exhanges in liquidity depth for several major trading pairs: https://uniswap.org/blog/uniswap-v3-dominance So there is a world where centralized exchanges have far less relevance than they do today.

Correct me if I'm wrong, but Uniswap doesn't allow people to buy crypto currency with fiat. It only exchanges between various crypto currencies. There will always be a need for fiat-crypto exchanges like Coinbase, that are centralized by necessity.

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#227

Post by walrus01 »

koolba wrote: post #121
zionic wrote: post #76

Earlier quoted context omitted.

Wow, not that I would ever do anything like this… but if I was accused of such a thing the last thing I would do is book a flight for tomorrow .

Much better to drive across the border and then book a flight with a non-US airline.

He could've taken out cash from his local bank account, turned off his phone, driven to San Ysidro and walked through the public turnstile into Tijuana. And then tried to get a flight from Mexico City to somewhere in south asia.

Would have been much better than going through the US/Canada border which has a full data sharing agreement between CBSA and US CBP/ICE.

(note: this is a stupid, humorous theoretical, not real advice on how to flee to avoid prosecution)

also, a note, any airline flight that crosses US airspace submits its passenger manifest to US CBP/ICE/DHS electronically as a database transfer, this has been a thing for 20+ years as a result of 9/11 and the PATRIOT act.

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#228

Post by romellem »

bulbosaur123 wrote: post #211
est31 wrote: post #38

Note that they were charged for wire fraud and wire fraud conspiracy. So not for actual Section 10(b) violations, aka insider trading.

Where is the fraud? They can't charge with insider trading, because insider trading does not apply to currencies or cryptocurrencies.

According to the [indictment][1], they violated [18 USC § 1343][2], when they:

  participated in a scheme to deprive
  Coinbase of its exclusive use of
  confidential business information
  related to Coinbase's plans to list
  certain crypto assets on its exchanges
[1]: https://www.justice.gov/usao-sdny/press-release/file/1521186... [2]: https://www.law.cornell.edu/uscode/text/18/1343

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#229

Post by kerblang »

NelsonMinar wrote: post #222

What is happening here? This link is to stacker.news, a HN-like website. It's for a story that is another active top story already on HN. Are folks just commenting on the headline without even clicking the link?

Should I give a link to the other one even though it's currently listed right under this story? Heck why not... occasionally the crypto discussions are intelligent...

https://news.ycombinator.com/item?id=32180428

Re: Former Coinbase PM charged in cryptocurrency insider trading tipping scheme

#230

Post by [deleted] »

SilasX wrote: post #213
romellem wrote: post #16

Wow, the indictment references [this tweet][1] that caused Coinbase to investigate the matter and ultimately led the defendant in being caught at the airport before trying to leave the country. > On May 11, 2022, Coinbase’s director of security operations emailed ISHAN WAHI to inform him that he should appear for an in-person meeting relating to Coinbase’s asset listing process at Coinbase’s Seattle, Washington offic…

Haha, and the first reply to that tweet is complaining that the SEC is ignoring this while shackling another Coinbase venture. That didn't age well! https://twitter.com/ChainLinkGod/status/1513926481486909442 Edit: Quoting in case it gets deleted: >>While the SEC was very swift in shutting down Coinbase Lend for DARING to provide 4% yield >>They’ll do absolutely nothing about this situation because they are a corrupt…

[deleted]
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