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Coinbase issued Wells notice by SEC

reuters.com

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Re: Coinbase issued Wells notice by SEC

#271

Post by SilverBirch »

detrites wrote: post #207
lottin wrote: post #166

Earlier quoted context omitted.

Not so much protecting you, but ensuring a fair playing ground. If crypto is "finance", then it has to be subject to financial regulations.

The definition of what "finance" is seems somewhat arbitrary doesn't it? Person A: spends $1k per year on lottery tickets and doesn't win anything. Person B: puts $1k into BTC at the years high and sells at the bottom getting back $200. Both people had the goal of making a double percentage return. One had an arguably significantly higher chance of doing that. One person was able to buy their lottery tickets at the c…

If you're going to attack the regulations, at least address what the regulations are there for. The regulations are very very simple, it provides a baseline to ensure that people understand what they're investing in. That's it! That's what the regulation is there for. When someone buys clothes or a lottery ticket they know exactly what they're getting - and lotteries are regulated to ensure they operate the way people expect them to, there's laws surrounding selling counterfeit clothes.

That's all this is. Ensuring people know what they're buying. And it's for good reason, generally it's difficult to even get experts in crypto to agree on the properties of a particular product, so misunderstanding what crypto does it a very valid concern.

Re: Coinbase issued Wells notice by SEC

#272

Post by snapcaster »

ETH_start wrote: post #180
lelanthran wrote: post #154

Earlier quoted context omitted.

> I can take my money and put it into a slot machine, gamble it on horses, gamble it on sports games. I can buy useless thousand dollar sneakers, I can buy pokemon cards. I can waste my money on absurdly overpriced art, give it to scammy non-profits, donate it to scammy spoiler political candidates. > In some states I can use my money to hire hookers, or buy drugs. > But if I want to buy crypto, all of a sudden that…

A huge number of crypto projects never advertised their tokens as an investment, and explicitly and repeatedly stated that they are not investments and should not be expected to appreciate, yet the SEC still charged them with promoting an unregistered security.

Please read about the Howey test. Saying "its not a security" obviously doesn't matter anymore than if i rob someone and say "not a robbery" during the crime

Re: Coinbase issued Wells notice by SEC

#273

Post by bilekas »

SilverBirch wrote: post #268
bilekas wrote: post #255

> Staking is a process in which cryptocurrency holders volunteer to take part in validating transactions on the blockchain. For me the key word here is `volunteer`. I'm no 'crypto bro' by any means, but can someone tell me why this is against SEC rules ? Or if it explicitly even is ?

It's a basic regulated market. Because it's so easy to rip people off with financial products (ponzi schemes etc.) the SEC requires you to register a security if you want to sell it to retail. The registration is quite simple but just ensures they've written in black and white what they're claiming to sell. These regulations exist as a direct result of fraud and shenanigans in the past. All that crypto is saying is "…

Okay that kind of clear it up, seems like a lapse of good practice then on Coinbase's if I'm understanding right.

Re: Coinbase issued Wells notice by SEC

#274

Post by MagicMoonlight »

thepasswordis wrote: post #148

I can take my money and put it into a slot machine, gamble it on horses, gamble it on sports games. I can buy useless thousand dollar sneakers, I can buy pokemon cards. I can waste my money on absurdly overpriced art, give it to scammy non-profits, donate it to scammy spoiler political candidates. In some states I can use my money to hire hookers, or buy drugs. But if I want to buy crypto, all of a sudden that is a p…

The slot machine is regulated so that it has fixed odds and isn’t rigged against specific players

Re: Coinbase issued Wells notice by SEC

#275

Post by MagicMoonlight »

roenxi wrote: post #193
lelanthran wrote: post #154

Earlier quoted context omitted.

> I can take my money and put it into a slot machine, gamble it on horses, gamble it on sports games. I can buy useless thousand dollar sneakers, I can buy pokemon cards. I can waste my money on absurdly overpriced art, give it to scammy non-profits, donate it to scammy spoiler political candidates. > In some states I can use my money to hire hookers, or buy drugs. > But if I want to buy crypto, all of a sudden that…

He probably would. I have access to a bunch of good investment opportunities that US citizens don't have, because they are "protected" from accidentally making money. I have a stack of little pamphlets outlining interesting investment deals in Australia all labelled with "don't show this to anyone in the US, if you are a US person this isn't for you and we ask that you don't read it". This isn't crypto, only standard…

Bernie Madoff also outperformed the major banks. I bet you would have been mocking people for not investing in his schemes

Re: Coinbase issued Wells notice by SEC

#276

Post by MagicMoonlight »

bilekas wrote: post #255

> Staking is a process in which cryptocurrency holders volunteer to take part in validating transactions on the blockchain. For me the key word here is `volunteer`. I'm no 'crypto bro' by any means, but can someone tell me why this is against SEC rules ? Or if it explicitly even is ?

People volunteer for a ponzi scheme too, that doesn’t mean it’s allowed

Re: Coinbase issued Wells notice by SEC

#277

Post by ceejayoz »

thepasswordis wrote: post #269
ceejayoz wrote: post #257

Earlier quoted context omitted.

I get scam emails that say "this is not a scam!", too.

You losing the context here. The point was that slot machines are a scam, but also a billion dollar industry.

Slot machines are typically heavily regulated.

Saying "this is not a security" in a disclaimer does not stop your ICO/token/shitcoin from being a security.

Re: Coinbase issued Wells notice by SEC

#278

Post by humanizersequel »

RC_ITR wrote: post #265
humanizersequel wrote: post #79

Earlier quoted context omitted.

> I could write multiple mortgages and roll them up into an MBS myself too, isn't the bank just doing the technical work there too The bank is quite literally writing multiple loans and selling a security. I fail to see how providing tools for customers to more easily put up their tokens as collateral for the privilege of writing new chunks of data to a blockchain (and reaping the rewards) is at all equivalent to eit…

Wait, temporarily giving someone currency that they eventually give back to you is more or less the definition of a loan, no? And Coinbase is doing the work of abstracting that process into a single instrument (Coinbase earn)? Because that’s securitization.

>temporarily giving someone currency that they eventually give back to you is more or less the definition of a loan... And Coinbase is doing the work of abstracting that process into a single instrument (Coinbase earn)? Because that’s securitization.

This is not a specific enough definition. I don't think my checking account is a security, despite the fact that I am loaning my bank money which they eventually give back.

Re: Coinbase issued Wells notice by SEC

#279

Post by JohnFen »

trompetenaccoun wrote: post #184
1vuio0pswjnm7 wrote: post #129

Earlier quoted context omitted.

In the blog past Coinbase General Counsel asks for "guidance". The guidance for future "crypto entrepreneurs" is going to come from the outcomes of these enforcement actions. CryptoExpert: "We want guidance. We want regulation." SEC: "Your product/service is a security." CryptoExpert: "No it's not!" Damodoran called cryptocurrency "currency made by the paranoid for the paranoid." [paraphrase] Let's be honest, coopera…

Other parts of the government do not agree with that take: https://fortune.com/crypto/2023/03/08/stablecoins-ether-comm... The CFTC has been regulating cryptocurrencies just like the SEC. Which part of the government has been breaking the law? HN legal experts will figure it out with snark.

In this sort of situation, it's usually the courts that make the ruling. In order for that to happen, someone has to get sued. It appears that's where this is headed.

Clarity is coming.

Re: Coinbase issued Wells notice by SEC

#280

Post by JohnFen »

haakon wrote: post #211
1vuio0pswjnm7 wrote: post #129

Earlier quoted context omitted.

In the blog past Coinbase General Counsel asks for "guidance". The guidance for future "crypto entrepreneurs" is going to come from the outcomes of these enforcement actions. CryptoExpert: "We want guidance. We want regulation." SEC: "Your product/service is a security." CryptoExpert: "No it's not!" Damodoran called cryptocurrency "currency made by the paranoid for the paranoid." [paraphrase] Let's be honest, coopera…

> The "cryptocurrency" concept seems to be based on a mistrust of government-issued currency and a mistrust of government more generally. This is the classic notion of cryptocurrency, but the field has grown and changed a lot. People don't mint NFT collections and dabble in metaverse tokens as a middle-finger to the state. The VC-funded cryptocurrencies of the last cycle are obviously centralized and are far removed…

> This is the classic notion of cryptocurrency, but the field has grown and changed a lot

Maybe?

It's pretty hard to tell, though, because 90% of the cryptocurrency advocates I hear are from the "government is evil" crowd.

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