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Founder of crypto lender Celsius Network arrested, charged with fraud

reuters.com

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Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#271

Post by TrapLord_Rhodo »

wpietri wrote: post #70
bottlepalm wrote: post #51

Earlier quoted context omitted.

Bitcoin has proven to be an inflation resistant store of value enabling private and fast transactions to anywhere in the world - seems pretty successful to me despite being constantly derided by hacker news for over 10 years now.

Almost every word of that is untrue in practice. But let's focus on the core part, "successful". Let's compare with M-PESA, a money transfer solution that started around the same time. M-PESA has steadily grown, doing 26 billion transactions last year. [1] Bitcoin was somewhere around 100m transactions for the same period. [2] That's about 0.5% of the volume. And its worse than the raw numbers suggest, in that the M-…

Firstly, Transaction volume and total number of transactions are two different metrics. Bitcoin transactions are generally in the $400k-$800k range. Couple things that makes bitcoin more than what it appears:

The metrics you quoted are on chain. There are no telling how many transactions are rolled up through the lightening network.

With around $20B of various wrapped bitcoins being used in defi, you can easily put that number up to hundreds of millions of transactions 'a-day' because bitcoin is being used as collatoral.

We are in a 'bear market' for crypto and it's market cap is $600B, which is larger than some countries let alone M-PESA.

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#272

Post by worstestes »

latchkey wrote: post #267
bertil wrote: post #256

I haven’t followed crypto very closely, but I noticed a few names. I’ve read the headlines for the last few weeks. It seems like most prominent players are now in legal trouble, enough to force them to cease operations. Who are the most prominent players who are operating?

Brian Armstrong CZ

> CZ

hopefully not for much longer

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#273

Post by tornato7 »

angry_albatross wrote: post #46
elforce002 wrote: post #37

And now "crypto" bros are moving to AI. The never ending story.

AI is not in the same category in my book. Both may be overhyped in some ways, but blockchain technology was fundamentally a bad idea with no legitimate use cases.

For better or worse, Crypto is legitimately the easiest way to create a financial application, derivative, exchange etc... any programmer can create interesting, useful, and novel financial instruments like Squeeth, crvUSD, PoolTogether, etc in short order. Good luck recreating those in TradFi in under a decade, let along making them interact with each other in atomic transactions.

Of course, some people see this as a bad thing because it enables scammers to create all sorts of new and improved ponzi schemes. Others think it's a good thing because it speeds up financial innovation and levels the playing field between big banks and small startups.

Some might argue that crypto is only useful for building apps insofar as it avoids regulation, but you also can't convince me that Wells Fargo is the future of finance. Banks could never create a financial playground that works as well as Ethereum, even using their centralized database.

IMO, so many of the projects that have come out of the crypto space are awesome and promising, but investment in the space grew faster than projects could mature. Unfortunately that leads to users losing $100M when Joe Schmo's cross-chain bridge gets hacked, when it should have never had that much TVL.

Just my 2c.

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#274

Post by null0pointer »

ethanbond wrote: post #190
null0pointer wrote: post #156

Earlier quoted context omitted.

The parent of the comment you’re replying to literally cites a case where they were deemed to be wrong.

It looks a bit more nuanced than that. Torres is the judge in the XRP case. From the article: ——- Torres, who is based in New York, on Thursday said the company's $728.9 million of XRP sales to hedge funds and other sophisticated buyers amounted to unregistered sales of securities. But Torres ruled that Ripple's XRP sales on public cryptocurrency exchanges were not offers of securities under the law, because purchase…

Thanks for the clarification.

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#275

Post by vkou »

RetpolineDrama wrote: post #101
vorpalhex wrote: post #86

Earlier quoted context omitted.

> Suddenly, anyone buying and selling them becomes a criminal. No, people buy and sell securities all the time. You simply need to follow the regulations for handling securities which includes certain types of tax and risk effort. If you keep selling securities while not following the KYC and tax stuff for those securities, you will in fact be breaking the law. Nor did the SEC magically throw down one day and start c…

>If you keep selling securities while not following the KYC FWIW KYC "laws" are unconstitutional garbage. The government should not be able to force private companies to do the work of LEA. And before you inevitably reply about how "it's good because it's stops XYZ" 1) It doesn't "stop" XYZ 2) I don't care, privacy and freedom are more important than catching a few more % down the long tail curve of bad guys.

> FWIW KYC "laws" are unconstitutional garbage.

Imagine, for a moment, that I'm a literalist. Which exact part of the constitution prohibits them?

> The government should not be able to force private companies to do the work of LEA.

Good thing they aren't tasked with the work of an LEA, they simply have an obligation to report what they know.

But even if they were, there's nothing that precludes the government from conscripting people for service to the state (The draft). Or from empowering third-parties with LEA-like powers (Bounty hunters, for example).

Are those also prohibited by the constitution? Which part of it?

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#276

Post by [deleted] »

scottiebarnes wrote: post #210
growse wrote: post #203

Earlier quoted context omitted.

> but courts are not actively informing and guiding American companies on what the rules are. Isn't this what lawyers are for?

Guess that's how the world works then; do something until the government sues you, go to court and set precedent. Seems a bit inefficient. Or maybe its the most efficient path after all.

[deleted]

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#277

Post by neom »

FactualOrion wrote: post #153

People should look into his wife's actions as well, selling merch making fun of victims of her husband etc. Great news to hear though.

Just put her in a room alone with Tiffany Fong for a half hour, all will be right in the world.

https://www.youtube.com/watch?v=6FONC7njr64

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#279

Post by Vespasian »

jnwatson wrote: post #266
gamblor956 wrote: post #161

Earlier quoted context omitted.

The SEC is not focused on making the "institutional investors" whole. That is happening in bankruptcy court, because Celsius declared bankruptcy, and that is how bankruptcies work: the senior creditors get their money back first. If you have problems with that, take it up with the bankruptcy court and U.S. bankruptcy laws that classify customers as junior creditors. In fact, the SEC does not ever get involved in "mak…

The SEC does indeed get involved with recovering money for victims of investment fraud. Source: me. The SEC recovered about a third of the money I unwittingly invested in a Ponzi scheme.

If you are willing to share: How did you end up getting tricked and how can other people avoid the same.

Re: Founder of crypto lender Celsius Network arrested, charged with fraud

#280

Post by themagician »

legitster wrote: post #69

Let's say I run a swap meet for people to buy and sell Pokémon cards. There are lots of scammers out there, but I promise people they are going to get good prices. And I even offer to buy cards off of people at good prices to drum up interest. Tomorrow, the SEC decides that Pokémon cards are securities (far-fetched, but work with me here) Suddenly, anyone buying and selling them becomes a criminal. I tell people via…

The SEC doesn't bring criminal charges. The SEC pursues civil action. The SEC tries to hold people liable for the damages they cause, and the bar here is relatively low—a preponderance of evidence (more likely than not) is all that's needed.

If they suspect something is criminal they will then recommend that the Justice Department seek criminal charges. Different legal case, and this has a much higher bar.

Reporting on the SEC often gets mixed up and convoluted. You read about the SEC "charges" and a not guilty criminal plea, but these are actually two separate legal cases happening simultaneously. This is the way it usually happens, since the SEC is unlikely to "enforce" the law (since they can't) unless they can get the Justice Department to bring charges. It's much easier to pursue civil litigation and hold people responsible if you can get a criminal conviction.

If you are facing a criminal trial for fraud there is likely substantial evidence that doesn't fully come through in the reporting. Criminal charges like this don't actually happen that often, which is why the SEC is said to be toothless. They only really pursue if they think they can get the Justice Department onboard AND they can get a criminal conviction. Yeah, yeah, innocent until proven guilty and all that… but if you are facing allegations from both the SEC and the Justice Department you've probably done something pretty heinous.

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