Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

bloomberg.com

Post reply on HN
Print view View original

281–290 of 489 posts

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#281

Post by refurb »

dragonwriter wrote: post #266
PheonixPharts wrote: post #202

Earlier quoted context omitted.

> but didn't secure themselves against a defector Still a surprisingly amateur move. Once worked for the Federal Government where literally everything you write is potentially subject to a FOIA request. The message all new hires were told was, very clearly: "Never put anything into writing you wouldn't be happy to be see published on the front page of the Washington Post" Anything that was even vaguely close to faili…

> The message all new hires were told was, very clearly: "Never put anything into writing you wouldn't be happy to be see published on the front page of the Washington Post" > And this was for an org that was doing nothing sneaky or underhanded in the slightest I disagree. That culture is one of routinely doing sneaky and underhanded things. If it wasn’t, the rule would be “don’t do anything you wouldn't be happy to…

Disagree.

Plenty of examples of companies that did nothing wrong, but some written comment, by some employee is enough to convince a jury that "something probably happened".

I remember one pharmaceutical company was on trial for a drug that was suspected to have a bad side effect (later analysis show it didn't). They had done nothing wrong, all data was provided to the FDA, they diligently collected post-marking data, shared with the FDA, etc.

A civil suit was brought and during discovery they found a comment that said "maybe our dose was too high?". The person who made the comment had nothing to do with the trials, didn't have the skills to interpret the data, didn't even have a medical background.

Once that was found? Boom, the company settled because that was enough to convince a jury that "they probably knew it was wrong".

It's very easy to put something in writing now that has no impact, but in a few years time is a smoking gun. It doesn't matter if you testify that around the circumstances when you wrote it ("oh, I didn't mean that"), the jury won't believe you, the prosecution will just flash that one sentence up and say "see, it obvious the company was hiding the problem".

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#282

Post by idopmstuff »

dragonwriter wrote: post #266
PheonixPharts wrote: post #202

Earlier quoted context omitted.

> but didn't secure themselves against a defector Still a surprisingly amateur move. Once worked for the Federal Government where literally everything you write is potentially subject to a FOIA request. The message all new hires were told was, very clearly: "Never put anything into writing you wouldn't be happy to be see published on the front page of the Washington Post" Anything that was even vaguely close to faili…

> The message all new hires were told was, very clearly: "Never put anything into writing you wouldn't be happy to be see published on the front page of the Washington Post" > And this was for an org that was doing nothing sneaky or underhanded in the slightest I disagree. That culture is one of routinely doing sneaky and underhanded things. If it wasn’t, the rule would be “don’t do anything you wouldn't be happy to…

There are plenty of cases where you wouldn't want something perfectly reasonable to be published in the Post. The key is context - some things are complicated and require background and relevant information; if taken without that context, they'll seem bad.

Seeing as we live in a world in which people in the other political party are highly motivated to take whatever they can of their opponents (and their opponents' appointees, etc.) and make them sound bad, it's understandable that folks would be cautious of what they write down. If someone emails you a question whose answer is potentially politically sensitive, you might not want to provide a brief answer to that email that you know could be misconstrued. That isn't "evidence of consciousness of wrongdoing" - it's just understanding the reality of politics.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#283

Post by preseinger »

johndhi wrote: post #69
gadnuk wrote: post #40

> In one instance, the Binance chief compliance officer messaged a colleague that, “[w]e are operating as a fking unlicensed securities exchange in the USA bro.” Source: https://twitter.com/JohnReedStark/status/1665748594421297152 This is a legendary quote from the filing.

what's stupid is that quotes like this, not actual substance of what their business practices are, are the only way the SEC can establish what is and isn't a "security." there is no real truth or objective test and the SEC has offered no meaningful guidance. so they just determine this based on subjective emails the CEO sent once.

it's pretty clear that almost every cryptocurrency/coin classifies as a security

anyone arguing otherwise almost certainly has a dog in the hunt

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#284

Post by dingledork69 »

JumpCrisscross wrote: post #233
notahacker wrote: post #228

Earlier quoted context omitted.

Not writing down anything youd be upset another person read is a pretty standard instruction for people doing interactions with ordinary business clients anywhere that data protection legislation theoretically allows them to make a statutory request the company send records you hold about them (Probably other jurisdictions too, if their lawsuits have a discovery process) And that's "dear junior sales team members, pl…

> that's "dear junior sales team members, please don't put your opinion of the client in writing, in the unlikely event they ask for a data dump they might be a bit miffed" One of my first moves running a trading team is reducing or eliminating internal chat. I don’t think I’ve gone a week without at least one client receiving an inappropriate nickname. It’s harmless. But it’s not something you want showing up in dis…

[flagged]

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#285

Post by ARandumGuy »

everfree wrote: post #275
ARandumGuy wrote: post #201

Earlier quoted context omitted.

Just because the current system sucks doesn't mean a replacement will be better. Its the responsibility of people advocating for a replacement system to explain and demonstrate why it will be better. Banks suck. But that doesn't mean crypto companies should have free reign to do whatever they want for the sake of "innovation."

> that doesn't mean crypto companies should have free reign to do whatever they want for the sake of "innovation." As a company, you're allowed to do anything that is not illegal. Law is not a whitelist of what you're allowed to do, it's a blacklist of what you're not allowed to do. And while it makes sense to create laws that protect consumers, it doesn't make sense to create laws that blanket ban experimentation wi…

> If Steve Jobs had to "explain and demonstrate" why the iPhone would be better than flip phones and blackberries to the satisfaction of Congress before being allowed to experiment with its design, Apple probably would have just moved their HQ to China, and Americans would be the ones missing out.

Apple had to comply with a ton of regulations and laws when making the iPhone. Off the top of my head, they had to comply with various product safety laws, FCC frequency allocations, and consumer protection rules.

The US (and most other countries) have a lot of regulations for managing money and investments. These apply regardless of the underlying technology being used. Legally, the only thing cryptocurrencies brought is that they didn't obviously fit into any existing legal framework. This was mostly due to a lack of judicial precedence, not because cryptocurrencies were fundamentally different.

This isn't writing laws to stifle innovation. This is using laws that already exist to actually regulate companies that have managed to avoid it before now.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#286

Post by WeylandYutani »

PheonixPharts wrote: post #202
setgree wrote: post #148

Earlier quoted context omitted.

My theory is that Binance execs were having these chats in an encrypted medium (e.g. WA or Signal) but didn't secure themselves against a defector. I think someone on the inside took screenshots and went to the feds (or started cooperating under legal pressure). There's even a leading candidate [0]. What's funny about this is it's a fine metaphor for what ails crypto as a whole. The technology is cryptographically se…

> but didn't secure themselves against a defector Still a surprisingly amateur move. Once worked for the Federal Government where literally everything you write is potentially subject to a FOIA request. The message all new hires were told was, very clearly: "Never put anything into writing you wouldn't be happy to be see published on the front page of the Washington Post" Anything that was even vaguely close to faili…

In person conversation doesn't work because Zhao doesn't want to enter the US.

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#287

Post by preseinger »

codetrotter wrote: post #116
itake wrote: post #102

Earlier quoted context omitted.

who is buying crypto and not expecting to make a profit from it?

> who is buying crypto and not expecting to make a profit from it? Me. I put my savings in Bitcoin because I dislike the tradfi system. All I want is to be in control of my savings and to be able to freely transact with anyone anywhere in the world. I am still affected by the exchange rates to USD and EUR. But the hope is that in the future I will be able to use BTC directly more often and not even have to touch USD…

there is no universe in which a (edit: financially sound) nation will accept tax payments in a denomination over which it has no influence or control

(edit: nations that peg their currency to the euro or the dollar are clearly exceptions to what i'm describing here)

this is literally money 101 type stuff, wars have been fought over this stuff, and it's insane that crypto folks don't seem to understand any of it

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#288

Post by bornfreddy »

csunbird wrote: post #277
Animats wrote: post #268

Read the court filing. There's a lot of inside information from "BAM CEO A" and "BAM CEO B". These were the first two CEOs of Binance.us. They came on board thinking they had a real job. Then they discovered they were just figureheads. "BAM CEO A" was fired. "BAM CEO B" quit after three months and started cooperating with US regulators. "Upon assuming his CEO duties, however, BAM CEO B quickly learned that Binance, i…

Very interesting… I guess the CEO’s were hired to be thrown under the bus when it is the time. Their job was to PLEASE: Provide legal exculpation and sign everything. (hey HIMYM fans!)

> I guess the CEO’s were hired to be thrown under the bus when it is the time.

It's ironic that they are now the ones feeding SEC with inside information. It seems like the plan backfired?

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#289

Post by [deleted] »

preseinger wrote: post #287
codetrotter wrote: post #116

Earlier quoted context omitted.

> who is buying crypto and not expecting to make a profit from it? Me. I put my savings in Bitcoin because I dislike the tradfi system. All I want is to be in control of my savings and to be able to freely transact with anyone anywhere in the world. I am still affected by the exchange rates to USD and EUR. But the hope is that in the future I will be able to use BTC directly more often and not even have to touch USD…

there is no universe in which a (edit: financially sound) nation will accept tax payments in a denomination over which it has no influence or control (edit: nations that peg their currency to the euro or the dollar are clearly exceptions to what i'm describing here) this is literally money 101 type stuff, wars have been fought over this stuff, and it's insane that crypto folks don't seem to understand any of it

[deleted]

Re: SEC Sues Binance and CEO Zhao for Breaking US Securities Rules

#290

Post by rafaelero »

preseinger wrote: post #287
codetrotter wrote: post #116

Earlier quoted context omitted.

> who is buying crypto and not expecting to make a profit from it? Me. I put my savings in Bitcoin because I dislike the tradfi system. All I want is to be in control of my savings and to be able to freely transact with anyone anywhere in the world. I am still affected by the exchange rates to USD and EUR. But the hope is that in the future I will be able to use BTC directly more often and not even have to touch USD…

there is no universe in which a (edit: financially sound) nation will accept tax payments in a denomination over which it has no influence or control (edit: nations that peg their currency to the euro or the dollar are clearly exceptions to what i'm describing here) this is literally money 101 type stuff, wars have been fought over this stuff, and it's insane that crypto folks don't seem to understand any of it

That's why Bitcoin is so powerful: they can't do anything about it and, if people choose to use it, the government has no choice other than accept it as the standard.
Post reply on HN