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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

#331

Post by tim333 »

realusername wrote: post #324
TheAlchemist wrote: post #21

Earlier quoted context omitted.

All those guys are going to end up in prison. It’s fraud after fraud - biggest one being Tether. It’s just impressive how long it all takes.

I'm also surprised Tether hasn't imploded yet, it's opacity must have saved it in the short term

There's nothing that inherently unsustainable in Tether's basic model. Take in US$, issue tokens matching them and keep the interest on the US$.

Their main problem is money laundering regs which is why they have to be opaque and offshore.

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

#332

Post by DANmode »

jnwatson wrote: post #287
Vespasian wrote: post #279

Earlier quoted context omitted.

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

It was a pretty good scam. The scammer had a company that sold fractional profit shares in oil wells. Without getting too deep in the weeds, he sold the equivalent of more than 100%. He invested the proceeds of new investment in paying out old investors and buying new oil wells. Eventually he ran out of new investor money and the scheme unraveled. I don’t know how I would have caught it. The regulatory oversight in o…

> He then escaped

Is this...common?

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

#334

Post by TheAlchemist »

tim333 wrote: post #331
realusername wrote: post #324

Earlier quoted context omitted.

I'm also surprised Tether hasn't imploded yet, it's opacity must have saved it in the short term

There's nothing that inherently unsustainable in Tether's basic model. Take in US$, issue tokens matching them and keep the interest on the US$. Their main problem is money laundering regs which is why they have to be opaque and offshore.

Plot twist: They don't take in US$ ! At least not legal US$, and not anywhere near the amount they claim they have.

It has been proven beyond reasonable doubt already multiple times that they are lying about the supposed composition of their 'assets'.

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

#335

Post by jowea »

toomuchtodo wrote: post #4

"Somebody is lying. Either the bank is lying or Celsius is lying.” - Alex Mashinsky EDIT: omg at the almost $5B settlement https://www.cnbc.com/2023/07/13/former-celsius-ceo-arrested-... ("The FTC also announced a $4.7 billion settlement against the exchange, which will not be paid until creditors and investors have been repaid in bankruptcy proceedings.")

I'm not up on all the details of the situation, but "after creditors and investors" means $0, right? Why is a fine getting less priority than investors? Isn't that a moral hazard?

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

#336

Post by Closi »

esperent wrote: post #329
tornato7 wrote: post #235

Earlier quoted context omitted.

FTX, 3AC, Celsius, etc. took the crypto pill and believed their investments were going to the moon with no way to stop it. That's why they took such risky bets (with customer money, too) - because in the certain case that Bitcoin hit $1M they would be trillionaires. Of course because of this attitude there was way too much leverage in the system, which drove up prices to ATHs temporarily, but when the money supply ra…

> in the certain case that Bitcoin hit $1M they would be trillionaires. I never could understand this. Crypto currently makes up about 7% of the world's money supply, according to a quick search. Bitcoin is currently ~30k USD. If you bumped that to 1 million USD, a 33x increase in value, and assume that other crypto would go up roughly the same amount... ... You get the impossible answer that crypto would be worth we…

> Crypto currently makes up about 7% of the world's money supply, according to a quick search.

That quick search is clearly way off, It's closer to 0.1% - 1% depending on how you calculate it.

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

#337

Post by DennisP »

Nursie wrote: post #312
DennisP wrote: post #102

Earlier quoted context omitted.

The writing would definitely be on the wall if the SEC got to make the final decision. But they don't, and they just had a big loss in court with the XRP case. If XRP isn't a security, then most other things traded on exchanges aren't securities either. https://www.reuters.com/legal/us-judge-says-sec-lawsuit-vs-r...

I don’t think it’s clear from that case that XRP is not a security - “The SEC won a partial victory as Torres found the company's $728.9 million of XRP sales to hedge funds and other sophisticated buyers amounted to unregistered sales of securities.” It seems more that selling it on exchanges was not a violation of the law, but some of the activities around it still were. (Edit - in fact it may not even be that, acco…

Conclusion of section 2: "the Court concludes that Ripple’s Programmatic Sales of XRP did not constitute the offer and sale of investment contracts."

If it's not an investment contract, it's not a security. That's one of the major points of the whole decision. Section 1 details ways that sales to institutional buyers did involve a contract.

The footnote just says the decision does not directly address exchanges. But it's hard to see how the arguments in section 2 wouldn't apply to exchanges just as well.

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

#338

Post by Forgeties79 »

latchkey wrote: post #304
Forgeties79 wrote: post #212

Earlier quoted context omitted.

> Banks are a pain in the ass to deal with. Bitcoin is a very practical and easy way to move large amounts of money around. There is no way you will convince me that setting up and using Bitcoin for daily transactions, all on your own wallet with your keys etc., is “easy” or any less of a “pain in the ass” than using a regular modern bank is on a daily basis. That’s even ignoring the baseline tech literacy one needs…

As a US citizen who has lived for multiple years in Vietnam, I can guarantee to you that using Bitcoin is infinitely easier than dealing with the VN banking system. Forget the legal/identity aspects, just the language and cultural barriers alone are a huge pain in the arse.

I find it hard to believe you are doing even half your daily transactions without converting to fiat. I also don’t know how you can wait a few minutes for a transaction to clear potentially dozens of times in a single day. So my guess is you largely deal with dong regardless of how you store your wealth.

This just sounds like a quick sound bite where the day to day realities would tell a more nuanced story.

If it were more convenient, then more people would be doing it. There is nothing convenient about setting up a bitcoin wallet and converting your money back-and-forth between it dozens of times a week, if not a day. This is especially difficult without the regular use of exchanges, which many crypto advocates will try to dissuade you from storing any crypto on, because you are functionally just using a bank again at that point and exposing yourself. “Not your keys not your crypto,” plus another online account to get hacked.

Being your own bank is a ton of work and most people don’t want to deal with that.

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

#339

Post by [deleted] »

latchkey wrote: post #306
mvdtnz wrote: post #213

Earlier quoted context omitted.

> Moving large amounts of money I can do this with any remittance company > 24/7 worldwide Table stakes for any remit company > outside of any bank This is a con, not a pro. Banks add value and protect your money. They are regulated, insured and backed. > quickly All remit companies are instant nowadays (except in USA which has stupidly slow banking) > low transaction fee Bitcoin network fees are approximately equal…

> Banks add value and protect your money. They are regulated, insured and backed. Which country are you referring to exactly? Or do you only have a US centric view on these things?

[deleted]

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

#340

Post by herbst »

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…

> I could not even fathom why you would want to be holding onto even Bitcoin or Ether right now.

The US is not the world. There is far more usage and legit use of crypto than whatever US regulators seem to think.

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