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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

#341

Post by bdcravens »

herbst wrote: post #340
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.

True, but like in many things, it makes up a significant amount of the the market. What happens in the US will affect the market rate worldwide.

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

#342

Post by herbst »

bdcravens wrote: post #341
herbst wrote: post #340

Earlier quoted context omitted.

> 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.

True, but like in many things, it makes up a significant amount of the the market. What happens in the US will affect the market rate worldwide.

Got me curious now, indeed a lot of people in the US have crypto however on the big scale the US is just a small fraction Of all crypto holders.

Assuming that in a lot of these countries crypto is no big issue and others have long banned it and still a huge adoption I really doubt the US alone would make a huge lasting dent banning it.

* https://triple-a.io/crypto-ownership-data/

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

#343

Post by toomuchtodo »

jowea wrote: post #335
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?

Fine is less priority than investors because the government doesn't want to be taking recourse from those harmed.

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

#344

Post by esperent »

Closi wrote: post #336
esperent wrote: post #329

Earlier quoted context omitted.

> 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.

Here's my source, what's yours?

https://www.investopedia.com/tech/how-much-worlds-money-bitc...

Although this is using data from when Bitcoin was worth 50k.

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

#345

Post by staticman2 »

kodah wrote: post #141
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...

Broader question: Given that SEC enforcement is speculative (eg: we think this might be a security) do they have to pay damages when they're wrong? If not, why? If so, how much?

That makes as much sense as asking if a judge should pay damages if they are wrong. Define "wrong".

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

#346

Post by bdcravens »

herbst wrote: post #342
bdcravens wrote: post #341

Earlier quoted context omitted.

True, but like in many things, it makes up a significant amount of the the market. What happens in the US will affect the market rate worldwide.

Got me curious now, indeed a lot of people in the US have crypto however on the big scale the US is just a small fraction Of all crypto holders. Assuming that in a lot of these countries crypto is no big issue and others have long banned it and still a huge adoption I really doubt the US alone would make a huge lasting dent banning it. * https://triple-a.io/crypto-ownership-data/

Focusing strictly on the number of users tells only a small story, as a "user" can hold the tiniest percentage.

Overall value by country tells a more complete story; the US by far has the highest value traded.

https://originstamp.com/blog/the-top-10-countries-that-use-c...

https://www.statista.com/statistics/1195753/bitcoin-trading-...

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

#347

Post by jowea »

legitster wrote: post #155
seanhunter wrote: post #96

Earlier quoted context omitted.

I think you mean the SEC. That’s the agency here and yes, investor protection is part of the SEC’s mandate.

No, I meant the FTC which already settled with Celcius today: https://www.ftc.gov/news-events/news/press-releases/2023/07/...

I am somewhat confused about the situation, but your own link says

> The companies also agreed to a judgment of $4.7 billion, which will be suspended to permit Celsius to return its remaining assets to consumers in bankruptcy proceedings.

This seems like the FTC claims the judgment is suspend so the normal clientele can have its money back, not any institutional investors who knowingly put their money at risk by investing into the company itself.

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

#348

Post by jowea »

toomuchtodo wrote: post #343
jowea wrote: post #335

Earlier quoted context omitted.

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?

Fine is less priority than investors because the government doesn't want to be taking recourse from those harmed.

I went looking a little more, the FTC itself says something quite different, unless CNBC is calling the clients "investors".

> The companies also agreed to a judgment of $4.7 billion, which will be suspended to permit Celsius to return its remaining assets to consumers in bankruptcy proceedings.

https://www.ftc.gov/news-events/news/press-releases/2023/07/...

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

#349

Post by wpietri »

gamblor956 wrote: post #191
saurik wrote: post #113

Earlier quoted context omitted.

Which point of the Howey Test do you feel is not satisfied by Pokémon cards? (If your answer has anything to do with the existence of the game, I am curious what you think of baseball cards.) You state that they don't satisfy the test with quite some certainty but left the reasoning to the reader; but, it would seem, to me, like Pokémon cards are no different from many of these cryptocurrencies the SEC is interested…

(If your answer has anything to do with the existence of the game, I am curious what you think of baseball cards.) Yes, if you ignore the primary reason for Pokemon cards (the game), then they can magically be made to look like securities.... They then sell these things to people who are absolutely buying them with the expectation that they will go up in value. No, completely false and this betrays a complete lack of…

Ooh, thanks for this comment. I am not by nature a collector, but now I get it.

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

#350

Post by wpietri »

TrapLord_Rhodo wrote: post #271
wpietri wrote: post #70

Earlier quoted context omitted.

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 t…

I have a lot of questions about people who are making $400k-$800k cash-like transactions. But as far as I'm concerned, that's another sign of Bitcoin's failure in terms of its original goals. That's a sign that Bitcoin is even less useful for productive economic activity.

> market cap is $600B

Sorry, but talking about "market cap" for currencies and commodities is ridiculous. What's the market cap of the US dollar? What's the market cap of gold? Those are fundamentally stupid questions, because "market cap" only applies to equities, which are pieces of a single entity that is both economically productive and owns a bunch of assets. Market capitalization matters because with a company, anybody with enough money can go out and buy the whole thing. It's not a meaningful number for a currency or a commodity. Or for a cryptocurrency.

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