Jeff Bezos once asked Warren Buffett why people did not follow Buffett's model of investing, since it had made Buffett the third richest person in the US. Buffett replied, "no one wants to get rich slowly".
Statement on Cryptocurrencies and Initial Coin Offerings
71–80 of 176 posts
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#72Earlier quoted context omitted.
The difference is nobody would attempt to buy this participation to resell it later for a higher price
Why not?
Because there would be no secondary market, no exchanges, no investors, etc. but if there existed such a market and issuers of these rights talked about how these can be resold for a higher price, then it's a different story
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#73Does anyone know if the SEC has any process to formally approach them and say "This is what we're planning on doing and the structure we're planning on using -- this where we're unclear; how would you treat this?" like the IRS has with Private Letter Rulings/Written Determinations?
They do indeed - you can request a "no-action letter" confirming that an activity you have described to the SEC is okay.
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#74> I believe that initial coin offerings – whether they represent offerings of securities or not – can be effective ways for entrepreneurs and others to raise funding, including for innovative projects. > We at the SEC are committed to promoting capital formation. The technology on which cryptocurrencies and ICOs are based may prove to be disruptive, transformative and efficiency enhancing. I am confident that develop…
If nothing else, the current bitcoin adventure is raising a general awareness of the nature of currency- that is, something that primary exists to be means of exchange, and not something that primarily exists to store value.
It seems obvious that ICOs should be treated as the sale of securities- its somewhat reassuring to see the SEC endorsing this view.
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#75Earlier quoted context omitted.
Why not?
Because there would be no secondary market, no exchanges, no investors, etc. but if there existed such a market and issuers of these rights talked about how these can be resold for a higher price, then it's a different story
Nothing in his description precluded those features.
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#76Re: Statement on Cryptocurrencies and Initial Coin Offerings
#77Earlier quoted context omitted.
A lot of that dumb money is being put in by wall street, so not sure you're right.
This is not my impression. It seems to me that the dumb money is people who made early fortunes in crypto or regular people looking to ride the next pump and dump. If Wall Street money is coming in it's mostly to take advantage of the dumb money for a quick profit, for example by getting preferential pricing or timing so they can sell to later investors).
> If Wall Street money is coming in it's mostly to take advantage of the dumb money for a quick profit,...
Examples? Is Goldman playing in the current bubble?
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#78Earlier quoted context omitted.
This is not my impression. It seems to me that the dumb money is people who made early fortunes in crypto or regular people looking to ride the next pump and dump. If Wall Street money is coming in it's mostly to take advantage of the dumb money for a quick profit, for example by getting preferential pricing or timing so they can sell to later investors).
I think most of the money that's going in is by people with more than the 250k limit. Above that you can market pretty much anything as long as you're honest, I think. So I don't think it would be affected much, except that ordinary users wouldn't be able to use it (unless they could get it on exchanges, which may be under different laws?) Not a simple question, I guess.
What's the 250k limit? (If you're speaking of Accredited Investors, the limit is $1m in net worth not including primary residence.)
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#79> I believe that initial coin offerings – whether they represent offerings of securities or not – can be effective ways for entrepreneurs and others to raise funding, including for innovative projects. > We at the SEC are committed to promoting capital formation. The technology on which cryptocurrencies and ICOs are based may prove to be disruptive, transformative and efficiency enhancing. I am confident that develop…
I think this is more negative for ICOs than your quotes imply. Look at this: > By and large, the structures of initial coin offerings that I have seen promoted involve the offer and sale of securities and directly implicate the securities registration requirements and other investor protection provisions of our federal securities laws. Basically, almost all ICOs so far are illegal. He says that it's possible to make…
> Basically, almost all ICOs so far are illegal.
They are only illegal in the US if they allow US citizens to participate, and the majority ban US citizens. So I think you have it backward.
Re: Statement on Cryptocurrencies and Initial Coin Offerings
#80> I believe that initial coin offerings – whether they represent offerings of securities or not – can be effective ways for entrepreneurs and others to raise funding, including for innovative projects. > We at the SEC are committed to promoting capital formation. The technology on which cryptocurrencies and ICOs are based may prove to be disruptive, transformative and efficiency enhancing. I am confident that develop…
I think this is more negative for ICOs than your quotes imply. Look at this: > By and large, the structures of initial coin offerings that I have seen promoted involve the offer and sale of securities and directly implicate the securities registration requirements and other investor protection provisions of our federal securities laws. Basically, almost all ICOs so far are illegal. He says that it's possible to make…
> almost all ICOs so far are illegal.
a lot of them are offering to sell you an asset that they advertise as being sure to appreciate, with the subtext that you will sell the asset at a later point for a gain. Selling something purely to be a store of value and appreciation is basically the textbook definition of a security, isn't it?