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> They have only told us that they are assessing our Lend product through the prism of decades-old Supreme Court cases called Howey and Reves ... These two case

by fogof 5y ago

> They have only told us that they are assessing our Lend product through the prism of decades-old Supreme Court cases called Howey and Reves ... These two cases are from 1946 and 1990. Trying to make out like Howey is some obscure precedent from decades ago which the SEC is nitpicking over. The Howey test is the test applied to determine if something is an investment contract.

onlyrealcuzzo 5y ago
It's also like saying - I can't believe they're not letting us operate an Atlantic Slave Trade - because of some supreme court cases from decades ago. Why should the decades matter? Supreme court cases matter...
- cscurmudgeon 5y ago
  Or the US constitution, centuries old.
- ternaryoperator 5y ago
  That's a very poor analogy. It's inflammatory and disrespectful to put a trivial disagreement over investment classification on the same footing as the slave trade, and it's not factual either. Slave trade was not abolished by the Supreme Court, but by an act of Congress [0] and later by presidential decree [1]. [0] https://www.history.com/this-day-in-history/congress-abolishes-the-african-slave-trade https://www.history.com/this-day-in-history/congress-abolish... [1] Emancipation Proclamation
  - dehrmann 5y ago
    Nit: the Emancipation Proclamation only freed slaves in states rebelling against the union. Slavery was perfectly legal in Kentucky until December 18, 1865.
    - ternaryoperator 5y ago
      That is just a nit, as you say. The point is that the Supreme Court had nothing to do with ending the slave trade.
      - Gibbon1 5y ago
        During and after civil war the Supreme Court was problematic and the Republicans solved the problem in part by packing it.
  - dehrmann 5y ago
    Reductio ad absurdum is a valid argument.
    - itogglebits 5y ago
      That's not reduction ad absurdum. [0] [0] https://en.wikipedia.org/wiki/Reductio_ad_absurdum https://en.wikipedia.org/wiki/Reductio_ad_absurdum
      - edanm 5y ago
        That's exactly reductio ad absurdum. Quoting your own link: > [a] form of argument that attempts to establish a claim by showing that the opposite scenario would lead to absurdity or contradiction. The claim parent is attempting to establish is "how old a law is doesn't matter". The extreme example is ignoring an old law that abolishes the slave trade, and claims it is unimportant because it is decades old, which (parent is claiming) is absurd. Therefore, the original claim is absurd.
  - vmception 5y ago
    Nobody cares because we understood the point.
alasdair_ 5y ago
The Howey Test is absurdly broad. Two kids pooling their pocket money to buy the extra large bag of candy with a plan sell the extra gummy worms meets all four parts of the Howey Test and is unlicensed securities creation. Reminds me of the Bloomberg article "Everything Everywhere is Securities Fraud" https://www.bloomberg.com/opinion/articles/2019-06-26/everything-everywhere-is-securities-fraud https://www.bloomberg.com/opinion/articles/2019-06-26/everyt...
- jmchuster 5y ago
  I don't see how that passes "effort of others". They're clearly working in the sales and distribution business at that point. Now, if they then went around the school and said to everyone, give us $1 and we'll pay you back by splitting half of the profits from our sale, then yes, that sounds very much like a security.
- imtringued 5y ago
  Eating half the bag of candy is a loss though. You'd have to sell the other half for twice the price just to break even and if you promised the other kid that he gets back more than he spent then it is pretty damn close to a security.
- elliekelly 5y ago
  Your example very clearly doesn’t meet the Howey test though?
jmchuster 5y ago
And Reves is the Court doubling down on Howey and saying, yes, our decision from 1946 totally still works 50 years later, here's us restating it for you if you're still confused.
madamelic 5y ago
I am going to guess the article is PR to Coinbase going ahead with plans and getting sued, in the hopes they set a new precedent. I am cautiously hopeful for cryptocurrency in general, but this genuinely seems like it would be an easy lay up for the SEC.
- vmception 5y ago
  There are plenty of exemptions for Coinbase to lean on The SEC doesn't get to know which one, so if they auto-disagree let them waste their budget finding out in court This will be a decent dip to buy Coinbase stock from paper hand bootlickers
vmception 5y ago
The Supreme Court of 1910 declared “motion pictures” to not be covered by the first amendment Reversing itself in the 1950s, long after religious and exclusionary states made censorship boards across the republic It is absolutely possible to create room for introspection for old rulings

by fogof 5y ago

onlyrealcuzzo 5y ago

It's also like saying - I can't believe they're not letting us operate an Atlantic Slave Trade - because of some supreme court cases from decades ago. Why should the decades matter? Supreme court cases matter...

cscurmudgeon 5y ago
Or the US constitution, centuries old.
ternaryoperator 5y ago
That's a very poor analogy. It's inflammatory and disrespectful to put a trivial disagreement over investment classification on the same footing as the slave trade, and it's not factual either. Slave trade was not abolished by the Supreme Court, but by an act of Congress [0] and later by presidential decree [1]. [0] https://www.history.com/this-day-in-history/congress-abolishes-the-african-slave-trade https://www.history.com/this-day-in-history/congress-abolish... [1] Emancipation Proclamation
- dehrmann 5y ago
  Nit: the Emancipation Proclamation only freed slaves in states rebelling against the union. Slavery was perfectly legal in Kentucky until December 18, 1865.
  - ternaryoperator 5y ago
    That is just a nit, as you say. The point is that the Supreme Court had nothing to do with ending the slave trade.
    - Gibbon1 5y ago
      During and after civil war the Supreme Court was problematic and the Republicans solved the problem in part by packing it.
- dehrmann 5y ago
  Reductio ad absurdum is a valid argument.
  - itogglebits 5y ago
    That's not reduction ad absurdum. [0] [0] https://en.wikipedia.org/wiki/Reductio_ad_absurdum https://en.wikipedia.org/wiki/Reductio_ad_absurdum
    - edanm 5y ago
      That's exactly reductio ad absurdum. Quoting your own link: > [a] form of argument that attempts to establish a claim by showing that the opposite scenario would lead to absurdity or contradiction. The claim parent is attempting to establish is "how old a law is doesn't matter". The extreme example is ignoring an old law that abolishes the slave trade, and claims it is unimportant because it is decades old, which (parent is claiming) is absurd. Therefore, the original claim is absurd.
- vmception 5y ago
  Nobody cares because we understood the point.

alasdair_ 5y ago

The Howey Test is absurdly broad. Two kids pooling their pocket money to buy the extra large bag of candy with a plan sell the extra gummy worms meets all four parts of the Howey Test and is unlicensed securities creation. Reminds me of the Bloomberg article "Everything Everywhere is Securities Fraud" https://www.bloomberg.com/opinion/articles/2019-06-26/everything-everywhere-is-securities-fraud https://www.bloomberg.com/opinion/articles/2019-06-26/everyt...

jmchuster 5y ago
I don't see how that passes "effort of others". They're clearly working in the sales and distribution business at that point. Now, if they then went around the school and said to everyone, give us $1 and we'll pay you back by splitting half of the profits from our sale, then yes, that sounds very much like a security.
imtringued 5y ago
Eating half the bag of candy is a loss though. You'd have to sell the other half for twice the price just to break even and if you promised the other kid that he gets back more than he spent then it is pretty damn close to a security.
elliekelly 5y ago
Your example very clearly doesn’t meet the Howey test though?

jmchuster 5y ago

And Reves is the Court doubling down on Howey and saying, yes, our decision from 1946 totally still works 50 years later, here's us restating it for you if you're still confused.

madamelic 5y ago

I am going to guess the article is PR to Coinbase going ahead with plans and getting sued, in the hopes they set a new precedent. I am cautiously hopeful for cryptocurrency in general, but this genuinely seems like it would be an easy lay up for the SEC.

vmception 5y ago
There are plenty of exemptions for Coinbase to lean on The SEC doesn't get to know which one, so if they auto-disagree let them waste their budget finding out in court This will be a decent dip to buy Coinbase stock from paper hand bootlickers

vmception 5y ago

The Supreme Court of 1910 declared “motion pictures” to not be covered by the first amendment Reversing itself in the 1950s, long after religious and exclusionary states made censorship boards across the republic It is absolutely possible to create room for introspection for old rulings