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Ok - seems strange, how can lending be a security? The naïveté of this statement by CB beggars belief. If you ask people for money now in exchange for more mon
by DenisM 5y ago
Ok - seems strange, how can lending be a security?
The naïveté of this statement by CB beggars belief. If you ask people for money now in exchange for more money later you’re creating a security. The law has been on the books since 1933.
- darksaints 5y agoA security is by definition a tradable instrument. Your bank account is not tradable, and therefore is not a security, despite the fact that you are lending the bank money and interest is paid in return.
- ehnto 5y agoBut coinbase is explicit abut not being a bank, so is it a tradeable instrument or a savings account? Or can it be something else?
- darksaints 5y agoYou don't have to be a bank to offer an interest bearing account.
- TomSwirly 5y agoYour implied claim is that you can set up a system to offer interest bearing accounts, and not be subject to any sort of regulation. This is false. Either you are something like a bank or an insurance company that has its own regulation, or you are regulated by the SEC. You can't just magically say, "I'm a not a thing at all, you can't regulate me!" This is the "sovereign citizen" argument applied to the SEC.
- darksaints 5y agoWhat the actual fuck? Never once have I said that these wouldn't be regulated, nor has the Coinbase CEO, and I have no fucking clue how you would jump to that conclusion. Jesus Christ...what a fucking moronic straw man. There are over a dozen financial regulatory bodies that are not the SEC. FINRA is the most likely choice here, considering the fact that they already regulate securities lending.
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- JohnHaugeland 5y agoHe's right. You don't have the option to choose which laws apply to you, and your attempt to explain why is irrelevant, as the law does not support your claimed definition The SEC is getting involved because they are the correct people to handle this. This is not something an outsider should be trying to pan as someone else's wheelhouse.
- darksaints 5y agoNo, he's not right because his entire argument was a straw man, trying to claim that I was sovereign citizen-ing financial regulation. The Coinbase CEO is not an idiot. He has been very clear that this would be a regulated instrument. The SEC has no jurisdiction here. Either this is an interest-bearing currency lending account, for which the FDIC would be the regulatory body, or it is a securities lending account, for which FINRA would be the regulatory body. The SEC has not ever regulated securities lending or interest bearing accounts. They have also never had any regulatory authority over non-tradable financial instruments. They're literally the least likely agency to get this turf, which is why industry insiders like Matt Levine are shocked by this. It's only complete outsiders like you that think the SEC has any stake here, because you have a completely facile understand of the jurisdictions of the financial regulatory bodies in the US.
- agency 5y agoDo you have a source for Matt "Everything is Securities Fraud" Levine being shocked by this? He seems like the last person I'd expect to be surprised by the SEC's broad mandate.
- ahahahahah 5y ago
- rchaud 5y agoIs it possible this sort of disingenuous attitude is an act? It seemed to work for Uber and Airbnb. They skirted by on legal technicalities until they had enough VC-funded legal firepower to tip the scales in their favour.