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Coinbase Gets a Wells Notice

41 points by ForHackernews 5y ago

donatj 5y ago
> The arrogance is something to behold. It just reads like honest befuddlement to my eye. Basically “Wouldn’t it be easier if they just explained?” To which I 100% agree. I don’t think wanting an explanation is arrogance. I think this strikes at the core issues of our society. The primary mechanisms the government uses are punitive when they could instead guide and gently correct mistakes particularly where malice was not involved.
- blitzar 5y ago
  > Wouldn’t it be easier if they just explained? > Yet again, we asked if the SEC would share their reasoning with us, and yet again they refused. 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. I would like to think that Coinbase’s Chief Legal Officer is not a total idiot, but every lawyer I know takes extreme care with their written words. Contradicting yourself in back to back sentences makes me wonder if Coinbase are setting themselves up for a defence where their legal representatives, or management in general(?) are declared too incompetent to prosecute.
  - knaik94 5y ago
    I actually see a very clear distinction between the two sentences. A clear reasoning is much more than just a reference to an old court case. The entire point of the Howey Test is that it's applied specifically to each situation in which it's used. I think an outline of the Howey Test and how it's being applied by the SEC is what Coinbase is asking for.
    - blitzar 5y ago
      > we asked if the SEC would share their reasoning with us and they refused > They told us that they are assessing our Lend product through the prism of Howey and Reves The explanation may not have been to their liking, or not as many pages of written analysis as they would like, but it is incompatible to say they refused an explanation. It is not the job of the SEC to be the lawyer or complaince officer for the companies and market participants it regulates. If they are asking for an 'outline of the Howey Test' then they have some very serious problems. Sounds like gross incompetence from officials of a public company. If you are asking for that kind of basic information (try reading the investopedia article coinbase) at this stage, someone should be in jail. If on the other hand, the management of coinbase did click on the first link for 'Howey test' on google, and have an interpretation that supports their assertions, they are free to present that at any time.
      - donatj 5y ago
        > If you are asking for that kind of basic information at this stage, someone should be in jail. And again I ask why. Why should someone go to jail for asking for information? How does that help society? Why isn’t it the place of the government just to help businesses adhere to the laws rather than taking an adversarial role? If a business makes an honest mistake, why not work with the business to correct the mistake and help anyone injured rather than go punitive? Throw people in jail for malice, but not for mistakes or incompetence. It serves no one. The person does not come out of jail more competent nor unable to make mistakes.
        blitzar 5y ago
        > Throw people in jail for malice They are conducting a fraud against their shareholders. It is a public company and these people are proporting to be professionals while maintaining that they need the absolute most basic of basic concepts in their professional field explained to them. > Why isn’t it the place of the government just to help businesses adhere to the laws rather than taking an adversarial role? The business in question believes that the laws do not apply to them and that they are above the regulation. It is not an honest mistake they are making, it is a deliberate attempt to avoid the law. It is malice.
        te_acct 5y ago
        > Why isn’t it the place of the government just to help businesses adhere to the laws The government does a great job outlining exactly what the law is in great detail. It is the job of the companies general counsel to apply the law to their use-case. If they choose to play fast and loose with their interpretation of the law then they better have a good argument when they end up in court. > Throw people in jail for malice, but not for mistakes or incompetence This is not an individual making a mistake, it's a multi-billion dollar public company. Mistakes and incompetence are grounds for legal action. These are well established foundational laws that have been in place for decades. They have survived numerous different interpretations, and crypto is no different than the many other "new" financial instruments which came before it. > The person does not come out of jail more competent nor unable to make mistakes. The bar is set pretty high for white collar criminals. If you're an officer of a company and end up in prison, you most likely made some pretty egregious mistakes.
- stevage 5y ago
  The arrogance is the belief that it's ok to rant on Twitter about the SEC and there being no consequences because you're special and untouchable. No great problem having his opinions. Expressing them in that form is the delusional bit.
kibbleble 5y ago
As always, the private sector knows more about the industry than the government. And American history shows that governments are always playing catch-up.
deleted 5y ago
[deleted]

41 points by ForHackernews 5y ago

> The arrogance is something to behold. It just reads like honest befuddlement to my eye. Basically “Wouldn’t it be easier if they just explained?” To which I 100% agree. I don’t think wanting an explanation is arrogance. I think this strikes at the core issues of our society. The primary mechanisms the government uses are punitive when they could instead guide and gently correct mistakes particularly where malice was not involved.

blitzar 5y ago
> Wouldn’t it be easier if they just explained? > Yet again, we asked if the SEC would share their reasoning with us, and yet again they refused. 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. I would like to think that Coinbase’s Chief Legal Officer is not a total idiot, but every lawyer I know takes extreme care with their written words. Contradicting yourself in back to back sentences makes me wonder if Coinbase are setting themselves up for a defence where their legal representatives, or management in general(?) are declared too incompetent to prosecute.
- knaik94 5y ago
  I actually see a very clear distinction between the two sentences. A clear reasoning is much more than just a reference to an old court case. The entire point of the Howey Test is that it's applied specifically to each situation in which it's used. I think an outline of the Howey Test and how it's being applied by the SEC is what Coinbase is asking for.
  - blitzar 5y ago
    > we asked if the SEC would share their reasoning with us and they refused > They told us that they are assessing our Lend product through the prism of Howey and Reves The explanation may not have been to their liking, or not as many pages of written analysis as they would like, but it is incompatible to say they refused an explanation. It is not the job of the SEC to be the lawyer or complaince officer for the companies and market participants it regulates. If they are asking for an 'outline of the Howey Test' then they have some very serious problems. Sounds like gross incompetence from officials of a public company. If you are asking for that kind of basic information (try reading the investopedia article coinbase) at this stage, someone should be in jail. If on the other hand, the management of coinbase did click on the first link for 'Howey test' on google, and have an interpretation that supports their assertions, they are free to present that at any time.
    - donatj 5y ago
      > If you are asking for that kind of basic information at this stage, someone should be in jail. And again I ask why. Why should someone go to jail for asking for information? How does that help society? Why isn’t it the place of the government just to help businesses adhere to the laws rather than taking an adversarial role? If a business makes an honest mistake, why not work with the business to correct the mistake and help anyone injured rather than go punitive? Throw people in jail for malice, but not for mistakes or incompetence. It serves no one. The person does not come out of jail more competent nor unable to make mistakes.
      - blitzar 5y ago
        > Throw people in jail for malice They are conducting a fraud against their shareholders. It is a public company and these people are proporting to be professionals while maintaining that they need the absolute most basic of basic concepts in their professional field explained to them. > Why isn’t it the place of the government just to help businesses adhere to the laws rather than taking an adversarial role? The business in question believes that the laws do not apply to them and that they are above the regulation. It is not an honest mistake they are making, it is a deliberate attempt to avoid the law. It is malice.
      - te_acct 5y ago
        > Why isn’t it the place of the government just to help businesses adhere to the laws The government does a great job outlining exactly what the law is in great detail. It is the job of the companies general counsel to apply the law to their use-case. If they choose to play fast and loose with their interpretation of the law then they better have a good argument when they end up in court. > Throw people in jail for malice, but not for mistakes or incompetence This is not an individual making a mistake, it's a multi-billion dollar public company. Mistakes and incompetence are grounds for legal action. These are well established foundational laws that have been in place for decades. They have survived numerous different interpretations, and crypto is no different than the many other "new" financial instruments which came before it. > The person does not come out of jail more competent nor unable to make mistakes. The bar is set pretty high for white collar criminals. If you're an officer of a company and end up in prison, you most likely made some pretty egregious mistakes.
stevage 5y ago
The arrogance is the belief that it's ok to rant on Twitter about the SEC and there being no consequences because you're special and untouchable. No great problem having his opinions. Expressing them in that form is the delusional bit.

kibbleble 5y ago

As always, the private sector knows more about the industry than the government. And American history shows that governments are always playing catch-up.

deleted 5y ago

[deleted]