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> fraud is not even illegal Just like all other non-bank fintech companies (like Paypal, Square, etc.), US crypto exchanges are regulated by FinCEN, the Bank S

> fraud is not even illegal Just like all other non-bank fintech companies (like Paypal, Square, etc.), US crypto exchanges are regulated by FinCEN, the Bank Secrecy Act, and the Patriot Act, and are obviously legally liable if they try to commit fraud. Most other countries have similar money servicing legislation, and even if they didn't, fraud is still illegal in all but the least legally responsive jurisdictions. Committing fraud doesn't suddenly become legal just because your company is classed as a crypto exchange. Now, just like there will always be a poorly regulated bank somewhere in the world, there will always be a poorly regulated crypto exchange somewhere in the world. > Need an example of crypto-fraud? The most widespread example is Tether, USDT. The idea that USDT is backed by USD is a well known joke. No one really knows the full extent of this fraud but all indications are it is one of epic proportions. > > Yet the exchanges maintain the $1 peg for USDT. USDT is a Bitfinex product. If you believe that "the exchanges" other than Bitfinex are in on Tether, I'd like to hear your reasoning. Most likely, the USDT fraud will collapse at some point, and the rest of the exchanges besides Bitfinex, along with the rest of the crypto market, will go on business as usual after a short market scare.

jqpabc123 5y ago
Committing fraud doesn't suddenly become legal just because your company is classed as a crypto exchange. Yes, it does. Crypto isn't a regulated market. As long as the scam stays inside crypto land, it is totally legal. As far as the SEC and CFTC are concerned, you're playing a game with Monopoly money. Elon Musk can and has openly run crypto "pump and dump" scams that would be blatantly illegal in any regulated market. The only response from the CFTC was a warning to consumers. https://www.cftc.gov/PressRoom/PressReleases/7697-18 https://www.cftc.gov/PressRoom/PressReleases/7697-18 If you believe that "the exchanges" other than Bitfinex are in on Tether, I'd like to hear your reasoning. The only way to maintain a firm 1 USD peg that everyone (even you) knows is a fraud is through collusion.
- everfree 5y ago
  > Yes, it does. Crypto isn't a regulated market. As long as the scam stays inside crypto land, it is totally legal. As far as the SEC and CFTC are concerned, you're playing a game with Monopoly money. That's your opinion. I would be more interested in the opinion of a judge. If you can demonstrate that monopoly money has some kind of market value, and someone else steals it from you, then that's a crime. There is no legal precedent set that fraud is okay as long as it involves cryptocurrency. > Elon Musk can and has openly run crypto "pump and dump" scams that would be blatantly illegal in any regulated market. The only response from the CFTC was a warning to consumers. The CFTC is a mess, so just because they aren't successfully helping prosecute a specific case doesn't mean everything that was done was legal. > The only way to maintain a firm 1 USD peg that everyone (even you) knows is a fraud is through collusion. They don't maintain a firm peg. Tether trades on exchanges at market value, just like any other cryptocurrency. Also, I find your "even you" comment to be a strange personal attack. Are you trying to say that I'm stupid?
  - jqpabc123 5y ago
    That's your opinion. The fact that crypto is unregulated is not just my opinion --- and I think you know that --- or at least you should. They don't maintain a firm peg. Tether trades on exchanges at market value, just like any other cryptocurrency. Pure speculation and misplaced trust on your part. The truth is you really have no way to *know* what the exchanges do to set the "market value" of USDT. Are you trying to say that I'm stupid? No, I'm referring to the fact that you called Tether a fraud --- "the USDT fraud will collapse at some point" --- your words, not mine.

jqpabc123 5y ago

Committing fraud doesn't suddenly become legal just because your company is classed as a crypto exchange. Yes, it does. Crypto isn't a regulated market. As long as the scam stays inside crypto land, it is totally legal. As far as the SEC and CFTC are concerned, you're playing a game with Monopoly money. Elon Musk can and has openly run crypto "pump and dump" scams that would be blatantly illegal in any regulated market. The only response from the CFTC was a warning to consumers. https://www.cftc.gov/PressRoom/PressReleases/7697-18 https://www.cftc.gov/PressRoom/PressReleases/7697-18 If you believe that "the exchanges" other than Bitfinex are in on Tether, I'd like to hear your reasoning. The only way to maintain a firm 1 USD peg that everyone (even you) knows is a fraud is through collusion.

everfree 5y ago
> Yes, it does. Crypto isn't a regulated market. As long as the scam stays inside crypto land, it is totally legal. As far as the SEC and CFTC are concerned, you're playing a game with Monopoly money. That's your opinion. I would be more interested in the opinion of a judge. If you can demonstrate that monopoly money has some kind of market value, and someone else steals it from you, then that's a crime. There is no legal precedent set that fraud is okay as long as it involves cryptocurrency. > Elon Musk can and has openly run crypto "pump and dump" scams that would be blatantly illegal in any regulated market. The only response from the CFTC was a warning to consumers. The CFTC is a mess, so just because they aren't successfully helping prosecute a specific case doesn't mean everything that was done was legal. > The only way to maintain a firm 1 USD peg that everyone (even you) knows is a fraud is through collusion. They don't maintain a firm peg. Tether trades on exchanges at market value, just like any other cryptocurrency. Also, I find your "even you" comment to be a strange personal attack. Are you trying to say that I'm stupid?
- jqpabc123 5y ago
  That's your opinion. The fact that crypto is unregulated is not just my opinion --- and I think you know that --- or at least you should. They don't maintain a firm peg. Tether trades on exchanges at market value, just like any other cryptocurrency. Pure speculation and misplaced trust on your part. The truth is you really have no way to *know* what the exchanges do to set the "market value" of USDT. Are you trying to say that I'm stupid? No, I'm referring to the fact that you called Tether a fraud --- "the USDT fraud will collapse at some point" --- your words, not mine.