4 ms·

I mean, it's some progress, I guess. How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems

I mean, it's some progress, I guess. How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems to be a never-ending trail of those.

3np 4y ago
It's not super clear but it seems like that's essentially part of what they're being charged for and was behind the first C&D? I do think there's a lot more underway and coming.
flatiron 4y ago
I’m not educated on crypto but wouldn’t it be easier to go after the fiat->coin people or do people really just mine / buy coin with cash?
- TedDoesntTalk 4y ago
  What crime are the fiat->coin exchanges committing? (Excluding the insider trading of one individual at coinbase)
  - hnthrow1010 4y ago
    If you ask me, they should all be shut down for selling unregistered securities, because all crypto tokens fit closest to that definition more than anything else. It's impossible for these tokens to actually function as a currency, both technically and legally. They're not a new class of assets, the idea of tradable tokens is not new either.
    - flatiron 4y ago
      Exactly my point. They are selling in fiat currency a lie. That 100% is accessible for litigation. The whole crypto->crypto thing could be seen as not a crime because who can tell it’s worth other than the darn fiat converter!
  - brasic 4y ago
    To add some nuance to the sibling reply, the SEC has extensively laid out its legal argument for why many (not all) of the coins traded on crypto exchanges are securities under US law, including specific examples. See the recent insider trading complaint [1] and this analysis [2]. Dealing in unregistered securities is a crime [3], so if the analysis is correct then the exchanges are breaking US law. [1] https://www.sec.gov/litigation/complaints/2022/comp-pr2022-127.pdf https://www.sec.gov/litigation/complaints/2022/comp-pr2022-1... (¶ 95 - ¶ 206) [2] https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets https://www.sec.gov/corpfin/framework-investment-contract-an... [3] https://www.law.cornell.edu/uscode/text/15/78l https://www.law.cornell.edu/uscode/text/15/78l
bobthepanda 4y ago
Prosecution takes time to build a solid case. The absence of news of prosecution does not necessarily mean an absence of prosecution. There are lots of reasons why you wouldn’t announce an ongoing investigation.
rvz 4y ago
> I mean, it's some progress, I guess. Ever wondered why the majority of ICOs in the US have been stamped out since 2017/2018? > How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems to be a never-ending trail of those. Until regulations are much clearer and those people who create such coins have to be registered and fully doxxed and exposed first perhaps. But either way, it is never going to fully go away, so some of them will slip through the net.
deleted 4y ago
[deleted]
threeseed 4y ago
They really should start with the celebrities and influencers e.g. Jake Paul who have been profiting by promoting these rug pull schemes to their audiences. At least it would help set a public example for others.
- arealaccount 4y ago
  Or the NFL for that matter. Lotta innocent people lost money thinking they been advertised legitimate companies.
Animats 4y ago
The SEC is running behind by about two years. They're still working through the ICO scams of 2019. Here's the current list of SEC "cyber" enforcement actions.[1] The SEC is mostly complaint-driven. When someone complains their money was stolen, they can investigate. So enforcement actions come during the collapse phase of scams. The "cyber" enforcement staff was recently doubled, so enforcement actions should pick up soon. The SEC pretty much shut down the ICO boom by sending out letters to coin issuers, "Please explain why your FooCoin isn't an unregistered securities offering." A few issuers filed an S-1 and registered as a security, while others just gave all the money back. We don't see many pure ICOs any more. We do see desperate attempts to make something a "utility token", used mostly for some other purpose than speculation. [1] https://www.sec.gov/spotlight/cybersecurity-enforcement-actions https://www.sec.gov/spotlight/cybersecurity-enforcement-acti...
orwin 4y ago
I'll get some heat, but i reached one of my school friend during covid and asked him what he was doing. He had a gig where he was coding snippets of solidity code to create "almost" solid coins, and publish those on the ethereum blockchain. And was paid a lot. Like FAANG level of money, in Europe (UK, it was a bit before Brexit). Now, i don't understand this particular tech very well, so i might make a mistake, but from what i understood, he was actually creating shitcoins "templates" which could seem seemingly rug pull immune (like wait time before withdrawal? Like i said, i don't know the space very well, it doesn't really interest me), but add a smallish backdoor. His company (it was 2 dev one marketing) then sold those coin template to diverse people and sold installation, formation and support of like six month. Would his company be targeted by the US gov? it seems like he was enabling scammers while not taking any personnal money from anyone. Wasn't this very sketchy? By the way, i think his company at first wanted to be on the "Wish" market (cheap dropshipped stuff from China) and then sold dropshipping websites template, so i guess this was actually a moral upgrade?
- paranoidrobot 4y ago
  > it seems like he was enabling scammers while not taking any personnal money from anyone. "X didn't scam anyone, X just sold a template that allowed others to scam". If there's no reasonable other legitimate purpose, then it's still profiting from scamming, albeit at one layer of abstraction. > Would his company be targeted by the US gov? If it turns out that he was enabling scammers to scam, then yeah - I would hope so.

I mean, it's some progress, I guess. How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems to be a never-ending trail of those.

3np 4y ago

It's not super clear but it seems like that's essentially part of what they're being charged for and was behind the first C&D? I do think there's a lot more underway and coming.

flatiron 4y ago

I’m not educated on crypto but wouldn’t it be easier to go after the fiat->coin people or do people really just mine / buy coin with cash?

TedDoesntTalk 4y ago
What crime are the fiat->coin exchanges committing? (Excluding the insider trading of one individual at coinbase)
- hnthrow1010 4y ago
  If you ask me, they should all be shut down for selling unregistered securities, because all crypto tokens fit closest to that definition more than anything else. It's impossible for these tokens to actually function as a currency, both technically and legally. They're not a new class of assets, the idea of tradable tokens is not new either.
  - flatiron 4y ago
    Exactly my point. They are selling in fiat currency a lie. That 100% is accessible for litigation. The whole crypto->crypto thing could be seen as not a crime because who can tell it’s worth other than the darn fiat converter!
- brasic 4y ago
  To add some nuance to the sibling reply, the SEC has extensively laid out its legal argument for why many (not all) of the coins traded on crypto exchanges are securities under US law, including specific examples. See the recent insider trading complaint [1] and this analysis [2]. Dealing in unregistered securities is a crime [3], so if the analysis is correct then the exchanges are breaking US law. [1] https://www.sec.gov/litigation/complaints/2022/comp-pr2022-127.pdf https://www.sec.gov/litigation/complaints/2022/comp-pr2022-1... (¶ 95 - ¶ 206) [2] https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets https://www.sec.gov/corpfin/framework-investment-contract-an... [3] https://www.law.cornell.edu/uscode/text/15/78l https://www.law.cornell.edu/uscode/text/15/78l

bobthepanda 4y ago

Prosecution takes time to build a solid case. The absence of news of prosecution does not necessarily mean an absence of prosecution. There are lots of reasons why you wouldn’t announce an ongoing investigation.

rvz 4y ago

> I mean, it's some progress, I guess. Ever wondered why the majority of ICOs in the US have been stamped out since 2017/2018? > How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems to be a never-ending trail of those. Until regulations are much clearer and those people who create such coins have to be registered and fully doxxed and exposed first perhaps. But either way, it is never going to fully go away, so some of them will slip through the net.

deleted 4y ago

[deleted]

threeseed 4y ago

They really should start with the celebrities and influencers e.g. Jake Paul who have been profiting by promoting these rug pull schemes to their audiences. At least it would help set a public example for others.

arealaccount 4y ago
Or the NFL for that matter. Lotta innocent people lost money thinking they been advertised legitimate companies.

Animats 4y ago

The SEC is running behind by about two years. They're still working through the ICO scams of 2019. Here's the current list of SEC "cyber" enforcement actions.[1] The SEC is mostly complaint-driven. When someone complains their money was stolen, they can investigate. So enforcement actions come during the collapse phase of scams. The "cyber" enforcement staff was recently doubled, so enforcement actions should pick up soon. The SEC pretty much shut down the ICO boom by sending out letters to coin issuers, "Please explain why your FooCoin isn't an unregistered securities offering." A few issuers filed an S-1 and registered as a security, while others just gave all the money back. We don't see many pure ICOs any more. We do see desperate attempts to make something a "utility token", used mostly for some other purpose than speculation. [1] https://www.sec.gov/spotlight/cybersecurity-enforcement-actions https://www.sec.gov/spotlight/cybersecurity-enforcement-acti...

orwin 4y ago

I'll get some heat, but i reached one of my school friend during covid and asked him what he was doing. He had a gig where he was coding snippets of solidity code to create "almost" solid coins, and publish those on the ethereum blockchain. And was paid a lot. Like FAANG level of money, in Europe (UK, it was a bit before Brexit). Now, i don't understand this particular tech very well, so i might make a mistake, but from what i understood, he was actually creating shitcoins "templates" which could seem seemingly rug pull immune (like wait time before withdrawal? Like i said, i don't know the space very well, it doesn't really interest me), but add a smallish backdoor. His company (it was 2 dev one marketing) then sold those coin template to diverse people and sold installation, formation and support of like six month. Would his company be targeted by the US gov? it seems like he was enabling scammers while not taking any personnal money from anyone. Wasn't this very sketchy? By the way, i think his company at first wanted to be on the "Wish" market (cheap dropshipped stuff from China) and then sold dropshipping websites template, so i guess this was actually a moral upgrade?

paranoidrobot 4y ago
> it seems like he was enabling scammers while not taking any personnal money from anyone. "X didn't scam anyone, X just sold a template that allowed others to scam". If there's no reasonable other legitimate purpose, then it's still profiting from scamming, albeit at one layer of abstraction. > Would his company be targeted by the US gov? If it turns out that he was enabling scammers to scam, then yeah - I would hope so.