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FTX exploited the lack of legal clarity and regulation inside the US - the solution would seem be to create those things not let it 'implode' due to their absen

FTX exploited the lack of legal clarity and regulation inside the US - the solution would seem be to create those things not let it 'implode' due to their absence.

phphphphp 4y ago
That's a soundbite that people like Brian Armstrong use, because it's shifting the blame onto The Enemy (the traditional finance system) but it's a hard sell. People engage with cryptocurrency because it offers the sort of unbounded financial opportunities only available when there's no regulation: there is already regulation that applies to all financial companies, the reason FTX primarily operated outside of the US was because of that regulation. Had there been "regulatory clarity" that further reiterated that what FTX was doing outside of the US isn't acceptable inside of the US, FTX would have remained outside of the US and continued to do the unregulated things. Anybody who wanted to use an exchange that complies with regulations could just use Coinbase. There's a reason people don't.
SilverBirch 4y ago
This doesn't make any sense. There is legal clarity and regulation inside the US. Crypto largely is deliberately attempting to create ambiguity. All the financial instruments created by crypto have real world regulated equivalents, whether that's ICOs or currencies of commodities. They already exist. What was FTX doing that CME, or a big hedge fund aren't? Well for one, FTX is a mix of those two businesses - why doesn't that exist in normal finance? Because of the dead obvious conflict of interests that we have seen resulted in exactly what happened at FTX. So what do you want? FTX to operate under the same regulations as traditional financial institutions? Ok. That's fine, but we already have those regulations, it's the crypto organisations that are pretending that they don't exist - for the exact reason they don't want to follow them.

FTX exploited the lack of legal clarity and regulation inside the US - the solution would seem be to create those things not let it 'implode' due to their absence.

phphphphp 4y ago

That's a soundbite that people like Brian Armstrong use, because it's shifting the blame onto The Enemy (the traditional finance system) but it's a hard sell. People engage with cryptocurrency because it offers the sort of unbounded financial opportunities only available when there's no regulation: there is already regulation that applies to all financial companies, the reason FTX primarily operated outside of the US was because of that regulation. Had there been "regulatory clarity" that further reiterated that what FTX was doing outside of the US isn't acceptable inside of the US, FTX would have remained outside of the US and continued to do the unregulated things. Anybody who wanted to use an exchange that complies with regulations could just use Coinbase. There's a reason people don't.

SilverBirch 4y ago

This doesn't make any sense. There is legal clarity and regulation inside the US. Crypto largely is deliberately attempting to create ambiguity. All the financial instruments created by crypto have real world regulated equivalents, whether that's ICOs or currencies of commodities. They already exist. What was FTX doing that CME, or a big hedge fund aren't? Well for one, FTX is a mix of those two businesses - why doesn't that exist in normal finance? Because of the dead obvious conflict of interests that we have seen resulted in exactly what happened at FTX. So what do you want? FTX to operate under the same regulations as traditional financial institutions? Ok. That's fine, but we already have those regulations, it's the crypto organisations that are pretending that they don't exist - for the exact reason they don't want to follow them.