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It's not clear that the SEC has jurisdiction here; there doesn't seem to be a bright line test deciding if crypto is a security or a commodity. This behavior mi

It's not clear that the SEC has jurisdiction here; there doesn't seem to be a bright line test deciding if crypto is a security or a commodity. This behavior might be better regulated by the FTC than the SEC.

arcticbull 4y ago
Sure there is, it's the Howey Test and the SEC has a whole publication on how to apply it to crypto. Fun fact, it's probably safe to assume that any ICO is a securities offering. [1] This is a case of "there is a bright line but the community doesn't like where they painted it, so they pretend there isn’t one." [1] https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets https://www.sec.gov/corpfin/framework-investment-contract-an...
- junofan 4y ago
  The CFTC disagrees [1]. Hardly a bright line. [1]: https://decrypt.co/123032/cftc-chair-says-ethereum-is-a-commodity-despite-genslers-bitcoin-only-position?amp=1 https://decrypt.co/123032/cftc-chair-says-ethereum-is-a-comm...
  - arcticbull 4y ago
    He would say that because he wants jurisdiction. His argument appears to be "let's just sunk-cost our way through instead of actually doing the correct thing." > “It’s been listed on CFTC exchanges for quite some time, and for that reason,” said Behnam, who argued that it creates a “direct jurisdictional hook” for the agency to police both ETH’s derivatives market and underlying market. Either way they're literally only talking about ETH, which is again, clearly a security as following their framework, nothing else has a long history of being listed on a CFTC exchange. But I digress.
    - junofan 4y ago
      I feel like you’re painting good-faith disagreement as “community pretending there isn’t a bright red line” or “he would say that because he wants jurisdiction,” so I don’t think there’s more to talk about.
      - pessimizer 4y ago
        There's no basis for arguing about your feelings. Your emotions are yours.
    - humanizersequel 4y ago
      >He would say that because he wants jurisdiction You can make the same argument about the SEC.
- simple-thoughts 4y ago
  The Howey test would mean Nike shoes are securities. - Investment of money: Nike charges for shoes. - Expectation of profit: people buy limited edition expecting hoping they go up in value. - Efforts of others: The shoes go up in value because Nike won’t issue more shoes, will promote the shoes, and will continue to make investments in its brand. Also these all pass the Howey test and in your view would be securities: - Breakfast cereal with toys inside - Condos - World of Warcraft items And essentially anything people might sell for a profit. The Howey test is a starting point but no matter what the SEC says, the courts don’t actually believe that everything is a security. The Howey test is not enshrined in law but is rather a heuristic starting point.
  - deleted 4y ago
    [deleted]
- kevinpet 4y ago
  You don't need to blindly defer to a regulator when they say their authority extends to cover something. For example, the CDC claimed to have authority over evictions https://www.scotusblog.com/2021/08/court-lifts-federal-ban-on-evictions/ https://www.scotusblog.com/2021/08/court-lifts-federal-ban-o...

arcticbull 4y ago

Sure there is, it's the Howey Test and the SEC has a whole publication on how to apply it to crypto. Fun fact, it's probably safe to assume that any ICO is a securities offering. [1] This is a case of "there is a bright line but the community doesn't like where they painted it, so they pretend there isn’t one." [1] https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets https://www.sec.gov/corpfin/framework-investment-contract-an...

junofan 4y ago
The CFTC disagrees [1]. Hardly a bright line. [1]: https://decrypt.co/123032/cftc-chair-says-ethereum-is-a-commodity-despite-genslers-bitcoin-only-position?amp=1 https://decrypt.co/123032/cftc-chair-says-ethereum-is-a-comm...
- arcticbull 4y ago
  He would say that because he wants jurisdiction. His argument appears to be "let's just sunk-cost our way through instead of actually doing the correct thing." > “It’s been listed on CFTC exchanges for quite some time, and for that reason,” said Behnam, who argued that it creates a “direct jurisdictional hook” for the agency to police both ETH’s derivatives market and underlying market. Either way they're literally only talking about ETH, which is again, clearly a security as following their framework, nothing else has a long history of being listed on a CFTC exchange. But I digress.
  - junofan 4y ago
    I feel like you’re painting good-faith disagreement as “community pretending there isn’t a bright red line” or “he would say that because he wants jurisdiction,” so I don’t think there’s more to talk about.
    - pessimizer 4y ago
      There's no basis for arguing about your feelings. Your emotions are yours.
  - humanizersequel 4y ago
    >He would say that because he wants jurisdiction You can make the same argument about the SEC.
simple-thoughts 4y ago
The Howey test would mean Nike shoes are securities. - Investment of money: Nike charges for shoes. - Expectation of profit: people buy limited edition expecting hoping they go up in value. - Efforts of others: The shoes go up in value because Nike won’t issue more shoes, will promote the shoes, and will continue to make investments in its brand. Also these all pass the Howey test and in your view would be securities: - Breakfast cereal with toys inside - Condos - World of Warcraft items And essentially anything people might sell for a profit. The Howey test is a starting point but no matter what the SEC says, the courts don’t actually believe that everything is a security. The Howey test is not enshrined in law but is rather a heuristic starting point.
- deleted 4y ago
  [deleted]
kevinpet 4y ago
You don't need to blindly defer to a regulator when they say their authority extends to cover something. For example, the CDC claimed to have authority over evictions https://www.scotusblog.com/2021/08/court-lifts-federal-ban-on-evictions/ https://www.scotusblog.com/2021/08/court-lifts-federal-ban-o...