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Uhh, the SEC said that bitcoin is not a security, but a currency. Like Euro or Yen. [1] They also said that some cryptos on coinbase are securities, but when c

Uhh, the SEC said that bitcoin is not a security, but a currency. Like Euro or Yen. [1] They also said that some cryptos on coinbase are securities, but when coinbase asked which ones, the SEC said „lol we won’t tell you but we will probably sue you soon for that“. [2] [1] https://www.investopedia.com/news/sec-chair-says-bitcoin-not-security/ https://www.investopedia.com/news/sec-chair-says-bitcoin-not... [2] https://www.coinbase.com/blog/we-asked-the-sec-for-reasonable-crypto-rules-for-americans-we-got-legal https://www.coinbase.com/blog/we-asked-the-sec-for-reasonabl...

polygamous_bat 3y ago
> They also said that some cryptos on coinbase are securities, but when coinbase asked which ones, the SEC said „lol we won’t tell you but we will probably sue you soon for that“. [2] Why is SEC supposed to do the job of Coinbase's lawyers? If I want to make a shitcoin tomorrow and ask the SEC for "regulatory clarity", are they required to respond to me? What if I programmatically create a new shitcoin every 30 seconds? Am I also allowed to cook up some substances and mail them to the DEA to get some "regulatory clarity"? Coinbase does business in a legally unclear area, which is why its primary expense should be lawyers. You can't just skimp on that and expect government agencies to do your work for you. If you try that, good luck defending yourself in court.
- super256 3y ago
  > Why is SEC supposed to do the job of Coinbase's lawyers? The current legal framework for determining whether something is a security or not is the Howey test [1]. And it looks like that Coinbase's listings pass the test? If they didn't, they would've been sued already. Why try to redefine what makes up a security on the fly without telling anyone? [1] https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets https://www.sec.gov/corpfin/framework-investment-contract-an...
  - growse 3y ago
    > And it looks like that Coinbase's listings pass the test? If they didn't, they would've been sued already. Sued by who? The SEC? Who have told them that they intend to bring a legal action?
    - super256 3y ago
      > Sued by who? The SEC? Who have told them that they intend to bring a legal action? Yes! They initially reviewed CB's S-1, determined the model + products are legal, and allowed them to become a public company. CB's model hasn't changed since then, but now it's supposedly illegal without any change in legislation? Good regulation happens in dialogue, like when CFDs and warrants were banned for retail. I don't think that's too much to ask for.
      - polygamous_bat 3y ago
        It may be useful to think of an example of a pharmaceutical company. For a pharma company that wants to go public, SEC checks to see whether they're cooking their books or lying to their investors in any form. It's FDA's job to make sure the drug they're selling doesn't make people's heads fall off. Similarly, I would assume there are multiple teams within SEC, some for basic public disclosure/due diligence checking, and others for crypto regulations and enforcement. Just because one of the teams took longer to take action doesn't mean their entire lawsuit is invalid now.
      - growse 3y ago
        > Yes! They initially reviewed CB's S-1, determined the model + products are legal, and allowed them to become a public company. CB's model hasn't changed since then, but now it's supposedly illegal without any change in legislation? That's not how this works. That's not how any of this works Have you read the S1? It's a prospectus which details the general business model and strategy for Coinbase the company, to provide context around the registration of Coinbase stock as securities. It talks a lot about Bitcoin and Ethereum in general, but what it doesn't do is provide a list of every single product that Coinbase might sell at some point in the future for the SEC to vet and declare "legal". Selling unregistered securities is illegal regardless of whether you're a public company or not, I'm really not sure how this weird fixation on Coinbase's IPO filings is relevant. In any case, if I set up as a pharmaceutical company, go public etc. and then suddenly start selling heroin to the general public, you can't ding the DEA/FDA/whoever for "allowing me to become a public company". Looking on the Coinbase website, they currently offer 257 "tradable" assets. If the SEC thinks any one of these is a security, and they've not been registered (show me the S1 for, I don't know, "IoTex"), then they're going to bring an action. > Good regulation happens in dialogue, like when CFDs and warrants were banned for retail. I don't think that's too much to ask for. I've a lot of sympathy with this view, but the regulators are inherently a political organisation and you play the government you're dealt. If the SEC isn't interested in a dialogue (and they're not legally obliged to be), then you do the thing and wait to get sued. Or don't do the thing!

polygamous_bat 3y ago

> They also said that some cryptos on coinbase are securities, but when coinbase asked which ones, the SEC said „lol we won’t tell you but we will probably sue you soon for that“. [2] Why is SEC supposed to do the job of Coinbase's lawyers? If I want to make a shitcoin tomorrow and ask the SEC for "regulatory clarity", are they required to respond to me? What if I programmatically create a new shitcoin every 30 seconds? Am I also allowed to cook up some substances and mail them to the DEA to get some "regulatory clarity"? Coinbase does business in a legally unclear area, which is why its primary expense should be lawyers. You can't just skimp on that and expect government agencies to do your work for you. If you try that, good luck defending yourself in court.

super256 3y ago
> Why is SEC supposed to do the job of Coinbase's lawyers? The current legal framework for determining whether something is a security or not is the Howey test [1]. And it looks like that Coinbase's listings pass the test? If they didn't, they would've been sued already. Why try to redefine what makes up a security on the fly without telling anyone? [1] https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets https://www.sec.gov/corpfin/framework-investment-contract-an...
- growse 3y ago
  > And it looks like that Coinbase's listings pass the test? If they didn't, they would've been sued already. Sued by who? The SEC? Who have told them that they intend to bring a legal action?
  - super256 3y ago
    > Sued by who? The SEC? Who have told them that they intend to bring a legal action? Yes! They initially reviewed CB's S-1, determined the model + products are legal, and allowed them to become a public company. CB's model hasn't changed since then, but now it's supposedly illegal without any change in legislation? Good regulation happens in dialogue, like when CFDs and warrants were banned for retail. I don't think that's too much to ask for.
    - polygamous_bat 3y ago
      It may be useful to think of an example of a pharmaceutical company. For a pharma company that wants to go public, SEC checks to see whether they're cooking their books or lying to their investors in any form. It's FDA's job to make sure the drug they're selling doesn't make people's heads fall off. Similarly, I would assume there are multiple teams within SEC, some for basic public disclosure/due diligence checking, and others for crypto regulations and enforcement. Just because one of the teams took longer to take action doesn't mean their entire lawsuit is invalid now.
    - growse 3y ago
      > Yes! They initially reviewed CB's S-1, determined the model + products are legal, and allowed them to become a public company. CB's model hasn't changed since then, but now it's supposedly illegal without any change in legislation? That's not how this works. That's not how any of this works Have you read the S1? It's a prospectus which details the general business model and strategy for Coinbase the company, to provide context around the registration of Coinbase stock as securities. It talks a lot about Bitcoin and Ethereum in general, but what it doesn't do is provide a list of every single product that Coinbase might sell at some point in the future for the SEC to vet and declare "legal". Selling unregistered securities is illegal regardless of whether you're a public company or not, I'm really not sure how this weird fixation on Coinbase's IPO filings is relevant. In any case, if I set up as a pharmaceutical company, go public etc. and then suddenly start selling heroin to the general public, you can't ding the DEA/FDA/whoever for "allowing me to become a public company". Looking on the Coinbase website, they currently offer 257 "tradable" assets. If the SEC thinks any one of these is a security, and they've not been registered (show me the S1 for, I don't know, "IoTex"), then they're going to bring an action. > Good regulation happens in dialogue, like when CFDs and warrants were banned for retail. I don't think that's too much to ask for. I've a lot of sympathy with this view, but the regulators are inherently a political organisation and you play the government you're dealt. If the SEC isn't interested in a dialogue (and they're not legally obliged to be), then you do the thing and wait to get sued. Or don't do the thing!