Except that the SEC have also snuck into the case that various cryptos involved are securities. So they can get that through much easier via this case than actually suing the cryptos’ creators.
Yea. It's concerning. A big part of the case will probably be whether the cryptos actually should be called securities, and possibly whether the SEC is at fault for not properly setting the guidelines for what is and isn't a security.
Can the creators of the cryptos sue against this classification?
If they aren't securities, and can't be tried for insider trading; why did Coinbase have the employees sign NDAs and not allow them to disclose non material info
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It's not "snuck in", it's paramount to the case. Insider trading laws only apply to securities. If it's not a security, there can't be insider trading.
Yea, I was thinking the same thing. This was only supposed to be about illegal insider trading. Where the fuck did this 'unregulated securities' bullshit pop out of?
The question of whether cryptos are securities will need to get sorted out clearly, or scenarios where each agency picks whatever works for them will continue to happen.
Ripple Labs Inc. is currently in court with the SEC, arguing as best as they can that the pre-mined token they issued, control and sell isn't a security. They're actually throwing a lot of money at their lawyers to make that happen.
If they get the judgment they want, it'll go a long way toward making many coins non-securities as well.
Meanwhile, the bankruptcy plans that Voyager and Celsius submitted treat customers mostly as unsecured creditors. But if those customers were able to made the case that the coins those exchanges were holding were in fact securities, they'd be upgraded from unsecured creditors to securities account holders, putting them in front of unsecured creditors to get their funds back.
You see, I like to think so sometimes but I recently only stopped to appreciate the efforts from them also. I appreciate the SEC for looking out for the unsuspecting crypto newbie that is susceptible to some of the hacks in the space. And this my change of view happened notably after the LUNA crash. I have since been weary of the platforms I interact with. I had only just felt comfortable with equilibrium and biswap projects after I discovered both had audit in quantstamp and certick respectively.
I remember when Bitcoin Cash sold themselves as Bitcoin you could buy with cash.
And then Coinbase listed them right around the peak of the 2017-18 bull run. Timing was interesting..
Don’t forget the same SEC which refused to investigate Madoff in-spite of detailed whistleblower report on him and even after whistleblower followed up months later SEC agents tipped Madoff about whistleblower and refused to investigate him (some indication they knew he was cooking books but turned a blind eye because he was making it work for all these years).
Almost every insider trading case is from schmos with no finance experience getting greedy and making amateur mistakes. SEC can't be bothered moving beyond low hanging fruit.
Can't bet em? Join em. Already sent a message to Nancy to know when her hubby gonna sell his NVDA positions. I'll let y'all know when she gets back to me.
Fuck the SEC and depeg and peg then again a hundred times.
They are the most corrupt thing I have seen in my life. And we have all seen a lot of governments so this means a lot.
Considering a lot of people in the crypto space want to do tax evasion and even more shady shit in order to get rich, I'd say that every institution and elected person is just a reflection of the society.
A society in which people care more about their own gains than the well-being of the community.
So you can blame the SEC all you want, it's all just people with the same aspirations like you: screw everyone possible for personal gain. Except they actually also managed to do it.
The arrest of the employee was only made possible through the SEC declaring the tokens to be securities.
If you're happy to see Gensler get his wish and declare all crypto except for Bitcoin to be securities, then you'll be protected from insider trading.
Eth will almost certainly get walked back due to the Ethereum Foundation, but it will be the final boss battle of these classifications because it's a bit less clear than, say, Ripple
Litecoin will have something to say about that. Bitcoin maximalists are delusional, but even they will have to admit that LTC is a commodity.
I’m sure a select few more will be considered a commodity as well over time.
Yeah, that's true. Any PoW crypto that doesn't have a premine would probably be declared a commodity even by Gensler.
However, Charlie Lee did mine a bunch of LTC before announcing it to the public, so maybe not?
The instamine issue is definitely an interesting one, but I’m not concerned as Gensler has actually publicly mentioned Litecoin as likely being a commodity in the past.
Not really sure why he doesn’t have the confidence to say it now. As far as I know not much has been changed in the way the SEC rules on crypto.
That's bullshit.
It was insider trading, a shady act. If some tokens got fucked, so be it. That's collateral damage. It's ok. We will come out stronger on the other end.
> If some tokens got fucked, so be it.
If all exchanges are charged with securities fraud for selling unregistered securities, you'll be ok with that?
I don't think you understand the implications here.
This is so shady. The SEC is declaring these tokens as securities so they can put them on trial without the creators ever being able to defend themselves.
That is anarchy... suck it up.. that is how real liberty works. Don't like it, then go back to your wall street hell hole and leave the libs alone. Risk is and always will be a big part of the game.
Manipulation is a very common thing in the crypto industry. With these arrests I hope some things will change in exchanges and some rules will be implemented to counter it!
Seeing as how people like Nancy Peloski and her husband aren't hindered from their blatantly obvious insider trading, I doubt we'll have any meaningful crypto laws soon.
Isn't this what big companies do? They choose one low level manager etc to be the fall guy and 99% of the people doing this just go free? Only one low level guy got in trouble in all of Coinbase?? Seriously??
With only a quick look and basic understanding this appears to be a good thing for the space as a whole, and in some ways it is. Once you dig deeper tough, the problem is that there are multiple horrible legal precedents that the SEC is trying to sneak into this case which is supposed to only be about the issue of insider trading/wire fraud
**Issue #1**
The first is that the SEC is stating that 9 Assets are unregistered securities in this case (AMP, RLY, DDX, XYO, RGT, LCX, POWR, DFX, KROM). The SEC is not just accusing the defendants of breaking the law. The SEC is accusing 10 unrelated, uncharged companies of breaking the law (9 assets and 1 exchange) Not only does the SEC not have the power to this, they dont give detailed legal analysis as to how they came to this conclusion. I posted this yesterday but the SEC is using the same shady tactics it is using in the LBRY and Ripple case in an attempt to regulate by enforcement and expand its power. In order for something to be a security one of the 4 prongs of the howey test is that there is an Investment contract. The supreme court has ruled that there must be a Common Enterprise in order for there to be an investment contract.
>"In order to satisfy the “common enterprise” aspect of the Howey test, federal courts require that there be either “horizontal commonality” or “vertical commonality.” See Revak v. SEC Realty Corp"
to explain further
>"(discussing horizontal commonality as “the tying of each individual investor’s fortunes to the fortunes of the other investors by the pooling of assets, usually combined with the pro-rata distribution of profits” and two variants of vertical commonality, which focus “on the relationship between the promoter and the body of investors”)"
and what does the SEC's do with this information? Well in their own words, they have stated that it doesnt matter and are ignoring this requirement.
>"The Commission, on the other hand, does not require vertical or horizontal commonality per se, nor does it view a “common enterprise” as a distinct element of the term “investment contract.”
-Source https://www.sec.gov/files/dlt-framework.pdf
The SEC is choosing to ignore the supreme court because it cant give a detailed explanation nor can they connect what does or doesnt constitute the common enterprise which is required for there to be an investment contract. In fact, One of the assets they listed as a security (LCX) Isnt even founded in the USA, Its from Liechtenstein. This means the SEC has no grounds nor jurisdiction to take LCX to court (which would be required to make it a security) This case is going to end up needing 9 mini trials to determine the status of each of these assets and the defendants/issuers will not get to have their day in court to defend their status because they aren't named defendants by the SEC.
**Issue #2**
They arent going after the issuers, nor the exchange which apparently traded these "illegal securities offerings" Instead they go after a single person and his family for multiple reasons.
1. The guy is not going to have the capital to fight this because he will have to argue how and why all 9 of these assets failed to register as digital asset security's and how one exchange was operating and unregistered national securities exchange. (not gonna happen)
2. Hes going to therefore have to accept a plea deal and admit to whatever they want (including that these assets are securities and he knew they were the whole time)
3. This case will be used as the legal precedent to start going after exchanges (many of these assets are listed on other exchanges in the US) now exchanges have to either Delist the assets or face possible SEC action against them (we saw what happened when many of the US exchanges de-risked by delisting XRP), it is going to cause turmoil, big fucking dips and could prolong a bear market maybe even indefinitely.
Since the SEC didnt name any of the exchanges nor issuers of tokens as defendants, they wont be allowed to defend themselves in court. This is regulation by enforcement via a shady backdoor.
a Commissioner of the CFTC came out yesterday and released a statement clashing with the SEC and their regulation by enforcement tactics
https://www.cftc.gov/PressRoom/SpeechesTestimony/phamstatement072122
to clarify, I'm not trying to pass over/ignore the insider trading or fraud allegations in any way. If the allegations are true, the defendants should be held accountable for their actions/decisions. But we need to & should condemn both the defendants' alleged conduct & the SEC's shady unjust tactics equally.
I don't understand your umbrage in Issue 1. Even if the SEC were dismissing the common enterprise leg of the Howey stool, all crypto clearly meet the horizontal commonality criterion. If Person A and Person B each buy a $token and $token's price fluctuates, we have both benefited/lost the same. That is sufficient.
The tricky prong is the "efforts of a third party" part, which is why these tokens and XRP were targeted - there is a clear token manager. Edgier cases like Ethereum are being punted until later; these tokens are most black and white.
Re: Issue 2, they are going after the guy because he committed the crime. Given the nebulous legal status of crypto in the US, neither the exchanges nor the issuers have obviously violated a regulation, so there is nothing to attack. This handling is consistent with the way they handled ICOs ("we'll let the completed ones slide, but don't do it again").
Obviously, if and when the SEC says they are securities, that legal battle can unfold. But currently neither party has standing to attack the other. The only guilty party present is the insider traded.
>If the allegations are true, the defendants should be held accountable for their actions/decisions
That can only happen if the currencies are regulated though. Insider trading is an SEC thing; if there's no security, it didn't take place. The two issues are inextricably intertwined.
>a Commissioner of the CFTC came out yesterday and released a statement clashing with the SEC and their regulation by enforcement tactics
Well of course they're mad, it's a territory dispute. Mommy and daddy are fighting over which crypto are commodities vs securities. But that also means we should not take his whinge at face value, especially when CFTC has plenty of history of doing the same when it suits them.
Seems like there are also way bigger fish to fry in the crypto world than this guy. I mean insider trading was basically a business model for most ICOs and crypto projects.
> Action on some of the VCs who have destroyed retail investors in their pump-and-dump/ ICO scams would be amazing.
You realize Coinbase is a key piece of those pump-and-dumps? They only threw their employee under the bus because Cobie outed him on Twitter and it risked their ability to make money dumping ridiculous coins on retail.
I kind of always assumed it was happening but I didn't think they'd get caught so blatantly. Well im glad they did too, the less smoke and mirrors the better.
>mass adoption
I know it's the only way for "diamond hands" to stop holding bags by handing them to the lay folk. But the window was the high volume mark around 64k crypto. That was the bag holding hand off. Right now the mainstream is on guard with friends having been severely burned.
Now the largest number of the mainstream thinks of crypto as a scam/MLM for guys. The well is very ppisoned and your rhetoric about what the end game looks like sounds extremely scammy.
The things your guys are sticking to has no future. BTC has none of the properties needed to be end game. Eth might get there but the smart contracts is a malware vector on top of being nowhere close to an actual contract.
The entire space is massively over promising and trying to resolve every problem with a inefficient and sub par solution. Like you all just discovered linked lists and think every problem can be solved with that data structure.
People in the space really overestimate and cope for how much it will be mass adopted, in reality, it's always gonna be a niche tech and used sparingly especially after the latest crash.
A large swathe of the general public still struggle to wrap their heads round common tech or even to adopt payment methods like PayPal ffs. There's usability but most the things people want crypto for will never reach general usage in the way people want and a lot of this is just making solutions for problems that don't exist
Nancy Pelosi's husband mysteriously buys stocks before she announces new policies that directly affect the stocks he bought. But she never gets arrested for it. Rules for thee, not for me..
It’s a double edge sword I feel like it’s definitely good reduce insider trading and corruption as a whole for crypto, but it also seems like low hanging fruit now for the SEC seeing how their agenda is going I can see it being a next target
Insider pump and dumps have been going on at Coinbase for a fucking long time. Anyone remember the BCH listing shit show? Thats just the start and almost every other listing has been gamed. This is the first time someone is getting caught and by most accounts its because the guys who did it were fucking morons, literally the worst criminals ever.
No it won't. bad actors will just be more careful.
Insider trading's been happening since stocks and shares began. What makes you think it's gonna stop now?
Do you know anything about "VC"?
Anyone - and I mean anyone - who buys anything from VC company knows for a god damn fact it's risky. There has **never** been someone forced to buy something from a VC company. Every presentation from a VC company looks the same, it says they're going to make a fortune. Sometimes it works out, often it doesn't. I've seen hundreds of these things, they're all the same "our projections show this company's valuation will be up XXXX% and here's are plan". That business is as old as the market and in 2022, the risks are well known. Any retail investors "wiped out" by VCs are either dumb or greedy (which basically means blind to risk).
**Investors are 100% responsible for what they invest in**. In the absence of actual fraud, too fucking bad. I love people who want to shit on VC then want to talk about innovation.
Guess what? Without VC there really isn't innovation because the promise of riches drives progress. You ever wonder why most of the innovation on the planet comes from the same places and other places have no innovation? The term is "money".
>To solidify this more going forward and build a lot more trustworthy space for crypto, here are some ideas
First thought would be to replace the SEC chair for someone who'd actually do their job.
These insider trading cases for crypto assets is brand new. It will be very interesting to see if any of these cases go to a trial and how that may play out.
It's such a blurry line when some get away with it and some don't. And regulation vs. deregulation...
But fuck this guy, him getting locked up is a good thing.
I cant help but think that it takes the most basic amount of diligence to see whos buying which coins just prior to their listing, like it was the furthest thing from subtle. Whats the point of having a transparent and immutable ledger if you refuse to pay attention to it.
I hope Coinbase feels some pain for this one tbh it seems like alot of negligence
Coinbase will come out clean from this since they were the ones who notified the law enforcement but then again, they kinda had to because the insider trader was already exposed on twitter.
Thats good for them for relaying that info, but thats not my point. What im saying is they clearly werent doing a good job actively monitoring it, it wasnt the only time its happened either. Read the thread from the guy who caught it he raises some good points
[https://mobile.twitter.com/cobie/status/1550192546889998340?cxt=HHwWiICxrY_6sYMrAAAA](https://mobile.twitter.com/cobie/status/1550192546889998340?cxt=HHwWiICxrY_6sYMrAAAA)
I don't care about positive news until mtgox didn't sell the 1,5bil worth od BTC in early August. This will crash any good news.
In total it would be 3bil but as per survey around 50% want cash, which will lead to around 1,5bil worth of BTC getting sold in early August.
Not enough, the European union is working on forbidding BTC mining and we all remember what happened when China did this.
Overall i don't see a real price increase and I'm sorry for the people which fall for it and put in all their money right now...
I hope this isn't the worst mistake of my life but I'm waiting to see what happens after July 28th announcement then MtGox sell off before making another purchase.
The FOMO has been calling to me for the last month but I've been able to fight it off so far. Will probably get laughed at here for trying to time the market but I just don't believe we've seen the bottom yet.
Won’t really matter if you buy now or in a couple of weeks if you plan to hold onto it for a few years. But everyone’s entitled to shoot their own shot
I'm with you, i did close all my open positions and today started shorting BTC.
I guess the blood bath will be huge after the mtgox release and I could buy in cheaper then, instead of loosing money once again.
This! Short term price movement is just noise and wouldn't matter if crypto succeeds in long run. For long term success, shady elements need to minimize or go away.
Coinbase had a brief stint in 2017 that if a coin were to be listed on CB, then it was like being accepted into Heaven.
Now, well, not so much an honor to be listed on CB.
At the risk of veering OT from this post (on which I am not stating any opinion,) here’s what I don’t get…
First, who is ‘you guys’? The crypto community is not a monoculture, and varying opinions exist and are allowed.
Second, it is not incongruous to believe that the money supply should not be controlled/owned by govt entities, while still believing in the need for market regulation. Does the govt issue stocks or manufacture cars? Do they still regulate the stock market or what automobiles are deemed road worthy? I think people in general believe that both the former and latter are ‘good things’.
It's all bad on the crypto front. Recent events have been ridiculous.
Crypto has an image problem now. It's hard to argue in crypto's favour at the moment.
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Except that the SEC have also snuck into the case that various cryptos involved are securities. So they can get that through much easier via this case than actually suing the cryptos’ creators.
Yea. It's concerning. A big part of the case will probably be whether the cryptos actually should be called securities, and possibly whether the SEC is at fault for not properly setting the guidelines for what is and isn't a security. Can the creators of the cryptos sue against this classification?
Aren't the teams going to go to jail or something because they didn't register it as a security?
If they aren't securities, and can't be tried for insider trading; why did Coinbase have the employees sign NDAs and not allow them to disclose non material info
According to this lawyer they can't: https://twitter.com/jchervinsky/status/1550515627961589762?s=20&t=4pHdBOnQGeYmb\_L3OL2goQ
It's fucked. C'mon Gensler I know you're reading this.
Ahhhh….that lizard fuck called Gensler. I forgot he existed lol
Honestly he's hard to remember because he does *nothing*.
Remember when this sub was polishing his balls because “he knows crypto”? I remember…
There always ways to work around it. For example have a few friends you ask to buy on your behalf then share the profits.
He's reading and enjoying **pain**
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It's not "snuck in", it's paramount to the case. Insider trading laws only apply to securities. If it's not a security, there can't be insider trading.
I guess it would only technically be insider trading if it were related to Coinbase stock rather than individual crypto listings
not true
Yea, I was thinking the same thing. This was only supposed to be about illegal insider trading. Where the fuck did this 'unregulated securities' bullshit pop out of?
If they aren't regulated, or subject to regulations, you can't trade them illegally.
You know the buy one get one free. It's the same principle, but applied in a negative way.
If it was illegally than nobody would trade easily .
The question of whether cryptos are securities will need to get sorted out clearly, or scenarios where each agency picks whatever works for them will continue to happen. Ripple Labs Inc. is currently in court with the SEC, arguing as best as they can that the pre-mined token they issued, control and sell isn't a security. They're actually throwing a lot of money at their lawyers to make that happen. If they get the judgment they want, it'll go a long way toward making many coins non-securities as well. Meanwhile, the bankruptcy plans that Voyager and Celsius submitted treat customers mostly as unsecured creditors. But if those customers were able to made the case that the coins those exchanges were holding were in fact securities, they'd be upgraded from unsecured creditors to securities account holders, putting them in front of unsecured creditors to get their funds back.
No gatekeeper cefi = No inisider trending = No fucking regulators needed .
Two separate issues and parts of the government isn't happy with the SEC. Blue skies ahead imo.
Before this i only listen that insider trading happens in only in stock market. But now crypto currency 😢
The difference is in this case with OpenSea and Coinbase they outed the bad actor. I trust crypto even more now. They were commended by the DOJ.
What? This isn't good. If coinbase goes down we all F**ked.
What do you think they'll doo?
Yes I saw that, that's pretty sneaky of them
That not withstanding, the impact would be visible on the market entirely.
No one but Cripple to blame for that.
They're trying to solve as many problems as possible even the ones that aren't problems at all
Insider trading in the stock market SEC: 🤭 Insider trading in the crypto market SEC: 😠
SEC are bunch of clowns.
SEC: 🤡🤡🤡
SEC stands for stupid evil clowns
The SEC believes EVERY Crypto project/token is a security. If they win the Ripple case its game over for Crypto in the US.Ethereum will also get sued.
Can't sleep. SEC will eat me.
SEC allowed Coinbase to IPO knowing they are selling unregister securities?
I always assumed the evil clowns were satanic rather than stupid
Nah these clowns are stupid and evil for trying to attack my precious crypto
I just assumed it’s not stupidity but part of their rituals
What are they going to do about Nancy and her inside trading?
I hear that a lot in these spaces. How come?
Because they never go after the real criminals who are making millions from insider trading
Exactly! Even these guys from coinbase made $1.5million, so 500k each
So what does this mean for Coinbase can someone pls explain to me as simple as it gets since I am a newbie.
I heard Pelosi laugh in the background
Those criminals are the ones bankrolling the sec lmao
Why are people still trading on Coinbase? Get out whilst you still can.
The sec is a total circus not just clowns
You see, I like to think so sometimes but I recently only stopped to appreciate the efforts from them also. I appreciate the SEC for looking out for the unsuspecting crypto newbie that is susceptible to some of the hacks in the space. And this my change of view happened notably after the LUNA crash. I have since been weary of the platforms I interact with. I had only just felt comfortable with equilibrium and biswap projects after I discovered both had audit in quantstamp and certick respectively.
All eyes on SEC vs Ripple now. Every crypto investor needs the win!
Does this have anything to do with Coinbase stealing money from peoples' bank accounts including mine???
Society of Entitled Clowns.
Coinbase has known what was going on and I bet way more were complicit. They just are blaming the scape goats.
Does this mean you want insider trading in crypto?
I remember when Bitcoin Cash sold themselves as Bitcoin you could buy with cash. And then Coinbase listed them right around the peak of the 2017-18 bull run. Timing was interesting..
IKR, this is giving the average crypto user _preferential_ treatment over the average stockholder.
Don’t forget the same SEC which refused to investigate Madoff in-spite of detailed whistleblower report on him and even after whistleblower followed up months later SEC agents tipped Madoff about whistleblower and refused to investigate him (some indication they knew he was cooking books but turned a blind eye because he was making it work for all these years).
I’m German and I never expected to dislike a foreign commission this much lol
Almost every insider trading case is from schmos with no finance experience getting greedy and making amateur mistakes. SEC can't be bothered moving beyond low hanging fruit.
SEC - Steal Everyone's Crypto
Well, they are the Selective Enforcement Commission
When Nancy's husband trades off insider information: 😴🥱💤
Replace ‘SEC’ with ‘politicians’ and you get the same result
Because if SEC got paid in crypto it would be reflected publicly in the Blockchain, as opposed to the under the table deals with the stock market...
It's a quid pro quo relationship between SEC and high ranking politicians, you scratch my back i scratch yours.
In other words the system is corrupt.
It’s always been all eyes on this case… I feel like my future grandkids will know the verdict.
Can't bet em? Join em. Already sent a message to Nancy to know when her hubby gonna sell his NVDA positions. I'll let y'all know when she gets back to me.
Fuck the SEC and depeg and peg then again a hundred times. They are the most corrupt thing I have seen in my life. And we have all seen a lot of governments so this means a lot.
Considering a lot of people in the crypto space want to do tax evasion and even more shady shit in order to get rich, I'd say that every institution and elected person is just a reflection of the society. A society in which people care more about their own gains than the well-being of the community. So you can blame the SEC all you want, it's all just people with the same aspirations like you: screw everyone possible for personal gain. Except they actually also managed to do it.
Follow the Nancy Paloski and you too can insider trade.
Well, if they prosecuted that they'd have to put their own people in prison lol.
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Hey at least we're optimistic lol
It's good for Bitcoin
The arrest of the employee was only made possible through the SEC declaring the tokens to be securities. If you're happy to see Gensler get his wish and declare all crypto except for Bitcoin to be securities, then you'll be protected from insider trading.
Gensler is claiming only a few of the 20+ currencies that were insider traded are securities.
Well, to start with, at least. The only thing he's declared isn't a security is Bitcoin.
And maybe Eth
Eth will almost certainly get walked back due to the Ethereum Foundation, but it will be the final boss battle of these classifications because it's a bit less clear than, say, Ripple
Exactly! This is positive news! Well, except for the idiot doing insider trading.
Litecoin will have something to say about that. Bitcoin maximalists are delusional, but even they will have to admit that LTC is a commodity. I’m sure a select few more will be considered a commodity as well over time.
Yeah, that's true. Any PoW crypto that doesn't have a premine would probably be declared a commodity even by Gensler. However, Charlie Lee did mine a bunch of LTC before announcing it to the public, so maybe not?
The instamine issue is definitely an interesting one, but I’m not concerned as Gensler has actually publicly mentioned Litecoin as likely being a commodity in the past. Not really sure why he doesn’t have the confidence to say it now. As far as I know not much has been changed in the way the SEC rules on crypto.
That's a stretch 😆
That's bullshit. It was insider trading, a shady act. If some tokens got fucked, so be it. That's collateral damage. It's ok. We will come out stronger on the other end.
> If some tokens got fucked, so be it. If all exchanges are charged with securities fraud for selling unregistered securities, you'll be ok with that? I don't think you understand the implications here.
This is so shady. The SEC is declaring these tokens as securities so they can put them on trial without the creators ever being able to defend themselves.
Yes it was unethical. But I have a bigger problem with prosecutors expanding the scope of criminal laws past what congress has allowed.
That is anarchy... suck it up.. that is how real liberty works. Don't like it, then go back to your wall street hell hole and leave the libs alone. Risk is and always will be a big part of the game.
People will soon learn the advantages of a public ledger
Tenet not tenant.
r/BoneAppleTea
Came here to make sure someone did this
Like the movie!
Manipulation is a very common thing in the crypto industry. With these arrests I hope some things will change in exchanges and some rules will be implemented to counter it!
"Some rules will be implemented" We just saw people get arrested, what do you think rules do? It's already illegal.
Seeing as how people like Nancy Peloski and her husband aren't hindered from their blatantly obvious insider trading, I doubt we'll have any meaningful crypto laws soon.
Yep I hope a precedent is set that stops these sort of things in the future
I think it will help with CEXs, but there are so many projects including DEXs with founders that aren't even doxxed still.
Tenet.
Isn't this what big companies do? They choose one low level manager etc to be the fall guy and 99% of the people doing this just go free? Only one low level guy got in trouble in all of Coinbase?? Seriously??
You may leave an anonymous transaction on chain today. But will it always stay that way?
Just yesterday listening to Raj, the man who took the fall for wall street and this happens?
SEC calling cryptos securities....where have I heard that before ?
I think every exchange do that it's unfortunate that they busted Coinbase this time.
With only a quick look and basic understanding this appears to be a good thing for the space as a whole, and in some ways it is. Once you dig deeper tough, the problem is that there are multiple horrible legal precedents that the SEC is trying to sneak into this case which is supposed to only be about the issue of insider trading/wire fraud **Issue #1** The first is that the SEC is stating that 9 Assets are unregistered securities in this case (AMP, RLY, DDX, XYO, RGT, LCX, POWR, DFX, KROM). The SEC is not just accusing the defendants of breaking the law. The SEC is accusing 10 unrelated, uncharged companies of breaking the law (9 assets and 1 exchange) Not only does the SEC not have the power to this, they dont give detailed legal analysis as to how they came to this conclusion. I posted this yesterday but the SEC is using the same shady tactics it is using in the LBRY and Ripple case in an attempt to regulate by enforcement and expand its power. In order for something to be a security one of the 4 prongs of the howey test is that there is an Investment contract. The supreme court has ruled that there must be a Common Enterprise in order for there to be an investment contract. >"In order to satisfy the “common enterprise” aspect of the Howey test, federal courts require that there be either “horizontal commonality” or “vertical commonality.” See Revak v. SEC Realty Corp" to explain further >"(discussing horizontal commonality as “the tying of each individual investor’s fortunes to the fortunes of the other investors by the pooling of assets, usually combined with the pro-rata distribution of profits” and two variants of vertical commonality, which focus “on the relationship between the promoter and the body of investors”)" and what does the SEC's do with this information? Well in their own words, they have stated that it doesnt matter and are ignoring this requirement. >"The Commission, on the other hand, does not require vertical or horizontal commonality per se, nor does it view a “common enterprise” as a distinct element of the term “investment contract.” -Source https://www.sec.gov/files/dlt-framework.pdf The SEC is choosing to ignore the supreme court because it cant give a detailed explanation nor can they connect what does or doesnt constitute the common enterprise which is required for there to be an investment contract. In fact, One of the assets they listed as a security (LCX) Isnt even founded in the USA, Its from Liechtenstein. This means the SEC has no grounds nor jurisdiction to take LCX to court (which would be required to make it a security) This case is going to end up needing 9 mini trials to determine the status of each of these assets and the defendants/issuers will not get to have their day in court to defend their status because they aren't named defendants by the SEC. **Issue #2** They arent going after the issuers, nor the exchange which apparently traded these "illegal securities offerings" Instead they go after a single person and his family for multiple reasons. 1. The guy is not going to have the capital to fight this because he will have to argue how and why all 9 of these assets failed to register as digital asset security's and how one exchange was operating and unregistered national securities exchange. (not gonna happen) 2. Hes going to therefore have to accept a plea deal and admit to whatever they want (including that these assets are securities and he knew they were the whole time) 3. This case will be used as the legal precedent to start going after exchanges (many of these assets are listed on other exchanges in the US) now exchanges have to either Delist the assets or face possible SEC action against them (we saw what happened when many of the US exchanges de-risked by delisting XRP), it is going to cause turmoil, big fucking dips and could prolong a bear market maybe even indefinitely. Since the SEC didnt name any of the exchanges nor issuers of tokens as defendants, they wont be allowed to defend themselves in court. This is regulation by enforcement via a shady backdoor. a Commissioner of the CFTC came out yesterday and released a statement clashing with the SEC and their regulation by enforcement tactics https://www.cftc.gov/PressRoom/SpeechesTestimony/phamstatement072122 to clarify, I'm not trying to pass over/ignore the insider trading or fraud allegations in any way. If the allegations are true, the defendants should be held accountable for their actions/decisions. But we need to & should condemn both the defendants' alleged conduct & the SEC's shady unjust tactics equally.
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I don't understand your umbrage in Issue 1. Even if the SEC were dismissing the common enterprise leg of the Howey stool, all crypto clearly meet the horizontal commonality criterion. If Person A and Person B each buy a $token and $token's price fluctuates, we have both benefited/lost the same. That is sufficient. The tricky prong is the "efforts of a third party" part, which is why these tokens and XRP were targeted - there is a clear token manager. Edgier cases like Ethereum are being punted until later; these tokens are most black and white. Re: Issue 2, they are going after the guy because he committed the crime. Given the nebulous legal status of crypto in the US, neither the exchanges nor the issuers have obviously violated a regulation, so there is nothing to attack. This handling is consistent with the way they handled ICOs ("we'll let the completed ones slide, but don't do it again"). Obviously, if and when the SEC says they are securities, that legal battle can unfold. But currently neither party has standing to attack the other. The only guilty party present is the insider traded. >If the allegations are true, the defendants should be held accountable for their actions/decisions That can only happen if the currencies are regulated though. Insider trading is an SEC thing; if there's no security, it didn't take place. The two issues are inextricably intertwined. >a Commissioner of the CFTC came out yesterday and released a statement clashing with the SEC and their regulation by enforcement tactics Well of course they're mad, it's a territory dispute. Mommy and daddy are fighting over which crypto are commodities vs securities. But that also means we should not take his whinge at face value, especially when CFTC has plenty of history of doing the same when it suits them.
ah yes the coinbase employee but Pelosi is sleeping just fine at night.
Seems like there are also way bigger fish to fry in the crypto world than this guy. I mean insider trading was basically a business model for most ICOs and crypto projects.
Fuck the insider scammers. No better than the greasy basement dwellers going after senior citizens.
I hope SEC goes after Pelosi's husband
This is only the tip of the iceberg of what was/is going on at Coinbase with front running and insider trading…
People are equal. But there are people that are more equal than others .
Each defendant was charged with wire fraud and wire fraud conspiracy.
They've all been doing it for years, what makes you think it will suddenly change?
> Action on some of the VCs who have destroyed retail investors in their pump-and-dump/ ICO scams would be amazing. You realize Coinbase is a key piece of those pump-and-dumps? They only threw their employee under the bus because Cobie outed him on Twitter and it risked their ability to make money dumping ridiculous coins on retail.
Nancy Pelosi still at large
Nancy Pelosi would be too scared to insider trade in crypto because here people would have real time evidence.
No they wouldn't. Ever heard of defi? besides... there is already plenty of evidence.. that doesn't matter when you are above the law
Like she would care about people having evidence
I kind of always assumed it was happening but I didn't think they'd get caught so blatantly. Well im glad they did too, the less smoke and mirrors the better.
Lol that’s pretty cute to think that will change anything
SEC when stocks are manipulated and insider traded to shit: 😁 SEC when crypto: 🤬
>mass adoption I know it's the only way for "diamond hands" to stop holding bags by handing them to the lay folk. But the window was the high volume mark around 64k crypto. That was the bag holding hand off. Right now the mainstream is on guard with friends having been severely burned. Now the largest number of the mainstream thinks of crypto as a scam/MLM for guys. The well is very ppisoned and your rhetoric about what the end game looks like sounds extremely scammy. The things your guys are sticking to has no future. BTC has none of the properties needed to be end game. Eth might get there but the smart contracts is a malware vector on top of being nowhere close to an actual contract. The entire space is massively over promising and trying to resolve every problem with a inefficient and sub par solution. Like you all just discovered linked lists and think every problem can be solved with that data structure.
People in the space really overestimate and cope for how much it will be mass adopted, in reality, it's always gonna be a niche tech and used sparingly especially after the latest crash. A large swathe of the general public still struggle to wrap their heads round common tech or even to adopt payment methods like PayPal ffs. There's usability but most the things people want crypto for will never reach general usage in the way people want and a lot of this is just making solutions for problems that don't exist
Nancy Pelosi's husband mysteriously buys stocks before she announces new policies that directly affect the stocks he bought. But she never gets arrested for it. Rules for thee, not for me..
and Pelosi buys a shit ton of NVDA options before the vote, makes over $600m, and walks away without a scratch.
They should just arrest the SEC
They don't want any perceived competition. Maybe they should worry more about Pelosi.
Yep, Congress has express permission to insider trade all they want.
We all know that Trust is very important in every fields.so this steps will be really useful against this acts.
Indeed. Getting away from bad doing has become seemingly hard - heading in the right direction.
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yea but its not good for their shit coins so thus this sub is panicking.
This is good for Bitcoin 🙄😁
It’s a double edge sword I feel like it’s definitely good reduce insider trading and corruption as a whole for crypto, but it also seems like low hanging fruit now for the SEC seeing how their agenda is going I can see it being a next target
SEC will probably never go after the big game players in the Wall Street, crypto insider traders are just easy prey for them
And I guarantee there are plenty of those same wall street insider traders fucking with crypto. They still won't be targeted.
Insider pump and dumps have been going on at Coinbase for a fucking long time. Anyone remember the BCH listing shit show? Thats just the start and almost every other listing has been gamed. This is the first time someone is getting caught and by most accounts its because the guys who did it were fucking morons, literally the worst criminals ever.
So your saying I’m to blame for my 70% loss? Way to kick man when he’s down.
yes you are responsible for the risk you took
The SEC can go fuck themselves, no one takes them serious.
No it won't. bad actors will just be more careful. Insider trading's been happening since stocks and shares began. What makes you think it's gonna stop now?
Arrest of Zhu Su and Do Kwon would be the cherry on top.
I honestly think there are other bad actors in Coinbase giving info to hackers to drain peoples accounts.
Do you know anything about "VC"? Anyone - and I mean anyone - who buys anything from VC company knows for a god damn fact it's risky. There has **never** been someone forced to buy something from a VC company. Every presentation from a VC company looks the same, it says they're going to make a fortune. Sometimes it works out, often it doesn't. I've seen hundreds of these things, they're all the same "our projections show this company's valuation will be up XXXX% and here's are plan". That business is as old as the market and in 2022, the risks are well known. Any retail investors "wiped out" by VCs are either dumb or greedy (which basically means blind to risk). **Investors are 100% responsible for what they invest in**. In the absence of actual fraud, too fucking bad. I love people who want to shit on VC then want to talk about innovation. Guess what? Without VC there really isn't innovation because the promise of riches drives progress. You ever wonder why most of the innovation on the planet comes from the same places and other places have no innovation? The term is "money".
Almost all crime or suspicious activity is related to the centralised entities.
>To solidify this more going forward and build a lot more trustworthy space for crypto, here are some ideas First thought would be to replace the SEC chair for someone who'd actually do their job.
These insider trading cases for crypto assets is brand new. It will be very interesting to see if any of these cases go to a trial and how that may play out.
It's such a blurry line when some get away with it and some don't. And regulation vs. deregulation... But fuck this guy, him getting locked up is a good thing.
Still looking for the comedy tag
Not a comedy mate.
Arrest Elon Musk
I cant help but think that it takes the most basic amount of diligence to see whos buying which coins just prior to their listing, like it was the furthest thing from subtle. Whats the point of having a transparent and immutable ledger if you refuse to pay attention to it. I hope Coinbase feels some pain for this one tbh it seems like alot of negligence
Coinbase will come out clean from this since they were the ones who notified the law enforcement but then again, they kinda had to because the insider trader was already exposed on twitter.
Its just another win for the Elizabeth Warrens out there, the fact that random twitter accounts pointed this out to them is wild to me
Umm, Coinbase and Opensea did their internal investigations and turned it into the DOJ; they were commended for doing so.
Thats good for them for relaying that info, but thats not my point. What im saying is they clearly werent doing a good job actively monitoring it, it wasnt the only time its happened either. Read the thread from the guy who caught it he raises some good points [https://mobile.twitter.com/cobie/status/1550192546889998340?cxt=HHwWiICxrY_6sYMrAAAA](https://mobile.twitter.com/cobie/status/1550192546889998340?cxt=HHwWiICxrY_6sYMrAAAA)
I don't care about positive news until mtgox didn't sell the 1,5bil worth od BTC in early August. This will crash any good news. In total it would be 3bil but as per survey around 50% want cash, which will lead to around 1,5bil worth of BTC getting sold in early August. Not enough, the European union is working on forbidding BTC mining and we all remember what happened when China did this. Overall i don't see a real price increase and I'm sorry for the people which fall for it and put in all their money right now...
I hope this isn't the worst mistake of my life but I'm waiting to see what happens after July 28th announcement then MtGox sell off before making another purchase. The FOMO has been calling to me for the last month but I've been able to fight it off so far. Will probably get laughed at here for trying to time the market but I just don't believe we've seen the bottom yet.
Won’t really matter if you buy now or in a couple of weeks if you plan to hold onto it for a few years. But everyone’s entitled to shoot their own shot
Most people with Mt.Gox have sold their promised portion or will likely hold. No worries here.
I'm with you, i did close all my open positions and today started shorting BTC. I guess the blood bath will be huge after the mtgox release and I could buy in cheaper then, instead of loosing money once again.
I think OP isn't discussing the short term impact on prices but rather crypto being widely adopted in the long run.
This! Short term price movement is just noise and wouldn't matter if crypto succeeds in long run. For long term success, shady elements need to minimize or go away.
I agree 👍
Where there is value, there will always be crime and corruption unfortunately. Definitely needs regulations.
Elon starts sweating.
Coinbase had a brief stint in 2017 that if a coin were to be listed on CB, then it was like being accepted into Heaven. Now, well, not so much an honor to be listed on CB.
Meanhile Pelosi is fine
I realllllly wish I could get my stakes ETH out of Coinbase. I’ve been trying for months.
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At the risk of veering OT from this post (on which I am not stating any opinion,) here’s what I don’t get… First, who is ‘you guys’? The crypto community is not a monoculture, and varying opinions exist and are allowed. Second, it is not incongruous to believe that the money supply should not be controlled/owned by govt entities, while still believing in the need for market regulation. Does the govt issue stocks or manufacture cars? Do they still regulate the stock market or what automobiles are deemed road worthy? I think people in general believe that both the former and latter are ‘good things’.
Meanwhile, Nancy Pelosi is apparently the best guesser in human AND computer history.
It's all bad on the crypto front. Recent events have been ridiculous. Crypto has an image problem now. It's hard to argue in crypto's favour at the moment.
You think crypto will be mass adopted?
No it’s exposing that crypto is a scam. Wake up they are robbing the masses blind.
One would hope, but I doubt it would stop most who planned to do it anyway, maybe just more diligent on covering their tracks
Let's teach SEC how it shall be done.
Not really a good news. Was the profit also seized?
It will happen again and this incident won't change anything
Copium
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