Coinbase Sues the SEC(theblock.co) |
Coinbase Sues the SEC(theblock.co) |
Key quote:
Coinbase brings this mandamus action to seek modest, but meaningful and time-sensitive, relief: a writ requiring the Securities and Exchange Commission (SEC or Commission) to act on Coinbase’s pending rulemaking petition to provide clarity for the crypto industry. Coinbase does not ask the Court to instruct the agency how to respond. It simply requests that the Court order the SEC to respond at all. The Commission has repeatedly demonstrated that its mind is made up to deny the petition. But the Commission’s delay in formally announcing that decision has enabled it to improperly delay judicial review at a critical moment for the industry.
(As an aside, I consider it journalistic malpractice to publish a news story about a court filing without including a link to the filing itself.)
Likewise for legislation and for scientic research (when its open access). It can just be a footnote, if they're worried about sending the reader off down a rabbit hole.
This whole thing has been silly, coinbase has been making this disingenuous argument for years now that they want "regulatory clarity" around crypto, but when that clarity turns out to be "We already have rules maybe you should follow them" they act all surprised. At the end of the day it's very simple, crypto that complies with the law isn't really a thing anyone needs.
It's not “identical”, just as trading coconuts for pearls is not the same with options trading, executed by an OTC dark pool in the US market.
Also, the regulator doesn't agree with you : Gensler refuses to say if ETH is a security or not. Following your line of thought this should be a no-brainer. Maybe there's a political reason behind this unprofessional behavior from the American regulator?
Anyway, crypto leaving the US is a net positive for the world, as it will further free itself from imperialistic domination.
Yes, it's great that Bitcoin will move away from free and open democracies to banana republics and despotic regimes- the true bastions of freedom.
[Some speculate the reason is the FTX debacle, and the political donations of its founder, and the politicos wanting to be seen "taking care of that crypto problem"].
oof, so...is Ether a security?
Is this tweet an exchange? https://twitter.com/hoffmang/status/1515797969802436608
The CFTC is not happy with Gensler’s blatant power grab either https://www.cftc.gov/PressRoom/SpeechesTestimony/phamstateme...
Also, Bitcoin was made to be an alternative to cash, not an alternative to banks. So it can be discussed that KYC/AML should apply.
It's a similar accusation that I've heard lobbed against the executive branch in recent years: announce a forthcoming executive order, which would be plainly unlawful and ripe for a court to halt but then don't actually formally issue the order -- denying anyone standing to bring action over it. This achieves the intended, unlawful, effect via parties that comply out of ignorance, in preparation, or out of fear that it might suddenly take effect and leave them in the wrong.
I haven't looked into the details -- and don't even know if enough are available-- to figure out if this position is well founded.
Putting aside the due process angle, there is also a parity consideration. The market benefits from clear, enforced rules because absent them the parties most willing to violate the rules while pretending to comply have a competitive advantage. The more clear and the better enforced the rule is, the more level the playing field. It may well be better for coinbase to end up with a decision which significantly restricts their business so long as its clear enough to have the effect of restricting their competition as well -- while it's in the grey competitors with less to lose will be in a better position.
Though only on a fraction of parties, right?
The remaining folks would ask a much higher price in exchange for the increased risk, but they would remain.
https://www.forbes.com/sites/digital-assets/2023/04/19/i-dis...
https://www.sec.gov/news/statement/peirce-statement-kraken-0...
https://www.sec.gov/news/statement/peirce-rendering-inovatio...
You're being disingenuous by saying "the SEC is totally clear!", when in fact, they can't even give a straight answer as to whether ETH (top 3 crypto and probably most used for development) is a security.
It feels a lot like "We perform illegal searches against pedestrians that look poor, because we know they can't sue to defend their rights." -- impacts only a portion of the public! The law should be the law for everyone, the fact that it applies so some more than others is not generally a virtue. Sure less people hit by an unlawful rule is better, but NO people should be subject to unlawful rules.
More specifically for cryptocurrency there are bad selection effects: Alice and Bob each consider running an exchange. Bob is careful, realizes the law is unclear and departs the space. Alice is a cowboy and rushes in, does a much worse job than Bob would have done.
Worse, Alice may realize that uncomfortable litigation is for sure in her future no matter what she does in the space (except exiting entirely) and so she decides that she should scam big or go home: if she takes in billions from the public on a bunch of baseless hype she can pay a 2% settlement to the SEC to get free of it. ... or she can be conservative, raise a tiny amount and get ruined by any SEC action yet save countless people from a dubious investment.
Unclear rules and unequal enforcement is like taking only half the bottle of antibiotics, it breeds superbugs and still poisons the helpful bacteria.