Well plain ordinary money gets lost until only a few left in collectors coin albums
Bitcoin seems to spell the death of plain ordinary money coin collecting
cryptocurrencies
- Thread starter mathman
- Start date
Bitcoin seems to spell the death of plain ordinary money coin collecting
Seattle
Valued Senior Member
?Well plain ordinary money gets lost until only a few left in collectors coin albums
Bitcoin seems to spell the death of plain ordinary money coin collecting
Stable Genius, Crypto Edition
The ingenuity of cryptocurrency continues its struggle to adapt to reality:
According to the Coindesk article, Core Scientific accounts for 8.6% of the global BTC hashrate. Core's third-quarter report, filed this week, suggests it could run out of cash before the year is out, and observes, "it is very difficult to predict when or if bitcoin prices will recover or energy costs will abate" (qtd. in Gkritsi). While capitalistic notions drive the cryptocurrency market, it is another side of modern capitalism presently setting in:
Bitcoin is off today, down YTD, has fallen over 70% since last year, and nearly three quarters since it peaked thirteen months ago.
The next quarter, at least, looks a little rough for cryptocurrency in general and BTC specifically; it's hard to see how energy costs recover at least before the end of the war, and it seems uncertain where rescue capital is going to come from. The Bitcoin mining sector prospect is strange; if we add in Iris, now in default, over ten percent of global BTC hashrate is struggling financially. With Argo and Greenridge struggling, as well, that number creeps toward fifteen percent. Looking forward, the next year seems fraught with uncertainty.
The flip-side, of course, is that cryptocurrency in general might be, as a concept, too big to fail compared to how much whoever invested. But if history might look back at a mining rush, our present moment might wonder at a post-rush future. The thing about not being like gold, though, is that we are not precluded from a future mining boom.
____________________
Notes:
Gkritsi, Eliza. "Bitcoin Mining Giant Core Scientific Ended October With $32M in Cash". CoinDesk. 22 November 2022. CoinDesk.com. 1 December 2022. https://bit.ly/3H2AuGt
The ingenuity of cryptocurrency continues its struggle to adapt to reality:
Core Scientific (CORZ), the world's largest publicly listed miner by computing power, ended October with $32.2 million in cash and 62 BTC ($975,000) and reiterated that it may run out of money before the end of the year.
The company first warned of bankruptcy risk about a month ago, sending its shares plummeting about 80% on Nasdaq. The miner had 1,051 BTC and $29.5 million in cash at the end of September.
Core Scientific is one of several miners struggling to keep afloat as rising energy prices increase costs, and a stubbornly low bitcoin price slashes revenue. Compute North filed for Chapter 11 bankruptcy in late September, and Iris Energy has received a notice of default on its loans. Argo Blockchain (ARBK) and Greenidge Generation (GREE) have also said they are strapped for cash.
(Gkritsi↱)
The company first warned of bankruptcy risk about a month ago, sending its shares plummeting about 80% on Nasdaq. The miner had 1,051 BTC and $29.5 million in cash at the end of September.
Core Scientific is one of several miners struggling to keep afloat as rising energy prices increase costs, and a stubbornly low bitcoin price slashes revenue. Compute North filed for Chapter 11 bankruptcy in late September, and Iris Energy has received a notice of default on its loans. Argo Blockchain (ARBK) and Greenidge Generation (GREE) have also said they are strapped for cash.
(Gkritsi↱)
According to the Coindesk article, Core Scientific accounts for 8.6% of the global BTC hashrate. Core's third-quarter report, filed this week, suggests it could run out of cash before the year is out, and observes, "it is very difficult to predict when or if bitcoin prices will recover or energy costs will abate" (qtd. in Gkritsi). While capitalistic notions drive the cryptocurrency market, it is another side of modern capitalism presently setting in:
The mining firm is in talks with creditors to restructure its debt and raise capital. One lender, BlockFi, has been caught in the crossfire of crypto exchange FTX's collapse. The exchange had promised to bail out BlockFi with a $400 million credit facility, and that's now not likely to materialize. Core Scientific had about $54 million outstanding to BlockFi as of Sept. 30.
Core Scientific has been affected by the bankruptcy of lender Celsius's mining arm, one of its biggest clients. Celsius Mining filed for Chapter 11 bankruptcy in July, and in September sued Core Scientific claiming that it violated automatic stay terms. Core Scientific claims Celsius owes it $5.2 million as of Sept. 30.
Two other companies sued CORZ in November: Sphere 3D (ANY) and McCarthy Building Companies. A class-action lawsuit was filed in the same month in Texas courts alleging failures to disclose important information to investors.
Core Scientific has been affected by the bankruptcy of lender Celsius's mining arm, one of its biggest clients. Celsius Mining filed for Chapter 11 bankruptcy in July, and in September sued Core Scientific claiming that it violated automatic stay terms. Core Scientific claims Celsius owes it $5.2 million as of Sept. 30.
Two other companies sued CORZ in November: Sphere 3D (ANY) and McCarthy Building Companies. A class-action lawsuit was filed in the same month in Texas courts alleging failures to disclose important information to investors.
Bitcoin is off today, down YTD, has fallen over 70% since last year, and nearly three quarters since it peaked thirteen months ago.
The next quarter, at least, looks a little rough for cryptocurrency in general and BTC specifically; it's hard to see how energy costs recover at least before the end of the war, and it seems uncertain where rescue capital is going to come from. The Bitcoin mining sector prospect is strange; if we add in Iris, now in default, over ten percent of global BTC hashrate is struggling financially. With Argo and Greenridge struggling, as well, that number creeps toward fifteen percent. Looking forward, the next year seems fraught with uncertainty.
The flip-side, of course, is that cryptocurrency in general might be, as a concept, too big to fail compared to how much whoever invested. But if history might look back at a mining rush, our present moment might wonder at a post-rush future. The thing about not being like gold, though, is that we are not precluded from a future mining boom.
____________________
Notes:
Gkritsi, Eliza. "Bitcoin Mining Giant Core Scientific Ended October With $32M in Cash". CoinDesk. 22 November 2022. CoinDesk.com. 1 December 2022. https://bit.ly/3H2AuGt
Obverse, true enough. Reverse: It's not necessarily an appropriate comparison.
Harry Potter and the Whatnow?
Meanwhile, Robert Evans↱ offers some notes on "Rationalist Harry Potter and the Collapse of Crypto", which might be an overstatement, as it pertains particularly to the collapse of FTX:
By comparison, Evans notes, the whole of the Lord of the Rings series clocks in at 580,000 words. Written by Eliezer Yudkowski over the course of several years, Harry Potter and the Methods of Reationality "is so long the audiobook for it clocks in at about 500 hours", according to Evans, which is not entirely accurate; narrator Jack Voraces hopes to make it into a 500-hour audiobook.
Some descriptions, such as Harry being "basically the Jesus Christ of Rational Thought", aren't necessarily accurate: "While Eliezer's Harry Potter is obsessed with rationalist thought experiments and Bayes's Theorem," Evans expalins, "he very rarely solves any problems via logic and intelligence."
In a way, this actually hints after explanations for other things going on in the vicinity of contemporary Rationalism. Evans suggests, "World domination is a background theme that runs through the whole online rationalist community", which would make a certain amount of sense. But that is its own question, for another day.
In our moment, the question is what this has to do with what Caroline Ellison has to do with the FTX collapse. There is a certain easy shrug that goes with saying, "Sounds about right," but there is also an easy facial response that goes, "Oh, come on. FFS, no, no, and no."
____________________
Notes
Evans, Robert. "Rationalist Harry Potter and the Collapse of Crypto". Shatter Zone. 2 December 2022. ShatterZone.Substack.com. 4 December 2022. https://bit.ly/3VEwSyC
Meanwhile, Robert Evans↱ offers some notes on "Rationalist Harry Potter and the Collapse of Crypto", which might be an overstatement, as it pertains particularly to the collapse of FTX:
The short of it is that FTX and Alameda were big gambling platforms, in which nerds in their late 20s with delusions of grandeur bet on what are called "shitcoins" while giving interviews about effective altruism and claiming that all of this was being done in the service of charity.
The way the tech press fell for this is fascinating, but today we're going to look at some of the ideology that helped inspire the greatest disaster in crypto history. And to tell that story, we need to look back at Caroline Ellison, and her obsession with Harry Potter ....
.... A Forbes article, published November 18th, provided more information, claiming Ellison was a "Harry Potterhead", and that her parents first started reading the books to her when she was three years old.
But if Caroline were just obsessed with the normal Harry Potter series, I would not be writing about it.
Her old Tumblr existed under the name "WorldOptimisation". Gawker revealed this for an article in which they also noted she was heavily into fan fiction. Several folks on Twitter pointed out that the phrase "World Optimisation" has its origin in another piece of fan-fiction, an epic re-write of the first Harry Potter book called Harry Potter and the Methods of Rationality.
If you are a normal, decent, well-socialized human being, you probably have not heard about Harry Potter and the Methods of Rationality. Actually explaining what this thing is will have to happen in several different stages. But I should start by telling you this re-write of the first Harry Potter book is around 660,000 words long.
The way the tech press fell for this is fascinating, but today we're going to look at some of the ideology that helped inspire the greatest disaster in crypto history. And to tell that story, we need to look back at Caroline Ellison, and her obsession with Harry Potter ....
.... A Forbes article, published November 18th, provided more information, claiming Ellison was a "Harry Potterhead", and that her parents first started reading the books to her when she was three years old.
But if Caroline were just obsessed with the normal Harry Potter series, I would not be writing about it.
Her old Tumblr existed under the name "WorldOptimisation". Gawker revealed this for an article in which they also noted she was heavily into fan fiction. Several folks on Twitter pointed out that the phrase "World Optimisation" has its origin in another piece of fan-fiction, an epic re-write of the first Harry Potter book called Harry Potter and the Methods of Rationality.
If you are a normal, decent, well-socialized human being, you probably have not heard about Harry Potter and the Methods of Rationality. Actually explaining what this thing is will have to happen in several different stages. But I should start by telling you this re-write of the first Harry Potter book is around 660,000 words long.
By comparison, Evans notes, the whole of the Lord of the Rings series clocks in at 580,000 words. Written by Eliezer Yudkowski over the course of several years, Harry Potter and the Methods of Reationality "is so long the audiobook for it clocks in at about 500 hours", according to Evans, which is not entirely accurate; narrator Jack Voraces hopes to make it into a 500-hour audiobook.
Some descriptions, such as Harry being "basically the Jesus Christ of Rational Thought", aren't necessarily accurate: "While Eliezer's Harry Potter is obsessed with rationalist thought experiments and Bayes's Theorem," Evans expalins, "he very rarely solves any problems via logic and intelligence."
Instead he gets a time-turner (Harry Potter time machine) right away and then uses time travel to solve nearly all of his problems. I have read roughly 100,000 words of this stupid thing, along with a chapter-by-chapter review by an actual scientist. If you're the kind of person who learns useful life lessons from Rational Harry Potter, you're probably multi-billion dollar fraudster Caroline Ellison.
Speaking of which, remember when I said her Tumblr name "WorldOptimization", was a reference to Rational Harry Potter? It comes from this line, spoken Eliezer's 11-year-old protagonist:
"World domination is such an ugly phrase. I prefer to call it world optimization."
Rational Harry Potter spends a mind-numbing portion of the book's total length discussing his desire to take over the world once his rationalist skills allow him to hack magic. He is not depicted as being a bad guy for wanting this.
Speaking of which, remember when I said her Tumblr name "WorldOptimization", was a reference to Rational Harry Potter? It comes from this line, spoken Eliezer's 11-year-old protagonist:
"World domination is such an ugly phrase. I prefer to call it world optimization."
Rational Harry Potter spends a mind-numbing portion of the book's total length discussing his desire to take over the world once his rationalist skills allow him to hack magic. He is not depicted as being a bad guy for wanting this.
In a way, this actually hints after explanations for other things going on in the vicinity of contemporary Rationalism. Evans suggests, "World domination is a background theme that runs through the whole online rationalist community", which would make a certain amount of sense. But that is its own question, for another day.
In our moment, the question is what this has to do with what Caroline Ellison has to do with the FTX collapse. There is a certain easy shrug that goes with saying, "Sounds about right," but there is also an easy facial response that goes, "Oh, come on. FFS, no, no, and no."
____________________
Notes
Evans, Robert. "Rationalist Harry Potter and the Collapse of Crypto". Shatter Zone. 2 December 2022. ShatterZone.Substack.com. 4 December 2022. https://bit.ly/3VEwSyC
I think this sums up the concept pretty well but doesn't touch on the inherent problems.
The problem is that someone create an imaginary token to replace a real currency meant for trading tangible goods and services. For example, there are countless children who bought into bitcoin early who are now millionaires or billionaires. These children did nothing, they produced no goods or services and created no real value. They became inherently wealthy and powerful through blind luck while everyone else had to work for a living.
Obviously this is a big problem which may explain why a large part of global finances has become based on what amounts to gambling on things which have an imaginary value. Gambling on whether the price of something will rise or fall versus it's tangible value to real people in reality. It's a problem because most younger people now believe working for a living is a complete waste of time and a scam. Why should anyone work when they could just bet or buy into the next imaginary scheme and make a killing?. Why work when a 10 year old making youtube video's probably made more than your entire family tree?.
It should be obvious that any financial system based on the value someone imagined in there head is imaginary and must eventually fail. Whenever any system no longer bears any relationship to reality it must eventually fail in reality.
Seattle
Valued Senior Member
You are placing too much emphasis on labor as "work" The guy who pours concrete foundations at building sites all days "works". He is probably paid pretty well but he probably isn't "rich".
If you start a company you may ultimately fail and lose your initial investment or you may succeed and ultimately make a lot of money. Bill Gates made a lot of money. He didn't "work" doing "dirty work" laying concrete so does that mean he doesn't deserve whatever money he has?
You can't do manual work until someone has started a company, legal department, accounting, marketing, etc. I'm not sure if your point is that only hard labor is "real work"?
Regarding Bitcoin, it is a store of value. The dollar or gold don't produce anything by themselves. Bitcoin is no different. Regarding YouTube, it may be true that teenagers can make money on YouTube but that's work. If it was easy, you'd be doing it too.
People making money on YouTube are essentially the modern TV show. Some of them now have studios and staffs as large as any traditional production company. Just putting up a few crappy videos doesn't make much money.
Bitcoin has value because it is limited and to even mine the existing Bitcoin requires paying a price in electricity. It's secure and decentralized. The government can devalue the purchasing power of the dollar. Compare what $100 would buy 100 years ago vs what it will buy today.
The government can't devalue Bitcoin by overspending and under taxing. It can't be manipulated like that.
exchemist
Valued Senior Member
However its value can be manipulated by speculative trading - and by governments' regulatory posture towards it.
It's a speculative commodity: a store of value yes, but a stable store of value, no.
Seattle
Valued Senior Member
Stable depends on the time frame. The US Dollar will lose most of its value on 100 years. How stable is that?
Anything can be manipulated, silver, stocks, real estate.
exchemist
Valued Senior Member
For stability to be a relevant quality for a currency, it means having purchasing power that doesn't swing by a factor of 2 in the space of 18 months.Stable depends on the time frame. The US Dollar will lose most of its value on 100 years. How stable is that?
Anything can be manipulated, silver, stocks, real estate.
Seattle
Valued Senior Member
But for a store of value that might be acceptable. Actually, for a currency if you are just concerned with the spot market even that may not matter. It depends on what you are using it for and how you are using it.
For most people Bitcoin is a store of value and not necessarily a currency. If you live in Venezuela it may be a currency as well if it's more stable than the local currency and if it has other attributes that make it valuable to you such as the ability to quickly move it over the internet.
Most arguments (not all) regarding "crypto currencies" are between people with different definitions and expectations of what the intended use cases are.
The most common argument seems to be "I don't know much about Bitcoin or I don't understand Bitcoin but...and then they trash it" or "What kind of a currency swings this much" when most people aren't intending for it to be a "currency" as in replacing the dollar. In a lot of cases crypto's aren't meant to replace the local currency (in some cases they are). It's unfortunate that they have "currency" in the name.
Bitcoin is mainly a store of value (early in its development) and the rest are meant to be used for fees on their particular blockchains. They are currently speculative though. So was Amazon for a time as well as the degree to which the internet would be useful to the average person.
ChatGPT is in a developmental stage now but I'm guessing it will soon (or something similar) be the most common way we interact with all computers within 5 years or so. That doesn't mean that I can't be wrong about it or Bitcoin but the odds are very good that I'm not wrong.
Last edited:
It looks like bitcoin is in a bubble. Price has gone up around 50% in the last week or so.
exchemist
Valued Senior Member
By "store of value" it seems you mean a speculative investment in a commodity, like coffee or oil. That's fair, I suppose. But on that basis I'm not sure why anyone would prefer it to commodities (oil, coffee, gold....)whose value can be predicted. Bitcoin swings wildly, depending on who has gone bust or been indicted recently (Bankrun-Fraud being the latest casualty).
Seattle
Valued Senior Member
Bitcoin wasn't really affected by those things that much (because it wasn't involved and couldn't be involved-it's decentralized).
I get your commodity analogy but, IMO, Bitcoin has much more going for it than those commodities. It's also likely to become less speculative (and appreciate less) and more stable with greater mass adoption. It's just a less liquid market currently. Even that is partially a good trait. According to the on chain metrics more than 60% (I think that's correct) of Bitcoin hasn't moved in a year. That means people are just holding it in cold storage, don't have it on the exchanges and that's why it is "stable" in terms of adoption which is only going up.
Even when the market goes down, with all the crooks at FTX and all the interconnectedness of the various companies with FTX, Bitcoin is fairly stable and more and more people keep buying and holding, no panic.
There will always be some volatility because the supply is limited to 22 million but as liquidity (mass adoption) increases, volatility should go down. At that point, IMO, it's also likely that Bitcoin becames decoupled from the other markets and can serve as a diversification as well. We'll see of course.
ThazzarBaal
Registered Senior Member
Word salad by any other name is still word salad. The dressing used too tart for my personal taste but still appealing to the word smith side of my psyche. I like a nice sweet vinaigrette with added peppery tones to tempt the sensory pallet. Hmm, cryptocoins and commerce vs. a more tangible currency? As much as I enjoy a mental linguist salad, I enjoy things I can hold even more.
Seattle
Valued Senior Member
I think you have demonstrated that you enjoy a good word salad.
What You Wish For
David Dayen↱ describes some Congressional crypto clownery:
In addition to the Ripple suit, the SEC has hit crypto lender Genesis, as well as the Gemini Trust cryptocurrency exchange with charges for unregistered securities, and fined Nexo, another crypto lender, $45 million for a registration compliance problem Gensler described as "part of the business model".
Security registration issues closed a staking operation at the Kraken exchange, and broker Paxos has been informed to expect charges. Dayen notes, "The SEC's action against Paxos is in turn applicable to the entire stablecoin market."
Singapore-based Terraform faces an SEC suit for some manner of fraud; a former pro athlete was fined for failure to disclose vested interest in promoting Ethereum. The SEC has also proposed a regulatory rule for instiutional investors.
Notes:
Dayen, David. "Congressional Crypto Defenders Accidentally Sparked an SEC Crackdown". The American Prospect. 23 February 2023. Prospect.org. 23 February 2023. http://bit.ly/3kiM3AB
David Dayen↱ describes some Congressional crypto clownery:
The letter from Reps. Patrick McHenry (R-NC), now chair of the committee, and Bill Huizenga (R-MI), oversight subcommittee chair, reflects a change of posture for many House Republicans. In the immediate aftermath of FTX's collapse, GOP members with an affinity for crypto (and a couple of Democrats) were fulminating that Gensler allowed the implosion to happen. Now, apparently, they're mad that Gensler is doing too hasty a job of enforcing the law.
But this behind-covering move from crypto's allies in Congress appears to have been a huge tactical error. The Blockchain Eight, who wrote to the SEC last year to get the agency to back off an inquiry that included an investigation of FTX, turned on a dime once FTX fell, arguing that Gensler and his team "failed to foresee this meltdown," in the words of Rep. Jake Auchincloss (D-MA). That, and the real-world implications of the volatile FTX bankruptcy for investors, gave motivation for Gensler to move to the next phase of enforcement against the crypto industry, which he has done with renewed vigor in the past few months. If the Blockchain Eight actually just wants to protect the public from crypto disasters, Gensler is obliging by rooting out the fraud from every nook and cranny of the industry.
Key to this crackdown is Gensler's repeated contention that most crypto firms are offering unregistered securities to the public, in violation of federal law. Without registration, investors are not given disclosures about the risks of owning the assets. Unregistered securities are also supposed to be off-limits to so-called "unqualified" investors who don't have a certain net worth or annual income. Unregistered offerings are frequently seen as scams, and the SEC has long warned crypto firms that they will go after digital assets that aren't registered.
A pending lawsuit with Ripple Labs over its crypto token XRP, which the SEC has deemed an unregistered security, will go a long way to deciding whether the industry will have to comply with this registration requirement. (A judge last November seemed to side with the SEC on this point, in a case involving the blockchain platform LBRY.) But pressure in the wake of the FTX disaster that the SEC stop crypto scams before they fester invited Gensler to make his move on this front.
"We were starting to get frustrated that [Gensler's] words weren't being matched with action," said Lee Reiners, Policy Director at the Duke Financial Economics Center, who recently testified about crypto in the Senate Banking Committee. "But he was giving the industry a chance to come in and get into compliance. The industry willfully chose to not do that. This is the action part."
But this behind-covering move from crypto's allies in Congress appears to have been a huge tactical error. The Blockchain Eight, who wrote to the SEC last year to get the agency to back off an inquiry that included an investigation of FTX, turned on a dime once FTX fell, arguing that Gensler and his team "failed to foresee this meltdown," in the words of Rep. Jake Auchincloss (D-MA). That, and the real-world implications of the volatile FTX bankruptcy for investors, gave motivation for Gensler to move to the next phase of enforcement against the crypto industry, which he has done with renewed vigor in the past few months. If the Blockchain Eight actually just wants to protect the public from crypto disasters, Gensler is obliging by rooting out the fraud from every nook and cranny of the industry.
Key to this crackdown is Gensler's repeated contention that most crypto firms are offering unregistered securities to the public, in violation of federal law. Without registration, investors are not given disclosures about the risks of owning the assets. Unregistered securities are also supposed to be off-limits to so-called "unqualified" investors who don't have a certain net worth or annual income. Unregistered offerings are frequently seen as scams, and the SEC has long warned crypto firms that they will go after digital assets that aren't registered.
A pending lawsuit with Ripple Labs over its crypto token XRP, which the SEC has deemed an unregistered security, will go a long way to deciding whether the industry will have to comply with this registration requirement. (A judge last November seemed to side with the SEC on this point, in a case involving the blockchain platform LBRY.) But pressure in the wake of the FTX disaster that the SEC stop crypto scams before they fester invited Gensler to make his move on this front.
"We were starting to get frustrated that [Gensler's] words weren't being matched with action," said Lee Reiners, Policy Director at the Duke Financial Economics Center, who recently testified about crypto in the Senate Banking Committee. "But he was giving the industry a chance to come in and get into compliance. The industry willfully chose to not do that. This is the action part."
In addition to the Ripple suit, the SEC has hit crypto lender Genesis, as well as the Gemini Trust cryptocurrency exchange with charges for unregistered securities, and fined Nexo, another crypto lender, $45 million for a registration compliance problem Gensler described as "part of the business model".
Security registration issues closed a staking operation at the Kraken exchange, and broker Paxos has been informed to expect charges. Dayen notes, "The SEC's action against Paxos is in turn applicable to the entire stablecoin market."
Singapore-based Terraform faces an SEC suit for some manner of fraud; a former pro athlete was fined for failure to disclose vested interest in promoting Ethereum. The SEC has also proposed a regulatory rule for instiutional investors.
This aggressiveness has spread to the rest of the government. In January, a group of banking regulators essentially warned financial institutions against holding crypto assets, citing the risk of fraud. Banks have already begun to pull away from the industry. In addition, the Federal Reserve denied access to the payment system to a crypto bank called Custodia.
It should be said that this crackdown is happening without any new legislation from Congress. The SEC is using existing securities laws to contain the industry and section it off from the rest of the financial system. Discretionary enforcement and regulatory guidance depend on the regulators, and does not have the permanence or force of law. But a law from this set of legislators is unlikely to produce much of value for the public. Provisions like the one proposed by Sen. Elizabeth Warren (D-MA) to force crypto firms to comply more stringently with anti-money laundering laws would be welcome. But the more likely legislative outcome from a Congress littered with recipients of crypto cash would be some definitive de-fanging of the SEC's efforts to enforce existing law ....
.... Gensler has outmaneuvered the phalanx of crypto industry mouthpieces and supporters in Congress, using the generalized whining about an alleged lack of action prior to the FTX collapse to take swift action across the crypto space. In fact it was easier to do so after FTX, because industry insiders became more willing to give up information about fraud in their business.
The Blockchain Eight was not all that serious about the SEC's enforcement record, of course; they were looking for a way to pin FTX's troubles on an agency they wanted out of the picture for crypto. But this has now backfired spectacularly.
____________________It should be said that this crackdown is happening without any new legislation from Congress. The SEC is using existing securities laws to contain the industry and section it off from the rest of the financial system. Discretionary enforcement and regulatory guidance depend on the regulators, and does not have the permanence or force of law. But a law from this set of legislators is unlikely to produce much of value for the public. Provisions like the one proposed by Sen. Elizabeth Warren (D-MA) to force crypto firms to comply more stringently with anti-money laundering laws would be welcome. But the more likely legislative outcome from a Congress littered with recipients of crypto cash would be some definitive de-fanging of the SEC's efforts to enforce existing law ....
.... Gensler has outmaneuvered the phalanx of crypto industry mouthpieces and supporters in Congress, using the generalized whining about an alleged lack of action prior to the FTX collapse to take swift action across the crypto space. In fact it was easier to do so after FTX, because industry insiders became more willing to give up information about fraud in their business.
The Blockchain Eight was not all that serious about the SEC's enforcement record, of course; they were looking for a way to pin FTX's troubles on an agency they wanted out of the picture for crypto. But this has now backfired spectacularly.
Notes:
Dayen, David. "Congressional Crypto Defenders Accidentally Sparked an SEC Crackdown". The American Prospect. 23 February 2023. Prospect.org. 23 February 2023. http://bit.ly/3kiM3AB
Coinbase Prepares for SEC Action
Coinbase CEO Brian Armstrong, today, via Twitter↱:
Chief Legal Officer Paul Grewal suggests in a blog post↱ that Coinbase is the real victim, here, but his argument from confusion cannot really be tested until SEC action comes.
____________________
Notes:
@brian_armstrong. "1/ Today Coinbase received a Wells notice from the SEC focused on staking and asset listings. A Wells notice typically precedes an enforcement action." (thread) Twitter. 22 March 2023. Twitter.com. 22 March 2023. https://bit.ly/3yW71Jd
Grewal, Paul. "We asked the SEC for reasonable crypto rules for Americans. We got legal threats instead." Coinbase. 22 March 2023. Coinbase.com. 22 March 2023. https://bit.ly/3z2bNF3
Coinbase CEO Brian Armstrong, today, via Twitter↱:
Today Coinbase received a Wells notice from the SEC focused on staking and asset listings. A Wells notice typically precedes an enforcement action.
Chief Legal Officer Paul Grewal suggests in a blog post↱ that Coinbase is the real victim, here, but his argument from confusion cannot really be tested until SEC action comes.
____________________
Notes:
@brian_armstrong. "1/ Today Coinbase received a Wells notice from the SEC focused on staking and asset listings. A Wells notice typically precedes an enforcement action." (thread) Twitter. 22 March 2023. Twitter.com. 22 March 2023. https://bit.ly/3yW71Jd
Grewal, Paul. "We asked the SEC for reasonable crypto rules for Americans. We got legal threats instead." Coinbase. 22 March 2023. Coinbase.com. 22 March 2023. https://bit.ly/3z2bNF3
exchemist
Valued Senior Member
Another crypto crook seems to have been apprehended: https://www.theguardian.com/world/2...rypto-fugitive-do-kwon-arrested-in-montenegro
I wonder where the next crypto scandal will come from.
I wonder where the next crypto scandal will come from.