It should be easy yes or no from the lawyers, I'm hearing that the law is incredibly clear and not really prone to misinterpretation so it shouldn't be an issue. Or maybe Gensler's lawyers are "extremely inexperienced" if they couldn't figure out such an obvious issue?
> It should be easy yes or no from the lawyers...
When has that ever been the case, and why should it be the case now?
[edit] The law is not just what's written but the entirely of case law. The SEC has provided a framework for analysis of securities in the context of crypto. It's here. [1] And it builds on the DAO report, here. [2]
[1] https://www.sec.gov/files/dlt-framework.pdf
[2] https://www.sec.gov/litigation/investreport/34-81207.pdf
I have no doubt he has discussed the status of ethereum with SEC lawyers before.
Because they're a legal body and what they say off hand is precedent, so of course they have to be measured and thoughtful. This was a shameful display, but not by Gensler.
> I have no doubt he has discussed the status of ethereum with SEC lawyers before.
Me too, but again, I refer you to the DAO Report and the Framework for “Investment Contract” Analysis of Digital Assets
> But that entire notion belies the idea that the regulations are super clear or predictable. The whole reason for this kind of maneuver is because the regulations are not clear or predictable.
They're quite clear, and the whole reason for this kind of maneuver is showboating and pandering. Based on this thread it seems to be working.
In a similar vein I'm confident that Brian and his attorneys have spoken and concluded that they're almost 100% certain to be securities, and for that reason, they chose to avoid working with the SEC at all costs at every point along the way. But of course that determination would undermine the business, so off to court we go.
Because the whole point of the rule of law is that the law same law applies to any clown. If the head of securities law in the country can't tell you whether a basic thing is legal or not then why even bother having a congress and elections and any pretense that we live in something other than a corrupt oligarchy?
> [edit] The law is not just what's written but the entirely of case law. The SEC has provided a framework for analysis of securities in the context of crypto. It's here. [1] And it builds on the DAO report, here. [2]
If the SEC themselves is incapable of applying their framework to the second-most-prominent entry in the category of things it's designed to analyse, then what is that framework good for?
In the linked video the questioner is asking about about potential future cases/decisions and one reason not to comment on specific cases/decisions, as is what happened in the video[0], is that an agency does not want to telegraph their moves ahead of time, since that would give potential criminals a heads up that they are on a deadline and need to focus on cover up their crimes.
If the questioner needs insight into how policing actions are decided they can ask about pervious cases/decisions and the reasoning that went into those pervious cases/decisions.
That's putting the cart before the horse. Catching criminals is supposed to be a means to an end; compliance with the law is supposed to be the end, and getting people to voluntarily stop doing crimes is a win. "We can't tell people what the law is because then they might stop breaking it" is absurd policy.
> If the questioner needs insight into how policing actions are decided they can ask about pervious cases/decisions and the reasoning that went into those pervious cases/decisions.
The whole reason people are arguing about this stuff is that there are no clear precedents (or there are multiple contradictory ones); crypto is similar to a lot of things but not exactly the same as any of them.
The questioner was not asking about what the law was. They were asking a future potential case or enforcement action.
The questioner in the video could have asked about the law and the details and how it has historically been enforced. They did not though. If they did and questions were still dodged then I might agree with what you are putting out here. At the very least I would think the answerer is not well versed on the topic at hand, but I would want the answer to be straight forward with that.
> The whole reason people are arguing about this stuff is that there are no clear precedents (or there are multiple contradictory ones); crypto is similar to a lot of things but not exactly the same as any of them.
I do not know about that. I think the majority of new crypto coins that have made it into the ads I see are scams, probably because the ones that are scams push for advertisement more. Of those they seem to fall into pyramid scheme and obvious security that would probably run foul of other laws as well. In these cases if a lawyer is not giving a clear answer then you need to hire a new lawyer.
Outside the obvious scams I assume there are people who are at best skirting the law at best and some are turning a blind eye, pretending the law is confusing on the topic when it is really not.
So far it seems like the SEC is ruling and enforcing the above cases, clear cut cases. If you have a part of the current enforcement that is on something that is ambiguous rather than pretty clear cut then I would be interested what makes it ambiguous and potentially reading more into it.
This article is in significant part about the SEC going after Coinbase, which made a significant effort to stay on the right side of the rules and only allow crypto tokens that operated in ways that are closely analogous to e.g. frequent flier miles. They wrote a great many blog posts giving their perspective and calling for regulatory clarity.
They list ICOs by the fistful.
I sorted alphabetically and only had to go as far as AAVE to find the first obviously-a-security.
They really didn't try and stay on the right side of anything.
Frequent flyer miles are generally considered to fall under the IRS rebate rule. They're considered rebates on purchases. There's no investment of money (they're a rebate on a purchase), there's no common enterprise, there's no expectation of profit derived from the efforts of others (after all airlines generally devalue miles 10-20% year over year). It fails all prongs of the Howey test. Not to mention you don't own your frequent flyer miles, the airline program does.
If you find me a crypto token that operates 'like a frequent flyer mile' I'll happily tell you why you didn't.
> They wrote a great many blog posts giving their perspective and calling for regulatory clarity.
They wrote a lot of blog posts, I'll give you that. They have regulatory clarity, they just don't like it. [1, 2, lots of case law].
[1] https://www.sec.gov/corpfin/framework-investment-contract-an...
[2] https://www.sec.gov/litigation/investreport/34-81207.pdf
Seems pretty dubious when there are well-documented cases of the miles being worth a lot more than the purchase (from the famous pudding guy onwards). Hell, mine explicitly advertises the option to "buy miles".
> there's no common enterprise, there's no expectation of profit derived from the efforts of others
Miles become more or less valuable depending on how well the airline is doing, exactly like how these tokens tend to go.
> Not to mention you don't own your frequent flyer miles, the airline program does.
The whole point of Howey is that the details of the ownership structure don't matter, the overall economic effect is what does.
You can sell your token in this case right, but you can not sell the airline miles, not in the rule/tos of the miles program, at least that is my understanding.
>> Not to mention you don't own your frequent flyer miles, the airline program does.
>The whole point of Howey is that the details of the ownership structure don't matter, the overall economic effect is what does.
This does not seem the structure or details of ownership, it is flat out whether you own the miles or not.
If you have an example of token that acted more like an airline miles and there is an action against it or because of it I am interested to read more about that token and SEC reasoning.
There may notionally be a rule against it, but you certainly can - my airline will let you transfer them (for a fee in miles) and they certainly know or should know that buying and selling happens.
> This does not seem the structure or details of ownership, it is flat out whether you own the miles or not.
You're the beneficiary of them and have contractual rights to them, whether they're notionally held by some other party or not. If anything the idea that you don't own them makes the argument for it being a security stronger.
I think you might mean the "potential suspects" of the investigation.
"Criminal" as a basic categorization is binary in nature. All non-criminals are also "potential criminals." No criminals are "potential criminals" (they've already realized said potential).