Conversation

Jesse Powell
@jespow
1/ Problem with going ahead now is fines/penalties can be astronomical. Will a judge understand the complex issues and side against the government? Will SEC retaliate? Refusal to discuss merits is just more leverage to force a settlement/shutdown.
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Jerry Brito
@jerrybrito
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1/ If true, this is pretty underhanded. I know it's easy for me to say, but Coinbase should go ahead and launch its product, let the SEC sue, and go to court. Let the SEC make its case and let a judge decide what the law is. blog.coinbase.com/the-sec-has-to
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Jesse Powell
@jespow
2/ “We won’t tell you why we think your product is illegal but we will tell you that there is no path to making it legal. Disagree? Go ahead and see what happens.” SEC is not the only regulator playing this game. It’s getting to be more common tactic because it works.
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Jesse Powell
@jespow
3/ US companies are being hobbled vs competitors because of selective enforcement. Is it protecting consumers? No. They’ll either go offshore to the many unbothered, freely operating alternatives or they will simply lose out on the opportunities offered by crypto.
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Jesse Powell
@jespow
4/ the only reasonable paths here are: 1. Enforce against domestic companies simultaneously and only after you have enforced against all offshore competition; 2. Create a reasonable, legal path to offer these basic crypto-enabled financial products that consumers demand.
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Jesse Powell
@jespow
5/ current approach makes it look like our regulators work for the legacy banking cartel, not consumers. I assure you that consumers are not harmed by CEX 5% yield or DEX trading but they are absolutely harmed by being prevented from taking advantage of them.
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Paul Amery
@newmoneyreview
How can you say consumers are not at risk of harm from a CEX 5% yield? They are putting their principal at risk (Coinbase says it guarantees the principal, but that guarantee carries severe wrong-way risk). And there is no FDIC insurance.
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Jared
@TheDivineStein
Replying to
@jespow
and
@newmoneyreview
It’s irrelevant if there’s risk or not. Tell me about the risk and let me decide if I have an appetite for it. This is like the whole accredited investor and pattern day trader rules that lock (being improved upon) the average joe out of private equity and public market rotations
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Jared
@TheDivineStein
If there’s fraud we have a judiciary system for that. What’s the actual worry? The same gov’t that promotes taking out $200k+ in debt to get a random degree wants to make sure I don’t become poor and need their assistance? Can I take the risks and opt out of their assistance?
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Paul Amery
@newmoneyreview
Replying to
@jespow
Those are exactly the same arguments that were made for the safety of principal-guaranteed money market funds in the run-up to the 2008 crisis. They didn't work then and there's no reason they would work now either
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