Insider Trading at Coinbase
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It feels like there should already be rules in place to handle if, for example, an Amazon exec went and bought property around an area prior to Amazon announcing their new HQ.
One solution is to go a step up the meta. Ban trading for certain groups or classes, like banning parliamentarians and government officials. ..but spouses, kids, friends and cousins make for a pretty substantial loophole.
That said, not regulating against insider trading bleeds very quickly into market manipulation and corruption.
Not sure what the ansers are. This is a very dirty part of the game game. Crypto brings in a new set of players, and it takes years before they'll learn to do this in a way that maintains a stable plausible legitimacy.
We absolutely cannot have second tier people insider trading and rigging markets. It's antistabalizing.
Amazon didn’t, and the coupled sued the condo.
Trying to find the article.
https://www.cnbc.com/2019/02/15/luxury-real-estate-agent-rya...
I feel like this is less someone getting an unfair benefit and more just eager people experiencing at least part of what the regulatory framework is meant to protect them from— which is being taken to the cleaners on the basis of rumours that don't end up panning out.
equities (and some slight case law in the bond markets) have insider trading prohibitions attached, and futures have some newer anti fraud statutes tacked on to them by a different regulatory agency.
The law is not about fairness, but about theft (of inside information). In particular, it is illegal to misappropriate someone else's information you come across to do insider trading for your own benefit. But it is not illegal for someone to use their own information to trade on.
In this case, Coinbase published a list of coins that it might list. As I understand it, it would be illegal if some employee of Coinbase bought these coins prior to the release for his own account (thereby misappropriating the information). But if Coinbase bought them for their account, and then released the list, and then made money on the subsequent rise, that would be perfectly legal.
See for example here:
https://www.bloomberg.com/opinion/articles/2019-03-13/you-ha...
everything old is new again
- nuCypher just randomly started going up on Binance
- the price was still low on coinbase
- the normal thing to do was to withdraw from coinbase and sell on binance
"Oops withdrawal of nucypher is temporarily locked", it stayed locked for 8 hours, all the crypto subs on reddit were screaming about it etc... a normal shitshow.
No explanation whatsoever was given, the only one that makes sense to me is that they do fractional reserve like everyone else, since there is no way everyone is going to withdraw at the same time right? in the 2021 bullrun coinbase received a lot of non technical people who are ok with keeping their funds on their website, so I guess they figured out they could just imitate the banks and start lending the funds people keep there and have you trade imaginary tokens you can't withdraw if you see a better opportunity.
Also: obligatory "not your keys, not your coins" and "don't keep your coins on an exchange".
Unless lobbying can still stop it the EU parlement will outlaw self hosted wallets. Only coins on exchanges will be allowed.
It would just bring crypto back to its roots as a government resistant alt currency. Being uncontrollable was the whole point. Particularly regarding Bitcoin and Monero.
Defi exchanges are the next major advancement to government resistance as well. This space would rapidly mature under government regulating away self custody.
Being the exclusive currency accepted for tax payment is an important part of what makes fiat currencies money.
The government is going to have to suck it up and accept taxes in cryptocurrency. In my country such laws have already been proposed.
I say have to as otherwise a rich private currency economy will grow unmolested by tax collectors.
Isn't it self-hosted anonymous wallets?
Yes, and the proposed restrictions only apply to transactions which directly involve an exchange. You can still have an anonymous self-hosted wallet, you just can't withdraw to it directly; you have to move the funds to a verified wallet address first.
So far I haven't seen any proposed rules about what you can do with the crypto once it's in your wallet, so all this means is that you need to withdraw to your own wallet first before sending the funds anywhere you want.
> (29) This Regulation applies not only to transfers of crypto-assets where both the crypto-asset service provider of the originator and beneficiary are involved but also to transfers of crypto-assets to or from a distributed ledger address not linked to a crypto-asset service provider, so called “unhosted wallets”, as long as there is at least one crypto-asset service provider involved in the transfer of crypto-assets.
> (29a) In cases of a transfer of crypto-assets made from or to a distributed ledger address not linked to a crypto-asset service provider, the crypto-asset service provider will have to obtain information both on the originator and the beneficiary, usually from their customer. However, the crypto-asset service provider will have to verify the accuracy of only the information on their customer and not on the originator or beneficiary with the distributed ledger address not linked to a crypto-asset service provider.
So when a transfer is made to or from an external, non-hosted wallet the exchange is responsible for identifying the wallet's owner.
Also note this clause in the proposed text of the regulation (under Article 2 paragraph 4):
> This Regulation shall not apply to person-to-person transfer of crypto-assets as defined in Article 3(14) of this Regulation.
So transfers between two unhosted wallets are unaffected.
This regulation has been widely misreported, so don't believe everything you read, especially if it doesn't cite the actual text of the regulation.
[0] https://data.consilium.europa.eu/doc/document/ST-14259-2021-...
[1] https://www.consilium.europa.eu/en/press/press-releases/2021...
Absurd and laughable.
I can't wait to start printing and handing out long random numbers.
Now what ?
When you put in a sell order through the normal "retail" interface you're trading with Coinbase itself. Those coins can stay offline in cold storage, as they're just moving numbers around in their database, off-chain. Only withdrawals and periodic internal rebalancing operations (making up for an imbalance between buys & sells) strictly require online access to the keys, and those only affect a small part of the total.
It's really akin to the LME trade halt fiasco, which then became even worse when they retroactively reversed trades. The point is, when they're about to lose money they'll change the rules of the game. If you don't recognize that then you're the sucker at the table.
The LME situation and the DTCC/meme stock situation have very little in common, besides both of them being triggered by extreme price movement. It's much easier to argue that LME was rigging the game, but commodities are a different market that hit a little closer to home when things go bad. If the LME let short hedges get vaporized, the idea that they should have been left out to dry would be very unpopular in the fallout of that situation. Maybe they should have, but you're going to have a hard time convincing people not involved in finance of that.
Unless you are an institutional trader, the market isn't out to get you specifically. You aren't even shit on their shoe. You're shit three counties over, if that. They barely think about you. They barely even know you exist. You're background noise that most large players need to filter out to find out who is actually on the other end of the trade. Financial markets are rigged in the sense that big players will be bailed out and cut loose no matter what. They are not rigged in the sense that a retail investor can be on the losing end of a trade because they didn't understand what's actually happening.
Yes, it's literally their job to account for situations like this. They failed. Pointing out how insane the situation was only points out how poorly they predicted what might happen with private information they still haven't shared publicly. If they can't account for the bets placed then we don't have functioning markets. They knew what the short interest was, they knew what the options chain was, they have data about trades the public can't even see. There were multiple traders pointing towards a potential short squeeze in GME going back well into 2020, so if they could see it why the fuck couldn't the DTCC?
Your stance is "their job was hard therefore it's not their fault." That's quite frankly batshit insane when we're talking about the stock market which is an enormous functioning part of our economy. Yeah man, I'm concerned they don't know what the fuck they're doing because they've already proven they don't. If they didn't care they wouldn't have changed the collateral requirements - you're contradicting reality with your argument.
You can have the last word, I'm not going to respond any further.
Exchanges are banks. They have the exact same problems, only with less regulation.
If you need assets to be immediately available to make on-chain transactions, you should not keep them under custody of centralized exchanges - they can and will delay withdrawals for a variety of reasons and most of them (including CB) do make this clear in ToS.
Now with Travel Rule regulation coming in (CB already started enforcing this in some countries but it will become mostly global over time), you need to specify name and physical address of recipient when withdrawing and this can be subject to manual checks as well, so withdrawals being delayed will become the norm IMO.
Crypto exchanges are trying to convince the world they are a more secure place for your coins. Better IT security and highly funded enough to probably make good on any hacks. The synergy is they want to keep me safe so they can keep their reputation (and their reputation gives them more business).
Is that a fair deal? That's for each of us to decide. Keep your coins where you wish.
I agree that law and regulation plays an important role in the market, but as the market has advanced and become increasingly more complex than previous models, I do not believe Law and regulation has kept up.
The GME fiasco and the resulting litigation is a good example of these problems. And before anyone says this is proof the rules in place work - I'd like to point out that our online brokerage infrastructure and market structure has been around since the early 2000's. It's quite difficult to say what has not been surfaced and recognized. And no, despite the nature of the trade itself, no one should discredit the lawsuit as illegitimate. https://www.thinkadvisor.com/2021/01/29/gamestop-lawsuits-hi...
The absurdity and extreme nature of the GME case shows tells me that there are outstanding issues throughout this value chain. And the belief that our system of rules adequately handles this just because the rules exist is a strong indicator of the moral hazard that prevades our market culture.
The SEC is far from perfect, but what they do adds value to the individual investor in general.
its not pretty
If enough people follow my trades then this can generate demand and actually affect the price.
It doesn't help that they have employed some highly unethical actors in the past and completely failed to do their due diligence. For example when they employed people that were involved in selling hacking tools to nation states that were used in human rights abuses.
There is no reason for that to be made public, and no reason for an insider to find a liquidity pool on Uniswap to start buying that token.
To me, cryptocurrency has been a very cool social experiment in what pure unregulated free market capitalism would work like in practice. Supposedly in place of regulations, companies would live on reputation and trustworthy business practices. If you use poisonous lead in your soup cans, people will stop buying your soup when word gets out, no need to regulate, companies will self-regulate to stay profitable and relevant.
Reputation and trust is probably the most important thing Coinbase can hoard, it's the one way a legitimate company that acts like an exchange and/or bank for cryptocurrency can use to rise above all the scams and dubious services that's going on in the cryptocurrency world. And yet here they are pissing it down the drain for easy short-term profits. Surprise surprise.
The truth is, trust, reputation and even human lives are just input values in the big equation of profits. The free market will always optimize for the best option, even if that option is an overall net loss for humanity.
I genuinely can't think of a good (ie moral) reason to support the idea given how it is predicted to, and has been shown to, play out.
The rate of economic growth and improvement in people's living standards was much higher back then than it is now.
Similarly the average adult back then was much healthier than the average adult nowadays, who is likely overweight or obese with some chronic illness. In spite of the vast amount of pills modern people take. So healthcare hasn't necessarily improved much either.
The gilded age was no paradise and rose tinted views of the era just don't hold up to scrutiny.
[1]https://www.statista.com/statistics/1040079/life-expectancy-...
Life expectancy at birth in the times before modern medicine has always been dragged down significantly by the huge rate of infant mortality. It was more common for a family to have 1-2 dead small children in their past than not. People who lived past 5 or 10 or so would often live to see 70 or so, and 80 or 90 year olds were not unheard of.
During the industrial revolution? I would expect so. At this point we're on the tail end of those improvements.
> Similarly the average adult back then was much healthier than the average adult nowadays, who is likely overweight or obese with some chronic illness.
Life expectancy has been going up for a long time, but on the obesity front the advent of highly sugary foods thanks to food giants is a result of profiteering, not regulation, and people driving everywhere instead of getting exercise is not because of regulation (though it is due to city planning).
> So healthcare hasn't necessarily improved much either.
Are you sincerely arguing that modern medicine isn't much of an improvement over snake oil medicine? The discovery of penicillin alone has saved literally billions* of lives, to say nothing of painkillers, modern surgical hygiene, pharmaceuticals, vaccines, just so so many improvements in healthcare. I can't take this argument seriously I'm afraid, I can only assume it's a post hoc rationalisation.
* hundreds of millions, I misremembered the number.
Speak for yourself. Most well read people associate it with urbanization (made possible by industrialization of agriculture) and huge standard of living improvements that came with the long tail of industrialization. Such "luxuries" as off the shelf clothing, meat products, electric lights, etc. etc became readily available to the common man at a price he could afford at that time.
Other markets like commodities and real estate have gotten along perfectly fine without any insider trading laws.
No, economically speaking insider trading just hurts the market, as all free market models work only in so far as all actors have equal access to information. Unequal information makes the market less efficient. Hidden information that is not used in trades doesn't affect market efficiency, as all actors get a chance to decide a new price once the information becomes public.
> The only people hurt by insider trading are those to whom the person doing insider trading has a fiduciary duty, which for a Coinbase employee would be Coinbase itself.
No, the people most hurt by insider trading are the cpunter-parties to those trades, who are acting on inferior information. It is a type of fraud - I'm acting as if the publicly known information is up to date, but in fact I know something the rest of the market doesn't about the value of the good I'm trading. It's like selling beans that have been publicly shown to be magical, while I happen to know the public show was staged and they are in fact normal beans.
You need to investigate some better models. The useful ones don't assume equal access to information. Uniform access to information doesn't exist, and moreover distribution of information is one of the functions of the market. Information itself is a good which can only be acquired at a cost. Perfect information (not perfectly equal information) would indeed improve efficiency, but that doesn't happen on its own. Unequal information is better for market efficiency than less information; in a trade between A and B, both A and B knowing a relevant fact is ideal but only A or B knowing leads to better trades than neither knowing, provided neither party is actively deceiving the other about the nature of the goods being exchanged.
> It is a type of fraud - I'm acting as if the publicly known information is up to date, but in fact I know something the rest of the market doesn't about the value of the good I'm trading.
"Acting as if" is not the same as making an actionable claim. You are under no obligation to advise anyone on future market conditions. It's only fraud if you make the trade under false pretenses which, unless you actually claimed to be making the trade based on only public information, is not happening here. The product being sold is exactly as described; whatever might happen in the future to affect its market value is out of scope.
> It's like selling beans that have been publicly shown to be magical, while I happen to know the public show was staged and they are in fact normal beans.
There's nothing wrong that so long as you're not misrepresenting your product as having some sort of magic properties (which would include being involved in that staged demonstration). There is no fraud here as long as you do not claim that they are magical. What anyone else might claim about them and the motivations for buying them are not your concern. Your role is simply to provide the advertised product.
I think that at least needs a qualification around what is meant by "hurt". If you were to look at the speed with which information might enter the market, insider trading restrictions might slow things down, for example. Not arguing for insider trading here, but the academic discussion - as I recall it - was/is a bit more nuanced.
However, insider trading erodes confidence in the market and therefore reduces the number of people contributing to and learning from pricing signals.
Trust is a big deal.
Nope. "Non-public information" is part of the definition of insider trading FFS. Only the secondary information represented by the transaction itself becomes public. The counterparty gets what they think is a good price but turns out to be a bad one because of the hidden information. That's a tangible loss to them, and any further trades they make while their putative and actual situations diverge will create more misleading market signals. This is such basic knowledge that it should be required for anyone trading anything riskier than an index fund or seeking a job in finance.
Remember when the news wire was pwned? Someone was selling that news to various investment banks, who would trade on it. I smell a similar thing here.
If coinbase were doing this themselves, would it be illegal? I'm not an expert but I don't think so. Still, it's a very bad look and it strains credulity.
It could also be dumb luck. The same way people look at successful startups and think that is normal. I'd want to see a deeper analysis before judging.
https://www.reddit.com/r/CryptoCurrency/comments/u2f90u/ther...
Rinse and repeat.
[0] https://news.ycombinator.com/item?id=30725449
[1] https://www.cnbc.com/2021/09/15/opensea-insider-trading-rumo...
[2] https://startupsandecon.substack.com/p/you-dont-own-web3-a-c...
[3] https://www.financemagnates.com/cryptocurrency/apecoin-by-yu...
This comment comes across utterly unserious.
Your defensive kneejerk reaction doesn't serve as an opposing argument - if you think differently, all you need to do is provide some evidence.
Those two words usually have a higher burden of proof… unless you’re just putting on a rhetorical performance, that is. QED “unserious”
> If you think differently, all you need to do is provide some evidence.
So is this product a 'scam' then? [0] [1]
I don't deny that there are some companies that are trying to do real things with blockchain tech - but most of the money and effort appears to be going into speculation and/or scamming. Which isn't very productive.
You made the assertion, you claim to have evidence: the onus is on you to provide that evidence, otherwise how can anyone possibly challenge it?
My evidence is that the founder is a hothead who wastes his time leaping into online flame wars with little understanding and no evidence.
Can't you understand that this mode of discussion is totally unproductive?
I'm not sure what your personal attack has to do with this discussion - I guess you could have that opinion if you wanted.
Yes, and that opinion of mine, WITHOUT USEFUL EVIDENCE, is worthless. It's no benefit to this community
That's exactly my point, this mode of discussion is totally unproductive. It's spam. It's just tribal ranting.
Sorry to hear you're in hospital. Hope you're feeling better soon
For better or for worse, it seems the case that most businesses in the so-called cryptocurrency space are working with some pretty dubious "assets" with some pretty dubious backers, which would make your parent comment pretty accurate.
frankly coinbase themselves are known to accumulate vast acoumts of a cryptocurrency before listing, so its not like they would have a reason to do this in such convoluted way.
You really can’t make this up.
Embrace this. It’s exactly what crypto is all about.
What's left unsaid of course is that the only interest deep-pocketed investors have in dismantling elements of the financial system (MC/Visa dominance, KYC/AML checks, suspicious transactions disclosure rules), is so they can replace it with a system that they personally have an equity stake in.
1. Entrepreneur notices an opportunity to avoid overzealous regulations and provide better value to customers
2. Everyone wants a piece of the action, bad actors start to move in and updated regulation is required
3. New regulations get out of hand and start to become extremely costly to comply with (see banks)
4. New entrepreneur comes along with a novel way of avoiding said regulations, providing better value to customers again. Repeat.
At any given point in time the industry is either in cowboy crypto mode, or crusty overregulated bank mode. Both have drawbacks, and it’s just a pendulum that swings back and forth.
You understand I imagine that the regulations don't use the word "unsophisticated" and as such it's a red herring. We have these (few) regulations because banks and their consumers are not entering into a business arrangement on similar footing. I'm not "too big to fail". I don't get a bailout.
Banks love to collude with one another or engage in predatory behavior, and when we repealed the Glass-Steagall act in 1999 it took less than a decade for the subprime mortgage crisis to rear its ugly head. Allowing banks to also act as securities firms will continue to show us these "once in a lifetime" economic recessions every decade or so. And would you look at that? It's been over a decade since the subprime mortgage crisis, yet here we are back in the same glut.
Crypto doesn't solve any of that. It solved double spending. Most of the "exchanges" that people are using are mixing banking and securities, and when crypto blows out there is nothing left to catch most of the retail investors that shoulder that cost. There already are so many examples that listing them is prohibitive, but I'll remind everyone that Mt Gox handled 70% of all Bitcoin transactions at the time and lost 6% of the entire Bitcoin circulation at the time to hacks. No FDIC insurance, do not pass go, do not collect $200. Laissez faire becomes laissez tomber.
I wish people were honest about why they like crypto -- it's a speculative asset in a time when most people can't afford appreciating assets, and it doesn't require an ID if you avoid exchanges so you can buy contraband. The drawbacks are someone can code a button that is difficult to inspect and if you press it your entire wallet is drained with no recourse. Haven't even touched on the energy or silicon expenditures for a system with laughably tiny adoption
Congress changed the regulations, not the regulators.
I really have no idea what examples you're thinking of.
Visa was not the first, and other tries to do a credit/charge before them were much worse or limited in scope. This is similar today to what is happening in web3/crypto. If you don't think the ingenuity of humans will get us somewhere productive with these technologies, then I don't know what to say to you.
Quotes from the article about the launch of visa:
> In the weeks leading up to the launch of BankAmericard, BofA had saturated Fresno mailboxes with an initial mass mailing (or "drop", as they came to be called) of 65,000 unsolicited credit cards
> By March 1959, drops began in San Francisco and Sacramento; by June, BofA was dropping cards in Los Angeles; by October, the entire state of California had been saturated with over 2 million credit cards and BankAmericard was being accepted by 20,000 merchants.[18] However, the program was riddled with problems, as Williams (who had never worked in a bank's loan department) had been too earnest and trusting in his belief in the basic goodness of the bank's customers, and he resigned in December 1959. Twenty-two percent of accounts were delinquent, not the 4% expected, and police departments around the state were confronted by numerous incidents of the brand new crime of credit card fraud.[19] Both politicians and journalists joined the general uproar against Bank of America and its newfangled credit card, especially when it was pointed out that the cardholder agreement held customers liable for all charges, even those resulting from fraud.
They won't, because they achieve nothing that can't already be accomplished with proven technologies. Axie Infinity could easily be built using regular plain old databases, but they built in on the blockchain using a terrible bridge architecture and as a result had $600 million stole. Such innovation.
Isn't this a fact about capitalism and not at all specific to the financial sector?
To me, and many others active somewhere on the "regulated finance" spectrum, the way crypto kept going on and on how awesome "deregulation" is from a consumer standpoint was tragically ironic. The vast majority of regulation is there to protect market participants.
Anyone involved with GME knows this isn’t true.
People involved with GME used to refer themselves as the "Apes", and reading their main forum on /r/wallstreetbets back then, that would be a pretty accurate characterization of what they "know".
If a market allows shorts it should allow a squeeze as a mechanism of balance.
If you want more transparent investments then you should be advocating for reforms that will encourage companies to go public sooner. This would be reversing the trend in recent years where companies stay private longer, which allows them to not disclose how they’re doing.
1. Having an income that qualifies you as an accredited investor doesn't mean that you will have access to higher quality investments.
2. Even if you don't qualify as an accredited investor, you probably still have access to the same set of investments that a capital-poor accredited investor has access to. As an accredited investor, I've never had access to an investment opportunity which I couldn't have also accessed without being an accredited investor. No one checks, and the "opportunities" are mostly not great anyways unless you have a lot of capital and connections.
The operative things that unlock unfair investment opportunities are 1. one's professional network (or family), and 2. access to large amounts of capital.
You can counter this assertion by providing a list of investments which are open to all accredited investors, do not require significant amounts of capital, and which have higher expected return with lower risk than investments that are available to non-accredited investors.
The common misconception that becoming an accredited investor suddenly gives you access to high quality investments with super high returns for low risk is one of the best justifications I've ever seen for keeping the rule in place... which is particularly funny because I'm not even an avid fan of the accredited investor rule.
(WeFunder, specifically, tries to skirt the accredited investor regulation and offers tiny (they advertise "as little as $100") investments to non-accredited investors. It's not clear to me how they're doing that legally other than handwaving "crowdfunding platform" around.)
Accredited investor status itself doesn't give you access to higher quality investments, but it keeps the poors out from being able to angel invest in their professional network. If I'm not an accredited investor and I have $10k that I've saved up and want to plow into my kid's friend's uncle's big thing that they're working on? It might turn out that the uncle's a total scam artist or the next Elon Musk, but it's my $10k. I'm allowed to go to vegas and put it all on black if I wanted to, so why aren't I allowed to invest same as an accredited investor?
There are a few ways that someone bankrupting themselves via bad investments does hurt others:
Dependents will be significantly harmed
They are more likely to end up homeless or in jail on the dime of society
They are less likely to be a productive member of society.
I suppose the libertarian response would be that if someone bankrupts themselves, let them die homeless on the street - but I don't think you'll get agreement from any significant portion of society on that approach and even then someone has to pay to clean up their body.
When are we going to admit that the current rules are no longer working?
Is it objectively better than non-public financial statements? Maybe. Is it worth saying this alone should draw the line on what is considered a "safe" investment? No.
Again, the OP is asking about access, not what you believe about "transparent investments"
We want deregulation when it comes to our money. We want the ability to transact with absolute unconditional freedom and privacy. These exchanges? Hell yes, go ahead and regulate the crap out of them. They are not our friends. They're banks. The biggest failure of crypto is the need for exchanges. We were supposed to mine our own coins and use them in everyday transactions.
I’m curious as to where you’ve seen this sentiment from crypto fans? It seems most of the people getting angry about this are people who already disliked crypto and are using this event to add more fuel to the flames.
I mean, Ethereum itself forked over "hey that's no fair" when the DAO got compromised.
For both points, I'd like to mention that there is no universal value set or profile.
I am a crypto fan and do not “want deregulated finance”. It is not “exactly what crypto is all about”. I think most in the space would actually like to see more sensible regulation.
This is unfortunate. However, in my experience of crypto fans it seems like a large - probably very large - majority of them are fans of deregulation and consider this one of the main positive points of crypto. Would you say that's incorrect?
Even Cobie's tweet is absent any specific stance, and features a funny gif of Nancy Pelosi who is also a beneficiary of some really awesome trades.
Many people are fine just watching addresses and filings and copying their trades. Now we know one address that loads up before Coinbase announces.
For example, perhaps you are in favor of crypto because it is (i) harder for a state to seize or (ii) impossible for a single state to inflate. Those are in part possible because of the distributed decentralized nature of cryptocurrency. Being in favor of those two things does not mean you cannot also be in favor of regulating people that manipulate crypto market by wash trading, in favor of arresting thieves and hackers, in favor of banning insider trading, etc. You can have a system with trustless elements and that still relies on the laws and regulations to enforce certain aspects.
However, one should keep in mind that certainty is not necessarily better—it depends on what the rules are. Operating in a grey area is better than being banned outright, and overly strict regulation can nullify all the advantages of a new system by forcing it into the mold of the old system it's meant to replace. The ideal outcome is that they explicitly adopt a hands-off approach so that the threat of adverse regulation is removed without being replaced by known adverse regulation in the present.
Americans want abortion rights then they pass laws against abortion. Can’t make this up!
Developers want open source then they make closed source products. Can’t make this up!
Literally only 32% of Americans are completely pro-choice: https://news.gallup.com/poll/1576/abortion.aspx
And, actually, most Americans support limitations on abortion.
I'm not sure how you came to the idea that the vast majority of Americans are pro-choice.
It gets muddy when you start to talk about wanting it "legal only under certain circumstances". How the people in that group identify is essentially a coin flip.
> And, actually, most Americans support limitations on abortion.
Yes. Like, I think it should only be legal during the first trimester. I still call myself pro-choice.
There is obviously a spectrum to being pro-choice, but if I had to bet I'd put the majority of pro-choice folks follow: that woman has the right to choose to have an abortion while the fetus is generally considered pre-viability by the medical profession and under extreme circumstances where the life of the mother is at risk and/or the baby is now non-viable or will suffer a short and traumatic life.
First, a quick note. The gallup poll posted by onlyrealcuzzo seems ripe for "lying with statistics" on either side of the issue. For example, we could say "only 32% of people are totally pro-choice" but could also say "open 19% of people are totally pro-life". We could say "60% of people support Roe vs Wade" or we could say "most Americans do not support third trimester abortions without special reason".
Interpreting the poll with respect to a specific claim therefore requires care.
As a reminder, GP stated:
>> Americans want abortion rights then they pass laws against abortion.
First, do Americans want abortion rights?
The only question on the poll that directly asks about "rights" is the question about Roe v Wade, and nearly 60% of respondents do not want Roe-Wade overturned.
Second, do Americans oppose laws being passed against abortion?
Only 22% of respondents are dissatisfied with current laws and also want stricter abortion laws. More importantly, GP's characterization is STARKLY true if we look at how laws have changed recently. E.g., the new Oklahoma and Idaho laws ban abortion in cases of rape/incest. The gallup poll indicates that a whopping 83% of Americans support support first trimester abortions in cases of rape/incest, and that number is still over 50% in the third trimester. This is a clear and unambiguous case of GP being correct according to onlyrealcuzzo's source.
I think it takes a lot of mental gymnastics to interpret the gallup poll as stating that Americans don't oppose the types of abortion laws being passed now, sometimes in strikingly huge majorities.
Im not close to being alone on this. I don’t know anyone in my life who is a “crypto fan” and doesn’t think rules should exist around exchanges.
It’s easy to fight the boogeyman and the HN boogeyman is one of the silliest ones I have seen.
There certainly are some extreme libertarians that think nothing in the financial world should be illegal and that the Free Market(tm) will sort everything out on its own. To them, insider trading isn't unethical, quite the opposite. People should be using every advantage at their disposal. To them, getting a job at Coinbase to get the inside scoop on upcoming coin listings would be a genius move.
This does not follow. Even under the most "extreme libertarian" position insider trading, narrowly construed, would still be an unethical violation of the agent/principal relationship which exists between the employee and the company's owners (the shareholders). Abusing confidential information you have access to as a result of your position for personal gain at the expense of the shareholders would be violation of trust—and most likely a direct breach of your employment contract.
I don't think this is a fair characterization. Most crypto fans I know want regulations, they just want them clearly defined and enforced with software and distributed consensus rather than through corrupt and ineffective organizations like the SEC.
There’s no universe where there’s no insider trading and you’re asking me to switch the Coinbase situation for the Pelosi situation. And I prefer the Coinbase situation.
So I can accept the lesser of two evils and kick up a fuss when I don’t like it. After all, if switching to regulated finance is what you recommend, the cure is worse than the disease.
The "GME level fiasco" was only possible as a one-time event. You don't get situations like that on a recurring basis because the market adapts.
What many people don't realize is that insider trading of assets other than securities could still potentially be criminal fraud. However without the SEC, there is no specialized police force for addressing it.
The SECs core job is to protect investors and assure orderly markets. But it is not clear that buying a crypto asset IS an investment and one job of markets is to take money away from people who make dumb decisions (like buying a crypto "asset" only because Coinbase listed it). So stopping this doesn't actually fit their mandate any more than stopping people betting on sports or buying lottery tickets does.
And that's without getting into the other points people have listed:
* the SEC is toothless * FX isn't a regulated market, you absolutely CAN use "insider" info to trade Euros, USD etc. * its technically AND legally hard to prove insider trading in Crypto (and elsewhere) * if they did, and Coinbase etc moved their operations to unregulated destinations would that actually make anyone safer?
Let me put it this way. Coinbase is just a sliver of what money AMEX is trading and is used as dust in eyes to blind people at real insider trading that happens in real money makers, which are AMEX and the rest of well established banks. Good luck SEC doing anything about it.
Possibly there is also not the political will to ramp up the regulatory speed and power although I still have hope that Biden will be able to change that at least a bit.
Look at the suggested reforms the SEC was supposed to undertake AS IDENTIFIED BY CONGRESS. Then look at what actual reforms where implemented.
I'll help you out - almost none. The SEC has had a monopoly on financial market regulation since the 1930s and is just now becoming a victim to the cultural side affects of this monopoly. Shit, I actually think the SEC has done a phenomenal job regarding this and all other aspects of their job.
The Commodity Futures Trading Commission, Financial Industry Regulatory Authority, National Futures Association, Consumer Financial Protection Bureau, and many others would like a word.
https://en.wikipedia.org/wiki/Commodity_Futures_Trading_Comm...
https://en.wikipedia.org/wiki/Financial_Industry_Regulatory_...
https://en.wikipedia.org/wiki/National_Futures_Association
https://en.wikipedia.org/wiki/Consumer_Financial_Protection_...
"Oh well, you see web3 is like web2 + 1 and we know web1+1 was great so web2+1 must be even better". It's an idiots logic.
If I were to define the two respectively to someone who had never encountered the terms before, web2 would be the centralization of the early internet ecosystem in order to increase scalability + capture/generate profit funnels with web3 being the corresponding deconstruction back towards decentralization and economic distribution thanks to work on improved consensus algorithms in trustless settings.
Web2 had a lot of stars align to become "the next big thing". (The newfound capacity for advertising, smartphones driving adoption, and the mechanisms for tracking and stealing user data). And none of those stars had to deal with privacy, decentralization, security, encryption, etc. All of these things that we have been trying to get consumers to value and consider for years; are actually antithetical to corporation's profit incentive. The tech industry has tried for a very long time. The concepts behind web3, such as decentralization, are not new. They have been tried, and created, and even somewhat adopted, for a VERY long time. Blockchain is just the new mechanism to try and attack this, but like most things on the internet, the problem is not a technical one: It's a social and economic one.
Until you talk about dismantling capitalism, I don't see web3 as being anything more than a natural cycle of niche internet interest combined with speculative market scams that entrap vulnerable populations into caring about it just long enough for them get burned on the latest crypto rugpull.
most wont care about it until their digital purchases start getting sunsetted without migration, and then they notice there is an alternative.
I agree, web3 most likely means less profit to the corporation since the majority of economic value will accrue to the token / ecosystem instead. But it's innovate now or be outcompeted inevitably.
The main selling point of blockchains is that they make governance / economic distribution seamless. That's not dismantling capitalism. Much of what enables consensus in a blockchain requires similar incentive mechanisms to function, in my opinion.
What makes this topic difficult to approach is the degree of complex issues which surrounds it. We are looking at the intersection of technology innovation, the long-standing failure of institutional and market mechanisms, and combined with a bleak macroeconomic context.
Most people here should take a good reminder that they actually aren't experts in everything.
It may still be true that "most people" here don't have a clue about it, but it's a hollow criticism since far more have a clue here than elsewhere.
> Well this is an exceptionally cute idea, but there is absolutely no way that anyone is going to have any faith in this currency.
The claim in the parent post, roughly, is that the HN community is clueless about crypto and economics. In reality, HN had a large hand in popularizing crypto, and criticism here often is based on experience rather than ignorance.
Or make it actually illegal not just “legal if you have enough resources”
You mean like how lobbying is legal in the US?
Ostensibly, lobbyists exist to inform legislative staff about issues which they have no experience with, like an expert witness. You can't expect all ~550 legislators to have an in-depth understanding of every topic that they vote on.
The problem is that our legislative staffs started letting lobbyists come to them, instead of seeking out reliable impartial groups to work with. So when they need information about an upcoming vote, they end up soliciting advice from the wealthiest groups in those industries which the vote would impact.
It's an insidious form of regulatory capture. It might even be worse than bribery, because ordinary citizens cannot participate.
Nice.
There's no insider trading laws in commodities or real estate, have those markets collapsed?
Real estate is an especially bad example too because when selling a house you have to disclose any information about the property that may affect it's future value or risk legal action - but still real estate fraud continues.
That doesn’t stop people from trying to get away with it under the radar tho (small front-running order ahead of large institutional order). The innovation in crypto is frontrunning at the transaction time is more difficult (trades are encrypted, not made in some open outcry pit).
However this doesn’t stop exchanges from screwing over customers by creating demand and someone inside trading their pre-listed asset.
To prevent that programmatically you’d need a crypto protocol for establishing new listings where everyone is aware of new listings in advance and agrees via some fair consensus.
How exactly do you think this happens? If I know that a stock is about to rise significantly, I can just buy it at the current price all the way up to the day the information becomes public, and I will not have changed its price at all, but will profit massively off of my inside information.
The market will not reach the correct price until material information becomes public.
Not if the EMH is true.
Of course you will have, buying affects the price.
I didn't check, but is this really true? If a mining company executive knows that for whatever reason they will see a 10% drop in yield next quarter, but it's not public knowledge, they can buy futures, no problem? All the execs can get together if there's something going on and invest on that info as long as they're investing in the commodity, not stock?
You do realize the amount of scrutiny is far greater, affects all individuals above a certain pay grade at publicly traded companies, and that regulation continuously evolves? Protections against wash and insider trades are an important consumer protection but crypto advocates would rather you believe the current system doesn’t offer those affordances than admit deficiencies in their blockchain based ecosystems