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Comment by eqmvii | Hacker News Reader

Hopefully it means more people sober up about the shell game that is crypto, and we get some common sense regulation to stop the proliferation of get rich quick schemes and outright scams.

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Let's hear some of this "common sense" regulation that will allegedly arrest scams and illicit schemes.

I don’t think there’s a silver bullet, but common sense regulation should be able to stop things like the Stablegains fiasco, where VCs pay to promote an obviously fraudulent 15% earnings guarantee backed by investing in a Ponzi scheme. Impose disclosure requirements when crypto companies make income promises or something.

I absolutely blame regulators for not enforcing existing laws against these blatant frauds. Celsius was based in New Jersey!

We need laws now to outlaw securities and commodities fraud, and other types of Ponzi schemes! On wait, those are already on the books.

And those laws do help. It is harder to commit such schemes due to disclosure laws. Scams like Bernie Madoff's would be more difficult today due to more stringent auditing and reporting requirements that allow regulators to check up on trades and balances in accounts.

Such laws don't really apply to crypto schemes. And they definitely should.

I agree with you - except for the legislation part, government is hardly ever the answer. But you could say the same about the Ponzi scheme of VCs investing in startups that they know make no sense economically except with the hope that they can pawn the companies off to retail investors in the public market.

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