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Here's a blog from Paul Grewal, chief legal officer at Coinbase.
— Frank Chaparro (@fintechfrank) September 8, 2021
The SEC has told us it wants to sue us over Lend. We don’t know why.https://t.co/qschHwE7pK
Me on my first day of financial journalism out of university ? The CEO of a $56bn company
— Mike Bird (@Birdyword) September 8, 2021
Not understanding securities https://t.co/xd26PEIs8I
21/ Our door remains open. Hopefully the SEC steps up to create the clarity this industry deserves, without harming consumers and companies in the process. America could really use us all working together to figure this out right now.
— Brian Armstrong (@brian_armstrong) September 8, 2021
This is state behavior I would expect from the CCP, not the American financial regulators, tbh.
— Ryan Selkis (@twobitidiot) September 8, 2021
cc: @SenLummis @tedcruz @SenToomey this is truly unbelievable and it would be good to have some answers from the SEC. https://t.co/nqFZKB9G1m
When fintech arrogance collides with staggering ignorance of over a century’s worth of securities & banking laws, epic stupidity supernovas like this thread are the result: https://t.co/244ZyKmF8N
— Will Slaughter (@MilwaukeeBonds) September 8, 2021
CEO of Coinbase calls out the SEC for blocking them from shipping features using selectively enforced rules. Going public against a regulator is a risky approach but given how hostile regulators are to tech all over the world, not much left to lose by getting public on their side https://t.co/Gx3aIyIGi1
— Dare Obasanjo (@Carnage4Life) September 8, 2021
I think ... the SEC just subtweeted the CEO of Coinbase. https://t.co/2Ow9oxzetu
— Owen Thomas (@owenthomas) September 8, 2021
This is what happens when you constantly think you are innovating by recreating the existing financial system bit by bit. You fail to realize your new idea is essentially a very old regulated idea. The Howey Test, which the SEC cited is simple, Coinbase is just being childish. https://t.co/cwsko7EVed
— Kevin Kolk ?? (@siberianmi) September 8, 2021
*angrily demanding someone at the SEC personally invite me to google the term “bonds”* https://t.co/PguCDHTUEG
— southpaw (@nycsouthpaw) September 8, 2021
So glad that Brian is putting this shady behavior by the SEC in the spotlight.
— eric.eth (@econoar) September 8, 2021
As a US citizen, I'll do all I personally can to vote against anyone that supports this type of behavior. https://t.co/K6wjFMCacH
13/ Shutting these down would arguably be harming consumers more than protecting them, and by preventing Coinbase from launching the same thing that other companies already have live, they're creating an unfair market.
— Brian Armstrong (@brian_armstrong) September 8, 2021
9/ Meanwhile, plenty of other crypto companies continue to offer a lend feature, but Coinbase is somehow not allowed to.
— Brian Armstrong (@brian_armstrong) September 8, 2021
Welp, if the SEC doesn't want us to stake usdc in coinbase I guess we'll just have to withdrawal to ethereum, lock it in aave, borrow usdt against it, buy uni with that, bridge the uni to bsc, lock the uni in cream, borrow bnb against the uni, and buy nudey nfts on treat
— Jebus (@jebus911) September 8, 2021
Crypto and digital assets markets need clear and sensible regulations. There’s broad consensus on the need for Congress to take up this important area of policy, and we at @coinbase look forward to contributing to that effort. https://t.co/8xmTv42B15
— Faryar Shirzad (@faryarshirzad) September 8, 2021
It's a shame this guy can't talk about politics at work https://t.co/1mps5lQdfH
— Ryan Lawler (@ryanlawler) September 8, 2021
Coinbase blog: "They have only told us that they are assessing our Lend product through the prism of decades-old Supreme Court cases called Howey and Reves. ...These two cases are from 1946 and 1990."
— Tom Morris ?️? (@tommorris) September 8, 2021
Bold defence strategy: "the Offences Against the Person Act 1861 is too old".
Dude runs a multibillion-dollar crypto company and doesn’t understand what a security is https://t.co/LI8MNiRD8K
— Joel Fleming (@jfleming2870) September 8, 2021
If you want to know why the finreg community often harps on things like "chilling effects" and "regulatory uncertainty." This thread is a pretty brutal example of why innovation is extremely hard under a murky enforcement regime. https://t.co/2F14g4yc9q
— Chad Reese (@ChadMReese) September 8, 2021
Remember when Robinhood tried to turn their SIPC protection into an unregulated checking account before someone immediately called them to say “knock it off, dipshit”? That’s basically this, but with a significantly dumber management picking up the phone
— Quantian (@quantian1) September 8, 2021
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. https://t.co/iRQRvANGTW
— Jerry Brito (@jerrybrito) September 8, 2021
CEO of a $50bn company hasn't heard of the bond market https://t.co/qOzZxCLLCh
— Robert Smith (@BondHack) September 8, 2021
I’d feel bad for you, but then I remember how you delisted #XRP and partook in the process of dumping it 80%. I feel bad for the hundreds of thousands of investors instead, fren.? https://t.co/IYrAYyYxOs
— ???Robert Art??? (@SirRobArtII1) September 8, 2021
Not true. But when you carefully read the Complaint filed against both #Ripple and #XRP by the SEC and you ignore the irrelevant noise contained therein (which is meant to distract and divide the crypto community), you see the true and dangerous intentions of the SEC.
— John E Deaton (@JohnEDeaton1) September 8, 2021
After months of trying to engage with the @SECGov on our planned Coinbase Lend product, we recently received notice that it intends to pursue legal action against us. We believe dialogue is at the heart of good regulation, even if the SEC may not. https://t.co/OumvyTPQdj
— Coinbase (@coinbase) September 8, 2021
2/ Millions of crypto holders have been earning yield on their assets over the last few years. It makes sense, if you want to lend out your funds, you can earn a return. Everyone seems happy.
— Brian Armstrong (@brian_armstrong) September 8, 2021
The SEC warned it will sue Coinbase over a planned high yield crypto savings product. The company's CEO lashed out on Twitter https://t.co/eXbVJmFjXM pic.twitter.com/I5ywrqla9Z
— Decrypt (@decryptmedia) September 8, 2021
20/ If we end up in court we may finally get the regulatory clarity the SEC refuses to provide. But regulation by litigation should be the last resort for the SEC, not the first.
— Brian Armstrong (@brian_armstrong) September 8, 2021
This isn't about sympathy with $COIN per se. But new lending products, built by anonymous teams, are being spun up every day. They're a little different than something like Lend, but it still creates essentially two different tracks, with one being at a major disadvantage.
— Joe Weisenthal (@TheStalwart) September 8, 2021
It is an extremely good development that more people are coming forward with complaints about extralegal pressure emanating from USG https://t.co/veiRDUWHM0
— mattparlmer ? (@mattparlmer) September 8, 2021
Seriously are you an idiot. Try the FIRST PAGE of The Securities Act of 1933. pic.twitter.com/5VxhJpTHPE
— John_Hempton (@John_Hempton) September 8, 2021
Everyone has been discussing the Howey Test for months/years. It needs to be tested for 'crypto deposits'. It's not 'zero explanation'. This is how it works. pic.twitter.com/kw558i68U0
— Neil Smith (@Machiavellecon) September 8, 2021
I’m wondering if anyone at the SEC has read this great blog post on how to respond to attacks in (social) media. https://t.co/QxwUfP5FwQ
— parker (@pt) September 8, 2021
Here’s what’s really going on with the SEC and Coinbase
— LeighDrogen.eth (@LDrogen) September 8, 2021
Gensler is desperate to prevent a mainstream financial application from integrating a yield product with decent UX for mass adoption because he knows that’s the killer app that on boards everyone to Crypto
This is an incredible and hilarious dunk on @coinbase and @brian_armstrong.
— Bucco Capital (@buccocapital) September 8, 2021
I am LOVING having a social-media literate SEC https://t.co/R4QJlgbavC
'Brian Armstrong, Coinbase’s chief executive, took to Twitter to attack the SEC, arguing that its actions constituted “sketchy behaviour”.'
— Katie Martin (@katie_martin_fx) September 8, 2021
*chef kiss* https://t.co/y9GUdFsWHS
Cryptocurrency is basically the sovereign citizen movement for money, which is why it's so important not to lend it legitimacy. The SEC's manifest desire to fire it all into the Sun is gratifying if overdue
— Pinboard (@Pinboard) September 8, 2021
I hope @GaryGensler responds. I have known him to be a straight shooter. Let’s see. Thanks for the update @brian_armstrong. https://t.co/P9Iu7c0dDL
— Mike Novogratz (@novogratz) September 8, 2021
This seems like the general problem with the state of crypto regulation right now. Any company that tries to make a point of being a good player automatically falls behind https://t.co/zF03mZImIU pic.twitter.com/jx4gNqtxKA
— Joe Weisenthal (@TheStalwart) September 8, 2021
1/ The SEC isn’t protecting investors, or promoting fair, efficient, & safe domestic crypto markets with their intimidation tactics.
— Ryan Selkis (@twobitidiot) September 8, 2021
Their approach has been so poor it’s indistinguishable from an active effort to *hurt* American retail investors, which looks increasingly likely. https://t.co/nqFZKB9G1m
“Yield” products are securities. They differ in no material respect from an unsecured bond. They just don’t use the name.
— Preston Byrne (@prestonjbyrne) September 8, 2021
Other countries, like England, have debt crowdfunding rules. US cos should check that out and we should emulate those rules here. https://t.co/8BRbu6s4nv
1/ Some really sketchy behavior coming out of the SEC recently.
— Brian Armstrong (@brian_armstrong) September 8, 2021
Story time…
The most interesting thing about the SEC going after Coinbase and Uniswap is I’m not sure they’ve ever dealt with ANYTHING like the united crypto community.
— eric.eth (@econoar) September 8, 2021
Typically they go after someone or some company that may have a few vocal supporters.
Good luck…
This thread about how the SEC is being mean to the company trying to hook cryptocurrency scams into the real economy creates an acute crisis for nanoluthiers, who are still decades away from being able to build an atomic scale violin and thought they had more time https://t.co/OCso4xvkxX
— Pinboard (@Pinboard) September 8, 2021
The replies and quote tweets are gold: https://t.co/JnO1PnDonq
— Miguel “mask and vax” de Icaza (@migueldeicaza) September 8, 2021
Regulatory capture 101.
— J◎e McCann (@joemccann) September 8, 2021
Banks don't want this type of lending because the rates are higher than they can offer. SEC protects the banks (Dodd-Frank Act handed the banks the keys to the castle).
It's a pity. https://t.co/rGCIANeWuh
6/ They refuse to tell us why they think it's a security, and instead subpoena a bunch of records from us (we comply), demand testimony from our employees (we comply), and then tell us they will be suing us if we proceed to launch, with zero explanation as to why.
— Brian Armstrong (@brian_armstrong) September 8, 2021
1. Asking the SEC "How can lending be a security?" is like asking the IRS "Whaddayamean you just get to keep some of my paycheck?" Um, what do you really expect them to say to that?
— Jeremy C. Owens (@jowens510) September 8, 2021
2. Some reporter heard of this dispute and is living the "He just ... He tweeted it out" meme rn. https://t.co/YR3RwsUUOm
the CEO of coinbase asking the SEC 'how lending can be a security?' is just deeply funny https://t.co/WzwWeF4Ges
— Matt Lamers (@MattHLamers) September 8, 2021
“But once again, we got no explanation from the SEC. Instead, they opened a formal investigation.”
— Erik Voorhees (@ErikVoorhees) September 8, 2021
Thank you @coinbase for opening up about this. Most companies wouldn’t. https://t.co/K19N3GTVeV
5/ They responded by telling us this lend feature is a security. Ok - seems strange, how can lending be a security? So we ask the SEC to help us understand and share their view. We always make an effort to work proactively with regulators, and keep an open mind.
— Brian Armstrong (@brian_armstrong) September 8, 2021
In this thread, the CEO of Coinbase criticizes the SEC for not explaining to them why lending an asset for yield is a security. https://t.co/EfIpcaAnHq
— Matt Ford (@fordm) September 8, 2021
4/ We were planning to go live in a few weeks, so we reached out to the SEC to give them a friendly heads up and briefinghttps://t.co/Las8wx22CX
— Brian Armstrong (@brian_armstrong) September 8, 2021
Uh oh. Looks like Gensler, is making a play against interest bearing coins (PoS staking - which may be crypto asset securities), and Coinbase is the prime candidate for establishing the precedence. Brian appears to be publicly proclaiming differential treatment against Coinbase. https://t.co/E5VfdhWHdZ
— Preston Pysh (@PrestonPysh) September 8, 2021
@GaryGensler in his letter to @ewarren and in his recent public remarks makes clear that he is coming after exchanges and #DeFi next. Brian’s tweet proves it.
— John E Deaton (@JohnEDeaton1) September 8, 2021
It’s time the community ends the bullshit tribalism and organizes an entity designed not only to fight back, but win. https://t.co/y9MFVveplR
The CEO of Coinbase asks “how can lending be a security?”
— Dan Awrey (@DanAwrey) September 8, 2021
1. Lending = debt.
2. Debt is mentioned in the definition of a “security” under the ‘33 Act on no less than FIVE separate occasions.
3. When you issue debt securities you’re not lending, you’re *borrowing*. https://t.co/2mYIzDwQbJ
It reminds me of a famous quote : " We are from the government and we are here to help you ". Lovely kind of people. https://t.co/0mDxaPH1IX
— Ricardo Salinas Pliego (@RicardoBSalinas) September 8, 2021
I’m having a hard time believing @brian_armstrong built Coinbase into what it is today without understanding why this yield product would create a security. It neatly satisfies all 4 prongs of the Howey test, textbook style. https://t.co/uftd3KPRWR
— George Bordianu (@george_balance) September 8, 2021
https://t.co/8NupQPMBaT pic.twitter.com/SO5QDqdrMY
— Brad Garlinghouse (@bgarlinghouse) September 8, 2021
Brian, this is "Regulation via Litigation". They aren't capable of working through this themselves and are afraid of making mistakes in doing so. They they leave it to the lawyers. Just the people you don't want impacting the new technologies. You have to go on the offensive
— Mark Cuban (@mcuban) September 8, 2021
Crypto needs to grow up. Uber’s early government relations playbook is not a helpful model to emulate here. https://t.co/OZr1kG5L9I
— Luther Lowe (@lutherlowe) September 8, 2021
11/ If you don't want this activity, then simply publish your position, in writing, and enforce it evenly across the industry.
— Brian Armstrong (@brian_armstrong) September 8, 2021
"How can lending be a security?" asks the CEO of a $55 billion publicly traded company that issued $1.25B of convertible bonds earlier this year. https://t.co/FFvZKh3l8K
— Corey Quinn (@QuinnyPig) September 8, 2021
SEC looking into how $COIN can offer a double digit yield on its $USDC offerings. The obviously juicy return is operating in murky regulatory waters. $VMNT is launching its yield generating stablecoin $USDV with compliance in mind. Soon everyone will know about it https://t.co/vpdbG7zGoJ
— GrowthStockGuru (@man_growth) September 8, 2021
This SEC intervention could potentially have wide-ranging implications for crypto/DeFi. Yield products are an absolutely huge business & if they are considered securities, it would obv really raise the bar on issuing them. (Story by @MsHannahMurphy) https://t.co/vR5BCXhEVG
— Adam Samson (@adamsamson) September 8, 2021
8/ But in this case they are refusing to offer any opinion in writing to the industry on what should be allowed and why, and instead are engaging in intimidation tactics behind closed doors. Whatever their theory is here, it feels like a reach/land grab vs other regulators.
— Brian Armstrong (@brian_armstrong) September 8, 2021
The entire point of having a regulatory apparatus- as distinct from a legal one- is so someone can say “Yeah, absolutely do not do that specific thing you think is very clever, I’ll come up with a general reason why not after I think of it”. https://t.co/3QWYqi1pgO
— Quantian (@quantian1) September 8, 2021
17/ We've always tried to be good actors in the space - leaning in to sensible regulation even when it is difficult or expensive. We try to think about what products we would want for ourselves, and what risks we would want our families to be aware of, before launching products.
— Brian Armstrong (@brian_armstrong) September 8, 2021
Wow big crypto regulatory development
— Frank Chaparro (@fintechfrank) September 8, 2021
Brian Armstrong responds to SEC subpoena, threats to shut down Coinbase yield producthttps://t.co/cjn6RGe0O4
Can someone explain to me how a crypto company can afford to pay 7% interest on your crypto holdings?
— jason@calacanis.com (@Jason) September 8, 2021
Who are they loaning the crypto to & how much interest are those folks paying? https://t.co/NtMkxGXdKK
?
— Laura Shin (@laurashin) September 8, 2021
I feel the positive sentiment from earlier this year about Gensler helming the SEC has shifted ... https://t.co/VtCOFIviRn
? and now maybe u see why when one is attacked we all are under attack.#relistxrp and together we will fight this https://t.co/Ls03BmYxDQ
— Jungle Inc XRP (@jungleincxrp) September 8, 2021
Imagine thinking the SEC is gonna let one of the only legitimate exchanges (actual USD on/off ramp) offer 4% yield. You have to put your money in the hands of their banker friends for 0.2% APY like every other pleb. https://t.co/cJvZB50DXB
— Crypto Chase (@Crypto_Chase) September 8, 2021
Armstrong is really good at these types of comms. He brings issues into the open, rather than solely pumping money into traditional lobby groups behind closed doors. Will the SEC cave? I don’t know! But Coinbase will own the public perception. https://t.co/Dbg7MZT6MZ
— Daniel Sinclair (@_DanielSinclair) September 8, 2021
SEC threatens to sue Coinbase, CEO calls it ‘really sketchy behavior’ https://t.co/3q10wZvaNt via @nypost
— Crypto & Policy (@cryptolicy) September 8, 2021
SEC threatens to sue Coinbase, CEO calls it 'really sketchy behavior' https://t.co/J5ATIfVtyk pic.twitter.com/oKV3RX3g9S
— New York Post (@nypost) September 8, 2021
SEC threatens to sue Coinbase, CEO calls it 'really sketchy behavior' https://t.co/W2mulknar6 pic.twitter.com/wYb4PRzcxl
— New York Post (@nypost) September 8, 2021
スクラップ貸付製品または私たちが訴える、SECはCoinbaseに伝えますhttps://t.co/DMkd90obFv
— コイン海外速報 -仮想通貨ニュース- (@CoinNewsFlash) September 8, 2021
SEC Threatens To Sue @coinbase If It Launches New High-yield Savings Account
— Rob Viglione (@robviglione) September 8, 2021
I’m no legal expert but this smells wrong @Crypto_Counsel #bitcoin #crypto https://t.co/bwQEFhXQ1P
SECは、高利回りの普通預金口座をめぐってCoinbaseを訴えると脅迫しているhttps://t.co/uoPRKJ3nxL
— コイン海外速報 -仮想通貨ニュース- (@CoinNewsFlash) September 8, 2021
Brian Armstrong responds to SEC threats to shut down Coinbase yield producthttps://t.co/AYY9VlcGkI
— The Block (@TheBlock__) September 8, 2021
Brian Armstrong responds to SEC threats to shut down Coinbase yield producthttps://t.co/cQxhHycPfS
— ?? MACKATTACK XRP ?? (@MackAttackXRP) September 8, 2021
ICYMI: Brian Armstrong responds to SEC threats to shut down Coinbase yield producthttps://t.co/AYY9VlcGkI
— The Block (@TheBlock__) September 8, 2021
#xrpcommunity
— JamesRuleXRP?HODL?DYOR?Don't FOMO??? (@RuleXRP) September 8, 2021
Brian Armstrong @brian_armstrong responds to SEC threats to shut down Coinbase @coinbase yield producthttps://t.co/fkXnKqdMT9
ブライアン・アームストロング氏、Coinbaseの利回り商品を停止させるというSECの脅迫に反論https://t.co/LKoZl4Bz0W
— XRP リップル先生 (@xrpripple7) September 8, 2021
ブライアンアームストロングは、SECの脅威に対応してCoinbaseの利回り製品をシャットダウンしますhttps://t.co/gDTTjWUZob
— コイン海外速報 -仮想通貨ニュース- (@CoinNewsFlash) September 8, 2021
"SEC Has Failed To Be Transparent About Its Crypto Policies"#SEC #Coinbase #cryptonews $XRP #cryptohttps://t.co/vGcMlVWe3t
— Kevin Cage (@Kevin_Cage_) September 8, 2021
The SEC shuts the door to retail investors looking to earn more than 0.5% on savings—even as crypto vets make bank.
— Jeff Roberts (@jeffjohnroberts) September 8, 2021
Also, this means BlockFi is totally f***ed.https://t.co/wmPQJmMJOD
Scrap Lend Product Or We’ll Sue, SEC Tells Coinbase |
— Nicholas Black (@NicholasBlack60) September 8, 2021
I hope we all see this for what it actually is: banks, insurance companies & financial institutions are starting to panic, putting pressure through late night phone calls to the SEC.
Poor form, Gary. https://t.co/pLfkRnIml1
I'm so glad the #SEC is out there making sure that I have to get shit interest from a bank, that will use my money and not reward me, vs me being able to be in control of my funds and get a higher interest rate. #BeYourOwnBank #Cryptohttps://t.co/XawzRWqLzr
— Thomas Butcher (@tommybutcher) September 9, 2021
Coinbaseってこの手のことを一番上手くハンドリング出来ている様に思ったけど、そうでもないんだな。Binanceよりはってくらいだろうかhttps://t.co/4KH3iJtfCh
— touya (@touya_huji) September 8, 2021