Heads up, everybody! We are launching a weekly news recap, so stay tuned after the interview to find out about the top stories in crypto this week! (Links below.)
Zachary Fallon, principal at Blakemore Fallon and former SEC staffer, explains why the SEC penalty against Block.One, which raised $4 billion in a yearlong ICO, got a penalty of just $24 million and didn't have to register EOS tokens as securities. He also discusses how this differs from the Kik case, what we can learn from another SEC order this week against Nebulous and what other gray areas remain for potential token issuers who may want to sell to U.S. citizens. We also go over the Crypto Rating Council, and what significance those ratings could have on the way they are regulated, if any.
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Episode links:
SEC press release about the Block.One settlement: https://www.sec.gov/news/press-release/2019-202
SEC Order re. Block.One: https://www.sec.gov/litigation/admin/2019/33-10714.pdf
Cooley letter on Block.one: https://www.sec.gov/divisions/corpfin/cf-noaction/2019/block.one-093019-506.pdf
Katherine Wu’s annotated settlement: https://static1.squarespace.com/static/5ac136ed12b13f7c187bdf21/t/5d92c33d937a3466c0c723a9/1569899329538/33-10714.pdf
SEC action on Nebulous: https://www.sec.gov/enforce/33-10715-s
Jake Chervinsky tweet storm on the settlement: https://twitter.com/jchervinsky/status/1179162527541993472?s=20
Marco Santori tweet storm on the settlement: https://twitter.com/msantoriESQ/status/1178811671621591040?s=20
Crypto Rating Council: https://www.wsj.com/articles/cryptocurrency-exchanges-including-coinbase-to-rate-digital-assets-11569835801
CRC ratings thus far: https://twitter.com/lawmaster/status/1178627290676301824?s=20
Articles from this week’s news recap:
Paypal to Back Out of Libra Association: https://www.ft.com/content/6af11092-e5fd-11e9-9743-db5a370481bc
Visa, Mastercard, Other Libra Association Members Jittery: https://www.wsj.com/articles/visa-mastercard-others-reconsider-involvement-in-facebook-s-libra-network-11569967023
Federal Advisory Doesn’t Like Libra: https://www.bloomberg.com/news/articles/2019-09-30/bankers-advising-fed-board-describe-libra-as-a-monetary-threat
SEC press release about the order: https://www.sec.gov/news/press-release/2019-202
The order itself: https://www.sec.gov/litigation/admin/2019/33-10714.pdf
Larry Cermak of The Block on the order: https://www.theblockcrypto.com/post/41612/dont-ask-for-permission-hire-good-lawyers-and-then-ask-for-forgiveness
Letter from House Reps re digital dollar: https://static.coindesk.com/wp-content/uploads/2019/10/Foster-Hill-US-Crypto.pdf
Crypto Rating Council: https://www.wsj.com/articles/cryptocurrency-exchanges-including-coinbase-to-rate-digital-assets-11569835801
Cermak tweet storm: https://twitter.com/lawmaster/status/1178622451451867136?s=20
Blockchain executive departures: http://thein.fo/9a4fd2f9cab44d7d
LedgerX-CFTC dispute: https://www.coindesk.com/ledgerx-claims-personal-animus-drove-ex-cftc-chair-to-stall-approvals
Tweets by Paul Chou directed at the CFTC: https://twitter.com/paul_l_chou/status/1177689857763807235?s=20
https://twitter.com/paul_l_chou/status/1177690348883197953?s=20
https://twitter.com/paul_l_chou/status/1177693761050157058?s=20
https://twitter.com/paul_l_chou/status/1177694467043680256?s=20
https://twitter.com/paul_l_chou/status/1177711475760218113?s=20
https://twitter.com/paul_l_chou/status/1177715093251018752?s=20
https://twitter.com/paul_l_chou/status/1177722516497928192?s=20
https://twitter.com/paul_l_chou/status/1177724302927581185?s=20
https://twitter.com/paul_l_chou/status/1177724477439971328?s=20
Paul Chou’s tweet storm: https://twitter.com/paul_l_chou/status/1178328955859951617?s=20
Explanation of the Fairwin Ponzi: https://medium.com/@PhABC/the-collapse-of-fairwins-125m-ponzi-scheme-61a66b273420
Martin Koeppelman graph on Fairwin: https://twitter.com/koeppelmann/status/1178781425585328129/photo/1
Fun Bits:
Bloomberg interview with Jered Kenna: https://www.bloomberg.com/news/articles/2019-10-03/an-early-bitcoin-millionaire-loses-his-love-for-the-industry
My Forbes story on how Kenna lost his Bitcoin: https://www.forbes.com/sites/laurashin/2016/12/20/hackers-have-stolen-millions-of-dollars-in-bitcoin-using-only-phone-numbers/
Special Episode with CNBC's Crypto Trader: Olaf Carlson-Wee on Why This Crypto Winter Is Different From Previous Ones - Ep.028
Willy Woo on Why He Thinks We're Nine Years Away From Half the World Using Bitcoin - Ep.027
Demian Brener, CEO of Zeppelin, on Which Smart Contract Platform Will Win - Ep.026
Multicoin's Kyle Samani on Why He Believes Bitcoin Governance Doesn't Accommodate the Real World - Ep.025
Behind the Tezos Scandal: Conflicts of Interest, Self-Dealing and Bullying - Ep.024
Coinbase's Adam White on a Momentous Day in Crypto - Ep.023
Joey Krug on How to Create a Regular Cryptocurrency - Ep.022
Alex Gladstein of the Human Rights Foundation on the First Crypto War - Ep.021
Jill Carlson on How Crypto Is Replicating Wall Street -- And Not in a Good Way - Ep.020
Mike Novogratz on Why Incumbents Are Still Well Positioned to Participate in Crypto Finance - Ep.019
Battling Corruption With Blockchain Technology: Tomicah Tillemann of the Blockchain Trust Accelerator - Ep.018
The UN World Food Programme's Blockchain-Based Food Vouchers for Syrian Refugees, With Robert Opp - Ep.017
From the Bellagio Blockchain Summit: Blockchain Ethics With Georgetown's Cara LaPointe - Ep.016
From the Multicoin Summit: Ryan Selkis of Messari on How to Fund Sustainable Journalism - Ep.015
Civic's Vinny Lingham on When Crypto Demand Will Catch Up With the Technology
Hu Liang of Omniex on What Institutional Players Are Planning to Do in Crypto
Don Wilson of DRW Holdings on What's Been Driving 2018's Crypto Downturn
How Meltem Demirors Uncovers True Value in Crypto Investments
Chris Burniske of Placeholder on the Downsides of ICOs
Ari Paul of BlockTower Capital on the Crypto Downturn and Why It Could Change Direction
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