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Crypto

Coinbase V The SEC

<p><em><span style="font-weight: 400;">Hello Wizardians and crypto enthusiasts. </span></em></p> <p> </p> <p><span style="font-weight: 400;">Its been a <a href="https://wizardia.io/blog/wild_rides" target="_blank" rel="noopener">wild ride since the ETF</a> approval right? For whatever reason the markets taken a bit of a shift, but we are still remaining positive and looking forward to the impact of the <a href="https://www.investopedia.com/bitcoin-halving-4843769" target="_blank" rel="noopener">BTC halving</a>&hellip; Right?... Right? ...</span></p> <p> </p> <p><span style="font-weight: 400;">In any case, when the market is up or down there is never a dull day to be had. Certainly, not a day goes by where Gensler and his merry band of anti-crypto trolls aren't trying to spoil the gains and progression of our beloved industry. </span></p> <p> </p> <p><span style="font-size: 12pt;"><strong>While the market is down, it's time to get your Wizard level UP. </strong><strong><a href="https://bit.ly/android-wz" target="_blank" rel="noopener">Download Wizardia on Android today and get 4 wizards FREE!</a></strong></span></p> <p> </p> <p><span style="font-weight: 400;"><picture><source srcset="https://wizardia.io/images/blog/thumb/gensler-troll-6930.webp 576w, https://wizardia.io/images/blog/inner/gensler-troll-6930.webp " type="image/webp"></source><source srcset="https://wizardia.io/images/blog/thumb/gensler-troll-6930.jpeg 576w, https://wizardia.io/images/blog/inner/gensler-troll-6930.jpeg " type="image/jpg"></source><img srcset="https://wizardia.io/images/blog/thumb/gensler-troll-6930.jpeg 576w, https://wizardia.io/images/blog/inner/gensler-troll-6930.jpeg " alt="" loading="lazy" width="1280" height="720"></picture></span></p> <p><span style="font-weight: 400; font-size: 8pt;">Image source www.ai-trolls.io</span></p> <p> </p> <p><span style="font-weight: 400;">The <a href="https://www.sec.gov/" target="_blank" rel="noopener">SEC</a> is arguing those tokens are securities because people buy them as a way to invest in a common “enterprise” and possibly profit from its success. (According to the Howey Test, that makes it a security). </span><span style="font-weight: 400;">Learn more about the <a href="https://www.investopedia.com/does-crypto-pass-the-howey-test-8385183#:~:text=The%20Howey%20test%20is%20a,thus%20subject%20to%20securities%20regulation." target="_blank" rel="noopener">Howey test</a> with investopedia.</span></p> <p> </p> <p><span style="font-weight: 400;"><a href="https://www.coinbase.com/setup/document" target="_blank" rel="noopener">Coinbase</a> is arguing that buying tokens doesn't guarantee the buyer any rights (or profits) as part of the purchase. </span></p> <p><br><br></p> <p><span style="font-size: 36pt;"><strong>GeNsLeR v Coinbase</strong></span></p> <p> </p> <p><span style="font-weight: 400;">So, I'm sure you've heard about the ongoing legal battle between <a href="https://www.coinbase.com/setup/document" target="_blank" rel="noopener">Coinbase</a>, the largest cryptocurrency exchange in the U.S., and the <a href="https://www.sec.gov/" target="_blank" rel="noopener">Securities and Exchange Commission (SEC)</a>. </span></p> <p> </p> <p><span style="font-weight: 400;">It's a pretty big deal, and it could have some major implications for the future of the entire industry.</span></p> <p> </p> <p><picture><source srcset="https://wizardia.io/images/blog/thumb/im-1094.webp 576w, https://wizardia.io/images/blog/inner/im-1094.webp " type="image/webp"></source><source srcset="https://wizardia.io/images/blog/thumb/im-1094.jpg 576w, https://wizardia.io/images/blog/inner/im-1094.jpg " type="image/jpg"></source><img srcset="https://wizardia.io/images/blog/thumb/im-1094.jpg 576w, https://wizardia.io/images/blog/inner/im-1094.jpg " alt="" loading="lazy" width="1600" height="900"></picture></p> <p> </p> <p><span style="font-weight: 400;">So, what's actually going on? Well, the SEC is basically accusing Coinbase of operating as an unregistered broker, exchange, and clearing agency. They also say that Coinbase is selling securities, which is a big no-no without the proper licenses.</span></p> <p> </p> <p><span style="font-weight: 400;">In particular, the SEC accused Coinbase of selling securities and brang 13 cryptocurrencies to attention including <a href="https://solana.com/" target="_blank" rel="noopener">SOL</a>, <a href="https://cardano.org/" target="_blank" rel="noopener">ADA</a>, <a href="https://polygon.technology/" target="_blank" rel="noopener">MATIC</a>, and more.</span></p> <p> </p> <p><span style="font-weight: 400;">Now, Coinbase doesn't agree with the SEC's assessment. They argue that they're just providing a platform for people to trade cryptocurrencies, and that the tokens themselves aren't securities. </span></p> <p> </p> <p><span style="font-weight: 400;">They even compared buying tokens to buying collectibles like Beanie Babies, which aren't considered securities.</span></p> <p> </p> <p><span style="font-weight: 400;">In all seriousness, the SEC really seems to be lost and confused. Here's a tweet showing the ridiculousness of it all...</span></p> <p><br><picture><source srcset="https://wizardia.io/images/blog/thumb/screenshot-2024-01-23-at-103301-3054.webp 576w, https://wizardia.io/images/blog/inner/screenshot-2024-01-23-at-103301-3054.webp " type="image/webp"></source><source srcset="https://wizardia.io/images/blog/thumb/screenshot-2024-01-23-at-103301-3054.jpg 576w, https://wizardia.io/images/blog/inner/screenshot-2024-01-23-at-103301-3054.jpg " type="image/jpg"></source><img srcset="https://wizardia.io/images/blog/thumb/screenshot-2024-01-23-at-103301-3054.jpg 576w, https://wizardia.io/images/blog/inner/screenshot-2024-01-23-at-103301-3054.jpg " alt="" loading="lazy" width="601" height="511"></picture><br><br></p> <p>All January Wizardia has hosted a massive <a href="https://wizardia.io/blog/4_weeks_of_glory" target="_blank" rel="noopener">4 weeks of Glory Free android tournament!</a> Its not to late to win some prizes, get used to the game and be ready for new tournaments in January!</p> <p> </p> <p><span style="font-weight: 400;">However, the SEC are sticking to their guns. They say that the Howey Test, a legal framework that defines a security, applies to cryptocurrencies. The Howey Test basically says that if you're investing in a common enterprise with the expectation of profits primarily from the efforts of others, then you're buying a security.</span></p> <p><br><br></p> <p><em><span style="font-weight: 400;">What do you think? Is the outdated Howey test a reliable method to determine new technologies use cases? </span></em></p> <p><br><br></p> <p><span style="font-weight: 400;">So, who's right? That's the big question that the judge in this case is going to have to answer. And the answer could have a big impact on the future of cryptocurrency regulation in the U.S.</span></p> <p> </p> <p><span style="font-weight: 400;">If the judge rules in Coinbase's favor, it could open up the floodgates for more crypto businesses to operate without having to register with the SEC. This could lead to a wider adoption of cryptocurrencies and more innovation in the industry.</span></p> <p> </p> <p><span style="font-weight: 400;">On the other hand, if the judge rules in the SEC's favor, it could mean that more crypto businesses could face even more regulatory scrutiny and fines. This could stifle innovation and slow down the growth of the industry.</span></p> <p> </p> <p><span style="font-weight: 400;">Either way, it's a pretty big deal. So, stay tuned to see how this one plays out.</span></p> <p> </p> <p><span style="font-weight: 400;">Thanks for reading, and happy hunting!</span></p> <p> </p> <p><strong>PS. Before you go, did you see Wizardias 2024 focus yet? Click <a href="https://wizardia.io/blog/wizardia_2024" target="_blank" rel="noopener">here</a> for more!</strong></p> <p> </p> <p><span style="font-weight: 400;"><picture><source srcset="https://wizardia.io/images/blog/thumb/oig-5632.webp 576w, https://wizardia.io/images/blog/inner/oig-5632.webp " type="image/webp"></source><source srcset="https://wizardia.io/images/blog/thumb/oig-5632.jpeg 576w, https://wizardia.io/images/blog/inner/oig-5632.jpeg " type="image/jpg"></source><img srcset="https://wizardia.io/images/blog/thumb/oig-5632.jpeg 576w, https://wizardia.io/images/blog/inner/oig-5632.jpeg " alt="" loading="lazy" width="1024" height="1024"></picture></span></p> <p> </p> <p><span style="font-size: 12pt;"><strong><a href="https://bit.ly/android-wz" target="_blank" rel="noopener">Download Wizardia on Android today and get 4 wizards FREE!</a></strong></span></p>

3 min read
Jan 23, 2024
Ryan Turnbull
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Contents

Hello Wizardians and crypto enthusiasts. 

 

Its been a wild ride since the ETF approval right? For whatever reason the markets taken a bit of a shift, but we are still remaining positive and looking forward to the impact of the BTC halving… Right?... Right? ...

 

In any case, when the market is up or down there is never a dull day to be had. Certainly, not a day goes by where Gensler and his merry band of anti-crypto trolls aren’t trying to spoil the gains and progression of our beloved industry. 

 

While the market is down, it's time to get your Wizard level UP.  Download Wizardia on Android today and get 4 wizards FREE!

 

Image source www.ai-trolls.io

 

The SEC is arguing those tokens are securities because people buy them as a way to invest in a common “enterprise” and possibly profit from its success. (According to the Howey Test, that makes it a security). Learn more about the Howey test with investopedia.

 

Coinbase is arguing that buying tokens doesn’t guarantee the buyer any rights (or profits) as part of the purchase. 



GeNsLeR v Coinbase

 

So, I'm sure you've heard about the ongoing legal battle between Coinbase, the largest cryptocurrency exchange in the U.S., and the Securities and Exchange Commission (SEC)

 

It's a pretty big deal, and it could have some major implications for the future of the entire industry.

 

 

So, what's actually going on? Well, the SEC is basically accusing Coinbase of operating as an unregistered broker, exchange, and clearing agency. They also say that Coinbase is selling securities, which is a big no-no without the proper licenses.

 

In particular, the SEC accused Coinbase of selling securities and brang 13 cryptocurrencies to attention including SOL, ADA, MATIC, and more.

 

Now, Coinbase doesn't agree with the SEC's assessment. They argue that they're just providing a platform for people to trade cryptocurrencies, and that the tokens themselves aren't securities. 

 

They even compared buying tokens to buying collectibles like Beanie Babies, which aren't considered securities.

 

In all seriousness, the SEC really seems to be lost and confused. Here’s a tweet showing the ridiculousness of it all...




All January Wizardia has hosted a massive 4 weeks of Glory Free android tournament! Its not to late to win some prizes, get used to the game and be ready for new tournaments in January!

 

However, the SEC are sticking to their guns. They say that the Howey Test, a legal framework that defines a security, applies to cryptocurrencies. The Howey Test basically says that if you're investing in a common enterprise with the expectation of profits primarily from the efforts of others, then you're buying a security.



What do you think? Is the outdated Howey test a reliable method to determine new technologies use cases? 



So, who's right? That's the big question that the judge in this case is going to have to answer. And the answer could have a big impact on the future of cryptocurrency regulation in the U.S.

 

If the judge rules in Coinbase's favor, it could open up the floodgates for more crypto businesses to operate without having to register with the SEC. This could lead to a wider adoption of cryptocurrencies and more innovation in the industry.

 

On the other hand, if the judge rules in the SEC's favor, it could mean that more crypto businesses could face even more regulatory scrutiny and fines. This could stifle innovation and slow down the growth of the industry.

 

Either way, it's a pretty big deal. So, stay tuned to see how this one plays out.

 

Thanks for reading, and happy hunting!

 

PS. Before you go, did you see Wizardias 2024 focus yet? Click here for more!

 

 

Download Wizardia on Android today and get 4 wizards FREE!

Ryan Turnbull

Ryan Turnbull

Introducing Ryan Turnbull, a passionate Australian Chief Vibe Officer at Wizardia. Among many things, Ryan builds Wizardia’s community, creates captivating live streams, forms partnerships with other web3 projects, and produces engaging video and blog content. With his expertise, Ryan introduces crypto gaming to both masters and beginners, fostering a vibrant, exciting and supportive environment.

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