Hey Guys,

The party is a over today as the stock is down 15%. It’s lost 77% of its value year to date, just in 2022, which is close to and Rivian territory .

So what’s going on?

I’ll just give you the short news on this.

The U.S. Securities and Exchange Commission is scrutinizing whether the company illegitimately let users trade digital assets that haven’t been registered as securities.

Additionally it has an insider trading scandal.

It’s clear that crypto is about to face more regulation.

Coinbase has or plans to lay off 1,100 employees or 18% of its workforce already just this year.

While FTX goes shopping, Coinbase looks like in serious trouble, Ripple spend hundreds of millions on legal fees in recent times.

Coinbase is a victim of its own success?

This SEC probe reportedly happened before and was separate from Coinbase’s alleged insider trading scheme that led to the fraud charges against an ex-Coinbase product manager and two other people. Coinbase’s reputation is hurting obviously.

Video.

There are tons of Altcoins that are of course securities.

Bitcoin and Ether aren’t, although I don’t necessarily agree with that. It’s a real grey area.

On Thursday, June 14, 2018, the U.S. Securities and Exchange Commission’s (SEC)  Director of Corporate Finance, William Hinman (Hinman), announced that the commission would not be treating Ether or Bitcoin as securities. How much lobbying did that take I wonder? Regulation in America is so corrupt.

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If you are going to go after Ripple, you have to go after Coinbase, Binance, FTX and the rest. You aren’t protecting consumers if you are not. But you need clear rules and actual regulation and not the free for all that the 1% have been using to grow their wealth in 2020 and 2021 even faster than usual.

So if you think about it, the argument over how to classify cryptocurrency tokens is controversial. Generally speaking, if cryptocurrencies are commodities (like other kinds of currency), they would governed by the Commodity Futures Trading Commission. But many crypto projects are funded by the sale of tokens whose primary value is speculative.

But they are all speculative. Let’s face it.

There is no middle ground here.

Ether didn’t scale and Bitcoin is not useful.

Coinbase can beg, but it has to measure up.

In a petition submitted on Wednesday, the exchange (Coinbase) -- which has clashed with the SEC in the past -- asks the regulator to clarify which digital assets it considers to be securities. The company also stresses the importance of establishing guardrails, given the market meltdown that has wiped out trillions of dollars and bankrupted several companies.

“The U.S. does not currently have a functioning market in digital asset securities due to the lack of a clear and workable regulatory regime,” read Coinbase’s petition.

Coinbase can hire good lawyers, but the entire crypto market needs firm regulation, this is getting dangerous.

Tokenomics and Rule of Law

How are all tokens not Securities? They won’t likely exist by 2040, at all.

Temp coins or altcoins come and go. It’s not an asset class if its just so speculative.

If you raise money from the public, you are a security, period.

Most new ventures in crypto and Web3 fail, many are scams, many don’t have real products.

ICOs to NFTs, it’s been just horrible to watch the mass-hypnosis, FOMO and deception all around.

I’m angry at Coinbase, angry at America that refuse to regulate, well anything. These Silicon Valley profiteers are just in it for the money.

Crypto is an underworld of trading schemes, pump and dumps, fraud and ponzi schemes. Nothing really has changed since 2009, but now the ultra rich play along too.

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Coinbase is unlikely to be the next Ripple. I’m sure they have covered their bases. But Binance and FTX will eventually disrupt them, if things keep going as they are.

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