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Author Topic: SEC Charges Bitcoin Savings and Trust (BTCST) as Ponzi Scheme  (Read 23979 times)
matuszed
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July 23, 2013, 04:44:52 PM
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https://www.sec.gov/servlet/Satellite/News/PressRelease/Detail/PressRelease/1370539730583#.Ue6zJo1WZ8F

"Markets can remain irrational longer than you can remain solvent." -Keynes
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July 23, 2013, 04:51:05 PM
 #2


About time!

I'm not a Coinbase fan -- I placed a buy order, they took the funds out of my account, then a week later the price went up and they canceled the buy and closed my account.  You've been warned.  Use a different exchange.
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July 23, 2013, 05:01:12 PM
 #3



Excuse me Mr. Pirate, the Bitcoin Police would like a word with you!

And don't forget to bring in your accomplice, Payb.tc.


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July 23, 2013, 05:04:21 PM
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I figured this was going to show BTC in a somewhat negative light, but it seems that it's a good step towards mainstream adoption that the SEC regards virtual currencies as similar to fiat currency in a situation like this (though he did cash a good deal of it out to USD)
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July 23, 2013, 05:06:54 PM
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Trendon?

Reputation https://bitcointalk.org/index.php?topic=198808.new#new
Tip: 1CtNCGTyhVkp6AzRwhTsqjkWgwCqk1vSjA
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July 23, 2013, 05:09:07 PM
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What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

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July 23, 2013, 05:27:04 PM
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What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You may be selling securities in violation of the Securities Laws.

Marco Santori is a lawyer, but not your lawyer, and this is not legal advice.  If you do have specific questions, though, please don't hesitate to PM me.  We've learned this forum isn't 100% secure, so you might prefer to email me.  Maybe I can help!  Depending upon your jurisdiction, this post might be construed as attorney advertising, so: attorney advertising Smiley
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July 23, 2013, 05:33:29 PM
 #8

What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

any comment for those of us on the investor side of the equation? i.e. folks that are purchasing stocks, bonds, etc on these exchanges?

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matuszed
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July 23, 2013, 05:35:11 PM
 #9

What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

Yea the only thing I think that might be a saving grace is are any of these listed securities worth the SEC's time.

"Markets can remain irrational longer than you can remain solvent." -Keynes
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July 23, 2013, 05:38:21 PM
 #10

Dear BTCT, Bitfunder, Mpex, icbit, et. al..... get ready for a visit from the SEC.
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July 23, 2013, 05:40:47 PM
 #11

What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

Yea the only thing I think that might be a saving grace is are any of these listed securities worth the SEC's time.

Roughly speaking, how would an exchange "come into compliance" quickly?
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July 23, 2013, 05:42:32 PM
 #12

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

Not everyone is as eager as you to lick the boots of the authoritarian state. 

Of course as a lawyer you depend on sniveling cowardice in the face of centralized coercion to make money, so no real surprise there.

Many bitcoiners, being agorists, are explicitly dedicated to using the free (so-called 'black') market to undermine and eventually overtake the oligarchs' crony pseudo-capitalist economic structures.

We will not comply.  We will live as free men and see who has a problem with that.  Then come the assassination markets...


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Monero
"The difference between bad and well-developed digital cash will determine
whether we have a dictatorship or a real democracy." 
David Chaum 1996
"Fungibility provides privacy as a side effect."  Adam Back 2014
Buy and sell XMR near you
P2P Exchange Network
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July 23, 2013, 05:49:34 PM
 #13

What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

This may come as a surprise to you but US law is irrelevant outside the US and these exchanges are not US based.
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July 23, 2013, 05:51:16 PM
 #14

What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

any comment for those of us on the investor side of the equation? i.e. folks that are purchasing stocks, bonds, etc on these exchanges?

I don't live in the US and I'm not using US based exchanges. What more is there to say?
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July 23, 2013, 05:52:13 PM
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What do you think about the chances they will charge everything on BTCT as illigal investment offerings?

I think they are pretty good, actually.  From the attendant Investor Alert:

"the fraud may also involve an unregistered offering or trading platform"

and, here's the real kicker:

"Any investment in securities in the United states remains subject to the jurisdiction of the SEC regardless of whether the investment is made in U.S. dollars or a virtual currency. In particular, individuals selling investments are typically subject to federal or state licensing requirements."

I have, of course, counseled my clients on this point for some time.  Looks like I was right.

Attention Unregistered Exchanges, Perpetual Mining Bonds (PMBs), REITs, and other members of the Bitcoin investment space: The SEC has explicitly indicated its intention to apply the already-existing laws to your security.  You are selling securities in violation of the Securities Laws.  Come into compliance, and do it quickly.

Yea the only thing I think that might be a saving grace is are any of these listed securities worth the SEC's time.

Roughly speaking, how would an exchange "come into compliance" quickly?

I don't think "SEC" and "quick compliance" really go hand in hand.
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July 23, 2013, 05:55:49 PM
 #16

Roughly speaking, how would an exchange "come into compliance" quickly?

There is no clear path to compliance.  That would be too easy and not allow for maximum extraction of rent via duress under color of law.

"Come into compliance" is code for 'play ball or else.'

This is nothing less than an extortionist demand for the low friction Bitcoin economy to move backwards, and mimic the gross inefficiencies in the hyper-regulated dying world of fiat trash.

The putative regulatory agency in question, the SEC, has been deeply captured by the very entities it was supposed to be keeping under control.

Bitcoin and its efficient markets represent an existential threat to those rent-collecting entities.

"Give us silk-suited thugs of the lawyer mafia all your profits, or else we'll use our guns and tanks to hurt you" is the bottom line
here.

The question is whether we accept these initiations of force like slaves, or retaliate in self-defense in the manner of Bitcoin-empowered sovereign individuals.


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Monero
"The difference between bad and well-developed digital cash will determine
whether we have a dictatorship or a real democracy." 
David Chaum 1996
"Fungibility provides privacy as a side effect."  Adam Back 2014
Buy and sell XMR near you
P2P Exchange Network
Buy XMR with fiat
matuszed
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July 23, 2013, 05:59:19 PM
 #17

Shouldn't the recent lift of the ban of general solicitation cover exchanges such as these to a degree?

"Markets can remain irrational longer than you can remain solvent." -Keynes
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July 23, 2013, 05:59:22 PM
 #18

I've softened my post a bit with some stealth-editing.  The message remains the same, though: Unregistered exchanges servicing US customers are not flying under anybody's radar.  US entities issuing "securities" aren't either.  None of this is "virtual" from the SEC's perspective. An investment is an investment.  Denomination in BTC does not exempt it from such.

Marco Santori is a lawyer, but not your lawyer, and this is not legal advice.  If you do have specific questions, though, please don't hesitate to PM me.  We've learned this forum isn't 100% secure, so you might prefer to email me.  Maybe I can help!  Depending upon your jurisdiction, this post might be construed as attorney advertising, so: attorney advertising Smiley
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July 23, 2013, 05:59:58 PM
 #19


This may come as a surprise to you but US law is irrelevant outside the US and these exchanges are not US based.

Look at Liberty Reserve for how well that argument worked out for them.
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July 23, 2013, 06:02:02 PM
 #20

I've softened my post a bit with some stealth-editing.  The message remains the same, though: Unregistered exchanges servicing US customers are not flying under anybody's radar.  US entities issuing "securities" aren't either.  None of this is "virtual" from the SEC's perspective. An investment is an investment.  Denomination in BTC does not exempt it from such.

Who exactly are these "Unregistered exchanges" and "US entities" you are talking about?
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