SEC announcement 3rd December 2020

[Bergkampsballs]

Hi,

I understand that the SEC are going to make some regulatory announcements on the 3rd of December, there's been a lot of rumours flying about as to what they may be and Coinbase CEO Brian Armstrong has made clear his concerns that it's bad news for Crypto.

https://www.sec.gov/spotlight/investor-advisory-committee-2012/iac120320-agenda.htm

https://www.coindesk.com/coinbase-ceo-trump-administration-may-rush-out-burdensome-crypto-wallet-rules

https://twitter.com/brian_armstrong/status/1331744884856741888

"Last week we heard rumors that the U.S. Treasury and Secretary Mnuchin were planning to rush out some new regulation regarding self-hosted crypto wallets before the end of his term. I'm concerned that this would have unintended side effects, and wanted to share those concerns."


I was hoping to discuss this announcement, what people think the chances are that the rumours are true and the immediate short term and longer term impacts on the price of Bitcoin and other Cryptocurrencies. Does this have the potential to trigger an immediate sell off?

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[Bergkampsballs]

This announcement is happening soon, will it have an effect on the price of Bitcoin, XRP or any other coins?

[mmcsm]

Thank you for this information, I did read this at some point but I thought it's so strange.
Seems that US wants to get all the decentralized wallets verified, isn't this all against what crypto is all about?
I think that Brian Armstrong and that as he mention, it "would be a terrible legacy and have long-standing negative impacts for the U.S."
if this is not applied worldwide, them it's just going to be negative to US..wouldn't you agree?
Let's see, let's hope that this is not approved and that we have some brilliant mind in the meeting today that is able to explain what this is about to whoever is going to decide.

[Yogee]

You can remove the extra characters in that link and it will direct you to the same tweet.

Code:

https://twitter.com/brian_armstrong/status/1331744884856741888

https://www.sec.gov/spotlight/investor-advisory-committee-2012/iac120320-agenda.htm

It's about a "Panel Discussion Regarding COVID-19 Implications for Next Proxy Season" so I don't understand how the rumors on regulations of non-custodial wallets became part of this.

...I was hoping to discuss this announcement, what people think the chances are that the rumours are true and the immediate short term and longer term impacts on the price of Bitcoin and other Cryptocurrencies. Does this have the potential to trigger an immediate sell off?

Impact on the price? maybe little. The possible impact would be,
- wallet developers being identified by regulators
- regulators asking these wallet developers any information about their users

If you're that worried whether a regulation asking information about these wallets will be implemented then you should probably start learning about decentralized exchanges.

Would it trigger a sell off? I doubt that. I don't really know if any of these whales are concerned about their privacy or not. Most of them probably sell on centralized exchanges [OTC] and give their personal information. Some are most likely trading P2P or using DEX like Bisq for a long time.

[Jating]

The Brian Armstrong announcement had already taken it's effect on the market already that's why we have seen it plummeting to $16k. But since then, everything has settled down price seems to recovered on the 27th and now fluctuating to as high as $19,800 or so (there have might news that we have touch a new all time high).

It's already December 3rd today, no news from SEC, so I guess we won't hear anything as @Yogee has pointed out, it's about Covid-19 and has nothing to do with this so called custodial wallet regulations that Brian twitted.

[celot]

When this announcement update by SEC? how long have take time because when SEC give announcement always make bad impact for bitcoin price going down but with this announcement still nothing change with bitcoin price, maybe right now not effective with SEC announcement again after many time SEC make problem with cryptocurrency, how many time SEC make new project become die after get cases with SEC and much money gone after some ICO coin have faced problem with SEC, will all investor money from ICO project take by SEC and without refund for investors?

[jseverson]

Impact on the price? maybe little. The possible impact would be,
- wallet developers being identified by regulators
- regulators asking these wallet developers any information about their users

If you're that worried whether a regulation asking information about these wallets will be implemented then you should probably start learning about decentralized exchanges.

I don't think developers have anything to do with it:

“This proposed regulation would, we think, require financial institutions like Coinbase to verify the recipient/owner of the self-hosted wallet, collecting identifying information on that party, before a withdrawal could be sent to that self-hosted wallet,” Armstrong tweeted.

It's just a bunch more KYC that means if you're going to withdraw BTC from your Coinbase (or whatever regulated exchange) account to whatever wallet, you're going to need to prove who owns that address first, regardless of whether it's custodial or decentralized.

Either way, I kind of feel like this is a worst case scenario kind of thing -- I simply don't see how they can implement this effectively. Even then, you could just prove ownership of some random Electrum wallet, then send the coins from there without restrictions. It's just going to be a bunch of red tape with very easy workarounds.

[milani]

It is a pity in case those rumours will become the reality some day. Too many not good nuances may appear in using crypto currency for lots of people. Hope those bad scenario will not be fulfilled. It might substantially limit some sort of freedom of action. Or people will have to create something new, that will be able to circumvent of regulations and limitations.

[Yogee]

....
I don't think developers have anything to do with it:

“This proposed regulation would, we think, require financial institutions like Coinbase to verify the recipient/owner of the self-hosted wallet, collecting identifying information on that party, before a withdrawal could be sent to that self-hosted wallet,” Armstrong tweeted.

It's just a bunch more KYC that means if you're going to withdraw BTC from your Coinbase (or whatever regulated exchange) account to whatever wallet, you're going to need to prove who owns that address first, regardless of whether it's custodial or decentralized.

Either way, I kind of feel like this is a worst case scenario kind of thing -- I simply don't see how they can implement this effectively. Even then, you could just prove ownership of some random Electrum wallet, then send the coins from there without restrictions. It's just going to be a bunch of red tape with very easy workarounds.

Another KYC for their users who already submitted personal information to them? Or is it like asking them to sign a message from the non-custodial wallets? Maybe they will also ask for a picture of users next to their mobile phone or computer where the address is showing hehe.

I agree with the red tape and easy workarounds. It's a waste of time and money on the part of regulators. It's just an added hassle to centralized exchanges or services.

[Walterhank]

I don't see this impacting bitcoin in the short or long term but it can if new regulations surfaces.

[jademaxsuy]

At first, I do like bitcoin to be regulated by the government and that it should be watch over for the safety of the investors. But after a long realization bitcoin is good without regulations. It may going to modify bitcoin features like having the KYC and will be controlled by the third party services especially most likely to happen will be implementing the increase of transaction fee for your protection against bad people. Yet, I know their protection will not be guarantee and probably will work only on big investors or the whales. They will not going to be busy chasing on small losses of bitcoin investment for they can't earn on it.