SEC did not regulate security market (SIVB case) but want to regulate crypto

[dzungmobile]

What is SEC? [1]

It is the Securities and Exchange Commission (SEC)

The U.S. Securities and Exchange Commission (SEC) is an independent federal government regulatory agency responsible for protecting investors, maintaining fair and orderly functioning of the securities markets, and facilitating capital formation.

When SEC saw cryptocurrency market is too hot and grows up exponentially, they wanted to regulate it but forgot to regulate a market they are responsible for regulation and protect investor, the securities market.

Latest collapse of Silicon Valley Bank (SIVB) is an example of SEC failure in securities market. That collapse is big enough and a second biggest in the USA bank history. Weeks and months before the collapse of SIVB, many insider trades happened by their core team members from CEO, CMO, CFO to General Counsel but SEC did not know or ignored such.  

Before the collapse of Silicon Valley Bank, executives sold a lot of their shares. #SVBCollapse #SVB

Gregory Becker, CEO, sold 11% on Feb 27, 2023.

Michael Zucker, General Counsel, 19% on Feb 5.

Daniel Beck, CFO, sold 32% on Feb 27.

Michelle Draper, CMO, sold 25% on Feb 1.

See data from https://unusualwhales.com/insiders/trades?limit=50&%3Bticker_symbol=SIVB&ticker_symbol=SIVB

Some articles to read and discover the weird failure of SEC. [2, 3, 4, 5, 6, 7]

Chair of SEC, Gary Gensler should stop his derail from securities market to cryptocurrency market. In fact he should be fired.

[1] https://www.investopedia.com/terms/s/sec.asp
[2] https://www.bloomberg.com/news/articles/2023-03-10/svb-chief-sold-3-6-million-in-stock-days-before-bank-s-failure?leadSource=uverify%20wall
[3] https://www.cnbc.com/2023/03/14/svb-execs-sold-84-million-of-the-banks-stock-over-the-past-2-years.html
[4] https://www.cnbc.com/2023/03/14/svb-execs-sold-84-million-of-the-banks-stock-over-the-past-2-years.html
[5] https://www.cnbc.com/2023/03/14/sec-and-justice-department-silicon-valley-bank-investigation.html
[6] https://techcrunch.com/2023/03/14/regulators-are-taking-a-harder-look-at-those-insider-stock-sales-by-svb-execs
[7] https://news.coincu.com/173103-silicon-valley-bank-executives-sold-up-30/

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[_act_]

But this does not change that cryptocurrencies are security too, they are centralized and controlled by developers, they are using PoS and also premining some of the coins. Altcoins are securities.

Only the cryptocurrency that is not a security is bitcoin, bitcoin is a commodity because nothing like it was pre-mined, it is not using their PoS that is centralized and bitcoin is the most decentralized.

[SeeBiscuit]

Only the cryptocurrency that is not a security is bitcoin, bitcoin is a commodity because nothing like it was pre-mined, it is not using their PoS that is centralized and bitcoin is the most decentralized.

This is such a big detail that many people miss. bitcoin is in the same class of things as these:



Since bitcoin is a commodity, the SEC can't regulate it because it would be the same as them trying to regulate one of the other things in the list above.

It just doesn't make sense, and it's not even possible at this point. Then again, you have entities like the Food and Drug Administration who's regulation power effects the facilitation of certain food-based commodities.

[Anonylz]

Well it is very convenient for the sec to always shout out crypto regulation because it is not under the control of the government. Meanwhile, the so-called financial institutions were regulations are supposedly in place are Constantly facing huge problems. Who are they deceiving.
Perhaps they should try and introduce decentralization to all the financial institutions to avoid these recurring issues.

[Z-tight]

Perhaps they should try and introduce decentralization to all the financial institutions to avoid these recurring issues.

The sec is a centralized agency, how can they or the U.S government introduce decentralization. The decentralized options are available for persons and institutions to use, though the government and their centralized agencies do not like them.

The collapse of Silicon Valley bank and Signature bank is similar to what happens in centralized crypto exchanges, their users feel these institutions have reserves to cover a bank run or a massive withdrawal, but they do not, they function through a fractional reserve system, and what you see in your account, or address is just digits, as your money has been used for trading or to buy high or low risk assets. If whatever trade these institutions use your money for fails, then withdrawal is only possible for a few people, and the many who could not withdraw their money have to wait for a long and hopeless law proceeding.

[buwaytress]

I'm not in love with regulators, let me just say that first.

But the SEC's failure to foresee the banks' crash doesn't mean they didn't regulate. The fact they swooped in and took over another bank after SVB proves they are doing (some of) their job as a regulator. The punishments that come later, and the protections of customer deposits to come, that's also what you do get with regulation.

I think it's pointless for them to want to regulate decentralised networks like Bitcoin -- they already know this. What they do want to regulate is crypto businesses -- which is anything but decentralised. The problem I have is them wanting to determine who can use crypto and how they must use it, but I actually think because the majority of users don't have enough knowledge or information, the mainstream consumer is probably better off having the protections of regulation.

For the rest of us who want to use Bitcoin as it should, little of this affects us anyway, other than to inconvenience us heh.

[Flexystar]

Interesting to know that SEC is not working that effectively these days. All their bragging about having security against investors is such mess and laughable thing right now. They should be shifting their focus on centralised banks rather than decentralised market. Because decentralised market was doing just fine way before the interference of SEC authority. Literally reminds me earlier days when the news was all about how bitcoin is going up and down, we were chilling over beer and making good profits as we hodl. SEC came in and made a mess of everything by imposing unwanted regulations. I find it pitying.

[Gyfts]

I'm not in love with regulators, let me just say that first.

But the SEC's failure to foresee the banks' crash doesn't mean they didn't regulate. The fact they swooped in and took over another bank after SVB proves they are doing (some of) their job as a regulator. The punishments that come later, and the protections of customer deposits to come, that's also what you do get with regulation.

I think it's pointless for them to want to regulate decentralised networks like Bitcoin -- they already know this. What they do want to regulate is crypto businesses -- which is anything but decentralised. The problem I have is them wanting to determine who can use crypto and how they must use it, but I actually think because the majority of users don't have enough knowledge or information, the mainstream consumer is probably better off having the protections of regulation.

For the rest of us who want to use Bitcoin as it should, little of this affects us anyway, other than to inconvenience us heh.

There are talks that some regulations that were rolled back from Dodd-Frank caused the SVB collapse but there isn't a single regulation that would have allowed for banks to invest money onto the market and prevented the bank run. The bank collapse is a byproduct of a fragile U.S. economy that has put all its eggs in one basket to stop inflation which is inflation rate hikes.

There's market risk in every investment so I don't see how it's feasible for regulators to regulate out inherent risk. To the extent the FDIC will do what they're obligated to do is the only hope I have for the government to step in. Uninsured creditors should not be bailed out.