[yrral]

Here is SEC commissioner Hester Peirce's dissenting opinion:

https://www.sec.gov/news/statement/peirce-blockfi-20220214

Essentially she says that while they did misrepresent the over collateralization, a 100m fine is too much since they did fulfill their end of the loans.

Additionally, she says that the categorization this stuff as securities is not effective. US consumers want interest on their crypto-assets now, but with companies having to jump through complicated SEC hoops this type of product will not be available in the near future (or maybe never available); not because of "customer protection" issues but because of sec over-regulation issues.

[Comevius]

She always gives a partisan, anti-regulation opinion in these. She says that cryptocurrencies need new rules, but she never elaborates. She wants to keep the barrier of entry low while having meaningful protection for customers. Without regulation or oversight. How? Nobody knows. She doesn't either.

[kkielhofner]

In the rotating door that is regulators and the industries they regulate she’s going to end up at a crypto company.

[chernevik]

BlockFi has already blown its chance to provide full and reliable information on its own. The complaint here isn't that BlockFi made full disclosure but just forgot to check the S-1 box. The disclosures they have made were _false_. They wouldn't be paying $100mm otherwise.

And it doesn't matter whether BlockFi has paid its loans so far. If misrepresentation of collateralization is penalized only when loans aren't paid, then it can never be penalized at all.

I can easily believe that US accounting practices have problems with crypto; do we even have GAAP for this stuff? And it's easy to complain that SEC filings are complex and time-consuming. But at the end of the day there must be some sort of accounting of how these companies and products work.

I suspect that a lot of crypto products won't meet SEC disclosure requirements because they can't meet any real disclosure requirement. And if that's right, then no, they shouldn't be available.