[TrapLord_Rhodo]

It's wierd tho because it's not ENTIRELY tone-deaf. When i was reading it i would agree wholehearitly with some, and wince at others.

If he would have left it at these two points and immeditaly called a company all hands:

>First of all, if you want to do a vote of no confidence, you should do it on me and not blame the execs. Who do you think is running this company? I was a little offended not to be included :)

> Our culture is to praise in public, and criticize in private. Posting this publicly is also deeply unethical because it harms your fellow co-workers, along with shareholders and customers.

[blueben]

"Please don't make this public, because then the investors will find out and they'll come after me."

[slenk]

Notice shareholders comes before customers

[RickHull]

Yes, Coinbase has a fiduciary duty to their shareholders that does not exist for customers.

[gamblor956]

No, Coinbase does not have a fiduciary duty to its shareholders that trumps its obligations to its customers.

Or to put it this way: if Coinbase goes bankrupt, customers have priority for Coinbase's assets over its shareholders.

[iudqnolq]

Nope.

> But wait, you bluster, the custodial agreement clearly says that I am the owner, that it’s my property, that I retain title to it. Yup, but that’s not how the law actually works. Just because they wrote that doesn’t mean it’s true.

> In fact, the exchanges are lulling the consumers with language claiming that the consumer "owns" the coins, when in fact the legal treatment is quite likely to be different in bankruptcy. In bankruptcy, it is likely to be treated as a debtor-creditor relationship, not a custodial (bailment) relationship.

> Not only are the customers likely mere creditors, but they are also likely general unsecured creditors, which means they will have to wait at the back of the line for repayment with everyone else. They will share on a pro rata basis whatever assets are leftover (if any) after the secured creditors and the priority creditors (including the expenses of running the bankruptcy) get paid, and any payment might not be for quite a while. That’s not a happy to place to be. Recoveries could be pennies on the dollar.

https://www.creditslips.org/creditslips/2022/02/what-happens...

[gamblor956]

Nope.

Your citation refers to the status of customers with respect to other creditors.

It says diddly squat about shareholders, who are below creditors in the event of a bankruptcy. Because, in a corporate bankruptcy, shareholders generally lose their investment.

[iudqnolq]

Yes, I got that wrong.

Absent bankruptcy, fiduciary duty to shareholders is prioritized over creditor's interests. In bankruptcy, customers will be screwed over to benefit the other creditors, not to benefit the shareholders as I mistakenly said.

[dvt]

Awesome blog post, thanks for sharing.

[Nowado]

Do you think this is some kind of financial institution and not just a chill, simple company moving around records on a ledger? : )

[sokoloff]

The amount of likely harm to shareholders is greater than the amount of likely harm to customers from this action.