[pietjepuk88]

But what _is_ the reason they can't get through the pipeline (and that you think is a "very good" one)? Isn't just the SEC saying "We don't feel like answering your request. Continue as you see fit, but we can't promise we won't come after you for whatever reason"?

[Nursie]

I shall refer you to my first post up there!

> the massive risks and manipulation inherent in the ecosystem, making it effectively impossible to "provide full, fair, and truthful disclosure and investor protection"

I don't know for sure, as I don't work for the SEC, but it certainly seems likely that if cryptocurrency-centered securities aren't getting through the registration process, it's likely because cryptocurrency and cryptocurrency asset prices are inherently massively unstable, subject to manipulation by unknown forces uses both fair means (large currency and cryptocurrency hodings) or foul (looking at you tether), and in general it's probably not possible to provide such a disclosure or any real evaluation of risk.

And that's if the players involved are honestly attempting to do that, many/most players in the crypto space seem to be cowboys.

> Isn't just the SEC saying "We don't feel like answering your request. Continue as you see fit, but we can't promise we won't come after you for whatever reason"?

No.

The SEC is saying that these schemes are securities, and you categorically cannot operate unregistered security schemes. The SEC is saying that these things must be registered, and until/unless they are registered they must stop.

This one commissioner is then saying "But that's not fair because we don't see crypto security schemes getting through the securities registration process".

I don't think she's wrong, they probably aren't getting through even if they do apply, but I also don't think the denial is wrong - it seems highly unlikely they can meet the criteria.

And dear god no, we should not be carving out exceptions to the securities laws for crypto-hucksters to get easier registration status without having to meet the same bar for honesty, transparency and investor protection as 'traditional' finance schemes.

[PretzelPirate]

> This one commissioner is then saying "But that's not fair because we don't see crypto security schemes getting through the securities registration process".

This appears to be a misrepresentation of Peirce's statement. She isn't saying that it's not fair that the SEC isn't letting these things get approved, she's claiming that the SEC isn't doing its job and isn't providing clarity on why they aren't getting approved and how they can get approved in the future. Clarity can be as simple as "we beleive that the volatility makes crypto offerings too risky", but they're instead making one-off settlements and vague statements.

There have been crypto products that were held in limbo for years without clarity on why they were being rejected by the SEC, which is irresponsible on their part.

[pietjepuk88]

> I shall refer you to my first post up there!

No, that's what _you_ think the reason is or should be. I'm asking what the reason (or answer) is that the _SEC_ gives in the application process.

> The SEC is saying that these schemes are securities, and you categorically cannot operate unregistered security schemes. The SEC is saying that these things must be registered, and until/unless they are registered they must stop.

My question was about the registration. If you _want_ to register, and the SEC replies with "<silence>", what are you supposed to do? Or if you ask if you should register, and get met with silence. I don't disagree with your assessment of "The SEC is saying that these schemes are securities", but instead of answering the question upfront they seem to prefer to punish/fine after the fact. Worst of all, they ban Kraken from ever offering any staking services in the future, even _if_ there is/will be a legal way to do it.

I _understand_ Gary's SEC's stance of keeping everything deliberately vague that way, because it gives him a lot of power to punish and discriminate on a one-off basis. I agree with Peirce (and CFTC's Pham) that's it's a bad and very lazy way to "regulate" (air quotes) though.

[Nursie]

> If you _want_ to register, and the SEC replies with "<silence>", what are you supposed to do?

Not start selling your unregistered scheme! That's the point here, in terms of what actions you are allowed to take, if you don't have registration, you cannot sell the security.

It's not that they 'prefer' punishing after the fact - there's not supposed to be a fact.

Your options are to walk away or find some way to get them to take action. Your options do not include "fuck it we'll just go ahead and see if it bites us".