Topic: The altcoin topic everyone wants to sweep under the rug - page 11. (Read 24383 times)

In the statement of facts https://www.fincen.gov/news_room/nr/pdf/Ripple_Facts.pdf which is linked form the FinCEN page I quoted the following quote is very relevant. Bold my emphasis. It does not say transfer for compensation. There are other violations involving exchange service etc mentioned in the document. The question is why is pre-mined even relevant here? The answer is the the guidance that I quoted above and which Ripple ignored. From the same statement of facts.


Edit: I would not touch a pre-mine without legal advice.

Good point. In connection with fraudulent transfer of money, FinCEN would have jurisdiction also. So in one example if a premine was fraudulent or connected with other fraudulent activity, then selling it for real money, would also be within FinCEN's jurisdiction perhaps.

I find that usually FinCEN is taking action when MSB registration and controls are not being done where they should have been. Thus I still think the SEC is the more likely regulatory body for fraudulent investment schemes.

Somewhat true but remember "money laundering" is expansive and includes transmission of money that is the proceeds of fraud or to facilitate fraud. As such Fincen's scope reaches anti-fraud and consumer protection, often in cooperation with other agencies.

FinCEN guidance doesn't not apply to the Howey test. FinCEN is not tasked with protecting unsophisticated investors from fraud. FinCEN's job is to fight money laundering.

The Howey test is more nuanced than that, and if a group is promoting a coin for investment purposes they may be culpable under the Howey test. I covered this in detail upthread.

All cryptocoins that being primarily distributed to speculators with no significant users of the currency, are at risk IMHO. That includes Monero and Aeon.


FinCEN came down on Ripple for being an exchanger and a centralized administrator that was processing money transfers for third parties without registering as an MSB and applying AML/KYC controls. The sales of XRP for fiat that are violations are because Ripple was also exchanging and also able to remove supply from the market.


I don't see any mention of Ripple being in violation because of sales of coins it gained during the time of distribution whether it be premine or otherwise. The mention of the premine was just a statement of facts, not a statement of a violation. It is the fact that Ripple was acting as an exchanger and centralized administrator that tainted any sales of XRP they made.

Disclaimer: I am not a lawyer and am merely offering my opinion for argumentative purposes. Readers, consult your own attorney.

In order to pass the Howey test an necessary but not sufficient condition is the presence of a centralized administrator as per the FinCEN guidance. In short the virtual currency must be centralized and not de-centralized. This centralized administrator is needed to to provide the "depending solely on the efforts of a promoter or third party." part of the Howey test. There are already examples in decentralized virtual currencies where "depending solely on the efforts of a promoter or third party." part of the Howey test has failed. Bitcoin: the XT vs Core debate. Monero: Replacing the initial developer with the current team. Dashcoin (not to be confused with Dash): The developer "sold" the coin and the community simply ignored the sale and continued as if nothing had happened.  

Giving away coins for free and keeping a portion of the pre-mine to fund development is exactly what Ripple did and FinCEN came down hard. This does make the issuer an MSB. https://www.fincen.gov/news_room/nr/html/20150505.html

ArticMine is correct that anyone that transferring money or money equivalents that is not for their own personal use is a MSB in terms of the FinCEN guidance. Period.

Any obfuscations Dash or BitShares try to claim won't help them escape culpability.

However I don't agree with ArticMine's claim that only the FinCEN has jurisdiction. FinCEN's jurisdiction is w.r.t. to money transmission, and the SEC has an orthogonal jurisdiction w.r.t. the Howey test for illegal unregistered investment securities (which was covered in detail upthread).

Please stop lying and misrepresenting. If we're going to continue this discussion I am going to demand your full name so I can have my lawyer contact you incase you choose to continue spreading lies and slander. Back up your own words now or stop lying.

This sounds like a healthy dose of common sense even of your a kid or noob etc.
Be careful out there guys.. all kinds of things could happen any time.

And NO TPTB_need_war since you asked i am NOT a girl LOL
I wish they got it made.. i'd find me a rich man  

 
  
Yes, project 'investors' and companies that outright scam their customers and fail to protect them.  
  
The SEC is very upset at shit this GAW and Paycon: http://www.coindesk.com/sec-files-suit-against-brother-of-gaw-miners-ceo-amid-investigation/  
  
I don't think they are going to take the time to go after programmers and moderators of communities of new currencies that clearly state the risk involved.  If I have ever made misleading statements (that weren't outright jokes) about any of the projects I am involved with, please refer me to them.  
  
The original bitcoin was treading on strange & unexplored ground, just like new altcoin currencies are treading on strange and unexplored ground.  That being said, so far US Government agencies have taken a suprisingly fair and refreshing stance on online currencies: as long as you are not hyping outright ponzis, selling shares in something that is clearly stated as a security, trying to deliberately scam money from people, or selling illegal things online they don't seem to mind.  
  
Both the FBI and the SEC should be commended for this - I can just as easily imagine a world where the hammer came down on every instance of "digital money" starting in 2011 and forced the whole movement underground for decades (where it would have still inevitably won, just on a longer time scale).  

Now just Chuck Rosenberg left to speak positively about Bitcoin so that we can free Ross.

Bitshares have made themselves legal in the eyes of the SEC by calling things what they are not.


They must have great lawyers to come up with that.

Nothing and absolutely nothing in her statements absolves culpability under the USA Securities law and Howey test.

You seem to completely misunderstand (and conflate) that statements about the potential of technology speak to nothing about legal implications of the rollout of technologies to investors.

Again I have warned you all that virtually all of the altcoins are ILLEGAL unregistered investment securities and by trading in them, you speculators are potentially setting yourselves up to be culpable, especially those of you who have prominent roles in the community and make statements about speculation.

Proceed at your own peril. And do consult your attorney, because IANAL.

To put this topic to bed once and for all, the head of the SEC, Ms. Kara Stein came out today and spoke positively of "blockchain technology".   
 
http://www.coindesk.com/sec-commissioner-kara-stein-blockchain-technology/

I didn't write that.


Observe and be schooled in marketing.


Investors don't use a currency. I told you that up thread, but now you make me repeat it again. Everything for you looks like a nail, because you've only got a hammer.


Actually it is quite the opposite.


And ~0 usership.


You need that advice, not me.

Ok,  ,  . 
 
Just.... please stop.  You're killing me.    
 
You're going to launch your coin and not tell anybody about it and try to avoid people knowing about it!? 
 
I'll tell you right now, removing the speculatory and early-adopter incentives from your coin is going to absolutely destroy any economic velocity it might ever hope to have.  If people are not incentivized to use your currency in increasing numbers, why would they ever start using it at all?  As well, the fact that you are going to make efforts to keep 'a lid' on the launch and creation of your coin is going to absolutely ruin any chance of people later growing interested in your coin (no matter how good the protocol).  By your logic, Bytecoin should be considered the 'true' implementation of Cryptonote since they claim to have had a 'token' for two years before it became public knowledge and people began speculating on it through exchanges.  Nevermind that no one had ever heard about it and 80% of it was mined by the time it was announced. 
 
Rethink your strategy, as well as your legal analysis of the situation.