U.S. SEC targets crypto 'staking' with Kraken crackdown

[blue-wave]

Source: Reuters via MSN

-Crypto exchange Kraken agreed to shut down its cryptocurrency staking service and pay $30 million in penalties to settle U.S. Securities and Exchange Commission charges that it failed to register the program, the agency said on Thursday, in a move that could cause headaches for platforms with similar offerings.

The settlement marks the SEC's first crackdown on staking, a common service offered at both centralized and decentralized crypto exchanges, including most of the major exchanges in the United States such as Coinbase and Binance US.

Read more: https://www.msn.com/en-us/money/companies/us-sec-targets-crypto-staking-with-kraken-crackdown/ar-AA17iUVj

---

Staking your digital currency is like earning interest on your money from the bank. The yield on crypto was high, some around 20%, as opposed to the fraction of a percent you get today from banks. The American consumer loses here. This settlement only applies to the U.S.

[mathematic]

1. Are you for real? These are ponzis. Numerous crypto yield scams have collapsed in the last year

The fact that you're comparing unregulated crypto schemes with legitimate banks that are regulated and must maintain assets in excess of their liabilities to ensure the safety of customer deposits is clear enough reason to believe that the SEC should crack down on this.

Kraken itself should be completely shut down. They're not in compliance with IRS reporting. They're helping their customers cheat on their taxes.

[blue-wave]

2. Yes, I am for real

There are many companies and individuals in the digital currency industry advocating for regulation. As an individual, I also advocate for such regulation.

As for schemes, should we talk about the Madoff ponzi scheme? Hmmm, seems to me that digital currency had nothing to do with that one. Or how about the financial crisis (total system collapse?)back in 2006,2007,2008, etc? Hmmm no crypto currency there. Don't even get me started on Wall Street and all the scandals of the past.

Crypto is a new technology, there will be issues along the way just as there was with the advent of the internet. But it will be in our future financial system. Let's sort it all out, but regulation by enforcement through lawsuits is not the way. Let government and the industry sit down and hammer out intelligent solutions.

BTW, do you have any links for all of your accusations above?

[muriel_volestrangler]

3. Your understanding of basic economics is not for real, then

A "return" of 20% is not low-risk, and so cannot be sensibly compared to interest from banks. If people like you have been persuaded that it can be, that shows the cryptocurrency speculators need further regulation, to stop them spreading dangerous misinformation like that.

What has happened in this case is regulation. You claim you want it sorted out, but now holler when that regulation is enforced. If it's not done through the law, then your "intelligent solutions" will turn out to be the speculators ripping off anyone they can.

Please do not imagine there is anyone in the cryptocurrency "industry" that has an aim of producing an "intelligent solution" that helps other people. It's about people making money for themselves, and nothing more.

[blue-wave]

5. I find it amazing that people

who know nothing about me, attack me for having a position different than their own.

"Your understanding of basic economics is not for real" "If people like you have been persuaded that it can be" People like me? Come now. I thank you for your concern, but you have no idea as to my "understanding" of anything. Demeaning, degrading and attempting to stigmatize someone does not win arguments. But you can rest assured, your attempt at stigmatization in this instance, has failed.

If you would do just a wee bit of research on crypto regulation in the world, you will find that there are countries who have implemented sensible "intelligent" regulation for the digital currency market, all without expensive, lengthy and company devastating lawsuits.

[muriel_volestrangler]

8. We have an idea of your understanding of economics from your OP

in which you likened the promised 20% return on staking to the interest on a savings account. That shows you haven't grasped the basics of investing.

How do you think regulation works, if the companies who break the rules can't be taken to court and fined? The length and expense was, of course, Kraken's choice - they could have stuck to the rules, or admitted to the wrongdoing as soon as they were caught. The amazing thing is that you characterise a fine for a company breaking regulations as a loss for consumers.

[blue-wave]

9. "We"? Or do you mean you?

If it’s we, please advise on who the we is. And no, you are completely mis-characterizing my position. Please stop. I advocate for regulation too. Just not how it’s presently being done.

[Miguelito Loveless]

4. Madoff went to prison

and so should many of these crypto-schemers. Not sure of your point here. No one is claiming that ponzi schemes don't happen with real financial institutions.

I don't see crypto as the future of finance. The future of money laundering and other illegal activities, possibly.

[blue-wave]

6. "The future of money laundering and other illegal activities"

And as to my point, there has never been money laundering or Illegal activities in other financial industries? Come now, the digital currency market is certainly not immune to this, but neither are other financial institutions. So why the focused attack on digital currency?

As to the future, well just check out what the big boys on Wall Street are doing:

Bank of New York Mellon Corp. traces its history back to 1784 and Alexander Hamilton. But even this venerable institution is finding the lure of the crypto world too strong to resist.

Despite all that’s gone wrong in the industry, with trillions in losses, spectacular bankruptcies, the arrest of Sam Bankman-Fried — the world’s largest custodian bank and other financial giants are hoping to expand in crypto — not shrink.

Link: https://finance.yahoo.com/news/wall-street-giants-spy-opportunities-172324093.html

[muriel_volestrangler]

7. Well, let's be transparent, and quote what the bank says

“This will continue to be a focus for us, not so much for crypto, but really the broader opportunity that exists across digital assets and distributed ledger technology,” Robin Vince, chief executive officer at BNY Mellon, said this month on a call discussing earnings. “If anything, the recent events in the crypto market only further highlight the need for trusted regulated providers in the digital-asset space.”

A spokesperson for the company said it believes in the “transformative potential” of blockchain, with its ability to improve accuracy of record-keeping, handling of certain asset types such as real estate and loans, as well as more efficient settlement.

So, yeah, more regulation needed. And they're thinking more of the blockchain technology, not cryptocurrencies.

[blue-wave]

10. Ugh!!!

Please read response #9. And an FYI. Blockchain technology, crypto currency and digital assets are all part or parts of the technology. It’s all tied together.

[muriel_volestrangler]

11. No, cryptocurrency is not part of blockchain.

Blockchain is part of cryptocurrency. And staking is not part of blockchain. Blockchain technology can be used without people speculating with their money - which is what the regulation in the OP (which you object to) is about.

Stop trying to sell cryptocurrency as technology, or staking as comparable to a savings account. People shouldn't believe such claims.

[blue-wave]

12. Either you just love

To twist my words or truly don’t understand the crypto space. If you don’t understand it, please take a basic course on the subject matter.