This Week on Crypto Twitter: Outrage Over the SEC Crypto Crackdown
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Illustration by Mitchell Preffer for Decrypt
Many leading cryptocurrencies plummeted in price this week after the United States Securities and Exchange Commission launched high-profile enforcement actions against cryptocurrency exchange titans Binance and Coinbase for allegedly violating securities laws.
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The coins worst affected by the news were Solana, Polygon and Cardano, which were all labeled as securities offerings in the SEC’s Binance lawsuit.
Needless to say, it was a phenomenally busy week on the world’s favorite microblogging platform as people digested the news. Here’s how this pivotal week played out on Crypto Twitter.
On Monday, self-styled crypto sleuth @Leerzeit made an interesting observation. It should be noted here that former SEC director Bill Hinman in 2018 delivered a speech in which he explained his reasoning for why Bitcoin and Ethereum should not be considered securities.
The @SECGov has now removed Bill Hinman's biography from its website. Getting ready to throw him under the bus. pic.twitter.com/O7HCUGWSgt — Mr. Huber🔥🦅🔥 (@Leerzeit) June 5, 2023
Hinman’s speech recently became the subject of the SEC’s lawsuit against XRP progenitor Ripple, which was sued by the regulator for offering unlicensed securities. A court recently blocked the SEC’s motion to block access to documents related to this speech, saying the material was “subject to a strong presumption of public access.”
On Monday, the SEC sued Binance and in its filing listed several altcoins as securities. User @0xMert_ said the news was an industry call to arms.
seems the SEC thinks Solana, Cardano, Polygon, Cosmos, Algorand etc are ALL securities this gets Coinbase, Robinhood etc involved as well time to put the interchain bullsh*t aside and unite against the war on crypto the SEC is unhinged and must be stopped pic.twitter.com/Win17xRJOP — lightspeed mert | helius.dev (@0xMert_) June 5, 2023
Cardano creator Charles Hoskinson shared his two cents on the enforcement action in a lengthy tweet that was endorsed by Binance CEO Changpeng “CZ” Zhao.
🙏 "a perfect opportunity for the entire industry to set aside it's fragmented nature and unite for a common sense set of rules and guidelines" — CZ 🔶 Binance (@cz_binance) June 5, 2023
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Web3 law pundit James Murphy (a.k.a. MetaLawMan) wrote a thread about how the SEC’s complaint provided closure to an unresolved plot thread from 2021.
1/ The SEC complaint against @Binance appears to solve the mystery of why Brian Brooks abruptly resigned as CEO of @BinanceUS in 2021. CZ allegedly reneged on promises that Brooks would be given autonomy to run https://t.co/reBq6K7KAs independently from @Binance. — MetaLawMan (@MetaLawMan) June 5, 2023
On Tuesday, CZ apparently needed some public validation, and most of his followers obliged.
Who protects you more? — CZ 🔶 Binance (@cz_binance) June 6, 2023
Also that day, CNBC host Jim Cramer tried fanning the flames of a bank run on Binance, attracting comment from not one but two crypto CEOs.
🙏 we will see soon enough. — CZ 🔶 Binance (@cz_binance) June 6, 2023
Former Twitter co-founder/CEO and current Square CEO Jack Dorsey tweeted a controversial opinion about Ethereum.
Coinbase hit back against the SEC’s enforcement action on Tuesday with some counter propaganda with a natty bassline.
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Some revealing banter was passed between CZ and Gemini co-founder Cameron Winklevoss.
The U.S. Court of Appeals for the Third Circuit on Wednesday responded to a public petition that Coinbase had filed against the SEC way back in July, asking the regulator to clarify its rules on which digital assets constitute securities offerings. Coinbase’s Chief Legal Officer Paul Grewal tweeted about it.
Earlier tonight the Third Circuit issued a short order in Coinbase’s mandamus action today. The court noted the SEC’s suit against us this morning and asked the SEC whether that means the SEC has decided to deny our pending petition for rulemaking. The SEC has 7 days to respond. pic.twitter.com/8QXXoHJ07Z — paulgrewal.eth (@iampaulgrewal) June 7, 2023
Pro-crypto Senator Cynthia Lummis released a statement about the Coinbase lawsuit.
My statement on the SEC suing Coinbase, inc. https://t.co/5KNEM0IPSV pic.twitter.com/EgRIxrIcjj — Senator Cynthia Lummis (@SenLummis) June 6, 2023
Blockchain-savvy lawyer Jake Chervinsky accused the SEC of clutching at straws with its definitions of securities.
If the SEC's legal theories on investment contracts are right, then basically all luxury goods in existence—watches, sneakers, cars, handbags—are securities. The idea that the SEC should regulate markets for these goods is...I don't know how else to say it...pants-on-head crazy. — Jake Chervinsky (@jchervinsky) June 7, 2023
Analyst Adam Cochran wrote a very juicy multi-tweet thread summing up some of the SEC’s most incriminating evidence against Binance.
1/15 Evidence from SEC case against Binance including internal chat logs, first between Sam Lin (former compliance lead at Binance) and Alivn (previously head of BD) First is their convo about equity bonuses where Sam talks about risks of holding BNB pic.twitter.com/96IfwJEUOT — Adam Cochran (adamscochran.eth) (@adamscochran) June 7, 2023
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On Thursday, Crypto Twitter was hit by the bombshell that CZ and Gary Gensler have a history.
“Documents filed by the SEC on Wednesday indicate that attorneys from Gibson & Dunn and Latham & Watkins, one of Binance’s law firms, allege that Gensler offered to serve as an advisor to the crypto exchange in several March 2019 conversations with Binance executives and Zhao. He… — Frank Chaparro (@fintechfrank) June 7, 2023
CZ was busy trying to put out a fire that day.
This is simply false. Not sure if it's the journalist or the source. To the best of my knowledge, https://t.co/hSHrrlF7o7 had in total roughly $2 billion in user funds. This number in USD equivalent fluctuates a little as crypto prices change. And declining as users withdraw due… pic.twitter.com/5dBPRaaNZN — CZ 🔶 Binance (@cz_binance) June 8, 2023
On Friday, popular investing app Robinhood announced that it was delisting the coins listed as securities in the SEC’s Binance lawsuit.
BREAKING: @RobinhoodApp WILL AUTOMATICALLY SELL ITS USERS’ $SOL, $ADA, AND $MATIC IF THEY ARE NOT SOLD OR SENT TO OTHER WALLETS BY JUNE 27TH 6:59 PM ET pic.twitter.com/RXPh44zgYI — DEGEN NEWS 🗞️ (@DegenerateNews) June 9, 2023
Binance.US published a lengthy notice saying that it would be suspending dollar deposits and withdrawals as it transitions to a “crypto-only exchange.”
The SEC has taken to using extremely aggressive and intimidating tactics in its pursuit of an ideological campaign against the American digital asset industry. https://t.co/AZwoBOgsqS and our business partners have not been spared in the use of these tactics, which has created… pic.twitter.com/rlIe6swIoY — Binance.US 🇺🇸 (@BinanceUS) June 9, 2023
Finally, the weekend brought talk of another Saturday Bitcoin dump. Dubai-based "Titan of Crypto" was among many observers who cautioned against panic. "Each cycle this kind of thing happens," he wrote. "Whales love to dump it on the weekends."
#Bitcoin Time & Cycles ⏲️🌀 SEC news brought blood in the market, yet each cycle this kind of thing happens. It's nothing new in this wild market.
Whales love to dump it on the weekends.
If you're an investor, zoom out & don't get stuck in the lower time frames. 🤝
If you're a… pic.twitter.com/1eCn8dL8n6 — Titan of Crypto (@Washigorira) June 10, 2023
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Marketwatcher "Professor Few" also offered a long view of what might be happening.
is #bitcoin near a bottom and it's time to buy the fear? or is the dump yet to occur? short thread on what i currently see in the markets. 🧵 pic.twitter.com/ZPOqXeiYq4 — few (@fewseethis) June 10, 2023
Source: Decrypt
