> A federal judge ordered Ripple to pay $125 million in civil penalties and imposed an injunction against future securities law violations on Wednesday.
What does an injunction against future violations mean? Why would that be weightier than the criminal legal code? Shouldn't such an injunction be assumed by pretty much everybody doing anything?
"Alright, stop what you're doin' 'cause I'm about to ruin."
Seems to me that this is a fast changing space of product offerings vs adaptation of regulations. Some transactions violated, some did not. Some planned future Ripple developments could cross the line. Seems that Ripple just needs to continue working the system, so the regulations catch up and give the entire space some guidance on what they can and can't do.
Overall a positive development. The penalty was reduced from something like 2Bs and XRP jumped 20% on the news.
A lot of these things don't have serious consequences attached to the rule, so by ordering the party to comply they get the penalties of contempt attached.
The time behind bars seems wrong on many levels but I'm having a hard time understanding/sympathising the guy's position beyond the "contempt of court is a poor fit for assigning punishment for this kind of thing and you can't just keep someone locked up on suspicion they did something wrong you have to use a real pre-existing law and prove it".
Losing your entire fortune isn't impossible by any means, even coincidentally right when your wife announces she wants a divorce, but you'd think he'd have a more forthright explanation for why there is no record (person, investment contact, business record on the other side, etc) to point to anywhere for his 2.5 million dollar exchange. The only reasons I can think to not are ones that also explain why he'd rather take contempt of court charge than say what happened (illegal investments, purposefully losing the money, hiding the money, trying to do one of these things and being conned). For that reason I definitely feel the guy shouldn't have been jailed but I don't really feel bad for the guy as in he got screwed by bad luck or something.
I'm curious what sort of bad investment he made that left no paper trail as to where the money went.
Did he have no evidence whatsoever? Or was the evidence unconvincing?
The judge who released him also noted that they believed Mr. Chadwick could pay the owed amount but that it was clear keeping him in prison wasn't going to make that happen
Yes, but you more or less cannot extradite for contempt. So, this penalty is mooted if they simply take the billions they've extracted from the general public and relocate to another country.
It’s poorly written. The injunction is against further institutional sales (what they were accused of possibly doing in a way that was illegal) with out explicit review per sale.
It’s doubly confusing because the decision protects the weak, helpless institutional investor while leaving the ruthless sharks that are retail clients to fend for themselves.
There is a whole world of securities law that’s hidden behind client attorney privilege that each client uses to protect themselves from the SEC (and DOJ), but basically nothing has been surprising about how the SEC has fumbled in the crypto cases or in what the courts have ruled
and of people familiar with this dimension of yet unchallenged securities case law, this has been one of the criticisms of the SEC:
Nothing the SEC does can accomplish investor protection in the crypto markets.
Nothing the SEC does can accomplish the mission Congress set for it, in the crypto markets.
There are ways to leverage blockchain transparency for real time disclosures far beyond what is seen in the stock market, and investors already have choices in sticking with offerings that leverage onchain transparency better. A concept of government can help standardize this approach to help capital formation.
SEC enforcement on the teams and exchanges will only harm investors in liquidity and price discovery. I would say that the SEC making itself known has improved the quality of crypto offerings, but there is still a far better approach possible.
> There is a whole world of securities law that’s hidden behind client attorney privilege that each client uses to protect themselves from the SEC (and DOJ)
The only point is that the SEC hasn’t done anything unpredictable in which offerings they’ve chosen to go after, despite calling all cryptos securities, nothing surprising about how judges have ruled when taken to trial
It’s based primarily on what the issuers have said
I don't think you're the only person confused by this ruling. Particularly it seems very strange for something to be ok to sell to retail but not to institutions. The rules on what institutions can buy are generally far broader than retail because of the SEC's "investor protection" mandate.
XRP (Ripple), the "crypto" currency with none of the attributes that make real cryptocurrencies interesting:
- XRP is managed centrally by mostly unknown folks (this is its worst attribute)
- therefore supply isn't fixed and unverifiable
- therefore transactions are ultimately reversible
- protocol security is a joke (see other's remarks in this thread)
- XRP is not anonymous
- XRP was pre-mined
- etc ...
Regarding supply management, it's basically even worse than the US dollar in that instead of folks (the fed) that are eventually answerable to mismanagement mistakes, the Ripple supply is managed by a bunch of people somewhere that you have no control over.
Also, being a very, very distant cousin of Bitcoin, and almost unknown to the masses, it has received almost no scrutiny from the tech. crowd.
Basically, XRP is the equivalent of a county fair token, managed by the local carnies.
I still baffles me to this day that anyone would still pay attention to it.
Walk away from that garbage fire as quickly as you can.
I do find the cultish following XRP continues to have kind of fascinating. Obviously a lot of it is astroturfed but surely some amount of it is real. So many twitter and reddit accounts where all people do is shill their bags when, as you say, basically nothing interesting is happening in the XRP ecosystem.
It's like a religion. It reminds me of the weirder side of the Gamestop stuff.
This was the worst possible outcome for the SEC. XRP is basically a centralized blockchain and they did an ICO back in the day. If XRP isn't a security, basically nothing is, and expect a new boom in retail coin offerings.
On top of the ICO there were some shenanigans with the early ledger (oops our servers ran out of memory), making the whole thing that exists today based on "trust us bro, we promise there’s exactly as many coins as we say there are"
It’s not really exciting, mostly just disappointing they’re still in business, but anyone who wants to learn more can look up: XRPL genesis block
I think we should have a national penalties fund that every single corporate penalty goes into and it specifically can only be spent on various categories of things that are for the public good, but it by popular vote in each category - (Like how we vote for new features in a game, like Manor Lord, ironically enough in such an Oligarchy as it were)...
Anyway - for each industry from which the violations occur, those resources go into these buckets where no politicians allowed - and voting will havent for a GovFundMe Campaign - and it gets funded and every single action on that thing is trackable actively by everyone who voted for the thing and a tracking status board for the implementation of them. And who needed to be shamed in order for that GovFundMe campaign to be completed.
> That sounds interesting, but make sure it's only funding one-offs.
> We don't want a repeat of lotteries funding schools, where that money becomes expected
Making it exclusively one-offs doesn't address that problem at all. What it does is aggravate the problem of people going out looking for someone they can fine to cover their budget.
A construction company's entire business consists of one-off jobs. They expect the money to come in anyway and they're built to rely on the fact that it will. Other organizations funded through one-offs are no different.
In case anyone just reads the headline, this is not a good result for the SEC. Judge reduced the fine from 2B to 125m (94%) and deemed retail sales of XRP was not a security.
SEC has been trying to label pretty much every crypto a security, and XRP is probably the closest thing to one, so if they couldn’t get this…
It's just sad how the corporate-government complex wastes taxpayer money suing itself. Ripple and the government are two sides of the same scam. One scammer operating a monetary ponzi scheme is suing another scammer for taking advantage of the ponzi to scam other people... Using the tax money of the actual victims to pay for the legal proceedings and/or damages that one scammer did to the other scammer.
Meanwhile, both scammers pretend to be working for the victims... And many of the victims are so f** stupid, they actually believe one side or the other.
I blame Hollywood for brainwashing everyone into believing that every story has a good guy and a bad guy. WRONG. Most stories in our society only have bad guys.
What does an injunction against future violations mean? Why would that be weightier than the criminal legal code? Shouldn't such an injunction be assumed by pretty much everybody doing anything?