"DOJ will no longer prosecute cryptocurrency fraud" is clickbait and not what the Todd Blanche memo says.
They will still go after the Sam Bankman-Frieds:
>Prosecutors shall prioritize cases that hold accountable individuals who (a) cause financial harm to digital asset investors and consumers; and/or (b) use digital assets in furtherance of other criminal conduct...
But seem to be intending to deal with whether it is ok to do things like issue trump token by setting regulations rather than prosecuting companies after the event. Which is not wholly a bad idea.
> ok to do things like issue trump token by setting regulations
That would make sense if the Trump admin were actually regulating crypto but they're tearing that up as well.[1] Why would Trump regulate his own scam coins? Finally regulation isn't a magic wand that stops behavior, it stops it with the threat of punishment after the event. So no this doesn't make sense.
Yes, but typically there are clear guidelines on what will be punished and what is allowed. That was not the case under Gensler. Crypto companies begged for clear regulations and the SEC steadfastly refused to publish any. Instead they just filed enforcement actions and people had to find out their view of things in court.
And as your link says:
> “We in the crypto space felt it was very deceptive the way they [the Biden administration] went about dealing with crypto firms. They told crypto firms to come in and register, to come in and engage with them,” said Nic Carter, a founding partner at crypto investment firm Castle Island Ventures. “There was no meaningful way to do that.”
Yes, considering it was ~2 years from freezing withdrawals to the approved bankruptcy plan to repay customers.
FTX was only able to repay customers because the value of BTC increased during that time. But customers were only repaid the value of their portfolio at the time of the collapse.
If I steal your money, invest it, then return the principal amount after 2 years, would you consider it financial harm?
Many reasons why this wouldn't be sufficient. Having a fall guy is a good example, doesn't allow for action against organization level willful fraud would be another. It basically slows down any sort of justice.
Just another good reason to stay out of crypto unless you're already rich and have money to gamble.
I try to view things like this from the other perspective and wonder just why so many people still view this person like he's the common man's savior. I think I'm cognitively dissonance-ing myself from possibly all the cognitive dissonance I'm surrounded with.
Welcome to demagogy 101. In this session, we'll talk about "guiding" public opinion by buying a small but loud support team that looks bigger in the media.
Thank you for enrolling at Banana Democracy Uni! We look forward to train the new generation of wannabe dictators.
The average person spends less than 5 minutes a month consuming news content and assumes important information will just fall into their lap. People in general are just not paying all that much attention.
Trump’s secret sauce is exploiting this from every angle.
“And in their desperation, they turned to a man they didn't fully understand.”
— Alfred describing why the mob hired the Joker
It’s clear that both political parties in the US are captured by the investor class, the democrats didn’t even have an election to choose Kamala she was selected by their donors who preferred someone they could control over someone with the best chance of winning.
If the lesson people take away from this is that Republicans are just uneducated and naive, they’re missing the point. People were desperate for something different, they thought Trump was someone from outside of the system but they didn’t realize that the system is money and no one is outside of it.
There's a very good reason for this: those general elections cost states money. Money they have not budgeted to re-run a primary. In addition, in most states, the primary is framed in a legal process that does not allow for an "out-of-band" second election. It would, generally, have been illegal to re-run an election (at least using the physical voting apparatus of the myriad states) to choose an alternate when Biden dropped, which is why the party chooses via their own process.
And as far as I'm aware, that process was followed following Biden's announcement. I wouldn't accuse Republicans of being uneducated and naive if people didn't vote for Harris because "she never won a primary..." I'd accuse traditional Democrat voters of not knowing very much about the party they (nominally) tend to support. It'd be nice if civics weren't just something people's parents and grandparents did.
As for being an outsider... In 2024, I fail to see how voters would think a former President could be considered outside the system.
Let me give you a simpler, Occam's-razorish explanation: People who voted for Trump aren't stupid, or naive, or anything. They simply were unable or unwilling to accept the world changing around them regarding race, sexuality, welfare, climate, economy, foreign and domestic policies. They elected someone who told them "we'll go back to the old times one way or another, consequences be damned".
This is exactly what they voted for, what they were hoping for. They knew leopards would've eaten the face of a few of them, but it was somewhat expected, a calculated risk. There's a few casualties even when you win the war.
They saw something they could cling to, to avoid changes for the remaining of their lives, even if this meant destroying their country, the rest of the world or the future for the matter. And they replied with "Yes, we're fine with that".
Interesting take. I believe this is a theme that everyone in the US is familiar with, but the idea that "big money is the enemy" and the reality of it has somehow not permeated through the general public enough. It seems that the Trump-voting public sees the Democrats as compromised rather than the Republicans, but even with this one action by Trump you can argue strongly that they are as well.
I’m not a fan of Trump but my steelman argument for this is: policing public markets is a public good because efficient capital markets are the bedrock of a capitalist society.
It’s hard to make the same case for crypto, which (despite the insistences of its participants) more or less exists in isolation from the rest of the market. The industry feels it is over-regulated. Makes sense that a more lassiez-faire leader would take a more hands-off approach to it.
If nothing else, I feel like this view is myopic. Capital markets are people and jobs. When crypto projects collapse, or rampant fraud, abuse, manipulation, and outright theft are allowed, that money is coming out of real peoples pockets, and that has real rippling effects that are not only objectively disruptive to the economy, but are also much more difficult to then predict, measure, and respond to which further amplifies their detrimental impacts.
The title of the article on the website is misleading and actually untrue.
The memo did not say “no longer targeting fraud”- it said that it was no longer targeting individuals and exchanges for regulatory missteps. The theme of the memo is “we’re not going to use mountains of regulations written for non-crypto regulation to go after crypto exchanges”, which is in line with a general regulatory themes of the Trump administration to avoid “lawfare” type activities and reduce regulatory burdens.
In fact, the memo specifically said (according to the article, near the end) that the government would focus their efforts on fraud against crypto investors.
Now you might or might not agree with these goals, and you might or might not support the Trump administration, and you might or might not like Trump, but the article headline was at odds with the article content and with the DoJ memo.
Seems like an odd choice to move some but not all comments between posts like this. Especially when the only ones moved seem to be conservative talking points. This one even discusses a title that doesn’t exist on this article?
> prior Administration used the Justice Department to pursue a reckless strategy of regulation by prosecution
What was the idea before? It wasn't necessarily illegal but they prosecuted it anyway?
> Executive Order 14178 requires the Justice Department to prioritize investigations and prosecutions that involve conduct victimizing investors, including embezzlement and misappropriation of customers’ funds on exchanges, digital asset investment scams, fake digital asset development projects such as rug pulls, hacking of exchanges and decentralized autonomous organizations resulting in the theft of funds, and exploiting vulnerabilities in smart contracts. Such enforcement actions are important to restoring stolen funds to customers, building investor confidence in the security of digital asset markets, and the growth of the digital asset industry.
I guess before anyone using these crypto services was a target for prosecution and now they are not, just by the virtue of using them.
A few comments here have hinted at this: we don't need to have a debate about penalizing platforms for the fraud of the users, everyone agrees that's problematic. The reason this directive confuses me is because very often the fraudsters are the platform runners themselves.
> Instead of policing crypto platforms and exchanges, Trump’s DOJ will “focus on prosecuting individuals who victimize digital asset investors, or those who use digital assets in furtherance of criminal offenses such as terrorism, narcotics and human trafficking, organized crime, hacking, and cartel financing.”
Wonder if this hints at possibly reducing or relaxing KYC rules also?
> Wonder if this hints at possibly reducing or relaxing KYC rules also?
Good call, I would assume so. KYC helps prevent money laundering, bribes and a ton of other illegal transactions. Eliminating it would line up with other actions performed by this admin.
On the other side KYC rules and enforcement can be anything from annoying to downright asinine (and not just for banks).
I'd prefer if governments would take a step back and invest into enforcing actual crimes themselves and not just stick with money laundering charges because these are easier to prove. It was already bad under Al Capone (who got nabbed for taxes instead of murder), and it's way worse today.
Readit News
The memo: https://archive.ph/Td0Fn (via https://news.ycombinator.com/item?id=43636327)
They will still go after the Sam Bankman-Frieds:
>Prosecutors shall prioritize cases that hold accountable individuals who (a) cause financial harm to digital asset investors and consumers; and/or (b) use digital assets in furtherance of other criminal conduct...
But seem to be intending to deal with whether it is ok to do things like issue trump token by setting regulations rather than prosecuting companies after the event. Which is not wholly a bad idea.
Memo text here: https://archive.ph/Td0Fn
That would make sense if the Trump admin were actually regulating crypto but they're tearing that up as well.[1] Why would Trump regulate his own scam coins? Finally regulation isn't a magic wand that stops behavior, it stops it with the threat of punishment after the event. So no this doesn't make sense.
1: https://thehill.com/policy/technology/5170036-trump-sec-cryp...
And as your link says:
> “We in the crypto space felt it was very deceptive the way they [the Biden administration] went about dealing with crypto firms. They told crypto firms to come in and register, to come in and engage with them,” said Nic Carter, a founding partner at crypto investment firm Castle Island Ventures. “There was no meaningful way to do that.”
Technically FTX/Alameda was able to repay investors and consumers so did SBF cause financial harm?
He definitely did fraud (a crime), but did he cause financial harm?
Similarly does Money Laundering (a crime) cause financial harm?
FTX was only able to repay customers because the value of BTC increased during that time. But customers were only repaid the value of their portfolio at the time of the collapse.
If I steal your money, invest it, then return the principal amount after 2 years, would you consider it financial harm?
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Just another good reason to stay out of crypto unless you're already rich and have money to gamble.
Thank you for enrolling at Banana Democracy Uni! We look forward to train the new generation of wannabe dictators.
Trump’s secret sauce is exploiting this from every angle.
— Alfred describing why the mob hired the Joker
It’s clear that both political parties in the US are captured by the investor class, the democrats didn’t even have an election to choose Kamala she was selected by their donors who preferred someone they could control over someone with the best chance of winning.
If the lesson people take away from this is that Republicans are just uneducated and naive, they’re missing the point. People were desperate for something different, they thought Trump was someone from outside of the system but they didn’t realize that the system is money and no one is outside of it.
There's a very good reason for this: those general elections cost states money. Money they have not budgeted to re-run a primary. In addition, in most states, the primary is framed in a legal process that does not allow for an "out-of-band" second election. It would, generally, have been illegal to re-run an election (at least using the physical voting apparatus of the myriad states) to choose an alternate when Biden dropped, which is why the party chooses via their own process.
And as far as I'm aware, that process was followed following Biden's announcement. I wouldn't accuse Republicans of being uneducated and naive if people didn't vote for Harris because "she never won a primary..." I'd accuse traditional Democrat voters of not knowing very much about the party they (nominally) tend to support. It'd be nice if civics weren't just something people's parents and grandparents did.
As for being an outsider... In 2024, I fail to see how voters would think a former President could be considered outside the system.
This is exactly what they voted for, what they were hoping for. They knew leopards would've eaten the face of a few of them, but it was somewhat expected, a calculated risk. There's a few casualties even when you win the war.
They saw something they could cling to, to avoid changes for the remaining of their lives, even if this meant destroying their country, the rest of the world or the future for the matter. And they replied with "Yes, we're fine with that".
It has an interesting conjecture, and sounds like it was written in good faith.
Dead Comment
It’s hard to make the same case for crypto, which (despite the insistences of its participants) more or less exists in isolation from the rest of the market. The industry feels it is over-regulated. Makes sense that a more lassiez-faire leader would take a more hands-off approach to it.
The memo did not say “no longer targeting fraud”- it said that it was no longer targeting individuals and exchanges for regulatory missteps. The theme of the memo is “we’re not going to use mountains of regulations written for non-crypto regulation to go after crypto exchanges”, which is in line with a general regulatory themes of the Trump administration to avoid “lawfare” type activities and reduce regulatory burdens.
In fact, the memo specifically said (according to the article, near the end) that the government would focus their efforts on fraud against crypto investors.
Now you might or might not agree with these goals, and you might or might not support the Trump administration, and you might or might not like Trump, but the article headline was at odds with the article content and with the DoJ memo.
What was the idea before? It wasn't necessarily illegal but they prosecuted it anyway?
> Executive Order 14178 requires the Justice Department to prioritize investigations and prosecutions that involve conduct victimizing investors, including embezzlement and misappropriation of customers’ funds on exchanges, digital asset investment scams, fake digital asset development projects such as rug pulls, hacking of exchanges and decentralized autonomous organizations resulting in the theft of funds, and exploiting vulnerabilities in smart contracts. Such enforcement actions are important to restoring stolen funds to customers, building investor confidence in the security of digital asset markets, and the growth of the digital asset industry.
I guess before anyone using these crypto services was a target for prosecution and now they are not, just by the virtue of using them.
Trump serves only to serve himself consummately.
Wonder if this hints at possibly reducing or relaxing KYC rules also?
Good call, I would assume so. KYC helps prevent money laundering, bribes and a ton of other illegal transactions. Eliminating it would line up with other actions performed by this admin.
I'd prefer if governments would take a step back and invest into enforcing actual crimes themselves and not just stick with money laundering charges because these are easier to prove. It was already bad under Al Capone (who got nabbed for taxes instead of murder), and it's way worse today.
Deleted Comment