Do you fear an "Operation Choke Point 2.0" in your country? (Poll)

[Peter90]

SEC’s Unlawful Targeting of Digital Asset Industry Challenged in New Lawsuit From Startup LEJILEX and Crypto Freedom Alliance of Texas​

The SEC not only lacks legal authority to regulate most digital asset transactions, but has proven it is unprepared to respect the limits Congress has put on its jurisdiction or even to develop and enforce common sense and consistent regulations for this emerging industry, relying instead on regulation via ad hoc enforcement actions. The SEC’s unlawful, unpredictable approach has created an environment in which companies like LEJILEX are unable to operate without fear of being subject to SEC enforcement actions – leaving a trillion-dollar industry and law-abiding individuals in a state of uncertainty while diminishing the United States’ leadership in this critical sector.

businesswire.com

[Peter90]

Custodia is leading a one-bank crypto crusade against the Fed and reviving claims of Operation Chokepoint 2.0

Remember Operation Chokepoint 2.0? The narrative feels like a distant memory, buried by competing storylines like the Sam Bankman-Fried trial and the race for the Bitcoin ETF, but it dominated the crypto airwaves just a few months ago.

One of the companies at the center of the Operation Chokepoint 2.0 narrative says it has new evidence that proves its existence. Caitlin Long, the founder and CEO of Custodia Bank, has been at war with the Federal Reserve for years. With a Harvard Law degree and a Wall Street background, Long has been on a crusade to create a blockchain-focused bank since 2016, going so far as to lobby the Wyoming state government to create a specific digital asset banking structure. The brainchild of the campaign became Custodia, which would offer crypto products like Bitcoin custodial services, as well as its own stablecoin.

Crypto advocates poring over Custodia's 64-page motion will instead find further proof of Operation Chokepoint 2.0. Presented in a different light, Long worked with a state government to create a new legal framework for crypto banking that should work with the Fed model. Instead, the Fed rejected its innovative approach, in a potentially illegal manner.

Coinbase's lawsuit against the SEC gets the lion's share of the headlines, with some legal analysts predicting that it could go all the way to the Supreme Court and defang several federal agencies. Custodia's petition could be just as consequential.

https://finance.yahoo.com/news/custodia-leading-one-bank-crypto-142016251.html

[Peter90]

Custodia is leading a one-bank crypto crusade against the Fed and reviving claims of Operation Chokepoint 2.0

As long as I understand it, the FED is denying to give Custodia a master account and membership with the Fed: "Without such a master account a bank can't offer the same services as institutions with such accounts."
The reason for the denial is basically Custodia's crypto business:

"Eighteen months later, in January 2023, Custodia was rejected in every single category the Fed assesses, partly because of its crypto friendliness and part because it was a state-chartered bank, not a nationally chartered one.
In its rejection, the central bank claimed Custodia's lack of federal deposit insurance and Custodia’s dependence on a vibrant crypto market made it a danger to itself and its customers."

coindesk.com

Interestingly the State of Wyoming filed an amicus briefs (whatever that means...) to support Custodia's lawsuit.

[Peter90]

SEC lawsuit vs. Coinbase

There is a pending litigation between the SEC (U.S. Securities and Exchange Commission) and Coinbase, another sign - imo - that Operation CP 2 is still going on
Let's see what this litigation is about


SEC's argument

• Certain tokens traded on Coinbase constitute “securities” under U.S. securities law.
• Securities can lawfully be made available for trading by the public only on a registered exchange and only registered brokers can perform brokerage services in connection with securities trading.
• Coinbase is not authorized to act as a securities exchange by way of registration or through any exception, nor is Coinbase registered as a broker of securities.

On that basis, the SEC asserts that Coinbase is operating both as an unregistered securities exchange and as an unregistered broker (with respect to any tokens that are securities).


Coinbase’s argument

• The SEC lacks authority to regulate Coinbase because none of the digital assets traded on the Coinbase platform are securities.

According to Coinbase, because tokens sold on its platform are not the subject of any formal contract entitling their holders to payment from the issuers or to any interest in their assets, the tokens cannot qualify as “securities” as a matter of law.
When tokens are purchased through Coinbase, “there is no investment of money coupled with a promise of future delivery of anything. There is an asset sale. That’s it.
It is akin to the sale of a parcel of land, the value of which may fluctuate after the sale.
Or a condo in a new development. Or an American Girl Doll, or a Beanie Baby, or a baseball card.”

freemanlaw.com


So, who do you think is right?
The SEC or Coinbase?

[Peter90]

SEC’s Unlawful Targeting of Digital Asset Industry Challenged in New Lawsuit From Startup LEJILEX and Crypto Freedom Alliance of Texas

"To justify their ad hoc enforcement actions, the SEC claims that practically all digital assets qualify as securities under the SEC’s purview because they represent “investment contracts,” a catch-all category within the definition of security.

In this lawsuit, the plaintiffs seek a judicial declaration that sales of digital assets like the ones that would take place on LEJILEX’s platform are not securities transactions.
As the plaintiffs’ complaint explains, these transactions do not fit the definition of "investment contracts"; if they did, the SEC’s authority would be virtually limitless, covering any purchase of an asset that might appreciate in value.

For example, the SEC’s view of its own authority would apparently mean that buying a pair of limited-run Nike sneakers with the intention of reselling them, while expecting that Nike would continue working to increase demand for those coveted shoes, would be enough to turn those sneakers into securities, their resale into a securities transaction subject to regulation by the SEC, and any auction house or consignment store that helps resell them into an unregistered securities exchange."

finance.yahoo.com


LEJILEX CEO's comment shows that Operation CP2 is still running

"The sec’s actions against our industry have paralyzed those of us who just want to create legal businesses and technologies.
The fear of an abusive application of the rules should not be something that entrepreneurs are forced to experience."

en.cryptonomist.ch

[Peter90]

Operation CP2 coming to Australia?

Australia's biggest bank, Commonwealth Bank, is limiting monthly bitcoin purchases




https://x.com/SimplyBitcoinTV/status/1764246328790679642?s=20

[Peter90]

I'm going to deal with the issues Binance and Kraken are experiencing, as further examples of Operation CP2 still going on in the USA.
But before that

What is sinister is that these people are doing their things silently, not letting the people know what they are doing and the mainstream press is agreeing with them all the way

I agree 100%
and that's why people living outside the USA ignore how crypto businesses in the USA are prevented from receiving banking services, and of how banks are pressured by the authorities to avoid doing business with crypto companies.

But ignorance is not a problem per se, it becomes a problem when trolls think about censuring what contrast with their world view

How does the forum deal with fake news?

[Peter90]

"I wonder how many really understand the bitter opposition by policymakers to Bitcoin and especially an ETF.

Gary Gensler doesn't really hate it because of investor protection ... Elizabeth Warren doesn't actually think its criminal use is significant. Obscure members of Congress who seem to pop up out of nowhere -- with Bitcoin, of all things, strangely on their minds -- and who repeat these tiresome objections ... are in many cases quietly pushed to do so by others, including from the Fed, who understand the real threat:

In a system that depends on irresponsible government spending ... and fiat printing to cover that irresponsibility, alarm bells cannot be allowed to work. There must be no pure price signals. And above all, an alarm bell must not also serve as a life-raft that's easily accessible to everyone, especially the general public, in the form of an ETF. There must be no escape hatch.

This is an unstated but important motivation for the longstanding resistance to Bitcoin and especially an ETF. It's also why the three-judge panel of a federal appeals court that in 2023 essentially forced the SEC to approve the ETFs may ultimately turn out to be the most unsung but consequential people in the history of U.S. financial markets."

twitter.com/MacroScope17

[Peter90]

This is exactly how Operation CP2 works: make life difficult e.g. through examinations or reviews...

That's how banks in the USA are currently pressured by the authorities to avoid offering banking services to crypto businesses.

[Peter90]

I don't understand, I made a list of policies which were put in place - measures which in my view constitute Operation CK2 - and asked which one of them was repealed.
The reason why I asked is that if those policies haven't been repealed, they are still in place, i.e. Operation CK2 is still going on.

This guy smears a user as someone who spreads fake news but he doesn't back up his allegation with any argument, he doesn't answer that question, I invited him to come here and debate with me, but he is what he is

Does anybody know what this guy is referring to when he talks of conspiracy news and conspiracy elements?
Is he referring to some specific policy I listed?
Does he think that there was never an Operation CK2?
Does he think that there was one but today no more?

[Peter90]

SEC is going after Ethereum

Ethereum Foundation under investigation

[Peter90]

SEC lawsuit vs. Kraken

The SEC has sued many companies in the crypto market: Binance, Coinbase, Ripple, LBRY and Kraken. Because LBRY and Kraken did not have the strong economic potential to pursue the lawsuit against the SEC's accusations, they surrendered. LBRY had to pay $111,614 in May 2023^[1], and Kraken also had to pay $30M in February 2023^[2].

At that time, many crypto community members did not support Kraken for accepting defeat so easily, but we can also sympathize with Kraken because they could not afford to pay $200M for the lawsuit with the SEC like what Ripple did^[3]. Everything seemed fine, until we and Kraken realized the SEC's full ambition, the SEC did not want to stop: The SEC alleges Kraken operates as an unregistered securities exchange, broker, dealer, and clearing agency for certain digital assets in Nov 2023. Obviously, despite receiving $30M, the SEC still wants to exploit Kraken's weakness instead of confronting other rich and strong companies.

This time, Kraken did not disappoint us: Kraken filed a motion to dismiss a lawsuit brought against them by the SEC on February 22, 2024.

Kraken contends that the SEC is overstepping its bounds. Kraken maintains that cryptocurrencies are not securities and that staking programs do not meet the criteria established by the Howey Test, a legal framework used to determine whether an investment qualifies as a security. Kraken argues that the SEC is attempting to regulate the crypto industry through enforcement actions rather than through clear and established rules^[4].

If Kraken prevails, it will be a blow to the SEC's attempts to exert control over the crypto market. It could also pave the way for clearer regulations specific to cryptocurrencies, fostering a more stable environment for both businesses and investors. So this time the crypto community did not let Kraken have to fight the SEC alone. The Blockchain Association, a crypto industry advocacy group, has joined the fray by filing an amicus brief in support of Kraken. They argue that the SEC is exceeding its authority and hindering innovation in the crypto space^[5].

The SEC has helped the crypto community become more connected, and helped us understand that: we cannot defend ourselves against the SEC by surrendering, the only way for us to survive is to fight together against the SEC's unreasonable accusations against the crypto market.

I am not a Kraken user, but after Kraken's courage, I love Kraken a lot more, similar to the love I have for the giant Ripple, and am willing to use Kraken's services. I will follow this SEC-Kraken lawsuit and wish Kraken victory: all for Kraken, all for the crypto future.

Are you siding with Kraken in their dispute with the SEC?

[Aanuoluwatofunmi]

We can begin with this by first starting with countries where crypto regulation is not made easy on the people, these same countries would have something similar to this and are likely not going to take it easy on cryptocurrency users because they feels different way of approach on how the implication of digital currencies affects the economy and encourage for illicit activities, that's why some are being that strict on it, this is not happening yet in my own country, you have the right of choosing the means of payment and currency you desire at your own risk and its not against the law to use bitcoin or any crypto.

[Peter90]

We can begin with this by first starting with countries where crypto regulation is not made easy on the people, these same countries would have something similar to this and are likely not going to take it easy on cryptocurrency users because they feels different way of approach on how the implication of digital currencies affects the economy and encourage for illicit activities, that's why some are being that strict on it, this is not happening yet in my own country, you have the right of choosing the means of payment and currency you desire at your own risk and its not against the law to use bitcoin or any crypto.

Yes, authorities have two ways to suppress cryptos: either make it hard to users of make it hard to crypto companies.
In the USA it seems authorities are following the second way.


Just found on X, re SEC vs. Ethereum

[Peter90]

Taken from How does the forum deal with fake news?


So here is another guy who enjoys throwing up unsubstantiated allegations and then run away.
Does anybody know what prompted this smearer to think I'm doing politics?
What would be my politics?