and jumping back to the story involving the sec and
coin base at the agency claiming here about the company
. That's led to a significant debate in the crypto
space about whether certain crypto token should be registered as
securities. It's a big debate and a lot is
on the line here. So everyone from the head
of F. T. X to Mark Cuban weighing
in and joining me now to discuss is Rosen Boykin
, general counsel at the decentralized exchange platform hash flow
. Thank you so much for joining. I'm just
curious to get your take as to what you think
is the best way reason to actually classify some of
these kryptos. Yes. Hi Kristen. Thanks for
having me. Yeah, this case is really,
really important. It has a lot of far reaching
implications in it. The sec is claiming that kind
of back handedly, honestly claiming that these tokens that
it's identified are actually securities and not commodities, which
I'm sure came to as a huge surprise to these
particular projects because the regulators in the United States have
failed to date to issue very clear guidance on what
constitutes a security and what constitutes a commodity. So
I'm sure these projects were not aware that they were
going to be classified as a security in this case
. And I'm sure it also came to a large
, a huge surprise to coin base itself who,
who goes through a lot of takes a lot of
costs on to create a process to evaluate whether the
tokens it lists are or are not securities. So
I'm sure coin base was not prepared for these tokens
, that had really nothing to do with the case
other than that this employee was trading them to be
listed the security. Well, let me ask you
this reason, what's at stake here for coin base
? I mean, what could the sec hold this
company accountable for both on a monetary perspective and even
on an operation standpoint? Yeah, absolutely. For
coin based, these are there are huge implications because
it prides itself and and goes through a lot of
hoops to make sure that it's not listing securities on
its platform. If it does list securities on its
platforms, that would bring it under the purview of
the SEc, which means it would have to take
on all the operational costs of complying with the rules
, which can be quite onerous additionally, if they
were in violation of any of those rules, that
could be a monetary liability attached to that. So
, it's a really big case for coin base and
goes right to its core business model. Well,
I do want to ask about Mark Cuban because he's
been a big backer of Cryptocurrency for a while now
and he did weigh in on the debate. The
billionaire saying that the sec claims are a nightmare for
the crypto space. And I guess I'm wondering is
it just an excuse by the sec to ask for
more taxpayer money here. What do you think?
Yeah. So, first I want to start and
say, you know, the sec has a really
hard job, right? Everybody who operates in the
financial markets knows that these financial regulators, the SEc
, the CFTC have a really hard job and are
working really hard to protect the public. That being
said, I think Mark is really just acting right
now, is the voice of the industry, in
that there is a really huge concern that the sec
is going to be too far reaching and, and
cause for too much bureaucracy and too much cost to
affect the industry, which would therefore push the industry
away from the United States. The sec, unfortunately
, whether fair or unfair, has a bit of
a reputation for being very rules based, which is
kind of scared away certain projects from kind of coming
in and and identifying themselves uh, to the sec
, because they're worried that if they're doing something wrong
and they don't know that they're doing something wrong,
then they'll become a target. Again, I don't
know if that reputation is fair or unfair, but
I think that's what Mark is really commenting on.
He's worried that the sec is going to have to
heart of the hand and then uh kind of hamper
innovation in the industry. What kind of precedent are
assigned does it set if these three individuals, one
who was a former product manager at coin based are
actually convicted of insider trading. Yeah, so,
I mean, there are a lot of implications for
this case for the, for the individual employee and
the companies that employ the employees, like that type
of employee, They really need to implement insider trading
policies uh to ensure that the public is protected from
actions like this. And I think responsible projects will
do that. But there are other, you know
, other I would consider, you know, further
for reaching uh implications like whether or not again the
underlying tokens are actually securities, the process that coin
based uses in order to evaluate whether or not a
token security that's going to have to be looked at
. And whether or not ultimately exchanges like Coinbase are
gonna have to register under the sec or the Cftc
. Okay, listen, we got to leave it
. There are really good to get your take a
really important story that I know of the whole space
. Um It's gonna be watching closely. That's for
Sun Boykin, general counsel and hash flow