This Week on Crypto Twitter: SEC Dragnet Drags On

The regulator's recent response to Coinbase indicates that it “is likely to continue changing its mind along the way.”

By Tim Hakki

May 21, 2023

5 min read

Image: @Bitboy_Crypto

This Week on Crypto Twitter — Illustration by Mitchell Preffer for Decrypt

Crypto prices flatlined this week as the battle between U.S. regulators and the blockchain industry dragged on with no substantive developments. Securities and Exchange Commission Chairman Gary Gensler once more insisted that his agency is ready to help crypto companies register, even though none have been able to so far.

Both Gensler and the SEC’s lawyers continued advancing the agency’s position that existing securities laws form clear enough guidelines for the industry, but opponents—including SEC Commissioner Hester Pierce—argue that those rules aren’t clear at all.

On Monday, the SEC responded to Coinbase’s petition for a writ of mandamus—an order that would require the regulator to clarify its rules on crypto regulations. Coinbase’s Chief Legal Officer, Paul Grewal, wrote up his thoughts on the SEC’s response in a thread on Tuesday.

Overall the SEC’s response reinforces Coinbase’s longstanding concern that our industry does not have clarity on what the SEC may consider to be within or outside its jurisdiction at any time, and it is likely to continue changing its mind along the way. 6/7

— paulgrewal.eth (@iampaulgrewal) May 16, 2023

Last week, the SEC relieved blockchain file sharing platform LBRY of a $44 million debt, leaving it only $111,614 left to pay. LBRY took to Twitter to say that, while the debt relief was welcome, the industry should not think for a moment that the SEC is going soft.

2) The SEC's decision to no longer seek disgorgement against LBRY should be read as pure self-interest: the SEC thought they would lose, and wanted to avoid a bad precedent.

We've seen no sign that the SEC is softening its hostility towards blockchain generally.

— LBRY 🚀 (@LBRYcom) May 15, 2023

Meanwhile, outside of the SEC drama, Hollywood’s Justine Bateman on Monday warned her colleagues from the Screen Actors Guild about how she thinks their jobs will be affected by A.I. technology.

Addendum: Actors, you must have iron-clad protection against the AI use of your image and voice in the SAG MBA or your profession is finished. Demand it from @sagaftra and do not accept any AMPTP proposal that does not have it.

— Justine Bateman (@JustineBateman) May 13, 2023

Semi-retired derivatives trader @gainzy222 tweeted some toxic behavior from Adam Tate.

Not saying he launched the coin, but tate knows the viral implications of his tweets and he even cash-tagged the ticker

ie - he wouldn’t tweet your ticker if you paid him 500k, but he just tweeted this one free

looks like someone’s trying to cash in on meme season innit pic.twitter.com/r59zhOiqaw

— gainzy (@gainzy222) May 15, 2023

On Tuesday, developer @vydamo_ wrote a thread cautioning everybody about the unprofessional and abusive behavior of a certain memecoin creator.

I was the developer of @eth_ben first $PSYOP contract. I have never worked with someone more unprofessional or deranged and due to this I left the team before payment. I have credible evidence that Ben does not intend for this to be a fair launch or even project 👇 pic.twitter.com/CTg8JB0mBB

— vydamo (@vydamo_) May 16, 2023

The following day, blockchain sleuth Amir Ormu outed crypto influencer BitBoy for having quickly dumped tokens that he promised he wouldn’t.

Bitboy sold all of his $BEN tokens that he committed to not selling them for 6 months❗️

Bitboy's address which he doxxed it by himself:
0xf89e0b9fb3F419d5982386B5923e2F7C2e73f3a2 https://t.co/GVvrAeVnJ5 pic.twitter.com/OcoKQaKKzH

— Amir Ormu 🛸🏰🫐 (@AmirOrmu) May 17, 2023

Lawyers are getting blockchain-savvy now, according to a Thursday tweet by blockchain sleuth ZachXBT.

Wow both pump and dump meme coins @Nyanmemecoin @GrumpyCat_Coin were just sent cease and desist letters on-chain. pic.twitter.com/drJvjfOQr0

— ZachXBT (@zachxbt) May 18, 2023

For at least one NFT trader this week, the decision to use bots was an expensive mistake.

Wow. So the 1.3 ETH bids were someone's bot. @hanwecheng noticed it and said "I'm going to trick him... and then dump all my NFTs to him... his bot just broke"

tricked the bot, bought NFTs at 0.95 and sold them at 1.3 ETH.

Bot owner lost $200k+.

PvP. https://t.co/NoSuZLy9Tk

— NFTstatistics.eth (@punk9059) May 17, 2023

Bitcoin-maxi Alex Krüger was bullish about A.I. on Thursday.

The AI bubble is just getting started

Wait for your family to pitch you AI stocks during thanksgiving and for the taxi driver to tell you how he is harnessing chatGPT to trade stocks and shitcoins

— Alex Krüger (@krugermacro) May 18, 2023

Republican and crypto-friendly lawmaker Tom Emmer tweeted about a new bill he introduced on Thursday that appears to do some of Gary Gensler’s work for him.

The Securities Clarity Act inserts a key term, the “investment contract asset,” into existing securities law to enable crypto projects to reach their full potential in a compliant way, allowing the United States to compete globally in this next iteration of the internet.

— Tom Emmer (@GOPMajorityWhip) May 18, 2023

Finally, IRL counterparts to the Pudgy Penguin NFT craze have been selling like hot cakes.

Wow @LucaNetz just said in the first 2 days @pudgypenguins sold over $500k of penguins on Amazon that’s over 20,000 Individual penguin toys already 🤯

— Spencer (@sgsand1) May 18, 2023

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