- The SEC served a subpoena to Cosmos developer
- Likely due to his protocols synthetic stock product
- Messari CEO claims he is running for Congress in light of the incident
- SEC’s Gensler making a major speech about crypto today
At the Messari Mainnet Conference. which is currently taking place, the SEC is reportedly serving elevator subpoenas to speakers at the event. Basically, something out of a movie. The conference is taking place in NYC, is featuring big names such as Polkadot’s Gavin Wood, Algorand’s Steve Kokinos, Mike Novogratz, and Chainlink’s Sergey Nazarov.
The event is dubbed as an “agenda-setting summit”, “inviting operators, builders, and investors to 3-days of future-focused collaboration, networking, and programming”. Messari is a crypto research firm and a massive one at that. They have extremely big backers, such as Alamada Research, Coinbase Ventures and Gemini, as seen in the below image.
However, the conference has been marred by a nasty story that broke which detailed an incident that occurred sometime on Monday. According to reports, the SEC handed off a subpoena to a speaker of the conference, Do Kwon, the founder of a “Cosmos-based system for algorithmic stable-coins and synthetic stocks”. The CEO of Messari Ryan Selkis, took to Twitter to blast the SEC, and regulators in general.
Excuse the language, but is important as it displays the magnified frustration of leaders in the crypto space as a regulatory cloud hangs over everyone’s head, and has come to a head in such a way that regulators are showing up at conferences to dish out subpoenas to protocol leaders. Ryan even said that they offered a “ton” of free passes to regulators to learn about crypto, which they apparently did not accept. Selkis said: “They [regulators] don’t want to learn. They want to shut crypto down in the US. Full stop”.
If you’re wondering when I actually decided to run for Senate, it was when these fuckers came to my event, didn’t buy a ticket, and served one of the speakers a subpoena.
More war on our out of control regulatory state.
— Ryan Selkis (@twobitidiot) September 20, 2021
As you may have gathered, Selkis was so angry about the incident he pledged to run for Congress, and apparently, he is very serious about it. In an interview regarding the incident, Selkis quipped: “This is not acceptable behavior … to indiscriminately crackdown on an entire industry, blow off invitations to attend a leading U.S. industry conference this year in this space and ultimately make a good-faith effort to engage and try to educate themselves on what’s actually going on”.
Selkis said that regulators should only focus on tax reporting and regulation of centralized exchanges, stating that targeting such “low hanging fruit” would go a long way. It is no surprise that Mr. Kwon was targeted for the synthetic stock offering in his protocol as regulators have already cracked down on Binance for their issuance of synthetic stocks. That area clearly seems to be a big “no-no” for regulators. Binance was forced to shut down its synthetic stock product in mid-July.
However, the event continues, and so does crypto. If anything, it shows that regulators are nervous that the space is getting so large that their influence actually wanes as each day passes. It appears the SEC realizes this toothpaste cannot be put back in the tube. Today is another big today, as SEC Chair Gary Gensler is currently about to go live with the Washington Post to “talk about cryptocurrency”. The title of the talk is called “the path forward” which signals that Gary at least is implicitly admitting that there is a path forward for crypto–it won’t be doomsday.
— Galaxy Digital Research (@glxyresearch) September 21, 2021
Regulators and government money printers really don’t have any room to criticize, as high-level officials of the Federal Reserve have recently been exposed for conflicts of interest regarding their own holdings. According to Reuters, “two Federal Reserve officials said on Thursday they would sell their individual stock holdings by the end of the month to address the appearance of conflicts of interest”.
The officials in question are Dallas Fed President Robert Kaplan and Boston Fed President Eric Rosengren. Rosengren’s case was particularly rotten as he was caught holding stakes in multiple real estate investment trusts, and selling those positions while “also being a vocal critic of the risks in the U.S. real estate market”.
The hypocrisy and double standard are obvious, and intrinsic in our bureaucracy–it is repulsive that officials look under every rock of the crypto industry but of course fail to turn over their own rocks, as they are the mantle of corruption itself. However, we must deal with the SEC, and having vocal critics with big influence like Messari’s Selkis pledging to run for Congress, is exactly the type of energy we need.
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