Billionaire businessman Mark Cuban has once again reached out to former securities official John Reed Stark, this time who was blamed for the collapse of FTX and its impact on creditors.
During a heated back and forth exchangeCuban argued that if the U.S. Securities and Exchange Commission (SEC) had established “clear regulations,” no one would have lost money from its collapse.
Stark previously suggested that cryptocurrency and stablecoins, including central bank digital currencies, do not solve problems, and the crypto industry operates without regulatory oversight, consumer protection or audits, among other things.
You should read how Japan deals with regulation. https://t.co/yHCVwZAqvG
When FTX crashed NO ONE AT FTX JAPAN LOST MONEY.
If only the US/SEC had followed suit by establishing clear regulations requiring the separation of client and business funds and clear… https://t.co/Msvn9o9PCU
— Mark Cuban (@mcuban) July 4, 2023
Cuban argued that Japan, an increasingly Web3-friendly jurisdiction, is an example of a regulator that has gotten it right.
“When FTX crashed, NO ONE IN FTX JAPAN LOST MONEY,” he said.
Stark, a cryptocurrency skeptic, responded by saying that it “seems like a bit of a stretch” to blame the SEC for the collapses of FTX, BlockFi, Celsius, Terra and Voyager, which he called “dumpster fires.”
While Stark admitted that the SEC isn’t always right, he claimed the regulator saved investors “millions, maybe even billions” in crypto losses.
The former SEC official stated that while the cryptocurrency industry seeks regulatory clarity, whenever regulations are enacted or proposed, “the cryptocurrency industry cries foul” and often responds by filing a “flamboyant legal challenge to its promulgation”.
Cuban responded, explaining that the “best way” to prevent cryptocurrency fraud is to implement “brilliant investor protection regulations.” Added:
“Anyone who doesn’t register is de facto in violation, they can’t trade and they will be shut down. This is how you protect crypto investors.
Stark, however, claims that the SEC only charged Binance, Coinbase, Beaxy and Bittrex months after the regulator made it clear those companies were not in compliance.
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“[These firms] chose to ignore the SEC and profit as long as possible without registering,” Stark added.
This is worthy of study Mark, thanks.
Japan’s laws require crypto exchanges to register with authorities, keep customer money separate from their own accounts, hold at least 95% of customers’ digital assets in a cold wallet, and trust customer properties with …
— John Reed Stark (@JohnReedStark) July 4, 2023
It’s the second time in three weeks that the pair have clashed over how cryptocurrency should be regulated.
On June 11, Cuban sued the SEC for allegedly failing to provide cryptocurrency companies with a clear registration process.
He stated that it is “almost impossible to know” what constitutes security because the SEC’s “Framework for Digital Asset ‘Investment Contract’ Analysis” document it does not explain how cryptocurrency companies can comply.
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