Bots Inc (BTZI)

[lesgetrich]

They were shut down for trading irregularities

Reading a little history might change your view. First Bitcoin was halted during the summer of 2017.

Deconstructing the SEC's Cryptocurrency-Suppression Program:

In 2017, the U.S. Securities and Exchange Commission (“SEC”) established an agency-wide program dedicated to shutting down the cryptocurrency industry: what we call the cryptocurrency-suppression program (“Suppression Program”).1 The SEC’s rhetorical objective is to protect investors. We think that the real objective is to prevent disintermediation.

Banks are intermediaries between savers and borrowers: they receive funds from depositors and relend those funds to borrowers for profit.2 Disintermediation is the removal of the middleman standing between savers and borrowers—the banks—and it occurs when depositors and savers move their money to alternative financial products, such as money market funds.3 For the purpose of this article, we define cryptocurrencies—including virtual currency, digital tokens, or digital coins—as private digital money or (“PDM”).4 PDM threatens bank products, such as checking and savings accounts, banks’ inventories of lendable funds, and consequently, banks’ profits. The Federal Reserve and national banks of the United States have a strong incentive to prevent the proliferation of private currencies that compete with non-private currencies, fiat money, like the United States dollar (USD).

Regardless of what institutions actually profit from the Suppression Program, the SEC’s crusade against PDM stands on a foundation of sand and deserves to be knocked down...

...Enforcement’s role has been to shut down ongoing sales of cryptocurrencies through injunctions and cease-and-desist orders and to extract sales proceeds from cryptocurrency producers through the judicial and administrative legal remedies of disgorgement and civil money penalties. The Enforcement role began in the latter half of 2017 and has two key components: (1) a manifesto Enforcement published on July 25, 2017, named the “Report of Investigation: The DAO,”24 and (2) a special unit of Enforcement, which the SEC announced on September 25, 2017, called the Cyber Unit, which is tasked with investigating and bringing legal actions involving the internet, hacking, and other online misconduct.

Enforcement’s DAO Report

The DAO Report: (1) discussed the issuance of the DAO cryptocurrency, finding each DAO token to be a “security”; (2) announced that cryptocurrencies deemed to be securities are subject to the registration and anti-fraud provisions of the Securities Act and anti-fraud provisions of the Exchange Act; (3) warned that it would investigate and bring enforcement actions against sellers of cryptocurrencies deemed to be securities which did not comply with registration requirements or engaged in fraud; and (4) provided its analysis of why a token of cryptocurrency falls within the non-standard type of “security” called an “investment contract.”...

...Options for the Cryptocurrency Producer

This gives the cryptocurrency company two options: enter the labyrinth and seek to register the units of cryptocurrency for sale, or sell cryptocurrency units without registration. If the company chooses the registration route, the cryptocurrency units will likely not be registered. If the company chooses to sell units without registration, Enforcement will shut down operations. These options—one of which is allegedly required and “legal” and one of which is “illegal”—ensure failure in either case and leave the crypto-company with no viable option. Hence, our view that the SEC is engaged in a Suppression Program designed to hinder the production of PDM in the United States.

Deconstructing the SEC's Cryptocurrency-Suppression Program: Part Two

The SEC’s PDM Program

On September 27, 2017, about two months after issuing its DAO Report, the SEC announced the creation of a new “Cyber Security Unit” (“CSU”) office in the SEC’s Division of Enforcement.22 The CSU was formed to investigate and propose civil actions for, among other things, “violations involving distributed ledger technology and initial coin offerings,”23 and soon began to identify, investigate, and bring legal actions against entities and individuals that sold, usually quite successfully, large quantities of PDM units.

From 2018 to 2019, the CSU brought over fifteen PDM matters, which included federal court actions, typically unsettled when filed, and administrative proceedings that had settled before filing. In these matters, the agency sought to enjoin and obtain disgorgement and penalties from companies that had sold units of PDM to the public without SEC approval under the Securities Act of 1933 (“Securities Act”).24 In 2020, the unit brought over fifteen additional PDM matters, many of which involved a so-called initial coin offering (“ICO”).25