• support@madhedgefundtrader.com
  • Member Login
Mad Hedge Fund Trader
  • Home
  • About
  • Store
  • Luncheons
  • Testimonials
  • Contact Us
  • Click to open the search input field Click to open the search input field Search
  • Menu Menu

Bringing Up The Tech Rear

Tech Letter

I’ll never forget when Mad Money’s Jim Cramer boasted that he “liked Coinbase (COIN) to $475” and to keep “doubling down” as the stock went lower.

Funny how things you say come back to haunt you.  

COIN is the American crypto exchange that just got charged with operating as an unregistered broker, operating an unregistered exchange, and operating as an unregistered clearing agency.

Not only that, the SEC specifically scolded them for selling digital tokens with no value such as offering the sale of unregistered securities (SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH, and NEXO).

COIN was at the right place at the right time when crypto blew up to $65,000 and now it is certainly the inverse of that situation.

COIN is now languishing at $51 per share after a 12% selloff and a far cry from the $475 price that Jim Cramer lusted over and gushed to viewers about how much value there was at almost 500 per pop.

The crackdown is certainly not over and SEC commissioner Gary Genseler appears to be on a mission to make digital tokens and the industry supporting it a living hell.

Gensler warned banks to steer clear of crypto because of potential risks to the financial system, making it harder for US citizens to invest.

Paul Grewal, the company’s top lawyer, has previously said that those tokens aren’t securities.

A federal regulator also alleged that Coinbase acted as an exchange, broker-dealer, and clearinghouse all without registering with the SEC for any of those roles.

A virtual currency may fall under the SEC’s remit if investors buy it to fund a company or project with the intention of profiting from those efforts. That determination is based on a 1946 US Supreme Court decision defining investment contracts.

The big takeaway here is the extent to which the SEC thinks crypto is just an utter fraud.

The future appears dim if the SEC keeps bashing this nascent industry.

Digital tokens offer no intrinsic value and deliver no cash flow to shareholders simply because there is nothing to cash flow from.

How can an investor cash flow from a piece of stored code that doesn’t offer actionable software like a photo viewer or music editor?

It’s software that doesn’t do anything but then packages itself as a store of value because we should trust it for no apparent reason--and it’s not even backed by any government.

The SEC goes into the specific coins which they think aren’t securities; and the list is long, which is highly detrimental to COIN’s business.

The tech sector has been roaring in 2023 and the biggest and strongest companies have seen their valuations shoot to the sky.

The knock-on effect is that the bar has been set extremely low for tech companies, but COIN has failed to jump over the low bar.  

Tech firms can’t do IPOs easily at 5% interest rates hence even smaller companies like Roblox (RBLX) and Uber (UBER) performing admirably this year in the Nasdaq.

I am still highly bullish on technology stocks, but COIN and Robinhood or anyone else getting investigated by the SEC or Federal government is a hard pass for me.

 

coin

Share this entry
  • Share on Facebook
  • Share on X
  • Share on WhatsApp
  • Share on Pinterest
  • Share on LinkedIn
  • Share by Mail
https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2023-06-07 15:02:522023-06-28 22:59:11Bringing Up The Tech Rear
You might also like
Alternative Tech Gets Hammered
December 15 Biweekly Strategy Webinar Q&A
December 23, 2021
September 15, 2022
January 17, 2025
November 5, 2021

tastytrade, Inc. (“tastytrade”) has entered into a Marketing Agreement with Mad Hedge Fund Trader (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade and/or any of its affiliated companies. Neither tastytrade nor any of its affiliated companies is responsible for the privacy practices of Marketing Agent or this website. tastytrade does not warrant the accuracy or content of the products or services offered by Marketing Agent or this website. Marketing Agent is independent and is not an affiliate of tastytrade. 

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.

Copyright © 2025. Mad Hedge Fund Trader. All Rights Reserved. support@madhedgefundtrader.com
  • Privacy Policy
  • Disclaimer
  • FAQ
Link to: Quote of the Day - June 7, 2023 Link to: Quote of the Day - June 7, 2023 Quote of the Day - June 7, 2023 Link to: June 7, 2023 Link to: June 7, 2023 June 7, 2023
Scroll to top