News
Search Results
SEC Coinbase Suit
06/08/2023 The SEC has finally brought its long-anticipated lawsuit against Coinbase. The suit alleges that Coinbase has operated as an unregistered securities broker, an unregistered securities exchange, and an unregistered securities clearing agency, and that it ...[more]It's Not Just an SVB Problem: the Systemic Nature of the Bank Regulation Failure
03/28/2023 A mid-sized regional bank specializing in lending to tech start-ups, crypto companies, or law firms hardly seems of systemic importance, even if its failure would have caused disruption in some industries regionally and might have triggered a cascade of ...[more]FDIC's Poor Track Record in Holdco Bankruptcies
03/25/2023 Last week I did a post about how the FDIC as receiver for Silicon Valley Bank probably doesn't have a claim against SVB Financial Group, the holdco of the bank. I got some pushback on that (including from a former student!), but I'm sticking to ...[more]SDNY: EFTA Applies to Crypto
03/22/2023 I'm teaching cryptocurrency today in my Payment Systems class, and I'd been puzzling about why no one has applied the Electronic Fund Transfers Act and Reg E thereunder to crypto: after all, if you have a crypto account with an exchange, it ...[more]The Financial Regulatory Credibility Problem
03/21/2023 Financial regulation has a credibility problem. Actually, it's got two credibility problems. It's not credible any more to think that financial regulators will shut down troubled institutions until they are forced to do so. And it's no ...[more]The Regressive Cross-Subsidy of Uncapping Deposit Insurance
03/21/2023 There's talk about removing the FDIC deposit insurance caps in response to the "Panic of 2023"®. There's a refreshing realism about such a move. But let's also be clear about the distributional impact of such a move: it's a ...[more]Was SVB's problem a lack of membership?
03/11/2023 If the bank is a Fed member, doesn't it take its USTs to the discount window instead of selling them for big losses? Does this suggest that all large banks (however defined) should be Fed members, regardless of their charter status? ...[more]Why Weren't Silicon Valley Bank Depositors Using CDARS?
03/11/2023 Silicon Valley Bank seems to have had large amounts of uninsured deposits from businesses and high net worth individuals. And those uninsured deposits are likely to be impaired in the receivership, meaning that they will not get paid 100 cents on the ...[more]The New Usury
02/03/2023 I have a new paper up on SSRN . It's called The New Usury: The Ability-to-Repay Revolution in Consumer Finance . It's a paper that's been percolating a while--some folks might remember seeing me present it (virtually) at the 2020 Consumer ...[more]Binance's Custodial Arrangements: Whose Keys? Whose Coins?
11/08/2022 For months, cryptocurrency FTX (and its majority owner, Sam Bankman-Fried) have been the lender of last resort in crypto markets and pretty much the only distressed acquirer around. Now we learn that FTX has itself failed and is getting scooped up in a ...[more]Let's Make Some Crypto Law!
08/03/2022 One of the undiscussed consequences of the spate of recent crypto bankruptcies – domestically including Celsius and Voyager – combined with Congress' inability to legislate is that the bankruptcy courts, namely those in the SDNY, will have a chance ...[more]What Happens If a Cryptocurrency Exchange Files for Bankruptcy?
02/03/2022 Exchanges play a key role in the cryptocurrency ecosystem, but no one seems to have given any consideration to so far is what happens when a cryptocurrency exchange that provides custodial services for its customers ends up in bankruptcy. We’ve never had ...[more]FDIC Power Struggle
12/10/2021 Remember when there were two dueling claimants for the title of CFPB Director? Well, we're now seeing a repeat of that conflict play out with the FDIC. ...[more]Further Thoughts on Coinbase: Two Mysteries
09/14/2021 I've been puzzling over two mysteries in the Coinbase saga: first, why does Coinbase care so much if Lend is deemed a security, and second, why did the SEC want the list of Coinbase customers who had signed up in advance for Lend. I don't know ...[more]Collins v. Yellen: the Most Important (and Overlooked) Implication
06/29/2021 The Supreme Court's decision in Collins v. Yellen has garnered a fair amount of attention because it resulted in a change in the leadership at the Federal Housing Finance Agency and largely dashed the hopes of Fannie and Freddie preferred ...[more]Fake Lender Rule Repeal
06/21/2021 The House is schedule to take up a vote on repealing the OCC's " Fake Lender Rule ," that would deem a loan to be made by a bank for usury purposes as long as the bank is a lender of record on the loan. Under the rule, issued in the waning ...[more]Are Mortgage Servicers Ready for the Loan Mod Rush?
05/10/2021 On May 4, the CFPB issued a report sharing information the agency had gathered about mortgage forbearances and delinquencies. One notable takeaway is that Black and Brown homeowners, as well as low-income homeowners, are very prevalent among those in ...[more]A Campaign to Opt-Out
04/25/2021 Following-up on my prior post , let’s talk more about what’s at stake in this little legislative kerfuffle in the Hawkeye state, as well as how consumer advocates should seize on this moment in a different way. ...[more]Abolish the OCC?
04/22/2021 I've been saying for quite a while that the OCC is a "problem agency" that is seriously in need of reform. An article in Politico today underscores the problem. The OCC—under a civil servant acting Comptroller—has begun an active lobbying ...[more]