Matt Levine, Columnist

Bitcoin Bucket Shop Kicks Bucket

They learned about derivatives from me. See how that worked out?

June 19, 2015 at 2:42 PM UTC

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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Sand Hill Exchange was a blockchain bucket shop that let people bet on the eventual public-market prices of hot startups. That is so illegal! It was shut down more or less as soon as anyone noticed that it existed, but the wheels of justice ground slowly on. A few weeks ago, Sand Hill announced that it had settled with the Securities and Exchange Commission for a $20,000 fine, but the announcement quickly disappeared, leaving me to suspect that the entire thing was just a dream, or a performance art project. But this week the SEC finally announced its enforcement action against Sand Hill, along with an Investor Alert warning of "fantasy stock trading websites."

I happen to be on vacation, and I realize that there is bigger financial news this week than Sand Hill. There's that AIG decision,1434659033909 and some stuff in Greece, and lord knows people are worried about bond market liquidity. Nonetheless I am interrupting my vacation for Sand Hill, and not for those things, in part because I already started on this post back when they fleetingly announced their settlement.