The "Chaos Tax"

Twitter shareholder sues Elon Musk, says company is paying a ‘chaos tax’

“Musk’s disregard for securities laws demonstrates how one can flaunt the law and the tax code to build their wealth at the expense of the other Americans,” the suit said.

It quoted another Wall Street Journal article that said Twitter, plagued by confusion about Musk’s shifting plans, has frozen its hiring, fired two senior executives and is suffering from what another executive described as a “chaos tax.”

How Influencers Hype Crypto, Without Disclosing Their Financial Ties

In some cases, promoters like Mr. Paul have admitted that they failed to disclose personal or financial ties to projects advertised on their feeds, a potential violation of federal marketing regulations. And even before the crypto market’s recent downturn, a series of these influencer-backed ventures had crashed spectacularly, hurting amateur traders and prompting lawsuits that could force some celebrities to compensate investors for their losses.

“You have this shameless profiteering from celebrities and others, who aren’t at all disinterested or impartial,” said John Reed Stark, a former chief of the internet enforcement branch at the Securities and Exchange Commission. “There is a lot of potential for harm.”

SPACs Are Warning They May Go Bust

The SPAC boom brought a wave of companies to the public markets promising years of rapid growth and profits to investors. Two years since the boom began, many of these companies are already warning they may go bust.

At least 25 companies that merged with special-purpose acquisition companies between 2020 and 2021 have issued so-called going-concern warnings in recent months, according to research firm Audit Analytics.

Fifth Circuit Court Ruling Asks if SEC Can Even Make Rules

The decision could go beyond the SEC. Other regulators, including the Commodity Futures Trading Commission and the Federal Trade Commission, also use in-house courts. “It will inspire a wave of litigation across all agencies” that use the administrative proceedings, says John Coates, a professor of law and economics at Harvard Law School and a former official and general counsel at the SEC.

Kalshi’s ‘Stock Market of the World’ Lets You Bet on Anything

On Nov. 3, 2020, Election Day, two young entrepreneurs received a call from the chairman of the Commodity Futures Trading Commission with some important news. Luana Lopes Lara and Tarek Mansour had spent the past 18 months trying to get permission to start an ambitious and controversial new type of financial exchange—one where, rather than betting on equity prices or commodity futures, people could trade instruments tied to the outcomes of real-world events, such as the passage of legislation, the weather on a particular day, or the winner of best actor at the Oscars.

“Congratulations,” boomed Heath Tarbert, a Republican who’d been appointed by President Donald Trump the previous year. “You now stand with markets that have been around since the 1840s. And I have no doubt that in time you’ll grow to be a powerhouse, too.”

The Terra/Luna hall of shame

It’s hard not to poke fun at a decentralised, trustless, permissionless, hard-money utopian future of finance unsuccessfully turning to quantitative easing (read: Kwontitative easing) for survival. But as is becoming distressingly clear, some investors have lost most of their life savings from the collapse of terra and its twin coin luna.

This begs the question: who has been encouraging ordinary investors to jump on the latest bandwagon flashing a ticket to the moon? Whose credibility lent lustre to a doomed project? Here is FT Alphaville’s terra/luna hall of shame.