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Everybody running exchanges like Coinbase - had from the beginning the knowledge, that listing coins with premine is more risky than listing coins without premine.
But greed was bigger than fear, it seems...

Just the cost of doing business. Whatever punishment (if any) coming their way is dwarfed by the insane profit over the last several years

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https://pbs.twimg.com/media/Fx8MkqDX0AEAD1w?format=jpg&name=large

That was their fully conscious decision, then.

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Why have sidechains not really taken off

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Probably cus spinning your own altcoin makes a lot more money.

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But what are they supposed to do. One exchange does it, SEC says nothing, and since its popular among traders other exchanges have to follow suit or lose users

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