John Reed Stark

President, John Reed Stark Consulting LLC | Senior Lecturing Fellow, Duke University School of Law | Former Chief, SEC Office of Internet Enforcement

[John Reed Stark @JohnReedStark]

My late grandfather was a patriot's patriot but don't take my word for it. A treasure trove of his letters home, found in a dusty old shoebox, not only offer a unique/unfiltered glimpse into WWII army life, but they also bestow 6 essential career lessons.
https://t.co/RyK35EXHxP

[John Reed Stark @JohnReedStark]

I testified about the Clarity Act last week before the Senate, calling it the worst piece of financial regulation in modern American history and calling SEC Chairman Paul Atkins a raving Big Crypto sycophant and carnival barker. Here are the highlights: https://t.co/rlR08rFHDu

[John Reed Stark @JohnReedStark]

@Guruleaks1 @SEC_Enforcement Nothing going on at the SEC but the rent.

[John Reed Stark @JohnReedStark]

@GregFinberg Westbrook. But make Gill a staffer. Westbrook was fire when he was a Wizard. Totally devoted to his teammates and the fans. Btw Greg, why does A.D. think it’s okay to behave like he is a free agent when he has a contract??!! The Wiz should not extend. Make him prove his worth.

[John Reed Stark @JohnReedStark]

Tomorrow I Testify Before the Senate Permanent Subcommittee on Investigations and Committee on Banking, Housing & Urban Affairs

An excerpt from my 26,700-word testimony:

Imagine a Surgeon General who spends weekends filming cigarette commercials. Or a fire marshal who tours the US selling kerosene and space heaters to families living in wooden houses. Or a lifeguard who charges swimmers admission to the riptide.

That is precisely what has happened at the SEC. Paul Atkins, the Chair of the agency created amid the wreckage of the Crash of 1929 to defend the investing public from engineered euphoria, has become the loudest promoter of the most dangerous, most demonstrably worthless and most crime-enabling asset class in the history of finance.

When the head of the agency built to police Ponzi schemes personally tours conferences, television studios and social media promoting a so-called asset class whose returns depend entirely on recruiting later buyers, while gleefully abdicating his investor protection mission, there is only one title that fits: "Chief Ponzi Officer."

Just ask the question every analyst asks of every asset, including the mathematical blather of crypto: what am I buying? Crypto tokens have no cash flow/no yield/no earnings/no employees/no products/no balance sheet/no claim on anything, a boundless data vacuum making valuation impossible, leaving only one price support: the arrival of the next buyer. The mechanism that fills the valuation vacuum is FOMO and social proof, courtesy of SEC Chair Atkins, the first hype-man in history with subpoena power.

Where the hobnail boots of yesteryear once stood, there is now an invisibility cloak. Atkins has silenced the SEC's enforcement program under the auspices of "innovation." That is Atkins's signature ruse and it's absurd.

Atkins has bet the entire SEC on blockchain and tokenization. But who is not making that bet? Amazon/Apple/Google/Meta/Microsoft/Oracle. Their blockchain spending: zero. The innovation Atkins is selling is a technology America's actual innovators examined, tested and buried.

Meanwhile, the CLARITY Act Atkins champions would be the first major financial legislation in US history enacted to answer darkness with less light, enabling a post-apocalyptic Walking Dead-like cesspool of greed, chicanery and grift.

Crypto's dire externalities are not abstractions, the carnage is not theoretical. Every retiree's savings drained through a crypto ATM is an externality. Every ransomware payment is an externality: the hospital diverted, the school district shut down.

And get this — Every sanctioned drone and missile program topped up in stablecoins is an externality. We’re sanctioning Iran while deregulating the crypto they use to buy the drones and weapons that kill American soldiers. That’s like stepping into the UFC octagon and handing your opponent brass knuckles between rounds.

The Stark Reality: Paul Atkins tours the US like a raving Big Crypto sycophant, force-feeding investors his Atkins Diet of crypto laissez-faire, all while reveling in his role as America's first Chief Ponzi Officer. It's time to stop the hustle.

Written testimony: https://t.co/H8sq9yzzHU

[John Reed Stark @JohnReedStark]

https://t.co/KUrPH3uxHa

[John Reed Stark @JohnReedStark]

@michaeljburry https://t.co/KUrPH3uxHa

[John Reed Stark @JohnReedStark]

My best guess, just an opinion, is that the SEC is actively investigating while the DOJ, if not investigating in parallel, is getting briefings from the SEC as needed on the SEC’s progress.

Typically, the SEC will stand down once the FBI/DOJ get serious about investigating but in the early days of a situation like this one, the SEC and DOJ can be acting in parallel independently with some coordination and the SEC can provide to the FBI/DOJ every single text, email, document they collect together with transcripts and notes relating to any SEC witness interview or SEC testimonial proceeding.

To me, this situation seems like exactly the kind of matter that Chairman Paul Atkins wants the SEC to investigate and the exact type of matter that garners FBI/DOJ attention. Along these lines, I would not be surprised if the SEC and/or DOJ are not working with the whistleblower directly.

[John Reed Stark @JohnReedStark]

This is a harbinger. To me, the Delve senior executives in this video seem creepily programmed and their representations raise far more questions than answers. In my opinion, the SEC enforcement division is likely actively investigating the situation, and perhaps DOJ is investigating as well. Oh, one more note, the offer of help from Elizabeth Holmes (if it’s real) is not helping their credibility or cause.

[Karun Kaushik @karunkaushik_]

There’s been a lot of allegations against Delve.

But we haven’t been able to share our side of the story until today due to ongoing cybersecurity and forensics investigations.

Maintaining customer trust is central to everything we do.

That said, we grew too fast and fell short of our own standard. To our customers, we deeply apologize for the inconveniences caused.

We take these allegations seriously and have made changes: a new auditor network, free re-audits and pentests for all customers, enhanced transparency in audit communications, and more.

However, we also want to set the record straight on the anonymous attacks.

The evidence we have points to a targeted cyberattack from a malicious actor, not a “whistleblower.”

We believe the attacker purchased Delve under false pretenses, exfiltrated internal company data, and used it to launch a coordinated smear campaign.

The posts rely on a mix of fabricated claims, cherry-picked screenshots, and stolen data taken out of context.

See the link in the comments for more details.

Delve was built to modernize compliance. We are not going anywhere and are committed to building what's next.

[John Reed Stark @JohnReedStark]

What do you think @grok ?

[John Reed Stark @JohnReedStark]

This is a terrific analysis and powerful recommendation for investing in what I view as one of the better AI tools in the world (alongside Grok and ChatGPT). So I asked Anthropic (https://t.co/GuZFtfuXEO) their opinion -- here is Claude's response (anybody care to ask Grok?):

This is an interesting piece on the disclosure challenges around investing in private companies through public company stakes. Let me share my perspective on the claims and the broader thesis.

What the post gets right:

The core argument about disclosure opacity is legitimate. Under accounting rules, companies must regularly update the reported value of their private investments to reflect changes in market price per share, through "mark-to-market" adjustments
— but they often don't have to disclose exact ownership percentages or break out specific investments from their broader portfolio of non-marketable securities. This genuinely does create challenges for investors trying to calculate exposure.

The Google 14% figure is accurate — it was previously public knowledge that Google had pumped billions into the company, but its ownership stake was only revealed through legal filings in an antitrust case.

Where the numbers need updating:

The $350 billion IPO figure is actually close to Anthropic's current private market valuation, not a hypothetical. On December 31, 2025, it was confirmed that Anthropic had signed a term sheet for a $10 billion funding round at a $350 billion valuation. Wikipedia This followed the September 2025 Series F that valued Anthropic at $183 billion.

On Amazon's stake, there's useful reverse-engineering from earnings reports: Amazon's Q3 profit included a $9.5 billion pretax gain tied to the rising valuation of its Anthropic investment GeekWire when the valuation nearly tripled to $183B, which is how analysts derive that ~7.8% estimate. But you're right — it's imprecise because you need to know prior carrying values.

My take:

The frustration about disclosure is understandable, though there are legitimate reasons companies don't break out every minority investment. That said, the post slightly overstates the investment thesis — even if you could perfectly calculate Amazon's and Google's Anthropic exposure, it would represent a relatively small percentage of those companies' overall value. Amazon's market cap is roughly $2.4 trillion, so even a $25-30 billion Anthropic stake is around 1% of the company.

I'm not in a position to recommend whether this approach to "investing in Anthropic" makes sense, John — that depends on your broader portfolio goals and risk tolerance. But the analytical points about disclosure are well-taken, and it's the kind of granular accounting critique you'd appreciate from someone like Matt Levine.

[Materiality Check @materialitychck]

🚨Materiality Check: The challenges of investing in Anthropic/Claude

@AnthropicAI and @claudeai have been making headlines for their new models that feature advanced co-work abilities.

You as an investor may be asking: How can I get exposure to this great company, even though they are private?

Two massive public companies have significant stakes in Anthropic: $GOOGL and $AMZN.

The problem, though, is accounting rules allow for these companies to omit disclosure of both their ownership percentage in Anthropic, and the exact carrying value of the investment on their balance sheet.

This makes it impossible for investors to know both the piece of Anthropic that they would get in a potential investment, and how much value each of the companies stands to gain upon an expected $350 billion IPO.

Amazon owns anywhere from 7.8% to 19% of Anthropic depending on how much they have been diluted and how much gain they have already recognized (this is how investors are forced to calculate ownership percentage). That's anywhere from $27-67 billion -- a massive range.

We know that Google owns 14% of Anthropic, but not because they mention it in any financial reports. Instead, because it was revealed in the legal filings of an antitrust case.

Still, per our last post on Google, they only listed roughly $38 billion in non-marketable securities in last year's annual report, and have not disclosed exactly how much gain they have recognized on each of their investments.

This makes it very hard to know how much of Anthropic's rise is priced in, which might be important for investors who are specifically looking to get a piece of the Anthropic pie.

At IPO, Google's investment would be worth an estimated $49 billion.

This is information that investor's should have easy access to -- forcing them to make complex calculations and guesswork is absurd.

These investments are material and they should be treated as such!

[John Reed Stark @JohnReedStark]

Would buying Google stock make sense as a play on SpaceX, Anthropic and Waymo? Are Google’s investment holdings already baked into the stock price even though Google’s investment holdings are not specifically referenced in Google’s SEC filings (which is seemingly permitted under SEC regulations and is consistent with Generally Accepted Accounting Principles)?

In other words, Google, with a mere forward PE ratio of 29.33 and with great products and great management , seems poised to experience future investment windfalls of epic proportions. Are investors missing the fact that Google might be the next great stock of the decade?

We already own some Google, is it a good time to buy more?

(Not investment advice; not any sort of investment professional; just an old SEC guy who likes talking stocks every once in a while.)

[Materiality Check @materialitychck]

You can't undervalue $GOOGL's amazing ability as a venture capital fund. SpaceX, Anthropic, Waymo, and this list goes on... shows incredible management, decision-making, and feel for the future. I just hope we get to see some of these gains itemized in the financial statements!

[John Reed Stark @JohnReedStark]

@materialitychck This is possibly a hidden windfall for anyone who invests in Google. Crazy that the stock price might not have this fully priced in because of accounting rules. Google’s $900 million stake will be worth $112 billion. For context, Google’s latest annual income was $98 billion!

[John Reed Stark @JohnReedStark]

@Matt_Pinner Ferris Bueller's Day Off -- great flick!

[John Reed Stark @JohnReedStark]

My pal Bret Padres composed a what-if video (a new history) for me. Turns out my anti-crypto vibe was all a dream and I was pro-crypto all along. Fare the well cryptoverse, this is my swan song. Reverting back to my roots of tech/cyber/AI. Peace out bros.
https://t.co/0xvPLVppsR

[John Reed Stark @JohnReedStark]

@SopranosWorld

[John Reed Stark @JohnReedStark]

@pablofindsout @PabloTorre

[John Reed Stark @JohnReedStark]

Say it ain’t so Kawhi.

[John Reed Stark @JohnReedStark]

@TheDunkCentral @PabloTorre

[John Reed Stark @JohnReedStark]

@LegionHoops