Our Reply Is In. Now Finish the Record and Decide.
Our October 23 reply and proposed findings are filed. Here is what we argued, what the evidence says, and why the record does not formally close until November 20.
We filed our reply brief yesterday. We also filed our proposed findings of fact.
Our answer to the Texas State Securities Board is still the same: set the Emergency Order aside. All of it.
Not dress it up. Not swap out the allegations that didn't survive the hearing and call that a correction. Set it aside.
Our October 23 reply and proposed findings are filed. Here is what we argued, what the evidence says, and why the record does not formally close until November 20.
We've spent months putting the evidence where everyone can see it. Four days under oath. The transcripts. The exhibits. Our opening brief. Now the reply, with the testimony and the law right next to the arguments.
I believe we've made the case. What we haven't received is a ruling.
And before anybody gets the wrong idea from the headline: the record is not formally closed today. The judge's October 19 order says it closes November 20, when both sides file their joint stipulation of undisputed facts. Her proposed decision is due January 25, 2027.
Our reply is in. There's still paperwork left. And apparently, more waiting.
What we filed
On October 23, our attorneys submitted two documents in TSSB v. TEXITcoin, SOAH Docket 312-26-14427:
- Our post-hearing reply brief: the answer to the Enforcement Division's October 9 arguments and the questions the judge asked both sides to address.
- Our proposed findings of fact: 154 proposed factual findings, followed by seven proposed legal conclusions. 161 numbered items altogether.
That second document matters. It takes the argument out of the clouds and puts it next to a transcript page, an exhibit, or a specific part of the record.
But the word proposed matters too. These are the findings we're asking the judge to make. They're not findings she has already adopted. We don't get to declare a court victory by writing our own conclusion at the bottom of a document.
We do get to show you what we filed and why we stand behind it.
They accused us of concealing things we were discussing in public
This is the part I still have trouble getting past.
The Emergency Order accused us of intentionally concealing information. My history. The mining operations. The people running them. The use of funds. Problems with hardware and power.
We talked about those things on recorded calls. We put information on the website. We answered questions. We showed the problems while we were working through them.
Our reply walks through the disclosures and the State's acknowledgment of them. On the old Mulligan Mint bankruptcy, for example, the reply quotes the State's own brief acknowledging that I “did not literally remain silent about Mulligan Mint or the bankruptcy throughout the life of the offering.” On financial and operational information, it identifies the website, the recorded calls, the dashboard, and the testimony about what the investigator knew. See our reply, printed pages 8–12.
So now the argument becomes that the disclosures weren't standardized enough. That people weren't required to read them. That the presentation should have looked different.
Our answer is straightforward: show us the law that required that process, and show us where you charged us with violating it.
A complaint about how information was presented isn't automatically proof that someone intentionally concealed it. Our reply challenges the claimed legal duty, intent, materiality, reliance, and injury. Those are things the State has to establish under the fraud-by-omission standard our attorneys argue applies here. They're not boxes it gets to skip because the word “fraud” sounds serious. See printed pages 2–8.
What the investigator actually said about harm
There are two short lines in our reply that deserve to be read without anyone improving them for effect.
The State's investigator acknowledged there was:
“no allegation he embezzled any funds”
And:
“no allegation that purchasers didn't, in fact, receive their TEXITcoin.”
Those quotations are in our reply on printed page 28, citing hearing transcript Volume 2, pages 122:2–6. The same section cites his acknowledgment that purchasers received daily TXC distributions.
That's important. It goes directly to the picture painted by an emergency enforcement action.
But I'm not going to turn it into something it doesn't say. It does not mean nobody ever lost money buying or trading TXC. A coin's market price can go down. People can buy high and sell low. We've never promised otherwise.
Our argument is that the State did not establish the fraud or the immediate and irreparable public harm needed to support this Emergency Order. That is different from claiming there were no disappointed purchasers, no complaints, or no trading losses anywhere.
We don't need to exaggerate the testimony. The actual words are strong enough.
Eleven months of investigating. Then an emergency.
The investigator described an investigation beginning in March 2025 and continuing until the February 2026 order. Our reply points out that he never contacted me or sought to freeze funds or other assets. See printed page 28 and proposed findings 3–6.
Think about that.
Eleven months to investigate. No visit to the mine. No request to me for records. No conversation with me before the order.
Then an emergency.
The judge specifically asked whether immediate and irreparable harm should be measured when the order was issued or at the hearing, and what effect stopping sales afterward should have. Our reply's answer is that neither immediate nor irreparable public harm existed at either time. See printed pages 28–29, including footnote 7.
I'm not going to invent a more precise shutdown timestamp than these filings establish. Nor am I going to confuse the temporary shutdown after the order with the later reopening outside Texas. The Texas restrictions remain in place.
The point of our legal argument isn't simply that sales stopped. It's that the State had to establish a real basis for using emergency power in the first place.
Buying hash power is not buying shares in my business
TEXITcoin is a community currency. TXC is mined. Its value depends on what people do with it and what the market is willing to pay for it.
A mining package gave its purchaser a proportional daily allocation of mined TXC. It did not give them equity in a company, a share of my business profits, or an ownership stake in the enterprise. Our reply sets that out on printed pages 15–16.
The State's securities argument concerns the mining packages. Our reply notes that the State does not allege TXC itself is a security. Those aren't interchangeable questions.
The home-mining comparison makes the problem especially clear. Some people operated equipment at home. Others used hosted equipment. Same price. Same allocation formula. Same underlying computational work.
Our argument is that choosing someone else to handle the power, cooling, and maintenance doesn't magically turn that arrangement into an investment contract. Those supporting tasks are what our attorneys describe as ministerial work, not the essential investment-management work the State's theory requires. See printed pages 17–23.
More machines mean more work. They don't necessarily mean a different kind of work.
And I can't make a community currency valuable by decree. I said that under oath:
“I can plug the mining hardware in, but I can't force people to trade it and accept it and spend it and circulate it.”
Our reply quotes that on printed page 23, citing Volume 1, pages 213:13–20.
That's not a loophole. That's how a community currency works.
The SEC guidance belongs in this conversation
The judge asked what weight the SEC's March 2026 crypto guidance should receive under the Texas investment-contract test, including for purchasers who didn't operate their own equipment.
Our reply answers that directly. It argues Texas securities law should be interpreted in harmony with federal securities law, and that the guidance describes the supporting work of a proof-of-work pool operator as administrative or ministerial. See printed pages 17–21.
The reply also cites the SEC's newer FAQ language about work to secure, maintain, improve, or enhance a functioning system, and to facilitate network effects, not involving essential managerial efforts. That's the discussion we've been having about FAQ 2.3. See printed page 21.
Does federal guidance automatically dismiss our Texas case? No.
Does it matter when Texas is trying to classify the same sort of work in the opposite direction? We believe it matters a great deal. That's why it's in the brief, not just in a blog post.
You don't get to replace the case after the hearing
Our reply identifies the changes the State wants: revised fraud theories, different treatment of the names in the order, a mining-package resale theory, and a monetary remedy that wasn't in the Emergency Order.
The fair-notice argument is simple enough that you don't need to be a lawyer to understand it.
Tell us what we're accused of. Give us a fair chance to answer it. Then decide that case.
You don't get to wait until the witnesses have gone home, replace the allegations, and say the hearing covered the replacement version too.
That's our position. The State disagrees. The judge decides. See our reply, printed pages 29–33.
The refund demand still needs authority and evidence
The judge asked whether this emergency-order proceeding can support refunds at all. She also asked why the State's initial brief sought the full amount paid when the Notice of Hearing described principal less returns or profits.
Our reply challenges both the authority and the calculation. See printed pages 33–35.
What happens to TXC already delivered? What happens to commissions and bonuses? What happens when one miner paid another miner rather than paying me?
The reply identifies roughly $46.1 million in peer-to-peer purchases recorded in our sales ledger — payments to other purchasers, not to me. That isn't a minor bookkeeping detail in a demand built around money supposedly paid to the dealer.
Our position is that the State has neither the proper legal vehicle nor the evidentiary foundation for the relief it wants. No refund ruling has been issued. I'm explaining our filed answer, not announcing an outcome.
The reply also reserves our right to seek sanctions for what our attorneys describe as frivolous fraud allegations. It doesn't say sanctions have been awarded. They haven't. See printed page 35.
What's left before the record closes?
Both sides must confer and file a joint stipulation of undisputed facts by November 20.
Plain English: a single list of facts the parties agree the evidence establishes.
It isn't a settlement. It doesn't require either side to agree with the other's legal conclusions. But it does mean accepting that a listed fact is accurate. The judge's order expressly says either side can still dispute that fact's relevance or materiality.
That's more precise than saying it “doesn't concede anything.” It concedes the fact. It doesn't concede the case.
Under the October 19 order, the evidentiary record closes November 20 upon the filing of that stipulation. The proposed decision is due January 25, 2027. Those dates remain subject to any later order.
After the proposal, the parties can raise exceptions through the administrative process before the final agency decision. January 25 is the deadline for the judge's recommendation — not a promise that the entire matter ends that day.
Our position hasn't changed
I'm proud of what we put on the record.
Not because our lawyers found a clever way to avoid the facts. Because we showed up and answered the questions, and our filings point back to the evidence.
We believe we delivered what people bought. We believe we were transparent. We believe the mining packages are not securities and the fraud allegations fail. We are asking the judge to set the order aside in its entirety.
We're not apologizing for building a community currency. We're not turning an ambitious plan into a guaranteed return. And we're not going to stop building simply because the paperwork takes longer than it should.
Read the reply. Read the proposed findings. Check the citations.
Our answer is in. Now let's finish the record and get a decision.
— Bobby
Read the filings and check the dates
This is my account of our position in a pending administrative case, based on the public filings. Proposed findings and legal arguments are not judicial rulings. References to reply pages mean the brief's printed page numbers, not the PDF viewer's counter. The official record and any subsequent orders control.
Mine, hold, and use TXC.
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