Data Shows High-Value Investors Are Buying The Dip Despite Bombshell SEC Lawsuit Against Binance

The crypto industry’s latest blow rocked digital assets’ prices on Monday.

The world’s largest cryptocurrency by market cap, Bitcoin, recently traded hands at around $25,496, down 4.54% over the past 24 hours. The downturn started after the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against crypto behemoth Binance, the operating company for Binance.US, and Binance founder and CEO Changpeng “CZ” Zhao on allegations of breaking federal securities rules.

Despite the carnage, recent analysis shows that some major crypto players are buying the dip.

Whales Accumulate

Bitcoin may have taken a serious hit yesterday, but not every class of crypto investor is dashing to the exit.

The total crypto market capitalization plunged over 3.5% overnight as the SEC sued Binance. Bitcoin had been treading comfortably above the $27,000 level for the better part of last week, but the charges against the leading crypto exchange rekindled fears about industry integrity and the intention of regulators to exert more authority over trading platforms.

The SEC also alleged that a couple of tokens, including the native coins for the Solana (SOL), Cardano (ADA), Polygon (MATIC), Coti (COTI), and Algorand blockchains (ALGO), Filecoin network (FIL), Cosmos hub (ATOM), Sandbox platform (SAND), Axie infinity (AXS) and Decentraland (MANA) are unregistered securities.

Nonetheless, on-chain data indicate that some larger market participants are scooping up crypto at the dip.

On-chain analytics tool Lookonchain said on Tuesday that Cumberland — a prominent liquidity provider in digital assets — withdrew approximately 67.8 million USDC from Circle and deposited 67.1 million of the stablecoins to U.S.-based digital assets exchange Coinbase. 

Crypto Prime brokerage FalconX also acquired 37 million USDC from Circle before sending 29.5 million USDC to Binance. Additionally, as per etherscan, Asian investment firm FBG Capital deposited 44 million USDT to Binance shortly after the news of the SEC lawsuit went public.

Lookonchain also identified a crypto whale that withdrew 703,871 USDC and over 2.5 million USDT from decentralized finance (DeFi) protocol Aave before purchasing $3.35 million worth of ether.

Is This Dip Worth Buying?

While the pain that this most recent capitulation has wrought across the market can’t be understated, the one glimmer of hope it offers weary crypto traders is that the worst of the decline could be over as high-net-worth investors are already stepping in to buy the dip.

Nevertheless, regular retail crypto traders should proceed with extreme caution. 

When crypto prices plummet as rapidly as they have in the market recently, it can make that token you’ve been eyeing look like a great deal. But old Wall Street experts have a rule of thumb that aptly explains moments like this: “Never try to catch a falling knife.”

This means pro traders could make a buck trading on increased market volatility, but further downside could occur shortly.

Trader Crypto Tony suggests that Bitcoin could see a short-term bounce before a fresh tumble toward the $24,500 region.

“Shed some more profit on my short this morning, but now looking for a relief wave before the final leg down towards $24,500. I anticipate this is the final leg down before we accumulate for pump to come July / August,” he tweeted.

XRP Price Crosses $0.5 Milestone As Trading Volume Explodes — A ‘Ripple Win’ In SEC Case Imminent?

XRP, a digital coin often used to make international payments, has stolen the crypto market spotlight once again after hitting the key $0.5 resistance mark— a potential signal of how investors feel regarding an ongoing legal battle brought by the U.S. Securities and Exchange Commission (SEC) against associated blockchain payments firm Ripple.

XRP posted as much as 5 percent in gains over the past 24 hours to trade at $0.511 at the time of writing, according to CoinGecko data. The upward price action was accompanied by an impressive 82.37% spike in trading volume during the same timeframe.

XRP Making Waves

XRP has been on a roll in recent days following reports the SEC’s landmark case against Ripple was tilting in favour of the San Francisco-based firm. Today, a sudden spike in trading volume hurled the XRP price above the important $0.5 level.

XRP currently has a $26 billion market cap, which translates into a 24-hour increase of 4.68 percent. Perhaps even more notably, XRP is the top gainer among major tokens as it is now up 13.46 percent over the past seven days.

On-chain analytics firm Santiment recently pointed out that XRP has enjoyed the second and third-largest surges in address activity in history in the last 2 days. Compared to a similar occurrence on March 18, expecting further price appreciation for XRP is reasonable. Should history repeat itself, the token’s price could jump 45% in the space of 10 days following the latest increase in activity.

What’s Next For XRP Price?

There does not appear to have been a clear catalyst for today’s XRP upsurge. However, it could be an indication that the bulls anticipate some truly good news about XRP and its ecosystem in the near future. For one, some insiders believe the SEC v. Ripple case is about to come to an end. Finally.

Notably, U.S. District Judge Analisa Torres recently dismissed the SEC’s motion to seal the Commission’s internal communications that occurred before a speech by its former director, Willian Hinman, in June 2018. In that speech, Hinman posited that the Ether token is not a security asset.

The unsealing of these documents could push Ripple toward a critical legal victory, given its ability to prove that XRP is also not a security. 

Ripple CEO Brad Garlinghouse has expressed confidence that a final verdict in the lawsuit could be coming “in weeks”. Ripple’s win will undoubtedly set off a mega-bullish impulse for XRP as well as bring cheer to the broader crypto market, but a defeat could rekindle risk aversion.

Binance Has A Master Plan To Manage Crypto Risk By Letting Traders Hold Collateral In Banks

The implosion of Sam Bankman-Fried’s FTX empire is easily one of the most gruesome incidents in the crypto industry’s history. The FTX case underscores the risks of participating in the cryptocurrency market. In particular, it brings to the forefront the prevalence of counterparty risk in crypto.

The world’s largest cryptocurrency exchange by trading volume, Binance, has come up with a potential solution to offset this risk, according to Bloomberg. Binance wants to let select professional customers keep their trading collateral funds at a bank rather than on crypto platforms.

Binance Looks To Eliminate Counterparty Risk

Binance could soon move forward with a strategy to allow some of its traders to store their collateral in banks, thus eliminating counterparty risk.

For those unaware, counterparty risk is the measure of how likely one of the parties involved in a transaction is to default on their end of the bargain and how huge the damage is if they do.

Anonymous sources familiar with the matter told Bloomberg that Binance has engaged in talks with some institutional clients regarding the prospective plan that would enable them to employ bank deposits as collateral for margin trading.

Per the news publication, one possible arrangement would involve locking clients’ cash at a bank through a tri-party agreement while the exchange lends the customers stablecoins that would then serve as collateral for margin trading in both spot and derivatives markets. These collateral funds deposited in banks could be invested in money market funds, allowing clients to accumulate interest and offset the expense of borrowing crypto assets from Binance.

Binance Explores Collaboration With Banks

Two banks — Europe-based Bank Frick and FlowBank — have been floated in conversations about the project, although details of any potential partnership remain confidential. Moreover, Binance is yet to finalize the plan, and the arrangement is still subject to modification. 

Nonetheless, the move comes as Binance and other crypto trading firms face immense pressure to guarantee safety in the event of unprecedented failure following the spectacular collapse of FTX last November, which brought about substantial permanent losses for institutional and retail traders.

In a recent interview, Binance CEO Changpeng Zhao revealed that the exchange had briefly considered purchasing a bank and making it crypto-friendly, but ultimately decided against it due to strict regulations, the risks involved, and underwhelming profit expectations. Zhao noted:

“Banks are not cheap. Banks are very expensive for very little business revenue. […] The amount of capital required is quite high, and the regulatory approval for buying a bank is the same or more as setting up a new bank, which is very onerous If the banking regulators say, ‘Look, you can’t work with crypto’ then they can take your license away if you do. So buying a bank doesn’t prevent regulators from telling you, “No, you can’t touch crypto.” Even then, we would need corresponding banks all over the world.”

FOMO Will Kick Into High Gear When XRP Price Roars Past $2, Predicts Pro-Ripple Attorney

XRP holders’ counsel John E Deaton, known for his commentary on Ripple’s pending lawsuit with the U.S. Securities and Exchange Commission (SEC), has predicted that FOMO will set in when the XRP price taps $2.

Deaton Is Mega Bullish On XRP Price

Looking to mainline the XRP community with a healthy dose of hopium is CryptoLaw founder John Deaton. Amid the plethora of bearish opinions as the SEC vs. Ripple lawsuit rages on, Deaton came out bullish as ever, highlighting XRP’s prospects.

He alluded that it is crazy to think that many people will not buy XRP at its current $0.48 price tag. However, he is confident that these same people will buy the token when it will be worth over $1. Even more interesting is that Deaton expects many investors to FOMO into XRP once its price surges above the impressive $2 mark.

There’s an old saying on Wall Street that financial markets are propelled by two emotions, fear and greed. In the cryptocurrency markets, the driver is usually a combination of the two: fear of missing out ( FOMO).

XRP is trading 1.3% higher intraday, pushing the sixth-largest cryptocurrency’s market cap beyond $25 billion. Currently trading hands at $0.499, XRP has every reason to reclaim the $2 level as the crypto traded at a historical high of around $3.40 over five years ago, as per CoinGecko.

XRP Gearing Up For A Comeback

Most pundits in the crypto market who have closely followed the price performance of XRP in recent years have noted that the legal battle between Ripple and the SEC has caused considerable damage to the token.

Part of the lawsuit has centered around whether Ripple sold XRP tokens as unregistered securities. Most prospective investors and Ripple partners have stayed on the sidelines since the lawsuit was initiated in December 2020 amid regulatory confusion in the United States. This has greatly affected the price of XRP over the years.

The current consensus in the crypto community is that XRP will soon recoup all its losses and dart higher after the lawsuit reaches its conclusion.

Bali Bans Bitcoin Payments In Crypto Crackdown Targeting Foreign Tourists

While crypto trading is still legal in Indonesia, local authorities in Bali have warned that international tourists who use cryptocurrencies such as Bitcoin to make payments will be “dealt with firmly”.

Bali Forbids Crypto Payments

On May 28, Bali Governor Wayan Koster said during a tourism development press conference that visitors who pay with crypto will be subject to punishments such as deportation, criminal penalties, and administrative sanctions.

“Foreign tourists who behave inappropriately, do activities that are not allowed in their visa permit, use crypto as a means of payment and violate other provisions will be dealt with firmly,” the leader of the popular island vacation destination in the Indonesian archipelago stated.

Additionally, businesses caught accepting cryptocurrency payments will also be punished and forced to shut down.

Koster stressed that all transactions carried out in Bali must be settled in Indonesia’s currency — the rupiah. The use of other currencies for payments carries a maximum potential sentence of one year behind bars and a fine of as much as 200 million rupiah (equivalent to $13,000 USD).

Indonesia’s Upcoming National Crypto Exchange

Trisno Nugroho, the head of the Bali Representative Office for Bank Indonesia — the nation’s central bank — reiterated during the Sunday meeting that crypto trading is allowed in the country, but its use as a means of payment is illegal.

The announcement is the latest in a slew of efforts to clamp down on unacceptable tourist behaviour on the island. Notably, tourism is a major contributor to Bali’s economy. Research indicates that tourism accounts for nearly 28% of Bali’s income. The island suffered a big blow from COVID-19 travel restrictions. Yet, banning crypto payments for goods and services by tourists will likely lead to a drop in income as some are already reconsidering their plans to visit Bali.

Despite the staunch stance from Bali’s governor and Indonesia, the country is on the path to launching a national crypto stock exchange by next month. The Indonesian government initially planned to roll out the crypto bourse by 2021-end but encountered multiple delays.

XRP Lawsuit: Ripple Boss Confident Groundbreaking Verdict Is Coming ‘In Weeks’ After Hinman Speech Docs Win

Ripple chief executive officer Brad Garlinghouse believes a ruling in its costly lawsuit with the U.S. Securities and Exchange Commission (SEC) is coming soon. Garlinghouse expects a verdict in weeks and not months after the recent court news concerning the Hinman documents.

XRP Suit Could Be Over Sooner Than You Think

Bradley Garlinghouse has hinted that a court case resolution is coming immediately after the release of the infamous William Hinman materials.

In a recent interview at Redefine Tomorrow 2023 summit, Garlinghouse revealed that in terms of where things currently stand in the courtroom war with the SEC, he is confident of getting a decision in the coming weeks. 

The Ripple CEO pointed to the recent court ruling where the SEC’s motion to keep Hinman documents under wraps was rejected by a federal judge.

Back in 2021, Ripple cited the landmark Hinman speech as an indication that the SEC does not deem Bitcoin or Ethereum as a security, contending that XRP should not be classified as a security either. The crypto payments firm then filed for Freedom of Information Act request which would uncover docs explaining how Hinman came to this conclusion.

At the time, the SEC responded by claiming Hinman’s speech represented his personal opinions and not the agency’s policy. To that end, the SEC wanted to shield the documents relating to this speech from the public eye while also arguing that the materials are protected by a statute that grants privacy for internal deliberations. 

But as ZyCrypto reported recently, the court believes that these speech drafts and emails are judicial documents and should be made public. The move was viewed as a key win for Ripple, which believes that these internal deliberations and discussions are key evidence in its ongoing litigation. 

Hinman Emails To Give Ripple The Upper Hand?

Commenting on the upcoming unmasking of the Hinman materials, pro-Ripple attorney John E Deaton noted:

“I can’t wait for these emails to be released. I predict even non-XRP holders, including Ripple critics, will have to objectively say that what the SEC did is flat-out wrong. The inquiry about the motive behind this lawsuit will go into a higher gear — mark my words.” 

Spectators are now waiting for the summary judgment decision after completing all the briefings. Garlinghouse’s comment that he expects a verdict in weeks’ time is being interpreted by some in the XRP community as an indication that he anticipates a favourable decision by the presiding judge.

Huobi Ordered To Suspend Operations In Malaysia In Latest Crypto Hit

On Monday, the Malaysian Securities Commission (SC) ordered Seychelles-headquartered cryptocurrency exchange Huobi Global to cease activities in the country.

The regulator said Huobi was operating a digital asset exchange in Malaysia without the appropriate registration. Operating a crypto exchange without a Recognised Market Operator (RMO) license is a crime under the Capital Markets and Services Act 2007.

Huobi Terminates Crypto Services In Malaysia

The SC has served a public reprimand against one of the largest and most trusted crypto exchanges globally, Huobi, and its founder Leon Li. As the company’s CEO, Li has been mandated to supervise the process of winding down local activities, discontinuing any advertisements to Malaysian investors, disabling the website, and removing the mobile application from app stores. 

Huobi’s Malaysian investors have been urged to withdraw all their investments from the platform and close their accounts.

The SC’s statement says the enforcement action against Huobi was driven by “concerns about the platform’s compliance with local regulatory requirements and protecting investors’ interests.”

Malaysia’s securities regulator further encouraged citizens to stop trading with cryptocurrency exchanges in the country illegally.

At the press time, the native token of Huobi Global, Huobi Token (HT), is trading hands at $2.95, up by 1.21% in the last 24 hours. 

Huobi is presently the fourth-largest crypto exchange in the world by trading volume, according to CoinGecko. The exchange has fallen foul of Malaysia’s markets regulator in the past. Back in August 2022, the Securities Commission Malaysia warned Huobi of operating without a license and added it to a list of companies not permitted to operate in the country. At the time, Huobi claimed that it was in talks with Malaysian regulators about its regional operations.

The Malaysian regulator’s action marks the latest blow to the crypto industry, which has been facing regulatory pressure from various countries in the world — most notably the United States. The U.S.’s lack of clarity and regulation by enforcement has spooked many crypto companies and investors, who are already looking to relocate to other friendlier jurisdictions.

One Of Ripple’s Defense Lawyers Drops Out Of SEC Lawsuit — Does It Spell Doom For XRP?

In a blow to Ripple, one of its attorneys in the long-running legal dispute with the U.S. Securities and Exchange Commission (SEC), Kylie Chiseul Kim, has called it quits. This departure comes as the XRP community expects a summary judgment ruling any day now.

What Does The Departure Mean For The Case?

Attorney Kylie Chiseul Kim has left Ripple Lab’s legal team as the case drags on.

According to the letter filed in the Southern District of New York, Kylie noted that she would no longer have any association with Kellogg, Hansen, Todd, Figel & Frederick, P.L.L.C., the law firm presently representing Ripple. The filing indicated that other lawyers from the same law firm and those from Debevoise & Plimpton LLP would continue being counsel for the defendants. Notably, Kylie’s motion was granted by the court.

Kylie has long been a key member of the team representing Ripple since July 2022. She was hired alongside Clayton J. Masterman as Ripple was still battling the 2020 XRP lawsuit with the SEC. The U.S. regulator accused Ripple, co-founder and former CEO Chris Larsen, and current CEO Brad Garlinghouse of misleading investors by raising over $1.3 billion in unregistered securities offerings of the XRP token. The onboarding of these two attorneys at the time was viewed as a move to bolster Ripple’s legal team for an expected lengthy legal fight.

Kylie’s surprising departure has left many wondering whether it seals Ripple’s fate in the case. There were mixed reactions to the news of her leaving Ripple’s defence team. Nonetheless, the majority believe her exit had nothing to do with Ripple and did not reflect her view of Ripple’s stakes in the lawsuit but was related to her quitting her former law firm.

The departure, nonetheless, comes as the crypto community anxiously awaits the unsealing of the “Hinman documents” on June 13. These docs relate to a 2018 speech given by former SEC Director William Hinman and emails associated with writing it. In the speech, Hinman declared that Ether was not a security due to its decentralized nature. These documents are believed to tip the scales in Ripple’s favour as the company endeavours to prove that XRP should not be considered a security.

Terra’s Do Kwon Back In Jail After Montenegro High Court Revokes Bail Status

In a surprising turn of events, Terraform Labs founder Do Kwon is back in custody after a Montenegrin high court annulled a lower court’s decision to allow Kwon to be released on bail.

Do Kwon’s $436K Bail Scrapped

Do Kwon and former chief financial officer Han Chong-joon are back in jail, per a Bloomberg report.

This comes after the high court of Montenegro in Podgorica nullified a decision from two weeks ago to release Kwon and Han to house arrest on 400,000 euros ($436,000) bail each.

After the Basic Court in Montenegro granted the pair bail, prosecutors in the case swiftly appealed the decision. Court spokeswoman Marija Rakovic told Bloomberg that the matter will now head back to the lower court, which must make a decision taking into consideration what the higher court decided.

Kwon and Han were charged with using a fake passport in Montenegro after attempting to travel to Dubai from Podgorica in March with fake Belgian and Costa Rican passports. The two defendants maintain that the passports were issued legally.

TerraUSD, the algorithmic stablecoin designed by Terraform Labs, imploded last spring along with governance token Terra (LUNA), erasing over $40 billion in investors’ wealth and triggering a snowball crisis in the crypto industry last year. Shortly after the catastrophic Terra ecosystem collapse, Three Arrows Capital, Voyager Digital, and Celsius all declared bankruptcy. 

Besides the forgery charges, Do Kwon is also facing criminal fraud charges in the U.S. and also back in his home state South Korea. S. Korea issued an arrest warrant against him last September, alleging that he violated capital market laws. As ZyCrypto previously covered, he faces up to 40 years in jail in South Korea, the country where he supposedly committed most of his crimes.

U.S. prosecutors in New York have charged Kwon with eight counts, including commodities fraud, securities fraud, wire fraud, and conspiracy to manipulate the market.

In the meantime, both the U.S. and South Korea have sought to extradite the Terraform Labs boss from Montenegrin authorities.

Ripple Buys Shares In European Crypto Exchange Bitstamp: Massive XRP Growth Ahead?

Amid legal tensions and murky regulations in the United States, Ripple has seemingly decided to expand overseas. The San Francisco-based blockchain payments firm has reportedly acquired a stake in the European cryptocurrency exchange, Bitstamp.

Ripple Expands European Foothold

Ripple Labs is continuing to make power moves.

According to Galaxy Digital’s First Quarter 2023 report, Ripple purchased shares of Bitstamp — one of the world’s oldest and most established crypto exchanges — which were previously held by crypto VC firm Pantera Capital.

Galaxy says it advised Pantera to sell its stake in Bistamp to Ripple in Q1. It’s unclear how much the acquisition cost Ripple. Bitstamp is currently the seventh-largest cryptocurrency in terms of trading volume, with around $163 million worth of cryptocurrencies traded in the past 24 hours, according to CoinMarketCap.

This Ripple purchase deal comes as Galaxy Digital’s Investment banking team posted stellar growth in the past year, fortifying its position as a leading investment bank for digital assets post-FTX.

What Does The Acquisition Mean For XRP?

The purchase grabbed the XRPArmy’s attention, who uncovered that Pantera had previously invested in both Ripple Labs and Bistamp.

Notably, Bitstamp is presently the second-largest market for XRP after Binance. Additionally, the exchange previously served as a gateway for Ripple, enabling entry into RippleNet. As we speak, XRP now accounts for 30% of the total trading volume on Bitstamp, with the XRP/Euro pair being the most popular.

The community is trying to make sense of why Ripple proceeded with the deal, as neither the payments firm nor Bitstamp has made an official statement on the matter. Some speculate that the acquisition may be connected to Ripple’s objectives for its Liquidity Hub (LH) or On-Demand Liquidity (ODL) services. It’s worth mentioning that Ripple’s popular ODL solution uses XRP to settle transactions, while the LH does not include the token.

While the specific details and importance of the deal will probably be revealed at a later date, it signals Ripple’s move to boost its offerings further, considering its recent acquisition of Switzerland-based crypto custody firm Metaco for $250 million in tokenization push. Whether the latest Bitstamp deal boosts XRP liquidity remains to be seen.

XRP Lawsuit: Billionaire Mark Cuban Explains How Crypto Projects Can Avoid Being Targets Of SEC Crackdown

Billionaire investor, “Shark Tank” personality, and Dallas Mavericks owner Mark Cuban shared a proposal on Tuesday about how cryptocurrency tokens should be decentralized in the future to avoid being on the receiving end of SEC enforcement actions.

Cuban’s Proposal

It all started when the U.S. Securities and Exchange Commission (SEC) asked Grayscale to pull its application to make its Filecoin Trust product more akin to a public company, warning that its underlying asset, Filecoin (FIL), “meets the definition of a security.”

Mark Cuban commented on a tweet regarding Filecoin being labelled a security by the SEC and shared some tips on how future crypto-focused firms could become completely decentralized to avoid facing lawsuits from the U.S. regulator for securities violations.

The American billionaire investor noted that cryptocurrency-issuing companies should consider releasing all their supply without retaining a portion as a treasury. According to Cuban, the released tokens should be used to provide liquidity using DeFi, and the original entity that issued the tokens should thereafter be dissolved. In his view, rogue regulators like the SEC will not be able to “close the token down” alleging it’s a security as it has done with cryptocurrencies like FIL, and XRP, as there will be “true decentralization”.

XRP Holders’ Lawyer Agrees

John E Deaton, a prominent pro-crypto lawyer and legal representative of XRP holders, has concurred with Mark Cuban’s suggestion. Deaton posited that it is “smart and probably in someone’s playbook at the moment.”

However, the CryptoLaw founder emphasized that the crypto community must continue pushing against the false narrative propagated by the SEC that the underlying asset in an investment contract is a security.

The SEC claims that Ripple distributed 14.6 billion units of XRP and sued the company and its former and current CEO, Chris Larsen and Brad Garlinghouse, respectively, for failure to register XRP as a security, which is a requirement for the public offering and sale of securities. 

Ripple has historically maintained a distance from XRP, but any progress in the long-standing lawsuit has had an impact on the token’s prices. Most recently, XRP surged after a federal judge ruled that the SEC cannot seal materials tied to former official William Hinman’s 2018 speech on ether not being a security. Access to these emails would mean Ripple attorneys can discover how Hinman came to that determination, which could influence XRP’s classification as a security.

Deaton recently noticed that XRP was in fact, discussed between SEC staff just before the Hinman speech. 

The community should keep a keen eye on June 13, 2023, where we will learn to what extent this will affect the XRP suit, which is when the Hinman documents are set to be unsealed.

Dogecoin’s Future Is Crushingly Bleak As Dogefather Elon Musk Warns Investors Against ‘Betting The Farm’ On DOGE

Elon Musk, at least at one point the world’s richest man, has issued a grim warning about the original meme cryptocurrency, Dogecoin (DOGE).

Speaking at the Wall Street Journal’s CEO Council Summit in London on May 23, the eccentric billionaire cautioned investors not to allocate all their money to DOGE. “I’m not advising anyone to buy crypto or bet the farm on Dogecoin,” Musk posited.

Despite this warning, the Tesla/SpaceX CEO reaffirmed that Dogecoin remains his favourite crypto in the entire digital currencies market because “it has the best humor and has dogs”. Musk also noted that the most ironic outcome for global currencies would be if a meme coin created merely as a joke emerged as the global currency. As you are well aware, DOGE was invented as a joking tribute to the “doge” meme of a Shiba Inu dog. The idea was to poke fun at the largest and oldest crypto asset, Bitcoin.

Musk’s History Of Endorsing And Pumping Dogecoin

Musk is known for manipulating the price of dogecoin in the past through his intriguing remarks, actions, and Twitter posts. The self-proclaimed “Dogefather” even planned to bring DOGE to space with a SpaceX satellite launch. Dogecoin developers have also revealed in the past that Chief Twit Musk actually sat in on development calls as they discussed how they would revamp the meme coin. 

The entrepreneur still owns dogecoin, along with Bitcoin and Ethereum, according to his tweets from March last year. Musk even bought some DOGE for his youngest son, X Æ A-Xii, in 2021.

There was speculation that the Tesla boss would soon integrate a permanent Dogecoin payment system on Twitter, the social media giant he overpaid for ($44 billion). However, DOGE’s integration has not yet materialized, leaving fans in a state of great disappointment.

Early last month, Musk replaced Twitter’s classic blue bird logo with a sprite of DOGE, triggering a 25% spike in the token’s price — only to remove the Dogecoin logo days later.

Dogecoin dropped sharply today after Musk said not to put life savings in DOGE. The OG meme coin was down 2.8% at the time of writing, trading for $0.071, according to CoinGecko data.

DOGE is currently trading 90.25% lower than its May 2021 all-time high of $0.73.

FTX Token FTT Pumps As Holders’ Hopes Of Exchange Reopening Soon Swell

FTX’s new management, led by CEO John J. Ray III, is considering a rebirth of Sam Bankman-Fried’s defunct crypto exchange, according to the latest legal billings.

The new CEO reportedly spent several hours last month examining and working on what seems to be FTX 2.0 materials.

FTX 2.0: Latest Court Filings Hint There Is Work Underway To Reboot Collapsed Crypto Giant

The FTX crypto enterprise filed for bankruptcy last November, shocking the global crypto markets, with its founder and former CEO Sam Bankman-Fried facing fraud charges in the United States.

Now, the struggling crypto exchange is considering reopening at some point in the future.

The monthly staffing report and compensation details for the new CEO of FTX, John J. Ray III, shows that during this time, he engaged in a series of activities that might enable the reboot of the cryptocurrency trading platform.

Ray first floated the idea of restarting FTX in January this year. “Everything is on the table. If there is a path forward on that, then we will not only explore that, we’ll do it,” Ray posited. At the time, there were reports that the failed exchange had uncovered and retrieved $5.5 billion in liquid assets and that Ray was working with creditors on a potential revival plan. Then last month, another report said FTX had recovered $7.3 billion in assets and was thus considering reviving its crypto exchange operations sometime in the second quarter of next year.

The new court documents indicate that a reboot plan is indeed in the works. In the “Summary of Time and Fees by Professional”, Ray charged $1,040 for less than an hour of work to “Review and finalize 2.0 reboot of exchange material for distribution” to investors. These included seeking help from cybersecurity firm Sygnia to improve the security of the crypto exchange, as well as analyzing a term sheet for restructuring the company as part of the plan.

Fresh Capital Injection Needed

In April, FTX’s lead attorney Andy Dietderich also advocated for an FTX reboot. According to Dietderich, restarting the exchange would require substantial capital, regardless of whether it would offer services to only U.S.-based customers or operate internationally.

The latest court filings suggest FTX will likely be entering a bidding process.

San Francisco-based VC firm Tribe Capital, which was an investor in the exchange before it went under, is allegedly considering leading a fund-raising campaign to jump-start revival efforts. Per Bloomberg, the rebooted exchange would keep the FTX name.

Members of the crypto community have touted the relaunch plan as an opportunity for over a million FTX creditors to be made whole. For one creditor DegenSpartan, FTX 2.0 “is the most likely path to maximum recovery”.

FTX’s native token, FTT, surged 12.8% on Monday following the news of a potential reboot of the collapsed crypto empire of SBF. At press time, FTT is trading at $1.13, according to CoinGecko. The bankrupt exchange’s token was down 98.68% from its $84.18 all-time high set back in September 2021.

Ex-Ripple Exec On Why SEC Might Still Defeat Ripple In XRP Lawsuit Amid Unmasking Of Hinman Docs

A former executive at Ripple believes that despite the odds tilting in the blockchain payments firm’s favor, the U.S Securities and Exchange Commission (SEC) could still win the legal battle. This comes after Judge Analisa Torres ruled that William Hinman’s documents are “judicial documents” subject to a strong presumption of public access and denied the SEC’s motion to keep them hidden.

Why The SEC Could Win

Recent developments in the XRP lawsuit have made investors and observers confident of Ripple’s victory over SEC.

Ripple has been tied up in a lawsuit with the SEC for over two years after the regulator accused the firm of illegally selling XRP — the sixth-largest cryptocurrency by market capitalization, with a total market cap of over $23 billion as of Monday — without registering it as a security.

The former Director of Developer Relations at Ripple, Matt Hamilton, remarked that the potential unsealing of the Hinman docs for public access could tip the balance. Hamilton noted that the whole situation “looks pretty bad” for the SEC’s case against Ripple.

However, the ex-Ripple official believes the outcome of the lawsuit might not align with many people’s expectations because of the complexities of the U.S. regulatory and legal system. Hamilton stressed that Ripple might still be right, but there’s a chance the SEC could emerge victorious.

The Hinman documents pertain to a controversial speech given in June 2018 by the former director of the SEC’s corporation finance division William Hinman. During the speech, Hinman declared that Ether is not a security. These docs contain the SEC’s internal discussions and deliberations encompassing the speech in question.

Could The Lawsuit Finally Be Reaching Its Conclusion?

While it’s still too early to tell what the ultimate outcome of the case will be, recent findings in court filings cast doubt on whether XRP passes the infamous Howey Test. This means the unsealing of the Hinman emails could have a major legal impact on Ripple and its long-standing dispute with the SEC.

As the case unfolds, well-known pro-crypto attorney Fred Rispoli suggested that the summary judgment verdict is already written and could be given “any day now”. Rispoli thinks an outright win for either Ripple or the SEC remains low, but the Hinman emails ruling’s tone appears favourable to the crypto firm.

Echoing Rispoli’s opinion, XRP holders’ representative John Deaton said during a recent Twitter Space that a pivotal court decision in the XRP suit could come down at any time, but he added that it could take another month or longer.

That being said, if the presiding judge does decide that XRP qualifies as a security, the scope could go beyond XRP to other crypto assets, as it would further establish a precedent for future rulings over other tokens. 

Ripple Launches A Novel Platform For Governments, Central Banks Developing CBDCs

San Francisco-based blockchain payments firm Ripple has introduced a platform for governments, central banks, and financial institutions to create their own digital currency. Described as “a frictionless end-to-end solution”, the new platform is based on Ripple’s XRP Ledger and is an improved version of Ripple’s Private Ledger.

Ripple has also joined forces with the Hong Kong Monetary Authority, which acts as the defacto central bank, for the launch of the digital Hong Kong dollar (e-HKD) pilot program.

What Is The Point Of Ripple’s New CBDC Platform?

CBDCs are a hot topic right now. Unlike crypto assets like Bitcoin or Ethereum, CBDCs are controlled and managed by a centralized entity. Per the Atlantic Council’s tracker, only 11 nations have rolled out a central bank digital currency so far, but many other countries are researching and testing the technology.

Ripple has waded further into the CBDC game via the launch of a new platform for creating blockchain-based digital currencies. The Ripple platform allows for the oversight and customization of the entire life cycle of the CBDC, including minting, distribution, redemption, and removal from circulation. The CBDC platform will also let institutions operate and conduct inter-institutional settlement and distribution functions.

Ripple will leverage the power of blockchain technology used for the XRP Ledger and provide a way for government institutions to increase financial inclusion and reduce the risk involved in domestic and cross-border payments.

President of the Republic of Palau, Surangel Whipps Jr, hailed Ripple’s new CBDC platform while describing how it’s enabling them to create their own solutions.

Partnering with Ripple to help create our national digital currency is part of our commitment to lead in financial innovation and technologies, which will provide the citizens of Palau with greater financial access”.

It will be possible for financial institutions to use the platform to oversee the distribution processes involving their digital currency, while end users — both corporate and retail — will be able to hold their CBDC securely and use them to pay and receive payment for goods and services, similar to how banking apps function today. This entails the convenience of offline transactions and as well as accommodating non-smartphone cases.

Ripple is also collaborating with Taiwan’s Fubon Bank to develop a real estate asset tokenization and equity release product using a retail version of the e-HKD CBDC.

Ripple Acquires Crypto Custody Provider Metaco For $250M As XRP Lawsuit Nears End-Game

Ripple has splashed $250 million on Swiss digital asset infrastructure provider Metaco. The move means Ripple is seeking an expansion into providing crypto custody services for institutional investors. The San Francisco-based blockchain firm intends to start giving clients tools to custody, issue, and settle tokenized assets.

Under the terms of the deal, Ripple will become the sole shareholder of Metaco, which will continue to operate as an independent business led by its founder and CEO, Adrien Treccani.

Ripple Shells Out $250 Million For Metaco

Ripple today announced the acquisition of Metaco, financed through a combination of Ripple equity and cash.

Metaco offers digital asset tokenization tools and custody infrastructure for companies to scale new business models in the crypto economy. Harmonize’s main crypto custody product helps customers manage custody, tokenization, trading, and smart contract management throughout the decentralized finance (DeFi) market. The Swiss-based crypto custody firm has already provided its services to the likes of Citi, Bank BNP Paribas, and Union Bank.

“Metaco is a proven leader in institutional digital asset custody with an exceptional executive bench and a truly unmatched customer track record,” said Ripple boss Bradley Garlinghouse in an official statement. “Bringing on Metaco is monumental for our growing product suite and expanding global footprint.”

Metaco hopes to experience accelerated growth in response to Ripple’s established customer base. Ripple presently has customers in more than 50 countries and can deliver payment services in more than 69 markets worldwide. 

For its part, Ripple said diversifying into custody solutions will introduce new revenue opportunities, adding that the purchase is part of its broad strategy to expand its presence outside the United States and its unfriendly crypto regulatory environment.

When Final Verdict In SEC Lawsuit?

The blockchain payments firm is locked in a three-year-long fight with the U.S. Securities and Exchange Commission (SEC). In December 2020, Ripple and two top execs were sued for the unregistered sale of $1.3 billion worth of XRP. Garlinghouse recently estimated that the feud with the SEC will cost the company an astonishing $200 million

As ZyCrypto reported earlier, the presiding judge dealt a blow to the SEC on Tuesday after ruling that the regulator cannot hide internal emails, text messages, and expert reports tied to William Hinman’s June 2018 speech. A decision from the judge in the first half of this year could settle the long-standing SEC v Ripple lawsuit. 

Despite the lingering crypto winter and regulatory tensions, Ripple president Monica Long notes that the company is “uniquely positioned to address the growing institutional crypto custody market, expected to reach nearly $10 trillion by 2030.”

“Prepare”: This Crypto Analyst Says The Next Explosive Bitcoin Rally Is Right Around The Corner

A respected voice on Crypto Twitter has recently shared his opinion on the potential growth trajectory of Bitcoin. Dan Gambardello suggested that the dominant cryptocurrency appears ready to make a big move soon, leaning toward the bulls’ side.

Another Mega BTC Rally Coming?

Strategist Dan Gambardello is expecting a massive Bitcoin (BTC) bull run in the near term.

The Crypto Capital Venture founder and YouTuber recalled in a recent tweet that on a day like today in 2019 (May 16), bitcoin was changing hands at around $8,000 per coin. Many people doubted whether the flagship cryptocurrency would ever recover above $10k, especially after the infamous Black Thursday market crash. The price of Bitcoin was nearly slashed in half within a matter of hours at the time, dropping to as low as $4,600.

Bitcoin, however, regained the losses incurred on that epic Black Thursday within a month and a half or so. After that, the analyst noted, bitcoin continued climbing higher, and in November 2021, it hit a record high of over $69,000. As such, Gambardello is convinced that Bitcoin is on the cusp of a parabolic rally.

The crypto market has recently taken a turn for the worse as a combination of large-cap coins and hyped-up meme-based coins have headed south. After rocketing past $30,000 for the first time in 10 months in April, Bitcoin has struggled to remain at such highs this month.

The largest digital asset by market cap was trading at $27,097.31 at press time, according to CoinMarketCap. Its market cap currently stands at $524 billion, way down from the $1 trillion it surpassed back in November 2021. Bitcoin’s fall comes as investors’ fear over a more stringent crypto regulatory crackdown lingers amid the unfolding debt crisis in the United States. These grave macro headwinds indicate that volatility in crypto is likely to remain.

Nonetheless, some investors are still feeling bullish, according to data from crypto analytics provider Glassnode: individual bitcoin wallets holding one whole BTC or more passed the millionth mark on Monday, showing long-term sentiment for the crypto stays intact even as prices retrace.

Why Billionaire Paul Tudor Jones Now Believes Bitcoin Has Become Less Attractive

Billionaire hedge fund manager Paul Tudor-Jones — who previously touted bitcoin’s allure as an inflationary hedge — now thinks the benchmark cryptocurrency is less attractive, suggesting it has lost some of its luster.

Jones cited the challenging regulatory environment in the U.S. and the inflation slowdown as fundamental headwinds for Bitcoin.

Regardless, the billionaire American investor — whose company controls approximately $40 billion in assets under management — said he still has a minor allocation in Bitcoin even though it has lost its appeal.

“Bitcoin Has A Real Problem”

One of the all-time great investors, Paul Tudor-Jones, told CNBC’s Squawk Box today that Bitcoin has a grave problem amid regulatory challenges in the United States.

“Bitcoin has a real problem because, in the United States, you have the entire regulatory apparatus against it,” Jones said during the interview.

In recent months, the United States Securities and Exchange Commission (SEC) has indeed stepped up its enforcement actions against crypto startups and platforms in the country, alleging wide breaches of securities laws. The multi-billion dollar implosion of crypto exchange FTX initiated a particularly intense wave of crypto regulatory clampdowns, including those on well-known exchanges, including Coinbase and Kraken. Coinbase has even threatened to move away from the U.S. if legal and regulatory certainty does not come forth.

Jones further said he thinks inflation will continue to cool off, adding to the less-bullish picture for Bitcoin.

Bitcoin is far and away the most famous cryptocurrency. Crypto propounders consider Bitcoin a store of value asset like gold, owing to the programmed code that reduces its pace of supply expansion by 50% quadrennially. Back in 2020, when central banks started money-printing sprees in a bid to keep the economy and financial system afloat in the wake of COVID-19 lockdowns, Jones wrote a compelling investor letter, generally viewed as a logical case for hedging one’s portfolio against inflation with the OG crypto.

Tudor-Jones Still Has Bitcoin Exposure

While Jones’s recent remarks weren’t exactly an endorsement of Bitcoin, given his major bullishness roughly three years ago, the hedge fund manager is not ready to completely cut ties with the number one cryptocurrency.

For Jones, Bitcoin remains intriguing, with its appeal mainly coming from the fact that a single individual or company cannot manipulate its supply.

“It is the only thing that humans can’t adjust the supply in, so I am sticking with it, and I am always going to stick with it,” the billionaire emphasized, adding that bitcoin accounts for a “small diversification” in his portfolio.

U.S. DOJ Vows To Beef Up Scrutiny Of Crypto Exchanges To Curb Illicit Behavior

The U.S. Justice Department is planning to increase its scrutiny of crypto trading platforms to target illicit behaviour.

According to Eun Young Choi, director of the National Cryptocurrency Enforcement Team (NCET), the DOJ is targeting cryptocurrency exchanges that engage in crimes themselves or allow “other criminal actors to easily profit from their crimes and cash out.”

DOJ On The Hunt For Crypto Bad Actors

In a Financial Times report on Monday, National Cryptocurrency Enforcement Team director Eun Young Choi noted that crypto crime has grown “significantly” in the last four years. As such, the department will be going after crypto exchanges that skirt anti-money laundering or know-your-customer laws or who do not invest in comprehensive compliance and risk mitigation processes.

“And so we hope that by focusing on those types of platforms, we’re going to have a multiplier effect,” Choi remarked.

The DOJ also aims to focus on crimes in the decentralized finance (DeFi) space, specifically relating to chain bridges, where users are vulnerable to hacks and thefts. Notably, cross-chain bridges have been a prime target for hackers in recent years, with billions worth of cryptocurrencies lost in a slew of exploits and attacks. Choi, who was announced as the first director of the NCET in February 2022, acknowledged that this was a critical issue for the DOJ, given North Korean state-sponsored hackers have emerged as “key actors” in the crypto sector.

Crypto Companies Are Fleeing The U.S. Amid Regulatory Tensions

The United States has notably taken a short-sighted and enforcement-heavy approach that is extinguishing innovation and entrepreneurship in the crypto space.

The DOJ crypto enforcement unit under the Biden Administration has become one of the government bodies with the most stringent stance on crypto globally. The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have also ramped up their scrutiny on cryptocurrency exchanges following the collapse of Sam Bankman-Fried’s FTX empire last November.

The predictable consequence of the brutal crackdown on the nascent sector is that more crypto companies are leaving the U.S. in search of friendlier jurisdictions. For instance, Binance.US canceled its $1B asset buy deal with Voyager, while Coinbase opened a crypto derivatives exchange in Bermuda as a prescient measure in response to the regulatory uncertainty in the U.S.

American policymakers should just allow crypto innovation to flourish by providing a realistic registration rulebook for centralized exchanges to operate within the country and letting permissionless competition deliver the perks of decentralized exchanges. Regulators should not be wary of U.S. markets’ innovative potential. They should instead fear killing it with impossible rules.

Terra’s Do Kwon To Walk Out Of Montenegro Jail After Securing $436,000 Bail

Montenegrin officials have granted Terraform Labs co-founder Do Kwon bail in the travel document forgery case. Kwon will be freed from jail on a supervised  €400,000 ($436,000) bail pending trial.

Do Kwon Out On $460,000 Bail

The man who stands accused of masterminding the implosion of the Terra ecosystem in May 2022 is set to be released from custody in Montenegro.

According to the May 12 announcement, the Basic Court in Podgorica accepted a request made by Do Kwon’s attorneys on Thursday to cough out 400,000 euros ($436,000) to have him put under house arrest instead of being in jail.

The court also agreed to release Terraform’s former chief financial officer Chang-joon Han on a similar €400,000 bond. Under the bail conditions, Kwon and Han will remain under surveillance and are barred from leaving their apartments. If the house arrest is breached, the bail will be put in a “special section” of the court’s working budget, the announcement said.

The two were apprehended by Montenegro police at the Podgorica airport in March while trying to board a plane to Dubai. They reportedly possessed fake passports from Belgium and Costa Rica. They also had at least one genuine passport given by South Korea, their native homeland.

The prosecution initially fought the bail request, indicating that Kwon and Han have adequate financial means but no interest in staying in Montenegro. Local prosecutors now have three days to appeal the decision if they are unsatisfied with it.

Kwon’s Mounting Legal Troubles

The court decision today comes after Kwon and Han pleaded not guilty to charges of travelling with falsified documents and presented their defence at a Thursday court hearing.

After legal proceedings regarding the forgery case in Montenegro are concluded, Kwon faces extradition to the U.S. or South Korea. The disgraced founder faces criminal charges in both countries for his role in the fall of the Luna token and TerraUSD (UST) stablecoin, an event that sent ripples throughout the crypto industry and set off a series of high-profile bankruptcies.

As ZyCrypto reported, South Korean authorities recently seized Kwon’s personal assets worth $176 million, including a series of imported vehicles, bank deposits, cryptocurrencies held at a digital currency exchange, officetel, and an apartment complex in Seoul.

Coinbase Faces Boycott Backlash After Calling PEPE Coin A ‘Hate Symbol’

Coinbase is facing withering backlash and a boycott from some members of the crypto community who are turned off by the exchange’s Pepe-hating rhetoric.

In an email newsletter sent to Coinbase users on Wednesday, the crypto exchange called Pepe a “hate symbol” while highlighting an association of the Pepe the Frog meme to political groups.

“The token is based on the Pepe the Frog meme, which first surfaced on the internet nearly 20 years ago as a comic-strip character,” the email read. “Over time it has been co-opted as a hate symbol by alt-right groups, according to the Anti-Defamation League.”

Pepe Community Seethes With Anger 

While the email has a disclaimer that dissociates the writer and does “not necessarily reflect the views of Coinbase or its employees”, a legion of fans and investors of the frog-themed meme coin were outraged at Coinbase’s portrayal of their beloved token.

Solidity developer and PEPE supporter Kenobi, for instance, astutely stated that the token is not a symbol of hate and that he would be transferring his crypto funds to Gemini digital asset exchange.

The hashtag “#deletecoinbase” began trending on Twitter Thursday as users seemingly deleted their accounts with the leading U.S. exchange.  

Former congressional candidate David Gokhshtein predicts that Coinbase will lose a boatload of customers for “disrespecting PEPE”.

Coinbase Avoids Listing PEPE

After the market’s largest exchange Binance, listed Pepe on the platform’s innovation zone on May 5, the token’s fans have been calling for other crypto exchanges to list the newly-launched meme coin as well.

Winklevoss twins-owned exchange Gemini succumbed to the pressure as it announced the listing of PEPE on May 9. Coinbase, on the other hand, has not indicated any plans to list the token on its exchange for trading.

Pepecoin has been on a roll since its launch last month, with its market cap peaking at $1.82 billion on May 6. Besides its stratospheric price increase, the flurry of speculation also sent Ethereum gas fees skyrocketing to 12-month highs.

However, the Pepe rally has run out of steam in recent days, with the token falling from a peak of $0.00000431 to $0.00000164 at press time, per CoinGecko. The downward price action has seen the meme coin’s total market cap sinking to $691 million.

Do Kwon’s Woes Escalate As South Korea Freezes $176M Of His Assets

It appears things are only getting worse for disgraced Terra founder Do Kwon. A Wednesday report revealed that South Korean prosecutors had managed to freeze around 233.3 billion Korean won, valued at about $176 million, in Kwon’s personal assets as criminal proceedings against the former Terraform Labs CEO continue.

Kwon’s Funds Frozen

Do Kwon has had his assets frozen by South Korean authorities.

According to a May 10 report from local publication Hankyung, Chief Judge Yoon Chan-young of the 12th Criminal Division of the Seoul Southern District Court approved the prosecutors’ request to lock Kwon’s property. The assets in question include the Galleria Foret apartment complex in Seongdong-gu, Seoul, a new officetel in Nonhyeon-dong, and multiple imported cars.

The judge also prohibited the sale of Kwon’s financial assets, such as securities deposited in Mirae Asset Securities, deposits in Woori Bank, and crypto assets stored in personal wallets on exchanges.

South Korean law mandates that suspects are banned from the disposition of assets or proceeds obtained illegally until a conviction is made.

Last week, the director of Seoul Southern District’s joint financial crimes told The Wall Street Journal that Kwon is facing up to 40 years behind bars if convicted — the longest sentence handed to a financial crime in the history of  South Korea.

From Crypto ‘Genius’ To Alleged Crypto Scammer

The spectacular collapse of Terra’s Luna and the UST algorithmic stablecoin back in May 2022 was a key catalyst for the crypto industry’s slip into its crypto winter, with the prices of bitcoin and other cryptocurrencies falling hard and several high-profile players like Three Arrows Capital becoming insolvent.

Kwon was infamously compared to the infamous Elizabeth Holmes, who promised Theranos investors far more than she could deliver.

In mid-February this year, roughly 9 months after the Terra ecosystem careened to zero, the U.S. Securities and Exchange Commission (SEC) lodged civil charges for securities fraud against Kwon and his now-defunct Singapore-based firm Terraform Labs.  

The SEC claims, for a start, that Terraform Labs worked with U.S.-based trading firms to keep the illusion that UST’s self-balancing algorithm truly worked to keep its price pegged to one dollar. Both through these relationships and through more direct techniques, the SEC states that the beleaguered crypto founder and Terraform frequently intervened in the market for Luna and TerraUSD.

Then, in March, came the news that everyone in the cryptosphere was really hoping for. Authorities of the small Balkan nation of Montenegro disclosed that their police… had apprehended Do Kwon.

The detention was swiftly confirmed by both South Korean law enforcement and by Interpol. And within hours, U.S. prosecutors slapped the South Korean national with eight counts of fraud, adding to the civil charges filed previously by the SEC.

Both South Korea and the U.S. are currently vying for the extradition of the crypto entrepreneur once hailed as a genius. 

Coinbase v SEC: Chamber Of Digital Commerce Weighs In, Argues Regulator Is Causing Substantial Economic Harm

The world’s largest blockchain advocacy and trade group, the Chamber of Digital Commerce (CDC), has announced backing Coinbase in its legal and public relations battle with the U.S. Securities and Exchange Commission (SEC).

The Chamber of Commerce filed an amicus brief on Tuesday, claiming that the U.S. regulator’s antagonistic stance against crypto is causing significant economic harm.

Crypto Trade Group Files Amicus Brief In Coinbase v. SEC

CDC, a non-profit trade association that engages government officials on the use of crypto and blockchain, has filed an amicus brief in the ongoing court case between America’s leading exchange Coinbase and the SEC.

In the amicus brief — a legal document supplied to a court of law that allows a non-litigant to submit their expertise or opinion in a case as “a friend” of the court — the Chamber of Digital Commerce argued that by failing to respond to Coinbase’s July 2022 petition for sufficient regulatory guidance, the SEC is “causing substantial economic harm to both Coinbase and the broader business community.”

Filed on May 9, CDC says it is supporting Coinbase as it seeks formal rulemaking within the digital assets sector. In particular, the exchange wants the SEC to answer when a token sale constitutes an investment contract — and therefore qualifies as a securities offering.

The amicus brief also notes that the CDC has a strong interest in ensuring there is enough clarity around regulations applying to digital assets:

“Chamber’s members have a strong interest in regulatory clarity, and many of its members are companies subject to US securities laws that may be adversely affected by the Securities and Exchange Commission’s current approach to digital assets.”

In recent months, the SEC has pursued a spate of enforcement actions against what it considered issuers of unregistered securities. Recently, those crypto cases have come at a furious pace, with the SEC even boosting the size of its digital assets enforcement team.

The securities watchdog in March sent Coinbase a Wells Notice regarding aspects of the company’s staking service Coinbase Earn and Coinbase Wallet after a cursory probe, tipping it off that the regulator is building a case against it.

Chamber Says Innovation And Regulation Can Co-Exist

The Chamber of Commerce further argued in the brief that the lack of regulatory certainty in the U.S. is stifling innovation.

“The digital-asset industry offers a case study in how regulatory uncertainty undermines innovation. Before the Commission began rattling its saber, the industry grew quickly — reaching a trillion dollars in market capitalization by early 2021,” the amicus brief noted.

The trader group also has serious concerns about the SEC not testing its legal allegations in court because it forces most companies to settle its enforcement actions. The agency leaves crypto firms to “accept the risk of future litigation — and the associated financial burdens — or they can stop engaging in conduct that the agency might or might not ultimately target.”

The Third Circuit Court of Appeals recently ordered the SEC to respond to Coinbase’s complaint within ten days.

Meanwhile, Coinbase rolled out its international platform earlier this month via regulatory approval from the Bermuda Monetary Authority (BMA). Coinbase International Exchange will first list Bitcoin and Ethereum perpetual futures.

Garlinghouse Slams Claim Ripple Could Have Avoided Costly Tussle With SEC By Registering XRP As A Security

It was recently reported that Ripple Labs would spend roughly $200 million defending the SEC lawsuit. However, top venture capitalist Jason Calacanis has claimed that the San Francisco-based blockchain payments firm would have spent less if it only registered XRP as a security.

Ripple CEO Brad Garlinghouse did not hesitate to criticize Calacanis, alluding to his lack of securities laws knowledge.

“XRP Is Obviously A Security”

It all started when well-known tech investor and podcaster Jason Calacanis commented on Brad Garlinghouse’s recent interview, revealing that Ripple’s courtroom battle with the U.S. Securities and Exchange Commission is set to cost his company a lot staggering $200 million.

In Jason’s view, XRP is “obviously a security”, adding that it would have cost Ripple way less if it went to the SEC and registered the token as a security. He added that the company should have just “played by the rules” like other participants in the crypto industry.

The SEC — which is currently going after crypto like never before — accused Ripple of violating federal securities laws. The specific complaint revolves around the firm’s sale of the XRP cryptocurrency without obtaining prior registration with the watchdog agency. 

In response, the Ripple chief questioned Jason’s understanding of securities laws and noted that he was known for making controversial statements and taking aim at topics without proper knowledge. Garlinghouse also indicated that the VC’s assertion was both “embarrassing” and “hilariously wrong” given that U.S. authorities have not provided sector-specific rules for registering digital assets.

More Support For XRP

The heated exchange between Ripple and Jason spotlights the ongoing debate surrounding the security status of XRP and the lack of a clear rulebook for cryptocurrencies in the United States.

Attorney John E. Deaton, who is representing XRP holders as amicus curiae, also contributed to the argument initiated by Jason. Deaton said the claim that Ripple sold XRP as a security is one thing, while the claim that XRP, which is basically a line of code inside the software, is a security is another thing.

The legal expert also asked where other cryptocurrencies such as Ethereum (ETH), Cardano (ADA), Algorand (ALGO), and Stellar (XLM) have registered for they not to be facing the same attack from the SEC.

The three-year battle between the SEC and Ripple — possibly coming to an end soon — is expected to set a precedent for the treatment of cryptocurrencies, particularly altcoins, under U.S. securities and commodities laws.

Ex-Coinbase Product Manager Gets Two-Year Prison Term For Insider Trading

Ishan Wahi, the former product manager at Coinbase Global accused of insider trading, was on Tuesday sentenced to 24 months in prison.

As ZyCrypto previously reported, Wahi pleaded guilty in February to fraud charges for his role in using insider information he obtained during his time working at Coinbase to profit off upcoming token listings.

The sentence imposed by U.S. District Judge Loretta Preska in Manhattan was one year shorter than what prosecutors had asked for.

Profiting From Insider Trading

Ex-Coinbase manager Ishan Wahi will spend time behind bars at a Federal prison after pleading guilty to insider trading allegations.

Wahi and his co-conspirators — including his brother, Nikhil Wahi — allegedly used information he acquired from America’s biggest crypto exchange to profit off new crypto listings. The alleged scheme revolving around trading on Wahi’s confidential information netted the three men as much as $1.5 million.

Judge Loretta Preska ordered Wahi to surrender by June 21 at 2:00 PM ET to serve his term at the Fort Dix Federal Correctional Institution in New Jersey. After his time in jail, he will be subject to two years of supervised release for each count, running concurrently.

Wahi tried to flee the country after being questioned by Coinbase, the Department of Justice revealed. But he was arrested by U.S. authorities in July 2022 while attempting to board a flight to India.

After first pleading not guilty and trying to dismiss the charges against him, the Indian National pleaded guilty in February to two counts of conspiracy to commit wire fraud.

Wahi, his brother, and his friend Sameer Ramani were also slapped with civil charges by the U.S. Securities and Exchange Commission (SEC). Ramani remains at large at press time, while Nikhil was sentenced to 10 months in prison.

Second Insider Trading Case Involving Crypto

Notably, U.S. prosecutors had recommended a three-year term for Wahi to dissuade other crypto insiders from misusing confidential information.

“You spoke very nicely, you said all the right things,” Preska said, while sentencing Wahi to two years in prison. “I hope that you can make this up to your parents.”

Wahi’s imprisonment marks the second criminal insider trading case involving digital assets that the Department of Justice has pursued.

The sentencing came less than a week after the ex-head of product at non-fungible token marketplace OpenSea, Nathaniel Chastain, was convicted of fraud and money laundering for using inside knowledge of which assets would be featured on the platform’s homepage to accrue illegal profits. According to the DOJ, this was the first-ever insider trading scheme involving crypto.

Chastain will be sentenced at a later date, but he faces a maximum of 40 years in prison.

Sam Bankman-Fried Blames ‘Crypto Winter’ For FTX Collapse In Attempt To Dodge Most Fraud Charges

Sam Bankman-Fried, the founder and former CEO of the failed FTX crypto exchange, has filed pre-trial motions to dismiss most of the charges levelled against him by United States prosecutors.

Bankman-Fried’s attorneys are arguing that the implosion of FTX in November resulted from the so-called “crypto winter” and not any cruel intention. Their argument also lays blame on the U.S. government over its hostile regulatory environment around crypto assets in recent years.

“A Classic Rush To Judgement”

Sam Bankman-Fried, who is set to face criminal trial in October, has moved to dismiss all but three allegations against him.

In May 8 filings in the Southern District Court in New York, SBF’s lawyers sought to dismiss everything apart from charges alleging conspiracy to commit commodities fraud, conspiracy to commit securities fraud, and conspiracy to commit money laundering.

The disgraced FTX founder, who is currently on house arrest in his parent’s home in Palo Alto, faces a total of 13 different charges ranging from wire fraud to bribery claims. His lawyers are, however, seeking the dismissal of 10 of these charges. The pretrial motions contend that four of the charges added from February, including foreign bribery, campaign finance, and bank fraud, violate “Treaty’s rule of specialty provision.” According to the “rule of specialty”, the U.S. should only trial Bankman-Fried for the offenses for which he was extradited from the Bahamas.

The early defense effort also asserts that the remaining six charges should be dismissed because the federal prosecutors failed to state an adequate offense in these counts.

Furthermore, SBF’s defence argues that the U.S. prosecutors’ pursuit of the fallen crypto star is a “classic rush to judgment.”

Blame Crypto Winter, Not FTX: SBF’s Defense Team

The legal team also contends that the bankruptcy of Bahamas-based FTX — once the third-biggest cryptocurrency exchange in terms of trading volume with a valuation of around $32 billion — was the result of a broader “crypto winter” last year, which saw the price of Bitcoin and other cryptocurrencies dive, rather than failure to back FTX’s native token FTT, or secret loans from FTX to affiliated trading firm Alameda Research as alleged by prosecutors.

The defense claimed that “every major participant” in the crypto sector “cratered,” and compared the fall of various crypto companies to the infamous 2008 global financial crisis, which spurred the popularity of bitcoin and the blossoming of cryptocurrencies.

“Like many other cryptocurrency market participants and many other start-ups that experience exponential growth in a short period, FTX did not have fully developed controls and risk management protocols,” SBF’s defense posited. “FTX, like other market participants, was susceptible to a broader market collapse.”

Bankman-Fried’s estimated fortune of $26 billion, largely accrued during the crypto bull market, was seriously eroded after his crypto empire crumbled last year. Still, prosecutors have accused the former crypto mogul of splurging billions of customer funds on luxury property in the Bahamas, funding sports teams, and political donations in the United States.

Garlinghouse Reveals Ripple Will Spend $200M Defending Itself Against The SEC Even As Case Worries XRP Holders

Brad Garlinghouse, the CEO of blockchain payments firm Ripple, has revealed the cost implications of its legal tussle with the U.S. Securities and Exchange Commission (SEC).

$200 Million In Legal Fees 

According to Brad Garlinghouse, the cost of Ripple Lab’s lawsuit with the SEC will be well above the nine-figure mark. 

Speaking to onlookers at the Dubai Fintech Summit on Monday, Garlinghouse said his company will have spent an eye-popping $200 million in legal fees by the time the case is concluded.

The SEC initiated the lawsuit in December 2020, alleging that Ripple and two of its co-founders misled investors by raising over $1.3 billion in unlicensed securities since 2013; Ripple refutes that its XRP cryptocurrency is a security. The company launched a regional base in Dubai in the same year as it considered leaving the U.S.

Garlinghouse stated during the Summit that he would discourage cryptocurrency entrepreneurs from setting up shop in the U.S. as the nation has put politics ahead of policy. “If I were you, I would not start in the United States,” the Ripple boss posited, adding that several American-headquartered and publicly-traded companies would agree.

Garlinghouse went on to note that the United States’ regulatory progress is lagging significantly behind the United Arab Emirates virtual asset regulatory authority and the recent Markets in Crypto-Assets (MICA) bill in the European Union.

Crypto observers have accused U.S. regulators of using a regulation-by-enforcement strategy whereby watchdogs such as the SEC and the Commodity Futures Trading Commission (CFTC) choose to serve up suits and legal threats rather than formulate new laws for the still-nascent industry.

The SEC, in particular, has clamped down on some of the most high-profile crypto players over alleged breaches of securities regulations in recent months since the implosion of the FTX exchange. Ripple CEO, however, argued that the majority of people working in the crypto sector are good actors who want to follow the set rules but need them to be clearly defined.

The SEC vs Ripple suit has dragged on over the years, but it is expected in the next three to six weeks, there will be a judgment. 

Implications Of The Protracted XRP Lawsuit 

The XRP lawsuit is one closely followed by many members of the cryptoverse as they wait to see on whose side the pendulum will swing.

The ruling on the lawsuit has far-reaching repercussions on the evolving crypto industry. And as such, a victory for Ripple is a victory for the entire crypto industry.

Should District Judge Analisa Torres rule in Ripple’s favour, the regulators will be compelled to provide more straightforward laws for the ecosystem.

Yet, a loss for Ripple would give the SEC the necessary ammunition to continue cracking down on crypto players. Such companies and individuals will be forced to settle rather than pursue a legal fight with the regulatory agency.

How This Early PEPE Buyer Turned $260 Into Almost $8 Million Amid Meme Coin Frenzy

Is meme coin season really back?

Pepe (PEPE), the token which sprouted out of the “Pepe the Frog” meme and went live a little over two weeks ago, has already minted many millionaires overnight.

One early PEPE buyer swapped 0.125 ETH worth $260 for 5.9 trillion PEPE tokens last month. Those tokens are currently worth nearly $8 million, according to blockchain analytics firm Arkham.

PEPE Millionaire

Meme coins have enjoyed somewhat of a renaissance in recent weeks. PEPE has seen particularly high interest as investors flock to the frog-themed token, hoping to repeat the success of rival dog-themed meme coins Dogecoin (DOGE) and Shiba Inu (INU).

The newly-launched PEPE received a massive boost yesterday after the world’s largest crypto exchange, Binance, listed the token in the platform’s so-called innovation zone. PEPE soared another 124% over the past day, pushing the frog-inspired token’s market cap above the $1 billion mark. One PEPE is currently worth $0.000003 per CoinGecko. With an impressive market value of over $1 billion, PEPE is now the 40th largest cryptocurrency.

Arkham recalls that buyer dimethyltryptamine.eth, who remains anonymous, scooped up $260 worth of PEPE last month, and his stockpile has now ballooned to almost $8 million. However, this PEPE holder could encounter problems trying to realize that profit due to liquidity concerns around the meme coin.

What is PEPE?

Pepe creators branded it “the most memeable memecoin in existence.” The token has a circulating supply of 420 trillion, a reference to “4/20,” a popular cannabis culture slang.

Traders have a knack for jumping on the meme coin craze, mainly after the meteoric rise of tokens such as dogecoin and Shiba inu — which rocketed to tens of billions in market capitalization during the previous bull market.

Pepe appears to have taken the crown as traders’ favourite meme coin. Earlier this week, trading volume for PEPE surpassed that for both DOGE and SHIB.

While PEPE’s huge rally has turned some early investors into millionaires — on paper, at least — dimethyltryptamine.eth has yet to sell his tokens, underscoring a popular trend of long-term holding strategies among crypto investors.

Ripple And Coinbase’s Top Legal Minds Hold Offsite Meeting — Is An XRP Relisting Closer Than Ever?

U.S. regulators, not least of all the Securities and Exchange Commission, have taken an aggressive tack lately with the crypto industry. Amid the regulatory headwinds, Coinbase’s and Ripple’s top legal experts met to discuss pressing matters in the fast-growing crypto space.

The news of the meeting has prompted speculation about the U.S.’s largest and best-known exchange relisting Ripple’s cryptocurrency XRP.

Ripple And Coinbase Legal Officers Hang Out

The top lawyers from Ripple and Coinbase convened for a recent offsite meeting to discuss pressing concerns in the vibrant crypto landscape.

Coinbase’s chief legal officer, Paul Grewal, took to Twitter earlier today to express his appreciation to Ripple’s Stuart Alderoty for being invited to the meeting and suggested more meetings in the future. Alderoty then tweeted his gratitude to Grewal for taking the time to connect with the Ripple legal team.

Details of the meeting were sparse, but both Ripple and Coinbase are currently at an impasse with the U.S. SEC. Ripple Labs was sued back in December 2020 for allegedly selling unregistered securities in the form of XRP.

On the other hand, Coinbase — which has become the second-largest crypto exchange, trailing only Binance — was slapped with a Wells Notice by the SEC in March over potential violations of U.S. securities law. In a document last week, the San Francisco-headquartered platform pushed back against the SEC’s enforcement notice.

These two U.S.-based companies have often called for formal rulemaking within the crypto assets sector, which the watchdog agency has ignored and chosen regulation by enforcement instead. In recent months, the SEC has taken action against notable industry players, including digital asset exchanges Bittrex, Kraken, Gemini, crypto lender Genesis and individual actors such as Tron founder Justin Sun. 

But Will Coinbase Relist XRP?

Coinbase has previously requested the court for permission to file a friend of the court (“amicus”) brief in Ripple’s case with the SEC, arguing that the lawsuit threatens the broader industry. Grewal has also, in recent weeks, hailed the legal defense mounted by Ripple. 

Many XRP fans are once again suspecting that Coinbase could soon relist XRP on its platform following the offsite meeting, where the two chief legal officers are seen pictured in a close friendly pose.

Even if Grewal and Stuart’s body language indicates improving cordiality between Coinbase and Ripple, a relisting of XRP soon seems unlikely at this point. As ZyCrypto reported, Grewal pointed out in a recent interview with Tony Edward that a possible timeline for relisting depends on various factors.

At press time, XRP was changing hands at $$0.456461, a gain of 0.9% in the past day, according to CoinGecko.

XRP Lawsuit: Legal Expert Suggests Ripple May Consider Settlement Even If It Scores Major Win Against SEC

As the crypto world eagerly awaits District Judge Analisa Torres’s ruling in the landmark case between the U.S. Securities and Exchange Commission (SEC) and Ripple Labs, pro-XRP attorney John E. Deaton is hinting that the San Francisco-based enterprise blockchain company could agree to new settlement terms. Deaton, however, emphasized that this will depend on the ruling in the lawsuit.

Expert’s Opinion Regarding A Likely Ripple-SEC Settlement

John Deaton has taken to Twitter to highlight various scenarios that could influence Ripple’s decision on whether or not to settle.

Deaton’s comments come amid chatter among the community of a secret meeting between Ripple and the SEC. In his opinion, the terms of a potential settlement would depend on the specifics of the outcome of the ongoing litigation.

One important consideration would be whether leading U.S.-based digital assets exchanges like Coinbase and Kraken would immediately restart XRP trading on their platforms or wait for a possible appeal by the SEC. Coinbase delisted XRP in January 2021, immediately after the SEC launched its lawsuit against Ripple. Despite vocal appeals by the XRPArmy, Coinbase has remained unmoved.

Another key consideration would be whether major Ripple partner, Bank of America, would feel comfortable about the court verdict or wait to see if Judge Torres gets overturned in the event the SEC appeals her decision.

Deaton notes that the SEC could possibly file a notice of appeal and later withdraw it, leaving room for more negotiations.

The XRP amicus curiae also pinpointed a theoretical scenario in which the U.S. securities regulator told Ripple it would issue a public statement that all future sales of XRP don’t constitute securities and not appeal Judge Torres’ ruling if the payments firm agrees to pay $50 million. Deaton says, in this case, Ripple boss Bradley Garlinghouse would swiftly sign off on the settlement as this would provide the certainty the company has long clamoured for and return liquidity to the U.S. market.

Still, if Judge Torres rules that Ripple did not violate federal securities laws and subsequently revives liquidity to U.S. markets without causing businesses to worry about being in the SEC’s crosshairs if they utilize the XRP cryptocurrency, then Ripple will ultimately decide to refrain from a settlement. 

After two gruelling years in the Southern District of New York, a ruling in the XRP lawsuit could further define what crypto assets are considered securities in the United States.