Ripple (XRP) Price Prediction 2025-2030: XRP soars as SEC case nears

https://ambcrypto.com/?p=302258

Disclaimer: The datasets shared in the following article have been compiled from a set of online resources and do not reflect AMBCrypto’s own research on the subject.

Ripple (XRP) is a cryptocurrency that is designed to facilitate fast and cheap cross-border money transfers. It is the native token of the Ripple network, a decentralized payment protocol that is designed to connect banks, payment providers, and digital asset exchanges. Ripple aims to improve the speed and efficiency of cross-border payments by using XRP as a bridge currency.


Read Price Prediction for Ripple (XRP) for 2023-24


One of the key advantages of XRP is its speed. Transactions on the Ripple network can settle in just a few seconds, compared to several minutes or even days for traditional wire transfers. This makes it an attractive option for businesses and individuals looking to send money across borders quickly and cheaply.

After the company was established, the XRPL architects gifted 80 billion XRP tokens to Ripple for the company to build on the network. The XRP Ledger uses a consensus system that involves several bank-owned servers to verify transactions. The validators verify that the proposed transactions are valid by comparing them to the most recent version of the XRP Ledger.

A transaction must be accepted by the majority of validators to be verified. According to data from CoinMarketCap, XRP was trading at $0.4445 at press time. The token’s market capitalization of $22,734,327,572 makes it the sixth largest cryptocurrency in the world. XRP had a 24-hour trading volume of $1.5 billion at the time of writing. Data from Coinglass shows that the total open interest on XRP futures grew by +7.99% over the past 24 hours until press time.

The XRP ledger uses distributed ledger technology, which is different from the more commonly used blockchain technology. This technology allows bank and non-bank actors to incorporate the Ripple protocol into their own systems, as the protocol is completely open and accessible to anyone without prior approval from Ripple Labs.

In 2017 and early 2018, XRP reached an all-time high of $3.40, marking a 51,709% increase from its original price at the beginning of that year. Although it has since declined, XRP remains a significant player in the cryptocurrency market and is consistently ranked among the top ten coins in terms of market capitalization. The team behind XRP and Ripple continue to work on the development of the XRP ledger and its potential use cases in the global financial system. Overall, XRP remains a significant and influential cryptocurrency in the world of finance and technology.

In 2020, the US Securities and Exchange Commission (SEC) sued Ripple, alleging that the company sold $1.3 billion in unregistered securities through its XRP cryptocurrency. Ripple denies the allegations, claiming that XRP is not a security and does not meet the criteria for the Howey Test.

A report by CoinShares indicated that investors are confident of Ripple’s victory in the landmark case against the SEC. This is based on the fact that XRP investment products have seen consistent inflows for three consecutive weeks.

On the business front, Ripple revealed key developments pertaining to its European expansion. The company shared its progress with Paris- based Lemonway and Xbaht in Sweden. Businesses in France and Sweden will now be able to leverage Ripple’s On-Demand Liquidity (ODL).

On 15 November, Ripple announced that it partnered with MFS Africa, a leading FinTech firm with the largest mobile money footprint in the continent. This joint venture seeks to streamline mobile payments for users in 35 countries.

In other news, Ripple CTO David Schwartz took to Twitter to offer former employees of the troubled crypto exchange FTX, a place at Ripple. However, this offer only stands for employees who were not involved with compliance, finance, or business ethics.

About the platform

Ripple’s tie-up with Tokyo Mitsubishi Bank in 2017 was a major milestone. Following the same, it became the second-largest crypto by market capitalization for a brief period. A year later, Ripple was in the news again for its partnership with international banking conglomerate Santander Group for an app focusing on cross-border transactions.

In terms of rivals, Ripple has close to none at the moment. They are the leading crypto firm catering to financial institutions around the world. As the number of partnerships grows, XRP will reap the benefits. After all, it is the medium of exchange for all cross-border transactions enabled by RippleNet.

Ripple has been capitalizing on the need for quick transactions and another untapped potential in emerging economies, given that nations in Latin America and Asia-Pacific regions are more likely to realize the value of blockchain and its tokens compared to their first-world counterparts. With the rise of central bank digital currencies (CBDC), it is likely that developing countries looking to explore this option will go for Ripple, since it already offers a well-established cross-border framework. Increased adoption of CBDCs will also lead to banking institutions considering integrating crypto into their services. This will work out very well for Ripple, since RippleNet is already associated with a number of banks.

Blockchain solutions being offered to Ripple’s Central Bank partners wanting to venture into CBDCs include the option to leverage the XRP ledger using a private sidechain.

Ripple is predicted to develop rapidly over the forecast period, as it can be used for a variety of functions like accounting, investment, smart contract implementation, and decentralized programming.

XRP has an edge over its rivals due to its low cost of entry. The fact that a few dollars will buy tens of XRP seems appealing to new investors, especially those who prefer little investment.

According to a Valuates report, the cryptocurrency market’s size is expected to hit $4.94 billion by 2030, growing at a CAGR of 12.8%. A number of crypto-firms will benefit from this, Ripple among them.

The growth in the cryptocurrency market is spurred by an increase in the demand for operational efficiency and transparency in financial payment systems, as well as an increase in demand for remittances in developing nations.

The general idea is that RippleNet’s adoption by financial institutions will increase, leading to more recognition of the platform as well as its native token. This has also been factored in while calculating predictions for 2025 and beyond.

According to data from CoinMarketCap, XRP is currently trading at $0.5180, up 2.06% in the past 24 hours. The token’s market capitalization stood at $26,608,919,144 at press time, making it the sixth largest crypto in the world. 

Source: XRP/USD on TradingView

XRP’s press time price was a far cry from its all-time high of $3.84 in January 2018. As a matter of fact, its price was closer to its launch price than its all-time high.

Although XRP gained somewhat over the last three months, its recent returns have made investors worried.

SEC lawsuit and its impact

On 22 December 2020, the U.S Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs. The lawsuit alleged that Ripple had raised $1.3 billion through the sale of ‘unregistered securities’ (XRP). In addition to this, the SEC also brought charges against Ripple’s top executives, Christian Larsen (Co-founder) and Brad Garlinghouse (CEO), citing that they had made personal gains totaling $600 million in the process.

The SEC argued that XRP should be considered security rather than a cryptocurrency and as such, should be under their purview.

A verdict in favor of the SEC will set a rather unpleasant legal precedent for the broader crypto market. This is why this case is being closely observed by stakeholders in the industry.

It is evident that developments in the lawsuit have a direct impact on XRP’s price. Following the news of the lawsuit in 2020, XRP tanked by almost 25%. In April 2021, the judge handed Ripple a small victory by granting them access to SEC’s internal documents, which caused XRP to rise over the $1-mark – A threshold that the crypto hadn’t crossed in 3 years.

According to a tweet by Defense Attorney James Filan on 15 August 2022, the U.S District Court for the Southern District of New York dealt yet another blow to the SEC when Judge Sarah Netburn granted Ripple’s motion to serve subpoenas to obtain a set of video recordings for the purpose of authentication, dismissing the regulators claim that Ripple was trying to reopen discovery. This was in response to Ripple’s motion filed on 3 August 2022.

In the Opinion & Order published earlier in July, Judge Sarah Netburn condemned the SEC for its “hypocrisy” and actions which suggested that the regulator was “adopting its litigation positions to further its desired goal, and not out of a faithful allegiance to the law.”

The lawsuit’s verdict, whatever it is, will have a lasting impact on XRP’s value. It is important to note that a verdict in favor of the SEC would make XRP security only in the U.S. because the regulator does not have jurisdiction across the country’s borders. This should offset some of the damage to Ripple, given that it has a substantial amount of business globally.

Carol Alexander, Professor of Finance at the University of Sussex, believes that XRP is unlike any other crypto. She believes that if Ripple manages to beat the SEC lawsuit, it could start taking on the SWIFT banking system. SWIFT is a messaging network that financial institutions use to securely transmit information and instructions.

In an interview with CNBC, Ripple CEO Brad Garlinghouse talked about the possibility of an IPO after the case with the SEC is resolved. Ripple going public will have a significant impact on XRP’s price action in the following years.

In an interview with Axios at Collision 2022, Garlinghouse further stated that the current price of XRP has already factored in Ripple losing the case. “If Ripple loses the case, does anything change? It’s basically just status quo,” he added.

As for his personal opinion on the verdict, Garlinghouse is betting that it will be in favor of Ripple. “I’m betting that because I think the facts are on our side. I’m betting that because the law is on our side,” he remarked.

Curiously, support for Ripple and XRP hasn’t been universal really, with Ethereum’s Vitalik Buterin recently commenting,

“XRP already lost their right to protection when they tried to throw us under the bus as “China-controlled” imo”

In court and in papers

Ripple and the SEC’s lawsuit is not just restricted to the courtroom. The matter is often covered by the media with both parties having been featured in multiple op-eds, often criticizing each other. Just this month, the market watchdog and the crypto firm were the subject of a heated exchange through pieces published by the Wall Street Journal.

On August 10, SEC Chairman Gary Gensler reiterated his stance on the definition of crypto assets and their oversight in his op-ed piece featured in The Wall Street Journal. “Make no mistake: If a lending platform is offering securities, it . . . falls into SEC jurisdiction.”

Chairman Gensler went on to cite the $100 million settlement that the regulator had reached with BlockFi, stating that the crypto markets must comply with “time-tested” securities laws. As per the terms of the settlement, BlockFi has to rearrange its business to comply with the U.S Investment Company Act of 1940 in addition to registering under the Securities Act of 1933 to sell its products.

In response to Chairman Gensler’s op-ed, Stu Alderoty published his own piece in The Wall Street Journal and did not mince his words while taking a shot at the regulator. Alderoty accused Gensler of side-lining fellow regulators (CFTC, FDIC etc.) and overreaching its jurisdiction, as opposed to the executive order by U.S President Joe Biden, which directed agencies to coordinate on regulations for crypto.

“What we need is regulatory clarity for crypto, not the SEC swinging its billy club to protect its turf at the expense of the more than 40 million Americans in the crypto economy,” Alderoty added.

A controversial article authored by Roslyn Layton in Forbes on 28 August pointed out that since 2017, the SEC’s Crypto Assets Unit has been involved in 200-odd lawsuits. According to Layton, this figure suggests that instead of coming up with clear regulations to ensure compliance, the regulator would rather engage crypto firms with lawsuits in an attempt to regulate by enforcement.

Ripple CTO David Schwartz found himself in a stand-off with Ethereum Co-Founder Vitalik Buterin earlier this month, after Buterin took a dig at XRP on twitter. Schwartz hit back and responded to Buterin’s tweet, comparing miners in the PoW ecosystems like Ethereum to stockholders of companies like eBay.

“I do think it’s perfectly fair to analogise miners in PoW systems to stockholders in companies. Just as eBay’s stockholders earn from the residual friction between buyers and sellers that eBay does not remove, so do miners in ETH and BTC,” Schwartz added.

Now, putting an accurate figure on the future price of XRP is not an easy job. However, as long as there are cryptocurrencies, there will be crypto pundits offering their two cents on market movements.

Ripple [XRP] Price Prediction 2025

Changelly has gathered an average prediction of $0.47 for XRP by the end of 2022. As for 2025, Changelly has provided a range between $1.47 to $1.76 at max for XRP.

Finder’s conclusion from a panel of thirty-six industry experts, is that XRP should be at $3.61 by 2025. It should be noted that not all of those experts agree on that forecast. Some of them believe that the crypto won’t even cross the $1 threshold by 2025. Keegan Francis, the global cryptocurrency editor for Finder, does not agree with the panel of experts. He predicts that XRP will be worth $0.50 by the end of 2025 and, surprisingly, a mere $0.10 in 2030.

According to data published on Nasdaq, the average projection for 2025 is around $3.66.


Are your XRP holdings flashing green? Check the profit calculator


Ripple [XRP] Price Prediction 2030

Finder’s experts had a rather conservative figure for XRP in 2030. They believe that the crypto could hit $4.98 by 2030. In a statement to Finder, Matthew Harry, the Head of Funds at DigitalX Asset Management, revealed that he doesn’t see any utility in XRP other than the speculation element.

According to data published on Nasdaq’s website, the average projection for 2030 is around $18.39.

Conclusion

Year-to-date (YTD) figures from Ripple’s Quarter 2 earnings report have made it clear that despite the drop in XRP’s price, demand for their On-Demand Liquidity service not only remained undeterred but actually grew by nine times year-over-year (YoY) with ODL sales totalling $2.1 billion in Q2. The report further stated that Ripple has pledged $100 million for carbon removal activities, in line with their carbon neutral objective and sustainability goals.

Ripple’s Crypto Trends report claims that NFTs and CBDCs are still in their nascent stages and, as their potential is gradually realized, its impact on Ripple’s network and on the broader blockchain space will be visible.

It should be noted that while various experts have predicted XRP’s price to increase in the following years, there are some who believe that XRP will lose all value by the end of the decade.

The major factors that will influence XRP’s price in the coming years are:

  • Verdict of the SEC lawsuit
  • IPO after lawsuit is resolved
  • Partnerships with Financial Institutions
  • Mass Adoption
  • CBDC ventures by Central Banks

Predictions are not immune to changing circumstances, and they will always be updated on new developments.

With the Fear and Greed index leaning towards ‘greed’ at press time, it implies that investors were confident in their expectations about Ripple.

Source: CFGI.io

Altcoin, with XRP at the top of the list, is Bitcoin continuing to be a bull market | Contribution by bitbank analyst

https://ourbitcoinnews.com/altcoin-with-xrp-at-the-top-of-the-list-is-bitcoin-continuing-to-be-a-bull-market-contribution-by-bitbank-analyst/

Virtual currency market this week (3/25 (Sat) – 3/31 (Fri))

Mr. Hasegawa, an analyst at the major domestic exchange bitbank, illustrates this week’s bitcoin chart and analyzes the future outlook.


table of contents
  1. Bitcoin on-chain data
  2. Contributed by bitbank

Bitcoin on-chain data

Number of BTC transactions

Number of BTC transactions (monthly)

Number of active addresses

Number of active addresses (monthly)

BTC mining pool remittance destination

Exchange/Other Services

bitbank analyst analysis (contribution: Yuya Hasegawa)

Weekly report from 3/25 (Sat) to 3/31 (Fri):

The Bitcoin (BTC) exchange rate against the yen this week remained firm, continuing from last week to the high price range from beginning to end.

The U.S. Commodity Futures Trading Commission (CFTC) sued Binance, and the BTC market tried to break below the lower end of the high price range from the beginning of the week. The decline was limited.

Rather, the altcoin market will be strong this week, led by XRP, and BTC will also be supported by buying, following the statement by U.S. Securities and Exchange Commission (SEC) Chairman Benham that Ethereum’s Ether (ETH) is a commodity. In response, BTC started a rebound as the ETH market rose.

As the middle of the week approached, the XRP market strengthened further, and BTC also recovered to 3.6 million yen. In addition, following the news that SEC Chairman Gensler will be summoned to the House Financial Services Committee in April, the market price is 3.8 million yen due to speculation that the US Congress has doubts about the recent SEC crackdown. It was thin.

BTC on Thursday temporarily recovered to 3.8 million yen, but when a large profit-taking was observed and it was deceived, US stocks fell and some altcoins took profits, weighing the top price and falling. Currently, the dollar-denominated exchange rate is squabbling around $28,000 (3,720,000 yen), which is the milestone level.

[Fig. 1: BTC vs Yen chart (1 hour)]Source: Created from bitbank.cc

As concerns about the US financial system recede and stock prices try to recover, expectations for an interest rate hike in May are gradually reviving, and US Treasury yields have stabilized this week. BTC failed to attempt a breakout from the high range this week, supported by rising altcoins. Currently, altcoins are on an adjustment trend ahead of the release of the US Personal Consumption Expenditure (PCE) price index, and are stalling.

The interest rate trend of the US Federal Reserve (Fed) is once again in focus, and the PCE price index is likely to provide a clue as to the direction of the BTC price in the near term. Concerns about the financial system and, in turn, the economic slowdown led to a drop in energy prices in March, and reports of job cuts at US IT companies made headlines. minute data.

The market expects a slowdown in the PCE price index, but February’s consumer price index (CPI) surprises with an acceleration from January in the core index compared to the previous month. However, from the latest sentiment and technical aspects, BTC continues to be bullish, with downside potential around the lower end of the high range of $26,500.

Contributor: Yuya HasegawaYuya Hasegawa

After graduating from a graduate school in the UK, he worked as an analyst in the FinTech industry and the virtual currency market at a venture company consisting of people from financial institutions. Market analyst at Bitbank Co., Ltd. since 2019. He has a track record of providing comments to major domestic financial media and contributing to overseas media.

connection:bitbank_markets official website

Last report:Is there room for Bitcoin to rise in the manifestation of “three roles turn around”?

The post Altcoin, with XRP at the top of the list, is Bitcoin continuing to be a bull market | Contribution by bitbank analyst appeared first on Our Bitcoin News.

Weekly Virtual Currency News | Micro Strategy buys more BTC, etc., attracting attention to public comment responses from the Financial Services Agency

https://ourbitcoinnews.com/weekly-virtual-currency-news-micro-strategy-buys-more-btc-etc-attracting-attention-to-public-comment-responses-from-the-financial-services-agency/

news of the week

We will deliver the news mainly for one week (3/25-3/31).

This week, the most widely read news was that the Financial Services Agency responded to public comments asking whether NFTs (non-fungible tokens) are eligible for crypto assets (virtual currencies).

Regarding the market, the report on the 28th, which summarizes the impact of the US Commodity Futures Trading Commission (CFTC)’s lawsuit on Binance and the reversal of XRP, is attracting attention.

In addition, an article that reported that the US business intelligence company “MicroStrategy” increased its purchase of Bitcoin (BTC) also attracted a lot of attention.


table of contents
  1. This week’s news ranking
  2. Market news ranking
  3. Virtual Currency/Blockchain Industry News

This week’s news ranking

1st place: Financial Services Agency responds to public comments asking whether NFTs are eligible for crypto assets (3/25)

On the 24th, the Financial Services Agency (FSA) released responses to the public comments it solicited in December last year regarding its views on the eligibility of various tokens as crypto assets and how to supervise acquired crypto asset exchange companies. (the article ishere)

2nd place: US Micro Strategy, additional purchase of about 20 billion yen worth of Bitcoin (3/28)

MicroStrategy announced on the 27th that it had purchased $150 million worth of Bitcoin. The company’s holdings of Bitcoin increased to 138,955 BTC. (the article ishere)

3rd place: US CFTC sues Binance and Mr. CZ for alleged violation of US law (3/28)

The US CFTC announced on the 27th that it has filed a lawsuit against Binance and its CEO Changpong Zhao (CZ). The company has taken issue with the provision of derivative trading services in the United States without intentionally registering with the CFTC. (the article ishere)

Market news ranking

1st place: CFTC’s Binance lawsuit dominates cryptocurrency selling, Ripple trial speculation XRP goes backwards (3/28)

BNB fell 5.1% from the previous day as selling dominated the cryptocurrency market after the CFTC filed a lawsuit against Binance. Due to the speculation of the Ripple trial, XRP rose by 7.5% from the previous day (26.9% from the previous month), a retrograde high. (the article ishere)

2nd place: Professional analysis of Bitcoin derivatives market before major SQ | Contribution: Virtual NISHI (3/30)

A financial professional analyzes the Bitcoin derivatives market, which plunged temporarily in response to the CFTC lawsuit against Binance before the major SQ. “Virtual NISHI”, a crypto analyst at the crypto asset exchange SBI VC Trade, explained the market trends. (the article ishere)

3rd place: The monthly trading volume of Ethereum futures is at the highest level since May last year as Bitcoin struggles in the latest high price range (3/31)

Investor sentiment improved on the day, as the financial instability surrounding the bank failures that had shaken the market receded thanks to prompt responses by the financial authorities in Europe and the United States. Since the beginning of the year, bitcoin has been trending at the latest highs while increasing its upper price. (the article ishere)

Virtual Currency/Blockchain Industry News

Disney dismantles Metaverse division as part of business restructuring = report (3/29)

It turned out that Walt Disney in the United States dismantled the department promoting the Metaverse (virtual space) concept. We are dismantling the Metaverse division as part of a broader restructuring. (the article ishere)

Mitsubishi UFJ Trust and Banking Co., Ltd. started technical collaboration in preparation for interoperability of domestically issued stablecoins (March 28)

Mitsubishi UFJ Trust and Banking Corporation has started a technical partnership with Datachain Co., Ltd. and Soramitsu Co., Ltd. on the 28th to realize smooth mutual transfers and exchanges between various stablecoins scheduled to be issued in Japan. announced. (the article ishere)

Elon Musk and AI researchers request a temporary suspension of next-generation AI model development (3/30)

On the 29th, an online signature campaign was launched asking all research institutes to suspend the development of a next-generation AI system that is more powerful than the AI ​​language model “GPT-4” released by OpenAI in March. More than 1,300 signatures have been collected, including Tesla founder Elon Musk and Apple co-founder Steve Wozniak (at the time of writing). (the article ishere)

Bank of Japan Governor Kuroda mentions a payment system for “Shin individuals” in his speech at Finsome 2023 (March 29)

In a speech on the 28th, Bank of Japan Governor Haruhiko Kuroda referred to a central bank-issued digital currency (CBDC), saying, “We have to realize it in the future, and I think it will.” He expressed his opinion. (the article ishere)

U.S. SEC Chairman Gensler mentions virtual currency in congressional testimony and also answers questions on securities law (3/30)

U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler testified before the U.S. House Appropriations Subcommittee on the 29th, and also mentioned cryptocurrencies. He also spoke about the application of securities laws. (the article ishere)

Yuzo Kano to return to president of virtual currency exchange bitFlyer (3/31)

bitFlyer Holdings, which operates a major crypto asset exchange company in Japan, announced that its founder and major shareholder, Yuzo Kano, will return to the post of CEO. The election of a new director was resolved at the shareholders’ meeting on the 30th. (the article ishere)

Binance may have misrepresented China base = report (3/30)

For several years, Binance has reportedly been more active in China than the public has reported. CZ and other company executives instructed employees to hide the existence of some of the company’s offices in China, according to internal documents. (the article ishere)

The post Weekly Virtual Currency News | Micro Strategy buys more BTC, etc., attracting attention to public comment responses from the Financial Services Agency appeared first on Our Bitcoin News.

Galaxy Digital CEO Mike Novogratz Claims US Government is Hostile Towards Crypto Industry

https://blockchainreporter.net/galaxy-digital-ceo-mike-novogratz-claims-us-government-is-hostile-towards-crypto/

Galaxy Digital CEO, Mike Novogratz, has recently expressed his concerns regarding the US government’s treatment of the crypto industry. In a Bloomberg interview, Novogratz stated that the Biden administration “doesn’t like crypto,” adding that the unraveling of FTX and its founder, Sam Bankman-Fried, is partially responsible for the hostile treatment.

Novogratz claims that Bankman-Fried, who was Joe Biden’s biggest donor and the biggest donor to the Democratic Party, was involved in a close relationship with the SEC and CFTC. As a result, the Democrats are now trying to distance themselves from the crypto industry, which has resulted in the small cabal of individuals, including Senator Elizabeth Warren and SEC Chair Gary Gensler, attempting to “crush crypto.”

The Crypto Industry will Continue to Thrive

Despite this, Novogratz remains bullish on the crypto industry, stating that the crypto community is “re-energized” and will not be easily deterred. He believes that the crypto community is resilient and that the industry will continue to thrive, despite the hostile treatment from the US government.

Furthermore, Novogratz notes that the Middle East and Asia are now home to some of the world’s most crypto-friendly jurisdictions, while the US remains hostile towards the industry. Abu Dhabi and Hong Kong, in particular, are cited as two jurisdictions that have developed a friendly crypto regime.

Novogratz’s concerns regarding the US government’s treatment of the crypto industry are not new. In recent months, there has been growing concern among the crypto community regarding potential regulatory actions that could stifle innovation and growth in the industry. The SEC, in particular, has been taking a closer look at the crypto industry, with SEC Chair Gary Gensler stating that the agency will be focusing on the regulation of cryptocurrencies and initial coin offerings.

Despite these concerns, the crypto industry continues to grow and evolve. The recent surge in the price of Bitcoin and other cryptocurrencies is a testament to the resilience of the industry and the strong support of the cryptocurrency community. However, it remains to be seen how the US government’s treatment of the industry will impact its future growth and development.

Volatility in Review: March 2023

https://insights.deribit.com/industry/volatility-in-review-march-2023/

Macroeconomic news and monetary policy announcements from the central banks of several key economies led movements in implied volatility over the last month as traders looked to cover their exposure to further interest rate hikes and depeg dangers.

The market has priced and repriced both the level and skew of the volatility smile several times in response, reevaluating its relative positioning between BTC and ETH options.

Implied Vol

At-the-money

Figure 1 Hourly at-the-money implied volatility of BTC options at a 1W (blue), 1M (grey), 3M (yellow), 6M (green) 1st Mar 2023. Source: Block Scholes

At-the-money volatility was stable and near to the lower end of its historic range in late February and early March. The failure of several US banks, the depeg of USDC, and cascading concerns for the health of the financial system in response to rising interest rates caused vol expectations to pick up strongly by the second week. That volatility has continued following the strong spot price performance in the last two weeks, as well as the continuing fallout in banks not only in the US, but in Europe also.

These events have prompted several strong narratives to be considered and reconsidered by the market, including the possibility that Bitcoin is finally proved to be the inflation hedge that it has long been touted as. To many, the most recent bout of bank failures and bailouts is reminiscent of the Great Financial Crisis of 2008, a narrative that markets appear to have been keenly aware of as BTC tests a new upper barrier at $28K. Whilst, the circumstances between that period and today are drastically different, such actions play into one of Bitcoin’s (and crypto’s) original value propositions.

However, the FOMC meeting on the 22nd March confirmed broad market expectations of a 25 bps rate hike by the Fed saw short term volatility expectations fall sharply. This event signalled the end of the short-lived inversion of the term structure of volatility, which has continued to trend downwards at all tenors. This phenomenon has been common to many of the FOMC announcements over the last 12 months, as crypto-assets become sensitive to macroeconomic drivers and traders look to hedge uncertainty into an important announcement.

BTC and ETH Vol

Figure 2 Hourly at-the-money implied volatility of BTC (grey) and ETH (purple) options at a 1M tenor from 1st Jan 2023. Source: Block Scholes

ETH’s derivatives market has broadly traced the same movements as BTC’s during the first few months of the year, rising sharply as both assets enjoyed a late January rally, and trading broadly sideways at a historically low level in late February. However, ETH options have long expressed a 10-15 vol point premium to BTC options at an equivalent strike and tenor, a phenomenon that we have recorded since January 2022.

Figure 3 Hourly at-the-money realised volatility of BTC (grey) and ETH (purple) with a 7 day lookback 16th Sep 2023. Source: Block Scholes

Ether’s higher volatility expectations are likely due to the consistently higher realised volatility posted by ETH, a factor that became more pronounced during the several selloffs of 2022. The most recent bullish spot action has seen BTC outperform ETH’s spot price as its realised volatility dominated that of the latter token, which goes some way to explain the convergence in their implied volatility over the same time period.

The reasons for the higher realised volatility are less clear to us. Shorter term factors that explain the increase in the growth in the discrepancy between the realised vols of both assets over 2022 include the higher sensitivity to negative macroeconomic factors via stablecoins or other DeFi-specific drivers. Bitcoin’s network is less directly reliant on centralised and traditional finance, whereas Ethereum’s ecosystem is sustained by centralised stablecoins that are banked by cash and cash-equivalent deposits at centralised institutions. Those links to traditional financial institutions have acted as inlets for the troubles faced by several banks in the US.

Additionally, the SEC have recently brought action against Paxos, the issuer of the BUSD stablecoin, which has had implications for their view on the rest of the crypto ecosystem. Chairman Gary Gensler went so far as to state that “everything but Bitcoin is a security”, highlighting the difference in the way the market and regulators are thinking about the two assets.

Vol Smile Skew

Figure 4 Hourly SABR calibrated skew parameter of BTC options at a 1W (blue), 1M (grey), 3M (yellow), 6M (green) 1st Mar 2023. Source: Block Scholes

The turnaround in market sentiment following the restoration of the USDC depeg was clearer nowhere more than in the skew of the volatility smile. The market began the month by expressing a roughly symmetric sentiment towards both up and downside protection at a 1 week tenor, with a negative tilt further out along the term structure than 1W.

News that 8% of USDC’s reserves were held by the troubled Silicon Valley Bank and fear of contagion to other crypto-assets, particularly to the Ethereum ecosystem, saw the vol smile skew heavily to the left as downside protection saw an increase in demand. Soon after, however, the announcement that issuers Circle would cover any shortfall in reserves saw the swift recovery of the stablecoins peg, as well as a reversal in the skew of BTC’s vol smile towards OTM puts.

That skew returned somewhat in the busy week of macroeconomic data releases that followed. Longer dated options reported a more neutral smile, until the most recent spot rally on the 29th March saw short term optionality express a preference for upside participation.

ETH Skew lags BTC’s

Figure 5 Hourly SABR calibrated skew parameter of BTC (grey) and ETH (purple) options at a 1M tenor from 1st Jan 2023. Source: Block Scholes

Despite ETH’s implied volatility moving closer to that of BTC’s over the past month and resolving the difference in implied volatility between the two assets’ options, ETH’s volatility smile remains skewed distinctly further towards OTM puts. This is present across the term structure, with the divergence between the asset’s options growing near to a 4M tenor.

Figure 6 Hourly implied volatility of 25-delta BTC calls (blue) and puts (pink) at a 1 month tenor from 10th Feb 2023. Source: Block Scholes

We can look at the implied vol dynamics of ETH’s OTM calls and puts to get a better understanding of what is causing the more pessimistic skew value.The implied vol of 25 delta, 1 month puts has traded near to the elevated levels to which it spiked in response to the USDC depeg, oscillating around the 65% level. It was ETH’s OTM calls (shown in Figure 6 by 25 delta, 1 month expiry calls) that saw a decrease in implied volatility in the last week, causing a return of the skew towards OTM puts.

AUTHOR(S)

Block Scholes Block Scholes

Trading with a competitive edge. Providing robust quantitative modelling and pricing engines across crypto derivatives and risk metrics.


THANKS TO

Andrew Melville, Block Scholes

RECENT ARTICLES

The post Volatility in Review: March 2023 appeared first on Deribit Insights.

Ripple CEO says SEC Chair Gensler Behaves Like an ‘Autocrat’

https://bitcoinwarrior.net/2023/04/ripple-ceo-says-sec-chair-gensler-behaves-like-an-autocrat/

gary gensalr

The post Ripple CEO says SEC Chair Gensler Behaves Like an ‘Autocrat’ appeared first on Coinpedia Fintech News

In the midst of the ongoing legal dispute over the XRP token’s nature, brad garlinghouse 
Brad Garlinghouse is one of the world’s largest crypto payments processors; he is an extremely popular name across the global crypto landscape. He has previously served as the CEO of Hightail, a file-sharing service, and is also an active angel investor. He is currently serving as the CEO of financial technology company Ripple Labs. He joined Ripple as COO in April 2015, answering to the CEO and prime supporter, Chris Larsen. He was elevated to CEO in December 2016.

Previously, he also worked at AOL and Yahoo! From 2003 to 2008, he filled in as Senior Vice President at Yahoo!, where he ran its Homepage, Flickr, Yahoo! Mail, and Yahoo! Courier divisions. While at Yahoo!, he wrote an inner update known as the “Peanut Butter Manifesto,” requiring the organization to zero in on its core business instead of extending itself excessively far, much like peanut butter.

EntrepreneurInvestorChief Executive OfficerBoard Member, CEO of Ripple, launched a new attack on the U.S. Securities and Exchange Commission (SEC). gary gensler




Gary Gensler is an enthusiastic leader and the current chair of the U.S. Securities and Exchange Commission (SEC). He has the extreme experience that spans wall street, government regulation, and an angel teaching about cryptocurrencies and blockchain at MIT. He announced several initiatives to enhance investor protections in the $2 trillion cryptocurrency market. He previously led the Biden-Harris transition’s federal reserve, Banking, and securities regulation agency review team. 

He was awarded Treasury’s highest honor, the Alexander Hamilton Award, and also was a recipient of the 2014 Frankel Fiduciary Prize. He was born on October 18, 1957, into a Jewish family, in Baltimore, Maryland. Graduated from the University of Pennsylvania, earning a Master’s degree in Business Administration. Additionally, he is also a professor at the MIT Sloan School of management. He has served in various governmental roles since the 1990s, such as the treasury department, Sarbanes-Oxley, CFTC, Swaps, Enforcement, Libor investigation, Maryland Financial Consumer Protection Commission, Securities, and Exchange Commission.

Gary Gensler will probably keep on filling in as seat of the SEC until 2026, accepting his renunciation. He has expressed his desires to present crypto-related approach changes later on that include token commitments, decentralized finance, stablecoins, guardianship, exchange-traded resources, and advancing stages. A few officials as well as his kindred SEC magistrates have scrutinized Gensler for not giving adequate administrative direction on crypto, possibly prompting a standoff between Congress and the association.

The SEC, CFTC, and Financial Crimes Enforcement Network handle advanced resource guidelines in the U.S., however, each with various jurisdictional cases, bringing about an interwoven methodology that crypto firms should explore to work legitimately. Whether 2022 will see a more clear way for organizations in the crypto space is questionable, yet the cosmetics of the SEC’s initiative will fundamentally change following the takeoff of chief Elad Roisman in the first month of the year. Chief Allison Lee’s term is likewise set to terminate in June 2022.

Chairman, the head of the Securities and Exchange Commission, told the House Appropriations Committee that the market for cryptocurrencies can be adequately regulated by the existing securities laws.

Garlinghouse Slams SEC

Ripple (XRP) CEO Brad Garlinghouse said US Securities and Exchange Commission (SEC) Chair Gary Gensler acts like an “autocrat,” urging elected officials to take notice of the regulator. Garlinghouse responded to a news story in which Gensler claimed that the industry is already covered by current regulations, so no new legislation is required.

To which Garlinghouse responded, “For the Chair of the SEC to assert that he dictates what is a security – and not the legislation from which his agency derives its power – is beyond comprehension. It’s time for elected officials in the US to take notice.”

As long as the SEC head acts like an autocrat in charge of a $2.2 billion bloated agency, the authority will never want to be clear about which crypto assets are “in” or “out.” Garlinghouse emphasized that ambiguity can pass for authority in the absence of clear jurisdiction.

Also Read: David Gokhshtein Predicts XRP Price Surge if Ripple Prevails in SEC Case

Garlinghouse’s Opinions Echo Those of Crypto Stakeholders 

The crypto community has long expressed its concerns about the SEC’s approach to Crypto. The commission recently increased its regulatory efforts against the cryptocurrency industry.

Justin Sun, a cryptocurrency entrepreneur, and his businesses are the targets of a new lawsuit from the Commission. Moreover, for failing to register as a national securities exchange, the financial authority also brought charges against the cryptocurrency platform Beaxy.

The legal battle between SEC and Ripple is nearing its end with several crypto attorneys predicting a win for the crypto firm. However, it seems like the SEC is not budging on its regulatory approach.

Billionaire Mike Novogratz Bullish on Bitcoin and Crypto Despite Industry Crackdown – Here’s Why

https://dailyhodl.com/2023/04/01/billionaire-mike-novogratz-warns-crypto-industry-is-under-assault-but-theres-one-reason-keeping-him-bullish/

Galaxy Digital CEO Mike Novogratz believes that the US government is hostile towards the overall crypto industry.

In a new Bloomberg interview, Novogratz says that the administration of US President Joe Biden “doesn’t like crypto.”

According to Novogratz, the unraveling of FTX and its founder Sam Bankman-Fried is partly to blame for the hostile treatment the crypto industry is getting from Washington.

“And so now we’re under assault from the US government.

The Biden administration, the Democratic Party really doesn’t like crypto. Partly, because Sam Bankman-Fried was Joe Biden’s biggest donor. And he was the biggest donor to the Democratic Party. And he was engaged in a really intimate way with the SEC [U.S. Securities and Exchange Commission] and the CFTC [Commodity Futures Trading Commission].

And so the Democrats have egg all over their face and feel, ‘Oh I got to run from this’.

And you know there’s a small cabal… [U.S. Senator] Elizabeth Warren, [U.S. Senator] Sherrod Brown, [SEC Chair] Gary Gensler… that really are trying to, they call it Operation Chokepoint, you know crush crypto.”

The Galaxy Digital CEO says that the fact that the crypto community is “‘re-energized” makes him bullish.

“You’re picking a fight with a crypto community that loves this technology, that believes in it almost with religious fervor, that’s resilient as can be.

And so I’m bullish as can be, not because all the institutions are going to come in. That’s been slowed down. But because the people that started this revolution are re-energized.”

According to Novogratz, the Middle East and Asia now hosts some of the world’s most crypto-friendly jurisdictions at a time when the US is hostile towards the industry.

“We’re seeing overseas that [United Arab Emirates capital] Abu Dhabi is making a really friendly regime. Hong Kong, believe it or not, is coming up with one of the most-friendly crypto regimes…

And so we’re seeing overseas lots of activity. And domestically, a government that’s really trying to smoosh the industry.”

I

Don’t Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox

Check Price Action

Follow us on Twitter, Facebook and Telegram

Surf The Daily Hodl Mix

Check Latest News Headlines

&nbsp

Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

Generated Image: Midjourney

The post Billionaire Mike Novogratz Bullish on Bitcoin and Crypto Despite Industry Crackdown – Here’s Why appeared first on The Daily Hodl.

Crypto exchange Bittrex, once a U.S. leader, is shutting down in the country after volumes dwindled to less than 1% of the market, and blaming regulatory uncertainty

https://www.theblock.co/post/224379/bittrex-shutting-us-operations

Choke Point or no Choke Point, Bittrex says it’s leaving the U.S. and it’s placing the blame flat on Uncle Sam. 

"It’s just not economically viable for us to continue to operate in the current U.S. regulatory and economic environment," co-founder and CEO Richie Lai said in a message to customers in the country on Friday. "Regulatory requirements are often unclear and enforced without appropriate discussion or input, resulting in an uneven competitive landscape."

With exchanges including Coinbase, Kraken and Binance all facing legal scrutiny from multiple U.S. regulators in recent months, a growing chorus of industry watchers has been calling for regulatory clarity as the issue starts to take on political tones ahead of an election year. Galaxy Digital CEO Michael Novogratz on Thursday said the crypto industry was “under assault” from U.S. regulators and that he believed “Operation Choke Point 2.0,” a term used by some to speculate about the possibility of a broader, coordinated crackdown, was real. 

Securities and Exchange Commission Chair Gary Gensler said earlier this week that he didn’t believe additional legislation was needed for the industry. 

Bittrex volume had been dropping

While recent regulatory issues may have played a role in the exchange’s decision to depart from the country, it’s probably not the only reason, according to The Block research director Steven Zheng.

“Their volume in the U.S. is low enough that it isn’t worth the effort to continue maintaining operations,” he said, pointing to the planform’s bitcoin volume of just $4.5 million over the past 24 hours. 

graph of Bitrex Volume

Bittrex had been one of the largest exchanges in the U.S., with a market share of USD support of nearly 23% at the start of 2018, according to data from The Block. It collapsed to below 1% in 2021 and hasn’t recovered since. 

The exchange has had it’s fair share of problems with regulators in the country. In 2022, the Office of Foreign Asset Control and the Financial Crimes Enforcement Network announced settlements totaling $29 million with the company over its alleged facilitation of sanctioned transactions between 2014 and 2017. In 2019, the New York State Department of Financial Services denied the company a BitLicense needed to operate in the state.

When asked if the company was attributing all of the lost market share to the regulatory troubles, a spokesperson referenced Lai’s earlier statement and additional FAQ on the matter. Customers outside of the U.S. will not be affected.

Lai said that all customer funds were safe, and withdrawals for users who have met verification requirements will be processed until April 30.  

"Regulatory requirements are often unclear and enforced without appropriate discussion or input, resulting in an uneven competitive landscape," he said, adding that he would shift his focus to "helping Bittrex Global succeed outside the U.S."

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Cryptos Brace for More Enforcement Actions as SEC Seeks $2B Funding to Tame ‘Misconduct’

https://zycrypto.com/cryptos-brace-for-more-enforcement-actions-as-sec-seeks-2b-funding-to-tame-misconduct/

  • The agency brought 750 enforcement actions in the fiscal year 2022.
  • Chairman Gensler says the digital asset sector is rife with non-compliance. 

Gary Gensler, the Securities and Exchange Commission (SEC) Chair, is pushing for additional funding to increase oversight, especially in the cryptocurrency sector.

On Wednesday, Gensler told the House sub-committee on financial services that he supports President Joe Biden’s $2.4 billion funding allocation to the agency for the fiscal year 2024 to create additional 170 positions. He noted the number of positions in the SEC currently funded by Congress was 5,303 in the fiscal year of 2023, an increase of 400 from that of 2022.

According to the SEC chair, part of the funding would be directed toward taming non-compliance in the cryptocurrency sector due to the rapid sector growth.

“We have seen the Wild West of the crypto markets, rife with non-compliance, where investors have put hard-earned assets at risk in a highly speculative asset class,” he said. “Such growth and rapid change also means a possibility for wrongdoing. As the cop on the beat, we must be able to meet the match of bad actors.”

Gensler’s testimony came the same day the commission closed the crypto trading platform Beaxy and charged its current and former executives for gambling users’ funds and offering unregistered security, Beaxy token (BXY).

750 enforcement actions in FY2022

In total, the commission brought more than 750 enforcement actions in the fiscal year 2022 – an increase of 9% year-over-year – resulting in $6.4 billion in civil penalties and disgorgement, says Gensler. Cryptocurrency exchange Kraken, for instance, had to pay a $30 million fine to the SEC at the beginning of the year. Tron Foundation and its founder Justin Sun is also being investigated for failing to register Tronix (TRX) and BitTorrent (BTT) tokens.

Over the years, there has been an increase in the number of separate tips, complaints, and referrals from whistleblowers received by the commission, with those in FY2022 at 35,000. The authority also conducted over 3,000 examinations in tens of thousands of registrants, from investment advisers to broker-dealers to exchanges.

Gary Gensler: Stop Taking Out Your Crypto Problems on Celebrities

https://blockworks.co/news/sec-cftc-crypto-celebrities

The recent burst of legal action brought against celebrities over the promotion of various crypto assets underscores just how bewildering the regulatory environment for this transformative technology has become in the United States. 

How can anyone engage with crypto with any degree of confidence when the CFTC throws its weight around in one direction as the SEC, along with other agencies, make moves in seemingly contradictory directions? Clearly, the regulators are fighting something of a turf war, and everyone else, celebrities included, is left scratching heads. 

Before I go any further, let me be clear. This is not a blanket defense of celebrity endorsements of whatever coin or NFT project. Our industry certainly has been plagued by influencer-peddled pump-and-dump scams that have hurt retail investors. This fact is undeniable, and my colleagues and I welcome fair and rigorous regulatory oversight. And I should emphasize that it’s undoubtedly critical that to ensure protection of investors, celebrities should be transparent and in turn disclose any material connections when it comes to endorsements, including compensation received.

But the sheer lack of inter-agency consensus over crypto assets doesn’t seem to be doing much to help protect investors from scams. It’s mostly just raising questions, namely: Who’s actually in charge? 

If it looks like a security, but it talks like a commodity

The fines imposed by the SEC against, among others, Lindsay Lohan, Akon and Kim Kardashian have largely centered on the purported failure to properly disclose payments received for crypto endorsements. 

In a release in October explaining the agency’s $1.26 million fine against Kardashian over promoting a rather obscure coin, Chair Gary Gensler argued that penalizing her over non-compliance with the law served “as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote investing in securities.”

There could be some merit to the SEC’s arguments, but a critical word used by Gensler is “securities.” Are crypto assets actually securities as defined by the law? Or are they something else and outside of the jurisdiction of the SEC, such as commodities, which is the classification that the CFTC seems to favor? For example, in its recent legal action against Binance, the CFTC seems to have defied the SEC by arguing ether, litecoin and stablecoins including USDT and BUSD are in fact commodities. Yet the SEC has declared the BUSD stablecoin as an unregistered security and has hinted that it considers ether to be the same. 

There are nuances between the SEC and CFTC pertaining to endorsements, as well as with the Federal Trade Commission. Specifically, the nuances involve potential irregularities surrounding what constitutes an endorsement, what disclosure is required, legal liability and enforcement action. 

Parsing through the various legal interpretations and penalties that could potentially be imposed in these situations is hard enough, but it’s headache-inducing when the agencies involved can’t seem to come to agreement on how to actually classify crypto in the first place. 

Welcome to regulatory limbo

Globally, crypto is popular – not just among those living in countries with failing currencies and weak or non-existent banking systems, but also among young and tech-savvy audiences. It therefore makes sense that celebrities would seek to engage those audiences through something popular and highly useful like crypto.

More broadly, the crypto industry itself is more than just confused. We’re becoming rather concerned. Increasingly, there is suspicion that US authorities are deliberately and unlawfully attempting to snuff out the crypto industry in what’s been dubbed Operation Chokepoint 2.0. Many argue that as a result of the latter operation, crypto-friendly banks and crypto ventures themselves have been unfairly – or even unlawfully – targeted. 

I’ll hold off on providing an opinion on whether Operation Chokepoint 2.0 is real or not – and whether the associated actions are actually lawful – but it certainly seems as though those like Lohan and Kardashian appear to have been caught up with the rest of us in the regulatory crossfire.

Pack your bags

Many of us in the crypto industry have long been willing to work with regulators and lawmakers to help formulate robust investor-protection laws, including technology-focused solutions that provide safeguards surrounding advertising and promotions.

But while our industry is more than ready to work diligently and in good faith with authorities to formulate safeguards, ultimately what’s needed is an overarching regulatory framework that clearly spells out the rules of the road. This would reinforce the rule of law in the United States and dampen the suspicion that authorities may be adopting unconstitutional means to stifle our industry. 

If Washington’s end game is to crush the domestic crypto industry, then related startups and entrepreneurs will simply move abroad, thereby depriving Americans of the immense potential benefits of fostering Web3 and financial innovation at home. Already, it seems as though crypto-friendly jurisdictions are capitalizing on this situation, with Hong Kong and Dubai, along with the UK and the EU, opening their arms to American crypto innovators. 

Whether celebrities will begin focusing their crypto-promotional activities abroad, joining what I fear will be a wave of industry startups decamping to other countries, is anyone’s guess.

But if there’s money to be made by advertising in our industry abroad — in a different regulatory environment that can actually give you yes or no answers — then don’t be surprised when you see more and more billboards popping up in Hong Kong or London showcasing your favorite singer or actor touting blockchains and exchanges, footloose and fancy free. 



Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.

Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.

Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


Crypto Crackdown: SEC Seeks More Funding, New Proposal To Ban Crypto Wallets

https://blockonomi.com/crypto-crackdown-sec-seeks-more-funding-new-proposal-to-ban-crypto-wallets/

With the increased level of the crackdown, funding is crucial for the SEC to enforce cryptocurrencies and other financial products effectively.

On March 29, the U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler requested an additional budget of $2.4 billion, citing an increased effort to conduct investigations and bring legal actions to “misconduct.”

Part of the funding will be used to invest in “new tools, expertise, and resources” required to keep up with the fast-paced industry. Alternatively, the SEC plans to expand its enforcement team by adding 170 new members.

The SEC Wants to Grow

The agency’s Division of Enforcement is responsible for investigating and prosecuting violations of federal securities laws, including those related to cryptocurrencies.

In 2022, the agency reportedly handled “more than 35,000 separate tips, complaints, and referrals from whistleblowers and others.”

The SEC brought 750 enforcement actions upon processing these claims, with crypto-related cases accounting for 250 actions. The total value of crypto fines spiked in 2022 at $242 million, representing a 36% increase over the 22 actions announced in 2021.

The SEC’s request came after the agency alleged the Beaxy crypto exchange and its executives for conducting an unregistered securities offering. Beaxy had to shut down its operation in the U.S. following the charges.

The exchange’s founder, Artak Hamazaspyan, was also accused of illegally raising $8 million in an unregistered securities offering of the native token BXY.

The SEC claimed that Hamazaspian embezzled $900,000 in funds for personal use. The agency also brought charges against other executives, Nicholas Murphy and Randolph Bay Abbott.

The U.S. Securities and Exchange Commission (SEC) has become increasingly active in bringing cryptocurrency companies and individuals to justice. Over the last few months, several claims and notices have been filed against prominent names in the industry.

Some notable cases included crypto exchanges Kraken, Genisis, the issuer of Binance USD (BUSD) Paxos, TRON’s founder Justin Sun, and most recently, top crypto exchange Coinbase.

Unstoppable Moves

On Wednesday, Massachusetts Senator Elizabeth Warren reintroduced a proposal called the “Digital Assets Anti-Money Laundering Act” to ban crypto wallets.

  • The proposal debuted in December 2022, focusing on increased consumer protection by prohibiting digital asset mixers and tightening non-custodial wallets.
  • The proposed Digital Assets Anti-Money Laundering Act has sparked a heated debate in the crypto community.
  • While some argue that it is necessary to regulate the crypto industry to prevent illicit activities, others believe the proposed ban on crypto wallets is not the answer.
  • Critics of the bill argue that it is misguided and that banning crypto wallets would be ineffective in preventing money laundering and harm legitimate users who rely on non-custodial wallets for privacy and security reasons.
  • In response to the criticism, Senator Elizabeth Warren defended her proposal, stating that closing the loopholes that allow criminals to use crypto to launder money and finance illegal activities is necessary.
  • She argues that by banning crypto wallets, the government can prevent bad actors from hiding their identities and tracing the flow of funds, making it easier to catch criminals.
  • The proposed bill has also received criticism from industry leaders and organizations, including the Blockchain Association, who argue that it is too broad and could stifle innovation in the crypto industry.
  • They suggest that instead of a ban, the government should focus on implementing effective regulation that balances consumer protection with innovation.

No entity can escape the power of the laws. Proper regulations are required to protect the crypto users. At the same time, regulators are called to embrace the natural law of evolution. The unstoppable effort to crack down on the industry is a double-edged sword; it could kill innovation.

Clearly, the moves in the U.S. are anti-crypto, but they are not global in scope.

The post Crypto Crackdown: SEC Seeks More Funding, New Proposal To Ban Crypto Wallets appeared first on Blockonomi.

Crypto Didn’t Cause the Banking Crisis

https://www.galaxy.com/research/insights/crypto-didnt-cause-banking-crisis/

This note was sent to Galaxy clients and counterparties on Monday, March 13, 2023.

Signature Bank director Barney Frank told CNBC Monday that he thinks “part of what happened was that regulators wanted to send a very strong anti-crypto message” and that Signature Bank officials believed they had stabilized on Sunday and that there was “no real objective reason” that Signature had to close and the bank was ready to open “as a going concern.” The flip-flopping here, and the suggestion that Signature was solvent and taken over for political reasons, is extremely troubling. The U.S. regulatory attack on the cryptocurrency industry continues and stands in stark contrast to the progressive frameworks being introduced around the world.

But beyond the political attack, there’s been a lot of commentary suggesting that cryptocurrency is to blame for the bank crisis of the last 72 hours. For a variety of reasons, we don’t believe this is a fair criticism. While it’s easy to make this association–Silvergate and Signature were mainstay players in the cryptocurrency industry and SVB was the key bank for the venture and private equity complexes–the reality is that the factors leading to the current crisis are more nuanced and diverse:

  • The failure of central banks and policymakers to caution about impending inflation and the way in which they dealt with inflation when it happened. Many federal officials, including Federal Reserve Chairman Jay Powell and Treasury Secretary Janet Yellen, repeatedly downplayed the likelihood of high inflation in 2021, despite a cacophony of voices predicting it would rise in the face of unprecedented monetary policy loosening and government stimulus checks. The speed of their narrative pivot toward the end of 2021, first to “inflation is transitory” and then to the start of the fastest rate-hike regime in American history, clearly caught many banks off-guard. The national regulatory and administrative leaders of the banking industry repeatedly assured the world – and the banking sector – that inflation was not a fear and rates would not rise. They were catastrophically wrong. Banks are now sitting on more than $620bn of unrealized losses on fixed-income securities that they essentially had no choice but to buy given a lack of yield-generating alternatives in a ZIRP environment. The fact that the Federal Home Loan Banks (FHLBs)—another source of wholesale funding for banks (the central bank being the other)—are raising an additional $64bn is another significant data point showing distress across the banking sector. The cryptocurrency industry isn’t responsible for this.

  • Bank management of assets & liabilities. It’s clear that Silvergate and SVB each had 1) deposit bases highly correlated within specific industries and 2) duration mismatch issues stemming from a giant portfolio of underwater fixed-income securities. However, in the case of Silvergate, whose deposit base consisted largely of crypto-related companies, the bank didn’t actually require a bailout, backstop, takeover, or receivership. Indeed, depositors at Silvergate didn’t actually lose funds there. At SVB, the concentration wasn’t crypto-specific at all, but rather venture-specific. While Circle was one of the biggest depositors—it had $3.3bn there—Circle couldn’t pull its funds from the bank, and thus didn’t contribute to the run. We still don’t know why Signature was seized (although is still operating), but NYDFS Superintendent Adrienne Harris is downplaying crypto as the reason for the takeover, telling CoinDesk that Signature Bank had “a broad depositor base, so this idea that it is a crypto-based bank is not an accurate one.” (This comment appears to contrast with director Barney Frank’s suggestion). Put simply, rising rates broke the banks. And federal officials are rightly worried that rates could break more banks. The simple reason why is that, when the Fed raises rates, the yields on short-dated risk-free treasury bills rise. At the same time, banks with illiquid and/or fixed-rate loan and securities books—i.e., the yields on them are fixed over a term—that they acquired before rates skyrocketed will generate much lower returns relative to the rising cost of deposit funding. This simultaneously causes the banks’ fixed-income portfolios to trade at a discount to par value and can lead to depositor outflows as they seek higher yields. If depositor outflows are significant enough, the banks need to sell their fixed-income securities to generate cash and meet depositor withdrawal demand, but because they trade at a discount, the sales happen at a realized loss, further impeding bank balance sheets.

The banks we’ve seen fail and/or be taken over so far were particularly offsides on those fixed income bets (or whatever happened at Signature… we still don’t really know), essentially having bought the top in the fixed income market just before rates rose dramatically and not effectively or sufficiently hedging their interest rates exposure. But many banks also have bonds that are trading below par.

Looking Ahead

The cryptocurrency industry has been facing banking challenges since the start of the year when U.S. banking regulators first issued a joint statement concerning banks’ exposure to crypto deposits. Despite assurance from those regulators at the time that “banking organizations are neither prohibited nor discouraged from providing banking services to customers of any specific class or type, as permitted by law or regulation,” (we wrote at length about this statement in the Jan. 13 edition of our weekly newsletter) subsequent actions, including the denial of Custodia Bank’s Fed membership and master account (which we wrote about on Feb. 3), have further chilled the banking sector’s appetite for servicing the fast-growing industry. The losses of Silvergate SEN and Signature’s SIGNET (if it does indeed close or halt servicing the crypto industry) will exacerbate the situation and impact the speed of transfers and liquidity in crypto markets. Bigger firms have been able to obtain and maintain accounts at several big banks, and several smaller banks continue to provide access including to facilitate trading on exchanges. But smaller cryptocurrency businesses are increasingly finding it difficult to obtain even basic business checking accounts in the United States.

While the operating environment in the U.S. is becoming more challenging, the bull case for Bitcoin is on full display. Often erroneously thought of as an inflation hedge, Bitcoin should be thought of as a protest against the banking system and monetary policy. That’s what it is on a fundamental level–a non-sovereign fixed-supply global commodity money that cannot be seized, censored, or debased. Broadly speaking, the core value proposition of decentralized cryptocurrencies is the ability to be your own bank, make your own payments, and opt out of the traditional financial system. Bitcoin is up significantly today, a sign that markets are fleeing to the safety it provides not only from within the cryptoasset ecosystem, but also perhaps from without.

And other jurisdictions recognize the power of this transformative concept. In the U.K. recently, HM Treasury produced a comprehensive framework for incorporating crypto assets into the country’s existing capital markets regulatory regime. While that framework still requires regulatory approval, guidance was issued for a range of underlying activities, including custody, trading, lending, borrowing, and more. If the FCA adopts the recommendations, the U.K. will become one of the most progressive, safe, and supportive regulatory environments in the world for crypto assets. Already several U.K. firms have announced significant plans to expand headcount.

Europe took a different but equally commendable approach. Rather than incorporate crypto assets into existing oversight regimes as the U.K. is doing and SEC Chairman Gary Gensler says he wants to do, the European Commission is in the final stages of formalizing a comprehensive crypto-specific regulatory regime — the so-called Markets in Crypto Assets (MiCA). MiCA provides comprehensive guidance for how crypto firms can conduct a wide range of activities compliantly in the European Union.

The picture looks similar as you head East. From the Middle East to the South Pacific and even Hong Kong, ambivalence or obstruction is giving way to regulatory clarity and progressive, thoughtful engagement. Indeed, all around the world, there are public ETFs and other market access vehicles, support from governments, and emerging regulatory clarity.

While we want to see a more supportive approach to cryptocurrency in the United States, Bitcoin is global, and the world sees the promise.

Legal Disclosure:
This document, and the information contained herein, has been provided to you by Galaxy Digital Holdings LP and its affiliates (“Galaxy Digital”) solely for informational purposes. This document may not be reproduced or redistributed in whole or in part, in any format, without the express written approval of Galaxy Digital. Neither the information, nor any opinion contained in this document, constitutes an offer to buy or sell, or a solicitation of an offer to buy or sell, any advisory services, securities, futures, options or other financial instruments or to participate in any advisory services or trading strategy. Nothing contained in this document constitutes investment, legal or tax advice or is an endorsementof any of the digital assets or companies mentioned herein. You should make your own investigations and evaluations of the information herein. Any decisions based on information contained in this document are the sole responsibility of the reader. Certain statements in this document reflect Galaxy Digital’s views, estimates, opinions or predictions (which may be based on proprietary models and assumptions, including, in particular, Galaxy Digital’s views on the current and future market for certain digital assets), and there is no guarantee that these views, estimates, opinions or predictions are currently accurate or that they will be ultimately realized. To the extent these assumptions or models are not correct or circumstances change, the actual performance may vary substantially from, and be less than, the estimates included herein. None of Galaxy Digital nor any of its affiliates, shareholders, partners, members, directors, officers, management, employees or representatives makes any representation or warranty, express or implied, as to the accuracy or completeness of any of the information or any other information (whether communicated in written or oral form) transmitted or made available to you. Each of the aforementioned parties expressly disclaims any and all liability relating to or resulting from the use of this information. Certain information contained herein (including financial information) has been obtained from published and non-published sources. Such information has not been independently verified by Galaxy Digital and, Galaxy Digital, does not assume responsibility for the accuracy of such information. Affiliates of Galaxy Digital may have owned or may own investments in some of the digital assets and protocols discussed in this document. Except where otherwise indicated, the information in this document is based on matters as they exist as of the date of preparation and not as of any future date, and will not be updated or otherwise revised to reflect information that subsequently becomes available, or circumstances existing or changes occurring after the date hereof. This document provides links to other Websites that we think might be of interest to you. Please note that when you click on one of these links, you may be moving to a provider’s website that is not associated with Galaxy Digital. These linked sites and their providers are not controlled by us, and we are not responsible for the contents or the proper operation of any linked site. The inclusion of any link does not imply our endorsement or our adoption of the statements therein. We encourage you to read the terms of use and privacy statements of these linked sites as their policies may differ from ours. The foregoing does not constitute a “research report” as defined by FINRA Rule 2241 or a “debt research report” as defined by FINRA Rule 2242 and was not prepared by Galaxy Digital Partners LLC. For all inquiries, please email [email protected] ©Copyright Galaxy Digital Holdings LP 2022. All rights reserved.

Ripple CEO Continues to Criticize the SEC, Will It Settle the Lawsuit?

https://thenewscrypto.com/ripple-ceo-continues-to-criticize-the-sec-will-it-settle-the-lawsuit/

  • Ripple CEO claims Gensler acted in an autocratic manner.
  • XRP price surged over 25% in a week.

Brad Garlinghouse, CEO of Ripple, expressed his “disappointment” with Securities and Exchange Commission (SEC) Chairman Gary Gensler’s recent remarks about the crypto regulations. Earlier today, Garlinghouse urged American lawmakers to pay attention and consider legislation for the cryptocurrency industry on Twitter.

The SEC chair stated before the House Appropriations Committee hearing on Wednesday that the existing securities laws are sufficient to regulate cryptocurrencies and that no new laws are required. 

While the “XRP community awaits Ripple’s wins against the SEC lawsuit,” Garlinghouse roasted the SEC chair in his recent tweets. According to Brad’s tweet, the SEC chairman asserts that he decides what qualifies as a security rather than relying on the laws from which his agency derives its authority. Also, he claimed that Gensler acted in an “autocratic manner.”

Following that, a pro-XRP attorney pointed out that Ripple executives’ constant criticism of the SEC demonstrates that the blockchain company has no intention of settling a Ripple Vs SEC case. 

XRP’s Dominance in The Market

Recently, the XRP token has buzzed on social media with massive price surges. At the time of writing, XRP traded at $0.532, with a 24-hour trading volume of $2 billion and a market cap of $27 billion. XRP soared over 25% in a week and 44.5% in the last 14 days. But today, the price of XRP is facing ups and downs. Now XRP is declining by around 2%. 

Ripple (XRP) Price Chart (Source: CoinGecko)

Citi Bank Estimates Tokenization to Grow 80x in Private Markets

https://beincrypto.com/citi-bank-estimates-tokenization-80x-private-markets/

Citi Bank predicts in its March report that blockchain-based tokenization will reach a user base of billions and a value of trillions of dollars.

Kathleen Boyle, the managing editor of Citi GPS, has put bets on the tokenization of financial and real assets. The executive notes it to be the “killer use case” of blockchain. The “Money, Tokens and Games” report anticipates that tokenization will increase by a factor of 80x in private markets.

Tokenization and CBDCs in 2030

According to Citi, the acceptance of central bank digital currencies (CBDCs) by major central banks and the use of tokenized assets in gaming and blockchain-based payments on social media will hasten the adoption of blockchain.

The March report underlined, “By 2030, up to $5 trillion of CBDCs could be circulating in major economies in the world…tokenization expected to grow by a factor of 80x in private markets and reach up to almost $4 trillion in value by 2030.”

Tokenization Total Addressable Market Chart by Citigroup

BeInCrypto recently brought attention to strong advances in CBDCs. Reputable banking organizations recently deemed SWIFT’s experimental CBDC Connector pilot tests to have “clear potential and value.”

According to the Atlantic Council, 114 nations comprising more than 95% of the world’s GDP are considering a CBDC. Notably, only 35 nations were contemplating a CBDC two years ago. Meanwhile, 11 countries have already launched a digital version of their sovereign currency.

The surge in the NFT market also represents the rise of tokenized assets in gaming. According to an analysis, the NFT market could gradually expand at a CAGR of 37.1% until 2028. The NFT Spend Value is expected to rise from $46.15 billion in 2022 to $278 billion by 2028.

US Market to Slow Down Adoption?

The U.S. has witnessed an ongoing rise in the legislative debate, pushing tokenization into a difficult position. Recently, the chair of the securities regulator claimed that separate legislation for crypto is unnecessary. Gary Gensler indicated in his statement that the definition of a security, even with regard to digital assets, may be governed by SEC regulations.

In response to the remark, Ripple CEO Brad Garlinghouse called attention to the growing regulatory discussion among US lawmakers.

The SEC chair also referred to the crypto markets’ lack of compliance as the “Wild West” again in his most recent testimony. Meanwhile, Senator Elizabeth Warren has re-ignited calls for a crypto ban from the anti-crypto lobby before her re-election bid.

Meanwhile, the commodities authority recently filed a lawsuit against Binance and founder Changpeng Zhao while unloading a torrent of complaints.

The biggest exchange by volume will defend itself against claims of insider trading and KYC regulations breaches as the Ripple and SEC lawsuit continues to drag on even after two years.

The post Citi Bank Estimates Tokenization to Grow 80x in Private Markets appeared first on BeInCrypto.

‘Choke Point’ is real, Novogratz says after telling Miami crowd ‘we’re under assault’

https://www.theblock.co/post/224138/novogratz-operation-choke-point

Galaxy Digital CEO Mike Novogratz didn’t mince words at a Thursday conference in Miami hosted by the FII Institute, where he told a crowd that the crypto industry was "under assault" by regulators in the U.S.

The Block’s East Coast Managing Editor Nathan Crooks caught up with Novogratz after the event and asked about his thoughts on "Operation Choke Point 2.0," a term being used by some in the industry to speculate about the possibility of a broader, coordinated crackdown.

(The interview has been lightly edited for clarity.)

The Block: You just finished telling the audience here that the crypto industry is "under assault" by regulators in the U.S. There’s been a lot of talk in some spheres about an alleged "Operation Choke Point 2.0." Do you think it’s real?

Mike Novogratz: Yes, 100%. I think it’s real. Think about Signature Bank, how they were so quickly shut down. Now, listen, we weren’t under the hood there. But when you look at Republic Bank and Signature Bank — Barney Frank, who’s on their board, was like "this is crazy, they were shutting it down." My friends in banking were like "there’s no reason that needed to be shut down." They could have done the same thing they did with Republic and the other banks, given them a lifeline. And so, that was because they’re associated with crypto, and maybe associated with Trump. That’s not the way our government is supposed to function. It just isn’t.

And we see it all the time now, the constant regulation through enforcement. The cost of that to the innocent players, because every time there’s an FTX, every single player in the ecosystem gets a subpoena for information about FTX. That costs a fortune. I look at our legal bills at Galaxy, and our audit bills, it’s 4x what they would be at a normal company. That’s a tax that Gensler and Co. are putting on our industry, trying to get the banks not to bank people. You know, that’s real. We’re smart enough, or lucky enough, to have a lot of banking sources, but lots of our portfolio companies we’ve been helping, and a lot of our peers even, to try to get banking … people just don’t want to bank crypto, and so you’re back to small banks that people haven’t heard of banking big institutions. It absolutely makes no sense. In the long run, the U.S. is going to lose. Hong Kong has got really progressive regulation, Abu Dhabi. So you’re just seeing people move out of the U.S. The frustration is that it’s not a big enough issue, that the broad political base cares.

TB: We’re here in Miami, at an international, Saudi-sponsored conference. We heard a speech from Mayor Francis Suarez, who’s been very pro-crypto in the past. Is a city like Miami, which has tried to position itself as a global hub, going to be restrained by the federal U.S. government, for example? 

Novogratz: The hope is that we have checks and balances in America, that we have a judiciary that for the most part is apolitical, not completely apolitical, for the most part. You’re going to see, when you read the Coinbase Wells notice, I’d take my chances that they’re going to win. When I read the Paxos Wells notice, I’d take my chances they’re going to win. They might not. But the SEC doesn’t have a real good case, and so I’m hoping that we have a firewall in our judiciary. The Republican House is very pro-crypto, just follow Tom Emmer. And so you’re not going to get bad legislation. It’s just this White House, and there’s no one really to stop them right now because they’ve got the debt ceiling to worry about. They’ve got the banking crisis to worry about.

It’s shocking. We’re so worried about crypto. Bank of America’s non-mark-to-market losses are bigger than the market cap of Bitcoin. Like we should be worried about other things, but you would think crypto is the only thing they worry about. You know, Gensler just asked for more money to have to go after the crypto bad actors. Like we’ve had AI exploding, we should be regulating AI and less on crypto.

TB: Do you see this becoming an issue in the upcoming presidential election at all?

Novogratz: I think it’ll become an issue in the elections. What the Democrats learned, and then seemed to forgot after Sam Bankman-Fried, was that there are 50 million Americans that own crypto and like it a lot. Of that 50 million, I would bet you 15 million are single-issue voters. Like "screw with my right to store my wealth how I want to, and I will fight you." And so pre-Sam, you saw a lot of Democrats coming around, and it was becoming bipartisan. And Sam made everyone look stupid. He made the industry look stupid. He made Democrats look stupid. Ironically, he almost gave as much to Republicans, quietly, but that’s not the story. The story is that he was the Democrat’s biggest donor. Politicians are politicians, and so they’re all running for the hills.

TB: We heard former Treasury Secretary Steven Mnuchin speak just a bit earlier about the U.S. dollar. Do you think a lot of the current administration’s actions are coming because they’re worried about the survival of the U.S. dollar (as a global reserve currency)?

Novogratz: There’s a little bit of that. Broadly, it just doesn’t register for enough people to care. And so Elizabeth Warren, for some bizarre reason, hates crypto, and she’s got a lot of sway in the financial side of the Biden administration. But for Yellen and Lael Brainard to be anti-crypto, that cuts something deeper.

When Balaji [Srinivasan] says we’re gonna go to a million (the price of bitcoin), I’m like, "Oh, God, don’t, don’t get what you wish for."  If we went to a million, that would be a loss of civil society in America. Like I don’t want us to go to a million real fast. I’d like us to go to a million over 5 or 10 years. Bitcoin is a report card on the stewardship of our finances, here and abroad. I always cheer for the U.S. to have good stewardship. It’s a really hard hand to play right now with the amount of debt we have, debt to GDP at 125%, with interest rates are 5%. But the math doesn’t work. And so we’ll inflate it away. And that’s why bitcoin is going to go up. But when you talk about hyperinflation, that scares policymakers, and then they see bitcoin as a threat. They don’t see gold as a threat, but it’s the same damn thing. And so I think the community needs to be a little careful about the hyperbole that everyone speaks with, because it definitely seems to be part of this anti-crypto.

TB: Speaking of the price of bitcoin, where is it going?

Novogratz: These are big weekly closes, monthly closes, quarterly closes. If you just look on the charts, now we’re at $25,000 to $40,000 range, heading higher. So like, we’re at roughly $29,000 as we speak. $35,000 is probably the next target. Are we going to go there in a straight line? Probably not. You’re going to need to see the economy slow. We’re going to have a credit crunch. The credit crunch isn’t gonna happen overnight. But if you think regional banks, which had credit growth of 15%, if that shrinks to 5%, that’s 2% of GDP. And so the Fed will be talking rate cuts in the fall. And once that happens, that’s that next leg for crypto.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Ripple Boss Urges Congress To Address SEC Chairman’s Latest Wild Assertions On Crypto

https://zycrypto.com/ripple-boss-urges-congress-to-address-sec-chairmans-latest-wild-assertions-on-crypto/

The chief executive of Ripple Labs, Brad Garlinghouse, has requested that U.S. lawmakers swiftly address recent comments made by SEC chair Gary Gensler, who indicated that rules for the crypto market already exist — and no new rules need to be written.

Garlinghouse Opposes SEC’s Unfair Crypto Regulation

Securities law has been a major point of contention for the crypto intelligentsia and unintelligentsia since Gary Gensler affirmed that most digital assets — but not the largest and oldest bitcoin — fall under the securities definition.

Gensler testified at the House Appropriations Subcommittee on Financial Services and General Government on March 29, maintaining that existing securities laws are adequate for effectively policing crypto markets. The direct quote was: “The regulations actually already exist. They’re called the securities regulation, and so there are disclosure regulations for when somebody tries to raise money from the public.”

The SEC has continued to pursue what industry pundits consider a “regulation by enforcement” approach when it comes to crypto assets, cracking down on firms and projects that drive what the regulator believes are unregistered securities.

In a Thursday tweet, Ripple CEO Brad Garlinghouse stated that such decisions should be based on legislation, instead of merely on Gensler’s personal stance. Garlinghouse explained that it’s “beyond comprehension” for the SEC boss to assert that he dictates what qualifies as securities instead of relying on legislation from which his commission derives its power.

Garlinghouse further accused Gensler of behaving like an autocrat, suggesting he will never want to provide clarity on cryptocurrencies. The chief of the blockchain firm, currently entangled in a $1.3 billion lawsuit with the SEC, added that “without clear jurisdiction, ambiguity masquerades as power.”

Gensler has claimed that the SEC is stretched thin and needs a whopping $2.4 billion in funding for the top U.S. securities regulator to crack down on “misconduct” in the cryptocurrency industry.

The SEC has already targeted some of the most recognizable crypto brands this year, including Gemini, Genesis, Kraken, and most recently Coinbase and Justin Sun. It is to be noted that the agency escalated its enforcement actions following the abrupt and shocking bankruptcy of crypto exchange FTX last November.

Meanwhile, crypto observers are anxiously waiting for a decision from a federal judge to settle the longstanding legal feud between the SEC and Ripple.

Gensler Cheers $2.4B Funding Proposal for SEC in Biden Budget

https://blockworks.co/news/gensler-funding-sec-biden-budget

SEC Chair Gary Gensler voiced his support of President Joe Biden’s request to fund his agency to the tune of $2.4 billion, claiming the funding would go a long way to taming the “wild west” of the crypto markets.

“I am pleased to support the President’s [financial year] 2024 request of $2.436 billion for the SEC, to put us on a better track for the future,” Gensler said during a House Financial Services subcommittee hearing.

Rapid technological innovation in the financial markets, particularly crypto, has led to misconduct in emerging areas, he added in his published remarks.

Critics argue the agency, under Gensler, has unfairly targeted the industry, which has led to a series of high-profile enforcement actions through litigation — most recently with crypto exchange Coinbase’s receipt of a Wells notice earlier this month. 

The regulator is alleging Coinbase violated US securities through its spot market, staking service, Coinbase Prime and Coinbase Wallet. Weeks prior, rival exchange Kraken agreed to settle with the SEC for $30 million over similar allegations, without admitting wrongdoing.

The funding, if approved by Congress, would allow the agency to double its headcount, allowing the division handling crypto affairs “to investigate misconduct on a larger scale.”

“Addressing this requires new tools, expertise and resources,” Gensler said. It would also speed up the pace of enforcement investigation through “resolutions.”

The SEC did not immediately respond to a request for comment.

“These additional resources would strengthen the division’s ability to protect American families by addressing risks in the crypto markets, cyber and information security, and the resiliency of critical market infrastructure,” he said.

Crypto is “rife with noncompliance,” Gensler added, seemingly ignoring Coinbase’s accusation it has attempted to engage with the regulator on multiple occasions for a clear path to registration. 

“Investors have put hard-earned assets at risk in a highly speculative asset class,” he said.


Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.

Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.

Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


Where Is The XRP Price Heading As Perp Open Interest Doubles?

https://www.newsbtc.com/analysis/xrp/where-is-xrp-price-heading-perp-open-interest-doubles/

The XRP price has been on an extremely strong rally over the past 11 days, rising more than 56%. The sudden awakening of the price from a months-long consolidation phase comes in light of rumors that a decision in the legal battle between Ripple Labs and the US Securities and Exchange Commission (SEC) could be imminent.

Even renowned trader Peter Brandt has published an analysis on the XRP price recently, although he doesn’t actually like the cryptocurrency, to put it nicely. However, Brandt has spotted an extremely rare chart pattern that could propel the price to $3, as NewsBTC reported.

Recent data from Kaiko, a leading source of cryptocurrency market intelligence, shows that futures traders are also getting bullish on the XRP price. Kaiko shared the chart below today and stated:

XRP perpetual futures open interest more than doubled this week on bets that a possible victory in Ripple’s lawsuit against the US SEC will trigger an alt season.

Crypto analyst Tara stated in her latest XRP tweet that she initially expects some consolidation following the strong rally. Using the ABC wave theory and Fibonacci retracement levels, she predicts that XRP will first fall towards $0.49 before new highs are possible.

XRP bounced off of our first buy target at $.529! I have the full ABC as shown below. We’re currently at Wave B ($.557). Wave C is now landing perfectly on the 382 fib which is our second buy target at $.494!

XRP price ABC pattern

A Damper For The XRP Price?

Whether a ruling will be made soon in the court case between Ripple and the SEC is pure speculation. XRP Community attorney John E. Deaton had expressed several times in recent weeks that he expects a ruling by the end of April. The basis for his assumption are the previous rulings of judge Analisa Torres.

However, a settlement between Ripple and the SEC seems far from reality at the moment, as Bill Morgan, another lawyer from the community noted today. Morgan is referring to a tweet from Ripple CEO Brad Garlinghouse, in which he again attacks the SEC harshly. Garlinghouse writes:

For the Chair of the SEC to assert that he dictates what is a security – and not the legislation from which his agency derives its power – is beyond comprehension. It’s time for elected officials in the US to take notice.

When you behave like an autocrat running a $2.2B bloated agency, why would you ever want to provide clarity about what’s “in or out”? Without clear jurisdiction, ambiguity masquerades as power. Read that again.

According to Morgan, the never-ending criticism of the SEC by various Ripple executives suggests that the company does not plan to settle with the regulator.

“I guess [Garlinghouse] and Stuart Alderoty hammering the SEC and Gensler in recent tweets means you are not about to sign a settlement agreement, in which case hammer away,” Morgan asserted.

Meanwhile, the XRP price was trading at $0.5316 at press time, trying to hold the first support around $0.53. If this breaks, the most crucial support will be at $0.49.

In the short term, today’s release of the PCE in the US (8:30 am EST) could decide the direction of the next movement of the price. However, in the medium term, the outcome of the litigation and expectations about it are likely to be the main price drivers in April.

XRP price

Binance and CZ Sued by CFTC Over Regulatory Violations

https://www.youtube.com/watch?v=82V2AzayQP0

Bankless Weekly Rollup
Last Week of March 2023

——
📣 Infura | New SDK for NFT APIs For Devs
https://bankless.cc/Infura

——
🚀 JOIN BANKLESS PREMIUM:
https://www.bankless.com/dashboard

——
BANKLESS SPONSOR TOOLS:

⚖️ ARBITRUM | SCALING ETHEREUM
https://bankless.cc/Arbitrum

🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE
https://bankless.cc/kraken

🦄UNISWAP | ON-CHAIN MARKETPLACE
https://bankless.cc/uniswap

👻 PHANTOM | FRIENDLY MULTICHAIN WALLET
https://bankless.cc/phantom-waitlist

🦊METAMASK LEARN | HELPFUL WEB3 RESOURCE
https://bankless.cc/MetaMask

🚁 EARNIFI | CLAIM YOUR UNCLAIMED AIRDROPS
https://bankless.cc/earnifi

——
Topics Covered

0:00 Intro

3:56 Markets
5:49 2/3 of QT reversed


17:41 Staking tokens up – April 12 is the date
https://decrypt.co/124812/ethereum-staking-tokens-shanghai-upgrade-gets-date
19:14 Arbitrum
https://l2beat.com/scaling/projects/arbitrum


21:00 How much ETH is lost forever?

26:50 Binance gets busted
https://www.cftc.gov/PressRoom/PressReleases/8680-23


https://www.binance.com/en/blog/from-cz/czs-response-to-the-cftc-complaint-2408916493005890282

35:18 War on Crypto continues
https://www.whitehouse.gov/wp-content/uploads/2023/03/ERP-2023.pdf

43:20 Crypto has its defenders even outside of crypto!


https://www.bankless.com/congressman-tom-emmer-tackles-the-war-on-crypto
https://decrypt.co/124872/sec-gensler-insists-clear-rules-crypto-already-exist

57:38 ETH
57:45 Polygon ZkEVM launched


59:48 Consensys launched their zk-rollup Linea


1:00:18 L2Beat introduced Risk Rosette

1:02:39 Euler
https://etherscan.io/tx/0xf69c53b82273764989cdecf75b6daabb0c0bd30b4e659bca080948126c1f992c
https://etherscan.io/tx/0xf69c53b82273764989cdecf75b6daabb0c0bd30b4e659bca080948126c1f992c

1:05:39 MakerDAO

1:07:18 NFTs
Ticketmaster debuts NFT-gated ticket sales

Ticketmaster Launches Token-Gated Sales, Enabling Artists to Reward Fans with Prioritized Ticket Access and Concert Experiences Through NFTs

1:09:56 Microstrategy
https://www.coindesk.com/business/2023/03/27/microstrategy-pays-off-silvergate-loan-buys-more-bitcoin/

1:11:07 Nasdaq to launch crypto custody service in Q2

1:11:40 Avalanche C chain out of order for +50 minutes


1:12:27 U.S. charged SBF from bribing China
https://www.reuters.com/legal/ftxs-bankman-fried-charged-with-bribery-conspiracy-new-indictment-2023-03-28/
1:13:05 Pause on training AI

Pause Giant AI Experiments: An Open Letter

1:16:44 Dune Integrates Chat GPT4!


1:18:48 MetaMask is integrating SiwE natively!


1:21:00 Kraken partnership with Williams Racing


1:22:33 Conduit

1:23:33 Jobs
https://bankless.pallet.com/jobs/f39528ec-e381-4c1f-a9ad-907e69ac27bf

1:27:06 Questions from the Nation
Bigwiggle501
Goggart
RocketPoolster

1:34:18 Takes

1:43:55 What David’s Bullish On
1:46:00 What Ryan’s Bullish On

1:48:25 MEME of the Week

1:49:44 Risks & Disclaimers

—-
Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research.

Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here:
https://www.bankless.com/disclosures

Ripple CEO Calls Out SEC Chair Gensler Over Legislation Comment

https://coinedition.com/ripple-ceo-calls-out-sec-chair-gensler-over-legislation-comment/

  • Brad Garlinghouse has called out SEC Chair Gary Gensler for saying that crypto legislation is unnecessary.
  • The Ripple CEO likened Gensler to an autocrat running a billion-dollar boated agency.
  • Garlinghouse emphasized the need for clear jurisdiction, regulation, and legislation.

Ripple CEO Brad Garlinghouse has voiced his disappointment with the recent comments made by Gary Gensler, the Chairman of the United States Securities and Exchange Commission (SEC). Garlinghouse took to Twitter earlier today and called on lawmakers in the United States to take notice and address legislation for the crypto industry.

Brad Garlinghouse’s tweet was in response to the comments made by Gensler after a House Appropriations Committee hearing earlier this week. The SEC chair told reporters that there was no need for additional laws for crypto and that existing securities laws were …

The post Ripple CEO Calls Out SEC Chair Gensler Over Legislation Comment appeared first on Coin Edition.

Assessing if Hedera’s U.S. presentation can wind down crypto regulatory heat

https://ambcrypto.com/assessing-if-hederas-u-s-presentation-can-wind-down-crypto-regulatory-heat/

  • The Hedera Hashgraph team spoke to the U.S. delegation about the blockchain ecosystem.
  • Clampdown on the ecosystem remains constant but the HBAR’s price increased.

Hedera [HBAR], the decentralized enterprise-grade public network got an opportunity to discuss the idea behind its project at a U.S. Department of state meeting.

The event, which covered private sector discussions, offered Hedera the chance to explain how decentralized projects help some of the country’s objectives.


Realistic or not, here’s HBAR’s market cap in BTC terms


A dive into the world of the untamed 

Created by Hedera Hashgraph LLC, a cryptography firm in the United States, the Hedera public network facilitates the use of smart contracts to validate transactions and reduce data manipulation.

This, and details about the usability of the Distributed Ledger Technology (DLT) were the talking point shared by the project.

However, it is necessary to point out that the address does not immediately translate to the country’s slowdown on the crypto clampdown.

For some time, the United States, led by its Securities and Exchange Commission (SEC) has shown disdain toward crypto firms, and several existing tokens.

This same conflicting position has driven the case with Ripple [XRP] to escape resolution for over two years. World’s largest exchange Binance has not been left out. And Ethereum [ETH], a token that has existed for eight years has been tagged security by the Gary Gensler-led administration.

Therefore, it is highly unlikely that the solution Hedera has extended would quench the year-long hunt. In fact, it has worsened to the point that the SEC Chairman requested more funds to continue its “oversight”.

In his testimony before the U.S. Financial Services Committee, Gensler had asked for $2.43 billion to further the commission’s activities in 2024.

Although his statement largely avoided a direct attack on crypto, he was not unable to label the ecosystem as “non-compliant.”

HBAR rises

However, the broader market seemed unperturbed by Gensler’s gimmicks. On 29 March, Bitcoin [BTC] momentarily tapped $29,000. However, the coin has been able to sustain its value above $28,000 ever since.


Is your portfolio green? Check the Hedera Profit Calculator


Hedera’s involvement with the authorities was surely not expected to affect its growth. But the token has been able to upturn its initial seven-day deficit. At press time, HBAR exchanged hands at $0.064, bringing its 24-hour performance to a 3.38% uptick.

According to CoinMarketCap, the trading volume within the same period increased by 164%. The volume measures the aggregate amount of transitions that occurred within a network.

Hence, the hike simply means that an increased number of HBAR tokens have been bought and sold irrespective of gains made or losses incurred.

La SEC a besoin de 2,4 milliards de dollars pour attaquer Bitcoin et les cryptomonnaies

https://journalducoin.com/economie/gary-gensler-besoin-24-milliards-dollars-attaquer-cryptos/

Un Far West à règlementer – Dire que la Securities and Exchange Commission (SEC) a déclaré la guerre au secteur de la crypto est à peine exagéré. Kraken, Coinbase, Binance, Ripple ou encore la plateforme de DeFi SushiSwap en ont fait les frais, ou sont toujours en procédure avec le régulateur américain. Aujourd’hui, le responsable de la SEC, Gary Gensler demande encore plus d’argent à la Chambre des Représentants pour mener à bien son assainissement à marche forcée du secteur. Direction le Capitole, à Washington, pour faire le point sur les dernières déclarations du régulateur en chef.

2,4 milliards pour embaucher 170 personnes supplémentaires à la SEC

Le 29 mars dernier, Gary Gensler a témoigné devant le sous-comité des Crédits de la Chambre des États-Unis afin de préparer l’audience devant le Comité principal sur les crédits. Ce Comité est un des plus puissants de la démocratie américaine, car c’est lui qui est responsable de l’adoption des projets de loi sur le budget avec son homologue du Sénat. Le responsable de la SEC est venu plaider en faveur d’une augmentation du budget de son institution en écho aux propos du président Biden qui l’avait déjà évoqué quelques jours plus tôt.

Cette hausse, indispensable selon M. Gensler, servira à suivre le rythme de l’innovation, comme il l’a déclaré devant les parlementaires :

« L’innovation technologique rapide sur les marchés financiers a conduit à des erreurs dans des domaines émergents et nouveaux, notamment dans l’espace de la cryptomonnaie. Pour y remédier, il faut de nouveaux outils, de l’expertise et des ressources. »

La SEC veut plus de budgets pour mieux lutter contre les acteurs malveillants de la crypto

>> Rentrez en avant-première sur des projets prometteurs sur AscendEX (lien commercial) <<

Le secteur de la crypto est un Far West à règlementer selon M. Gensler

Pour mener à bien les missions qui sont les siennes, la SEC aurait notamment besoin d’embaucher près de 170 personnes supplémentaires. Pour cela, il a donc besoin de 2,4 milliards de dollars. Gary Gensler a rappelé que malgré la hausse du budget l’année dernière, l’agence était toujours à bout de souffle. Mais surtout qu’elle avait besoin de sang neuf :

« Comme c’est nous les policiers sur le terrain, nous devons avoir les moyens d’affronter les criminels. Ainsi, il serait normal que les services de la SEC se développent en même temps que ce secteur grandit et se complexifie. »

Car pour lui, clairement, le secteur de la crypto est un Far West qui a besoin d’un shérif ! Le manque de conformité règne dans le milieu et met en danger l’argent durement gagné par les investisseurs. En effet, l’agence a reçu des dizaines de milliers de plaintes en 2022 qui ont donné lieu à plus de 750 actions de la part de la SEC.

L’augmentation du budget n’est pas gagnée, car elle doit maintenant être votée par les différentes chambres avant d’être adoptée. Or, le responsable de la SEC compte quelques détracteurs parmi les représentants du peuple, entre ceux qui trouvent qu’il en fait trop avec le jeune secteur de la crypto et ceux qui trouvent qu’il n’en a pas fait assez avec FTX. Pendant ce temps-là, en France, le régulateur semble aussi parti en croisade contre le secteur de la crypto.

Malgré les exigences de la régulation, votre conviction pour Bitcoin est inébranlable ! Vous voulez ajouter quelques satoshis gratuits dans votre wallet ? Foncez vous inscrire sur AscendEX. Profitez de 10 % de réduction sur les frais de trading (lien commercial, voir conditions sur site).

L’article La SEC a besoin de 2,4 milliards de dollars pour attaquer Bitcoin et les cryptomonnaies est apparu en premier sur Journal du Coin.

SEC Chair Gary Gensler’s latest call signals tough times ahead for crypto players

https://www.fxstreet.com/cryptocurrencies/news/sec-chair-gary-genslers-latest-call-signals-tough-times-ahead-for-crypto-players-202303310121

Share:

  • Gary Gensler has said the SEC needs new tools, expertise, and resources to regulate the crypto industry.
  • The US SEC chair notes the regulatory muscle will help expedite enforcement, investigations, and resolution.
  • He was speaking during a Congressional hearing on budget request and crypto regulation.

US Securities and Exchange Commission (SEC) chair, Gary Gensler, has hinted at tough times ahead for crypto players. In his testimony before the House Appropriations Subcommittee on Financial Service and General Government, Gensler advocated for additional infrastructure, calling for new tools, expertise and resources to fight misconduct in the crypto arena.

We’ve seen the Wild West of the crypto markets, rife with noncompliance, where investors have put hard-earned assets at risk in a highly speculative asset class,

SEC chair calls crypto market the ‘Wild Wild West’

Gensler was testifying on the SEC’s Fiscal Year (FY) 2024 budget request. An excerpt from his testimony reads:

I am pleased to support the President’s FY 2024 request of $2.436 billion for the SEC, to put us on a better track for the future,” Gensler began. “The FY 2024 request seeks funding for an additional 170 positions, as well as full-year funding for those staff hired in FY 2023.

Shifting attention from the budget, Gensler told the committee that the crypto market has become the “Wild Wild West” soiled with a lot of non-compliance as investors put their hard-earned assets at risk in a highly speculative asset class. In his opinion, rapid technological innovation within the financial market scene has paved way for misconduct in emerging and new areas beyond the crypto arena.

Capacity building in the agency

Accordingly, the SEC proposed the ideal remedy would be capacity building, which means the introduction of “new tools, expertise, and resources.”

Gensler also specified that part of these infrastructures would be additional staff, who would help the agency’s Enforcement Division.

With more capacity to meet these challenges, investigate misconduct on a larger scale, and accelerate the pace of enforcement investigations to resolution.

He disclosed that the agency received over 35,000 tips and complaints in FY 2022. Despite limited resources, the SEC’s Enforcement Division was able to bring to book over 750 enforcement actions in Fiscal Year 2022. Notably, this was a 9% increase from the previous fiscal year.

Our actions resulted in orders for $6.4 billion in penalties and disgorgement.

The SEC, led by Gensler, has increased its activity in the crypto arena, with the most recent action being a ‘Wells notice’ sent to Coinbase calling out the US-based exchange for potential violations of securities law. 

The agency also went after Tron founder, Justin Sun, on charges of market manipulation and offering unregistered securities. Others who have been caught in the SEC’s crosshairs include crypto exchange Kraken and BUSD stablecoin issuer, Paxos. Meanwhile, Gensler affirms that every cryptocurrency token, apart from Bitcoin, is a security.

SOTM March 23-29, 2023

https://5264302.fs1.hubspotusercontent-na1.net/hubfs/5264302/State%20of%20the%20Market%20-%20March%2023%20-%2029%2C%202023.pdf#new_tab

The SEC stole the show for weeks, but the CFTC just fired the biggest shot yet in the crusade to cull crypto. In a 74-page complaint issued Monday, the U.S. commodities regulator sued digital asset behemoth Binance over a lack of compliance controls. The suit accuses the exchange of turning a blind eye to illegal activity, quoting internal conversations in which executives acknowledged many users (including terrorist group Hamas) were “here for crime.” The CFTC’s filing personally implicates CEO Changpeng “CZ” Zhao, asserting he “answers to no one but himself.” Interestingly, the suit also claims that several assets— BTC, LTC, ETH, USDT, and BUSD— are commodities, contradicting statements from SEC Chair Gensler & NY Attorney General Letitia James on ETH’s potential status as an unregistered security. Shortly before the CFTC announcement, Binance ended their 0- fee trading program, triggering a drop in volume & liquidity across the exchange’s major trading pairs. Meanwhile, CZ’s former rival Sam BankmanFried continues to earn ire from the U.S. government, with prosecutors unveiling a ‘superseding indictment’ alleging SBF attempted to bribe Chinese officials with “approximately $40 million” in crypto. Also joining the government custody club is Terraform Labs founder Do Kwon, arrested in Montenegro while traveling under a false name. In addition to Kwon’s arrest warrant from South Korea, the U.S. announced their own indictment on Thursday, charging Kwon with various forms of fraud over a lack of disclosures around the LUNA & TerraUSD tokens. While many regulators are engaged in a cryptocurrency crackdown, Hong Kong has made a surprising pivot in their attitude towards the industry. Despite the ban on crypto transactions in mainland China, HK-based banks were reportedly approved to solicit business from the sector (though authorities in Beijing maintain hardline stances on strict KYC/AML requirements). The policy shift has lured many crypto firms back to the region, including crypto exchange OKX, once headquartered in Beijing before China’s crypto ban forced a relocation to the Seychelles. U.S. exchanges are also eyeing overseas opportunities, with Coinbase & Gemini announcing plans to set up derivatives platforms outside of the U.S. in an attempt to fill gaps left by FTX. Though perpetual futures have historically been the primary derivative of choice, BTC options recently flipped futures in terms of open interest, with the value of outstanding contracts on Deribit & CME near-doubling since the beginning of March. The uptick in CME options is especially indicative of renewed appetite from traditional institutions. NASDAQ claims the same, with the exchange’s leadership projecting a Q2 launch of their digital asset custody service. Even as regulatory bodies slam crypto with increasingly contradictory enforcement actions, TradFi giants move towards digital assets with heightened clarity, scooping up picks & shovels left behind in the 2021 gold rush wreckage.

Brought to you by coinmetrics.io

The post SOTM March 23-29, 2023 appeared first on Coin Metrics.

Kraken Amends Canada Registration as SEC Sharpens Knives With $2.4 Billion Funding

https://beincrypto.com/kraken-amends-canada-registration-sec-2-4-b-funding/

Crypto exchange Kraken has filed a pre-registration undertaking (PRU) with the Ontario Securities Commission to provide more investor protection.

The new registration would see the exchange become a Restricted Dealer throughout Canada. It follows a revised investor protection guidance issued by the Canadian Securities Administrators.

Kraken Takes on Challenge for Greater Investor Protection

“The PRU will help maintain the integrity of our operations and help all Canadians gain financial freedom through crypto,” Kraken said in a blog post.

Currently, Kraken offers Canadians CAD spot trading pairs and employs 250 Canadians.

The CSA introduced enhanced investor protection in Feb. 2023. Under the new regime, a PRU includes improved custody and separation of customer funds. Exchanges cannot offer Canadian investors margin or leveraged trading nor allow them to buy or deposit stablecoins.

Following the amended regulations, several Kraken competitors, such as OKX, Blockchain.com, and Deribit, exited Canada.

Recently, Kraken agreed to pay the U.S. Securities and Exchange Commission $30 million to settle allegations that the exchange offered its staking product as an unregistered security to U.S. customers. It subsequently ceased offering its crypto asset staking product to U.S. customers.

SEC Will Use $2.4 Billion to Strengthen Enforcement Team

Crypto industry players in the U.S., including Coinbase Chief Legal Officer Paul Grewal, have criticized the SEC for regulating by enforcement actions rather than providing rules

The SEC drafts rules based on existing U.S. securities laws. So far, it has not defined which crypto assets or transactions constitute a security. SEC Chairman Gary Gensler has said that existing securities laws, such as the Securities Act of 1933 and the Securities Exchange Act of 1934, provide enough guidance.

In addition to the lawsuit against Kraken, the SEC has served Coinbase with a Wells Notice. In the notice, the SEC alleged that certain crypto assets Coinbase lists are securities. The agency served stablecoin issuer Paxos with a notice last month, alleging that its BUSD stablecoin constitutes an unregistered security.

U.S. President Joe Biden recently requested $2.4 billion to be allocated to the SEC in a move that may bode ill for the crypto industry.

In a prepared testimony on March 29, 2023, Gensler affirmed that the funding could help the SEC hire additional enforcement staff and to help limit bad behavior in the crypto industry. He said that most of the crypto industry was still a wild west, which prompted the SEC to issue 36% more enforcement actions in 2022 than in 2021.

Gary Gensler is scheduled to appear before the House Financial Services digital assets subcommittee on April 18, 2023. He will be asked to clarify his approach to rulemaking and digital assets here.

In other securities news, the Thai securities exchange recently confirmed it would remove limits for retail investors buying tokens in initial coin offerings.

For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here.

The post Kraken Amends Canada Registration as SEC Sharpens Knives With $2.4 Billion Funding appeared first on BeInCrypto.

Crypto collapse: New Sam Bankman-Fried charge, Binance fallout, SEC sues exchange over crypto securities, how Signature died

https://amycastor.com/2023/03/30/crypto-collapse-new-sam-bankman-fried-charge-binance-fallout-sec-sues-exchange-over-crypto-securities-how-signature-died/

  • By Amy Castor and David Gerard

“who needs an examiner when you can just hand sam an empty sheet of paper and wait”

— haveblue

Sam is a growing boy, he needs his crimes

A new superseding indictment against FTX founder Sam Bankman-Fried alleges that he paid Chinese officials $40 million in crypto in a bribe to unfreeze $1 billion in crypto on Alameda — which would violate the Foreign Corrupt Practices Act. Sam now faces 13 criminal counts. [Superseding indictment, PDF]

On Thursday, March 30, Sam took a trip to New York and pleaded not guilty to his latest five charges. He had to battle his way through a gaggle of reporters just to get in the door. At least it got him out of the house. [Twitter; YouTube; NYT]

In early 2021, China froze various Alameda accounts on two of the country’s biggest crypto exchanges (which aren’t named in the indictment). Bankman-Fried “understood that the Accounts had been frozen as part of an ongoing investigation of a particular Alameda trading counterparty.” A bribe was sent from Alameda to a private blockchain address in November 2021. The accounts were unfrozen shortly after, and Alameda got its cryptos back.

Somehow, Daniel Friedberg, FTX’s chief counsel at the time knew nothing of this. Friedberg said in an affidavit dated March 19, 2021, when the FTX Arena naming rights deal was going through, that FTX and its affiliated companies “do not have any ownership or contracts or any other obligations with respect to any governmental agency of the People’s Republic of China, or any governmental agents or political persons.” [Miami-Dade Legislative Item, PDF, p. 54]

Sam will be kept on a very short leash while he’s out on bail. Sam gets a non-smartphone that only does voice and SMS — no internet access — and a locked-down laptop configured to access only certain websites. He can work with his lawyers, order food from DoorDash, and keep up with the sportsball. YouTube is also on the list, so we’re looking forward to the 10-hour video blogs detailing crimes hitherto unknown to humanity. [Order, PDF]

Sam’s father, Joseph Bankman, is paying his son’s lawyer fees with over $10 million that Sam borrowed from Alameda and gave to his father as a present in 2021. We wonder if John Jay Ray is going to come calling to claw this back for the bankruptcy estate. [Forbes]

In the FTX bankruptcy, a group of ad-hoc FTX creditors with $2 billion in claims want to participate in the bankruptcy without revealing their identities. They include “large institutional market makers and asset managers.” This is the precise sort of creditor that the Bankruptcy Act is not intended to protect from public scrutiny. [Doc 1137, PDF]

FTX appears to have been hiding money under the names of employees. The OKX exchange, formerly OKex, has agreed to turn over $157 million in FTX funds. $150 million of that was in an account of David Ratiney, a former FTX employee. Ratiney says the account was opened on behalf of Alameda. He has agreed to forfeit the assets. [Doc 1189, PDF; Doc 1190, PDF]

Binance: This is fine

The CFTC lawsuit against Binance, which we covered in detail on Tuesday, has rattled customers. Within days, the exchange saw outflows of $2 billion, out of a claimed reserve of $63.2 billion, according to Nansen. Currently, 28% of Binance reserves are in Tether and 10% are in BUSD. [WSJ, paywalled; Nansen]

The three large US hedge funds trading on Binance weren’t named in the CFTC complaint — though Radix Trading later came forward and said that they were “Trading Firm A.” Radix insists they did nothing wrong — they ran all their apparent conspiracy to violate commodities laws past their in-house legal team, after all. [WSJ, paywalled]

But the CFTC complaint has “already sent chills” across the commodity trading industry — particularly firms who make their money from real commodity trading and only dabble in the toxic waste barrel of crypto. Market makers are wondering if they’re risking their own broker-dealer licenses. [Bloomberg]

Cash withdrawals from Binance US are no longer working via ACH through Signature. Binance says: “ACH deposits and withdrawals for a small subset of our users were disrupted last week and, out of an abundance of caution, remain paused. Our teams are working through this transition and expect to restore functionality within the next 24 hours.” It’s probably fine. Your funds are safe. [Reddit]

You’ll be shocked to hear that Binance kept substantial business links to China for years after its claimed 2017 exit, despite Binance executives repeatedly saying otherwise. [FT]

The Block reported in 2019 that Binance had offices in Shanghai. CZ hit the roof and threatened to sue them, with the explicit aim of outspending them on lawyers … and The Block stood by its story. (Ben Munster, then of Decrypt, helped with the response story, though The Block took out Ben’s harsher additions.) [The Block, 2019; Twitter, archive; Twitter, archive; The Block, 2019]

The sale of Voyager Digital to Binance US is on hold. The Department of Justice and the US Trustee appealed the sale on the basis that the order granted inappropriate immunity from prosecution, and asked for a stay. This appeal has been upheld. [Doc 1222, PDF; Doc 1223, PDF; Bloomberg]

Be your own Signature Bank

In his statement on the recent bank failures and the federal regulatory response, FDIC Chairman Martin Greunberg explained why Signature failed: the bank was insolvent. [FDIC, PDF]

On March 10, Signature Bank lost 20 percent of its total deposits in a matter of hours, depleting its cash position and leaving it with a negative balance with the Federal Reserve as of close of business. Bank management could not provide accurate data regarding the amount of the deficit, and resolution of the negative balance required a prolonged joint effort among Signature Bank, regulators, and the Federal Home Loan Bank of New York to pledge collateral and obtain the necessary funding from the Federal Reserve’s Discount Window to cover the negative outflows. This was accomplished with minutes to spare before the Federal Reserve’s wire room closed. 

Over the weekend, liquidity risk at the bank rose to a critical level as withdrawal requests mounted, along with uncertainties about meeting those requests, and potentially others in light of the high level of uninsured deposits, raised doubts about the bank’s continued viability. 

Ultimately, on Sunday, March 12, the NYSDFS closed Signature Bank and appointed the FDIC as receiver within 48 hours of SVB’s failure.

The FDIC has told crypto clients with deposits at Signature Bank that they have until April 5 to close their accounts and move their money. The FDIC is looking to sell off Signature’s Signet inter-crypto-exchange dark liquidity pool. [Bloomberg]

Frances Coppola explains precisely what happened at Signature. [Coppola Comment]

We noted previously how larger US banks don’t want to go within a mile of crypto. But some smaller banks are still feeling lucky. [WSJ, paywall]

The SEC shuts down Beaxy

The Beaxy crypto exchange shuttered after the SEC filed charges against it for failing to register as a national securities exchange, broker, and clearing agency, and over its 2018 ICO. The SEC also charged a market maker operating on Beaxy as an unregistered dealer. [SEC press release; complaint, PDF; Coindesk]

Beaxy ran a “private sale” ICO for its internal exchange token BXY from May 2018 to June 2019. The SEC is charging Beaxy and its founder Artak Hamazaspyan over the ICO as an unregistered offering of securities to US retail.

That’s the sort of complaint we’re used to seeing from the SEC — but they’re also charging Windy Inc., who ran the Beaxy platform, and Windy’s founders, Nicholas Murphy and Randolph Abbott, over unregistered securities trading on the exchange.

If cryptos being traded are securities — and it’s likely that most are — that leaves even the normal activities of an exchange subject to a vast array of additional regulations.

The SEC is also charging Brian Peterson and Braverock Investments as unregistered dealers for market-making on Beaxy for the BXY and Dragonchain DRGN tokens. The SEC sued Dragonchain in August 2022, alleging that DRGN was an unregistered offering of securities; that case is proceeding. [SEC, 2022; case docket]

Hamazaspyan is also alleged to have misappropriated $900,000 from the ICO for his own use. Murphy and Abbott discovered this in October 2019 and convinced Hamazaspyan to pay back $420,000 to Beaxy and let Windy run Beaxy going forward.

Windy, Murphy, Abbott, Peterson, and Braverock settled, paying a total penalty between them of $228,579. The SEC case against Beaxy and Hamazaspyan over the ICO is proceeding.

Beaxy shut down on Tuesday, March 28, owing to “the uncertain regulatory environment surrounding our business.” We think it’s deadly certain. [Beaxy, archive]

This is the first SEC action over securities trading on an exchange. It’s a likely template for future SEC cases against other crypto exchanges — like, say, Coinbase.

The Coinbase employee convicted in a criminal case of wire fraud by insider trading is fighting an SEC civil case claiming that the insider-traded tokens were securities. [WSJ]

SEC chair Gary Gensler will be testifying before Congress on April 18. The very non-partisan committee announces that “Republicans will hold @GaryGensler accountable for his flagrant disregard for the law, jurisdiction, and the APA.” (The Administrative Procedure Act.) We hope the Blockchain Eight show up. [Twitter]

More good news for decentralization

A court in California has denied the motion to dismiss of members of the bZx DAO who held governance tokens (BZRX), finding the DAO is plausibly alleged to be a general partnership. [Order, PDF; CoinDesk]

One of the earliest objections to the original DAO in 2016 was that it would be a general partnership, leaving everyone involved jointly and severally liable. (This is why incorporation is a thing.) The same problem was frequently noted in the rise in DAOs in the recent crypto bubble. Nobody involved can claim they had no idea.

Regulatory clarity, European style

The European Banking Authority has a new consultation paper on anti-money laundering (AML) risk factors that national bank regulators should consider. Crypto-asset providers are listed as an area that regulators should examine closely, including if “Distributed Ledger Technology” is “essential to the sector’s business model and operation” or “where services of the subject of assessment are provided using DLT or blockchain technology.” Comments are due by June 29, 2023. [EBA, PDF]

Coming soon in European AML: no anonymous crypto payments in the EU of over 1,000 EUR. Crypto asset managers will be required to verify “their customers’ identity, what they own and who controls the company.” [EP]

Terra-Luna

After he was arrested last week, Do Kwon of Terraform Labs is serving time in a Montenegrin prison. Kwon is likely to stay in jail there for at least a year, while his appeals and extradition hearings proceed. We expect he’ll be sent to South Korea first, and only then to the US. [YNA, in Korean; Protos

South Korean prosecutors are making another effort to arrest Terraform Labs cofounder Daniel Shin, who left the company in March 2020. [Bloomberg]

MicroStrategy doubles down 

As part of winding the bank down, Silvergate struck a deal with MicroStrategy to accept $161 million to repay a $205 million bitcoin-backed loan — taking a $44 million loss. Silvergate had said repeatedly that its bitcoin-backed loans were safe. [WSJ]

MicroStrategy sold 1.35 million shares of MSTR in Q1 2023, diluting shareholders by over 10% to pay off its Silvergate loan — and bought $150 million more BTC between February 16 and March 23. This is a Hail Mary pass praying for number to go up, which it is quite unlikely to do. [8-K; Twitter]

More good news for bitcoin

Hindenburg Research’s latest short-seller report is on Jack Dorsey’s Block, formerly Square. Cash App’s growth is aimed at targeting the “unbanked” — which mostly means embracing noncompliance to grow its user base. A Cash App employee told Hindenburg, “every criminal has a Square Cash App account.” And this is before Block has even got into crypto in any substantial way. [Hindenburg]

Indicted crypto promoter Guo Wengui used his culture-war social network Gettr to pump cryptos. Wengui was fined a billion dollars by the SEC in 2021 over his crypto offerings. [Washington Post]

The British Virgin Islands has ordered Three Arrows Capital founders Zu Shu and Kyle Davies to attend an examination on May 22 or be in contempt of court. We’re sure they’ll be right on that. [CoinDesk]

Freeing yourself from fiat history

If you click on a lot of old links to theblockcrypto.com, it’ll tell you that The Block has “sunset our News+ product” — their previous paywalled news offering. They didn’t open up those old pages — they’ve just effectively deleted a whole swathe of their journalism from 2018 to 2020!

We discovered this when Amy went looking for one of her old Block pieces on Binance for our article on Tuesday and when David looked for various other Block articles for today’s story.

You’d think a publisher wouldn’t just trash their own search optimization — but in practice, both mainstream and specialist publications destroy their own URLs and content all the time. So it’s pretty likely this was an error. Hopefully a reversible one.

We remember when Decrypt moved their domain from decryptmedia.com to decrypt.co. They saw their Google hits go through the floor and thought they’d been shadowbanned … not realizing they’d done it to themselves. The Block changed its URL around the same time, with similar effects.In the meantime: ARCHIVE EVERYTHING. Stuff that’s blocked from the Internet Archive saves just fine into archive.is, and archive.is also accepts pages from the Internet Archive, Google cache, and Bing cache and indexes them correctly under the source URL. David uses and recommends the Get Archive extension for Firefox. [Mozilla Add-Ons]

Matt Damon Reveals Why He Starred in THAT Crypto.com Advert [ Crypto Espresso 3.30.23 ]

https://www.youtube.com/watch?v=bcHsuYEdQ2M

• For more information about crypto and today’s stories, just Ask Alex: https://CoinMarketCap.com/Alexandria/

🔵 CoinMarketCap Daily:

• Clear Rules for Crypto Industry Already Exist, SEC’s Gary Gensler Claims

The SEC’s chairman claims the crypto industry is rife with non-compliance — and he’s asking for another $200 million to chase bad actors.

https://coinmarketcap.com/alexandria/article/clear-rules-for-crypto-industry-already-exist-sec’s-gary-gensler-claims

• Paxful Fully Compensating All of Its Users Who Were Affected By Celsius Going Bust

The peer-to-peer platform ran Paxful Earn through the doomed crypto lender — and when withdrawals were frozen, its users were also locked out of their funds.

https://coinmarketcap.com/alexandria/article/paxful-fully-compensating-all-of-its-users-who-were-affected-by-celsius-going-bust

• Pussy Riot Member Put on Russia’s Most-Wanted List, with NFT Used as Evidence

The feminist punk rocker had created a work called “Virgin Mary, Please Become a Feminist” — but this is an offense under Russian law because it “hurts religious feelings.”

https://coinmarketcap.com/alexandria/article/pussy-riot-member-put-on-russia’s-most-wanted-list-with-nft-used-as-evidence

• ‘Fortune Favors the Brave’: Matt Damon Reveals Why He Starred in THAT Crypto.com Advert

The actor explained that he was trying to raise money for his charity Water.org — and when the exchange heard about this, it also donated $1 million.

https://coinmarketcap.com/alexandria/article/’fortune-favors-the-brave’:-matt-damon-reveals-why-he-starred-in-crypto.com-advert

🔔 From crypto news, to market moves, and to educational how to videos. If you want something more than just hype and to actually learn about crypto, make sure to hit the subscribe button right now and turn on notifications to not miss out on new videos!

🔵 Coin Market Cap is the world’s most-referenced price-tracking website for cryptoassets in the rapidly growing cryptocurrency space. Its mission is to make crypto accessible all around the world through data and content.

📲 Download our app!
IOS : https://apple.co/3dOkokH
Android : https://bit.ly/3gHyJkS

🤝 Join CoinMarketCap!
https://bit.ly/3dVaEoS

Follow CoinMarketCap on social!

https://www.facebook.com/CoinMarketCap
https://www.instagram.com/CoinMarketCap
https://reddit.com/r/CoinMarketCap
https://t.me/CoinMarketCap

📩 Subscribe to our Newsletter!
https://coinmarketcap.com/newsletter/

Crypto Crackdown: SEC Chair Backs $2.4B Funding Boost To Modernize Rules

https://www.tronweekly.com/crypto-crackdown-sec-chair-backs-2-4b-funding/

The United States Securities and Exchange Commission (SEC) Chair, Gary Gensler, has backed President Joe Biden’s call for the regulator to receive a record-breaking $2.4 billion in funding to crack down on misconduct in the cryptocurrency industry. 

SEC’s Role in Protecting Public & Modernizing Rules For Crypto Markets

Gensler emphasized the need to modernize SEC rules to keep pace with technological advancements in today’s $100 trillion capital markets. In prepared testimony for the March 29 budget hearing with the House Appropriations Committee, he noted that the growth and rapid changes in the markets increased the possibility of misconduct and noncompliance. 

Gensler pointed out that the recent market volatility also highlighted the SEC’s need to be adequately resourced. The SEC oversees entities ranging from start-ups to multinational corporations and markets, including broker-dealers, stock exchanges, clearinghouses, mutual funds, and asset managers. 

Gensler explained that the SEC’s work to oversee federal securities laws played a vital role in America’s economic success and geopolitical standing around the globe for 90 years. The SEC’s clients include the 330 million Americans who invest in their 401(k)s and IRAs, trade through brokerage apps or use robo-advisers.

Gensler praised the SEC’s dedicated staff and their remarkable work with limited resources. However, he pointed out that the SEC’s oversight function is vast, and its talented staff’s demands have grown dramatically. 

He noted that recent growth and changes in communications and the crypto markets had exposed investors to highly speculative asset classes, putting their hard-earned assets at risk. 

Gensler reiterated that as the cop on the beat, the SEC must meet the match of bad actors. He believes that allocating $2.4 billion to the SEC will enable the agency to be an even stronger advocate for the American public, investors, and issuers alike.

Nevertheless, Gensler’s testimony highlighted the SEC’s critical role in protecting the public and the need to modernize its rules to keep pace with technological advancements. The allocated funding will help the SEC expand and increase its complexity in the capital markets to meet the demands of its vast oversight function. 

The SEC’s deficit-neutral appropriations, offset by transaction fees, ensure the agency’s funding is secure. The SEC’s work to oversee federal securities laws plays a crucial role in the American public’s financial stability and the country’s economic success and geopolitical standing worldwide.

Related Reading | Cryptocurrencies to explode in 2023 – Don’t miss out on Hedera (HBAR) and Collateral Network (COLT)

‘Gensler Will Cost US Its World Leader Position in Finance,’ Says Deaton

https://coinedition.com/gensler-will-cost-us-its-world-leader-position-in-finance-says-deaton/

  • John E Deaton recently took to his Twitter account to express his agitation against Gensler.
  • Deaton mentioned that the arrogance of Gensler could cost the US its position as the world leader in finance.
  • The crypto lawyer also quoted examples of nations like the UK, Singapore, and UAE embracing cryptocurrencies.

CryptoLaw founder and cryptocurrency lawyer John E Deaton has recently taken to Twitter to express his agitation against the arrogance of US regulators. He expressed the view that regulators like Gary Gensler will cost the United States its position as the world’s leader in global trade and finance.

Deaton’s comment on the whole SEC thing comes after foreign regulators, including the UK, Singapore, UAE, Japan, and Switzerland, embrace the cryptocurrency industry. He mentioned that these “regulators are eating our lunch when it comes to crypto.”

The recent legal action against Binance intensifies the regulatory oversight of the top players in the cryptocurrency market. According to Bloomberg, the Internal Revenue Service and Securities and Exchange Commission are additionally conducting their own investigations into Binance.

Furthermore, Coinbase, the leading US-based cryptocurrency exchange, received a Wells notice from the SEC last week, which typically serves as a warning of potential enforcement action due to potential violations of securities laws.

Adding to the industry’s woes, earlier this month, two of the most significant connections between mainstream finance and the cryptocurrency world, Silvergate and Signature Bank, collapsed.

Analysts believe that the actions by the US regulators are part of sending an anti-crypto message. The regulators are reportedly launching an attack on the cryptocurrency industry tagged “Operation Choke Point 2.0.”

However, the community asserts that what the regulators fail to realize is that even if the cryptocurrency industry doesn’t receive the warmest welcome in the country, other global nations will provide the infrastructure for it to flourish.