One of the biggest pieces of news last week was Coinbase’s decision to file for a license to operate a derivatives exchange in Bermuda. In its wake, another prominent cryptocurrency exchange Gemini jumped onto the news train and announced the launch of Gemini Foundation – a “non-US” derivatives exchange that is planned to be situated,… Read More Notes 4/24: Crypto Derivatives
Privately issued currencies used for daily transactions are a long-held goal for libertarian crypto enthusiasts distrustful of fiat money issued by government. Stablecoins, or coins that can be exchanged at par for fiat, are the best bet to carry forward the crypto torch of payments that is not beholden to government diktat. But two legislations,… Read More Notes 4/22: Stablecoin Regulation
There was a thaw in the crypto winter yesterday, a glimmer of celebration, cloaked in schadenfreude, at the House Financial Services Committee hearing yesterday. Securities and Exchange Commission (SEC) Chairman Gary Gensler, sometimes referred to as crypto’s favorite whipping boy, testified before the committee yesterday. Crypto twitter cheered when a group of Republican Congressmen laid… Read More Notes 4/19: SEC Chief Gary Gensler’s Congressional Hearing
Will Coinbase become the next crypto entity targeted by regulators? The exchange was already served a Wells Notice by the Securities and Exchange Commission (SEC) last month. Now, after the agency slapped charges against cryptocurrency exchange Beaxy, speculation is rife that Coinbase might be next in line. Beaxy was a little-known operation based in Illinois.… Read More Is the Beaxy Case A Blueprint for Action Against Coinbase?
Coinbase has major beef with the Securities and Exchange Commission (SEC). After the company was served with a Wells Notice by the agency for selling unregistered securities, its chief legal officer Paul Grewal took to social media and wrote posts to air grievances. On his company’s website, Grewal wrote that his exchange – the biggest… Read More Notes 3/24: Coinbase
The Grayscale Bitcoin Investment Trust’s (GBTC) bid to overturn the SEC’s rejection of its spot bitcoin ETF last year received a shot in the arm from a US Appellate Court today. Questioning by Judge Neomi Rao and Judge Sri Srinivasan made news and upped the odds that Grayscale might prevail against the agency. Fraud in… Read More Notes 3/7: Grayscale ETF, OKB Again
This past week threw crypto’s banking problems into sharp relief. Silvergate Bank was arguably the biggest provider of banking services to the crypto industry and its unraveling will significantly reduce options available to crypto businesses for access to the world of mainstream financial services. As I wrote last year, three banks – Silvergate, Signature, and… Read More The Future of Crypto Banking
Bitcoin price is showing signs of life after remaining range-bound for most of last month, amid a widening crisis in the cryptocurrency ecosystem. The premiere cryptocurrency had been trading in the $15,000 to $17,000 price range as the contagion from crypto exchange FTX’s collapse claimed more victims. Inexplicably, it broke past the $17,000 mark this… Read More Notes 11/30: Bitcoin Price, Regulation
In a now famous Rolling Stone description of Goldman Sachs after the 2008 financial crisis, journalist Matt Taibbi compared the Wall Street titan to a “giant vampire squid wrapped around the face of humanity.” FTX may not have the same footprint as Goldman Sachs but its high profile within crypto has ensured that tremors of… Read More Notes 11/15: FTX Tremors, GBTC Discount, and An Industry Fund
The barrage of news about FTX’s collapse means that it will take time to disentangle the many narratives emerging from it. But that hasn’t stopped many people from suggesting solutions to ride out the current crisis of confidence in crypto. One of those proposals comes from Binance chief Changpeng Zhao, an instigator of the current… Read More Can Proof of Reserves Bring Transparency to Crypto?
Equities fell and crypto markets plummeted after Federal Reserve Chairman Jerome Powell reiterated his agency’s aggressive stance towards future interest rate hikes. The Dow Jones Industrial Average fell by 1.85% while the S&P 500 and Nasdaq Composite witnessed declines of 2.18% and 2.71% respectively immediately after the Fed’s speech. Bitcoin price fell by almost 5%… Read More Powell Reaffirms Aggressive Stance To Rate Hikes. What Does it Mean For Crypto?
Establishing an interface with banks has been one of the biggest problems for cryptocurrency businesses in the last ten years. Bitcoin’s dubious utility, an absence of regulatory guidance and volatility in crypto markets has made mainstream banks wary of processing transactions that involve cryptocurrencies. Crypto companies have, instead, turned towards smaller institutions. Three banks –… Read More Notes 8/16: Crypto Banks
Chandler Guo is what is known as an OG (Original Gangster, for the uninitiated) in crypto circles. A former beef salesman, Guo made his cryptocurrency millions by setting up a mining farm in Inner Mongolia and selling it for a massive payday during the asset class’s early days. He reportedly lives in a California mansion… Read More Notes 8/12: Chandler Guo’s Crusade, the Tornado Cash Circus
The Securities and Exchange Commission (SEC) and Commodities Futures Trading Commission (CFTC) want to know more about trading strategies employed by hedge funds and their digital asset holdings, according to multiple reports this morning. The two agencies have approved a proposal that will change Form PF – filed by private funds – to require more… Read More SEC Wants More Information About Digital Assets Holdings From Hedge Funds
Last month, as the crypto contagion was beginning to spread, FTX CEO Sam Bankman-Fried, who believes in “effective altruism”, talked about his “responsibility” to crypto with National Public Radio (NPR). “I do feel like we have a responsibility to seriously consider stepping in, even if it is at a loss to ourselves, to stem contagion,”… Read More Notes: 7/8: Voyager and Alameda, Celsius, and Grayscale ETF
According to reports, lending firm BlockFi is being sold in a fire sale to FTX. The firm, which was seeking a valuation of $5 billion in its previous funding round has a price tag of $25 million now. The reasons for a crash in its valuation are not clear. BlockFi CEO Zac Prince yesterday linked… Read More Notes: 1/7: BlockFi Valuation, EU Crypto Regulation, and More CoinFlex Drama
Bring out the popcorn. The dramas [and pyramid schemes] in crypto seem to go on forever. Just as the controversies about Three Arrows Capital and Celsius Lending were on the wane, we are being treated to another soap opera of sorts at CoinFLEX. The derivatives exchange stopped customer withdrawals due to “extreme market conditions” last… Read More Notes: 6/28: CoinFLEX Drama, Bitcoin As Commodity, Grayscale’s ETF Bid, and Crypto’s Robber Barons
Yesterday I wrote about a crypto mining bill that is sitting on Gov. Kathy Hochul’s desk. While New York’s net zero goals are ostensibly the driving factor behind the legislation, an element of political calculus could trump climate change concerns. According to the New York Times, Gov. Kathy Hochul’s re-election campaign has already received $40,000… Read More On Crypto Mining and NYDFS Guidance for Stablecoins
Regulation of cryptocurrencies by the Commodities and Futures Trading Commission (CFTC), tax exemptions for crypto transactions, and strict reserve requirements for stablecoin issuers are some of the proposals in a new bipartisan bill for cryptocurrency regulation from Senator Cynthia Lummis (R-Wy) and Sen. Kirsten Gillibrand (R-NY). The bill, titled the Responsible Financial Innovation Act, is… Read More Bipartisan Senate Bill Aims to Bring Order to Crypto But Could Set Up Dangerous Dynamic, Says a Critic
The demarcating lines between traditional finance and cryptocurrencies are becoming increasingly blurry. Recent announcements by regulators and crypto companies point the way to a future in which the two ecosystems, different in their working and philosophically antagonistic until recently, are coalescing to become a single entity. FTX has become the first crypto exchange to offer… Read More Crypto and Mainstream Finance Move Towards Each Other
It’s yesterday once more in cryptoland. The dizzying rise and rapid fall of algorithmic stablecoin TerraUSD’s (UST) demise brings to mind the initial coin offering (ICO) frenzy of 2017. Back then, all you needed to raise funds from investors was a whitepaper and a generous marketing budget to hype the offering. With the media and… Read More In The Aftermath of stablecoin UST’s Collapse