Autor Cointelegraph By Felix Ng

Gillibrand and Lummis state that most altcoins are securities

Gillibrand and Lummis state that most altcoins are securities

Uverejnil používateľ | jún 9, 2022 |

Senators Kirsten Gillibrand and Cyntia Lummis believe that most altcoins would likely be considered securities under their proposed new legislation — but confirmed that Bitcoin (BTC) and Ether (ETH) will be classified as commodities. Lummis and Gillibrand both agreed with Securities and Exchange Commision Chair Gary Gensler’s assessment that most cryptocurrencies are securities under the Howey test with Gillibrand stating:“Most cryptocurrencies go to the SEC […] Bitcoin and Ether would be certainly commodities, and that’s agreed upon. That’s agreed with Chairman Gensler as well as the chairman of the CFTC.”Gillibrand pushed back on reports characterizing the legislation as making the CFTC the primary regulator. “I don’t think CFTC is the primary regulator,” she said. “They just have the obligation to regulate Bitcoin and Ether, the majority of cryptocurrencies today.”The pair made the comments during a Washington Post event on June 8, a day after releasing the details of the Responsible Financial Innovation Act..@SenLummis tells @ToryNewmyer, “The CFTC, although it will have the lion share by market cap, the majority of the digital assets…have characteristics of securities that will require the SEC’s disclosure capabilities….The SEC’s role in this is absolutely critical.” pic.twitter.com/1B0wnQQ62p— Washington Post Live (@PostLive) June 8, 2022Rostin Behnam, chair of the Commodity Futures Trading Commission (CTFC), was also at the event and took a slightly different view on the proportion of altcoins that are securities. He said that while there are “probably hundreds” of coins that replicate security coins, there are also many commodity coins, such as Bitcoin (BTC) and Ether that should be regulated by the CFTC.“It’s pretty clear that many of the digital assets themselves replicate or look like commodities. They’re more like stores of value than they are securities.”Tony Tuths, head of the digital assets team at KPMG Tax, told Cointelegraph that the legislation, under its current form is unlikely to “move forward” in the foreseeable future, adding it was unclear which coins will ultimately fall within the purview of the SEC versus the CTFC.“On the regulatory side the legislation calls for the CFTC to be the primary regulator but then carves out a wide swath of tokens that have attributes similar to securities for regulation by the SEC. It will be a struggle to decipher what exactly is in the SEC bucket but it could be the exception that swallows the rule. “Related: Class action suit against Coinbase alleges unregulated securities salesThe new bipartisan bill is expected to lean heavily on the Howey Test to determine whether a particular coin is classed as a security or a commodity. “We’re trying to just fit the digital asset world into our current regulatory framework. […] We spent a lot of time on the definition of the modern Howey test,” said Senator Lummis during a CNBC interview on June 7.The Howey Test is a framework set by the U.S. Supreme Court to determine whether a transaction qualifies as an investment contract, and thus considered security. The Howey Test has become a focal point in the SEC’s case against Ripple which began in December 2020, alleging that the company used its digital token XRP to raise funds in 2013, and was an unregistered security token at the time.

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Crypto-stock trade pairs in the cards as Swyftx inks $1.5B merger with Superhero

Crypto-stock trade pairs in the cards as Swyftx inks $1.5B merger with Superhero

Uverejnil používateľ | jún 8, 2022 |

Australian crypto exchange Swyftx wants to eventually offer seamless trading between traditional and crypto-asset classes, with its first step being the completion of its $1.5 billion merger deal with online investing platform Superhero. The deal to combine the two was revealed on June 8, with the merged entity set to become the first in Australia to offer both decentralized and traditional finance. We’re teaming up with equities trading platform & fellow Aussie fintech @superheroaus, to give you the opportunity to invest in digital and traditional assets – all in one place! Official announcement here https://t.co/ygmeaS3wuq pic.twitter.com/Ivhsa2lybI— Swyftx (@SwyftxAU) June 7, 2022Speaking to Cointelegraph on Wednesday, Swyftx co-CEO Ryan Parsons revealed that one of its longer-term goals is to explore “greater interoperability between asset classes.”“You can imagine customers trading their Bitcoin or other digital assets for equities in listed companies like Tesla, and vice versa.”Parsons said that its first priority will be to work with regulators and set up appropriate customer protections:“But it’s important to be clear that we’re working through all the regulatory requirements in what is already a quickly evolving regulatory landscape. We’re extremely keen to ensure that whatever we do, is done properly with appropriate customer protections in place.”Related: Aussie consumer group calls for better crypto regs due to ‘lagging laws’While the merger news appeared to come without any prior warning, Parsons said it was “no surprise” that a number of equity trading platforms have been looking to offer crypto trading and vice versa, and that discussions with Superhero about a merger had been underway for several months prior:“The two teams have been actively talking for a few months, with the merger following out of initial discussions around the potential for a crypto-equities partnership opportunity. It just made more sense to join forces than to be partners.”Co-founded by Alex Harper and Angus Goldman in 2018, Swyftx is an Australian crypto exchange, offering 320 digital currencies and crypto interest-earning products. The company’s exchange saw a banner year in 2021, growing its investor base by nearly 1,200% to over 600,000 retail and corporate investors.Superhero, an online broker, was founded in the same year, but launched only in late 2020. Over the last 12 months, the company has grown its investor base by more than 600% to over 200,000 investors, allowing them to trade Australian and U.S. stocks, as well as manage their Superhero superannuation (Australia’s version of 401K) a product launched in July 2021. In a statement on June 8, Swyftx said the completed merger would create a combined customer base of 800,000 when it’s completed around mid-2023. The combined platform will allow customers to trade and invest across cryptocurrencies, equities and superannuation. Later, Parisons said the company wants to build out its product offerings, which could include banking-type services or other traditional finance products and services.Following the merger, Swyftx co-founder Alex Harper and current Swyftx CEO Ryan Parsons will become co-CEOs of the combined entity. John Winters will head up the traditional financial services arm and take a position on the board of directors. Winters told the Sydney Morning Herald on Tuesday evening that there was a possibility of listing the combined entity on the Australian stock exchange once the merger is tied off, but said there would be “a lot of work to be done before we get to that stage.”Winters stated that, for the time being, the two platforms will continue to operate independently of each other, and no job losses are expected as part of the merger.

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Grayscale hires former Solicitor General to help force Bitcoin ETF approval

Grayscale hires former Solicitor General to help force Bitcoin ETF approval

Uverejnil používateľ | jún 8, 2022 |

Grayscale Investments has hired a former U.S. Solicitor General in preparation for a potential legal spat with the U.S. Securities and Exchange Commission (SEC), should the regulator reject its application for a spot Bitcoin (BTC) exchange-traded fund (ETF) on July 6.The company has been waiting on a decision from the SEC to convert its flagship $19.8 billion Grayscale Bitcoin Trust (GBTC) into a spot-based ETF, since filing its application to the regulator on October 19, 2021. The SEC has pushed back its decision on multiple occasions, once in December and again in February. A final decision on the application is expected on July 6. Jake Chervinsky, head of policy at the crypto advocacy group Blockchain Association said adding such firepower to Grayscale’s legal team was a “strong move”, and that the SEC would have little chance of “surviving a legal challenge” if it decided to knock back approval now. Strong move. @Grayscale means business.The SEC’s deadline to approve or deny the application to convert GBTC to an ETF is July 6. No doubt, it should be approved. I don’t see how the SEC survives a legal challenge if not, especially one led by Don Verrilli.Mark your calendar. https://t.co/ZbZ7oTXhHR— Jake Chervinsky (@jchervinsky) June 7, 2022In March, Grayscale CEO Michael Sonnenshein told Bloomberg that his firm would consider a lawsuit under the Administrative Procedure Act (APA) should the application for its Bitcoin Spot ETF be denied by the financial regulator.He has been a vocal critic of the regulator, which approved crypto futures ETF products in October 2021 but is yet to do so for a spot ETF equivalent. Donald B. Verrilli Jr., the new hire, is a former U.S. Solicitor General who served from 2011 to 2016 under Barack Obama’s administration. He is currently a partner in Californian law firm Munger, Tolles & Olson, and founded its Washington D.C. Office in 2016. On Twitter, Grayscale explained that the lawyer has been involved in more than 50 cases before the U.S. Supreme Court, including several that dealt directly with Administrative Procedure Act (APA) violations.He will serve as a senior legal strategist, working alongside its attorneys at Davis Polk & Wardwell LLP and its in-house counsel, including Craig Salm, who serves as chief legal officer. Don’s legal acumen is unmatched. There’s no better advocate we could have to join our legal strategy team with @DavisPolkReg as we continue advocating to convert $GBTC to a spot #Bitcoin ETF. https://t.co/ZruXc1aiQ6— Craig Salm (@CraigSalm) June 7, 2022

Grayscale described Verrilli as one of the nation’s most experienced attorneys with “a deep understanding of legal theory, administrative procedure, and the practical matters of working with the judiciary branch.”“We are thrilled that he is joining our team as we work towards a positive resolution for investors and the general public.”As we enter the final month before a response is due on our application to convert $GBTC to an ETF, we have retained Donald B. Verrilli, Jr., former Solicitor General of the United States, as additional legal counsel. A short on why:— Grayscale (@Grayscale) June 7, 2022

Meanwhile Citadel Securities, a market maker that could provide liquidity for crypto ETFs such as that proposed by Grayscale on Tuesday said it was open to supporting crypto ETFs but won’t do so without regulators’ approval. “We will be ready if and when those products are approved, but we are taking a measured approach,” said Citadel ETF head Kelly Brennan said in an interview with Bloomberg. Market makers are key liquidity providers in the ETF ecosystem as they ensure continuous and efficient ETF trading. Related: Why the world needs a spot Bitcoin ETF in the US: 21Shares CEO explainsElsewhere in the world, crypto-linked ETFs have been gaining increasing popularity, with total assets invested in crypto ETFs and exchange-traded products (ETP) globally reaching $16.28 billion by the end of Q1 2022, according to data from ETF research firm ETFGI.In February 2021, Canada debuted its first-ever Bitcoin ETF, the Purpose Bitcoin ETF, becoming one of the first countries in the world to adopt a spot Bitcoin ETF.On May 12, Australia launched its first spot crypto ETFs, including a Bitcoin ETF from Cosmos Asset Management, plus BTC and Ether (ETH) spot ETFs from 21Shares. Another two crypto-backed ETFs were launched on Monday, June 6. In May, Grayscale began trading its first European ETF, called Grayscale Future of Finance UCITS ETF, which has listings on the London Stock Exchange, Borsa Italiana as well as Deutsche Börse’s electronic trading platform Xetra.

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Fed forgets long-term dollar devaluation when pricing eggs in BTC

Fed forgets long-term dollar devaluation when pricing eggs in BTC

Uverejnil používateľ | jún 7, 2022 |

The St. Louis Federal Reserve stirred up a mix of amusement and curiosity from the crypto community on Tuesday, May 7, after publishing a post showing how the cost of eggs in Bitcoin (BTC) has fluctuated over the last 14-months compared to the U.S. dollar. On June 6, the Fed research arm posted a blog post titled “Buying eggs with bitcoins – a look at currency-related price volatility.”The FRED Blog compares egg prices in U.S. dollars vs. bitcoins. Check out the post to see which prices are more stable https://t.co/Qfy9w8zgBk pic.twitter.com/qpFH4ny33S— St. Louis Fed (@stlouisfed) June 6, 2022The post initially features a graph showing the historical price of eggs in U.S. dollars for every month since January 2021, noting that the prices fluctuated between $1.47 and $2.52 over the 14-month period.Source: The FRED® BlogIt then follows this up with a graph showing how Bitcoin has behaved in the same time period, noting that the price fluctuated “much more than it did for the U.S. dollar price.” The report did not stipulate whether the price of eggs had increased or the dollar had devalued, or both, as causes for the trend.”What would the graph look like if we purchased that same carton of eggs with bitcoins instead of U.S. dollars?”Source: The FRED® BlogIt also drew attention to Bitcoin’s transaction fees, which it says can fall between $2 and $50. “Plus, you’d need to add a bitcoin transaction fee, which has been about $2 lately, but which can spike above $50 on occasion. Hopefully, if you were making this purchase with bitcoin, you’d put many many more eggs in your basket,” it wrote.Crypto Twitter reactsThe blog post ultimately drew ire from the crypto community on Twitter, with many arguing that the fed was “cherry-picking” the time period to push the narrative of Bitcoin’s instability, rather than “zooming out”, which would instead show the massive devaluation of the U.S. dollar.The Fed wrote a post showing the price of eggs in USD and Bitcoin, comparing them over the last year, showing Bitcoin as more volatile and unpredictable.Only problem was they forgot to zoom outhttps://t.co/WrCyaI4NP6 pic.twitter.com/rJVbedAs2z— Nick Neuman (, ) (@Nneuman) June 6, 2022

A Twitter user going by the name @MapleHodl pointed out the obvious by stating that the USD is continuously depreciating over time and Bitcoin is volatile short term, though appreciating, so “stack yolks accordingly.” Other Twitter users said that for the Fed to even recognize Bitcoin as a unit of account as being a net positive sign for the king crypto.Even the Fed is starting to price consumer goods in BTC. Bullish.Price of eggs going down. No inflation. pic.twitter.com/hbeR38PWdx— Joe Burnett ()³ (@IIICapital) June 6, 2022

“No matter how they put it. They used Bitcoin as a unit of account to compare. That’s really big.”Related: Fed money printer goes into reverse: What does it mean for crypto?The recent post from the Federal Reserve Bank of St. Louis comes as a survey from Bloomberg’s MLIV Pulse on June 6 revealed that crypto and tech stocks are “acutely vulnerable” to quantitative tightening plans by the U.S. central bank aimed at dampening inflation. Source: bloomberg.com“The historic shift is seen as a notable threat to tech equities and digital tokens — both risk-sensitive assets that soared in the Covid-era market mania before cratering in this year’s cross-asset crash.”Since 2009, when Bitcoin first came into existence, the U.S. dollar has lost 26% of its value, tracking an average inflation rate of 2.32% per year since then, according to this inflation calculator. On the other hand, one Bitcoin, which started at a value of $0.00 in 2009, is now worth $29,495 at the time of writing. The below chart shows the purchasing power of one U.S. dollar in today’s terms. In 1913, one U.S. dollar could buy 30 Hershey’s chocolate bars. In 2020, it can buy just one McDonald’s coffee. Additionally, the money supply (M2) in the U.S. has skyrocketed over the last two decades, increasing from 4.6 trillion in 2000 to $19.5 trillion in 2021.USD purchasing power over time – visualcapitalist.com

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Half of Asia's affluent investors have crypto in their portfolio: Report

Half of Asia's affluent investors have crypto in their portfolio: Report

Uverejnil používateľ | jún 7, 2022 |

Affluent investors in Asia are neither shy nor ignorant about crypto, with research revealing that 52% of them held some form of a digital asset during Q1 2022. According to research from Accenture published on June 6, digital assets, which include cryptocurrencies, stable coins, and crypto funds, made up on average 7% of the surveyed investors’ portfolios, making it the fifth-largest asset class for investors in Asia. It was more than they allocated to foreign currencies, commodities, and collectibles, and in some cases was on par with or exceeded the amount invested in private equity/venture capital and hedge funds. Accenture said the survey was conducted with more than 3,200 clients across China, Hong Kong, India, Indonesia, Japan, Malaysia, Singapore, and Thailand. The company defines an affluent investor as anyone that manages investable assets of between US$100,000 to $1 million. Investors in Thailand and Indonesia had the largest percentage of digital assets in their portfolios compared to their peers.Source: accenture.comThough half of the investors in Asia were already holding digital assets in Q1 2022, Accenture’s research indicates that a further 21% are expected to invest in them by the end of 2022, meaning as many as 73% of wealthy Asian investors could hold a digital asset by the end of the year. “Digital assets represent a rare, clear industry white space with significant business opportunity.”Wealth managers holding backHowever, the firm found that wealth management firms, those that provide financial planning, tax, investment advice, and estate planning to their clients, have been slow to board the crypto train. 67% of wealth management firms said they have no plans to offer digital asset products or services. “For wealth management firms, digital assets are a US$54bn revenue opportunity— that most are ignoring.”Wealth management firms cited a lack of belief and understanding of digital assets, a wait-and-see mindset, and the operational complexity of launching a digital asset offering as the main reason for holding back, leading them to prioritize other initiatives instead. Source: accenture.comAccenture said the lack of engagement by firms means that investors have been forced to get their financial advice about crypto from unreliable sources.“This lack of engagement by firms means many clients are seeking advice about digital assets on unregulated forums, including peer-to-peer advice on social media.”Related: Social media blamed for $1B in crypto scam losses in 2021However, Accenture has stressed the importance for wealth management firms to push forward into the digital asset space, or risk being left behind. “While many firms are hesitant to enter the digital assets space, and for a range of reasons, their competitors have shown that success is possible.”Asia’s investors have been warming up to crypto, particularly in the last year. In April, a report by Gemini cryptocurrency exchange found that crypto adoption skyrocketed in 2021, particularly in countries such as India and Hong Kong. Around 45% of respondents in the Asia Pacific purchased their first crypto in 2021.

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