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Tag: sec

  • Guide to College Football’s Nonsensical 2024 Power Five Realignment

    Guide to College Football’s Nonsensical 2024 Power Five Realignment

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    Living here in the great state of Texas, we know as well as anybody about the craziness and chaos that have unfolded in collegiate sports realignment. The phenomenon is largely driven by football, because that sport is what paves the money trail for everybody else.

    There had been some small shifts in conference membership in the ’80s and ’90s and even the early 2000s, when the Big East as a football conference essentially disintegrated, making the Power Six a Power Five. In the early 2010s is when realignment began to land in our backyard in Texas, most notably with the Texas A&M Aggies moving to the SEC from the Big XII.

    Then, after roughly a decade of realignment peace, Texas and Oklahoma dropped a grenade on the college football world, choosing to move from the Big XII to the SEC, a move that was made official on Monday. It was this move that essentially injected college football conference geographical knowledge with meth. A year after Texas and Oklahoma announced their decision, USC and UCLA chose to move to the Big Ten, where the closest team geographically to both was Nebraska. Repeat, NEBRASKA!

    After that it was chaos. The entire Pac-12 went scurrying for life rafts in other conferences, geographical sense be damned!

    So here we are, with a total of 15 FBS schools changing conferences this summer, including several in the Power Four. Oh what’s that you say? You thought it was the Power FIVE? Yeah, it WAS, until the Pac-12 exodus left Oregon State and Washington State as two college sports orphans. Hard to call the Pac-TWO a “power conference.”  To help you keep track of all the moves, here is a primer on the changes that will go into effect this season:

    BIG TEN (18 teams)
    Illinois
    Indiana
    Iowa
    Maryland
    Michigan
    Michigan State
    Minnesota
    Nebraska
    Northwestern
    Ohio State
    Penn State
    Purdue
    Rutgers
    UCLA
    USC
    Oregon
    Washington
    Wisconsin

    SEC (16 teams)
    Alabama
    Arkansas
    Auburn
    Florida
    Georgia
    Kentucky
    LSU
    Mississippi State
    Missouri
    Ole Miss
    Oklahoma
    South Carolina
    Tennessee
    Texas
    Texas A&M
    Vanderbilt

    Big XII (16 teams)
    Arizona
    Arizona State
    Baylor
    BYU
    Cincinnati
    Colorado
    Houston
    Iowa State
    Kansas
    Kansas State
    Oklahoma State
    TCU
    Texas Tech
    UCF
    Utah
    West Virginia

    ACC (17 football teams)
    ACC
    Boston College
    Cal
    Clemson
    Duke
    Florida State
    Georgia Tech
    Louisville
    Miami
    NC State
    North Carolina
    Pitt
    SMU
    Stanford
    Syracuse
    Virginia
    Virginia Tech
    Wake Forest
    (Notre Dame is a non-football member)

    There is so much silly, insane, and somewhat exhilarating stuff going on here. Just a few thoughts on this new conference structure, in which the most ratchet Magic 8-Ball could not have generated a sillier outcome with some of this stuff.

    SILLY: West Coast schools in the Big Ten
    The nice thing about the pre-realignment universe was not only the conferences making geographic sense, but they each had their own culture and feel, that admittedly reflected the geographic. The Big Ten was cold weather, in the trenches, tough guy football. The Pac-12 was laid back, high flying, offensive fireworks. So UCLA and USC (and Oregon and Washington) make no sense culturally, not to mention the fact that all of their non-football sports have to travel to places like Minnesota and Rutgers for road games. Silly.

    INSANE: The ACC, which has the word “Atlantic” in the name!
    Okay, it’s bad enough that the Big Ten has West Coast schools as conference members now, and sure, the Big Ten now has 18 schools, but there is nothing dumber, nor more insane in realignment, than a conference with the word “Atlantic” in its name having SMU, Stanford, and Cal as members. Cal and Stanford literally are minutes from the PACIFIC F-ING OCEAN! I’d bet big money on the ACC disintegrating sometime in the next five years.

    EXHILARATING: Coach Prime is in the Big XII!
    Okay, now for the good, for those of us in Texas. In 2024, the Big XII actually picks up one of the biggest stories from 2023. Coach Prime, the Hall of Famer Deion Sanders, and the Colorado Buffaloes were THE story in college football for the first month of the 2023 season, largely because of the brash persona and a couple big upset wins. The season did not end well, as the Buffs wound up going 4-8, but they still enter the 2024 season with some buzz, with Shedeur Sanders, son of Deion, a top Heisman candidate and likely top 10 pick in the 2025 NFL Draft.

    Listen to Sean Pendergast on SportsRadio 610 from 6 a.m. to 10 a.m. weekdays. Also, follow him on Twitter at twitter.com/SeanTPendergast, on Instagram at instagram.com/sean.pendergast, and like him on Facebook at facebook.com/SeanTPendergast.

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  • Coinbase Files Suits Against SEC, FDIC Over Compliance With Crypto Information Requests

    Coinbase Files Suits Against SEC, FDIC Over Compliance With Crypto Information Requests

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    The largest United States cryptocurrency exchange, Coinbase, has filed lawsuits against the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC) for failing to comply with information requests in closed crypto cases.

    According to filings at the United States District Court for the District of Columbia, Coinbase seeks to compel the SEC and FDIC to comply with the Freedom of Information Act (FOIA) to respond to information requests from industry participants.

    Coinbase Sues SEC and FDIC

    Coinbase argues that the SEC has taken a new position, claiming sweeping authority over the growing crypto sector. While the SEC’s claims have no basis in securities laws, the agency has failed to explain properly and, instead, waged an enforcement war against crypto firms.

    The exchange said the regulator’s joint effort with other financial watchdogs, like the FDIC, to de-bank crypto firms is aimed at crippling the digital asset industry.

    Coinbase and professional services research firm History Associates have requested that the SEC prove its authority over the crypto space by providing records concerning three investigations into such firms and entrepreneurs. One of the investigations is focused on Ethereum’s native asset, Ether, which the SEC said was not a security in 2018.

    Last week, the agency closed its investigation into Ethereum 2.0, the proof-of-stake network, suggesting that Ether is still not a security. Although the other investigations had been closed for years, the SEC withheld all records based on the three cases. Coinbase claims the refusals violated the regulator’s FOIA obligations.

    “The SEC’s new, opaque, and shifting view of the securities laws deprives regulated parties of the fair notice demanded by due process, leaving them to guess whether the SEC might view their activities as securities transactions and decide to subject them to investigation, prosecution, and backward-looking penalties,” Coinbase insisted.

    SEC’s Ongoing Suit Against Coinbase

    Coinbase’s chief legal officer, Paul Grewal, further revealed that the FDIC stonewalled requests for letters telling financial institutions to pause crypto-related activities indefinitely. Interestingly, the FDIC’s Office of Inspector General has criticized such actions in the past, claiming that they would limit financial innovation and growth in the crypto space.

    “This is no way to regulate. And this is no way to operate a transparent government. Today, we demand better from our financial regulators. We appreciate the Court’s attention to these important issues and look forward to sharing updates in the future,” Grewal stated.

    Meanwhile, the SEC has an ongoing lawsuit against Coinbase, arguing that the firm operates an unregistered securities exchange.

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  • Ripple’s Legal Battle’s Focus Shifts to CEO’s 2017 XRP Comments

    Ripple’s Legal Battle’s Focus Shifts to CEO’s 2017 XRP Comments

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    A US federal court judge has allowed a civil securities lawsuit against Ripple Labs to proceed.

    This decision came after Judge Phyllis Hamilton of the California District Court denied Ripple’s request for summary judgment in a case involving allegations that its CEO, Brad Garlinghouse, violated California securities laws.

    “Misleading Statements” on XRP

    The allegations focus on claims that the exec made “misleading statements” about XRP’s status during a televised interview while at the same time expressing skepticism about the utility of other digital assets.

    The official court document said that this statement was shared on Ripple’s official Twitter account, which amplified its reach.

    The plaintiff argued that Garlinghouse’s statement was misleading and claimed that the exec had been selling millions of XRP throughout 2017 on various cryptocurrency exchanges despite publicly announcing that he remains “very, very, very long XRP” and his intention to “hodl” the asset.

    “I’m long XRP, I’m very, very long XRP as a percentage of my personal balance sheet. . . . . [I am] not long on some of the other [digital] assets, because it is not clear to me what’s the real utility, what problem are they really solving . . . if you’re solving a real problem if it’s a scaled problem, then I think you have a huge opportunity to continue to grow that. We have been really fortunate obviously, I remain very, very, very long XRP, there is an expression in the industry HODL, instead of hold, it’s HODL . . . I’m on the HODL side.”

    Court Ruling Challenges XRP’s Status for Non-Institutional Investors

    Judge Hamilton’s ruling addressed Ripple’s argument that the “misleading statement” allegation should be dismissed since XRP does not meet the criteria of security under the Howey test. The blockchain firm had cited Judge Analisa Torres’ decision from July 2023 in its lawsuit involving the Securities and Exchange Commission.

    However, Hamilton took a different stance in her recent order and instead determined that XRP could potentially be classified as a security when sold to individual investors, as opposed to institutional ones.

    As noted in the filing, she reasoned that these non-institutional investors would have anticipated profits resulting from Ripple’s efforts, which is one of the important factors considered in the Howey test for determining whether an asset qualifies as a security.

    “Overall, given the relative novelty of cryptocurrency, and given the lack of any controlling law regarding the motivation of a reasonable cryptocurrency investor, the court declines to find as a matter of law that a reasonable investor would have derived any expectation of profit from general cryptocurrency market trends, as opposed to Ripple’s efforts to facilitate XRP’s use in cross-border payments, among other things

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  • Ripple Escalates Pro-Crypto Advocacy with $25M Fairshake Fund

    Ripple Escalates Pro-Crypto Advocacy with $25M Fairshake Fund

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    Ripple has contributed $25 million to the Fairshake super PAC, aligning with an industry-wide effort to advocate for pro-crypto policies and politicians.

    Ripple’s decision to boost Fairshake’s efforts comes amid its own ongoing legal battle with regulatory bodies like the SEC. The agency’s lawsuit prompted the company to take a more proactive stance in advocating for fair and balanced regulation within the industry.

    Ripple Advancing Pro-Crypto Agenda

    In a press release, Ripple stated that the Securities and Exchange Commission’s strategy of attempting to regulate the cryptocurrency industry through enforcement has proven ineffective.

    While Congress is presently progressing with comprehensive legislation for the sector to ensure a bright future for American innovation, competitiveness, and expansion, the United States lags behind other nations that have embraced the asset class and its underlying technology.

    Ripple highlighted the critical importance of the 2024 elections for the industry, emphasizing the choice between candidates supporting or hindering technological innovation. It also highlighted the need for leaders who understand and promote policies fostering innovation, consumer protection, and market fairness.

    While speaking about the contributing Ripple CEO Brad Garlinghouse said,

    “Our contributions to Fairshake are just one of the many ways Ripple will actively invest in educating voters on the role crypto will play in the future and the dangers of the anti-crypto stance some policymakers are clinging to in Washington.”

    The exec also added that the company as well as the rest of the industry should refuse to remain silent in the face of unelected regulators’ attempts to stifle progress and economic advancement, which millions of Americans benefit from.

    The development comes almost six months after Ripple gave $20 million to Fairshake, which has already used $11.3 million for federal elections. This increase in contributions marks a significant rise in the company’s political activity. According to FEC records, the San Francisco-based company had only donated $500,000 during the 2022 election cycle.

    Ripple’s contributions make up nearly half of the $100 million-plus raised by Fairshake from major figures in the cryptocurrency sector, including industry giants like Coinbase and Gemini exchanges, venture capital leader Andreessen Horowitz, and asset management powerhouse ARK Invest.

    Ripple-SEC: Legal Showdown

    Ripple has been engaged in a prolonged legal dispute with the US Securities and Exchange Commission (SEC) for several years, following accusations by the regulatory watchdog that the company unlawfully raised $1.3 billion through the sale of XRP, which it deemed an unregistered security.

    The SEC recently filed a remedies brief contesting Ripple’s stance on penalties in their ongoing legal dispute. It essentially seeks fines against Ripple despite Judge Torres’ ruling that XRP is not a security in programmatic sales. The blockchain company, on the other hand, argued that fines should not surpass $10 million, citing a lack of fraudulent intent. Both parties await a final ruling.

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  • Breaking down the NCAA’s nearly $3 billion settlement

    Breaking down the NCAA’s nearly $3 billion settlement

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    Breaking down the NCAA’s nearly $3 billion settlement – CBS News


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    College athletics will soon change forever thanks to a new pay structure for schools and athletes. That’s because the NCAA and the nation’s five biggest conferences have agreed to pay nearly $3 billion to settle multiple antitrust claims. CBS News reporter Taurean Small has the details.

    Be the first to know

    Get browser notifications for breaking news, live events, and exclusive reporting.


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  • SEC tightens data breach regulation | Bank Automation News

    SEC tightens data breach regulation | Bank Automation News

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    The Securities Exchange Commission has proposed stricter regulations on how financial institutions deal with data breaches as cyberattacks climb.  The SEC proposed amendments to its “Privacy of Consumer Financial Information and Safeguarding Customer Information” regulation, implemented in 2000, according to a May 15 fact sheet from the commission. The federal watchdog is looking to implement […]

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    Vaidik Trivedi

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  • Mark Cuban Joins Calls Against Anti-Crypto Biden Administration, Slams the SEC 

    Mark Cuban Joins Calls Against Anti-Crypto Biden Administration, Slams the SEC 

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    On May 11, the American businessman and television personality said if Joe Biden loses the presidential election, “there is a good chance you will be able to thank Gary Gensler and the SEC (Securities and Exchange Commission).”

    “Crypto is a mainstay with younger and independent voters,” he said before adding that SEC Chair Gensler “has not protected a single investor against fraud.”

    The outspoken entrepreneur didn’t stop there, adding that all the SEC has done is make it virtually impossible for crypto companies to operate in the United States, “killing who knows how many businesses and ruining who knows how many entrepreneurs.”

    Biden’s War On Crypto Riles Rivals

    The comments came in response to a May 10 Politico article reporting that Donald Trump has become the first major party presidential nominee to overtly court the crypto community.

    Trump told supporters this week that they should vote for him because of the way the Biden administration has cracked down on the crypto industry.

    Kristin Smith, CEO of the Blockchain Association, said, “President Trump’s remarks signal a sea change in the importance of digital assets this election cycle,”

    Cuban, who castigated the SEC in 2023, continued with a warning to Congress stating that crypto voters will be heard this election. He suggested that passing legislation specifically for crypto companies and the asset class could solve the problem for Biden before adding:

    “Or you could do the better option and assign all crypto to be regulated by the CFTC (Commodity Futures Trading Commission).”

    Bitcoin environmentalist Daniel Batten agreed with Cuban, commenting:

    “Joe Biden could well be the world’s first politician to lose an election due to his party’s open hostility towards Bitcoin, and indulgence of colleagues spreading misinformation about Bitcoin.”

    Cuban wasn’t the only one lashing out at the Biden administration this week. Cardano founder Charles Hoskinson lambasted the White House in a video on X on May 9.

    “A vote for Biden is a vote against the American cryptocurrency industry,” said Hoskinson, who added that the Biden administration is actively trying to “destroy the American cryptocurrency industry.”

    Others, including Ethereum advocate Ryan Sean Adams and Stock-to-flow model creator “PlanB”, joined the calls against the anti-crypto administration.

    Crypto Crackdown Escalates

    Biden’s war on crypto has escalated in recent weeks. The SEC is now targeting larger trading companies, such as Robinhood, which received a threat of enforcement action over its crypto business this month.

    Additionally, Biden’s office said it would veto legislation seeking to overturn SEC guidelines that discourage banks from holding crypto assets in custody.

    Pro-crypto Senator Cynthia Lummis reacted to Biden’s threat to ban banks from holding crypto for their customers, stating, “We will not allow the administration to regulate tools for financial freedom out of existence.”

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  • SEC Further Extends Date for Decision on Invesco Galaxy Spot Ethereum ETF

    SEC Further Extends Date for Decision on Invesco Galaxy Spot Ethereum ETF

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    The US Securities and Exchange Commission (SEC) has postponed its decision on whether to approve or disapprove the proposed Invesco Galaxy spot Ethereum exchange-traded fund (ETF) product for the third time.

    With the latest delay, the agency has until July 5 to make its final decision on the spot Ether ETF application.

    • The SEC announced the postponement in a filing on May 6, stating that it would need another 60 days to decide either to approve or reject the Invesco Galaxy spot Ethereum ETF.
    • As previously reported by CryptoPotato, the agency first delayed making a decision in December 2023 and made a second extension in February 2024.
    • A proposal for the Invesco Galaxy Ethereum ETF was filed with the SEC on Oct. 20, 2023, which was published in the Federal Register on Nov. 8, 2023.
    • The agency has a total of 240 days from the publication to make extensions before making a final decision to approve or disapprove the application, which, according to the latest SEC’s announcement, is set for July 5, 2024.
    • An excerpt from the filing reads:

    “The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein.”

    • The agency has also delayed similar applications from BlackRock, Fidelity, VanEck, and Grayscale, with VanEck being the first applicant to await the SEC’s final decision on May 23, 2024.
    • Meanwhile, optimism about the possible approval of a spot Ethereum ETF seemed to have waned in recent months, with Bloomberg ETF analyst Eric Balchunas stating that the odds of the SEC approving such a product in May is 25%.
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  • Trump Media’s accountant is charged with “massive fraud” by the SEC

    Trump Media’s accountant is charged with “massive fraud” by the SEC

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    BF Borgers, the independent accounting firm for Trump Media & Technology Group, is facing allegations of “massive fraud” from the Securities and Exchange Commission, which on Friday claimed the auditor ran a “sham audit mill” that put investors at risk. 

    The SEC said Borgers has been shut down, noting that the company agreed to a permanent suspension from appearing and practicing before the agency as accountants. The suspension is effective immediately. Additionally, BF Borgers agreed to pay a $12 million civil penalty, while owner Benjamin Borgers will pay a $2 million civil penalty.

    Neither the SEC statement nor its complaint mentioned Trump Media & Technology Group. Borgers didn’t respond to a request for comment.

    In an email, Trump Media said it “looks forward to working with new auditing partners in accordance with today’s SEC order.”

    The SEC charged Borgers with “deliberate and systemic failures” in complying with accounting standards in 1,500 SEC filings from January 2021 through June 2023, a period during which Borgers had about 350 clients. Trump Media’s March debut as a public company came after that time period, but the social media company said in its 2023 annual report that it had worked with Borgers prior to going public on the Nasdaq stock exchange.

    In its report, the company added that an audit committee on March 28 approved Borgers to audit its 2023 and 2022 financial statements.

    Among the issues cited by the SEC is that Borgers failed to comply with Public Company Accounting Oversight Board (PCAOB) standards in its audits, even though the regulatory agency requires that public companies’ financial statements meet those standards. Borgers also allegedly falsely told clients that its work would comply with those standards. 

    The agency claims that at least 75% of the filings that incorporated Borgers’ audits and reviews failed to meet PCAOB standards. 

    “Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets,” Gurbir S. Grewal, director of the SEC’s Division of Enforcement, said in the statement. 

    He added, “As a result of their fraudulent conduct, they not only put investors and markets at risk by causing public companies to incorporate noncompliant audits and reviews into more than 1,500 filings with the Commission, but also undermined trust and confidence in our markets.”

    Aimee Picchi

    Aimee Picchi is the associate managing editor for CBS MoneyWatch, where she covers business and personal finance. She previously worked at Bloomberg News and has written for national news outlets including USA Today and Consumer Reports.

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  • Why hundreds of U.S. banks may be at risk of failure

    Why hundreds of U.S. banks may be at risk of failure

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    Hundreds of small and regional banks across the U.S. are feeling stressed.

    “You could see some banks either fail or at least, you know, dip below their minimum capital requirements,” Christopher Wolfe, managing director and head of North American banks at Fitch Ratings, told CNBC.

    Consulting firm Klaros Group analyzed about 4,000 U.S. banks and found 282 banks face the dual threat of commercial real estate loans and potential losses tied to higher interest rates.

    The majority of those banks are smaller lenders with less than $10 billion in assets.

    “Most of these banks aren’t insolvent or even close to insolvent. They’re just stressed,” Brian Graham, co-founder and partner at Klaros Group, told CNBC. “That means there’ll be fewer bank failures. But it doesn’t mean that communities and customers don’t get hurt by that stress.”

    Graham noted that communities would likely be affected in ways that are more subtle than closures or failures, but by the banks choosing not to invest in such things as new branches, technological innovations or new staff.

    For individuals, the consequences of small bank failures are more indirect.

    “Directly, it’s no consequence if they’re below the insured deposit limits, which are quite high now [at] $250,000,” Sheila Bair, former chair of the U.S. Federal Deposit Insurance Corp., told CNBC.

    If a failing bank is insured by the FDIC, all depositors will be paid “up to at least $250,000 per depositor, per FDIC-insured bank, per ownership category.”

    Watch the video to learn more about the risk of commercial real estate, the role of interest rates on unrealized losses and what it may take to relieve stress on banks — from regulation to mergers and acquisitions.

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  • Why the Fed expects more bank failures

    Why the Fed expects more bank failures

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    Of about 4,000 U.S. banks analyzed by the Klaros Group, 282 banks face stress from commercial real estate exposure and higher interest rates. The majority of those banks are categorized as small banks with less than $10 billion in assets. “Most of these banks aren’t insolvent or even close to insolvent. They’re just stressed,” Brian Graham, Klaros co-founder and partner at Klaros. “That means there’ll be fewer bank failures. But it doesn’t mean that communities and customers don’t get hurt.”

    14:18

    Wed, May 1 202410:05 AM EDT

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  • SEC Lawyers Resign Following ‘Gross Abuse of Power’ in Crypto Case 

    SEC Lawyers Resign Following ‘Gross Abuse of Power’ in Crypto Case 

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    SEC lawyers Michael Welsh and Joseph Watkins resigned this month after the regulator was sanctioned by a federal judge in a crypto case against Digital Licensing Inc., otherwise known as DEBT Box.

    Judge Robert Shelby found that the SEC made false statements, misrepresentations, and lacked evidence in its case against the digital asset firm in which it alleged a $49 million crypto fraud scheme.

    The lawyers, who were lead attorneys in the DEBT Box case, were told by SEC officials that they would be terminated if they stayed, according to a Bloomberg report on April 22.

    SEC on The Backfoot Again

    Judge Shelby rebuked the SEC’s conduct, reversed an asset freeze on DEBT Box, and ordered the SEC to pay some of DEBT Box’s legal fees as a sanction. Additionally, the judge faulted arguments made by attorney Welsh and evidence provided by investigative attorney Watkins.

    In one instance, Welsh told the judge that DEBT Box was closing bank accounts and transferring assets overseas, but the court found that this wasn’t the case.  DEBT Box was among many crypto companies facing lawsuits last summer from the SEC for allegedly defrauding investors of nearly $50 million through the sale of unregistered securities.

    It is the latest setback for the federal regulator, which has lost a couple of high-profile crypto court decisions and still has several, including Coinbase and Ripple, in progress.

    “Gary G hanging on by a thread these days,” commented BlockWorks founder Jason Yanowitz.

    Ripple CEO Brad Garlinghouse said it feels appropriate that his firm files its response on the same day that two SEC lawyers “resign” for their (mis)conduct in the Debt Box case.

    “The US will be picking up the pieces of the agency’s disastrous policies long after Gensler is gone.”

    “Rotten cultures start at the top,” commented popular trader and investor, “DCinvestor.”

    More Dirty Laundry

    On April 23, ConsenSys product manager Jimmy Ragosa claimed to have been one of the SEC lawyers who resigned today.

    “I joined in 2023 and was in charge of leading the SEC meetings with ETH ETF issuers,” he said in an apparent parody before quipping:

    “My job was to stick my fingers in my ears and scream loudly every time they asked us how to make their application compliant.”

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    Martin Young

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  • SEC prosecutors quit after ‘abuse of power’ in DEBT Box case

    SEC prosecutors quit after ‘abuse of power’ in DEBT Box case

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    Two SEC lawyers, Michael Welsh and Joseph Watkins, have resigned from the agency due to “materially false and misleading representations” made in a crypto case last year.

    The pair were reportedly instructed to quit the securities regulator or be fired following their respective parts in the lawsuit against Digital Licensing Inc., commonly known as DEBT Box.

    Bloomberg first reported the news on April 22, citing unnamed sources familiar with the matter who confirmed that Welsh and Watkins bowed out from the U.S. SEC earlier this month. 

    The resignations came after Federal District Court Judge Robert Shelby reprimanded the SEC for abuse of power in the DEBT Box case, in which Welsh was the Commission’s primary attorney, and Watkins led the investigative team. 

    SEC vs. DEBT Box

    In July, DEBT Box and its founders were accused of stealing over $49 million from investors. Welsh and Watkins argued that the crypto firm was moving money offshore, petitioning Judge Shelby and the court to freeze assets. The motion was granted, and DEBT Box was placed in receivership as an extra measure. 

    However, Judge Shelby overturned his ruling after further evaluating the commission’s argument, which found that the duo made incorrect statements in court. The Director of the SEC’s Division of Enforcement, Gurbir Grewal, later apologized for apparent misconduct, while the court decided that DEBT Box was due monetary compensation to foot legal fees. 

    Following sanctions against the Wall Street watchdog, federal prosecutors motioned to dismiss the case without prejudice. As a result, DEBT Box is suing the regulator and seeking around $1.5 million in damages.


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    Naga Avan-Nomayo

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  • Ethereum Spot ETFs Approval Skepticism Persists, As ETH Recovers

    Ethereum Spot ETFs Approval Skepticism Persists, As ETH Recovers

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    Ethereum Spot Exchange-Traded Funds (ETFs) approval odds continue to witness notable pessimism as the cryptocurrency space awaits the United States Securities and Exchange Commission’s (SEC) decision on the products scheduled for May.

    The expectation surrounding the SEC’s decision highlights how important ETF approval is in terms of giving conventional investors more convenient access to Ethereum’s spot market. Presently, data from Polymarket, the world’s largest prediction market, shows that ETH ETF approval odds have fallen to a mere 11%.

    Pessimism Deepens As Ethereum ETFs Remain Uncertain

    As the May deadline draws near, doubt and skepticism loom large on the horizon, casting a dark shadow for the products. One of the most recent figures to voice doubts about the SEC’s willingness to approve the exchange-traded products this May is Nate Geraci, the president of ETF Store.

    According to Geraci, the regulatory watchdog is eerily silent on Ethereum spot ETFs. He further suggested that the products might not be approved due to the SEC’s significantly lower level of engagement with ETF issuers than in previous interactions.

    “Logic says that is correct, but also wonder if SEC learned a lesson from clown show with spot Bitcoin ETFs,” he added. Thus, he has pointed out two possible options for the products, which are either an approval or lawsuit from the Commission.

    Commenting on the president’s insights, a pseudonymous X user questioned if there is a possibility that activities are taking place behind closed doors in order to avoid disrupting the pre-launch market. Geraci responded, saying he believes that could be possible, drawing attention to Van Eck CEO Jan Van Eck’s review, which might prove otherwise.

    It is worth noting that Van Eck is one of the earliest firms to submit its application for an Ethereum exchange product. Even though the company was the first to file for an application, Jan Van Eck is pessimistic about the approval of the ETPs, saying they will probably be rejected in May.

    He stated:

    The way the legal process goes is the regulators will give you comments on your application, and that happened for weeks and weeks before the Bitcoin ETFs. And right now, pins are dropping as far as Ethereum is concerned.

    In light of this, investors prepare for an unpredictable result while managing market swings and modifying their investment plans in the face of changing regulations.

    ETH Price Sees Positive Movement

    While Ethereum ETFs might be experiencing negative sentiment, ETH, on the other hand, has witnessed a positive uptick lately. ETH has revisited the $3,000 level again after falling as low as $2,888 during the weekend.

    Today, ETH price rose by over 4%, reaching around $3,234, indicating potential for further price recovery. At the time of writing, Ethereum was trading at $3,215, demonstrating an increase of 1.40% in the past day.

    Also, the asset’s market cap and trading volume are up by 1.40% and 5.96% in the last 24 hours. Given the anticipated impact of the recently concluded Bitcoin Halving on cryptocurrencies, ETH could be poised for noteworthy moves in the coming months.

    ETH trading at $3,204 on the 1D chart | Source: ETHUSDT on Tradingview.com

    Featured image from iStock, chart from Tradingview.com

    Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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  • Important Ripple vs SEC Development, Bitcoin (BTC) Price Retreat, and More: Bits Recap April 18

    Important Ripple vs SEC Development, Bitcoin (BTC) Price Retreat, and More: Bits Recap April 18

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    TL;DR

    • After hitting a record high of around $73,800, Bitcoin (BTC) experienced a sharp correction to nearly $60,000. Despite the downturn, the upcoming halving on April 19 might trigger a bull run.
    • Ripple is gearing up for a trial against the US SEC set for April 23. This legal battle continues to capture attention, with significant updates expected soon.
    • Despite a recent 22% drop in its market value, Shiba Inu (SHIB) shows signs of potential recovery. Factors such as an increased burn rate and advancements in its layer-2 solution – Shibarium – may trigger a future rally.

    BTC’s Stubborn Correction

    The primary cryptocurrency stole the show in March, with its price rising to a new all-time high of approximately $73,800 and trading above the $70K mark for a while. However, the start of this month offered a severe correction, which intensified in the last few days.

    As CryptoPotato reported, the asset’s value plunged to nearly $60,000 on April 17, triggering over $200 million in liquidations.

    Some factors that might stand behind BTC’s downfall lately could be reports hinting that the US Fed may raise interest rates in the world’s largest economy instead of pivoting from its aggressive anti-inflationary policy. The escalating tension between Israel and Iran and fears of another war might also have contributed to the decline, which affected traditional finance, too.

    Still, numerous optimistic elements are signaling that Bitcoin’s retreat may soon be replaced by a bull run, with the upcoming halving being the most obvious one. Following the event, scheduled for April 19, rewards distributed to miners for validating blocks on the BTC blockchain will be slashed in half.

    This decreases the amount of coins entering the market, making them scarcer and potentially more valuable in time (assuming demand increases or stays the same).

    Historically, each halving in the past was a precursor for a significant resurgence of the entire cryptocurrency sector. Those curious to learn more about the event and prepare for it, feel free to take a look at our dedicated video below:

    Ripple vs. SEC

    Perhaps the most important news circulating around Ripple lately are the updates related to the lawsuit against the United States Securities and Exchange Commission (SEC).

    Earlier this week, several X users assumed a settlement between the entities might be just around the corner due to a final pretrial conference held before Judge Netburn on April 16.

    Nonetheless, Stuart Alderoty – Chief Legal Officer of Ripple – said Ripple and the SEC await the start of the trial (set for April 23), rejecting the option of a mutual agreement before that date. He also clarified that the firm will file its response to the regulator’s request for penalties by April 22, whereas the Commission’s reply should come by May 6.

    Is SHIB Poised for a Rally?

    Shiba Inu – the second-largest meme coin by market capitalization – is among the worst-affected cryptocurrencies during the ongoing crash, with its price dropping by 22% on a weekly scale. 

    Essential indicators, though, hint it may return to green territory soon. Such factors include the asset’s burn rate increase, the advancement of the layer-2 scaling solution Shibarium, and the negative SHIB exchange netflow.

     

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  • Donald Trump Poses a Unique Threat to Truth Social, Says Truth Social

    Donald Trump Poses a Unique Threat to Truth Social, Says Truth Social

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    Trump Media & Technology Group, the Truth Social parent company majority-owned by former president Donald Trump, filed a document with the Securities and Exchange Commission this morning that helpfully details all of the ways Trump himself poses a threat to the company and its shareholders.

    While the company generated just over $4 million in revenue in 2023, Trump Media’s valuation has fluctuated wildly since going public in March, at one point reaching more than $7 billion. As of this morning, the company was valued at $3.7 billion. Trump Media has become a meme stock, where the stock price is governed more by vibes than traditional financial performance.

    The SEC document filed by Trump Media this morning, which announced the public stock offering of 21.5 million shares, also detailed the company’s “risk factors.” These statements are standard for publicly traded companies, and usually include anything from macroeconomic headwinds to worst-case scenarios like earthquakes or terrorist attacks. The filing does include several risk factors that aren’t directly related to Trump, including competition from other social media companies, deficiencies in bookkeeping and accounting, and data privacy laws. And the company has faced multiple lawsuits from early employees of the company, who argue they deserve more shares.

    But an entire section is dedicated to Trump-associated risks, making Truth Social’s risk factors unique because they cast Trump’s role as chief promoter and majority shareholder as a threat to the company’s success.

    “TMTG may be subject to greater risks than typical social media platforms because of the focus of its offerings and the involvement of President Donald J. Trump,” the company said in the SEC filing. “These risks include active discouragement of users, harassment of advertisers or content providers, increased risk of hacking of TMTG’s platform, lesser need for Truth Social if First Amendment speech is not suppressed, criticism of Truth Social for its moderation practices, and increased stockholder suits.”

    Here’s how Trump Media says Trump himself could threaten the company:

    Trump’s Legal Issues

    Trump Media noted that if Trump “were to discontinue his relationship with TMTG due to death, disability, criminal conviction, incarceration, or any other reason, or limit his involvement with TMTG due to his ongoing candidacy for political office, TMTG would be significantly disadvantaged.”

    Trump’s History of Bankruptcy

    “Entities associated with President Donald J. Trump have filed for bankruptcy protection in the past,” the company said in the filing, which noted that the Trump Taj Mahal, Trump Plaza, the Trump Castle, the Plaza Hotel, and Trump Entertainment Resorts Inc. had all previously filed for bankruptcy.

    “While all of the foregoing were in different businesses than TMTG, there can be no guarantee that TMTG’s performance will exceed the performance of those entities,” the filing said.

    Other Companies Refusing to Work With Truth Social

    “To date, several potential third-party partners have expressed an unwillingness or reluctance to work on TMTG’s products or provide services for reasons including TMTG’s connection with President Donald J. Trump,” the filing stated.

    Trump’s Use of Other Platforms

    The company warned that if Trump stopped using Truth Social, its business would be adversely affected.

    Trump has an agreement to post all content he deems as “nonpolitical” to Truth Social first, and must wait six hours before posting it on any website. But Trump, as a political candidate, may be able to argue that anything he posts is political content, meaning the company doesn’t have much power if he wants to start tweeting again.

    “Consequently, TMTG may lack any meaningful remedy if President Donald J. Trump minimizes his use of Truth Social,” the filing states.

    Politically Motivated Hackers

    Trump’s involvement makes the company a prime target for hackers, according to the filing.

    “TMTG believes that it is a particularly attractive target for such breaches and attacks, including from nation states and highly sophisticated, state-sponsored, or otherwise well-funded actors,” the company said in the filing. “And TMTG may experience heightened risk from time to time as a result of geopolitical events.”

    Trump’s Self-Interest

    Trump, who owns 57.6 percent of Trump Media, could steer the company to his benefit in a way that might not align with other Trump Media investors.

    “President Donald J. Trump will, as a controlling stockholder, be entitled to vote his shares in his own interests, which may not always be in the interests of TMTG’s stockholders generally,” the filing says.

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    William Turton

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  • SEC serves Wells notice to Uniswap

    SEC serves Wells notice to Uniswap

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    Defi exchange Uniswap has received a warning of an impending enforcement action enacted by the U.S. SEC.

    On April 10, Uniswap disclosed a Wells notice issued by the SEC’s Enforcement Division. The notice is part of a broader crackdown on crypto by the securities watchdog, as chair Gary Gensler insists that most digital assets issued on blockchains fall under existing financial laws.

    Gensler has often referred to crypto as the “Wild West” and has sought to reign in the industry through enforcement action. 

    Uniswap founder reacts

    Uniswap founder and CEO Hayden Adams wrote on X that he was annoyed and disappointed but ready to fight the SEC and protect his company.

    In a blog post discussing the SEC’s notice, Uniswap also refuted claims that most cryptocurrencies constitute investment contracts. Like several in the industry, including Coinbase, the DEX argued that the overwhelming volume of traded tokens is stablecoins, utility tokens, and commodities like Bitcoin (BTC) and Ethereum (ETH).

    “Despite SEC rhetoric that “most” tokens are securities, the reality is that tokens are a digital file format, like a PDF or spreadsheet, and can store many kinds of value. They are not intrinsically securities, just as every sheet of paper is not a stock certificate. We are confident that the products we offer are not just legal – they are transformative.”

    Uniswap’s April 10 blog post

    According to DefiLlama, Uniswap is the largest defi exchange and holds over $6.2 billion in total value locked across 16 individual blockchains. CoinGecko data showed that the DEX handles 22.5% of all cryptocurrency trading volume.

    Following the news, the UNI token declined by over 9% and traded for around $10, per CoinMarketCap.

    Uniswap’s token price | CoinMarketCap


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    Naga Avan-Nomayo

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  • SEC Delays Decision on NYSE Proposal for Spot Bitcoin ETF Options Trading

    SEC Delays Decision on NYSE Proposal for Spot Bitcoin ETF Options Trading

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    The United States Securities and Exchange Commission (SEC) has postponed its decision on the New York Stock Exchange’s proposal to introduce option trading on spot Bitcoin exchange-traded funds (ETFs).

    Grayscale Bitcoin Trust and Bitwise Bitcoin ETF are directly affected since they hold BTC on the NYSE.

    SEC Delays Decision on Spot BTC ETF Options Trading

    The SEC cited in its April 8 filing that it will require a longer time to take action on the suggested rule change so that it has enough time to deliberate on it. Notably, the next deadline for the SEC to delay, approve, or deny the proposed rule change is May 29.

    The rule change proposal was submitted to the SEC in February 2024, after which it was opened for public feedback. The proposal would allow trading options on certain Bitcoin ETFs by changing Rule 915.

    Options are financial derivatives that allow investors to speculate on the movement of underlying assets, bringing about hedging and leverage.

    The same delay decision for Grayscale and Bitwise was given for Nasdaq’s request for options trading on BlackRock’s iShares Bitcoin Trust (IBIT) last month.

    In an earlier March 6 filing, the regulator also delayed responding to the CBOE exchange and the Miami International Securities Exchange requests to offer spot Bitcoin ETFs options.

    Grayscale CEO Urges SEC for Spot Bitcoin ETF Options

    Michael Sonnenshein, the Grayscale CEO, was one of the two people who approached the SEC with a request to have the rule changed on options trading.

    In a letter on February 28, Sonnenshein said it only made sense for the SEC to approve options trading on the spot Bitcoin ETFs since the regulator already approved futures and spot ETFs on the NYSE.

    In a February 5 post, Sonnenshein wrote that options for spot Bitcoin ETFs could lead to a “robust and healthy market.”

    Meanwhile, the SEC is still deliberating on the seven spot Ethereum ETFs after postponing the decision until May 23, the same deadline set for the VanEck ETF application.

    Spot Bitcoin ETFs have been on an upward trend this year, attracting attention beyond the United States. Recently, Chinese mainland-based equity funds filed applications to introduce spot Bitcoin ETFs through their Hong Kong subsidiaries. One of the funds, Harvest Fund Management’s Hong Kong branch, has been awaiting approval from the Securities & Futures Commission (SFC) of Hong Kong since January.

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  • Bloomberg Analyst: Ethereum ETF has no positive signs

    Bloomberg Analyst: Ethereum ETF has no positive signs

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    Bloomberg Senior ETF Analyst Eric Balchunas was cautious about the likelihood of spot Ethereum ETF approval, estimating the chances at a pessimistic 25%.

    “The lack of engagement seems to be purposeful vs procrastination. No positive signs/intel anywhere you look,” Balchunas said on X, pointing out the SEC’s apparent strategic non-engagement.

    The debate extends beyond mere speculation, with industry stakeholders offering insights into the SEC’s process. Craig Salm, Grayscale’s Chief Legal Officer, offered a contrasting perspective on the same social media platform. Salm suggested that the SEC’s silence might not inherently signal disapproval and noted that the groundwork laid during the approval process for a spot Bitcoin ETF could influence the current situation.

    “In the final months leading up to Bitcoin ETF approval, Grayscale and others received positive and constructive engagement from the SEC,” Salm said.

    The Grayscale representative emphasized that the core issues addressed for Bitcoin ETFs, such as creation/redemption procedures and custody concerns, apply equally to Ether, suggesting a baseline of engagement has already been established.

    During discussions on the topic, there was an undercurrent of concern regarding the SEC’s stance on Ether classification. Reports indicate the regulator has issued subpoenas to crypto firms on interactions with the Ethereum Foundation, hinting at a possible intention to classify Ether as a security.

    Alex Thorn, head of firmwide research at Galaxy Digital, views these developments as making the approval of spot Ether ETFs soon “extremely unlikely.”


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  • Coinbase chief lawyer urges SEC to approve Ethereum ETFs

    Coinbase chief lawyer urges SEC to approve Ethereum ETFs

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    The SEC has no compelling reason to reject applications to launch an Ethereum ETF, says Coinbase chief legal officer Paul Grewal.

    In his X post, Grewal revealed vital facts about Ethereum, highlighting its widespread adoption among millions of Americans since its inception in 2015 and its integral role in the cryptocurrency ecosystem.

    According to the Coinbase lawyer, the SEC has treated Ethereum (ETH) as a commodity, not a security, for many years. The CFTC and federal courts have unanimously confirmed that the asset has this status.

    Coinbase‘s lawyer referred to statements made by the agency’s director of corporate finance, William Hinman, in 2018. He also recalled SEC Chair Gary Gensler’s speech in front of Congress before he was appointed head of the commission. In his remarks, Gensler took a similar position.

    Grewal stressed that Ethereum needs to meet the criteria of the Howey test, which defines securities. He pointed to consistency in the asset’s oversight, including its listing on CFTC-regulated futures exchanges starting in 2021.

    In light of the established regulations, Grewal urged the SEC not to create unnecessary barriers to approving spot Ethereum ETFs. He emphasized that doubts about ETH’s regulatory status contradict a long-standing precedent and could undermine investor confidence.

    “Digital assets like ETH that do not involve an ongoing contractual obligation related to a business enterprise are not “investment contracts” or otherwise “securities.”

    Paul Grewal, Coinbase chief legal officer

    Grewal’s comment came in response to the regulator’s decision on March 20 to postpone the verdict on VanEck’s Ethereum ETF application. The department has extended the review period until May 23 and asked for public comments. Previously, the Commission came to similar conclusions based on similar proposals.

    Franklin Templeton, BlackRock, Fidelity, and Invesco with Galaxy are also participating in the race to launch an ETF based on ETH.


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    Anna Kharton

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