Fidelity Investments has filed registration of securities with the SEC for its spot Bitcoin ETF.
With over $4.5 trillion in assets, the firm has filed Form 8-A with the U.S. Securities and Exchange Commission (SEC) to register its Fidelity Wise Origin Bitcoin Fund. This filing indicates a move to make the fund a publicly traded security, a milestone for Fidelity and the broader acceptance of digital assets in traditional investment portfolios.
Fidelity’s Form 8-A filing | SEC
The filing comes at a turbulent time, as the crypto market lost over $540 million in liquidation today due to Matrixport claiming the SEC might reject all ETF applications. However, several journalists and analysts have refuted such claims shortly after.
SEC Form 8-A is a critical regulatory requirement for companies intending to list securities on an exchange. This registration underlines Fidelity’s commitment to adhering to regulatory standards, paving the way for its spot Bitcoin exchange-traded fund (ETF) to be offered on a national securities exchange.
As specified in the form, the listing on the CBOE BZX Exchange is a clear signal that Fidelity is positioning itself at the forefront of the ETF investment wave. With this registration, Fidelity’s Bitcoin fund is now subject to the rules and oversight designed by the SEC to protect investors and maintain fair markets, underlining the fund’s legitimacy.
The SEC is holding meetings today with major exchanges, including the New York Stock Exchange, Nasdaq, and the Chicago Board Options Exchange (CBOE), regarding spot Bitcoin ETFs.
The information was revealed by a Fox Business journalist earlier today, bringing some sense of relief for the wider crypto community after crypto services firm Matrixport reported that the SEC would likely reject all ETF applications in January. This report triggered a major liquidation in today’s market, as the crypto market lost more than $540 million in just four hours.
🚨SCOOP: The @SECGov is holding meetings today with the exchanges (@Nasdaq, @CBOE, @NYSE) to finalize comments on the 19b-4s submitted by the $BTC Spot ETF issuers.
Despite Matrixport’s report of a possible denial, Bloomberg’s analysts have claimed that no substantial evidence pointing towards a rejection of the ETFs has been reported.
People tagging me like crazy on this “rejection” report. We have heard nothing to indicate anything but approval but I want to give the guy benefit of doubt so I’m asking if he has any sources or if he just speculating. He seems to be bitcoin bull and recently tweeted… https://t.co/KV7k4NXtba
There was a brief debate on X between Bloomberg analyst Eric Balchunas and Matrixport’s Markus Thielen, who published the potential ‘rejection’ report. Thielen clarified that the report wasn’t based on any comments from SEC insiders or the ETF applications. However, he cited consensus among researchers to reach this prediction and has turned bearish on Bitcoin.
My report is not based on issuer, nor on SEC insider comments. Obviously this is massively out of consensus. I do think the SEC will vote it down. And yes, after being the biggest bull all year (predicted 45k by Xmas on Feb 1), I turned bearish today but the arguments were ready
However, today’s meeting suggests a more optimistic outlook, aligning with broader market expectations of a possible approval by the SEC, potentially as soon as the following week. Jan. 10th has been identified as a critical date, marking a deadline for the numerous spot Bitcoin ETF applicants.
Disclosure: The views and opinions expressed here belong solely to the author and do not represent the views and opinions of crypto.news’ editorial.
Conspiracy theorists aren’t surprised. They knew all along that central banks and governments would never allow a competitor to fiat money to exist. Even some regulators knew. For instance, Brian Brooks, former head of the Office of the Comptroller of the Currency, an independent bureau of the U.S. Department of the Treasury, has intonated as much.
Regulators put a thaw over the entire US-based crypto industry. The Securities and Exchange Commission (SEC) enforced actions against regulated US crypto entities, including Kraken and Coinbase, while the Commodity Futures Trading Commission (CFTC) sued Binance.
When the SEC came for Kraken a second time, founder and former CEO Jesse Powell took to Twitter to lament the implications.
Message is clear: $30m buys you about 10 months before the SEC comes around to extort you again. Lawyers can do a lot with $30m but the SEC knows that a real fight will likely cost $100m+, and valuable time. If you can’t afford it, get your crypto company out of the US warzone.
Moreover, a Wells Notice was served in February to Paxos demanding the New York-based company stop minting the Binance USD (BUSD) stablecoin.
Then there is the “Economic Report of the President,” in which the Biden Administration argued that cryptocurrency is not a useful technology while highlighting the pervasive fraud of the industry.
Some players within the crypto industry pointed to these three bank failures as evidence of a conspiracy by federal agencies to destroy crypto—some have called it the new Operation Choke Point. In fact, even former Congressman Barney Frank has suggested that the bank for which he serves on the board, Signature, was shut down as part of an anti-crypto crusade. Frank served as a board member of Signature Bank. He believes the bank was forced into liquidation by the New York Department of Financial Services (NYDFS) because “regulators wanted to send a very strong anti-crypto message.”
NYDFS denies Frank’s allegation. Reuters reported the Federal Deposit Insurance Corp. (FDIC) would require any buyer of Signature Bank to restrict crypto clients’ banking services. Despite the fact that the FDIC denied buyers would forgo crypto clients, such clients were not included in the acquisition.
Notably, the present head of the FDIC is Martin Gruenberg, an architect of the original Operation Choke Point, which was met with lawsuits and hearings that concluded the US government abused its power. The FDIC made promises about reforms, which now seem to ring empty.
When regulators shut down Signature Bank, its managers were themselves surprised at the decision to place the bank into receivership. As Barney Frank, a Signature Bank board member known for the widespread banking regulation Dodd-Frank Act enacted in the aftermath of the 2008 financial crisis, noted:
“I think that if we’d been allowed to open tomorrow, that we could’ve continued—we have a solid loan book, we’re the biggest lender in New York City under the low-income housing tax credit. I think the bank could’ve been a going concern.”
Frank also said: “This was just a way to tell people, ‘We don’t want you dealing with crypto.” Frank, who chaired the House Financial Services Committee after the global financial crisis, went on to state at the time that there was “no real objective reason” that Signature had to be seized. He blames his bank’s shutdown on panic around cryptocurrency. He said: “We became the poster boy because there was no insolvency based on the fundamentals.” Frank added:
“The FDIC and the state of New York looked at things and made their decision. Frankly, I was surprised by it. They apparently had a more negative view of our solvency.”
Frank doesn’t think SVB nor his bank would have collapsed if FTX had not collapsed last year. It set off a panic that has yet to subside. The claimed justification for shutting down Signature was its Signet product, which was viewed as “systemic.” Signature’s asset portfolio, however, was nowhere near as bad as SVB’s. Regardless, as of this year, crypto’s three largest banking partners are now history.
2023 wasn’t all bad for the US crypto industry, as the US judicial branch pushed back some against agencies such as the SEC, even accusing the agency of engaging in deception. Nonetheless, it appears the damage had been done in many ways.
It seems clear now that the US government poses an existential threat to the nation’s cryptocurrency industry. It came for the industry in 2023, and 2024 might be more similar. Indeed, founders and established companies think the grass looks greener on the other side in jurisdictions where their right to innovation is respected. That’s a bloody shame for the so-called “land of the free” and the crypto industry as a whole.
Kadan Stadelmann
Kadan Stadelmann is the chief technology officer of Komodo, an open-source technology provider and creator of AtomicDEX, a cryptocurrency wallet and decentralized exchange rolled into one dApp. Kadan is also a blockchain developer and operations security expert who previously worked in IT for the Austrian and Tunisian governments.
A U.S. circuit court in Washington D.C. has ordered the Securities and Exchange Commission to revisit its rejection of a Bitcoin ETF application by crypto hedge fund Grayscale.
But that doesn’t mean the SEC won’t find new reasons to reject it or any of the dozen other applications.
SEC Rejection or Delay Could Tank Bitcoin Price
Crypto industry investors and insiders expect the price of Bitcoin and other crypto assets to surge if and when the SEC approves an exchange-traded fund for BTC. “It’s definitely going to pump quickly,” said DeCryptoFi founder and CEO Nicholas Scherling at a recent round table with Rob Nelson for TheStreet.
By the same token, however, news of any Bitcoin ETF rejections by the SEC could lead to a rout in Bitcoin price. In fact, ETF Store president and ETF Institute co-founder Nate Geraci warned Sunday that if the SEC doesn’t approve a Bitcoin ETF in January, markets could see one of the “bigger rug pulls in crypto history.”
If spot bitcoin ETF not approved in January, might be one of bigger rug pulls in crypto history…
Not my base case, but can’t entirely rule out given history here (which is why I said *close* to 100%).
That said, sticking w/ my original pre-Grayscale court victory prediction. https://t.co/zhlLDgMlzw
The SEC shows no signs of making it easy for institutional financiers who want to launch a Bitcoin ETF. It has so far rejected “in-kind” structured ETFs and insisted on “cash create” ETFs by issuers. The form the SEC is insisting on will raise tax liabilities for issuers and perhaps fees for clients. The battle between funds and regulators could delay an ETF past January.
Spot Bitcoin ETF Threat to Crypto Exchanges
Referring to the average 0.01% fee for ETF trading on a Sunday, Dec. 17 post to X, senior Bloomberg ETF analyst Eric Balchunas quipped that a Bitcoin ETF is about to “unleash the Power of One (basis point). Nate Geraci replied that it will “be a bloodbath for crypto exchanges.”
Let’s check this 6mos after spot bitcoin ETFs launch…
By contrast, crypto trading fees on popular crypto exchanges like Coinbase can go as high as 0.6%. Balchunas believes a crypto ETF will wipe out high trading fees for the original cryptocurrency. However, that would most likely be a net financial benefit for investors.
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BlackRock revises spot Bitcoin ETF to enable easier access for banks
BlackRock has revised its spot Bitcoin exchange-traded fund (ETF) application to make it easier for Wall Street banks to participate by creating new shares in the fund with cash rather than just crypto. The new in-kind redemption “prepay” model will allow banking giants such as JPMorgan or Goldman Sachs to act as authorized participants for the fund, letting them circumvent restrictions that prevent them from holding Bitcoin or crypto directly on their balance sheets.
El Salvador expects to sell out Bitcoin ‘Freedom Visa’ by end of year
El Salvador’s National Bitcoin Office says its $1 million Freedom Visa program has already received hundreds of inquiries since its launch on Dec. 7 and expects it to sell out before the end of 2023. Launched by the local government in partnership with stablecoin issuer Tether, the Freedom Visa is a citizenship-by-donation program that grants a residency visa and pathway to citizenship for 1,000 people willing to make a $1 million Bitcoin or Tether donation to the country. The program is limited to 1,000 slots per calendar year.
Sam Bankman-Fried’s lawyer says FTX fraud trial was “almost impossible” to win: Report
The lawyer responsible for Sam “SBF” Bankman-Fried’s criminal trial defense has admitted that the case was “almost impossible” to win from the outset. During an interview, Stanford Law School professor David Mills said he recommended the legal defense of SBF admit to the allegations of witnesses and state prosecution and convince the jury that Bankman-Fried intended to save the company. Mills also disclosed that he had agreed to lend his expertise to Bankman-Fried’s defense at the behest of the FTX CEO’s parents, and described Bankman-Fried “as the worst person I’ve ever seen do a cross-examination.”
Yearn.finance pleads arb traders to return funds after $1.4M multisig mishap
Yearn.finance is hoping arbitrage traders will return $1.4 million in funds after a multisignature scripting error resulted in a large amount of the protocol’s treasury being drained. The error occurred while Yearn was converting its yVault LP-yCurve — earned from performance fees on vault harvests — into stablecoins on the decentralized exchange CoW Swap. Yearn suffered significant slippage when it received 779,958 DAI yVault tokens from the trade, resulting in a 63% drop in the liquidity pool value.
SEC pushes deadline for decision on Invesco Galaxy spot Ethereum ETF to 2024
The United States Securities and Exchange Commission has delayed its decision on whether to approve or reject a spot Ether ETF proposed by Invesco and Galaxy Digital. The companies filed the spot ETH ETF application in September. The proposed spot crypto investment vehicle is one of many being considered by the commission, which, to date, has never approved an ETF with direct exposure to Ether, Bitcoin or other cryptocurrencies.
Winners and Losers
At the end of the week, Bitcoin (BTC) is at $42,222, Ether (ETH) at $2,250 and XRP at $0.62. The total market cap is at $1.6 trillion, according to CoinMarketCap.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Bonk (BONK) at 131.38%, WOO Network (WOO) at 78.34% and Helium (HNT) at 77.66%.
The top three altcoin losers of the week are Terra Classic (LUNC) at -15.84%, Sei (SEI) at -14.48% and Pepe (PEPE) at -12.10%.
‘No excuse’ not to long crypto: Arthur Hayes repeats $1M BTC price bet
Bitcoin and altcoins are a no-brainer bet in the current macro climate, Arthur Hayes says. In a post on X (formerly Twitter) on Dec. 14, the former CEO of exchange BitMEX said that investors have “no excuse” to short crypto.
Going long on crypto is the key to success as markets bet on the United States Federal Reserve lowering interest rates next year, Hayes argues. “At this point, there is no excuse not to be long crypto,” part of his post stated.
“How many more times must they tell you that the fiat in your pocket is a filthy piece of trash,” he wrote. Hayes further reiterated a longstanding $1 million BTC price prediction as a result of macro tides eroding the value of national currencies.
FUD of the Week
Ledger patches vulnerability after multiple DApps using connector library were compromised
The front end of multiple decentralized applications using Ledger’s connector were compromised on Dec. 14. Ledger announced that it had fixed the problem three hours after the initial reports about the attack. Protocols affected include Zapper, SushiSwap, Phantom, Balancer and Revoke.cash, stealing at least $484,000 in digital assets. The attacker utilized a phishing exploit to gain access to the computer of a former Ledger employee. The hack sparked criticism about Ledger’s security approach.
Bitcoin inscriptions added to US National Vulnerability Database
The National Vulnerability Database flagged Bitcoin’s inscriptions as a cybersecurity risk on Dec. 9, calling attention to the security flaw that enabled the development of the Ordinals Protocol in 2022. According to the database records, a datacarrier limit can be bypassed by masking data as code in some Bitcoin Core and Bitcoin Knots versions. As one of its potential impacts, the vulnerability could result in large amounts of non-transactional data spamming the blockchain, potentially increasing network size and adversely affecting performance and fees.
SafeMoon falls 31% in five hours after filing for Chapter 7 bankruptcy
The token of decentralized finance protocol SafeMoon has fallen 31% in five hours after the company behind it filed for bankruptcy. SafeMoon officially applied for Chapter 7 bankruptcy, also known as “liquidation bankruptcy,” on Dec. 14. The latest blow comes only a month after the U.S. Securities and Exchange Commission charged SafeMoon and its executives with violating securities laws in what the regulator described as “a massive fraudulent scheme.” Several former SafeMoon supporters expressed frustration on Reddit regarding the bankruptcy, alleging they were rug-pulled by the SafeMoon developers.
In their latest meeting, SEC and BlackRock reportedly discussed the iShares Bitcoin ETF on Dec. 14, raising questions about in-kind transactions.
Unlike previous meetings, James Seyffart, a Bloomberg Intelligence analyst, reports that there were no presentations.
As part of a follow-up thread on X, Seyffart reminds the community that Hashdex, another firm in the spot Bitcoin ETF race, had also engaged with SEC’s Office of the Chair.
After this, a community member asked Seyffart about the likelihood of SEC approval, given Chairman Gary Gensler’s comment on listening to the courts from yesterday.
I mean. We’ve been at 90% odds since October when people told us we were insane for thinking it was gonna happen!! haha. Now people want us to increase the odds. But yes — we think its happening. https://t.co/bLO8qcchj3
“Yes – we think it’s happening,” was the Bloomberg analyst’s response.
The application had been revised following a third meeting between BlackRock representatives and the SEC led by Gensler on Dec. 11, with prior engagements occurring on Nov. 20 and 28.
The SEC still must hold to the deadline of Jan. 15 to make a decision on BlackRock’s application, with a final cutoff on Mar. 15. Grayscale, Bitwise, VanEck, WisdomTree, Invesco Galaxy, Fidelity, and Hashdex are also awaiting the SEC’s decision.
After consistently denying approval for a spot Bitcoin ETF for American investors over the years, there are indications that SEC chair Gary Gensler might be reconsidering his position in light of Grayscale’s legal triumph.
While he has not explicitly acknowledged any change in stance, he admitted taking a new look at the approval process of a spot Bitcoin ETF following the recent court rulings.
Softening Stance?
In an interview with CNBC’s “Money Movers,” Gensler said,
“I think it’s between eight and a dozen filings. I’m chair of a commission. I’m not to prejudge anything. So, that’s going through the process right now. And as you might know, we had in the past denied a number of these applications, but the courts here in the District of Columbia weighed in on that. And so we’re taking a new look at this based upon those court rulings.”
The District of Columbia Court of Appeals in Washington in August ruled that the SEC made an incorrect decision in denying approval for Grayscale’s proposed Bitcoin ETF. This ruling held significant importance for the industry, which has been seeking for a decade to progress and establish such crypto investment products.
Despite the hostility towards the sector, the SEC opted against appealing the court decision. This decision subsequently led to speculation that it may open the door for the regulatory agency to reconsider and assess Grayscale’s application.
In the latest interview, Gensler refrained from mentioning Grayscale but emphasized the SEC’s role in operating within the framework of laws established by Congress and interpreted by the courts. He also cautioned investors about prevalent noncompliance with securities laws designed to provide disclosure for informed investment decisions and protect against fraud and manipulation.
Besides Grayscale, several major asset management firms, including BlackRock, Fidelity, Invesco, VanEck, and Valkyrie, are currently competing to introduce a spot Bitcoin ETF. Although the approval process for all these applications has experienced delays, experts are confident approval is likely to take place in early January 2024.
Grayscale Optimistic Following Conversations With SEC
Grayscale has been eagerly eyeing a spot Bitcoin ETF after securing a court win against the SEC.
While specific timelines have not been disclosed, Michael Sonnenshein, the CEO of Grayscale Investments, expressed positivity regarding discussions with the SEC regarding the possibility of a spot Bitcoin ETF. The exec shared his optimism, stating that his firm has been actively involved in conversations with the regulatory watchdog.
He noted that the questions posed by the SEC suggest a willingness to engage on the matter and a desire to make advancements in this area.
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U.S. Securities and Exchange Commission Chair Gary Gensler indicated a possible change in the agency’s approach towards Bitcoin ETFs.
During a CNBC interview, Gensler revealed that the U.S. Securities and Exchange Commission (SEC) is reconsidering “between eight and a dozen filings” for spot Bitcoin ETFs, a move influenced by recent court decisions in the District of Columbia.
🇺🇲 SEC Chair Garry Gensler commented on @CNBC about SPOT #Bitcoin ETF.
How they have been denying a dussin of these ETFs in the past, but now BlackRock… I mean Courts in DC have intervened and now the SEC have to reprocess these ETF applications again. 😅
Historically, the SEC has hesitated to approve such proposals, citing various concerns. However, Gensler hinted at a shift, attributing it to judicial input. While he avoided directly referencing the Grayscale case, the context suggests a connection. Earlier this year, Grayscale won a legal battle against the SEC, leading to a reassessment of its application to convert its Bitcoin trust into an ETF. This decision was not appealed by the SEC.
Grayscale’s progress, alongside others rooting for ETF approval, has stirred optimism in the market. Bloomberg analysts James Seyffart and Eric Balchunas noted ongoing discussions between the SEC and Grayscale, indicating a collaborative effort toward regulatory compliance.
The race for a Bitcoin ETF has attracted diverse players, including major asset managers like BlackRock. With the SEC set to decide on ARK and 21Shares’ proposal by Jan. 10, anticipation is high. Bloomberg analysts estimate a 90% chance of approval, though skeptics like former SEC staffer John Reed Stark deem such optimism “absurd.”
The US Securities and Exchange Commission (SEC) has extended its decision on whether to approve or disapprove a spot Ethereum exchange-traded fund (ETF) application by investment management company Invesco and crypto financial services firm Galaxy Digital.
The SEC gave a 45-day extension, allowing itself until February 6, 2024, to make its decision on the product.
Another Spot Ethereum ETF Delay
According to a notice published on Dec. 13, 2023, the SEC’s initial decision on the Invesco Galaxy spot Ethereum ETF was supposed to happen on Dec. 23, 2023, which would have been the 45th day after publication of the notice for the product.
While the extension is coming earlier than expected, the SEC is designating another 45 days to decide if it would approve or disapprove the spot ETH application, with the new date falling on Feb. 4, 2024.
An excerpt from the notice reads:
“The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein.”
The SEC further stated:
“Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act, designates February 6, 2024, as the date by which the Commission shall either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change.”
The latest delay comes shortly after the American regulator recently extended its decision on another spot Ethereum ETF proposed by crypto asset manager Grayscale Investments, with the new deadline falling on Jan. 25, 2024.
So far, there are seven spot ETH ETF filings before the SEC. In addition to Grayscale Investments and Invesco/Galaxy, Fidelity, BlackRock, VanEck, Hashdex, and Ark Invest/21 Shares filed similar applications with the Commission.
The US Still Awaiting a Spot Crypto ETF
Apart from delaying spot ETFs focused on Ethereum, the SEC has also designated longer periods to spot Bitcoin ETFs, which have more applicants.
Meanwhile, there were recent reports that the conversations about spot Bitcoin ETFs with the Commission were reportedly in advanced stages, sparking hope about the potential approval of applications.
The race for the launch of a spot BTC ETF intensified in mid-2023, with heavyweights such as BlackRock, Franklin Templeton, and Fidelity looking to launch a spot Bitcoin ETF.
Digital asset manager Hashdex, which is also seeking approval for its spot BTC ETF filing, predicted that US investors could get access to such a product by the second quarter of 2024, followed by a spot Ether ETF.
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Binance founder CZ must stay in US until sentencing, judge orders
Binance founder Changpeng “CZ” Zhao has been ordered to stay in the United States until his sentencing in February, with a federal judge determining there’s too much of a flight risk if the former crypto exchange CEO is allowed to return to the United Arab Emirates. On Dec. 7, Seattle District Court Judge Richard Jones ordered Zhao to stay in the U.S. until his Feb. 23, 2024 sentencing date. He faces up to 18 months in prison after pleading guilty to money laundering on Nov. 21 and has agreed not to appeal any potential sentence up to that length.
House committee passes bill to ‘preserve US leadership’ in blockchain
A United States Congress committee has unanimously passed a pro-blockchain bill, which would task the U.S. commerce secretary with promoting blockchain deployment and thus potentially increase the country’s use of blockchain technology. The act covers an array of actions the commerce secretary must take if passed, including making best practices, policies and recommendations for the public and private sector when using blockchain tech. The bill will now go to the House for a vote. If passed, it must also pass in the Senate before returning for final congressional and presidential approval.
SEC pushes deadline to decide on Grayscale spot Ether ETF
The United States Securities and Exchange Commission has delayed its decision on whether to approve or reject a spot Ether exchange-traded fund (ETF) offering from asset manager Grayscale. In a notice, the SEC said it would designate a longer period for considering a proposed rule change that would allow NYSE Arca to list and trade shares of the Grayscale Ethereum Trust. Grayscale first filed with the SEC to convert shares of its Grayscale Ethereum Trust into a spot Ether ETF in October, adding its name to the list of companies awaiting a decision from the regulator.
Elon Musk’s xAI files with SEC for private sale of $1B in unregistered securities
Elon Musk’s X-linked artificial intelligence modeler, xAI, has an agreement for the private sale of $865.3 million in unregistered equity securities, according to a filing with the United States Securities and Exchange Commission made on Dec. 5. The company is seeking to raise $1 billion. XAI’s product, a chatbot called Grok, has recently rolled out to X’s Premium+ subscribers. Musk announced the launch of xAI in July and claimed its goal was to “understand the universe.”
Bitcoin new high set for late 2024, Binance to lose top spot — VanEck
Bitcoin will hit a new all-time high in late 2024 because of a long-feared United States recession and regulatory shifts after the next U.S. presidential election, asset manager VanEck predicts. The firm is confident that the first spot Bitcoin ETFs will be approved in the first quarter of 2024. However, it also made a gloomy prediction for the general U.S. economy. VanEck is among several firms, including BlackRock and Fidelity, that are vying for an approved spot Bitcoin ETF. VanEck also believes that the BTC halving, due in April or May, “will see minimal market disruption,” but there will be a post-halving price rise.
Winners and Losers
At the end of the week, Bitcoin (BTC) is at $44,402, Ether (ETH) at $2,364 and XRP at $0.66. The total market cap is at $1.65 trillion, according to CoinMarketCap.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Bonk (BONK) at 203.10%, ORDI (ORDI) at 134.34% and BitTorrent (BTT) at 114.32%.
The top three altcoin losers of the week are Maker (MKR) at -6.48%, UNUS SED LEO (LEO) at -6.22% and Kaspa (KAS) at 4.98%.
“It takes a community and the whole industry to figure out how to better educate people. That’s the hard part. It’s not a technology issue; it’s an operational problem.”
In a post on X (formerly Twitter) on Dec. 7, entrepreneur Alistair Milne noted that should current performance continue, Bitcoin will witness a crossover of two weekly moving averages (MAs), which have never delivered such a bull signal before.
The 50-week and 200-week MAs are key trendlines for Bitcoin traders and analysts alike. The latter is the ultimate bear market support level, and it has so far never decreased in value.
BTC price strength is on the way to taking the 50-week MA trendline above the 200-week counterpart. Known as a “golden cross,” on lower timeframes, this is considered a classic bullish signal, and for Milne, the impetus is that considerable upside could be in store should the phenomenon play out.
“The 50-week moving average will now soon cross back above the 200-week MA making a ‘golden cross’ for the 1st time. QED: Early bull market,” he wrote.
FUD of the Week
Crypto is for criminals? JPMorgan has been fined $39B and has its own token
JPMorgan Chase CEO Jamie Dimon is being criticized by the crypto community after claiming Bitcoin and cryptocurrency’s “only true use case” is to facilitate crime. However, according to Good Jobs First’s violation tracker, JPMorgan is the second-largest penalized bank, having paid $39.3 billion in fines across 272 violations since 2000. About $38 billion of these fines came under Dimon’s watch, who has been CEO since 2005.
British regulator adds Justin Sun-linked Poloniex to warning list after $100M hack
The United Kingdom’s Financial Conduct Authority (FCA) has added crypto exchange Poloniex to its warning list of non-authorized companies. The Seychelles-based exchange is one of the three companies owned by or affiliated with entrepreneur Justin Sun that have suffered four hacks in the last two months. The warning to Poloniex was published on the FCA’s website on Dec. 6. It doesn’t offer a reason but says that “firms and individuals cannot promote financial services in the UK without the necessary authorization or approval.”
US senators target crypto in bill enforcing sanctions on terrorist groups
A bipartisan group of lawmakers in the United States Senate introduced legislation aimed at countering cryptocurrency’s role in financing terrorism, explicitly citing the Oct. 7 attack by Hamas on Israel. The bill would expand U.S. sanctions to include parties funding terrorist organizations with cryptocurrency or fiat. According to Senator Mitt Romney, the legislation would allow the U.S. Treasury Department to go after “emerging threats involving digital assets.”
Lawmakers’ fear and doubt drives proposed crypto regulations in US
If the Digital Asset Anti-Money Laundering Act were to become law, many cryptocurrency providers would have to learn how to comply with the same regulations as traditional financial institutions.
Expect ‘records broken’ by Bitcoin ETF: Brett Harrison (ex-FTX US), X Hall of Flame
Bitcoin has gained recognition in the financial sector within two decades after its launch. This is evident in the increasing number of times the leading digital asset has been mentioned in official filings over the past years.
According to recent research, the world’s largest cryptocurrency was mentioned in more than a thousand filings with the United States Securities and Exchange Commission (SEC) in November, recording a new high and indicating rising adoption of the asset.
Bitcoin Mentioned in 1,074 Filings in November
The research found that 1,074 filings mentioned “bitcoin” in November. The figure was a 100% increase from the 527 filings mentioning the crypto asset in October. The new high also represented a 32.6% rise from the previous peak of 810 set in May and a 35.1% from November 2022.
One of the analysts noted that filings in November soared because crypto-related companies were required to report quarterly earnings in their 10-Qs and 8-Ks; hence, comparing last month with October was not fair.
However, the higher frequency of bitcoin-related filings shows more adoption and recognition of crypto and indicates that many firms are interested in the exchange-traded fund (ETF) hype. Roughly 40 filings came from the Grayscale Bitcoin Trust and were mostly free-writing prospectuses written by the asset manager’s executives ahead of the expected GBTC conversion.
The Anticipated Spot Bitcoin ETF Approval
Bitcoin showing up in more regulatory filings reflects excitement in the broader crypto market over the SEC’s anticipated approval of the first spot Bitcoin ETF. Over the past few months, around 13 traditional finance giants, including BlackRock, Fidelity, Ark Invest, Franklin Templeton, WisdomTree, and Valkyrie, have applied for spot Bitcoin ETFs with the SEC.
While the agency is expected to make its first spot Bitcoin ETF approval by the first week of January 2024, BTC has been on an ETF-driven rally over the past few days.
The leading crypto asset soared past the $44,000 mark on December 5, less than 48 hours after hitting $41,000. However, the cryptocurrency had fallen a few steps back and was trading around $43,900 at the time of writing, per data from CoinMarketCap.
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The journey towards the approval of an Ethereum ETF in the United States has seen a new development yesterday as the US Securities and Exchange Commission (SEC) has announced a delay in the decision for Grayscale’s Ethereum trust conversion into a spot Exchange Traded Fund (ETF). The SEC has stated the need for an extended period to evaluate the proposed rule change, pushing the new deadline Grayscale to January 25, 2024.
In its reasoning, the SEC has reiterated, “The commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein.” Notably, the delay comes at a time where the US agency is working with now 13 spot Bitcoin ETF applicants on presumably the final amendments before a January 10 approval.
Timeline For A Spot Ethereum ETF Approval
Despite the latest delay, the crypto community remains optimistic about the future of spot Ethereum ETFs. Bloomberg ETF analyst James Seyffart has suggested that delays are par for the course, tweeting, “Update: As expected Grayscale’s Ethereum trust filing just got delayed. It was due by 12/6/23 so this is completely normal.”
Seyffart also shared a table of all seven spot Ethereum ETF applicants: VanEck, 21Shares & ARK, Hashdex, Grayscale, Invesco & Galaxy, BlackRock, Fidelity and their deadlines. He further hinted at potential approvals by mid-2024, responding to criticisms from Adam Back, CEO of Blockstream, with “Unfortunately I think you’re gonna be really upset by June of next year.”
In response to queries about the probability of an Ethereum ETF approval following a Bitcoin ETF, Eric Balchunas of Bloomberg has indicated that the first filers, Ark and VanEck, have strong odds of approval by their final deadline on May 23, 2024, as they are expected to use the same mechanics as spot Bitcoin ETFs, and due to the fact that Ether futures have already received the green light from the US SEC.
Queried about for the odd of a spot Ethereum ETF approval, he remarked, “Not formally yet, but final deadline for the first filers Ark and VanEck is May 23rd so strong odds they approved by then given they’d be using same design as btc etfs and ether futures were Ok’d.”
The Next Deadlines
The table by Seyffart shows that the next Ethereum ETF deadlines are from December 23 to 26 for VanEck, Ark Invest and Invesco & Galaxy, followed by Hashdex on January 1. Since a spot Bitcoin ETF is very unlikely to be approved by then, delays by the SEC are more than likely for this batch of filings.
Both iShares by BlackRock and the Fidelity Ethereum Fund have their next deadlines on January 25 and January 21, 2024 respectively. These dates are crucial as they could involve either an extension, a request for more information, or a final decision.
But things only get really tense towards the final deadlines for all Ethereum ETF filers, as outlined by both Bloomberg ETF experts. With VanEck poised for May 23, 2024, and ARK Invest for May 24, 2024 and other notable filers like Hashdex Nasdaq Ethereum ETF and Grayscale’s Ethereum Trust Conversion (ETHE) scheduled for decisions by May 30, 2024, and June 18, 2024, respectively, the timeline for potential approvals is taking shape.
Asset manager BlackRock has updated its application to launch the first-ever spot Bitcoin ETF in U.S.
The document appeared on the website of the U.S. Securities and Exchange Commission (SEC). Bitwise has also updated its application to launch a similar tool.
Analysts believe the action signals that the SEC is continuing discussions with the market about opportunities to approve a spot Bitcoin ETF.
What does this mean? Without having read them — it just means that the wheel is still turning. Both the SEC and these issuers are working hard to iron things out. These filings are likely the result of many conversations and a lot of man hours on/between both sides.
The updates could be a step that allowed companies to “tailor” applications to the regulator’s requirements.
BlackRock’s updated document included new language about the efforts the trust administrator will make to monitor unusual price movements. It also added anti-money laundering compliance language and included a verified PricewaterhouseCoopers statement.
Bloomberg analysts expect approval of a spot Bitcoin ETF in the U.S. in January 2024. James Seyffarth and Eric Balchunas believe there is a 90% chance of a spot Bitcoin ETF being approved before January 10, 2024, the day by which the SEC must make a final decision on ARK Invest’s application.
As institutional interest in Bitcoin grows, Fidelity and BlackRock’s proposed spot Bitcoin Exchange-Traded Fund (ETF) faces an unexpected hurdle: the crypto market’s unwillingness to let go of the coin at bargain prices.
Bitcoin To $60,000 In Progress?
According to Mike Alfred, who claims to be a value investor and a board director, the market will “unlikely” allow BlackRock to purchase BTC below $60,000. Taking to X on December 4, Alfred said BlackRock and other Wall Street players keen on issuing spot Bitcoin ETFs would have to “buy for Boomer’s 401k plans for at least $60,000.”
This preview stems from the rapidly growing demand among institutional investors, as seen by the number of Wall Street players willing to issue complex derivatives tailored for, among other investors, “baby boomers,” most of whom are “approaching retirement.” With their substantial retirement savings, baby boomers increasingly recognize BTC’s potential as a hedge against inflation and a store of value.
Following Federal Reserve intervention during the COVID-19 pandemic, inflation rose to multi-year levels in 2021. To preserve purchasing power, the central bank began hiking interest rates. Although inflation has fallen and the economy stabilized, it remains higher than the target of 2%. The Fed continues to track this metric and may further intervene by raising rates to lower inflation. This might impact Bitcoin prices, as seen in the past months.
Nonetheless, the potential influx of boomer money into Bitcoin via a Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) approved derivatives product is a big boost for the coin. Though the SEC has yet to authorize multiple spot Bitcoin ETFs, the crypto and Bitcoin market expects the strict regulator to greenlight the first product in the next few weeks.
BlackRock And Company To Buy BTC At A Premium
Accordingly, ahead of this milestone development for the Bitcoin and crypto market, Alfred thinks BlackRock, Fidelity, and other players won’t secure Bitcoin at spot rates. Instead, the market anticipates that BlackRock, one of the world’s largest digital asset managers, will make their “bi-weekly purchases at prices above $60,000.”
The coin is trading at April 2022 levels, ripping above $40,000 over the weekend as bulls step up. Looking at the BTC candlestick arrangement on the daily chart, the first clear resistance is around $48,000.
The coin trades within a bullish breakout formation following gains above $32,000. As buyers step up and investors anticipate the SEC approving the first batch of spot Bitcoin ETFs, the coin will likely continue increasing toward all-time highs of around $70,000.
The Bitcoin price rose to $38.475 yesterday, marking a marginally higher high for the year. Nevertheless, the price did not manage to close the day above the important $38,000 mark. Shortly before the end of the day, the bears managed to push the price down again.
As crypto analyst Daan Crypto Trades remarked, “Market does its best to shake out everyone trying to pre-position for a possible Bitcoin ETF approval. It’s just free liquidity for the MMs/Whales. Sweep highs, trap longs, squeeze out longs, bait shorts, front run lows and repeat the whole process.”
Bitcoin price | Source: X @DaanCrypto
BlackRock Argues With SEC Over Details Of Spot Bitcoin ETF
In a notable development, BlackRock, the world’s largest asset manager, has been again actively engaged in discussions with the US Securities and Exchange Commission (SEC) concerning the structure of its spot ETF yesterday.
Eric Balchunas, senior ETF analyst at Bloomberg, revealed, “BlackRock met with the SEC’s Trading & Markets division again yesterday and presented them with a ‘revised’ in-kind model design based on Staff’s comments at their 11/20 meeting.” This revised model includes a notable change in the process, specifically at ‘Step 4’, which is the offshore entity market maker acquiring Bitcoin from Coinbase and then pre-paying in cash to the US registered broker dealer who is not allowed to touch BTC.
James Seyffart, another Bloomberg analyst, highlighted the ongoing negotiations, adding, “More confirmation that Issuers are still meeting with the SEC. BlackRock/Nasdaq still pushing for In-Kind creation & redemption. Seems like SEC hasn’t budged on cash creates demands if this was the primary focus of the meeting. At least not before yesterday, Interesting days ahead!”
The original “In-Kind Redemption” flow had Market Maker’s Broker/Dealer entity (MM-BD) placing an order for redemption through the Authorized Participant (AP), who approves the order, allowing MM-crypto to borrow Bitcoin (or cash) to sell short. This redemption flow had potential balance sheet impacts and risks that the SEC was concerned about.
BlackRock has now proposed a “Revised In-Kind (‘Prepay Model’)” Redemption flow. This new model involves MM-crypto delivering cash to MM-BD instead of Bitcoin, and MM-BD then delivers ETF shares to the Transfer Agent via API. The Bitcoin custodian is instructed by the issuer to transfer Bitcoin to MM-crypto, who then closes the short position in BTC.
The benefits of this revised model are manifold. It aims to lower transaction costs and shifts the execution risks from investors to crypto market makers. It also claims to provide superior resistance to market manipulation and remove the need for issuers to finance or pre-fund sell trades. The reduction in risks of operating events and the simplification across the ecosystem could mean lower variance on how In-kind models can be executed versus cash models.
BlackRock’s Bitcoin ETF structure “in-kind” | Source: X @EricBalchunas
90% Odds Of Approval Remain
Should the SEC approve this revised model, it could herald the introduction of the first US-based spot Bitcoin ETF, a significant milestone that would allow investors to gain direct exposure to Bitcoin rather than through derivative instruments like futures. Despite these developments, there remains a level of uncertainty surrounding the SEC’s stance on the matter, particularly regarding the implications of spot Bitcoin exposure for retail investors through an ETF.
Recent leaks suggested the SEC might prefer cash creation processes over in-kind Bitcoin transfers, a move that could significantly alter the landscape for ETF issuers and broker-dealers dealing with Bitcoin. Nonetheless, Bloomberg’s ETF analysts have reiterated their 90% odds for a spot ETF approval by January 10 yesterday.
A number of Amazon.com Inc. executives have disclosed sales of some of their Amazon stock holdings in recent weeks, but Jeff Bezos, the company’s executive chair and a mega-shareholder, was not among them.
Despite some reports to the contrary, Bezos hasn’t disclosed any sales of Amazon shares AMZN for two years, but he has given some shares away to nonprofit organizations.
US officials announce $4.3B settlement with Binance, plea deal with CZ
Binance and its co-founder, Changpeng “CZ” Zhao, have reached a settlement over criminal and civil cases with the United States Department of Justice. CZ will plead guilty to one felony charge as part of the negotiated agreement. Attorney General Merrick Garland announced the settlement, claiming Binance’s policies allowed criminals involved in illicit activities to move “stolen funds” through the exchange. As part of the settlement, CZ announced on X (formerly Twitter) that he had stepped down as CEO and that Binance’s global head of regional markets, Richard Teng, will assume the position. He added he was “proud to point out” that U.S. officials didn’t allege that Binance misappropriated funds or manipulated markets. CZ was released on bail and is battling government efforts to bar his return to the United Arab Emirates to be with his family. His sentencing is scheduled for February.
BlackRock met with SEC officials to discuss spot Bitcoin ETF
Representatives from BlackRock and Nasdaq met with the U.S. Securities and Exchange Commission (SEC) to discuss the proposed rule allowing the listing of a spot Bitcoin exchange-traded fund (ETF). BlackRock provided a presentation detailing how the firm could use an in-kind or in-cash redemption model for its iShares Bitcoin Trust. Many reports have suggested the SEC could be nearing a decision on a spot BTC ETF for listing on U.S. markets. SEC officials also met with Grayscale representatives this week to discuss the listing of a Bitcoin ETF. BlackRock is one of many firms with spot crypto ETF applications in the SEC pipeline awaiting a response, including Fidelity, WisdomTree, Invesco Galaxy, Valkyrie, VanEck and Bitwise.
Bitcoin user pays $3.1M transaction fee for 139 BTC transfer
A Bitcoin user paid $3.1 million in fees for transferring 139.42 BTC. The transaction fee is the eighth-highest in Bitcoin’s 14-year history. A wallet address tried transferring 139.42 BTC only to pay more than half the actual value of the transaction fee. The destination address received only 55.77 BTC. The mining pool Antpool captured the absurdly high mining fee on block 818087. This is the largest Bitcoin transaction fee ever paid in dollar terms, knocking off Paxos’s September transfer of $500,000.
SEC sues Kraken alleging it’s an unregistered exchange, mixes user funds
The U.S. Securities and Exchange Commission has sued Kraken, alleging it commingled customer funds and failed to register with the regulator as a securities exchange, broker, dealer and clearing agency. Additionally, the SEC alleged Kraken’s business practices and “deficient” internal controls saw the exchange commingle up to $33 billion worth of customer assets with its own. The SEC said this resulted in a “significant risk of loss” for its clients. In a follow-up blog post, Kraken said the SEC’s commingling accusations were “no more than Kraken spending fees it has already earned,” and the regulator doesn’t allege any user funds are missing.
Appeals court rejects Sam Bankman-Fried’s bid for release
Sam Bankman-Fried will stay jailed after failing to convince a United States appellate court that he should be freed while his legal team appeals his conviction. Government prosecutors accused Bankman-Fried of leaking Caroline Ellison’s journals to The New York Times in July, which caused his bail to be revoked by a New York District Court. Bankman-Fried was found guilty of seven fraud and money laundering-related charges on Nov. 2. The former FTX CEO will remain behind bars while he awaits his sentencing on March 28 next year.
Winners and Losers
At the end of the week, Bitcoin (BTC) is at $37,710, Ether (ETH) is at $2,079, and XRP is at $0.62. The total market cap is at $1.43 trillion, according to CoinMarketCap.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Blur (BLUR) at 99.25%, FTX Token (FTT) at 39.05% and KuCoin Token (KCS) at 24.82%.
The top three altcoin losers of the week are Celestia (TIA) at -19.89%, ORDI (ORDI) at -17.63% and THORChain (RUNE) at -15.53%.
“We, the employees of OpenAI, have developed the best models and pushed the field to new frontiers, [but] the process through which you terminated Sam Altman […] has jeopardized all of this work and undermined our mission and company.”
‘Enjoy sub-$40K Bitcoin’ — PlanB stresses $100K average BTC price from 2024
Bitcoin buyers should enjoy the chance to add to their stack below $40,000, according to PlanB, pseudonymous creator of the stock-to-flow family of BTC price models. He believes Bitcoin will rise much higher than its recent 18-month highs.
Bitcoin bear market bottoms are characterized by the spot price dipping below the realized price, while bull markets begin once the spot crosses the two-year and five-month realized price levels. BTC/USD is now once again above all three realized price iterations.
“Enjoy sub-$40k bitcoin … while it lasts,” PlanB commented on an accompanying chart.
Asked whether the market should expect lower levels from here, PlanB would not be drawn, saying that he simply expected an average BTC price of at least $100,000 between 2024 and 2028 — Bitcoin’s next halving cycle.
FUD of the Week
HTX to restore services ‘within 24 hours’ after $30M hack
Crypto exchange HTX, formerly known as Huobi Global, resumed deposits and withdrawals within 24 hours after suffering a $30 million exploit on Nov. 22. The exploit was reported to be $13.6 million around the time of the incident, but has since increased in value. HTX’s hot wallets were compromised alongside a coordinated $86.6 million attack against the HTX Eco (HECO) Chain bridge, consisting of HTX, Tron and BitTorrent. The company has promised to fully compensate users for any losses incurred as a consequence of the hack.
CZ an ‘unacceptable risk of flight,’ should stay in US: DOJ
United States prosecutors are trying to stop former Binance boss Changpeng “CZ” Zhao from leaving the country, expressing concern about his potential flight risk. The government requested a review and overturn of a judge’s decision that would allow Zhao to return to his home in the United Arab Emirates (UAE) on a $175 million bond under the condition that he returns to the U.S. two weeks before his February 2024 sentencing. In a proposed order, prosecutors wrote that Zhao “presents an unacceptable risk of flight,” arguing that his ties and favored status in the UAE, along with the country’s lack of an extradition treaty with the U.S., are reasons to block him from leaving the country.
KyberSwap hacker offers $4.6M bounty for return of $46M loot
The decentralized exchange KyberSwap has offered a 10% bounty reward to the hacker who stole $46 million on Nov. 22 and left a note of negotiation. The exchange wants 90% of the loot returned. The hacker made away with roughly $20 million in Wrapped Ether, $7 million in wrapped Lido-staked Ether and $4 million in Arbitrum tokens. The hacker then siphoned the loot across multiple chains, including Arbitrum, Optimism, Ethereum, Polygon and Base.
This is your brain on crypto: Substance abuse grows among crypto traders
According to some addiction experts, the high-stress atmosphere of cryptocurrency trading can provide a perfect environment for substance abuse.
Michael Saylor’s a fan, but Frisby says bull run needs a new guru: X Hall of Flame
Bitcoin enthusiast Dominic Frisby has a wild journey, from penning one of the first-ever Bitcoin books to plastering “Bitcoin fixes this” on the Bank of England.
6 Questions for Alex O’Donnell about financial journalism and the future of DeFi
In a YouTube published video yesterday, crypto analyst The Luckside Crypto host reacted strongly to news that the SEC has sued crypto exchange Kraken.
The analyst expressed disbelief, stating “I can’t believe we are still having these discussions.” He claims the SEC alleges no fraud, manipulation, customer harm or security issues with Kraken. Rather, the suit simply targets Kraken’s large amount of assets under management.
The Luckside Crypto host speculated this is another SEC “money grab” to fund more crypto lawsuits, on the heels of settlements earlier this year. He accused the SEC of “not making much headway” in other cases.
Additionally, the analyst derided the SEC for still alleging coins like Cardano (ADA) and Solana (SOL) are securities. He firmly states “ADA’s not a security, Solana’s not a security.” He sees the SEC overstepping its authority to regulate assets on secondary exchanges.
While noticing a slight market pullback, the host claims this lawsuit is having little price impact compared to previous regulatory actions. He believes the crypto sector will move forward regardless, heading toward the 2024 Bitcoin (BTC) halving and continued adoption.
Finally, the analyst predicts the SEC will eventually face restrictions, as Congress and courts intervene on cases like this that target well-functioning crypto firms. But for now, he sees the SEC as “trying to be the big dogs” and failing to protect investors with these actions.
Matrixport, a leading digital finance platform, today, November 22, released a comprehensive research note focusing on the significant implications of yesterday’s developments in the crypto industry, particularly regarding the prospects of a spot Bitcoin Exchange-Traded Fund (ETF) in the United States.
Following the guilty plea of Binance CEO Changpeng Zhao (CZ) and the substantial financial settlements involved, Matrixport suggests that the path for approving a spot Bitcoin ETF might have become significantly clearer. The note highlights the regulatory crackdowns and compliance upgrades in the crypto sector, indicating a shift towards greater regulatory alignment with traditional financial (TradFi) systems.
“Some would argue that the US agencies have cleaned up the industry this year by dismantling the US crypto-related banks, as two of them were running an internal ledger that crypto companies could use 24/7 to transfer fiat. Arguably, few (perceived) major actors are left, and with Bitcoin only declining -3.4% during the last 24 hours, the market is stomaching a major risk-off event,” Matrixport remarks.
Spot Bitcoin ETF Approval Odds At 100% Now?
The company points out that with stringent enforcement actions and enhanced compliance programs becoming the norm among crypto exchanges, the differentiation between regulated and non-regulated cryptocurrency exchanges may become a key metric in 2024. This shift is seen as instrumental in the potential approval of a spot Bitcoin ETF in the US, a development long anticipated by the industry.
“The result will likely be that more exchanges will enhance their compliance programs and become part of a surveillance-sharing agreement, which will be instrumental in approving a spot Bitcoin ETF in the US,” the firm stated, adding, “With this plea deal, the expectations for a spot Bitcoin ETF might have increased to 100% as the industry will be forced to follow the rules that TradFi firms must follow.”
The firm believes that this “whitewashing” of the industry will not only enhance Bitcoin’s adoption by institutional players but also position it as a safe-haven asset in investment portfolios. “More importantly, this industry’s whitewashing will strengthen the Bitcoin adoption case for institutional players and will likely become a safe-haven asset in investors’ portfolios,” Matrixport predicts.
The note also touches on the anticipated sale of the FTX exchange and its potential relaunch under a US securities law-compliant management team by Q3 2024. Matrixport speculates that this could lead to significant inflows, estimated between $24-50 billion, into any US-listed Bitcoin ETF. They also note the increasing trend of crypto firms making markets on CME-listed crypto derivatives, indicating a shift from retail-focused, unregulated exchanges to those that are fully regulated and cater to institutional clients.
‘Dark Cloud Has Been Removed’ As ETF Makes Progress
Analysts and industry experts have echoed Matrixport’s sentiments. Will Clemente, a noted analyst, stated, “With resolution on Binance, just a matter of weeks until Bitcoin ETF approval now.” Tony “The Bull” Severino, head of research at NewsBTC, commented, “A dark cloud has just been removed from the crypto market.” Conversely, Scott Johnsson, a finance lawyer at Davis Polk, offered a more cautious view, suggesting that “It’s far more likely an ETF decision led the Binance resolution than the other way around imo. And I’m not convinced either is that likely.”
Remarkably, there has been some movement in the spot ETF approval process in the last few days. Ark Invest has kicked off the third round of amendments to the S-1 filings, Grayscale had a meeting with the US Securities and Exchange Commission yesterday regarding its “uplisting.”
Binance faces a pivotal change as CEO Changpeng Zhao agrees to step down and the company prepares to pay $4.3 billion in fines, following a settlement with the SEC over anti-money laundering violations.
Changpeng Zhao’s decision to step down as CEO of Binance and plead guilty to violating U.S. anti-money-laundering requirements has sparked a complex interaction with U.S. regulatory bodies, particularly in the context of a substantial settlement agreement.
The unfolding situation involves intricate negotiations and exchanges between Zhao, Binance and the U.S. Securities and Exchange Commission (SEC), according to sources close to the matter. The core of these discussions revolves around the specifics of the charges against Binance and its CEO, and the implications of the settlement for Binance’s future operations.
Today, I stepped down as CEO of Binance. Admittedly, it was not easy to let go emotionally. But I know it is the right thing to do. I made mistakes, and I must take responsibility. This is best for our community, for Binance, and for myself.
“A lot of back and forth is happening as the SEC seeks to understand the depth of the violations and the steps Binance will take to comply with regulations,” an insider noted. “The SEC is essentially laying out what they expect from Binance in terms of regulatory compliance, and now it’s up to Binance’s leadership to respond to these expectations.”
We’re pleased to share we’ve reached resolution with several US agencies related to their investigations.
This allows us to turn the page on a challenging yet transformative chapter of learning that has helped us become stronger, safer, and an even more secure platform.
Under the settlement, Zhao will step down from his role, and Binance, the company he founded in 2017, will plead guilty to charges of anti-money laundering and sanctions violations. Additionally, Binance has agreed to pay fines totaling $4.3 billion, which includes resolving civil allegations brought by regulators. Zhao himself has agreed to pay a $50 million criminal fine, with the possibility of a reduction based on his agreement to pay separate civil penalties.
It is an honour and with the deepest humility that I step into the role of Binance’s new CEO.
We operate the world’s largest cryptocurrency exchange by volume. The trust placed on us by our 150m users and thousands of employees is a responsibility that I take seriously and hold…
The plan for Binance’s future, following the Zhao’s departure, includes appointing Richard Teng as the new CEO. Teng, formerly the Global Head of Regional Markets at Binance and with a strong background in financial services and regulatory affairs, is expected to steer the company through a more compliant and transparent phase. This includes enhancing Binance’s anti-money laundering measures and ensuring adherence to global sanctions.
If Binance fails to meet these regulatory expectations, the company faces the risk of more severe penalties, including potential restrictions on its operations. The approved backup plan, in case the company fails to adhere to the settlement terms, involves a more rigorous restructuring of Binance’s operational and compliance procedures.
