Tag: Crypto

America must lead on cryptocurrency

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By Dave McCormick. (Washington Examiner). March 26, 2024.

Across my career at the intersection of national security and our economy, I have witnessed firsthand several game-changing technological revolutions. From GPS to the internet and from smartphones to artificial intelligence, our nation’s unmatched capacity to innovate has created unprecedented benefits for the economy and security.

Another wave is upon us: Blockchain and crypto offer America the chance to lead another generation of critical innovation, but policymakers must do their part, or this opportunity will slip away. If the Biden White House and Congress don’t provide the support and regulatory certainty this burgeoning industry requires, there is little doubt it will develop and thrive elsewhere.

Blockchain is a technology that provides a transparent ledger for something of value. Crypto uses blockchain to enable transactions between people online. The benefits of America leading in blockchain and crypto are clear. 

First, these technologies are grounded in principles such as individual freedom, limited government, and privacy, which, as a conservative, I hold dear. Conducting transactions through blockchain eliminates powerful and oftentimes expensive intermediaries, making the financial system more accessible.

While the ledgers showing transactions are public, the identity of account holders is anonymous, providing privacy for accounts doing legal transactions while exposing illicit transactions to significant scrutiny. This balance between privacy and the free flow of data is sorely needed in an age in which social media platforms and other tech companies have unparalleled data on every user.

Read more here: Washington Examiner.

Binance’s $4.3 Billion Payment in US Plea Deal Approved by Judge

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By Sabrina Willmer and Anna Edgerton. (Bloomberg). February 23, 2024.

Binance Holdings Ltd. will pay $4.3 billion after a judge approved a plea deal that levies one of the largest criminal penalties in US history against the world’s biggest cryptocurrency exchange.

“This really is a case where the ethics of the company were compromised by greed,” US District Judge Richard Jones said at a sentencing hearing in Seattle on Friday.

Late last year, Binance and its founder, Changpeng Zhao, pleaded guilty to anti-money
laundering and sanctions charges to resolve a long-running investigation by prosecutors
and regulators. Binance admitted that it allowed transactions with Hamas and other
terrorist groups on the exchange.

As part of the deal, the company’s compliance must be monitored by an independent firm
for as long as five years. The monitor hasn’t yet been apppointed. Bloomberg reported
earlier that New York-based law firm Sullivan & Cromwell was poised to take the coveted
role.

Read more here: Bloomberg

CryptoLaw: Looking Ahead

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By Kristi Warner

Since CryptoLaw launched in 2021, we have accomplished so much as a community. John started CryptoLaw as a reaction to “gross government overreach” – his goal was to build a trusted platform that people could turn to for news, updates, and analysis on legal and policy issues related to digital assets and the cryptocurrency industry. Through the years, and all the cases, we have stayed true to that mission – we have been an advocate for digital assets, but more importantly we have been an advocate for the truth. 

Our plan for 2024 is to continue that mission. We are committed to holding government agencies accountable, shedding light on the revolving doors, promoting fair regulatory guidelines for the industry, and protecting investors every single day. 

As someone who has been with CryptoLaw since the start, and has seen what the platform and the audience behind it has accomplished, I am fully confident and excited for our future. We already have some big things planned for 2024, and we can’t wait to share them with you. Thank you for your support, CryptoLaw would not exist or be important without you, and we can’t wait for another ground-breaking year.

For more insight, please watch our recent livecast – CryptoLaw 2024: What to Expect

Coinbase wins approval to offer crypto futures trading in US

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By Reuters Staff. (Reuters). August 16, 2023.

Coinbase Global (COIN.O) said on Wednesday it had secured approval to offer cryptocurrency futures to U.S. retail customers, scoring a major regulatory win even as the crypto exchange battles a lawsuit from the Securities and Exchange Commission (SEC).

Shares of the company climbed 5.5% to $83.52 in premarket trading. The approval was granted by the National Futures Association (NFA), a self-regulatory organization designated by the Commodity Futures Trading Commission (CFTC).

“This is a critical milestone that reaffirms our commitment to operate a regulated and compliant business,” Coinbase said.

The company has openly criticized the SEC, which in a June lawsuit accused Coinbase of operating illegally because it had failed to register as an exchange.

CEO Brian Armstrong has also said more U.S. crypto companies could move offshore due to a hostile regulatory environment and that SEC Chair Gary Gensler’s enforcement-first approach could stifle innovation in the industry.

Read the full article here.

Operation Choke Point 2.0

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By Andrew Langer. April 4, 2023. (Real Clear Policy)

In 2014, the Wall Street Journal blew the lid off the Obama-Biden Administration’s “Operation Choke Point”, where the Department of Justice and bank regulators colluded and overreached their authority to close legal businesses that were deemed “undesirable”.  They did it through pressuring banks and credit card payment processors to close the accounts of people and companies that had not violated any laws, without any proof of wrongdoing. It’s happening again today, on a much bigger scale, against legal U.S. companies that use crypto technology for their product offerings.

It was illegal then. It’s illegal now.

As I have previously written, we are still in the infant stages of cryptocurrencies and associated crypto tech. Cryptocurrencies and the underlying technology don’t neatly fit into the related – but ultimately, different – legal categories and classifications for the agencies that regulate securities, commodities, currencies and all other aspects of commerce. 

Congress and the federal government should have moved a long time ago to set out a regulatory framework that addressed this, so that American innovators could know how to legally operate and consumers could be protected from harm. It didn’t happen, and that has provided an opening for a panicked Administration to launch another illegal war on American businesses they don’t like and distract the public from their own economic mismanagement.

Read the full article here.

Barney Frank Was Right About Signature Bank

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By The Editorial Board. March 20, 2023. (Wall Street Journal)

We never thought we’d write that headline. But on Sunday the Federal Deposit Insurance Corp. announced that New York Community Bancorp’s Flagstar Bank will assume all of Signature Bank’s cash deposits except for those of crypto companies. This confirms Mr. Frank’s suspicions—and ours—that Signature’s seizure was motivated by regulators’ hostility toward crypto.

Mr. Frank alleged last week that regulators seized Signature, whose board he served on, “to send a message to get people away from crypto.” It increasingly appears that way. Reuters reported last week that the FDIC was requiring any buyer of Signature to give up all crypto business at the bank. The FDIC denied this.

But the agency’s statement says that “Flagstar Bank’s bid did not include approximately $4 billion of deposits related to the former Signature Bank’s digital-assets banking business.” That means crypto companies will have to find another bank to safeguard their deposits. Many say that government warnings to banks about doing business with crypto customers is making that hard.

Read the full article here.

Crypto Firm Paxos Faces SEC Lawsuit Over Binance USD Token

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By Vicky Ge Huang, Patricia Kowsmann and Dave Michaels. February 12, 2023. (Wall Street Journal).

The Securities and Exchange Commission has told crypto firm Paxos Trust Co. that it plans to sue the company for violating investor protection laws, according to people familiar with the matter, the latest move in the agency’s escalating campaign in crypto enforcement.

The SEC’s enforcement staff issued a letter to Paxos known as a Wells notice, which the agency uses to inform companies and individuals of a possible enforcement action, according to the people.

The notice alleges that Binance USD, a digital asset that Paxos issues and lists, is an unregistered security, according to the people.

Read the full article here.

SEC v. Ripple: Did The Government Fail To Prove Its Case?

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By Hassan Tyler. January 19, 2023. (ValueWalk).

The saga for what Forbes has called “ the cryptocurrency trial of the century” looks as if it is about to enter its closing stages. Final briefs on summary judgment were filed in November of last year by the U.S. Securities and Exchange Commission (SEC) and the payments software company Ripple Labs in SEC v. Ripple .

Nearly two years of arguments are now in the hands of Judge Analisa Torres of the Southern District of New York, who is expected to rule sometime in the first quarter of this year.

SEC v. Ripple

The issue revolves around how Ripple uses the XRP token and its decentralized ledger as a tool for its cross-border payments software that it sells to international banks and money transmitters. The company and two of its executives sold large amounts of the token to exchanges starting in 2013, which fed a substantial secondary market for the cryptocurrency and an ecosphere for the XRP Ledger for businesses and individuals without the involvement or permission of Ripple.

Read the full article here.

Crypto Goes to Washington

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By Molly Ball. October 3, 2022. (TIME).

To the untrained ear, Hester Peirce’s comment sounded anodyne, but everyone in the audience knew what she was doing: selling out her boss. “It’s fairly clear,” the U.S. Securities and Exchange commissioner said from the Washington conference stage, “that we’ve been taking an enforcement-first approach in an area where we should be taking a regulatory-first approach. I think we’ve got the balance wrong right now.”

Peirce was speaking at the D.C. Blockchain Summit in May, to an audience of the cryptocurrency faithful. Outside the auditorium, geeks, lobbyists and investors mingled in a cavernous converted warehouse. “Trust is non-fungible,” read a banner for the accounting firm Deloitte, hung from a balcony where the company was sponsoring a lavish spread of snacks. Most attendees were done up in D.C. drag—conservative suits and dresses, more boardroom than Burning Man.

Read the full article.

US Treasury Develops ‘Framework’ for International Crypto Regulation

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By Nikhilesh De. July 7, 2022. (CoinDesk)

The U.S. Treasury Department published a fact sheet Thursday outlining how it could work with foreign regulators to address the cryptocurrency sector.

The fact sheet, which is the first report published by the department as a result of U.S. President Joe Biden’s executive order on crypto, said the framework “is intended to ensure that … America’s core democratic values are respected,” pointing to consumer, investor and business protection, the safety of the global financial system and interoperability.

According to the sheet, the framework’s policy objectives also include reducing the potential use of crypto for illicit finance, promoting access to financial services, supporting technological advancement and “reinforc[ing] U.S. leadership in the global financial system.”

Read the full article here.