News | CoinExpressWay.com

Source : Bit Coin News

Added today

Israel Land Authority Examines Real Estate Tokenization Applications

Israel Lands Authority Examines Real Estate Tokenization Applications

The United States Securities and Exchange Commission (SEC) has announced a delay in its decision on several proposals for spot Bitcoin exchange-traded funds (ETFs). The affected applicants include financial giants like BlackRock, Invesco, Bitwise, and Valkyrie.

SEC Postpones Review of Bitcoin ETF Proposals

The SEC's decision to postpone the review process occurred two weeks ahead of the scheduled second deadline. It was originally arranged for October 16-19. Analysts suggest that these delays are directly tied to the looming threat of a government shutdown in the United States. It is expected to occur on October 1 if Congress fails to pass the necessary funding bills.

The ongoing deadlock in Congress over these bills has created a unstable situation for federal agencies, including the SEC. Bloomberg ETF analyst James Seyffart anticipated that similar delays will impact applications from Fidelity, VanEck, and WisdomTree.

BREAKING: ðŸ‡ºðŸ‡¸ BlackRock Spot #Bitcoin ETF decision was just delayed by SEC.Gary gonna get a phone call... ðŸ˜… pic.twitter.com/AXc6CMbmqD
â€” Bitcoin Archive (@BTC_Archive) September 28, 2023

SEC's Ultimatum: Mid-March Deadline for Bitcoin ETF Decisions

In late August, the SEC already delayed a group of spot Bitcoin ETF applicants as the initial cutoff point approached. The affected companies are now facing a third set of deadlines around mid-January, which could potentially be extended as well. The SEC's ultimate decision on the ETFs must be made by mid-March at the very latest.

Eric Balchunas, an ETF analyst at Bloomberg, has revised his predictions for the approval of a spot Bitcoin ETF. In late August, he estimated a 75% probability of approval by the end of 2023, which is up from an earlier estimate of 65%. Balchunas attributed this increased likelihood to the U.S. Court of Appeals Circuit's decisive ruling in favor of Grayscale in its legal battle against the SEC.

Balchunas has now raised his odds to a staggering 95% for approval by the end of 2024. This latest delay by the SEC may be seen as a sign that regulatory clarity and approval for spot Bitcoin ETFs in the United States is increasingly likely in the near future.

Market participants and cryptocurrency investors will continue to watch closely as developments unfold in both the SEC's decision-making process and the ongoing negotiations in Congress. It has the potential to significantly impact the fate of these highly anticipated Bitcoin ETFs.

This article was written by Tareq Sikder at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Everything You Need to Know About Mt. Gox Repayments

Few events have had the same impact as the demise of Mt. Gox, the world's largest Bitcoin exchange. The 2014 fiasco left hundreds of investors reeling as the exchange declared bankruptcy amid charges of theft and incompetence, culminating in the loss of an astounding 850,000 Bitcoins.

Years later, a complex process of restoration and reparations is begun, giving many who lost their valuables a glimpse of optimism.

Mt. Gox's Rise and Fall

Mt. Gox, which stands for "Magic: The Gathering Online Exchange," began as a trading network for collectible cards. However, its founder, Mark Karpeles, realized Bitcoin's potential and converted the exchange into a cryptocurrency trading hub. Mt. Gox handled more than 70% of all Bitcoin transactions worldwide at its peak.

Despite its early success, Mt. Gox had escalating problems, including security breaches and mismanagement charges. The most severe setback occurred in early 2014, when the exchange revealed the loss of 850,000 Bitcoins, which were worth around $450 million at the time. This significant loss resulted in insolvency and a later bankruptcy petition in Japan.

Mt. Gox Extends Deadline for Civil Rehabilitation Plan, Leaving Creditors in Limbo

Mt. Gox has pushed back its civil rehabilitation plan deadline to March 31, 2024, from the original October 15, 2023. This plan outlines how the remaining assets, which now hold a substantial value in bitcoin's surge, will be allocated to creditors who lost funds during the exchange's notorious hack, where around 850,000 bitcoins (approximately $450 million at the time) vanished.

The delay is attributed to legal disputes with some creditors and the complexity of asset allocation, with many creditors not yet agreeing to the proposed plan. While interim payments may occur before 2024, uncertainties loom large.

Technical difficulties emerge in the distribution of bitcoins to creditors worldwide. Claim submissions and valid bitcoin addresses present hurdles, while some creditors prefer cash, requiring conversions and transfers.

Bitcoin's volatility poses risks, as the repayment plan assumes price stability or growth. A significant price drop could render assets insufficient to cover claims, and mass creditor bitcoin selling might affect the market.

The Tokyo District Court holds the final decision on asset distribution, leaving creditors waiting for updates amid an enduring Mt. Gox saga.

Rehabilitation Procedures

Following the declaration of bankruptcy, Japanese authorities launched a legal procedure known as "civil rehabilitation." The goal of this approach was to liquidate Mt. Gox's remaining assets and distribute the proceeds to creditors in a more equitable manner than typical bankruptcy processes.

The management of Bitcoin claims is one of the key differences between civil rehabilitation and bankruptcy. Creditors would have received their claims in Japanese Yen at the 2014 Bitcoin price, drastically underestimating their losses owing to the subsequent price spike. Civil rehabilitation, on the other hand, allows creditors to receive their claims in Bitcoin, protecting the value of their investments.

The Path to Repayment

The road to repayment has been riddled with legal difficulties and delays. Significant progress, however, has been made:

The Rehabilitation Plan has been approved.

The Tokyo District Court accepted a restoration plan in March 2019, marking an important milestone. This plan defined the procedure for repaying creditors and dispersing Mt. Gox's remaining assets.

Bitcoin Redemption:

A significant amount of Bitcoin owned by Mt. Gox has been retrieved as part of the rehabilitation process. These reclaimed assets serve as the foundation for creditor repayments.

Filing Claims:

Creditors were compelled to submit claims in order to enforce their repayment rights. Creditors could specify the amount of Bitcoin due to them during the claims procedure.

Current Legal Proceedings:

Legal processes are still ongoing to handle lingering concerns and disputes concerning creditor claims and asset distribution.

Repayments to Creditors

The payback procedure consists of several steps:

Report of the Trustees:

The court-appointed trustee for Mt. Gox's bankruptcy estate, Nobuaki Kobayashi, produced a series of papers documenting the rehabilitation process, the status of creditor claims, and the estimated worth of assets.

Distribution on a pro rata basis:

Pro rata distribution is a critical component in the payback process. This means that depending on the total assets available for distribution, all accepted creditor claims will get the same percentage of their approved claim amount.

Claim Evaluation:

The trustee evaluates and analyzes creditor claims in consultation with legal and financial professionals. This procedure ensures that legitimate claims are recognized and creditors are fairly addressed.

Distribution of Bitcoin:

Creditors who made successful claims will be paid a portion of the seized Bitcoin assets. The payout will be made in Bitcoin, ensuring that the value is preserved at the moment of distribution.

Controversies and Obstacles

The reimbursement process for Mt. Gox has not been without its difficulties and disputes. Some critical issues are as follows:

Claims in Controversy:

Some creditors have challenged the assessed worth of their claims, resulting in legal battles and delays in the distribution process.

Timing:

The procedure has taken longer than expected, causing dissatisfaction among creditors who have been waiting to retrieve their assets for years.

Market Influence:

The distribution of a large number of Bitcoin could have an influence on cryptocurrency markets, raising concerns about price volatility.

Implications for Taxation:

Creditors may incur tax consequences depending on when and where they distribute their Bitcoin. These tax considerations differ depending on the jurisdiction.

The Mt. Gox Future

The bitcoin community is keeping a close eye on the payback procedure. The end of Mt. Gox's civil rehabilitation will be a watershed moment in the history of cryptocurrency exchanges and investor safety.

While there is some hope that assets will be returned to creditors, many questions remain. What impact would the distribution of a significant number of Bitcoin have on the broader cryptocurrency market? What can be drawn from the Mt. Gox saga to avoid such incidents in the future? These inquiries highlight the importance of strong security safeguards, transparency, and regulatory supervision in the bitcoin business.

As the legal proceedings continue, Mt. Gox creditors remain optimistic about resolving this long-standing dispute. The Mt. Gox saga should serve as a wake-up call to both investors and cryptocurrency exchange operators, emphasizing the significance of trust, security, and accountability in the fast evolving world of digital assets.

Lessons Discovered

The Mt. Gox debacle teaches the bitcoin sector numerous lessons:

Security is critical: To secure user dollars and data, exchange operators must emphasize strong security measures.
Oversight and Regulation: Regulatory frameworks and control are critical for protecting investor interests and preserving market integrity.
Transparency: Transparent communication with users is crucial for retaining confidence, especially during times of crisis.
Legal Proceedings: Civil rehabilitation, for example, can give a fair and equitable way of settling complex financial concerns.
Caution to Investors: When selecting bitcoin exchanges and platforms, investors should use caution and due research.

The outcome of Mt. Gox's civil rehabilitation will define the future of bitcoin creditor repayments. It demonstrates the cryptocurrency community's tenacity, as it continues to evolve and adapt in the face of challenges and uncertainties.

This article was written by Pedro Ferreira at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Ripple Abandons Fortress Trust Acquisition, Chooses to Retain Investment Stake

Ripple has decided to reverse its planned acquisition of Fortress Trust, a subsidiary of Fortress Blockchain Technologies that offers wallet and payment services. Less than a month after announcing its intention to acquire the firm, Ripple has chosen to back out of the deal.

Brad Garlinghouse, the CEO of Ripple, said on X (formerly Twitter): "A few weeks ago, we signed a letter of intent to acquire Fortress Trust, we've since made the decision not to move forward with an outright acquisition, though Ripple will remain an investor in Fotress Trust."

Ripple's Planned Acquisition Strategy

This strategic acquisition was seen as an essential step towards enhancing Ripple's regulatory licenses and bolstering its infrastructure capabilities, particularly in the blockchain and cryptocurrency payments solutions sector. As Ripple continues to grapple with its ongoing legal dispute with the SEC, the acquisition aimed to position the company as a trusted brand for enterprises, Finance Magnates reported.

One key development that may have contributed to Ripple's decision was a recent security incident involving Fortress Trust. A few days after Ripple's initial announcement, Fortune Magazine reported that Fortress Trust had suffered losses ranging from USD $12 million to USD $15 million due to a cryptocurrency hack. Scott Purcell, the Founder and CEO of Fortress Trust, revealed that only a small fraction of their customer base, specifically "four customers out of 225,000 customers," were affected.

In response to these reports, Purcell clarified to Bloomberg that the security breach had targeted a third-party service rather than Fortress Trust. He emphasized that Fortress Trust had not been directly hacked and stated: "6 out of Fortress' 250,000+ customers used it to log into their accounts."

Ripple Maintains Investment in Fortress

However, Ripple's change of plans did not disrupt the relationship between Ripple and Fortress. Garlinghouse emphasized the company's long-standing relationship with Fortress Blockchain Technologies. He praised Fortress Trust for building a robust business with recurring revenue and a substantial customer base, including crypto-natives and newcomers to the crypto industry.

The Fortress team is incredibly talented, and has built products solving real customer problems. While this outcome is different from what was originally planned, weâ€™ll continue to support them and hope to work together in the future!
â€” Brad Garlinghouse (@bgarlinghouse) September 28, 2023

Fortress Trust holds a Trust license in Nevada, which was anticipated to add to Ripple's existing licenses, which include a BitLicense in New York and more than 30 Money Transmitter licenses across the United States. These licenses were expected to position Ripple as a trusted and reliable partner for enterprises, especially given the ongoing legal challenges with the SEC.

Last month, Judge Analisa Torres granted the SEC's request to proceed with an appeal, challenging a previous court ruling that determined Ripple's sale of XRP cryptocurrency on a digital asset exchange did not breach securities regulations. This development sets the stage for the SEC to present its case for an interlocutory appeal, further prolonging the legal dispute.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

1 days ago

What Historically Happens to Bitcoin During a US Government Shutdown?

Bitcoin is a digital asset that is well-known for its durability and independence from traditional financial systems. However, even this decentralized powerhouse is vulnerable to the effects of big external events, such as US government shutdowns. We'll look at previous occurrences, the cryptocurrency's behavior, and the lessons learnt from these events to better understand the historical relationships between Bitcoin and US government shutdowns.

The Coincidence of Bitcoin and Government Shutdowns

When the US Congress fails to pass legislation funding federal agencies and services, the government shuts down. Non-essential government services are temporarily halted during such times, and federal employees may be furloughed or work without pay. These occurrences are frequently the result of political deadlock and fiscal conflicts.

As a decentralized digital money, Bitcoin works independently of government control. Market forces, supply and demand dynamics, and investor mood all influence its value. The bitcoin market, however, is not insulated from the broader financial environment, and events such as government shutdowns can have repercussions.

Government shutdowns and market turpitude

Increased market uncertainty is one prominent characteristic of Bitcoin's behavior during US government shutdowns. As the shutdown's duration and possible economic consequences remain unknown, investors and traders may become more risk-averse. This sentiment may spread to the bitcoin market, increasing price volatility.

Bitcoin has historically seen price changes during government shutdowns, with both upward and downward moves. The magnitude and direction of these price swings are frequently determined by a variety of factors, such as global economic conditions, investor sentiment, and the overall stability of financial markets.

Is Bitcoin a Safe Haven?

During times of economic and political crisis, Bitcoin has been promoted as a "safe haven" asset, similar to gold. Proponents believe that because of its decentralized nature and limited supply, it is an appealing store of value when traditional assets, such as fiat currencies or stocks, confront uncertainty.

Some investors may flock to Bitcoin during government shutdowns as a hedge against potential economic disruptions. This inflow of cash has the potential to enhance demand and, as a result, put upward pressure on Bitcoin's price. However, it is important to emphasize that Bitcoin's designation as a safe haven asset is debatable, and its behavior can vary from crisis to crisis.

A potential surge?

The looming threat of a United States government shutdown and debt ceiling standoff has once again sparked interest in Bitcoin's price performance. Historically, Bitcoin has responded positively to economic uncertainties, particularly during government shutdowns, witnessing price increases. However, the question on many minds is whether the current political deadlock will lead to a significant Bitcoin price surge.

Bitcoin's response to past government shutdowns has been mixed. For example, during the 2013 shutdown, Bitcoin's price surged over 80%, while during the 2018-2019 shutdown, its gains were more modest. The 2013 rally saw Bitcoin's price jump from around $133 to over $1,000, while during the 2018-2019 shutdown, its price increased from $3,207 to $4,244, but with higher volatility.

Bitcoin's price behavior during government shutdowns remains uncertain, but its potential as a safe-haven asset during times of economic uncertainty continues to attract attention and speculation from investors worldwide. As the U.S. grapples with its current challenges, all eyes are on Bitcoin to see how it responds to the evolving economic landscape.

Historical Illustrations

To obtain insight on Bitcoin's behavior during government shutdowns, let's look at two recent shutdowns:

1. The Government Shutdown of 2013:

Due to differences over the federal budget, the US government shut down for 16 days in 2013. During this time, Bitcoin saw significant price volatility. The price of cryptocurrencies fluctuated significantly, initially rising to record highs as some investors sought refuge in digital assets. However, as the closure continued, Bitcoin's price retraced, reflecting the concern in the broader market.

2. The Government Shutdown of 2018-2019:

The 35-day government shutdown, which began in December 2018 and lasted until January 2019, was the longest in US history. During this time, Bitcoin's behavior was more nuanced. While there was fluctuation, there was no continuous trend. Some investors viewed Bitcoin as a viable hedge, while others remained cautious in the face of persistent economic concerns.

Important Takeaways

Several major takeaways may be drawn from past data on Bitcoin's performance during US government shutdowns:

Increased Volatility: During government shutdowns, Bitcoin's price volatility often spikes, indicating market uncertainty and shifting investor opinion.
Mixed Reaction: The cryptocurrency's reaction to government shutdowns is not consistent. Depending on the circumstances, it might exhibit both upward and downward price swings.
Bitcoin is occasionally regarded as a potential hedge against economic turbulence, drawing investors looking for alternative assets during times of crisis.
Market Independence: Because Bitcoin is decentralized, it can operate independently of government activities, giving it some independence from existing financial institutions.
Bitcoin may reflect certain patterns during government shutdowns, but there are no certainties about how it will react in future occurrences. A complicated combination of factors influences the bitcoin market.

Looking Forward

As the cryptocurrency world evolves, it is critical for investors and traders to approach Bitcoin and other digital assets with a comprehensive grasp of their distinct qualities. While past data might provide insights, it's crucial to remember that the cryptocurrency market is still in its early stages and can be influenced by a variety of internal and external factors.

Prudent risk management measures are essential for people contemplating Bitcoin as part of their investing portfolio. Diversification, rigorous study, and a long-term view are useful strategies for navigating the volatility and flexibility of the bitcoin market.

Finally, Bitcoin's interaction with US government shutdowns highlights its status as a dynamic and changing asset class. While it may show signs of resilience and hedging potential, it is nevertheless vulnerable to the broader dynamics that affect financial markets. As government shutdowns and other external events continue, the cryptocurrency market's reaction will be widely followed, providing vital insight into Bitcoin's increasing role in the global financial scene.

This article was written by Pedro Ferreira at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Sam Bankman-Fried's High-Stakes Trial: Facing "Very Long Sentence"

Sam Bankman-Fried, the indicted Founder of the now-bankrupt crypto exchange FTX, may be staring at a "very long sentence" if convicted of fraud. The judge overseeing the trial starting next week expressed uncertainty about Bankman-Fried's future, suggesting serious consequences.

The comments by US District Judge Lewis Kaplan came in response to a request from the 31-year-old former billionaire, who sought temporary release from jail during the trial to facilitate closer coordination with his defense team.

"Flight Risk"

Kaplan denied this request, deeming Bankman-Fried a flight risk. "Your client in the event of conviction could be looking at a very long sentence," Judge Kaplan cautioned during a hearing at the Manhattan federal court.

Bankman-Fried, who has maintained his innocence, faces seven counts of fraud and conspiracy arising from the collapse of FTX in November 2022. If convicted, he could potentially be sentenced to a maximum of 110 years in prison, Reuters reported. While his legal team had argued for temporary release, citing the need for comprehensive trial preparations, Judge Kaplan acknowledged their concerns.

To address this, he committed to facilitating early morning meetings between Bankman-Fried and his attorneys, allowing crucial discussions and strategizing to occur before the commencement of trial proceedings.

SBF Accused of Witness Tampering

Danielle Kudla, the prosecutor, pointed out that Bankman-Fried had ample time to prepare for the trial during the nearly eight months he spent out on bail at his parent's residence in California. During this time, allegations of witness tampering surfaced, leading to his incarceration on August 11. One such instance involved Bankman-Fried allegedly sharing the private writings of Caroline Ellison, the former CEO of Alameda Research, with a New York Times reporter.

In addition, the prosecutors contended that Bankman-Fried and his legal team had not met the necessary burden of proof to justify temporary release. Additionally, they raised doubts about the adequacy of the proposed supervision arrangement, suggesting it might not meet the legal requirements for a temporary release.

The judge's decision means that Bankman-Fried will remain in jail for the trial, which centers on allegations about his role in FTX.

The trial of Sam Bankman-Fried is scheduled to commence on October 3 and could extend to over six weeks. The outcome of this trial holds significant implications not only for Bankman-Fried personally but also for the broader cryptocurrency ecosystem as it grapples with issues of trust, transparency, and accountability.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Fireblocks' $10 Million Acquisition to Enhance Tokenization Services

Blockchain unicorn Fireblocks has made a strategic move by acquiring Australia-based BlockFold, a smart contract development and consulting firm specializing in advanced tokenization projects for financial institutions.

This acquisition is estimated to be valued at $10 million. It is poised to enhance Fireblocks' ability to offer clients a comprehensive service layer that encompasses advisory services, token customization, orchestration, and distribution through the Fireblocks Network.

Expanding Fireblocks' Service Layer with BlockFold Acquisition

The decision to acquire BlockFold comes on the heels of rapid growth in demand for tokenization projects witnessed by Fireblocks. The company reported an impressive increase of 350% in tokenization projects between 2022 and 2023. Moreover, an astounding 75% of tier-1 financial institutions have been exploring tokenization through Fireblocks' platform.

Commenting on this development, Michael Shaulov, the Co-Founder and CEO at Fireblocks, noted: "BlockFold's expertise fills an important gap in the market, tailoring bespoke solutions for some of our most sophisticated customers and prospects in the banking and financial institutions space."

He added: "Bringing BlockFold's expertise in-house means that we can better serve tier-1 financial institutions to quickly and seamlessly bring tokenization projects into production and new assets onto the blockchain. In addition, we can continue to innovate and expand our offerings and tailor our approaches as the market continues to mature and evolve."

Fireblocks has taken the initiative to tokenize various financial assets. Since introducing the first bank-issued stablecoin for ANZ in March 2022, Fireblocks has successfully delivered over 10 stablecoin projects.

Moreover, it is actively engaged in exploring the creation of bank-issued stablecoins or tokenized deposits with more than 25 global banks. Within the next three years, Fireblocks envisions the value of tokenized money on the blockchain to reach an impressive $450 billion.

Fireblocks Sets Ambitious Targets for Tokenized Bond Values

From May 2023, Fireblocks enabled the Tel Aviv Stock Exchange and the Israeli Ministry of Finance to tokenize and settle a government bond after a live auction involving five domestic banks and seven global banks. As the sole issuers of Israeli government bonds, both parties now have a credible path to tokenize Israel's government debt market, valued at $15 billion annually.

Fireblocks has set ambitious goals. The firm is targetting the value of tokenized bonds on the blockchain to reach $400 billion within the next three years. It assumes these targets with a long-term vision of hitting $1 trillion by 2028.

BlockFold's esteemed clientele, which are also existing Fireblocks customers, include major institutions such as the Bank of International Settlements, Swiss National Bank, Banque de France, Singapore's Ministry of Finance, Tel Aviv Stock Exchange, National Australia Bank, and ANZ Bank.

BlockFold Team Integration Strengthens Fireblocks

The BlockFold team has joined forces with Fireblocks as a component of the integration process. Additionally, the engineering team has merged to be part of the Web3 engineering staff. The business consulting team is fusing with the Financial Markets group. Francois Schonken, a Co-Founder, has been appointed to Senior Director and Tokenization Business Lead at Fireblocks. Further, Terence Siganakis, another Co-Founder, will take on the role of Senior Director and Head of Tokenization Products.

This acquisition is expected to solidify Fireblocks' position in the blockchain and tokenization space. It will enable it to provide a broader range of services to its client base in the financial industry.

The world of blockchain and tokenization is continuing to evolve. Fireblocks' strategic acquisition of BlockFold is positioning itself to navigate the changing landscape and deliver innovative solutions to its clients. Market participants and financial institutions will be closely monitoring Fireblocks' future developments as the company plays a role in the digital transformation of the financial sector.

This article was written by Tareq Sikder at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Binance Embroiled in SEC Lawsuit - What You Need to Know

Binance, one of the world's largest and most influential cryptocurrency exchanges, has found itself embroiled in a lawsuit with the U.S. Securities and Exchange Commission (SEC). This case has far-reaching consequences for the cryptocurrency sector, Binance users, and the US regulatory landscape. We examine the specifics of the SEC complaint against Binance, as well as what it means for the exchange and how it may affect the broader cryptocurrency market.

Allegations Made by the SEC

The SEC's charges against Binance, accusing the exchange of enabling securities trade without registering as a securities exchange, are at the center of the complaint. According to the SEC, certain assets listed and traded on Binance's platform qualify as securities under US law, and hence the exchange must follow securities regulations.

The SEC's position is clear: if a business trades securities, it must follow the established regulatory structure meant to protect investors and maintain market integrity. Failure to do so may result in legal action, as seen in the instance of Binance.

Binance's Reaction

Binance, led by its founder Changpeng Zhao (abbreviated "CZ"), has categorically refuted the SEC's charges. The exchange claims that it does not operate inside US jurisdiction and that it complies with all relevant rules in the nations where it operates.

Furthermore, Binance claims that the assets in question, such as certain cryptocurrencies and tokens, are utility tokens or digital assets rather than securities. According to Binance, this designation exempts them from U.S. securities laws.

Binance's legal team is preparing a strong defense, intending to fight the claims in court. Because it touches on the fundamental question of jurisdiction in the international realm of digital assets, the outcome of this judicial struggle could establish a precedent for how cryptocurrency exchanges are regulated globally.

Binance Granted Extension in Ongoing SEC Lawsuit

In the ongoing legal battle between Binance and the U.S. Securities and Exchange Commission (SEC), the U.S. District Court has granted an extension for Binance to respond to court orders. The court orders require Binance to explain the reasons behind sealing or redacting specific documents.

Key Points:

The extension motion was approved by Judge Zia M. Faruqui of the U.S. District Court for the District of Columbia.
BAM Trading and BAM Management, associated with Binance, now have until September 27th to respond to the court orders.
The first court order relates to explaining the sealing or redaction of documents related to the SEC's motion to compel discovery.
The second order concerns justifying the sealing of documents tied to the SEC's response supporting its motion to compel.

Importantly, the SEC did not oppose the request for the extended deadline.

Binance's Response to SEC Allegations

The lawsuit involves Binance, its founder Changpeng Zhao, and two U.S.-based Binance entities, BAM Trading Services Inc. and BAM Management U.S. Holdings Inc. The SEC alleges that these entities sold digital asset securities without proper registration.

Binance, Binance.US, and Changpeng Zhao have counteracted the SEC's claims by seeking to dismiss the lawsuit. They argue that the SEC has not provided plausible allegations of various securities-related violations and that the regulator is attempting to exert authority over digital assets without clear legislative backing from Congress.

The legal dispute is ongoing, with further developments expected as the case progresses. Please note that the information provided here is for general market commentary and should not be considered investment advice. Conducting personal research before making investment decisions is recommended.

The Consequences for Binance

Binance has already suffered severe consequences as a result of the case. Binance said that it would discontinue selling digital tokenized stock offers, a service that allowed users to acquire and trade fractionalized shares of publicly traded firms, in reaction to the SEC's legal action. This is considered as a strategic withdrawal in order to reduce regulatory vulnerability in the United States.

Binance also stated its ambition to work with regulators while remaining committed to global compliance. This shift toward regulatory compliance and cooperation signals a substantial break from Binance's previous, more decentralized strategy.

These modifications may affect the availability of some assets and trading opportunities for Binance users. The exchange may be required to delist or restrict trading in assets that meet the SEC's definition of securities, possibly reducing the range of digital assets available to consumers.

Implications for the Cryptocurrency Industry at Large

The SEC's complaint against Binance is part of a larger trend of growing regulatory scrutiny in the cryptocurrency market. As the industry continues to expand at a rapid pace, regulators throughout the world are wrestling with how to define and regulate digital assets.

This lawsuit could represent a tipping point for how other cryptocurrency exchanges deal with regulatory issues. To prevent legal entanglements, exchanges may choose to proactively comply with local legislation, akin to Binance's recent strategic shift.

Furthermore, the conclusion of this case may have an impact on the development and issuance of new digital assets, as issuers and projects may be wary of generating tokens that could be categorized as securities.

Market Influence

The SEC case against Binance had an immediate effect on the bitcoin market. Following the announcement, the prices of various tokens affiliated with the exchange fell precipitously. Investor sentiment was shook as doubt loomed over Binance's future.

Market participants are keeping a close eye on the situation, and the legal processes are likely to continue to influence market sentiment and the valuation of Binance-related assets.

What to Look Out For

The Binance-SEC litigation is set to be a watershed moment in the cryptocurrency sector, having ramifications far beyond the individuals involved. Here are some critical aspects to watch as the court battle unfolds:

Legal Outcomes: The court's judgements and decisions throughout the case will provide important insights into how bitcoin exchanges will likely be regulated in the United States.
Regulatory Reaction: Regulators all around the world will be keeping a careful eye on this issue. Depending on the conclusion, other nations' regulatory bodies may take similar action against exchanges.
Binance's Strategy: The cryptocurrency community will be keenly interested in Binance's response to the lawsuit, particularly any future changes to its business model and attitude to compliance.
Market Impact: Continue to monitor market reactions to the lawsuit's progress. Prices can be influenced by market emotion, and cryptocurrency markets are notorious for their volatility.

Conclusion

The SEC's case against Binance comes at a critical juncture in the growing relationship between cryptocurrency exchanges and authorities. While the outcome is unknown, it emphasizes the importance of clear regulatory norms in the bitcoin business.

This case also serves as a reminder to cryptocurrency market participants, including investors and traders, to stay up to date on regulatory developments and to proceed with prudence. The cryptocurrency landscape is constantly changing, and compliance with local rules is becoming increasingly important for the sector's long-term survival and growth.

As the legal struggle unfolds, staying up to current on the latest developments and insights from legal experts and industry leaders will be critical. The cryptocurrency industry is at a crossroads, and the Binance-SEC lawsuit will almost certainly impact its future trajectory in important ways, with far-reaching ramifications that go beyond this high-profile case.

This article was written by Pedro Ferreira at www.financemagnates.com.

Source : Finance Magnates

2 days ago

US Prosecutors Oppose Temporary Release Request by Sam Bankman-Fried

In a court filing on Wednesday (yesterday), the U.S. Department of Justice (DOJ) firmly opposed the renewed motion for temporary release filed by Sam Bankman-Fried, the Founder of the cryptocurrency exchange FTX, ahead of his upcoming trial.

The motion sought his temporary release with stringent restrictions. However, it has been met with strong resistance from prosecutors. They contend that the arguments put forth by Bankman-Fried's legal team lack specificity and fail to establish a compelling case for his release.

DOJ's Opposition to Bankman-Fried's Release

Bankman-Fried had requested temporary release into the custody of his attorneys. He offered to comply with measures such as being closely guarded outside the courtroom. He would also surrender electronic devices such as laptops and phones to address concerns about being a potential flight risk or further legal violations.

However, the DOJ argued that these proposed conditions did not meet the legal requirements for a defendant's release. In their court filing, prosecutors stated: "The defendantâ€™s repeated general assertions regarding the inconveniences of his detention simply do not outweigh the dangers of his release in light of the record, as affirmed by the Circuit, regarding his course of conduct over time."

Judicial Denials of Bankman-Fried's Release Requests

Both Judge Lewis Kaplan, who presides over Bankman-Fried's trial, and an appeals court have previously denied Bankman-Fried's requests for release. Judge Kaplan's earlier order denying the request for "temporary release" cited a lack of compelling reasons for the release.

Specifically, Judge Kaplan noted that Bankman-Fried had not provided clear explanations for how he could contribute to his defense outside of detention. Especially, considering the months he had spent out on bail prior to his detention. Judge Kaplan has scheduled a hearing for 10:00 am Eastern Time on Thursday. The outcome of this hearing will determine whether Bankman-Fried will remain in detention pending his trial, which is scheduled to begin next month.

The legal battle surrounding Bankman-Fried continues to draw significant attention from both the cryptocurrency and legal communities. It raises important questions about pretrial detention and the rights of defendants in high-profile cases.

This article was written by Tareq Sikder at www.financemagnates.com.

Source : Finance Magnates

2 days ago

Time to Convert Your Binance Euros: Platform Advises Shift to USDT

After withdrawing support for GBP payments in May, Binance is now suspending EUR operations offered through Paysafe. Although the news of the exchange's suspension of its partnership with the payment company in Europe has been known for several months, the platform today (Thursday) suggested that its users begin converting their euros to USDT.

Binance Advises Users to Convert EUR to USDT

According to a statement released by Binance, Paysafe "unilaterally decided" to cease processing euro deposits for the exchange's users. As a result, the platform advises traders to take certain preemptive measures, encouraging them to transfer their euros to Tethers, one of the most popular stablecoin.

The exchange recommends that users complete the conversion before 31 October. "The sudden and inexplicable decision by Paysafe will cause a brief interruption to the following services. We apologize for any inconvenience," Binance commented in an official statement.

The collaboration between Paysafe and Binance began in March last year, enabling exchange users to deposit and withdraw funds in euros and pounds and trade in pairs quoted in EUR and GBP. However, in May 2023 Paysafe withdrew its services from processing payments in pounds, citing regulatory uncertainty in the UK.

A month later, the partnership with Binance was completely severed following a "strategic review" and growing regulatory concerns. This occurred during a period when the exchange was already grappling with lawsuits from American oversight commissions, and more European regulators were expressing negative views about its operations.

As of 28 September, users no longer have the option to buy and sell cryptocurrencies in euros or trade EUR spot trading pairs. Moreover, since the beginning of the week, most traders can no longer make euro deposits using Paysafe. However, Binance assures that euro withdrawals to bank accounts will continue to be possible without interruptions.

"Meanwhile, users may continue to withdraw their EUR balances from Binance accounts to their bank accounts," Binance added. The exchange also assures that it is working on integrating new fiat payment channels in Europe to "provide a seamless crypto experience for all users."

Binance Exits Russia, Reopens in Belgium

A lot is happening around Binance lately. Just yesterday, the exchange announced that it is completely exiting Russia and selling its business to the newly established exchange CommEX. Interestingly, the mentioned exchange officially launched its operations a day before releasing this information.

Additionally this week, the exchange announced that it is resuming its operations in Belgium. Although it had to suspend them earlier due to an order from the local regulator, it has decided to move its Belgian clients to Poland. European Union laws allow the exchange to manage clients' accounts and provide services from a registered entity in another country.

Finance Magnates reported that Binance is participating in a project to create Japan's stablecoin and accelerate the adoption of Web3 in that part of the world. According to estimates, the value of the local stablecoin market is expected to reach $34 billion.

This article was written by Damian Chmiel at www.financemagnates.com.

Source : Finance Magnates

2 days ago

Do Kwon Fights Back: Opposes SEC's Terraform Labs Probe

Terraform Labs' Founder, Do Kwon, has opposed attempts by the US Securities and Exchange Commission (SEC) to extradite him for questioning regarding the collapse of Terra LUNA and the stablecoin TerraUSD.

Kwon's defiance became evident with a recent court filing, submitted in the US District Court for the Southern District of New York, where he seeks to dismiss the SEC's request for his testimony in the US. His legal team said such a step is impossible due to Kwon's detention in Montenegro. Additionally, the filing states that compelling him to provide a written testimony would infringe upon his rights under the laws of the US.

Do Kwon Contests SEC's Extradition Pursuit

In a statement within the filing, Kwon's lawyers said: "The SEC's motion seeks leave to take the deposition of Defendant Do Kwon in the United States before October 13, 2023, even though the SEC knows that Kwon is detained in Montenegro with no scheduled release or extradition date. The motion should be denied because it would be impossible for Kwon to appear for such a deposition."

The SEC's legal pursuit of Terraform Labs dates back to February when they filed a lawsuit accusing the company of misleading investors regarding the safety of investing in TerraUSD. Investors were assured that TerraUSD would maintain its peg to the US dollar through a complex mint-burn system involving its sister coin, LUNA. However, the downfall of both TerraUSD and LUNA in May 2022 resulted in an estimated loss of $50 billion to investors.

Currently, the US and South Korea are seeking the extradition of Kwon. In March, Montenegro's Minister of Justice, Marko Kovac, revealed that a judge will ultimately determine whether Kwon will be extradited to the US or South Korea, Bloomberg reported.

Kwon, who served as the CEO of Terraform Labs, was hit with criminal charges in March by federal prosecutors in New York. The charges were brought against him just hours after his arrest in Montenegro.

Do Kwon Faces Eight Counts of Charges in the US

The federal court in the Southern District of New York officially filed eight charges against Kwon, all related to his alleged involvement in the ill-fated stablecoin project. These charges include commodities fraud, securities fraud, wire fraud, and conspiracy to defraud and engage in market manipulation.

In addition, previous reports indicate that the Federal Bureau of Investigation (FBI) and the prosecutors from the Southern District of New York are actively investigating the collapse of TerraUSD. This investigation includes interviews with former employees of Terraform Labs.

In June, Kwon was handed a four-month jail sentence by a court in Montenegro for alleged possession of forged passports and travel documents. This verdict also applied to Han Chong-Joon, the former Chief Financial Officer at Terraform Labs, who faces identical charges.

Kwon and Chong-Joon were arrested in March in Montenegro as they were attempting to board a plane bound for Dubai. The court disclosed that fake Costa Rican and Belgian passports and falsified identity cards were confiscated from the executives during their arrest.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

2 days ago

Coinbase CEO Criticizes Chase UK's Crypto Ban

Brian Armstrong, the CEO of Coinbase, one of the US' largest cryptocurrency exchanges, has criticized JPMorgan Chase UK's recent decision to prohibit its customers in the UK from engaging in crypto-related transactions. Armstrong expressed his discontent on X (formerly Twitter) on September 26, labeling Chase Bank's actions as "totally inappropriate".

Armstrong Requests Chase UK's Crypto Transaction Ban Investigation

In his tweet, Armstrong called upon UK crypto holders to consider closing their accounts with Chase UK if they continue to face such restrictions. He also urged UK officials, including Prime Minister Rishi Sunak and the Economic Secretary, Andrew Griffith, to investigate whether Chase UK's actions align with the country's policy objectives.

Armstrong maintained a hopeful tone. He suggested that there might be more to the situation than initially apparent, having stated: "Really hoping there is more to this story than meets the eye, and that this does not reflect Chase UK's actual view."

Chase UK confirmed its decision on September 26. It cited that a significant level of fraud in the crypto space as the primary reason for the ban. The bank clarified that customers attempting to make crypto-related transactions would receive a declined transaction notification.

Coinbase officially supports the UK market alongside the US, Europe, and Canada, as stated on its website. The platform has been actively pursuing its expansion efforts in the UK, as evidenced by its commitment to its growing presence in the region, announced in April 2023. The firm continues to expand globally. However, it faces legal challenges in its home country.

In June 2023, the U.S. Securities and Exchange Commission filed a lawsuit against Coinbase, alleging violations of securities laws. This ongoing legal battle further underscores the evolving regulatory landscape surrounding cryptocurrencies and exchanges worldwide.

Totally inappropriate behavior from @Chase UK (this is their UK bank only is my understanding)@RishiSunak @griffitha It appears @Chase UK does not respect your policy goals - thoughts?UK crypto holders should close their @Chase accounts if this is how they're going to beâ€¦ https://t.co/n8OBxhtpcg
â€” Brian Armstrong ðŸ›¡ï¸ (@brian_armstrong) September 26, 2023

Traditional Banks Tighten Grip on Cryptocurrency Activities

JPMorgan's retail branch, Chase UK, has joined Santander and NatWest in prohibiting cryptocurrency transactions, reflecting a global trend. While officially attributed to surging cryptocurrency-related crimes, it underscores traditional institutions' broader efforts to enhance security within the digital asset sphere.

Chase UK announced on Tuesday its decision to block all cryptocurrency transactions for customers from October 16. It cited a rising wave of scams targeting UK consumers. This move signifies a proactive approach to safeguarding customers, despite the undisclosed specifics of the scams. It aligns with a worldwide movement to foster a secure environment for cryptocurrency investors amid evolving financial landscapes.

This article was written by Tareq Sikder at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Is a Grayscale Spot Bitcoin ETF Likely to Happen?

The financial industry has been buzzing over the prospect of a Grayscale Bitcoin Exchange-Traded Fund (ETF). Grayscale Investments is well-known for its Grayscale Bitcoin Trust (GBTC), which allows investors to obtain exposure to Bitcoin through standard brokerage accounts.

However, there has been an increase in demand for a Grayscale Spot Bitcoin ETF, which would track the actual price of Bitcoin.

The Ascension of Bitcoin ETFs

ETFs (Exchange-Traded Funds) have become a popular way for investors to gain exposure to Bitcoin. These exchange-traded funds offer a straightforward and regulated way to acquire and sell Bitcoin without the need for a digital wallet or direct ownership of the cryptocurrency. Investors instead hold ETF shares, which reflect a claim on the underlying Bitcoin.

Several Bitcoin ETFs have already hit the market in different nations. In Canada, for example, the Purpose Bitcoin ETF and the Evolve Bitcoin ETF have received a lot of attention and money. Meanwhile, multiple applications for Bitcoin ETFs have been filed in the United States, with several awaiting approval from the Securities and Exchange Commission (SEC).

The Dominance of Grayscale

Grayscale Investments, which was launched in 2013, has been instrumental in bringing digital assets into the mainstream financial scene. The Grayscale Bitcoin Trust (GBTC), its flagship product, allows accredited investors to obtain exposure to Bitcoin. GBTC has emerged as a popular choice among institutional investors and high-net-worth people seeking regulated exposure to cryptocurrencies.

While GBTC is widely used, it has one major distinction: it does not directly track the actual price of Bitcoin. It is instead based on the Bitcoin Investment Trust, which holds Bitcoin but lacks the transparency and liquidity of a typical ETF.

The Case for a Bitcoin Grayscale Spot ETF

The desire for a product that closely matches the actual price of Bitcoin drives the demand for a Grayscale Spot Bitcoin ETF. An ETF of this type would give investors a more direct and transparent option to invest in cryptocurrency. It would eliminate the premium or discount to NAV that GBTC can suffer, bringing the ETF's price in line with the spot market.

Investors are interested in a Grayscale Spot Bitcoin ETF as a way to get efficient and cost-effective Bitcoin exposure. A spot-based ETF may also offer lower expenses than GBTC, which charges a management fee.

Regulatory Obstacles

The regulatory roadblocks to implementing a Grayscale Spot Bitcoin ETF are numerous. The biggest impediment is the US Securities and Exchange Commission, which has been cautious and deliberative in its approach to issuing Bitcoin ETFs. Concerns about market manipulation, fraud, and investor protection have been cited as grounds for the SEC's reluctance.

The SEC considers the integrity of the underlying Bitcoin market to be one of the most important aspects. The agency seeks confirmation that the Bitcoin market is resistant to manipulation and fraud, which has resulted in prior Bitcoin ETF applications being delayed or rejected.

The SEC's Position on Bitcoin ETFs

Over the years, the SEC has rejected various Bitcoin ETF proposals, citing concerns about market manipulation and investor safety. To detect and prevent fraud and manipulation, the SEC has underlined the importance of surveillance-sharing agreements between ETF issuers and regulated markets.

However, there are hints of change within the SEC. There appears to be a stronger desire to engage with the digital asset market under the leadership of Chairman Gary Gensler, who has an experience in blockchain and cryptocurrencies. Chairman Gensler highlighted the potential benefits of a Bitcoin ETF, but he also emphasized the importance of strong market surveillance systems.

The Next Steps

Several actions must be performed in order for a Grayscale Spot Bitcoin ETF to become a reality:

Market Maturity: The Bitcoin market needs to mature further, including improvements in market integrity, surveillance, and regulatory compliance. This would increase the SEC's confidence in approving a spot-based ETF.
Regulatory discussion: It is critical to maintain ongoing discussion between industry stakeholders and regulatory agencies. Collaboration can aid in the resolution of regulatory concerns and the development of a framework that promotes investor protection and market integrity.
Market Surveillance: It is critical to create and implement effective market surveillance techniques and agreements. These techniques can assist in monitoring and deterring fraudulent actions, ultimately giving the SEC with the guarantees it requires.
Investor Education: As the bitcoin industry develops, investor education will become more vital. Providing clear and accurate information about Bitcoin, ETFs, and associated risks can help investors and regulators develop trust and confidence.
Regulatory Approval: The SEC has the final say on whether or not to approve a Grayscale Spot Bitcoin ETF. Continued involvement with the agency, together with improvements in the sector and market maturation, may raise the likelihood of approval.

The Market's Reaction

The financial markets have been keeping a close eye on developments concerning a Grayscale Spot Bitcoin ETF. If such an ETF is approved, it might have far-reaching consequences for both the cryptocurrency and traditional financial markets. Increased openness and accessibility in Bitcoin investing may attract a broader spectrum of investors, thereby promoting further adoption and market expansion.

Investors are also aware of the potential benefits of a Grayscale Spot Bitcoin ETF, such as lower costs and tighter alignment with Bitcoin's spot market price. This could enhance demand for the ETF when it launches.

The Ethereum Opportunity

A recent federal judge's ruling has cast a shadow on the U.S. Securities and Exchange Commission's rejection of converting the Grayscale Bitcoin Trust into a more appealing exchange-traded fund. The decision has shifted market sentiment, with many analysts now anticipating approval for a spot Bitcoin ETF sooner rather than later. Bloomberg analysts have even placed the odds of approval this year at 75%.

This optimism is reflected in market prices, not only for Grayscale's Bitcoin product but also for its Ethereum Trust (ETHE). Both GBTC and ETHE had previously traded at significant discounts to their Net Asset Value (NAV), which represents the value of the Bitcoin and Ethereum they hold. However, these discounts have notably narrowed, with GBTC going from a 46% discount to only 21%, and ETHE from 59% to 29%.

The prevailing theory suggests that bullish investors should acquire GBTC and await final approval for a Bitcoin ETF. It is anticipated that the discount will largely disappear, as open-ended ETFs typically trade at narrow differences to NAV. Additionally, the underlying asset, Bitcoin, may experience increased demand, resulting in a win-win scenario. While this theory holds merit, there may be an even greater opportunity with Grayscale's Ethereum Trust.

The argument to be made here is that if a U.S. spot Bitcoin ETF gains approval, a similar spot Ether ETF should follow suit. Grayscale has already indicated its plans to convert ETHE and other products into ETFs. Given the track record of Ethereum ETFs launching shortly after the first Bitcoin ETF, it is reasonable to expect a swift approval process. Regulators in Canada approved Ethereum ETFs due to the presence of a regulated futures market for ETH, allowing market makers to hedge risk while creating and redeeming units. ETHE's discount is more significant than GBTC's, offering a potentially larger arbitrage opportunity. Furthermore, ETH markets are less liquid than BTC, meaning that an ETF's incremental buying could have a more substantial impact on its price. Additionally, Ethereum holds significant potential as the leading platform for Web3 development.

Conclusion

The possibility of a Grayscale Spot Bitcoin ETF excites the cryptocurrency and investing sectors. While regulatory hurdles remain, there is rising confidence about the eventual approval of such an ETF, particularly under the leadership of SEC Chairman Gary Gensler.

The route to a Grayscale Spot Bitcoin ETF becomes clearer as the sector matures and market participants collaborate to address regulatory concerns. Investors and industry stakeholders will be on the lookout for any changes, as the introduction of such an ETF may be a watershed moment in the integration of digital assets into traditional finance.

This article was written by Pedro Ferreira at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Geminiâ€™s Founders Face Scrutiny over $280M Crypto Withdrawal amid Genesis Crisis

Cameron and Tyler Winklevoss, the Co-Founders of Gemini, are under scrutiny over an alleged secret withdrawal of $282 million from the now-bankrupt crypto lender, Genesis. This withdrawal occurred just months before the entire crypto firm collapsed, according to a report by the New York Post.

Cameron and Tyler Winklevoss have been grappling with a series of setbacks in recent times, including layoffs and plummeting trading volumes at Gemini. However, the focus changed when over $900 million in Gemini customer deposits were frozen due to the collapse of Genesis, the crypto lending platform that facilitated Gemini Earn, an interest-bearing program.

Gemini's Crypto Drama Unfolds

The Winklevoss twins' decision to withdraw millions of funds from Genesis has raised concerns about whether these funds were corporate assets or part of their personal crypto holdings. However, the withdrawn sum did not include any customer funds.

Internal documents revealed that this sizable withdrawal comprised a mix of cryptocurrencies, including Bitcoin, Ethereum, Gemini's stablecoin, Dogecoin, and more. The timing of the move, mere months before the suspension of customer withdrawals by Genesis, hints they knew it might happen and potentially undermine their claims of innocence, The Post reported.

In response, Gemini has criticized the New York Post's report, terming it as "misleading".

The exchange said on X (formerly Twitter): "The $282 million that was withdrawn from Genesis in August 2022 was in fact Earn usersâ€™ money. It was not Gemini corporate funds and it was not the personal funds of our Founders @cameron and @tyler or their investment firm @winklevosscap."

We are disappointed that the @nypost has chosen to recklessly publish a completely misleading story about the Gemini Earn program. Everything the Post alleges in its story is the exact opposite. The $282 million that was withdrawn from Genesis in August 2022 was in fact Earnâ€¦
â€” GeminiTrustCo (@GeminiTrustCo) September 28, 2023

Winklevoss sued DCG, the parent company of Genesis, and its CEO, Silbert, for allegedly providing misleading information about Genesis's financial health. The lawsuit stated that DCG offered a promissory note instead of the promised financial backing. Despite their efforts to exit the Gemini Earn partnership, the Winklevoss twins claim that Silbert convinced them otherwise during a face-to-face meeting.

Recently, Genesis Global Trading, a subsidiary of Genesis Global, announced the imminent closure of its US-focused spot crypto trading operations, set to take effect by the end of this month. Besides that, Genesis Global Trading announced plans to cease the operations of its over-the-counter trading platform. However, another trading-focused entity affiliated with Genesis, Genesis Global Capital International Limited (GGC), is expected to continue GGT's spot and derivatives trading services.

FTX Settlement and Ongoing Legal Clash

Genesis' troubles are traced back to a dispute with the now-bankrupt cryptocurrency exchange FTX. FTX had asserted that Genesis owed a staggering $2 billion but recently settled for a payment of $175 million to Alameda Research, its affiliated crypto hedge fund. This settlement provided the possibility of substantial recoveries for unsecured creditors, ranging from 70% to 90% in USD equivalent.

Adding to the complexity of Genesis' financial woes is an ongoing legal dispute with Gemini. Gemini has accused DCG and its CEO, Barry Silbert, of involvement in "encouraging and facilitating" fraudulent activity through Genesis. In response, DCG has denied these allegations, labeling them as baseless and defamatory, characterizing the lawsuit as a "publicity stunt."

Genesis found itself in financial turmoil after filing for bankruptcy protection in New York due to the collapse of Three Arrows Capital (3AC) and FTX. The Ad Hoc Group reported Genesis' exposure to 3AC at $2.3 billion, subsequently reduced to $1.2 billion after collateral liquidation.

Earlier this year, the SEC sued Gemini and Genesis, contending that Gemini Earn violated regulations by offering unregistered securities. However, in a court document filed on August 18, Gemini has dismissed the allegations on the basis that the SEC is unable to define the nature of the alleged unregistered security clearly.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

2 days ago

Coinbase Secures Bermuda Regulatory Approval for Perpetual Futures Trading

Coinbase International Exchange has achieved a notable milestone by obtaining regulatory approval from Bermuda's financial regulator. This approval will enable eligible non-U.S. retail customers to participate in perpetual futures trading.

Coinbase's Next Offering: Access to Perpetual Futures Contracts

In a blog post released today (Thursday), Coinbase acknowledged the pivotal role played by the Bermuda Monetary Authority in facilitating this regulatory approval. As a result of this collaboration, Coinbase intends to offer eligible customers access to perpetual futures contracts on its Coinbase Advanced platform in the coming weeks.

Perpetual futures contracts are a type of derivative market known for their unique characteristic of never expiring. This perpetual nature makes them an attractive instrument for traders and investors seeking to engage in cryptocurrency markets without the constraints of fixed maturity dates.

"As announced in the Phase II of our 'Go Broad, Go Deep' strategy, we are dedicated to partnering with high-bar global regulators to build a crypto regulatory framework that allows crypto technology to continually drive innovation," the blog said.

JUST IN: Coinbase approved to offer perpetual #Bitcoin futures to global retail customers pic.twitter.com/WQVMlxaFTM
â€” Bitcoin Magazine (@BitcoinMagazine) September 28, 2023

The Significance of Regulatory Collaboration in Crypto

Coinbase International Exchange announced its international exchange initiative in May of the current year. The listing of Bitcoin and Ethereum perpetual futures contracts followed it.

This approval underscores the importance of collaboration between crypto firms and regulators in shaping the future of digital finance. It also reflects the company's commitment to providing a safe and regulated environment for cryptocurrency trading and investment.

Coinbase's Service Termination in India Targets Violators

Coinbase is reportedly limiting its services in India. With a Finance Magnates report indicating that, the exchange is partially or fully terminating its offerings in the country. New signups for Indian users have been suspended. Rather it redirects them to download Coinbase Wallet, a self-custody crypto wallet.

According to TechCrunch, Coinbase sent emails to its Indian customers. It notifies them of the service termination, effective from September 25. It also encourages them to withdraw their funds. However, a Coinbase spokesperson clarified that this service termination only applies to Indian customers who have violated the exchange's standards. The spokesperson stated that the exchange is discontinuing services for accounts that no longer meet their updated standards.

This article was written by Tareq Sikder at www.financemagnates.com.

Source : Finance Magnates

2 days ago

Kraken Dives into Traditional Markets: Targets US Stocks and ETFs

The cryptocurrency exchange Kraken plans to expand its services by venturing into the US-listed stocks and the exchange-traded funds (ETFs) sector. According to a report by Bloomberg, Kraken is preparing to introduce trading services for traditional assets, with a target launch date set for 2024.

These services will be offered through a newly established division known as Kraken Securities, which is expected to facilitate stock and ETFs trading. The division initially catered to customers in the United States and the United Kingdom.

Kraken's Regulatory Compliance and Expansion

Kraken has reportedly taken proactive steps to ensure regulatory compliance and secure its position as a legitimate player in these markets. Notably, the exchange has already secured the necessary regulatory permits in the United Kingdom and has submitted an application to the Financial Industry Regulatory Authority for a broker-dealer license in the United States.

The expansion follows a challenging year for the cryptocurrency industry, which ensued Bitcoin's peak of nearly $69,000. However, this shift into equities is not without its challenges, as Kraken will enter a competitive landscape populated by zero-commission platforms like Robinhood Markets.

Upon the launch of stock trading services on Kraken, eligible customers will have the opportunity to activate this feature. Those who do so will see their portfolios, comprising crypto, stocks, and ETFs, presented as a single balance. This integration aims to streamline the trading experience and offer customers greater convenience.

Kraken's expansion into equities is not an isolated endeavor. The exchange is strengthening its prime brokerage services concurrently and preparing to launch custody services for institutional clients in the coming weeks. The custody service will operate independently from the exchange, and Kraken has sought approval from the state of Wyoming for this initiative, sources familiar with the matter told Bloomberg.

Kraken Eyes Geographical Expansion

On top of that, Kraken has strengthened its presence in Europe. The exchange has announced two pivotal authorizations. The Central Bank of Ireland recently granted Kraken the status of an E-Money Institution (EMI), and the company has successfully registered as a virtual asset service provider with the Bank of Spain.

Kraken's EMI license, held by its Irish subsidiary, opens the door to a broader range of services in the European market. It enables Kraken to extend its fiat services in Euros in collaboration with European banks. Notably, this expansion encompasses clients across 27 European Union member states and European Economic Area countries.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

3 days ago

Offering Crypto in the UK? Follow These 10 Points to Abide by the New Rules

Following the implementation of the Consumer Duty rules in the United Kingdom, crypto providers in the country are now required to comply with a fresh set of regulations around promotions, the deadline for which is approaching. From 8th October, the coverage of the UKâ€™s Financial Services and Markets Act will be extended to â€œqualifying crypto assetsâ€, requiring crypto firms to follow several sets of rules.

But, what is the definition of "qualifying crypto assets"? According to the Financial Conduct Authority (FCA), it covers â€œany cryptographically secured digital representation of value or contractual rights that is transferable and fungible, but does not include crypto assets which meet the definition of electronic money or an existing controlled investment.â€

Although the overall rules look brief, there are many details crypto companies need to consider, otherwise they will risk committing a criminal offense.

UK's New Crypto Marketing Rules

The FCA supervises and enforces the implementation of the UKâ€™s financial promotion regime. Lucy Castledine, the Director of Consumer Investments, has warned that: â€œCome 8th October, we will be taking action against firms illegally marketing to UK consumers.â€

From this date, a financial promotion pertaining to qualifying crypto assets could only be lawfully made through one of four routes:

an authorised person communicating the promotion;
an authorised persons approving the promotion (known as a â€œsection 21 approverâ€);
a crypto firm registered under the Money Laundering Regulations communicating its own promotion; or
the promotion otherwise complies with the condition of an exemption in the FPO.

Failure to comply with the requirements of the extended financial promotions regime could lead to restrictions on the company, inclusion in the warning list, and order to take down websites. In extreme cases, the violations could lead to the imprisonment of the responsible person for up to two years or an unlimited fine, or both.

ðŸš¨ Final Warning from UK FCA ðŸš¨The Financial Conduct Authority (FCA) is taking a tough stance on crypto promotions! ðŸ“£As of Oct. 8, all firms marketing crypto assets to UK consumers must comply with new regulations. However, only 24 out of 150 firms responded to the FCA'sâ€¦
â€” BuzzBeatHQ ðŸš€ (@mely_buzz) September 21, 2023

Decrypting the Potential Challenges

The incoming rules will apply to all cryptocurrency companies, local or offshore, offering services in the UK. Although the overall rules cover a broad area, companies need to consider minute details. Some of the potential challenging elements of these rules are:

1. Applicable to all crypto firms promoting "qualifying crypto assets" to UK consumers: Given that the internet transcends international borders, there is a serious risk that people based outside the UK will be caught out with the UKâ€™s financial promotion rules for crypto assets. If a non-UK natural or legal person communicates a financial promotion to a UK consumer without using one of the four channels stipulated in the regime, this would result in the commission of a criminal offence.

The key consideration for any crypto firm, whether based inside or outside the UK, should be if a UK consumer could access and respond to its crypto asset promotion.

To avoid any violations, these companies should either prevent UK consumers from accessing those communications post 8th October 2023; or adhere to one of the four guidelines of the UK government.

2. The financial promotion regime is technology â€œneutralâ€: Materials distributed by any medium are capable of being deemed financial promotions subject to the rules. This includes communication by website, apps such as WhatsApp and Telegram, voice campaigns, social media campaigns as well as traditional print media. It is worth making an inventory of how, when and where promotions are being made.

3. A payment or electronic money institution cannot communicate or approve financial promotions: Under the incoming rules, companies will need to make arrangements to communicate crypto asset promotions through one of the four permitted routes previously mentioned above.

4. Brand advertising risks should be evaluated: It is quite common for brokerages to partner with sports clubs to raise awareness of their brand. Normally, â€œpureâ€ brand advertising falls outside the scope of the FCAâ€™s financial promotion rules. However, if materials do more than merely provide a logo, firmâ€™s name and contact information then there is an increased risk that they will be caught by the financial promotion rules. Accordingly, if relevant, it is worth reviewing the specific wording included in sponsorship campaigns.

5. Firms, not the creator or issuer of an underlying crypto asset, should conduct thorough due diligence before promoting: Companies need to check whether claims of the crypto asset issuer promoted by them are credible. Some of the areas of concerns are environmental, social and governance (ESG) features, prospects of success, legal and beneficial ownership; and vulnerability to operational, technological and cyber risks.

To do this, firms must review the issuerâ€™s white paper and undertake background checks. They also need to be assure that the crypto assets are not linked to financial crimes, such as fraud, money laundering and scams. And the evidence of the due diligence must be retained.

6. Do not assume that stablecoins are stable: If firms canâ€™t evidence a claim then they should not make it, particularly if a so-called â€œstableâ€ coin is â€œalgorithmicâ€ or â€œcrypto-backedâ€. Equally, if they can evidence a claim then test that it is capable of being understood by the target market.

7. Ensure that a senior manager who does not work in compliance spearheads the firmâ€™s implementation project: This will increase the prospect of the project being delivered on time and counter any perceptions of compliance being a â€œone off, tick boxâ€ exercise.

8. Consumers will not receive protection from the Financial Ombudsman Service (FOS) or the Financial Services Compensation Scheme (FSCS): The entry into force of the financial promotion regime should not be received, or communicated to customers, as reducing the inherently high risk and largely unregulated nature of crypto asset trading.

9. Ensuring that the appropriateness tests are appropriate: If a firm intends to make a direct offer financial promotion to a consumer, it will need to perform a robust appropriateness assessment in advance. This is to ensure that the consumer has the necessary knowledge and experience to understand the risks involved in the specific investment or service to be promoted.

The FCA expects this assessment to be meaningful, i.e. that is not capable of being â€œgamedâ€. It means, binary yes/no answers should not be used in testing; there should be different questions for each assessment, selected at random; and a client should not be re-assessed for the same investment within 24 hours (if it is assessed as being inappropriate), encouraged or incentivised to retake the test or coached through the test (although they can be directed to educational materials).

10. If a firm is already registered with the FCA, it may be able to apply for additional flexibility to implement certain technical changes: The FCA recognises that certain elements of the extended financial promotions regime are likely to require firms to undertake significant technical developments. These include the introduction of the 24-hour cooling off period. Therefore, the FCA has recently stated that an extended implementation period (until 8th January 2024) might be available to enable firms that are already authorised or registered with the FCA to make the necessary changes to their systems. Any relief would be: (a) available only to those that apply for, and are granted it, and which are (ii) limited in scope, with the core rules still taking effect on 8th October 2023.

If a firm could potentially benefit from the additional flexibility, it should give consideration to what to include in the application now. In particular, it is worth factoring in contingency plans if the firm fails to implement the technical changes required by 8th January 2024. Clear tasks, milestones, owners and arrangements for progress reporting should also be detailed.

New @hmtreasury and FCA papers set out new rules for the #marketing of #cryptoassets relating to the financial promotion regime. @CMS_law's article is a good overview of the changing guidance and how new #regulation will impact UK firms https://t.co/pTsM701NeO
â€” Greengage (@GreengageCo) January 26, 2022

Crypto Firms Need to Comply with Regulations

This article has provided a whistlestop tour of factors firms will need to consider when the UKâ€™s financial promotions regime is extended to cover crypto assets. In view of the FCAâ€™s feedback on firmsâ€™ preparations to comply (7th September 2023), there is much to do and little time available in which to do it. The links to other regulatory initiatives such as the Consumer Duty, financial promotions gateway and new social media guidance should also not be underestimated.

To summarise, the key to decrypting this complex web of regulatory expectations is careful planning reinforced by a clear vision as to what is realistically possible in finite time.

This article was written by Lewis Gurry at www.financemagnates.com.

Source : Finance Magnates

2 days ago

Crypto.com Partners with PayPal and Paxos: Preferred for PYUSD Trading

Crypto.com, a Singapore-based cryptocurrency exchange, has joined forces with payment giant PayPal and blockchain infrastructure firm Paxos to establish itself as the preferred platform for trading in PayPal's USD-pegged stablecoin (PYUSD).

PYUSD Listing: Access for Both Retail and Institutional Users

This collaboration underscores Crypto.com's commitment to providing comprehensive cryptocurrency services to its users. According to a press release issued on September 28, Crypto.com currently boasts the most extensive liquidity for PYUSD trading pairs on a global scale.

The exchange has promptly listed PYUSD for both retail and institutional users. It is anticipated that it will provide additional "trading features" in the near future. This development represents an expansion of the existing partnership between PayPal and Crypto.com, which previously included the option to use PayPal for topping up the Crypto.com Visa Card.

Joe Anzures, the Senior Vice President of Americas and Global Head of Payment Partnerships at Crypto.com, expressed enthusiasm for the collaboration with Paxos, referring to them as "a market-leading issuer of stablecoins."

He emphasized the significance of this partnership in extending crypto accessibility to Crypto.com's more than 80 million users while supporting PayPal's global network of consumers and merchants. Anzures added: "Connecting our more than 80 million users to the latest crypto innovations will be pivotal in our continued pursuit of crypto for every wallet."

PayPal, Paxos, and https://t.co/vCNztATkNg are taking crypto to new heights.ðŸ¤Together, we're shaping the future of finance, with PYUSD integration and enhanced top-up options, including the https://t.co/vCNztATkNg Visa Card. pic.twitter.com/id2KhUqsQj
â€” Crypto.com (@cryptocom) September 28, 2023

The Convergence of Traditional Finance and Cryptocurrency

PayPal entered the stablecoin arena in August 2023 with the launch of PYUSD. This stablecoin is built on the Ethereum blockchain. It is fully backed by U.S. dollar deposits, short-term Treasurys, and similar cash equivalents, ensuring stability and trustworthiness.

PYUSD has already gained a presence on major cryptocurrency exchanges, including Bitstamp, Coinbase, and Kraken. It also serves as a payment option for platforms like BitPay and Metamask. PYUSD became accessible to Venmo users in September.

The New York State Department of Financial Services has also recognized the stability and reliability of PYUSD by including it on its "green list" of approved cryptocurrencies.

The collaboration between Crypto.com, PayPal, and Paxos highlights the growing integration of traditional finance and the cryptocurrency ecosystem. stablecoins gain traction and accessibility. This partnership is set to further accelerate the adoption of digital assets within the global financial landscape.

This article was written by Tareq Sikder at www.financemagnates.com.

Source : Finance Magnates

2 days ago

SEC under Fire: Congress Considers Subpoena for FTX Documents

The tension between the US House Financial Services Committee and the Securities and Exchange Commission (SEC) escalated today (Wednesday) after the Chair of the committee, Representative Patrick McHenry, suggested that he may use a subpoena against the commission to acquire critical documents about the former CEO of FTX, Sam Bankman-Fried.

SEC Accused of "Lack of Responsiveness"

McHenry accused the Chairman, Gary Gensler of attempting to stifle the digital asset ecosystem while failing to maintain transparency in the SEC's dealings with Congress. This clash dates back to February when the committee, under McHenry's leadership, initially requested documents related to communications between the SEC's staff and the Justice Department concerning the charges against Bankman-Fried.

McHenry said: "Your lack of responsiveness to this committee's legitimate oversight continues to be unacceptable. In February, this committee made multiple requests for documents to the SEC. Yet, seven months later, the committee has not received a single non-public document that was not part of a FOIA production."

The committee had previously made multiple requests for documents, particularly concerning the timing of SBF's arrest, considering his scheduled appearance before Congress. However, these requests have yielded no non-public documents besides those obtained through the Freedom of Information Act (FOIA).

McHenry renewed these requests in April and May, dissatisfied with the SEC's provision of only publicly available information. Thus, McHenry conveyed his impatience, emphasizing that the SEC is not above the law and should be responsive to congressional oversight like other financial regulators.

He added that he did not wish to be the first Chairman of the Financial Services committee to issue a subpoena to the SEC, urging Gensler to consider the long-lasting consequences of his actions on the agency's reputation.

Gensler Defends SEC

In response, Gensler defended the SEC's regulatory actions, saying the agency's responsibility is to protect investors and ensure transparent disclosure. He emphasized the importance of compliance to safeguard the users of crypto platforms and investors, calling for proper protection of customer funds and separating conflicting lines of business.

Last year, the SEC formally charged Bankman-Fried, the CEO and Co-Founder of FTX, with orchestrating a scheme to defraud investors. Bankman-Fried, once celebrated for his role in the crypto world, is facing allegations of concealing the diversion of FTX customers' funds through his crypto hedge fund, Alameda Research.

But, McHenry has pointed out that the SEC's current approach to rulemaking potentially threatens the integrity of financial markets and poses risks to investors. McHenry stressed the need for a comprehensive economic analysis of the proposed rules and their combined impact, accusing the commission of failing to carry out such assessments adequately.

Additionally, McHenry criticized the SEC for not prioritizing capital formation, noting a glaring absence of initiatives aimed at improving access to capital or enhancing market competitiveness within the agency's rulemaking agenda.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

1 days ago

Gemini to Cease Operations in Netherlands: Regulatory Hurdles Force Move

The New York-based cryptocurrency exchange Gemini has announced its decision to suspend services to Dutch customers starting from November 17. This move is as a result of regulatory pressures imposed by the De Nederlandsche Bank (DNB).

However, Gemini is not exiting the Dutch market for good; the exchange aims to re-enter the country once it achieves full compliance with the new crypto asset rules outlined in the European Union's Markets in Crypto-Assets Regulation (MiCA).

In a letter addressed to its Dutch users on September 26, Gemini communicated the impending suspension of its operations. The letter urged customers to either withdraw their assets or transfer them to another wallet address to comply with the DNB's directives. Gemini emphasized the necessity of emptying users' accounts by November 17, 2023.

Gemini Recommends Rival Bitvavo

In light of this, Gemini has suggested that its users consider Bitvavo, a local cryptocurrency exchange that is duly registered with the DNB, as an alternative for their crypto holdings. Bitvavo is an an Amsterdam-based exchange that was established in 2018 and holds membership in the Dutch Association of Bitcoin Companies.

This development follows a trend seen earlier in 2023 when Binance ceased its Dutch operations due to regulatory hurdles from the DNB. At the time, DNB press officer Tobias Oudejans suggested that compliance with MiCA could pave the way for Binance's potential return to the Dutch market. Presently, the DNB has registered 37 virtual asset providers, including eToro, Coinbase, Crypto.com, and BitPay.

Gemini's Global Expansion

In May, Gemini relocated its European headquarters from London to Dublin. While initial reports hinted at London as the destination, regulatory uncertainties prompted Gemini to seek a safe haven in another jurisdiction within the British Isles.

Awesome meeting this morning with @LeoVaradkar, the Prime Minister of Ireland. We talked about the profound promise of crypto and the importance of common sense regulation to realize that promise. We believe MiCA is that common sense regulation. We also announced that @Gemini hasâ€¦ pic.twitter.com/Iv3NmPTmju
â€” Cameron Winklevoss (@cameron) May 25, 2023

Ireland's attractiveness as a hub for financial services and emerging technologies played a pivotal role in Gemini's decision, the exchange said. Its registration as a Virtual Asset Service Provider (VASP) in Ireland in July 2022 further strengthened its commitment to the region.

In addition, Gemini bolstered its international markets with the launch of the Gemini Foundation, a crypto derivatives platform, in April. This move also came as a response to growing regulatory pressures in the US. Gemini Foundation provides a range of crypto derivatives products, with its initial offerings revolving around Gemini dollars (GUSD), the exchange's proprietary stablecoin.

Elsewhere, Gemini filed for pre-registration with the Ontario Securities Commission (OSC) in Canada in April to ensure its continued operations and compliance with regulatory requirements in country. The pre-registration filing occured in response to the OSC's mandate requiring all crypto exchanges operating within its jurisdiction to register with the regulator.

This article was written by Jared Kirui at www.financemagnates.com.

Source : Finance Magnates

Added today

Singapore Authorities Arrest Co-founder of 3AC in Bankruptcy Case

Su Zhu, the Co-founder of Three Arrows Capital (3AC), has been arrested in Singapore. His arrest is linked to his alleged failure to cooperate during the bankruptcy proceedings of 3AC, the now-bankrupt crypto lending company.

Today (Friday) afternoon at Changi Airport in Singapore, Zhu was arrested. His attempt to leave the country led to his detention, a development confirmed by Teneo, the entity overseeing 3AC's liquidation.

3AC was known for its investments in projects like LUNA, Aave, Avalanche, BlockFi, Deribit, and Solana before its collapse last year. The downfall began when LUNA, a significant investment of 3AC, experienced a massive crash in May, triggering a series of events.

Breaking: ZHU Su, co-founder of failed crypto hedge fund Three Arrows Capital, was apprehended at Changi Airport whilst attempting to travel out of Singapore on Friday (Sep 29) afternoon. Businesstimes reported. https://t.co/W01HoeQYCu pic.twitter.com/TwvRuFKbxw
â€” Wu Blockchain (@WuBlockchain) September 29, 2023

Zhu Wanted for Eluding Authorities

Despite managing up to $18 billion in cryptocurrency assets at its peak, 3AC failed to meet margin calls in June, raising questions about its financial stability. In addition, the failure to repay a substantial debt of $665 million to crypto broker Voyager Digital exacerbated the situation, further destabilizing the company.

The Monetary Authority of Singapore (MAS) reprimanded 3AC and its founders in June 2022. This reprimand was due to alleged misinformation, failure to report ownership changes in the executive ranks, and exceeding allowable asset thresholds for a registered fund management company.

According to the MAS, the investigations uncovered that the company failed to notify regulators about the employment of its representatives and made false representations about them.

In June, a report by the New York Times indicated that Kyle Davies, the Co-founder of 3AC, and Zhu had embarked on a year-long journey that took them to Bali instead of facing the aftermath of the collapse of their hedge fund. They departed from Singapore, where Three Arrows was headquartered, and embarked on a journey across Asia, essentially taking a summer sabbatical.

3AC's Downfall and Regulatory Reprimand

Meanwhile, Singapore's financial market regulator barred the duo from participating in the city-state's financial services sector for nine years in September. The ban was effected on September 13 in response to several regulatory reporting lapses tied to the fund's operations.

Founded in 2012 and headquartered in Singapore, 3AC was once a prominent cryptocurrency hedge fund known for its highly leveraged positions. However, its fortunes took a sharp downturn, incurring losses exceeding $400 million amid the crypto market's slump in the previous year.

The consequences of 3AC's collapse extended far beyond its immediate stakeholders. Voyager Digital, unable to recover its debts from 3AC, was forced to file for bankruptcy. The domino effect resulted in damages exceeding $3 billion, affecting several companies in the crypto space.

A new CNBC report speculates on the impact of a potential BlackRock Bitcoin ETF suggesting it could become the most dominant following any SEC approval.

Latest News