tl;dr
• CZ says cryptos could move to more algorithmic stablecoins backed by non-US Dollar assets• Sequoia and Paradigm face lawsuit accusing them of misrepresentation, false advertising and civil conspiracy• Germany's 3rd largest bank, Siemens, issues its first $64M digital bond on Polygon• Citadel follo...
• CZ says cryptos could move to more algorithmic stablecoins backed by non-US Dollar assets
• Sequoia and Paradigm face lawsuit accusing them of misrepresentation, false advertising and civil conspiracy
• Germany's 3rd largest bank, Siemens, issues its first $64M digital bond on Polygon
• Citadel follows BlackRock, investing $25M in crypto-friendly Silvergate
• US Senate Banking Committee begins its review of crypto regulation and wants it to be stricter; Sen Tommy Tuberville wants Bitcoin back as a 401K option
• South Korea defines security tokens and tells the industry he 1st onus is on them to self-regulate
• XRP may not be accessible in the US but Japan-based crypto lender FuelHash has added it to its list
The US regulators are pushing hard on crypto and the industry is looking for alternatives. Here is what is on my mind today.
1. The US is showing signs they may not stop at Kraken and BUSD. CZ says with this continued fight against the industry crypto may react and move to alternative assets. His thought is that stablecoins might move away from the current dollar-backed model to algorithmically pegged models backed by other assets. The United States may want to Rethink its approach to regulating crypto in light of some world powers looking to move away from the US Dollar.
2. So it looks like investors are going to bring a lawsuits against major VC players Sequoia and Paradigm over their involvement in the FTX debacle. In the lawsuit investors accuse the two firm of misrepresentation, false advertising and civil conspiracy. That last one hurts.
3. Since the SEC has taken action against Paxos over its issuance of BUSD, there has been an increased amount of FUD (fear, uncertainty, and doubt) spread about stablecoins. So much so that Circle has had to fend off rumors that it had received a Wells notice from the SEC. A Wells notice is a letter that the SEC sends notify the receiver that the SEC intends to recommend an enforcement action against them.
4. Siemens is Germany's third largest publicly traded company by market cap and they issued its first digital bond worth about $64M, on the Polygon blockchain. This is a very big deal as firms are looking to increase efficiency and decrease paperwork in the bond space. This is a big move that may prove to just be the beginning of rapidly increasing adoption of blockchain technology by traditional finance.
5. Continuing on that thread, Citadel, owned by Wall Street powerhouse, Ken Griffin, has recently invested $25M in Silvergate. This is following the increased investment from BlackRock in crypto-friendly Silvergate. As I reported on the first of this month, BlackRock increased its share of Silvergate to 7.2%.
6. The US Senate Banking Committee has begun its review of crypto regulation. As anticipated, the committee is looking to bring clarity to crypto regulation, but also wants to take a stricter approach to protect US customers. Here's hoping thy take a pragmatic approach and not be reactionary to influences that are not as educated in the space.
7. According to new guidance, the country will expect crypto firms to self-regulate and determine if a given token is a security. The country provided the industry clear definition of what a security is: security tokens are tokens that are digitized using distributed ledger technology. This aligns them with other countries in the region.
8. FuelHash, a Japan-based crypto lender, has added XRP to its list of cryptos, including stablecoins USDC and USDT, alongside BTC, ETH, ETC and BNB. I find this to be very telling and additional proof that crypto is international and not controlled by any single country. XRP may be hard to get in the United States, but, clearly, it can be had in other countries.