tl;dr
• Senators Lummis and Gillibrand take a holistic view of the crypto space with bill identifying most cryptos as commodities under the CFTC• Lummis says Fidelity's Bitcoin and Ethereum retirement offerings are a good thing, Gillibrand agrees• Rain Exchange, the Bahrain-based exchanged backed by Coinb...
• Senators Lummis and Gillibrand take a holistic view of the crypto space with bill identifying most cryptos as commodities under the CFTC
• Lummis says Fidelity's Bitcoin and Ethereum retirement offerings are a good thing, Gillibrand agrees
• Rain Exchange, the Bahrain-based exchanged backed by Coinbase, has laid off dozens of staff citing market downturn
• Elon continues to try and squirm out of his deal to buy Twitter
• US SEC is looking into the sale of BNB in the US as a security
• William Hinman emails are no longer classified as privileged information
Finally, a couple of lawmakers are taking a wider view of crypto regulation and have a plan. Here is what is on my mind today.
1. A new bill being introduced by Cynthia Lummis (R-Wy) and Kirsten Gillibrand (D-NY) is taking a holistic view of the crypto space and identifies most cryptos as commodities. This would move most altcoins under the jurisdiction of the CFTC leaving "ancillary assets" (a key term to be added to the Securities Exchange Act of 1934) under the jurisdiction of the SEC. According to the bill summary, ancillary assets are those which are not fully decentralized but also do not create rights to profits or other financial interests in a business entity. The top 200 altcoins according to CoinMarketCap would fall under this definition. This includes Bitcoin, Ethereum, Cardano, and Solana, to name a few. Still, those projects would have to file periodic disclosures with the SEC. As you may have guessed, this is in direct opposition to Gary Gensler's current view of the crypto space. There is a lot to unpack here in the 69-page bill that also addresses stablecoins. Simply, said stablecoins would have to have 100% reserve in qualified liquid assets. The bill is comprehensive. It may not be perfect, but it is, indeed, the best I have seen thus far and could lead to a boon in the crypto space.
2. As diversified asset allocation is good for retirement, according to Senators Lummis and Gillibrand, giving a direct nod to Fidelity's new retirement offering announced in May, that I reported on in my May 1 video. This perspective directly cuts across the views of Senators Tina Smith and Elizabeth Warren.
3. Rain Exchange, the Bahrain-based exchanged backed by Coinbase, has laid off dozens of staff citing market downturn. I call it another case of poor business management. Crunchbase has their headcount between 251-500. They just got a round of funding in January and now they're laying off dozens? How is that not poor business management? Overexuberance can lead to over-hiring which can lead to hard times during a downturn. This lesson has been exemplified many times over the years.
4. Elon continues to try and squirm out of the Twitter deal. If you were hanging your hat on that. He talks a lot of crap causes turmoil, capitalizes, then wriggles his way out of most of it. Not this time.
5. So, the US SEC is investigating the sale of BNB in the US as a security. In another hit against Binance, Reuters is reporting the exchange may have had about $2.35B worth of illegal transactions (e.g., money laundering). I think if you operate any kind of financial business, you are susceptible to fraud no matter how good your KYC is. If you look at any centralized exchange, you will be able to see how easy it is to create fraudulent accounts to run nefarious transactions through. None of it is easy, just ask any bank.
6. In a major move, the emails of William Hinman are no longer classified as privileged information and are open to the public. They are expected to be a hot topic in a conference call today. I the public conference call will solely focused on the emails. I am not sure what is in those emails yet, but if what I am hearing is true, the SEC does not come out of this looking good.