WEEKLY WRAP-UP October 11th, 2019
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This week saw some fairly active price action on BTC, but nothing out of the ordinary since nothing is out of the ordinary for price action on the leading cryptocurrency. Bitcoin value jumped up about 5% on the 4hr candle, then fell back down almost as much, almost as fast. Present ups and downs define the crypto space, but so does the long-term upward trend.
The UN finally got in on the crypto fun this week as UNICEF announced that they would be accepting and using ETH and BTF donations for distribution and funding their open source tech projects. This is a nice step forward for global adoption. You may not be surprised by the philanthropy known among crypto traders who attempted to send BTC to Amazon relief funds but were rejected by Bitpay.
The Bitfinex-Tether fiasco has reached a new point where although the appeal to reject NYAG attempts at further discovery was approved, a blind-side class-action lawsuit befell the two firms in response to their increasingly public escapades in New York courts. The suit alleges $1.4T in damages which of course they won’t end up paying, but 30% of that, which is a typical sum in such cases, is still a staggering amount.
ETH is not a security, it is a commodity, according to CFTC chairman. This is potentially big news, likely being deemed ‘big’ depending on how the SEC responds to it. Realistically the two commissions don’t interact usually, but this tug of war over jurisdiction in the crypto world is one for which the two keep recruiting more hands in order to gain the slack. The collars that the SEC gets from all the scam ICOs must be wild.
Then way off in South Korea, a legislator was eager to point out how Upbit and Kakao, the company behind Klaytn, may be up to some unseemly listing practices.
Class-Action Filed Against Bitfinex and Tether
We have to revisit this one. As expected, the story of the under-the-table bailout of Bitfinex by Tether is remaking headlines and gaining tremendous attention. Now a class-action lawsuit has been filed against the two alleging violations of the Commodities Exchange and RICO. These are serious charges that by appearances Tether and Bitfinex could realistically be found guilty of, but which the $1.4T in damages claimed is unlikely to be paid out in full. If they were found guilty, this would set a very unsettling precedent for other crypto companies operating offices in the USA that would be in very real and probable danger of being charged of market manipulation as well. There are still a lot of ICO bag holders.
A Korean Study in How to Throw Shade in Discourse
Just weeks after the Liberal Party of Korea announced that they would be shooting for legalization of ICO and IEO in the country to bolster the capabilities of startups to gain funding, Jintae Kim from the party announces that he has been doing his homework on exchanges in the country, including how Kakao operates in the crypto realm. It is no secret to the Korean legislature that Upbit has routinely found itself in serious legal hot water but has always managed to slip by unscathed. In fact, Kim brought up just that issue when filing his formal complaint to the appropriate board, and went as far as to say that Klaytn, LUNA, on Upbit and every other listing on every Korean exchange should be put under the FSS microscope. They probably won’t like what they find.
SEC Rejects Yet Another ETF Bid
The SEC continues to make it hard for crypto companies to make a buck in the USA. This time, the Securities and Exchange Commission from the good ol’ U S of A has rejected the Bitwise ETF on the grounds of market manipulation trappings. More specifically, the official statement states that Bitwise couldn’t prove that they would be able to prevent fraud and manipulation. This makes two ETF bids being rejected or withdrawn in as many months, the first being withdrawn by Van Eck and SolidX. With all the attempts and hard work going into the launch of an ETF in the states, one would think that whoever does crack that nut will be the pinnacle of excellence, and also become very, very wealthy.
CTFC Chairman Says Ether Is a Commodity, Not a Security
Well, it is (somewhat) official: Ether is a commodity. The CFTC chairman announced this week that he doesn’t believe it’s a security, as the SEC would love to push. His reasoning is that similar assets should be treated similarly. Therefore, if underlying asset that Ether is predicated on, digital assets, cannot be determined to be a security, then forks of the core asset cannot be considered securities either. There are some holes in that line of reasoning, first and foremost being the intent of use between different digital assets, and they do vary wildly. He went even further to even speak for Libra, which also hasn’t been deemed a security. He may be in the camp that reasons that if there is so much effort being put into trying to make digital assets seem like securities, then they likely aren’t. We’ll have to see if there is any response from the SEC on this one.
UNICEF to Start Accepting Crypto Donations
A triumph for adoption has arrived at the UN. Although there are worries that the UN can’t pay their bills, they are still churning out some progressive announcements in the way of UNICEF now making transactions with cryptos. They will be accepting, holding, and distributing donations of BTC and ETH, and will be using the cryptos to fund open source technologies projects as well. Cryptos could also help the UN as a whole make their payroll next month, but that’s for another newsletter.
