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Wall Street’s largest banks are tapping into the crypto market through derivatives

Episode 51 of Season 4 of The Scoop was recorded remotely with The Block’s Frank Chaparro and James Stickland, CEO of Elwood Technologies. Listen below, and subscribe to The Scoop on Apple, Spotify, Google Podcasts, Stitcher or wherever you listen to podcasts. Email feedback and revision requests to [email protected] Elwood Technologies — an Alan Howard backed digital asset platform that is building trading infrastructure for institutional investors — closed a $70 million Series A last month co-led by Goldman Sachs and Dawn Capital. In this …

SEC court win over Terraform and Do Kwon opens door for UST investigation

Terraform Labs’ court loss over Mirror Protocol opens the doors for greater action on the collapse of stablecoin TerraUSD.  Yesterday, the Second Circuit Court rejected Terraform Labs’ appeal against the Securities and Exchange Commission, upholding an earlier decision from the Southern District of New York. The SEC served founder Do Kwon with a subpoena as he prepared to go onstage to speak at Messari’s MainNet event in Manhattan back in November.  In the attempted appeal, Kwon’s lawyers argued that the …

Terraform Labs ordered to cooperate with SEC probe of Mirror Protocol

Terraform Labs and its CEO Do Kwon must comply with Securities and Exchange Commission (SEC) subpoenas related to the Mirror Protocol, according to a ruling on Wednesday from the US Court of Appeals for the Second Circuit.  The SEC is investigating whether Terraform and Kwon were involved in selling unregistered securities through the Mirror Protocol, which lets users trade crypto tokens that represent popular stocks like Apple and Amazon. The regulator served Kwon with papers at Messari’s crypto conference, Mainnet, …

CFTC chair eyes disclosures to curb energy consumption in Bitcoin mining

Commodity Futures Trading Commission chair Rostin Benham is looking to research and incentives to address energy usage in bitcoin mining.  During the Washington Post’s “Evolution of Money” event, Benham responded to concerns about bitcoin being “extremely energy-intensive” by pointing to research provisions in the newly introduced legislation from US Senators Cynthia Lummis and Kirsten Gillibrand. The legislation calls on the Federal Energy Regulatory Commission to create a report on energy consumption in the digital asset industry.  Benham said it’s not …

SEC’s Gensler floats routing equity trades to auctions to increase competition

Securities and Exchange Commission Chair Gary Gensler is considering new requirements to increase order-by-order competition. In remarks delivered at the Piper Sandler Global Exchange Conference today Gensler said he’s directed his staff to make recommendations around how to enhance order-by-order competition and mitigate conflicts that can arise when platforms use PFOF practices or rebates. That includes a potential auction practice unless investors are getting midpoint or better prices. “The listed options exchanges have operated auctions for retail orders for many …

NY DFS issues new guidance on dollar-backed stablecoins

The New York Department of Financial Services (DFS) today became the first financial regulator in the US to issue guidance outlining compliance requirements for dollar-backed stablecoins. The guidance builds on informal policies used by the DFS since 2018, setting “baseline requirements” for any stablecoin issuer currently subject to DFS oversight, and any firm that applies to be regulated in the future. It “creates clear criteria for virtual currency companies looking to issue USD-backed stablecoins in New York,” according to Adrienne …

Grayscale hires Obama’s former Supreme Court lawyer for legal push against SEC

Grayscale, a leading crypto asset manager, has retained a heavy hitter from the Obama-era Department of Justice. The new legal counsel, Donald B. Verrilli Jr., was the solicitor general under President Obama. The role is a Department of Justice appointment that represents the US government in cases before the Supreme Court. Verrilli is currently a partner at Munger, Tolles & Olson.  Jennifer Rosenthal, Grayscale’s VP of communications announced the hire in a June 7 Twitter thread, noting the firm’s “unwavering …

How authorities could pursue ‘insider trading’ in crypto

Quick Take Last week a grand jury indicted former OpenSea head of product Nate Chastain for actions related to an alleged insider trading scheme. But Chastain wasn’t indicted for securities law violations, which are usually associated with insider trading. If successful, the case could create a way for US regulators to police front-running in crypto regardless of whether implicated tokens are securities. This feature story is available to subscribers of The Block News Plus. You can continue reading this News …

Senators Gillibrand and Lummis release long-awaited cryptocurrency bill

IRA Financial Trust, a provider of crypto IRA services, said Monday that it is suing crypto exchange Gemini for its alleged role in the breach of customer retirement accounts. IRA Financial, which has offered clients exposure to crypto via integration with Gemini, said in a press release that the New York-based Gemini’s systems were responsible […]

SEC is investigating Binance’s BNB token: Bloomberg

The Securities and Exchange Commission (SEC) is reportedly investigating whether Binance’s BNB token was a security at the time of its sale in 2017. Bloomberg reported Monday that the SEC has launched a probe into the BNB token. The US securities regulator is taking a look at the early days of the exchange, examining whether the sale of its BNB token during a 2017 initial coin offering amounted to an unregistered sale of securities. SEC chair Gary Gensler has been …