Former CFTC Chair Says A Bitcoin ETF Would Be Good For Regulators; SkyBridge BTC ETF Delayed

Timothy Massad, former chairman of the US Commodity Futures Trading Commission (CFTC), has urged the U.S Securities and Exchange Commission (SEC) to approve a Bitcoin exchange-traded fund (ETF).

Massad made his points known in a Bloomberg opinion piece. He said the SEC should look into approving an ETF in a way that would enhance transparency and integrity in the industry.

Bitcoin ETF Would Be Good For Retail Investors

Massad said a Bitcoin ETF would help retail investors invest in digital assets without purchasing them and dealing with the complexities of custody.

He said that while it would be best to have crypto regulations in place before approving a Bitcoin ETF, this may not happen soon. This is why Massad thinks a conditional approval would be best to increase the industry’s transparency, integrity, and investor protection, not just its mass appeal. Massad said,

“Although it would be best to see such ETFs approved only after Congress has strengthened crypto regulation generally, the likelihood of that happening in the near future is low.”

While cryptocurrency exchanges are largely unregulated in the U.S, the former CFTC chair said the SEC could use the ETF listing process to improve the integrity of cryptocurrency exchanges in the absence of comprehensive regulations.

He added that the ETF approval could be granted on the condition that the ETF prices are based on an index of exchanges meeting certain prescribed standards.

Massad’s comments follow similar comments attributed to SEC Commissioner Hester Peirce, who argued that a Bitcoin ETF should have been approved a long time ago.

In an interview with CNBC, Peirce said that she sees the SEC using double standards in approving crypto products. According to her, the SEC applies a heightened standard in filings associated with cryptocurrencies, unlike the standards it uses for traditional, equity-based products.

SEC’s Continuous Delay In Approving ETFs

Over the years, there have been several applications for a Bitcoin ETF, but the SEC is yet to approve any of the applications.

The regulator had previously cited concerns like fraud, market manipulation, and volatility as the reasons behind the rejections or delays.

The latest application facing delay by the SEC is Anthony Scarammuci’s SkyBridge Capital’s application for a Bitcoin ETF. A filing by the regulator shows that the application submitted on May 6 has been extended for 45 days ending in August.

The SEC is currently reviewing many applications and has invited public comment on the Bitcoin ETF filed by asset manager VanEck. The review process has also been extended until August 2021.

Other firms currently witnessing delays from the regulator in approving ETFs include WisdomTree, Kryptoin, and Fidelity Investments.

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Author: Jimmy Aki

Gearing Up For An IPO: BlockFi Adds Former CFTC Chairman ‘Crypto Dad’ to Board

Gearing Up For An IPO: BlockFi Adds Former CFTC Chairman ‘Crypto Dad’ to Board

Former Commodity Futures Trading Commission (CFTC) chairman J. Christopher Giancarlo has joined the board of directors of crypto neobank BlockFi.

“Just another step towards BlockFi’s mission of bringing financial products to crypto investors around the world,” tweeted Anthony Pompliano, founder and partner at Morgan Creek Digital.

Giancarlo headed CFTC in 2017 when Bitcoin futures made its debut on CME Group and Chicago Board Options Exchange (CBOE). He left office in 2019.

In early 2018, during his congressional testimony in which he advocated for a “do no harm” regulatory stance towards crypto assets, it earned him the title “Crypto Dad.”

Giancarlo is the first independent, non-equity holding director on BlockFi’s five-person board.

“As the adoption of digital assets accelerates, it is critical for the financial industry to consider how to adapt and integrate these innovations in a way that best serves investors and the broader economy,” Giancarlo said in a statement on Tuesday.

Crypto lender, BlockFi allows users to earn interest on their crypto assets and also offers Bitcoin Trust and is looking for Giancarlo’s guidance on regulatory developments and other initiatives.

The crypto unicorn managed over $15 billion in assets and reported just shy of $100 million revenue in 2020. Running toward generating $500 million in revenue this year, the company has grown its client base from 10k to 250k since 2019-end.

Founded in 2017 by Zac Prince and Flori Marquez, BlockFi is rumored to be planning for an initial public offering (IPO) in the second half of 2021, which was valued at $3 billion in its latest private funding round. Coinbase, the largest crypto exchange in the US, made its debut on Nasdaq at a valuation that briefly went to $100 billion.

“There are plenty of reasons a company like BlockFi might want a former high-ranking gov’t official like Chris Giancarlo on its board, & I’d guess one of them is preparation for an IPO. Great move,” tweeted Jake Chervinsky, General Counsel at Compound Finance.

Besides a move suggesting BlockFi gearing up for going public, this addition also underscores the ongoing demand for regulatory experiences in the crypto industry. Just yesterday, Binance.US tapped former acting OCC chief Brian Brooks as its new CEO.

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Author: AnTy

Fed Reserve Chair Jerome Powell Calls BTC A ‘Speculative Asset’ Amid Coinbase Direct Listing

Federal Reserve Chairman Jerome Powell Calls BTC A ‘Speculative Asset’ Amid Coinbase Direct Listing

Cryptocurrencies have been around for more than a decade and have just gained global relevance in the last two years.

This has been largely due to institutional investors seeing digital assets like Bitcoin as a hedge against inflation. However, the US Federal Reserve boss believes that crypto-assets are still not ripe for payments.

Crypto Is Just For Speculation

In a virtual interview organized by the Economic Club of New York, Powell said that cryptocurrencies are ideal as vehicles for price speculation. According to him, they have not attained the status of becoming a payment option.

Powell also said that cryptocurrencies like Bitcoin could be rightly compared to precious metals like gold, given the difficulty of mining them. And since humanity has always placed gold on a high pedestal, he feels that Bitcoin can transform into the same mold.

Powell’s comments may seem contradictory to crypto owners who believe that Bitcoin was created for payment services. The jury is still out on whether Bitcoin would function as a medium of exchange effectively. This is due to the development of solutions like sidechains and Lightning Network.

Companies like Tesla now accept Bitcoin as payment for their sedans, and many more businesses would tow the same line soon. The adoption rate in the traditional markets has also been growing.

Just yesterday, the U.S-based bitcoin exchange Coinbase made its debut on Nasdaq as a publicly-traded company.

The milestone, which is a first for the crypto industry, is poised to attract more investments into the space.

Coinbase opened its shares to the investing public at a whopping $381 per share against the $250 reference price.

The company also made its Q1 report for 2021 public, noting that it generated over $1.8 billion in revenue and onboarded 56 million unique users since its founding.

BTC Better Store Of Value Than Gold

Powell’s views on cryptocurrencies are not entirely novel to the crypto universe. Last month, U.S Treasury Secretary Janet Yellen called Bitcoin a highly speculative asset and not fit to be used as a value transmission mechanism.

According to the well-known Bitcoin critic, value transmission through cryptocurrencies is an extremely inefficient way of conducting transactions. Her comments have not slowed down investments in the sector. Software company MicroStrategy owns Bitcoin worth billions of US dollars. The company’s CEO Michael Saylor sees Bitcoin as a better store of value than gold and other precious metals.

Recently, the company announced that non-employee board members will now be paid using Bitcoin.

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Author: Jimmy Aki

MIT Blockchain & Crypto Course Prof, Gary Gensler, Confirmed as the SEC Chairman by US Senate

MIT Blockchain & Crypto Course Prof, Gary Gensler, Confirmed as the SEC Chairman by US Senate

Gary Gensler has been finally confirmed as chairman of the Securities and Exchange Commission (SEC) after a 53-45 vote by the Senate on Wednesday, the day the crypto and traditional markets are all eagerly awaited the Coinbase listing on Nasdaq.

Gensler, chosen for the nation’s top financial regulator by US President Joe Biden, began his career as a banker at Goldman Sachs. He previously also served as chairman of the Commodity Futures Exchange Commission (CFTC) and implemented new rules around derivatives in the aftermath of the 2008 financial crisis.

As SEC Chair, not only Gensler will play a key role in enforcing and drafting rules that govern Wall Street but will also be shaping the regulations addressing the crypto industry.

The crypto market has high hopes from Gensler, even SEC Commissioner Hester Peirce said in a public statement that with the new chair, this

“is the perfect time for the Commission to consider afresh how our rules can be modified to accommodate this new technology in a responsible manner.”

Gensler, who has taught about blockchain and cryptocurrency at MIT, said last month during his confirmation hearing that he will work on promoting both innovation and investor protection in the sector. At the time he had said,

“Bitcoin and other cryptocurrencies have brought new thinking to payments and financial inclusion, but they’ve also raised new issues of investor protection that we still need to attend to.”

The crypto market is also expecting good news regarding a Bitcoin ETF approval under his chairmanship.

“I think digital assets will be his legacy,” Michelle Bond, a former senior counsel at the SEC who is now CEO of the Association for Digital Asset Markets told CNBC.

“This is a global phenomenon. He is going to focus on registration of exchanges, regulation, retail protection, and he will be looking to root out fraud and manipulation.”

“This is a man who created a regulatory framework for swaps, and he has all the expertise to create a firmer regulatory framework for digital assets.”

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Author: AnTy

Former CFTC Chairman, Giancarlo & Billionaire Lasry Invest in Crypto Asset Manager, BlockTower

Former CFTC Chairman, Giancarlo & Billionaire Lasry Invest in Crypto Asset Manager, BlockTower

  • Milwaukee Bucks billionaire co-owner, Marc Lasry, and former CFTC Chairman, Christopher Giancarlo, invest in BlockTower, a crypto investments firm.

Bitcoin-enthusiast and billionaire, Gary Lasry and Christopher Giancarlo, the former Commodities and Futures Trading Commission (CFTC) chairman, are reportedly making an undisclosed investment in cryptocurrency and blockchain investment firm, BlockTower.

According to a report from Bloomberg, Lasry, the CEO of Avenue Capital Group, made an independent into the crypto firm, persons familiar with the matter reported. The Milwaukee Bucks co-owner declined to comment on the reports.

Known as ‘crypto dad’ across crypto circles, Giancarlo made huge progress in regulating the U.S. crypto field during his time as the chairman of the CFTC. The former CFTC boss has been vocal on developing the Bitcoin and crypto ecosystem – recently calling for the launch of a digital dollar.

Giancarlo confirmed the investment but declined to comment further or disclose the amount invested in Block Tower.

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Author: Lujan Odera

US Fed Chairman Jerome Powell Hinges Digital Dollar’s Fate on Lawmakers

US Fed Chairman Jerome Powell Hinges Digital Dollar’s Fate on Lawmakers

Jerome Powell, the U.S. Federal Reserve Chairman, has hinted that the Fed is eyeing a digital dollar, an initiative that will see the apex bank control digital assets.

According to the Federal Reserve chief, in the course of the year (2021), members of the public and lawmakers will likely debate the project.

Nationwide Consultations Needed

During a House Financial Services Committee hearing, which held on Wednesday, February 24, 2021, Powell admitted that there are many concerns surrounding the digital dollar project, hence the forum for lawmakers to engage with the public for common ground.

“This is going to be the year in which we engage with the public pretty actively, including some public events that we’re working on. In the meantime, we’re working on the technical challenges and also collaborating and sharing work with the other central banks around the world that are doing this.”

In the meantime, Powell revealed that the central bank is advancing on solutions to the technical challenges it has so far identified regarding the digital dollar, adding that it is also in talks with other central banks that are exploring or issuing the Central Bank Digital Currencies (CBDC).

Addressing why the Federal Reserve needs consultations from lawmakers before kickstarting the digital dollar, Powell explained that the health of other markets is essential to the US government, especially as it relates to creating a digital dollar.

“We could well need legislative authorization for such a thing. It isn’t clear until we see which way we’re going.”

Why the US Reserve is Eyeing CBDCs

It would be recalled that last year, while Powell was addressing his fellow panelists during a cross-border payments program that was hosted by the International Monetary Fund (IMF), he explained that the digital dollar would improve the payment system of the country by modernizing payment infrastructures.

Powell also mentioned that the digital dollar would be helpful in bridging the gap between the banked and unbanked, as it will reach consumers who are traditionally underserved by financial institutions. When asked why the Federal Reserve was yet to decide if the digital dollar was the way to go, Powell responded that,

“There’s a great deal of work yet to be done as well as extensive public consultation to be had with all stakeholders before making such a decision.”

In spite of the fact that many central banks across the globe have already adopted the digital dollar policy, Powell maintained that the Federal Reserve is not in contention on who’s first to do it.

“I think it’s more important for the United States to get it right than it is to be first. Getting it right means that we not only look at the potential benefits of a CBDC but also the potential risks and also recognize the important trade-offs that have to be thought through carefully.”

Digital Dollar Fuss

For the Federal Reserve and other apex banks, the primary objective for the consideration of the digital dollar is the need to limit the risks associated with cashless payments.

Should the digital dollar be institutionalized, the Federal Reserve will have a stronger and authoritative presence in the digital payments environment, which is expected to reduce the risk of fully relying on private payment systems for individuals.

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Author: Jimmy Aki

Fed Is Investing ‘Time and Labor’ As A Digital Dollar is ‘High Priority’ says Chairman Powell

Fed Is Investing ‘Time and Labor’ As A Digital Dollar is ‘High Priority’ says Chairman Powell

The Federal Reserve is also “committed” to solving the tech problems. Treasury Secretary, unlike her predecessor, also says it “makes sense for central banks to be looking at.”

Federal Reserve Chairman Jerome Powell told Congress on Tuesday that a digital dollar is a “high priority project for us.”

While the central bank is “looking carefully” at the prospect of issuing a digital currency, Powell said there are “significant technical and policy questions” related to it. Powell said,

“We are committed to solving the technology problems and consulting very broadly with the public and very transparently with all interested constituencies as to whether we should do this.”

Much like always, the Chairman said that as the world’s reserve currency, the US doesn’t have to be the first, but the point is in getting it right.

“This is something we’re investing time and labor in, across the Federal Reserve System.”

Just this week, Treasury Secretary Janet Yellen also said that the Biden administration supports research into the viability of a sovereign digital currency, unlike her predecessor Steven Mnuchin who didn’t see any need for that at the point.

“It makes sense for central banks to be looking at” issuing a digital dollar, Yellen said at a virtual conference on Monday hosted by the New York Times.

According to her, the digital version of fiat currency can help with the financial inclusion of lower-income groups.

“Too many Americans don’t have access to easy payments systems and banking accounts, and I think this is something that a digital dollar, a central bank digital currency, could help with.”

“It could result in faster, safer, and cheaper payments, which I think are important goals.”

Janet Yellen Treasury Secretary

While positive about a digital dollar, Yellen echoed Powell’s views about needing to address the issues first.

“There’s a lot to consider here, but it’s absolutely worth looking at,” she said.

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Author: AnTy

Michael Saylor to Forbes Chair: “Bitcoin is Not a Currency,” Not an Alternative to the Dollar

“Bitcoin is Not a Currency,” says Michael Saylor to Forbes Chairman; Declaring BTC Not an Alternative to the Dollar

Besides being “steak one day, dog food the next, and caviar the day after,” Steve Forbes says Bitcoin’s limited supply makes it not fit to be money.

“With all due respect, Bitcoin is not a currency,” said Michael Saylor, chief executive officer of MicroStrategy, a public company that owns 71,079 BTC.

Saylor’s comment on Bitcoin not being a currency came after Steve Forbes, Chairman & Editor-In-Chief at Forbes Media, wrote an article about Bitcoin not being money.

In his article, titled “Bitcoin is Not money — Yet” on Forbes, Steve talked about the leading digital currency, which has surged more than 1,000% since its March lows, becoming the “new darling” of investors.

Although bitcoin proponents are predicting BTC to “resume its rise and head to $100,000 or higher,” Steve wrote, “that doesn’t make Bitcoin an alternative to the dollar yet.”

Steve goes on to point out that people are rushing in Bitcoin due to “a lack of faith in government currencies,” with the central banks crushing the interest rates and “printing unimaginable amounts of money,” but still “whatever Bitcoin is, it’s not money.”

“Money works best when it has a stable value,” he wrote.

Although the dollar would argue with that, given that it has lost more than 90% of its value since it got unpegged from gold. As Senator Cynthia Lummis said, “The dollar is designed to be worth less every year.”

Meanwhile, Steve said with Bitcoin; the problem is “it’s steak one day, dog food the next, and caviar the day after.” Moreover, its fixed supply is another issue as “the supply of money must be able to expand in order to meet the needs of a growing economy.”

“Although the price of Bitcoin continues to skyrocket, that doesn’t make it an alternative to the dollar yet,” wrote Steve. In agreement with Steve, Saylor responded that Bitcoin is actually “not replacing the dollar” because it is not money rather “a monetary asset rapidly replacing Gold as a store of value.”

Leading spot crypto exchange Binance chief executive Changpeng Zhao (CZ) is also in agreement as he said the point is not the replacement because Bitcoin is a new thing and it “doesn’t care about the old.” According to Saylor, Bitcoin will “coexist with fiat currencies as it attracts capital from weaker safe haven assets.” And he isn’t worried about the flagship cryptocurrency at all as he believes, “The Bitcoin Standard will outlast all of us.”

With this in mind, his company continues to acquire Bitcoin, which was also the first publicly listed company to replace cash with BTC in its balance sheet as a reserve asset. According to Saylor, it is “a 10-year investment,” a time period during which Bitcoin has been “just going up,” he said on Binance Blockchain Week today.

MicroStrategy is also conducting a seminar for other corporations to help make the same transition. Already, more than 1400 firms are joining the discussion about integrating Bitcoin into corporate strategy.

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Author: AnTy

SEC Chairman: Bitcoin Will Be Subject To ‘More Regulation’ As It Matures Into A Payment System

SEC Chairman Jay Clayton reiterated in his recent interview with CNBC that Bitcoin is not a security. However, more regulation could still be on the way from other government agencies, he added.

According to him, the leading digital asset resembles a store of value and a payment method. And it has been the “inefficiencies” in the traditional payment mechanisms that are boosting Bitcoin’s growth.

But if BTC becomes famous as a payment method, it can be subject to more regulation. Clayton told CNBC,

“I think we will see this maturation, and I think there will be more regulation in the payments (for bitcoin) area.”

“This is why Bitcoin should be neither a currency nor a payment network. The principles of humility & harmony dictate that we should allow technology partners to provide for payments & defer to governments on currency matters. BTC is a purely engineered Store of Value,” commented the CEO of MicroStrategy, Michael Saylor, who has emerged as a leading vocal Bitcoin proponent ever since his company replaced cash with BTC as a reserve asset.

Clayton will be stepping down from his position as the SEC Chairman by the end of this year, and the crypto community is excited, expecting the Bitcoin ETF to get the approval finally.

According to analyst Mati Greenspan, Clayton has been “single-handedly” responsible for holding back the progress of a Bitcoin ETF, and “him leaving is really good for Bitcoin & crypto.”

In his interview with CNBC on Thursday, Clayton further elaborated on why the SEC isn’t regulating Bitcoins currently.

“We do not regulate Bitcoin as a security. When people use crypto assets as securities to raise capital for a venture, the SEC regulates that.

And what was happening in the ICO craze was people were using ICOs and essentially making public offerings of securities without registering them with the SEC.”

Very clearly, Clayton has said that the SEC determined “Bitcoin was not a security” but “much more a payment mechanism and store of value,” adding “the government does regulate payments.”

Clayton has been in conversation with Squawk Box host Andrew Ross Sorkin who recently hosted Jamie Dimon, the CEO of JPMorgan, who still has no love lost for Bitcoin.

Dimon said Bitcoin is “not (his) cup of tea,” and if it continues to get bigger and bigger, it will be “regulated.” “My experience with the government is they can regulate whatever they want whenever they feel like it,” coped Dimon.

This may sound like Ray Dalio, who is also concerned about the government outlawing it. Still, the founder of the world’s largest hedge fund Bridgewater Associates recently came out and said that he might be missing something about Bitcoin and “would love to be corrected.”

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Author: AnTy

SEC Chairman Jay Clayton to Step Down By Years End; Will Crypto Regulations Ease?

Jay Clayton is set to step down as the U.S. Securities and Exchange Commission (SEC) chairman by the end of this year.

Clayton, who has been at the agency’s helm since May 2017, stated he would be departing six months from his scheduled exit. He was expected to step down in June next year.

Appointed by President Donald Trump and sworn in as chair in May 2017. His early departure could have accelerated by the apparent election of Joe Biden as the next president, it still remains to be seen who might replace him. Stating,

“I would like to thank President Trump for the opportunity, and the support and freedom, to lead the women and men of the SEC.”

The chair also thanked Secretary Mnuchin as well as the entire treasury for their support and assistance. He also praised other agencies in the treasury department for their close working relations.

According to a statement from the SEC, Through Clayton’s leadership, the SEC improved the capacity of businesses of different sizes to raise capital and strengthen the enforcement of programs. The report said:

“The Commission obtained orders for over $14 billion in monetary remedies, including a record $4.68 billion in fiscal year 2020, and returned approximately $3.5 billion to harmed investors.”

“In addition, during Chairman Clayton’s tenure, the Commission paid approximately $565 million to whistleblowers, including the largest single award in the program’s history ($114 million).”

The SEC also stated that Clayton was steadfast in the enforcement of different policies and regulations within the crypto space. His tenure coincides with the recent largest Bitcoin’s bull run and the 2017 ICO’s wave.

Clayton was a controversial figure in the crypto space for his hard stance that almost all the ICOs were offering unregistered securities. Notably, however, Clayton opined that Bitcoin was not a security as well as Ethereum too. Later, the SEC reaffirmed this opinion.

In his tenure, Clayton has seen the SEC institute fines on numerous crypto projects which ran ICOs. Over the last year alone, the SEC collected about $1.26 billion as fines from different crypto projects. His departure is seen as a welcome move from the crypto and blockchain community.

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Author: Joseph Kibe