News
Weekly Blockchain Blog – June 2024 #4 | Baker Hostetler
Crypto firms announce licensing, acquisitions and new products
According to recent reports, a major Chicago-based digital asset trading desk recently obtained a BitLicense from the New York Department of Financial Services. The license allows the company to engage in virtual currency business in the state of New York.
Separately, in a recent blog post, US fintech and blockchain development company Ripple announced that it has completed the acquisition of a major digital asset custody provider. According to the blog post, the acquisition “adds a limited purpose trust company regulated by the New York Department of Financial Services [Ripple’s] licensing portfolio, which includes nearly 40 money transmitter licenses throughout the United States, as well as a major payment institution license issued by the Monetary Authority of Singapore and a Virtual Asset Service Provider (VASP) registration with the Central Bank of Singapore ‘Ireland”.
In another recent development, Tether announced “Tether’s official launch of Alloy, an innovative tied asset backed by Tether Gold.” According to a press release, Tether’s Alloy (aUSD₮) is a token “designed to track the value of one US dollar” and “is over-collateralized by Tether Gold (XAU₮), meaning it is backed by real physical gold filed in Switzerland.”
Finally, according to reports, one of the major banks in Latin America, Itaú Unibanco, recently expanded its bitcoin and ether trading services to all bank customers. Previously the bank would only offer the services to selected customers.
For further information please refer to the following links:
BIS releases survey results on CBDCs and cryptocurrencies
The Bank for International Settlements (BIS) recently released the results of its 2023 survey of central bank digital currencies (CBDCs) and cryptocurrencies. Key findings from the survey include the following:
- 94% of central banks surveyed are exploring a CBDC.
- The probability of central banks issuing a wholesale CBDC within the next six years exceeds the probability of them issuing a retail CBDC.
- The key features considered for wholesale CBDCs are interoperability and programmability.
- Key features being considered for retail CBDCs are holding limits, interoperability, offline options and zero remuneration.
- As for cryptocurrencies, to date, stablecoins are rarely used for payments outside of the crypto ecosystem.
- About two in three jurisdictions have or are working on a framework to regulate stablecoins and other cryptoassets.
For further information please refer to the following links:
Major Exchange Publishes Cryptocurrency Market Data in “Mid-Year Review”
A major US cryptocurrency exchange recently released its mid-year review, in which it presents “10 charts covering some key technical and fundamental trends in the cryptocurrency market.” Among the findings, the report analyzes “total value locked (TVL) growth normalized by native gas token price appreciation in top layer-1 (L1) and layer-2 (L2) networks.” The report also “insulates[s] the impacts of CME futures basis trades on ETF flows, showing that growth in unhedged exposure to BTC ETFs has slowed significantly since early April. Charts published in the report address the following: (1) native gas token price-adjusted TVL growth; (2) Activity Pulse: Total transaction fees versus active addresses; (3) Cost Breakdown for Ethereum Transaction Fees; (4) Level 2 locked value increased during 2024; (5) BTC active supply trended downward in Q2; (6) Correlation matrix (90-day window); (7) Average daily volumes for crypto majors by month; (8) Open interest of BTC futures (notional value); (9) Open interest of ETH futures (notional value); and (10) US spot bitcoin ETF market cap relative to CME bitcoin open interest.
For more information, please refer to the following link:
Justice Department Targets Dark Market; NY AG Announces Recovery of Cryptocurrency Deals
From Christopher Agnello
According to a recent press release issued by the United States Department of Justice (DOJ), two men have been accused of operating “Empire Market,” which allows users to “anonymously buy and sell more than $430 million in assets and illegal services around the world. “through a dark web marketplace. Empire Market allegedly facilitated approximately “four million transactions between sellers and buyers” between 2018 and 2020. According to the release, “[t]Thousands of sellers and buyers accessed Empire Market through specialized anonymization software to sell illicit goods and services. In connection with the investigation, law enforcement seized approximately $75 million in cryptocurrency.
According to another recent press release, New York Attorney General Letitia James has “recovered approximately $50 million” for more than 230,000 investors who invested in and were defrauded by a major US cryptocurrency platform by reaching a settlement. According to the statement, the cryptocurrency platform deceived investors with its Earn program and the settlement will provide “all defrauded investors with full recovery of assets who had invested in the Earn program but were unable to withdraw when the investment program collapsed.”
For further information please refer to the following links:
SEC Closes Ethereum 2.0 Investigation and Will Take No Action Against Consensys
From Christopher Agnello
According to a recent press release, the US Securities and Exchange Commission (SEC) has concluded its investigation into recently discussed Ethereum Here. On April 25, Consensys sued the SEC “to defend the Ethereum ecosystem by seeking a court order halting the SEC’s investigation,” arguing that the SEC lacked jurisdiction to continue investigating or regulating. According to the release, Consensys sent a letter on June 7 “asking the SEC to confirm that the May ETH ETF approvals, based on ether being a commodity,” would cause the investigation to be closed. According to the release, the SEC’s Enforcement Division notified Consensys that the division “will close its investigation into Ethereum 2.0 and will not take enforcement action against Consensys.”
For more information, please refer to the following link:
[View source.]