Canada Kicks Off Global Rate Cuts

The Breakdown First Five - Thursday, June 6, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Cramer Coin Needs Disclosures

Gary Gensler faced a host of questions on CNBC’s squawk box covering the many moving parts at the SEC. For crypto, he said that the ETH ETFs launch would “take some time”, hinting that he isn’t satisfied with the state of disclosures. Jim Cramer peppered him with questions about what would be the next Crypto ETF, perhaps Bonk? Gensler responded that disclosures are inadequate across the board, including with Cramer’s own memecoin. 

4. DMM Bitcoin Finds the Money

Japanese exchange DMM Bitcoin says they will raise capital to backfill a $305M hack. The firm had previously said it would fill the hole “with support from our group companies.” DMM Bitcoin has already taken out a loan for $32M and is apparently now tapping capital markets for the remainder. They said they would be procuring Bitcoin equivalent to the loss in order to repay customers, but would be “taking care not to impact the market.” 

3. Stand With Crypto Hits 1M

Political action committee Stand with Crypto has reached one million members ahead of this year’s election season. The Coinbase backed initiative hopes to activate crypto voters and coordinate funding across a wide cross section of pro-crypto candidates. The news comes on the back of Coinbase announcing a further $25M in funding for sister SuperPAC Fairshake. The crypto lobby now has one of the largest warchests in Washington and a huge constituency. 

2. SEC Stays Losing

In another blow to the Gensler agenda, an appeals court has struck down SEC disclosure rules for private equity and hedge funds. The court found that the rules would be “overly burdensome” and ruled that the SEC has no congressional mandate that extends to private funds. The rule was intended to increase transparency for investors in this increasingly important segment of the finance industry. This loss is another stain on Gensler’s legacy at the agency. 

1. Canada Cuts

The Bank of Canada may have kicked off the global easing cycle, reducing their policy rate by 25bps to 4.75%. This morning the ECB also delivered a 25bps cut. Analysts expect the BoC to continue cutting at the remaining four meetings this year, bringing rates to 3.75%. So far the narrative is still ‘soft landing’ in the face of consistently sub 3% inflation. Can central banks stick the landing, or are rate cuts a sign that a global slowdown has arrived?