The Endless Crypto Legal Battles Continue

Plus PayPal crypto ditches the UK

Author

Nathaniel Whittemore
August 17, 2023

The Breakdown First Five - Tuesday, August 14 2023

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. Better Markets Objects to ETF

Financial markets lobbyist Better Markets have objected to the Fidelity spot Bitcoin ETF being approved by the SEC. They claim that the product would expose investors to “fraud, manipulation and other investor harms”. Their objection letter appeared outdated and repeated well worn talking points from crypto critics. Better Markets have been endorsed by Gensler, Sherrod Brown and Elizabeth Warren. Is the anti-crypto army going to war?

4. Paypal Halts Crypto Service in UK

Paypal has suspended crypto services in the UK with a view to restarting early next year. The pause was made in response to tightened FCA regulations around crypto advertising and dealing with mass market investors. Customer balances will be maintained but the ability to purchase crypto will be shut down from October 1.

3. Dog Gone Bridge is Out

The launch of meme layer 2 network Shibarium is off to a rocky start with the official bridge experiencing delays. $1.7M in ETH was trapped in the bridge as discord moderators shut down comments for the Shiba Inu based network. Shibarium was an attempt to provide legitimacy to Shiba Inu and move it away from dogcoin joke status. While the network promised low fees and fast transactions, all that’s been supplied so far is frustration. SHIB is down 9% on the news.

2. Coinbase Approved for Futures

Coinbase has secured a license to offer futures products in the US. They will now be able to compete with the CME and recently licensed CBOE with their own Bitcoin and Ethereum futures offerings. Some anticipate that the availability of futures and spot crypto on the same platform will help reduce the spread between markets by simplifying arbitrage. The move could also ensure that the deepest and most liquid crypto derivatives markets aren’t formed offshore.

1. Ripple Opposes Appeal

Ripple has opposed the SEC’s interlocutory appeal of last month’s summary judgment. The brief claimed there is “no extraordinary circumstance here” and the lawsuit should proceed to completion before appeals. The SEC is seeking to appeal just the two issues it lost on, that programmatic sales and in kind distributions of XRP are not securities transactions. The SEC has no right to appeal, so will need to be granted permission by the courts.

Thanks for reading -NLW