Gensler Dodges Tough Questions on CNBC

The Breakdown First Five - Wednesday, May 8, 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. Susquehanna Goes Big on Bitcoin

Investing giant Susquehanna has disclosed a $1B Bitcoin ETF position. This is by far the largest position disclosed so far, but is just a 0.2% portion of the fund’s $575B portfolio. Susquehanna chose GBTC for the bulk of their holdings, with a little bit of FBTC on the side. The firm also has sizeable positions in Microstrategy and BITO, the Bitcoin futures ETF. 

4. FTX Bankruptcy Plan

The FTX estate has filed their new bankruptcy plan which allows small creditors to receive 118% of their claim. The estate says that the 98% of creditors with claims under $50,000 will qualify for the enhanced distribution. Assets are still valued at November 2022 prices, so this can’t be viewed as a full recovery. Still this is a significant improvement from prior plans, recognizing that a payment above 100% is warranted. 

3. SEC Hearing

The House Financial Services Committee held a hearing on the appropriateness of SEC crypto enforcement strategy. Aside from a token witness for and against regulation by enforcement, the hearing largely acted as a delivery mechanism for well rehearsed sound bites. The only news was that a vote to rescind SAB 121 will happen this week and House Democrats are pushing for a 2-year ban on mixers. Lawmakers are digging into positions ahead of the election. 

2. Crypto Voters Could Swing Election

A new survey suggests that over 20% of voters consider crypto a key issue in November’s election. The survey only looked at swing states, finding that crypto policy could be enough to push candidates over the line. The major dark spot was Ohio, where 77% of respondents said they were negative on crypto, which could save Sherrod Brown’s bacon in a tight race. Still, a few percent of voters in battleground states could be enough to decide the next President.

1. Gensler’s Press Tour

It’s becoming a pattern that big SEC news is accompanied by Gary Gensler dropping in to discuss the big issues on Squawk Box. Or rather, avoid talking about the issues. Gensler refused to discuss his views on whether Ethereum is a security or the upcoming ETF deadline. In fact he avoided most of the questions to deliver his new theme, that crypto tokens need a better disclosure regime. Perhaps he should ask Hester Peirce if she has any ideas?