Gensler’s Likely Exit as SEC Chair Sparks Legal Backlash

The Breakdown First Five - Friday, November 15, 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. Bitfinex Hacker Gets 5 Years

Ilya Lichtenstein has been sentenced to five years in prison for attempting to launder the 120,000 BTC stolen from Bitfinex in 2016. The self-taught hacker received a glowing sentencing recommendation from prosecutors, praising Lichtenstein for his cooperation and testimony in other crypto money laundering cases. Apparently it wasn’t enough to spare him from prison for one of the largest heists in crypto history. Razzlekahn will be sentenced on Monday

4. Clayton Coming to SDNY

Former SEC Chair Jay Clayton has been tapped to act as the US Attorney for the Southern District of New York under the Trump administration. The SDNY handles cases out of Manhattan and is traditionally the DOJ office that deals with the majority of financial crime. They prosecuted most of the Crypto cases, including Binance and SBF. Clayton filed the Ripple lawsuit on his last day at the SEC in 2021, but has taken a pro-crypto turn in the interim. 

3. Inflow Streak Broken 

The heat has come out of the market with Bitcoin ETFs seeing their first day of outflows since the election. $400M was redeemed from the funds as Bitcoin fell below $88,000. ARK and Bitwise experienced their largest outflows to date, $160M and $114M respectively. Blackrock was one of the few to experience inflows, a very mild $126.5M. The momentum is over for now. 

2. Vaneck Turbo Bullish

With Bitcoin off the highs, VanEck’s Matthew Sigel is still locked in for the bull run. Speaking on CNBC, he said that Bitcoin will make repeated new highs well into next summer. He estimated the top will be in at $180,000. Putting it in context for the crypto naive audience, he said “"That would be a 1,000% return from the bottom to the peak this cycle. That’s still the smallest bitcoin cycle by far."

1. Gensler’s Farewell Speech 

Gary Gensler has delivered what many believe will be his final statement as SEC Chairman. He congratulated himself for approving crypto ETFs with no mention that he was forced to do so by the courts. Gensler made no indication he would resign, but said he’s been “proud to serve” with his colleagues. White Collar Defense partner Brad Bondi is viewed as the frontrunner to replace after Chris Giancarlo said he’s not cleaning up after Gensler for a second time. Minutes after Gensler’s speech was published, 18 states sued the SEC on behalf of the crypto industry.