SEC Drops Ethereum Investigation

The Breakdown First Five - Wednesday, June 19, 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. ETH ETF Progress

Asset managers have received comments from the SEC late last week and are now preparing revised filings. Sources described the comments as “light” and “reasonable.” The deadline for updated filings is Friday, with an expectation that many won’t take that long to submit. There could be another round of revisions before the products are approved to begin trading but that might not be necessary. Everything looks on track for a launch either next week or the following. 

4. Bitcoin Down, Alts Obliterated

Bitcoin continues its summer drawdown, dropping below $65,000 and breaking through on-chain realized price, which typically acts as support. While Bitcoin had a negative day, alts were a deep red bloodbath. Basically everything was down, but Dogecoin had the worst day. It fell more than 10% on the back of $60M in liquidated longs, the worst liquidation cascade for Doge since May 2021 when Elon shilled the coin on SNL.  

3. ETH x BTC 

Hashdex has filed to launch an ETF that would combine spot Bitcoin and Ethereum exposure. The product would apply a 70-30 weighting to the assets, but will rebalance according to their relative market caps. Hashdex already has similar products offered in their native Brazil, including a product that goes much deeper into top 10 crypto tokens using a cap weighted index. This product, if approved, would be allowed to add additional tokens over time. 

2. The DJT Investigation

Crypto Twitter is on the case of the new Trump token, rushing to find out whether it’s truly affiliated with Trump or just a hoax by a rogue dev. Arkham Intelligence offered a $150,000 bounty for identifying the token’s creator. Information from ZachXBT indicates that Martin Shkreli created the token alongside Baron Trump. Polymarket users seem unconvinced that Donald knew anything about the coin, taking odds down below 9%. Shrekli rejected a 9-figure GCR bet. 

1. SEC Drops Ethereum Investigation

According to Consensys, the SEC has dropped its investigation into Ethereum. The investigation was largely related to the Merge and whether the transition to proof of stake turned Ethereum into a securities offering. Things ramped up earlier this year with a bevy of subpoenas issued to companies and developers involved with the protocol. Consensys ultimately sued the SEC in April, asking the Court to bring an end to the investigation. The lawsuit will remain ongoing.