Bitcoin ETFs Boomerang Refilings; OTC Framework For Tokens?

Bitcoin ETF – refilings

On Friday, the Securities and Exchange Commission (SEC) informed NASDAQ and Cboe that their applications were “inadequate” due to a dearth of information on their surveillance sharing arrangements for a Bitcoin Spot ETF. The Wall Street Journal reported that the two firms “filed the applications on behalf of asset managers including BlackRock and Fidelity Investments.” Read it. ”

By late Friday, at least 5 companies total had refiled (see Cboe’s filing) with the SEC given the reported guidance by the agency earlier in the day, according to  Bloomberg. Also, amended to each of the filings was “that Coinbase Global Inc. will provide market surveillance in support of” each of the funds. Read more in Bloomberg.

SEC, your serve.

Bitcoin ETF – McHenry

When the news on the SEC rejection of the Bitcoin Spot ETF applications on Friday, House Financial Services (HFS) Committee Chair Patrick McHenry (R, NC) didn’t take it well. He tweeted, “If these reports are accurate, [Gary Gensler] has a lot of explaining to do. An ETF would provide everyday investors with an SEC-regulated product. The only reason for Chair Gensler to oppose is if he wants to kill crypto in the U.S. all together.” See the tweet.

CFTC digital assets

In advance of the July 17 Global Markets Advisory Committee (GMAC) meeting, committee sponsor and Commodity Futures Trading Commission (CFTC) Commissioner Caroline Pham announced a whopping 128 new members across the committee’s leadership including the new Subcommittee on Digital Asset Markets.

The Digital Assets Subcommittee alone boasts 37 members. View now.

Bitcoin ATMs – public

Bitcoin ATMs are evidently a good enough business to go public. CoinTelegraph says the seeds of today’s public offering came from a  proposed merger by SPAC (special purpose acquisition company) GSR II Meteora Acquisition Corporation and Bitcoin Depot last August according to Cointelegraph. The deal closes today making Bitcoin Depot public.

Read the release from Friday which says Bitcoin Depot “users can convert cash to Bitcoin at Bitcoin Depot’s kiosks and at thousands of name-brand retail locations through its BDCheckout product. The Company has the largest market share in North America with approximately 6,440 kiosk locations as of March 31, 2023.”

Bitcoin ATMs – scrutiny

What will be interesting here will be the quarterly public filings of revenues for Bitcoin Depot going forward. How big is the Bitcoin ATM business? Traditional banks will be watching closely for opportunity.

Also, the public listing of Bitcoin ATMs, could rekindle the interest of Sen. Elizabeth Warren (D, MA) and Sen. Roger Marshall’s (R, KS) Digital Asset Anti-Money Laundering Act from the last Congress who specifically identified crypto ATMs as an illicit finance threat. From the Senators press release last December on the purpose of the bill, in part: “Mitigate the illicit finance risks of digital asset ATMs by directing FinCEN to ensure that digital asset ATM owners and administrators regularly submit and update the physical addresses of the kiosks they own or operate and verify customer identity.”

summer reading

“Eigenlayer provides developers with access to the Ethereum staked capital base and decentralized validator set” – Read the Eigen Layer white paper

extend to tokens

OTC Markets Group Deputy General Counsel Cass Sanford discusses crypto regulation with financial publication Capitol Account.  Her company’s ATS (alternative trading system) businesses arguably reveal an opportunity to extend the Over-The-Counter markets “long-standing framework of broker-dealer regulation that offers protections for investors” to tokens.

Capitol Account notes that OTC Markets recently received from Finra a “sort of” approval to facilitate token trading.  Sanford explains, “We have updated our membership agreement with FINRA to permit our broker-dealer subscribers – firms like Virtu, Citadel and GTS – to trade digital asset securities on our ATS.” Read more.

see more tips

Meet the 9 power players shaping the UK’s growing crypto agenda – The Block

From Liquidation to “Celebration:” Inside Sotheby’s $17M Grails Sales – NFT Now

Opinion: Apparently It’s Very Difficult to Custody Crypto – CoinDesk

Biden names new White House digital chief with plans to continue outreach to creators, influencers – Associated Press

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