events – today
Today’s House Energy and Commerce Committee Full Committee Markup begins at 2 p.m. ET at Rayburn House Office Building. Chair Cathy McMorris Rodgers (R, WA) and Ranking Member Frank Pallone (D, NJ) will preside as 44 bills will be considered including two bipartisan bills with blockchain technology implications. [Hearing announcement; live video]
Also today, the House Financial Services (HFS) Subcommittee on Digital Assets, Financial Technology and Inclusion will hold a hearing titled: “Fostering Financial Innovation: How Agencies Can Leverage Technology to Shape the Future of Financial Services.” The hearing – led by Subcommittee Chair French Hill (R, AR) and Ranking Member Stephen Lynch (D, MA) – begins at 10 a.m. at Rayburn House Office Building. [Hearing landing page; Committee memorandum]
Judging from the memo, the HFS Digital Assets Subcommittee hearing looks to be an efficient way to understand at a high level what each U.S. financial services regulator is doing to address innovation or “novel activities” – i.e. do they have their own office of innovation; do they address it within existing infrastructure; what does that approach look like; and so on. The Consumer Financial Protection Bureau, run by Democratic appointee Rohit Chopra, may attract criticism from the Republican Members of the Committee due to the CFPB’s move away from an innovation-specific office in the past couple years.
more tips:
HFS Digital Assets Subcommittee prepared testimony for Michael Gibson, Director, Division of Supervision and Regulation, Federal Reserve – Federal Reserve
offshore – El Salvador Bitcoin
Good news for El Salvador President Nayib Bukele who tweeted yesterday that after the most recent Bitcoin price rally, his country’s horde of Bitcoin is now “in the black.” See his tweet on X with a graphic showing his country’s $130 million + in Bitcoin holdings. He wants a retraction from journalists who questioned his strategy.
“Of course, we have no intention of selling; that has never been our objective. We are fully aware that the price will continue to fluctuate in the future, this doesn’t affect our long-term strategy,” tweeted Bukele. His country made a big bet on the cryptocurrency by making it legal tender. Read an October 2021 report from PwC.
Hamas and stock market
A new report from Robert Jackson of NYU Law – a former Democratic SEC Commissioner – and Joshua Mitts of Columbia Law is causing a stir on X by saying that the terrorist organization Hamas may have made millions shorting the stock market at the time of the October terrorist attacks in Israel.
“… we identify increases in short selling before the attack in dozens of Israeli companies traded in Tel Aviv. For one Israeli company alone, 4.43 million new shares sold short over the September 14 to October 5 period yielded profits (or approximates avoided losses) of 3.2 billion NIS (~$860 billion USD) on that additional short selling.” Read the report titled “Trading on Terror” (PDF).
An examination of the data by Israeli publication Globes disputes the report somewhat. Whether these findings have an impact on the recent discussion ignited by the Wall Street Journal’s October 10 over digital assets impact on terrorist financing remains to be seen.
Former U.S. Treasury official Michael Mosier said on X about the new report, “Discovering months later that Hamas made BILLIONS in stock markets is why many ask government to prioritize the biggest (TradFi) gaps. Before focusing finite resources on preemptively closing theoretical gaps in exponentially smaller + immediately detectable tech w/ growing risk mgmt” – i.e. digital assets.
offshore – Digital Pound
The United Kingdom Parliament’s Treasury Committee is urging the Bank of England and the country’s treasury department to ‘proceed with caution’ as it considers a central bank digital currency (CBDC) – known locally at the Digital Pound. The insights from the Committee are contained in a new paper skeptically titled, “The digital pound: still a solution in search of aproblem?” Download it.
Though it sees some possibilities with a wholesale CBDC, the Committee worries about a retail CBDC stem in part from concerns around bank deposit outflows. If consumers are using a CBDC, the nature of deposits change. Consumers don’t need to leave deposits at a bank which are often important underpinnings of a bank’s stability.
There’s a lot more to this report. Read a summary in Ledger Insights.
offshore – more
Brazil’s largest private bank, Itaú Unibanco, announced new cryptocurrency trading services for Bitcoin and Ether – Bitcoin Magazine
Societe Generale issues a first digital green bond on a public blockchain – press release
events – former regulators
Georgetown’s Psaros Center for Financial Markets and Policy will be offering a webinar this Thursday (12 noon ET) on the way forward for regulating crypto markets with Former Commodity Futures Trading Commission (CFTC) Chair Tim Massad (D) and Former Securities and Exchange Commission (SEC) Chair Jay Clayton (R). Register here.
still more tips
Asset Manager Abrdn, Crypto Exchange Archax Strive for Pole Position in Race to Tokenize TradFi – CoinDesk
Crypto execs say the bull run is underway and could lead to $100,000 bitcoin in 2024 – CNBC
Binance Copped a $4 Billion Plea but Is Still Fighting the SEC – The Wall Street Journal