Coinbase CEO Armstrong On OpenAI Drama; FDIC’s Gruenberg Under Pressure

OpenAI drama

With the news breaking late Friday that OpenAI CEO Sam Altman had been fired by his board, the media was scrambling to make sense of it: what it means for artificial intelligence, investing and the players involved.

Coinbase CEO Brian Armstrong, a Silicon Valley veteran, provided his “take” on X: “If this is really some EA (effective altruism), decel, AI safety coup at OpenAI, the board just torched $80B of value, destroyed a shining star of American capitalism, and will be sued to high heaven by investors. Every talented employee at OpenAI should quit and join Sam/Greg’s new thing (if they make one). This time, skip the woke non-profit board, eject the decels/EAs, maintain founder control, avoid nonsensical regulation, and just build. Accelerate progress. You are building something good for the world, don’t let anyone make you feel guilty for it and try to capture it for their own motives.” And that wasn’t all. Read more from Armstrong.


Sam Altman Not Returning As CEO Of OpenAI – The Wall Street Journal

bitcoin ETF update

The unveiling of multiple Bitcoin spot market ETFs (Exchange-Traded Funds) by the Securities and Exchange Commission (SEC) was not to be last Friday. “As expected” – as some analysts claimed – the SEC wanted more clarifications before the final approval. We shall see. According to Bloomberg ETF analyst Eric Balchunas something called “cash creates” was the cause of the latest delay.  He went into the weeds on X, “Only 2-3 filers had planned cash creates, the rest wanted to do in-kind. So may have to adjust or risk delay. Anyway, this doesn’t change our 90% odds up or down but is good sign the process marching and SEC has a path fwd in the plumbing that they are comfortable with.” Read his tweet thread.

what you should know: This “90%” expectation of approval by January is being reported across the media. Could SEC Chair Gary Gensler still put his finger on the scale and prevent this potential market catalyst from happening in January, too? The WSJ says the deadline can get extended in the new year.

NY state of veto

New York Governor Kathy Hochul (D) vetoed a bill on Friday which would have created “a 16-member task force to study digital currencies and their ancillary systems, including blockchain technology, in the state. In addition to assessing the tax impacts of digital currencies, the task force was designed to review the number of digital currencies being traded and their approximate market share, the energy consumption necessary for coin mining operations, and more.” Read more on Bloomberg (subscription).

And, see Assembly Bill A954.

New York State Assemblyman Clyde Vanel (D), a “pro-crypto” lawmaker, responded on X saying, “I am disappointed that [Governor Hochul] vetoed the #Crypto bill. It is important for NY to work with stakeholders seeking a regulatory regime that strikes the proper balance of protecting consumers & investors, while fostering an environment for economic growth, jobs & innovation.”

what you should know: It was a year ago that Governor Hochul appeared to side with the anti-crypto camp and signed a bill which curbed crypto mining activities in the state. Nevertheless, Hochul also appears to support New York Department of Financial Services (NYDFS) Superintendent Adrienne Harris’ efforts to maintain “parallel” (states’) rights in any Federal stablecoin legislation – something the anti-crypto camp does not want.

opinions flying

The Wall Street Journal’s October 10 article on crypto and the funding of terrorism has led to still more opinions. In an op-ed in The Washington Post on Thursday, a16z head of policy Brian Quintenz, who is a former commissioner with the Commodity Futures Trading Commission, takes issue with a damning opinion written by WaPo’s own editorial board a week earlier on the topic of ending crypto altogether.  Quintenz takes the other side and says, “… good regulation would ensure the future of the internet is not solely controlled by a handful of tech companies, including by creating stronger revenue streams for artists, democratizing finance and giving consumers control over their data.” Read Quintenz’ piece.

more tips:

Opinion: “Treat Hamas like ISIS: Use financial warfare to crush them” – Shlomit Wagman in The Hill

what you should know: Quintenz conclusion fits well with the bipartisan interests of many in Congress who believe that “big tech” needs to be reined in.

still more tips

New congressional letter: “Financial Services Committee Republicans Launch Investigation into Gruenberg Misconduct, Toxic Workplace at FDIC” – House Financial Services Committee

Fidelity Wants to Create an Ether ETF, Joining BlackRock in Doubling Down on Crypto – CoinDesk

Opinion: How to Win the Fight for America – Katherine Boyle, a16z, The Free Press