Regulatory Breakthrough With Bitcoin ETF; Digital Assets Hearing On Illicit Financing Today

regulatory breakthrough

In an interview on CNBC’s Squawk Box, CEO Cathie Wood of investment management firm Ark Invest said she think it’s possible for Bitcoin to reach $500,000 by 2025 or 2026. She saw a spot Bitcoin ETF as a key catalyst. She explained, “I think this regulatory breakthrough (the ETF) is very important to bring institutions online, effectively. I think BlackRock and Coinbase’s partnership is going to be very important. The other thing that is going to be very important – way back in 2018, Cambridge Associates, which advises institutions, said, ‘You may not like it. But, you better have a point-of-view because this is a new asset class, it’s a source of diversification..’ and we would add,  it’s a hedge – if you are talking about Bitcoin, in particular – against both inflation and deflation…” See a bit more of the interview on X.

more tips:

“it’s been a ten year dress rehearsal. we’re ready for the main event.” – Michael Sonnenshein, CEO, Grayscale on X

what you should know: We may know as soon as this week on Bitcoin spot market ETF approval by the Securities and Exchange Commission. More likely is approval by January.

use case – collectibles

Disney is getting into the digital collectibles space with a new NFT platform supported by Dapper Labs called Disney Pinnacles. NFT Now describes it as “a digital pin collecting and trading platform that will feature characters from an entire century of Disney magic alongside fan-favorite icons from Pixar and the expansive universe of Star Wars heroes and villains – all uniquely styled as tradable digital pins.” Read more. Built on the Flow blockchain similar to NBA’s Top Shot – which is also managed by Dapper Labs – the platform is set to launch “later this year.” In the meantime, there’s a waitlist.

today

House Financial Services (HFS) Digital Assets, Financial Technology and Inclusion Subcommittee will hold a hearing at 2 pm ET today titled, “Crypto Crime in Context: Breaking Down the Illicit Activity in Digital Assets.” See the hearing page and live video.

The five witnesses are:

    • Bill Hughes, Senior Counsel, ConsenSys
    • Jane Khodarkovsky, Partner at Arktouros
    • Jonathan Levin, Co-Founder & Chief Strategy Officer, Chainalysis
    • Gregory Lisa, Chief Legal Officer, DELV (f/k/a Element Finance, Inc.) and Senior Counsel, Hogan Lovells
    • Alison Jimenez, President, Dynamic Securities Analytics, Inc.

Hughes, who worked at the Department of Justice earlier in his career, is emphatic in his prepared testimony regarding the impact of centralized exchanges and financial crimes related to crypto. He writes on behalf of Consensys, “From our perspective, the single most important initiative in a fight against digital asset money laundering would be to regulate these entities under a common legal framework worldwide.”

No doubt the recent Wall Street Journal articles (1, 2) on Hamas and terrorist financing via crypto will be brought up by both sides of the aisle as various “flavors” of anti-money laundering legislation lurks in both Houses.

what you should know: There’s also a prudential regulator hearing at 9:30 a.m. ET today under the auspices of House Financial Services. See it. The FDIC workforce culture scandal will likely be the topic as it was at yesterday’s Senate Banking hearing with the same witnesses.

enforcement results

Yesterday, the SEC announced its enforcement results for the fiscal year ending September 30, 2023.  Crypto was a “highlight” for the agency as the press release outlined, “Fiscal year 2023 was another highly productive and impactful year for the SEC’s enforcement efforts relating to crypto asset securities. In fiscal year 2023, the Division recommended enforcement actions addressing a range of alleged misconduct in the crypto asset securities space, including billion-dollar crypto fraud schemes, unregistered crypto asset offerings, platforms, and intermediaries, and illegal celebrity touting.” Read more.

still more tips

Standard Chartered to use FundsDLT for blockchain-based transfer agency – Ledger Insights

Opinion: The IRS and the Rising Cost of Crypto Tax Compliance – David Kemmerer, CEO of CoinLedger, on CoinDesk

After six quarters of falling venture interest, crypto investors see recent price gains as positive signal – TechCrunch