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The issuers of the stablecoin Tether (Tether International Limited) announced a change in the way the company will manage their reserves going forward. Yesterday, the company elaborated on the Tether blog, “Starting this month, Tether will regularly allocate up to 15% of its net realized operating profits towards purchasing Bitcoin (BTC).” Read the post.
The company said it would self-custody all of its Bitcoin as a reflection of their belief in “not your keys, not your coins.” Unspoken may be the potential for government censorship of the company and its stablecoin -hence the move to Bitcoin and self-custody.
Does this mean Tether is moving away from other reserve types such as short-term U.S. Treasuries?
Tether’s Latest Q1 2023 Assurance Report Shows Reserves Surplus At All-Time High of $2.44B, up $1.48B in Net Profit; New Categories for Additional Transparency Reveals Bitcoin and Gold Allocations – Tether, May 10
Putting the ‘Stable’ in ‘Stablecoins:’ How Legislation Will Help Stablecoins Achieve Their Promise
9:00 AM in 2128 Rayburn House Office Building
House Financial Services’ Subcommittee on Digital Assets, Financial Technology and Inclusion
Committee Memo | Live Webcast
Senator Ed Markey (D, MA) added a new co-sponsor this week for his “S.661 – Crypto-Asset Environmental Transparency Act of 2023.” Congress.gov reports that Senator Diane Feinstein (D, CA) is providing her support for the bill amid calls for her resignation.
Senator Jeff Merkley (D, OR) and Senator Bernie Sanders (D, VT) were already co-sponsors.
On March 8, Senator Markey led a hearing of Senate Environment and Public Works’ Subcommittee on Clean Air, Climate and Nuclear Safety which reintroduced Markey’s bill intended to assess “cryptomining” (Bitcoin) impact on the environment and understand what disclosures are needed for mining operations.
TuongVy Le, Bain Capital Crypto’s head of policy and former SEC counsel tells Fortune that the SEC’s efforts to eliminate the “blockchain” industry are, well, wrong.
She says, “That has economic and political significance that goes really far beyond the question of whether someone can invest in Dogecoin. (…) The question of should blockchain be allowed to exist in the U.S. is a major question that goes well beyond the mandate of not just the SEC, but every single regulator.” Fortune’s Leo Schwartz posits that blockchain’s lifeline may be the Supreme Court and its 6-3 conservative majority. Read more.
On CoinDesk, Tuongvy Le and her fellow Bain Capital Crypto counsel Khurram Dara deliver an op-ed saying that regulators should not “front run” Congress – particularly on payment stablecoins. Read that one, too.
custody use case
Fintech company Ripple announced yesterday it has acquired Switzerland-based Metaco whose core product is a cryptocurrency custody solution. Nevermind, apparently, that Ripple is currently involved in an expensive lawsuit with the Securities and Exchange Commission over the issuance of its XRP token. The company wants to grow its enterprise and financial institution custody business said a company blog post. Read it.
Given the acquisition, Ripple says, “Ripple will expand its enterprise offerings providing customers the technology to custody, issue, and settle any type of tokenized asset.” TechCrunch reports that Ripple acquired Metaco for $250 million in cash and Ripple equity. Read that one.
crypto regulated as gambling
The UK has been moving forward with its development of a regulatory framework for digital assets based on its use as a financial instrument. But, a new report from the UK’s Treasury Committee – made up of “cross-party Committee of MPs” – suggests crypto should be regulated similar to gambling.
“The Committee concludes that cryptocurrencies pose significant risks to consumers, given their price volatility and the risk of losses. Given retail trading in unbacked crypto more closely resembles gambling than a financial service, the MPs call on the Government to regulate it as such,” says the Committee.” Read the report.
still more tips
SEC Labels Filecoin as a Security in Response to Grayscale Application – Decrypt
Fidelity International Cautious and Curious on Crypto, Expects Asset Class to Mature – Blockworks
Bankrupt crypto lender Voyager Digital predicts 35% customer payout – Reuters
Jia, a blockchain-based lender of small businesses in emerging markets, raises $4.3 million seed – TechCrunch
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