Tag: blockchain

Coinbase launches policy group

Coinbase announced yesterday a new policy group which builds on its previous advocacy efforts known as Crypto435, a Coinbase campaign to organize the crypto community around legislative issues.

Named the “Stand With Crypto Alliance” the new grassroots, non-profit group invites interested parties to mint an NFT with the image of the group’s shield branding, share their contact info for future communications and submit donations.  The Alliance’s “Join” page already shows over 51,000 members as of this writing.

Coinbase says in its previous effort, the inaugural Stand with Crypto shield was minted over 160,000 times – raising $215,000 for crypto advocacy organizations – and a pro-crypto onchain petition garnered over 188,000 signatures.” This time the company appears to be spearheading the advocacy rather than delegating it to other industry organizations. Read more.

Faryar Shirzad, Coinbase’s Chief Legal Officer, tells CNN that “‘We found ourselves kind of overwhelmed, to be honest, by the level of response that we’ve gotten’ to Crypto435, Shirzad said. Across all 435 congressional districts, ‘the amount of energy and and motivation that we’re seeing among the group is enormous, and so we thought we need to evolve this thing.'” Read that one.

more tips:

Coinbase Expands into Canada – press release Continue reading “Coinbase Launches Policy Group; Pitching Progressives On Crypto”

House floor passage

Rep. French Hill (R, AR), Chair of the House Financial Services (HFS) Subcommittee on Digital Assets, Financial Technology and Inclusion expressed optimism on getting digital assets legislation passed on the House floor this fall on Fox Business Friday.

Rep. Hill told Fox’s Maria Bartiromo: “On the digital front, you’re right. America should be the leader in Web3, the leader in distributed ledger technology and digital assets innovation. This will create jobs, expand opportunities for Americans. But again, Gary Gensler at the SEC is operating by enforcement. So what Patrick McHenry, the Chairman of the Financial Services Committee, and I have tried to do working with our friends on the Ag Committee, is create the right, targeted regulatory process for digital assets – both for commodities, over in the Ag Committee, and for tokens that might be considered securities in the SEC jurisdiction. We think this will bring back money to the U.S., jobs to the U.S., and innovation to the U.S., and we hope we can get that through the House floor this fall.” See the video clip on X.

Headlining the recent digital asset bills coming out of the HFS Committee in late July are the digital asset market structure and stablecoin bills. Continue reading “Rep. Hill Talks House Floor Passage For Digital Assets; PayPal On Stablecoin Differentiation”

crypto ATM and NDAA

CoinDesk interviews Brandon Mintz, who is CEO of Atlanta-based Bitcoin ATM Operator, Bitcoin Depot, which has 20% market share. Mintz tells the crypto publication that the bitcoin ATM business is ripe for consolidation -and, that one of the reasons many companies fail, is a lack of compliance to existing regulations. Mintz tells CoinDesk, “My goal was always to create the strongest compliance program and hire really good compliance staff, including a compliance officer that I hired very early on in the business…” Read more.

In late July, Cato Institute did a comparison of the Anti-Money Laundering (AML) and Know-Your-Customer (KYC) aspects of the bills from Senators Elizabeth Warren (D, MA) and Roger Marshall (R, KS) – S.2669 -as well as Senators Cynthia Lummis (R, WY) and Kirsten Gillibrand (D, NY) – S.2281. In each of these bills are specific ATM provisions.

The latest KYC-AML “bill” from the Senate is the National Defense Authorization Act (NDAA) amendment from an alliance of the four Senators and includes ATM stipulations requiring complete disclosure of ATM usage.  How the must-pass NDAA and this amendment shake out in negotiations with the House remains to be seen.

A sampling of the amendment shows the Director of the Financial Crimes Enforcement Network (FinCEN) to requiring “crypto asset kiosk owners and administrators to submit and update the physical addresses of the kiosks owned or operated by the owner or administrator, as applicable, once every 120 days and collect the name, date of birth, physical address, and phone number of each counterparty to a transaction…” See it on Congress.gov.

more tips:

Crypto ATM Number Net Changes – Coin ATM Radar Continue reading “Crypto ATM Compliance Amid NDAA Amendment; Crypto Counsel For CFTC Commissioner”

stablecoin rules – Waters

With the news of PayPal’s stablecoin breaking on Monday, and then the Federal Reserve conveniently introducing new crypto rules for banks a day later, yesterday, House Financial Services (HFS) Ranking Member Maxine Waters (D, CA) kept up the drumbeat of pushback by Democratic leadership on the new stablecoin bill.

“I am deeply concerned that PayPal has chosen to launch its own stablecoin while there is still no Federal framework for regulation, oversight, and enforcement of these assets,” began Waters in her statement released on the Democrats’ House Financial Services website. Later, she doubled down on rejection of the stablecoin bill and what could be construed as a message from the White House: “As I said during last month’s markup, the Republican bill has no chance of actually being signed into law, and I urge Chair McHenry and Committee Republicans to come back to the negotiation table…” Read more.

On Monday, HFS Chair Patrick McHenry had come out in support of PayPal’s new stablecoin efforts.

stablecoin rules – Waters history

It was only last March that Waters was fully supportive of moving a stablecoin bill forward “as quickly as possible” and then suddenly, at the first HFS stablecoin hearing in April, came her about-face with Rep. Stephen Lynch (D, MA), Ranking Member of the Committee’s Subcommittee on Digital Assets, Financial Technology and Inclusion, stridently backing her up. Continue reading “Waters Doubles Down Saying Stablecoin Bill Has ‘No Chance’; SEC Intent On Ripple Appeal”

Fed oversight for crypto

Late yesterday, the Federal Reserve announced a more detailed regime for banks offering, or considering offering, crypto products – or as the Fed terms it – the “novel activities supervision program.” Read the press release.

Among the regime’s elements subject to supervision:

• • “Complex, technology-driven partnerships with non-banks to provide banking services…”
  • “Crypto-asset related activities…”
  • Projects that use [distribute ledger technology] with the potential for significant impact on the financial system…”
  • “Concentrated provision of banking services to crypto-asset-related entities and fintechs…”

Adding to the warning to banks, “The Program will be risk-based, and the level and intensity of supervision will vary based on the level of engagement in novel activities by each supervised banking organization.” The more a bank adds digital asset products, the more it receives supervision by the Federal Reserve.

The announcement is reminiscent of the January 3 warning titled, “Joint Statement on Crypto-Asset Risks to Banking Organizations” by the Fed, Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC). See that one (PDF).

The Fed claims in yesterday’s announcement that it’s supporting innovation, but remains – at best – cautious stating, “The goal of the novel activities supervision program is to foster the benefits of financial innovation while recognizing and appropriately addressing risks to ensure the safety and soundness of the banking system.”

As Reuters notes, stablecoins are an important element of the directive, perhaps inspired by Monday’s PayPal stablecoin announcement. “For banks to receive a written non-objection to be able to engage with stabelcoins, banks should demonstrate appropriate risk management, including having systems in place to identify and monitor any potential risks, including cybersecurity and illicit finance threats,” reports Reuters. Read more.

more tips:

Letter SR 23-7: Creation of Novel Activities Supervision Program – FederalReserve.gov

Letter SR 23-8 / CA 23-5: Supervisory Nonobjection Process for State Member Banks Seeking to Engage in Certain Activities Involving Dollar Tokens (stablecoins) – FederalReserve.gov Continue reading “Fed Starts Crypto Activities Supervision Program; SEC Accounting Regime Attracts Criticism”

new PayPal stablecoin

Payment platform PayPal arguably made the most pro-crypto announcement of the year yesterday when it announced the introduction of its new stablecoin, PayPal USD (PYUSD) which runs on the Ethereum blockchain. Read the release.

Like many stablecoins PYUSD is backed 1:1 with the US Dollar and this one is managed by Paxos Trust. PayPal was issued a BitLicense by New York Department of Financial Services in June 2022.

TechCrunch looks at PayPal’s crypto development history including when the company introduced crypto services back in 2020. Read it.

The significance of PayPal – with a $71 billion market cap – taking its next step in digital assets is, perhaps, the leading edge of traditional finance firms embracing digital assets and stablecoins, in particular. Equally important is the US Dollar finding another on-ramp into the Web3 ecosystem. Squeaky blockchain transactions are getting a bit more of the oil they need.

The press release explains that the rollout, which started yesterday for PayPal customers, will allow them to: Continue reading “PayPal Announces Stablecoin; Chair McHenry Sees ‘Signal’”

Coinbase seeks dismissal

Cryptocurrency exchange Coinbase asked a judge to dismiss the SEC’s lawsuit against the company on Friday. The company’s Chief Legal Officer Paul Grewal said in a Tweet thread, “Our core argument is simple – we do not offer ‘investment contracts’ as that term has been construed by decades of Supreme Court and other binding precedent.” Therefore, the suit is baseless, reasons the Company. See the dismissal request (PDF).

Coinbase seeks dismissal – reaction

Jason Gottlieb, a partner and digital assets chair with law firm Morrison Cohen, complimented the company’s brief on Twitter, and argued that the Securities and Exchange Commission (SEC) has overreached. Gottlieb made note of the use of the “Major Questions Doctrine” (MQD) in Coinbase’s motion to dismiss tweeting the company could have gone even further in its argument.  Later, Gottlieb argues, “As everything is becoming digitized, this fight isn’t just about cryptocurrency. It’s a much larger battle for the right to your digital life — and whether the Securities and Exchange Commission is the proper regulator for the entire digital economy.”

Digital assets are at the forefront of regulating and integrating technology into U.S. government and its policies today. Continue reading “Coinbase Seeks Dismissal Of SEC Lawsuit; Digital Chamber Advocates Against AML Bill”