US Securities and Exchange Commission Chairpersonman Gary Gensler

The US Securities and Exchange Commission filed suit against Binance and Coinbase in separate actions this week. There has been a tendency to personalize these actions as being the work of Chairpersonman Gary Gensler.

“Rock, paper, scissors? I have the rock! I am the bloody ROCK!”

In the context of “knowing one’s adversaries” — who is this guy? Continue reading


FTX – Tom Brady Is In – ARE YOU?

There is little to be added to the colossal shit storm that is FTX.

Thousands of people lost millions of dollars directly (Sequoia $213MM) or indirectly (Ontario Teachers’ Pension Plan $95MM). Wow, that is a lot of teacher pension money.

Crypto Wunderkind Sam Bankman – Fried who raised $1.7B in funding over 7 rounds since 1 Jan 2018.

The enablers are coming out of the woodwork to ensure that everybody knows this is NOT an indictment of the entire Crypto World or WebIII. Good luck with that.

It is just some low grade incompetence or imprudence with a possible bit of criminal behavior – the SEC and the FBI are looking into that wrinkle.

What is not happening is any chatter from FTX’s celebrity endorsers. Continue reading


Crypto Goes To War

The brutal, savage, unprovoked invasion of peaceful Ukraine by the barbaric, uncivilized Russians has given rise to a laboratory experiment in the role of crypto currency in contentious times. Crypto has gone to war.

 1. The Ukes are using crypto to fund their defense.

 2. The Russians are using crypto to avoid the sting of economic sanctions that have their entire banking system — entire economy really — on the ropes.

 3. The crypto exchanges, upon being asked to freeze all Russian accounts, have refused to comply — Coinbase, Kraken, Binance.

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The Texas Cryptocurrency Love Affair Blossoms

The Governor of Texas, Greg Abbott, a truly great governor, has signed into law something called the Virtual Currency Bill which began life as House Bill 4474 as sponsored by Representative Tan Parker a huge supporter and proponent of blockchain technology and cryptocurrency.

The bill was considered by the Texas House of Representatives’ Pensions, Investments, and Financial Services Committee which revised the bill after extensive hearings and public input into a Committee Substitute Bill which they passed with bipartisan support in the middle of April.

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Bitcoin $30,000, Inviting Increased Regulation?

BBBBBBBBBitcoin has been on a run recently with its quoted price as high as $28,288.84 on 27 December 2020. The total value of all BTC is now flirting with half a trillion USD.

Huge consideration — there will only ever be 21,000,000 BTC. Constrained supply in the face of increasing demand? What does that suggest with an Econ 101 beanie on?

Highest price BTC, 27 Dec 2020 – $28,288.84

Lowest price BTC, 5 July 2013 – $65.53

If you have been into BTC for a long time, you likely have a big smile on your face.

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Kik Gets Poured Out v SEC

Two weeks ago, Judge Alvin Hellerstein, Federal District Judge of the Southern District of New York, ruled that Kik’s $100,000,000 token distribution event was an illegal issuance of a security — an unregistered securities offering — based upon his analysis of the Howey Test.

It is important to note that Judge Hellerstein’s ruling was on the SEC’s Motion for Summary Judgment, a preliminary action prior to the case being heard. A Motion for Summary Judgment requires there to be little or no disagreement on the facts and thus becomes a matter of the application of only the law.

It would be fair to say that the Judge saw the facts as being agreed by the warring parties and thus was able to opine solely on the law. This rarely happens as there is usually some fact that is in dispute.

This case was a much-watched case and was touted as an important bellwether crypto case.

It is, in reality, a disappointment in its lack of fanfare and grandeur, a yawningly predictable Howey Test case as many — myself included — said from the beginning. Yawn. Sorry.

The United States Securities and Exchange Commission made the noted charge whilst Kik denied that their issuance of “Kin” was an unregistered securities offering.

The parties now have until 20 October 2020 to thrash out some form of an agreement. Stay tuned, amigos.

Understandably, the SEC has the upper hand in this matter whilst Kik is in the unenviable position of negotiating whilst at a huge disadvantage.

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Facebank And Libra II

While we were all distracted by the life and death of COVID19, our friends at Facebank have made a few changes in their quest to make Libra a viral offering in the crypto world.

You will recall that we spoke of Facebank’s Libra offering here:

Facebank And Libra

Cracks In The Libra Foundation

Libra Foundation Crack Update

Libra V The Senate

So, recently we learn that Facebank, with its newly trimmed roster of supporters, has made a slight pivot. The pivot is driven by the reality of the political and regulatory pushback.

In other words, creating Libra isn’t the two handed dunk shot Facebank, et al, thought it would be.

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