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| Hey Insider! It has been a day in the shadow of the impacts of the increased regulatory crackdown again for the crypto exchanges. Today's Inside Cryptocurrency newsletter covers Binance's employee benefit cuts amid a strong decline in profits, Coinbase's CEO meeting with House Democrats, the sudden jump in XRP's trading volume, and more. I hope you enjoy your reading! Doğa
p/dogayurduneri | |
| 1 | | Binance, the largest crypto exchange by trading volume, cut certain employee benefits, including mobile-phone reimbursement, fitness reimbursement, and work-from-home expenses, due to a fall in profits. In an internal message, the firm said the current market environment and regulatory climate caused a decline in profit, forcing it to be more prudent with spending. More: - Recent reports also showed that Binance laid off more than a third of its headcount, representing over 1,000 employees worldwide, after facing regulatory hurdles in the U.S.
- Former employees stated that several hundred additional customer service employees were also let go last week.
- In termination agreements, Binance required former employees to keep the terms of the document confidential, relinquish any claims against the company, and not make any negative statements about Binance.
- The cut in the employee number and benefits came shortly after the U.S. Securities and Exchange Commission (SEC) filed a 136-page complaint against Binance and CEO Changpeng Zhao (CZ) over alleged U.S. law violations.
- However, in a recent company meeting, Zhao told employees that the company is still profitable and not affected by the SEC's lawsuit.
- Binance CEO also added that he was not sure if and when benefits would be restored, and there could be additional layoffs every three to six months.
Zoom Out: - In the U.S., Binance is also under scrutiny by the Commodity Futures Trading Commission (CFTC), the Internal Revenue Service (IRS), and federal prosecutors.
- Over the last several months, the platform faced similar regulatory challenges in many other countries, including Australia, France, and Belgium, mainly due to compliance issues.
- Besides, the company recently had to withdraw from several markets in the West, including Canada, the Netherlands, Cyprus, and the U.K.
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| 2 | | 
What the numbers say: Payment protocol Ripple's native token XRP jumped in trading volumes following the firm's partial victory in the court. The popular cryptocurrency's daily trading volume increased to $11.25B one day after the ruling, up from $613.55M the previous day. Within the first four days of the ruling, the volume reached $22.9B in total. The figure was only at $2.18B during the four-day period before the partial victory. With this sudden surge, XRP also surpassed Bitcoin (BTC), the largest cryptocurrency by market cap, in trading volume by accounting for 21% of the total crypto market trading volume on July 17, while BTC represented a 20% portion. Relevance: The jump in XRP's trading volume was mainly triggered by the major crypto exchanges deciding to relist Ripple's native token after U.S. District Judge Analisa Torres ruled that XRP is not a security as long as it is sold to the general public. The judge's declaration was considered a partial victory for Ripple against the U.S. Securities and Exchange Commission (SEC) since the agency classified XRP as a security in a lawsuit filed in December 2020. In the case, the agency accused Ripple and some of its executives of the unregistered sale of nearly $1.3B of XRP tokens, which it labeled as securities. The ruling also caused a 90% increase in XRP's price. Brands that should care: The crypto exchanges relisting XRP include Coinbase, Binance.US, Kraken, Gemini, Bitstamp, and Crypto.com. | | | |
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| 3 | | The largest U.S. crypto exchange Coinbase's CEO, Brian Armstrong, has set to meet House Democrats privately on July 19. During the meeting, the renowned executive will share his views on digital asset legislation and related issues, such as tax, privacy, national security, and climate. More: - The meeting plan followed a lawsuit filed by the U.S. Securities and Exchange Commission (SEC) against Coinbase over alleged U.S. securities law violations.
- Most recently, the two sides came up against each other in the first court hearing of the case.
- Armstrong has previously urged U.S. lawmakers to establish clearer rules for digital assets and crypto service providers several times.
- Before the lawsuit, Coinbase also filed a petition requesting the court to force the SEC to create a clear framework for digital assets.
Zoom Out: - The lawsuit against Coinbase has become a wider crackdown on the crypto industry by the SEC.
- Over the last several months, many crypto exchanges, including Coinbase, Kraken, Bittrex, and Binance, came under increased scrutiny by the agency.
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| 4 | | The shareholders of the U.S.-based crypto mining company Marathon Digital have filed a lawsuit against CEO Fred Thiel and nine other senior executives based on five claims. The allegations in the lawsuit include breaching fiduciary duties, violating the U.S. Securities Exchange Act, enriching unjustly, and wasting corporate assets. More: - The shareholders also claimed that Thiel and three other executives contributed to the U.S. Securities and Exchange Commission's (SEC) complaint against the company through their wrongful acts.
- Also, the plaintiff's legal team accused the management of downplaying the company's issues, inflating Marathon's valuation artificially, obtaining excessive compensation, making profitable insider transactions, and receiving unjustifiably increased incentives based on false and misleading statements.
- The plaintiffs did not request a specific amount of compensation from the defendants, leaving it to the court.
- To correct Marathon Digital's governance, the shareholders proposed to improve the board's oversight of operations, nominate at least four shareholder candidates for the board, and eliminate the former procedure of electing directors.
Zoom Out: - Marathon Digital was served a subpoena two times by the SEC as part of an ongoing investigation related to the firm's data center facility in Montana.
- The SEC mainly claims that the data center could have violated federal securities laws.
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| 5 | | Web3 investment firm CoinFund has secured $158M in its latest fundraising round to invest in early-stage crypto startups. The company said it would prioritize startups working on the intersection of crypto and AI while investing the new funds. More: - CoinFund initially planned to raise $125M in funding, but the round saw more interest than expected.
- The firm has also managed to raise $550M during the last year's crypto winter seeing the collapses of high-profile crypto firms, including the previously third-largest crypto exchange FTX and the multi-billion dollar Terra ecosystem.
- CoinFund previously invested in several renowned startups like Dapper Labs, the firm behind the famous NBA Top Shot and CryptoKitties NFTs, and blockchain infrastructure provider Blockdaemon.
- Some portion of the new funding has already gone to Giza, a startup working on the integration of AI with smart contracts, and Superstate Inc. aimed to combine decentralized finance (DeFi) with mutual funds.
- CoinFund also said it would continue to invest in tokens with the new funding.
Zoom Out: - On the other hand, recent data has shown that global venture capital (VC) investments in crypto startups saw a drop for five consecutive quarters.
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| 6 | | Famous instant messaging app Telegram's CEO, Pavel Durov, has confirmed that he owns Toncoin (TON), the native token of The Open Network. Following the announcement, TON's price jumped by 3%. More: - Durov confirmed his Toncoin holdings through his personal Telegram announcement channel.
- In the announcement, Durov also said he still owns Bitcoin (BTC).
- Telegram CEO bought 2,000 BTC for $1.5M nearly a decade ago, which would be worth around $60M now.
- Besides, the platform executive stated that he would remain focused on his work without owning anything except Telegram, TON, and BTC.
Zoom Out: - The blockchain project TON was initially developed by Telegram as the platform's first big step toward Web3.
- However, the firm had to abandon the project in 2020 due to legal conflicts with the U.S. Securities and Exchange Commission (SEC), and the project was kept alive by the TON Foundation, embodying community members.
- The popular messaging app has also been developing a blockchain-based auction platform called Fragment on the TON network since last year.
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- The U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler said he is disappointed with U.S. District Judge Analisa Torres' ruling that XRP is not a security when sold to the general public.
- Binance, the largest crypto exchange by trading volume, has terminated its five-year partnership with the Argentine Football Association (AFA), citing a lack of compliance with the contract.
- Speaking at the Ethereum Community Conference in Paris, Circle's European Union Strategy and Policy Director Patrick Hanson has stated that euro-pegged stablecoins' future is bright thanks to the increasing real-world use cases.
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INSIDE CRYPTOCURRENCY LEADERBOARD (30 DAYS) |
 | Staff Writer | | Doga is a tech and science editor who has been writing news for nearly 10 years. She worked for leading tech platforms and mainstrem media channels as an editor and presenter throughout his career. Then, she carried her know-how to more than one platform. She is a part-time cat lover and binge-watcher, and also fond of science, space, and emerging tech. She always has a story to tell. She is a bit addict to the laughter and -unfortunately- the '90s culture. | | This newsletter was edited by Aaron Crutchfield | |
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