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| Here is a quick look at the hits from the week's first Inside Cryptocurrency briefing: - Stablecoin issuer Circle's partnership with Japanese financial services giant SBI Holdings,
- The European Central Bank president's son losing almost all of the money he invested in crypto,
- The jump in Coinbase's share price following Binance's $4.3B settlement deal with U.S. regulators, and more.
Enjoy your reading! Doğa
p/dogayurduneri | |
| 1 | | U.S. Judge Richard Jones has put on hold a previous court decision that allowed Changpeng Zhao (CZ), the former CEO of crypto exchange Binance, to return to his home in the United Arab Emirates (UAE) while awaiting sentencing on Feb. 23, 2024. The move mandates that Zhao stays in the U.S. until the court makes a final decision on the issue. More: - The move came several days after the U.S. prosecutors requested a review and overturn of the previous decision by another judge.
- At the time, the prosecutors pointed out that the former CEO would present an unacceptable flight risk if he is allowed to leave the country pending sentencing.
- The filing also underlined that if the Binance co-founder decides not to come back, the government would not be able to guarantee his return since the UAE does not have an extradition treaty with the U.S.
- In response, lawyers for CZ argued that the former CEO demonstrated he did not pose a flight risk by voluntarily coming to the U.S. to accept responsibility for his actions, seeking denial of the prosecutors' appeal.
- However, Judge Jones has ordered CZ to stay in the U.S. while he is reviewing the prosecutors' appeal and its reasons.
- Zhao currently faces up to 10 years in prison, though he is expected to get no more than 18 months under a settlement agreement.
Zoom Out: - CZ recently stepped down from the CEO position after pleading guilty to violating anti-money laundering requirements and U.S. sanctions by allowing terrorist groups to make crypto transactions on Binance.
- As part of the plea deal, the former CEO was ordered to pay a $50M penalty and prohibited from engaging in Binance's management for three years.
- Zhao was later released on a $175M bond and allowed to return to his home in the UAE while waiting for sentencing.
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What the numbers say: Leading U.S. crypto exchange Coinbase's shares (COIN) recently hit an 18-month high. The shares' value surpassed the $116 mark on Nov. 24 for the first time since May 2022. The figure also represents a 50% increase from the $77 level at the beginning of this November. However, COIN is still 66% below its all-time high of nearly $350 in 2021. Relevance: The 18-month high seen in the COIN shares came within the same week rival crypto exchange Binance was fined $4.3B by U.S. regulators. Several days before COIN's value reached as much as $116.94, Binance was charged with three counts, including money laundering, unlicensed money-transmitting business operations, and sanction violations, after admitting that it allowed crypto transactions on its platform with terrorist groups. As part of a settlement deal with the regulators, the exchange agreed to pay $4.3B, one of the largest-ever corporate penalties in U.S. history. Under the same deal, Binance co-founder Changpeng Zhao (CZ) also stepped down from his CEO role, agreed to pay a $50M penalty, and was ordered not to engage in the company's management for three years. Coinbase's stocks reacted positively to the troubles at the rival exchange, hitting a one-and-a-half-year high. Brands that should care: The regulatory challenges Binance faces are also expected to create an increase in market shares of other leading crypto exchanges, such as Gemini, OKX, Bybit, and Kraken, paving the way for risk perception in investors toward Binance, the largest crypto exchange by trading volume. | | | |
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| 3 | | Stablecoin issuer Circle has partnered with Japanese financial services giant SBI Holdings to boost the circulation of its stablecoin, USD Coin (USDC), in Japan. The collaboration will see the two firms jointly establishing a banking relationship around stablecoins and promoting the use of Web3 services in the Asian country. More: - As part of the partnership, one of SBI Holdings' units, SBI Shinsei Bank Ltd., will offer banking services to Circle, allowing Japanese customers to access USDC and its liquidity.
- Circle CEO Jeremy Allaire said the partnership is a significant milestone in the firm's expansion plans in Japan and the Asia-Pacific (APAC) region.
- The collaboration between the two firms came nearly five months after Japan put its new Payment Services Act into force, becoming one of the first nations to establish a legal framework for stablecoins.
- The legislation legalizes stablecoins denominated in a legal tender to be issued and used as an electronic payment method.
- The act also authorizes licensed financial institutions, such as licensed banks, registered money transfer agents, and trust companies, to issue stablecoins.
- In July, Allaire announced Circle's plans to issue a stablecoin in Japan, nearly one month after he visited the country.
Zoom Out: - USDC is currently the second-largest stablecoin by market cap behind Tether's USDT.
- Stablecoins refer to cryptocurrencies whose value is pegged to another reference asset, mostly a fiat currency.
- Customers generally use these assets to trade with different cryptocurrencies without converting their funds back into fiat currencies.
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| 4 | | Speaking at a town hall meeting with students in Germany, Christine Lagarde, the president of the European Central Bank (ECB), admitted that her son invested in crypto. During her speech, Lagarde pointed out that the son lost nearly his entire investment in crypto despite her strict warnings. More: - The ECB president added that her son reluctantly accepted she was right when she later had another talk with him about the investment.
- Lagarde underlined that the rate of loss was at around 60% of the investment, though the son did not invest a lot.
- The bank official has two sons in their mid-30s.
- The ECB's chief further pointed out that people are free to invest their money where they want but should not be free to engage in criminal or sanctioned transactions.
Zoom Out: - Lagarde is most famous for her skeptical attitude toward cryptocurrencies, and many times, she has defined them as speculative and worthless tools often used for illicit activities.
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| 5 | | Seychelles-based crypto exchange OKX has announced that it has expanded some of its services to Brazil. The move will allow Brazilian customers to use OKX's crypto trading platform and Web3 wallet. More: - The firm said it is focused on offering crypto trading services with fiat currencies in Brazil, allowing users to convert between Brazilian real and cryptocurrencies.
- OKX Brazil's general manager, Guilherme Sacamone, has stated that the Brazilian market has enormous potential to lead the world in crypto adoption and decentralized finance (DeFi).
- OKX currently has offices in six different locations all around the world and caters to customers across more than 190 countries.
Zoom Out: - The data compiled by Chainalysis this year showed that Brazil is one of the largest crypto markets in Latin America, alongside Argentina and Mexico, and the ninth-largest country in the world in overall crypto adoption.
- Several other crypto exchanges, such as Bybit, Kraken, and Binance, also offer their services to users in Brazil.
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| 6 | | Crypto hedge fund Nine Blocks Capital Management has obtained a license in Dubai, the most populous emirate of the United Arab Emirates (UAE). The license was granted by the region's Virtual Assets Regulatory Authority (VARA) to the firm. More: - The approval has made Nine Blocks Capital Management the first crypto hedge fund to be granted a license by the VARA.
- The firm also announced that it picked Dubai as the location for its global headquarters.
- The company's co-founder, Henri Arslanian, said the VARA has managed to create an ecosystem for the crypto space in Dubai, underlining that many of their counterparties are a one-minute walk away from their office.
Zoom Out: - Several other crypto-related firms, such as Crypto.com, OKX, Bybit, Bitget, and Binance, also received licenses in Dubai.
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| 7 | | Quick Hits: - Competitors are killing your efficiency. Read how Greenhouse gained $85mil in revenue from reps who used Klue over non-Klue users.*
- Spanish football club Atletico Madrid has reportedly started preparing to file a lawsuit against Singapore-based crypto exchange WhaleFin over an unpaid $44M sponsorship fee.
- Crypto exchange Zipmex has suspended all digital asset trading services in Thailand as part of its efforts to comply with the regulatory requirements of the country's Securities and Exchange Commission (SEC).
- Seychelles-based crypto exchange HTX, formerly known as Huobi, has fully restored Bitcoin (BTC) deposit and withdrawal services shortly after suffering from a $30M hack.
- The American Cancer Society (ACS) has partnered with crypto developer platform Gitcoin, stepping into the Web3 space.
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Term of the Day Capital call: An investment firm's right to request a portion or all of the committed capital from a limited partner (LP) at discretion is called a capital call. Question of the Week What perks would convince you to return to the office? Join the conversation |
 | 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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