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Crypto Companies Announce Licenses, Acquisitions, New Products

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BIS Publishes Results of Survey on CBDCs and Cryptocurrencies

Major Exchange Publishes Crypto Market Data in ‘Midyear Review’

DOJ Targets Dark Market; NY AG Announces Crypto Settlement Recovery

SEC Closes Ethereum 2.0 Investigation, Will Not Take Action Against Consensys

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Crypto Companies Announce Licenses, Acquisitions, New Products

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By <a href="https://www.bakerlaw.com/RobertAMusiala">Robert A. Musiala Jr.</a>

According to recent reports, a major Chicago-based digital asset trading desk recently obtained a BitLicense from the New York Department of Financial Services. The license allows the company to engage in virtual currency activities in the state of New York.

Separately, in a recent blog post, U.S. fintech and blockchain development company Ripple announced that it has completed its acquisition of a major digital asset custody provider. According to the blog post, the acquisition “adds a limited purpose trust company regulated by the New York Department of Financial Services to [Ripple’s] license portfolio, which includes nearly 40 money transmitter licenses throughout the U.S. as well as a Major Payment Institution License from the Monetary Authority of Singapore, and a Virtual Asset Service Provider (VASP) registration with the Central Bank of Ireland.”

In another recent development, Tether announced “the official launch of Alloy by Tether, a ground-breaking tethered asset backed by Tether Gold.” According to a press release, Alloy by Tether (aUSD₮) is a token “designed to track the value of one US dollar” and “is over-collateralized by Tether Gold (XAU₮), which means it is supported by real physical gold stored in Switzerland.”

In a final notable item, according to reports, a major Latin American bank, Itaú Unibanco, has recently expanded its bitcoin and ether trading services to all bank customers. Previously the bank reportedly offered the services only to selected clients.

For more information, please refer to the following links:

<a href="https://news.bitcoin.com/cumberland-earns-bitlicense-bolstering-institutional-and-otc-crypto-services/">Cumberland Earns Bitlicense, Bolstering Institutional and OTC Crypto Services</a>

<a href="https://ripple.com/insights/paving-a-compliant-path-forward-ripple-closes-standard-custody-acquisition-and-appoints-jack-mcdonald-as-senior-vice-president-of-stablecoins/">Paving a Compliant Path Forward: Ripple Closes Standard Custody Acquisition and Appoints Jack McDonald as Senior Vice President of Stablecoins</a>

<a href="https://tether.io/news/tether-announces-launch-of-alloy-by-tether-a-new-digital-asset-backed-by-tether-gold/">Tether Announces Launch of Alloy by Tether: A New Digital Asset Backed by Tether Gold</a>

<a href="https://cryptonews.com/news/brazils-largest-bank-expands-bitcoin-and-ether-trading-to-all-customers.htm">Brazil’s Largest Bank Expands Bitcoin and Ether Trading to All Customers</a>

BIS Publishes Results of Survey on CBDCs and Cryptocurrencies

The Bank for International Settlements (BIS) recently published the results of its 2023 survey on central bank digital currencies (CBDCs) and cryptocurrencies. Key findings from the survey include the following:

Ninety-four percent of surveyed central banks are exploring a CBDC.

The likelihood that central banks will issue a wholesale CBDC within the next six years exceeds the likelihood that they will issue a retail CBDC.

Key features being considered for wholesale CBDCs are interoperability and programmability.

Key features being considered for retail CBDCs are holding limits, interoperability, offline options and zero remuneration.

With respect to cryptocurrencies, to date, stablecoins are rarely used for payments outside the crypto ecosystem.

About two out of three responding jurisdictions have or are working on a framework to regulate stablecoins and other cryptoassets.

<a href="https://www.bis.org/publ/bppdf/bispap147.htm">Embracing diversity, advancing together - results of the 2023 BIS survey on central bank digital currencies and crypto</a>

<a href="https://www.bis.org/publ/bppdf/bispap147.pdf">BIS Papers No 147 Embracing diversity, advancing together – results of the 2023 BIS survey on central bank digital currencies and crypto</a>

Major Exchange Publishes Crypto Market Data in ‘Midyear Review’

By <a href="https://www.bakerlaw.com/RobertAMusiala">Robert A. Musiala Jr.</a><a href="https://www.bakerlaw.com/VeronicaReynolds"></a>

A major U.S. cryptocurrency exchange recently published its midyear review, in which it presents “10 charts that cover some key crypto market fundamental and technical trends.” Among its findings, the report analyzes “the growth in total value locked (TVL) normalized by the price appreciation of the native gas token across the top layer-1 (L1) and layer-2 (L2) networks.” The report also “isolate[s] the impacts of the CME futures basis trade on ETF flows, showing that the growth of non-hedged exposure to BTC ETFs has slowed considerably since early April.” The charts published in the report address the following: (1) TVL growth adjusted by native gas token price; (2) Activity Impulse: Total transaction fees vs. active addresses; (3) Breakdown of Ethereum transaction fee spends; (4) Layer-2 value locked has grown throughout 2024; (5) Active BTC supply has been on a downtrend in Q2; (6) Correlation matrix (90 day window); (7) Average daily volumes for crypto majors by month; (8) BTC futures open interest (notional value); (9) ETH futures open interest (notional value); and (10) US spot bitcoin ETF market cap vs. CME bitcoin open interest.

For more information, please refer to the following link:

<a href="https://www.coinbase.com/institutional/research-insights/research/monthly-outlook/monthly-outlook-june-2024">Midyear Review: Crypto Markets in 10 Charts</a>

DOJ Targets Dark Market; NY AG Announces Crypto Settlement Recovery

By <a href="https://www.bakerlaw.com/ChristopherLamb">Christopher Lamb</a>

According to a recent press release issued by the U.S. Department of Justice (DOJ), two men have been charged with operating “Empire Market,” which enables users to “anonymously buy and sell more than $430 million in illegal goods and services around the world” through a dark web marketplace. Empire Market allegedly facilitated approximately “four million transactions between vendors and buyers” between 2018 and 2020. According to the release, “[t]housands of vendors and buyers accessed Empire Market through specialized anonymizing software” to sell illicit goods and services. In connection with the investigation, law enforcement has seized roughly $75 million in cryptocurrency.

According to another recent press release, New York Attorney General Letitia James has “recovered approximately $50 million” for over 230,000 investors who invested in and were defrauded by a prominent U.S. cryptocurrency platform by reaching a settlement. According to the release, the cryptocurrency platform misled investors with its Earn program, and the settlement will provide “all defrauded investors full recovery of the assets they invested in the Earn program but were unable to withdraw when the investment program collapsed.”

<a href="https://www.justice.gov/usao-ndil/pr/owners-empire-market-charged-chicago-operating-430-million-dark-web-marketplace">Owners of “Empire Market” Charged in Chicago With Operating $430 Million Dark Web Marketplace</a>

<a href="https://ag.ny.gov/press-release/2024/attorney-general-james-recovers-50-million-crypto-firm-gemini-defrauded">Attorney General James Recovers $50 Million from Crypto Firm Gemini for Defrauded Investors</a>

SEC Closes Ethereum 2.0 Investigation, Will Not Take Action Against Consensys

According to a recent press release, the U.S. Securities and Exchange Commission (SEC) has concluded its investigation into Ethereum, recently discussed <a href="https://www.theblockchainmonitor.com/blogs/weekly-blockchain-blog-5-6-24/">here</a>. On April 25, Consensys sued the SEC “to defend the Ethereum ecosystem, seeking a court order that would halt the SEC’s investigation,” arguing that the SEC lacked jurisdiction to continue to investigate or regulate. According to the release, Consensys sent a letter on June 7 “asking the SEC to confirm that the ETH ETF approvals in May, which were predicated on ether being a commodity,” would cause the investigation to close. According to the release, the SEC’s Enforcement Division has notified Consensys that the division will be “closing its investigation into Ethereum 2.0 and will not pursue an enforcement action against Consensys.”

<a href="https://consensys.io/blog/sec-closes-ethereum-2-0-investigation-will-not-pursue-ethereum-enforcement">SEC Closes Ethereum 2.0 Investigation, Will Not Pursue Ethereum Enforcement Action</a>

Weekly Blockchain Blog – June 24, 2024