Alpaca Finance Institutional Newsletter #24
Highlights:
- Increased pressure on banks to cut ties with crypto
- Kraken, the first US exchange to wind down staking due to SEC
With some dubbing the move “Operation Choke Point 2.0,” this week saw 2 major pushes from US regulators in the form of banking restrictions and increased pressure on onshore staking services. Kraken, one of the largest exchanges in the US and Europe, reached a $30M settlement with the SEC and agreed to wind down its staking services. The SEC cited the lack of registration of the product and proper disclosures as a risk to retail investors considering the “outsized” returns. However, industry pundits have argued that the SEC’s lack of clarity on how to register correctly makes compliance near impossible, throwing this enforcement into question.
Meanwhile, decentralized stalking services such as Lido saw increased interest as speculation surrounded future capital possibly coming to the services once the Shanghai upgrade unlocks staked ETH, and Kraken services are forced to shut down.
More troublesome for anyone watching the development of CBDCs and ongoing stablecoin regulation was the increased pressure on US banks to separate themselves from crypto firms and restrict services. This would leave many with limited or no ways to offboard into the traditional banking system. Binance was the first major exchange to confirm the suspicions as they announced they will no longer support US dollar transfers or withdrawals, following operational issues with their partner Signature Bank. Many in the crypto industry are questioning the wisdom behind these recent moves from US regulators , arguing they may have the adverse effect of driving business to more friendly jurisdictions or to decentralized options.
News
- Banks under pressure from U.S. authorities to cut ties with crypto firms
- Robinhood board gives nod to buy Sam Bankman-Fried’s $578M stake
- CoinGecko and 21Shares propose global crypto classification standard
- Former Coinbase product manager pleads guilty in insider trading case
Regulation
- Stablecoin issuer Paxos reportedly probed by New York regulators
- Kraken reaches $30M settlement with SEC over staking as IRS seeks user information
- US financial regulators warn against crypto exposure in retirement accounts
- Hong Kong securities regulator adds crypto personnel for industry supervision
Products
- 3AC and CoinFLEX launch website, waitlist for crypto claims exchange
- German DekaBank plans to launch tokenization platform by 2024
- Saudi Arabia partners with The Sandbox for future metaverse plans
- Nokia uses the metaverse to connect remote breweries, train aircraft techs
Funding
- Coincover secures $30M in funding to strengthen digital asset security
- Crypto lender Salt makes comeback with $64.4 million funding
- UK blockchain carbon offset platform raises $45M in seed funding
- The Web3 community responds to Turkish–Syrian earthquake tragedy
