July 17th ,2023 — 🚨XRP not a security!
Get an overview of crypto market liquidity from July 11th to July 17th, 2023.
Top crypto market headlines:
- Kraken, Crypto.com Join Coinbase in Relisting XRP After Court Ruling — 7/14/23
- SEC, Ripple receive mixed ruling on XRP status as security with trial now possible — 7/13/23
- Europe’s first spot Bitcoin ETF eyes 2023 debut after year-long delay — 7/13/23
- Elon Musk launches xAI in challenge to dominance of ChatGPT owner — 7/12/23
- Google Play changes policy toward blockchain-based apps, opening door to tokenized digital assets, NFTs — 7/12/23
- Inflation rose just 0.2% in June, less than expected as consumers get a break from price increases — 7/12/23
- ‘Blockchain-enabled’ WisdomTree consumer app goes live in 21 states — 7/12/23
- BlackRock’s Bitcoin ETF Application Takes Surveillance to the Next Level — 7/11/23
- Vanguard Now Owns $560 Million Worth of Bitcoin Mining Stocks — 7/10/23
Weekly Insights Report:
It was December 2020 when the SEC first sued Ripple and its two founders for allegedly raising $1.3 bn illegally through an unregistered security offering. Last week, a US federal judge ruled that Ripple’s token, XRP, does not constitute a security. “XRP, as a digital token, is not in and of itself a “contract, transaction, or scheme” that embodies the Howey requirements of an investment contract,” the ruling said. However, the victory is only partial for Ripple as ~$730 million in direct sales of XRP to institutional investors was deemed by the judge to be an unregistered security offering for passing all three prongs of the Howey test. The court also ruled that Ripple’s use of $609 million in XRP as compensation for employees and other third parties, as well as sales of XRP by Ripple’s CEO and co-founder, failed the first prong of the Howey Test that there be an “investment of money.”
While this is a giant regulatory leap for both Ripple and the broader crypto ecosystem, one should keep in mind that an appeal is still possible, but most importantly that the rulings in this case by this specific judge apply only to XRP’s case, with any transitivity to other tokens subject to further regulatory clarity.
Major centralized exchanges such as Crypto.com and Kraken followed Coinbase in reopening trading of XRP following the ruling, with Gemini also considering a listing. XRP’s trading volumes increased ~20x to more than $11 bn, and its price rose by more than 80% before stabilizing around 55% at the time of writing. XRP is currently the fourth largest crypto by market capitalization ($39 bn), following BTC, ETH and USDT. Way to go Ripple team!
Europe’s first spot Bitcoin ETF by the London-based Jacobi AM is set to launch later this year on the Euronext Amsterdam exchange. This is a significant shift from Europe’s typical exchange-traded notes, as ETF shareholders own a portion of the underlying assets.
Polygon intends to overhaul the tokenomics of its current MATIC token, replacing it with a new POL token. This “productive token” would benefit validators securing multiple chains. Users will be given four years to swap their MATIC tokens to POL via a specialized smart contract. The proposed initial supply cap for POL is set at 10 billion, with a 1% annual emission rate over a decade.
In other news, according to the WSJ, Binance has let go of over 1000 employees in recent weeks, with a possibility of further layoffs, potentially affecting more than a third of the company’s staff. Cross-chain bridge protocol Multichain ceased operations due to the detention of its CEO Zhaojun and his sister. Multichain saw $125 million stolen on July 6, with blockchain security firm Chainalysis pointing to possible rug pull by insiders. The US Attorney, with the support of the FBI, SEC, and CFTC charged Celsius founder and CEO Alex Mashinsky with orchestrating a scheme to defraud customers of Celsius through a series of false claims about the fundamental safety and security of the Celsius platform
On a weekly basis, BTC is up by 0.2% and ETH is up by 3%.
As usual, we look at the liquidity and trading patterns of BTC and ETH of last week, including bid-ask spreads and fragmentation index and take it a step further with a detailed report on market anomalies. Check out full reports:
Join us at ETHCC!
We are at EthCC in Paris this week. Don’t hesitate to get in touch directly with Vincent and Chadi
We are at EthCC in Paris this week. Don’t hesitate to get in touch directly with Vincent and Chadi
Other major crypto headlines:
- Multichain ceases operations as CEO’s sister is detained in China while holding $220 million of funds — 7/14/23
- Binance Lays Off Over 1,000 Employees — 7/14/23
- Hedge Funds’ Long-Term Crypto Interest Remains Robust Even as Proportion Investing Drops: PwC — 7/13/23
- Polygon proposes upgrading MATIC tokens to become POL — 7/13/23
- Celsius and Alex Mashinsky face slew of criminal, regulatory allegations — 7/13/23
- Snoop Dogg and a16z Back Web3 Music Platform Sound’s $20M Funding Round — 7/12/23
- Singapore wealth fund Temasek to cease crypto industry investments — 7/12/23
- Coinbase Goes to Court Against the SEC — 7/11/23
- Cboe reaches surveillance agreement with Coinbase for spot bitcoin ETFs — 7/11/23
- The Corporate Bankruptcy Wave Will Get Even Uglier — 7/11/23
And in case you haven’t seen, here is a selection of our latest articles:
- Market Making Overview: TradFi vs Crypto NEW!
- Commentary notes on Credit Suisse’s rescue deal and recent banking turmoils (2/2)
- Commentary notes on SVB’s failure, Credit Suisse, implications for crypto, and where do we go from here (1/2)
- The Future of Trustless and Decentralized Cross-Chain DeFi — Focus on Interlay
- On Blockchain Interoperability — Focus On The Polkadot Ecosystem
- FTX Post-Mortem Analysis — Why Transparency Matters?
