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Your Weekly Dose of Crypto - 09/06/2023

Market Overview

SEC sues biggest and second biggest Crypto Exchanges Binance & Coinbase

The SEC sued the largest crypto exchange in the world, Binance and CEO Changpeng "CZ" Zhao on allegations of violating federal securities laws on Monday 5th of May, unveiling 13 charges, mentioning they offered unregistered securities to the general and also alleges that Binance's staking service violated securities law. BNB’s value has dropped more than 15% since the news. The SEC also alleged that a number of other tokens, including the native coins for the Solana (SOL), Cardano (ADA), Polygon (MATIC), Coti (COTI) and Algorand blockchains (ALGO), Filecoin network (FIL), Cosmos hub (ATOM), Sandbox platform (SAND), Axie infinity (AXS) and Decentraland (MANA) are securities. Data from shows that outflows from Binance across all protocols hit $719 million over a 24-hour period. During the U.S. trading hours, net outflows hit $230 million after the SEC announced its lawsuit against Binance.

The following day of this event, The SEC sued U.S crypto exchange Coinbase (COIN) on allegations of violating federal securities law.

According to the SEC, Coinbase operated as an unregistered broker, exchange and clearing agency simultaneously. The suit named Coinbase, Inc. but did not name founder and CEO Brian Armstrong or any other executive.

Coinbase’s shares ($COIN) closed down 12% Tuesday. Coinbase stock fall 9% on Monday, after the SEC had unveiled charges against rival crypto exchange Binance. Year-to-date COIN is still up over 50%.

Cathie Wood’s Ark Investment Management,the second-largest holder of Coinbase Global stock, doubled down on its investment in the crypto exchange after the SEC sued the only publicly traded crypto exchange sending share prices tumbling. The purchase, the first since May 3, took Ark’s total Coinbase holdings to 11.44 million shares, valuing the position at around $590 million.

Stablecoin Issuer Circle Receives Digital Token License in Singapore

Circle Singapore, an affiliate of Circle Internet Financial, which is the issuer of USDC, the second-largest stablecoin by market cap, announced on Wednesday 7th, that it has now received its Major Payment Institution (MPI) license for digital payment token services in Singapore.

The license issued by the Monetary Authority of Singapore (MAS) allows Circle Singapore to offer digital payment token services, cross-border money transfer services and domestic money transfer services in the city-state.

Two months prior Circle Internet Financial was dealt a crippling blow after it admitted to having $3.3 billion of uninsured deposits frozen in Silicon Valley Bank. It amounted to more than 7% of the $42 billion aggregatesupply of its USD Coin (USDC), and since the deposits served as collateral for the crypto, panic caused the trading price of its flagship stablecoin to fall to as low as 88 cents over a two-day period. USDC have fallen from $43 billion to $29 billion while rival Tether USDT has set a new all-time high above $83 billion from $71.8 billion before the SVB failure. Jeremy Allaire , CEO of Circle , is confident his company will gain a competitive edge once a clear reulatory framework is established in the US.

Source: Forbes

El Salvador’s Bitcoin miner "Volcano Energy" launches with $250M investment

A public-private partnership in El Salvador pledging to pump $1 billion into creating a Bitcoin mining farm, has received its first $250 million. According to Volcano Energy, the park is a pioneering example of Bitcoin mining driven by renewable energy, reflecting the industry’s constant innovation and growth in a competitive landscape:

Graph of the Week:

NFT Markets NFT Markets by Matthew Linares, Senior Analyst

Companies Continue to Integrate NFT Technology

Louis Vuitton “Soul-Bound Collectible” ! Louis Vuitton is getting further into the NFT . After "Louis The Game", which aimed to educate players about the brand’s history through interactive gameplay , the luxury brand launched a limited edition NFT collection, with each piece in the “Treasure Trunk” collection priced at €39,000 ($41,693). The NFT launch is part of a new project called “Via”, the Latin word for road, which nods to its aim to act as an elite pathway towards products , both #physical and #digital, and experiences that are inaccessible to others. The brand sees Via as a new chapter, which extends to #traceability (as seen in the LV Diamonds collection, which uses the Aura Blockchain Consortium, and event-focused NFTs that cultivate and reward communities of NFT holders. After connecting their crypto wallets and providing personal details, selected registrants will have the opportunity to explore Via on a private webpage from June 14. From June 16, they can purchase their Via Treasure Trunk using crypto or fiat currency. Participants will soon after receive a specially crafted physical replica of their trunk. Louis Vuitton has some strict rules in place to prohibit holders from selling or transferring the Via trunks. “Soul-bound collectible” or non-transferrable NFTs — often called soulbound tokens — encourage loyaltyand prevent quick reselling. Since its conception in 1858, the brand has continually reimagined the trunk’s trademark heritage design, from the Ernest Hemingway Library Trunk through to Supreme’s streetwear-inspired lens. Now, it’s having a digital upgrade. A new way of taking their rich and longstanding legacies to Web3.

Meanwhile, Warner Bros. Home Entertainment is betting on the future of entertainment with its second installment in the “WB Movieverse”, this time featuring 1978’s “Superman: The Movie”. The studio is set to release a Superman Web3 Movie Experience, a multimedia NFT bundle, including the film in 4K Ultra HD format, image galleries, and artist renderings by notable DC artists. The Superman NFTs will be priced slightly cheaper than the Louis Vuitton NFTs at $30 for the Standard Edition and $100 for the Premium Edition according to NFTEvening. Warner Bros. aims to establish a new home-entertainment business model based on NFTs and build an engaged community of fans.

These exciting developments underscore the increasing interest of Web2 companies in the NFT space. By creating their own collections, these companies not only offer novel experiences to their customer base but also leverage the unique properties of NFTs, such as verifiable digital ownership and the ability to monetize digital assets. As more traditional businesses explore and embrace NFTs, we are witnessing an exciting shift towards the convergence of Web2 and Web3 technologies, offering consumers enhanced and personalized experiences that were previously unthinkable.

Lastest News: Curated by Sam Eisner, Associate

  • Nike Virtual Studios unveiled a partnership with EA Sports to enable customized Nike virtual apparel to be used in EA SPORTS games.

  • The Beijing Municipal Science and Technology Commission has released a white paper in a bid to foster innovation and development within the Web3 industry. The commission aims to establish Beijing as a global innovation hub by allocating a minimum of CNY100m ($14m) annually until 2025.

  • Voltage, a Bitcoin Lightning infrastructure provider, has partnered with Google Cloud to increase its hosting capacity and locations globally.

  • Platinium Group, the leading ticket issuer for Formula 1, is releasing non-fungible token (NFT) race tickets – starting with the Monaco Grand Prix. Platinium Group has teamed up with blockchain infrastructure company Elemint and Web3 agency Bary to help create, mint and sell the NFT tickets.

Regulatory Roundup:

  • The U.S. Commodity Futures Trading Commission (CFTC) has proposed an overhaul of its rules for risk management, and Commissioner Christy Goldsmith Romero said the changes should insist firms prepare themselves for crypto volatility and the risks from holding customers’ digital assets.

  • Hong Kong rolled out new rules on Thursday to guide the cryptocurrency industry in the Chinese special administrative region. Crypto exchanges operating in the jurisdiction are now required to get licensed to offer their services to retail traders. Already, Hong Kong’s financial regulator has received several applications.

  • EU officials have signed the Markets in Crypto-Assets law (MiCA), which aims to create a consistent regulatory framework for crypto assets among the EU member states, into law following final approval from finance ministers. After the signing ceremony, the framework is expected to go into effect following publication in the Official Journal of the European Union, with many of MiCA’s regulations on crypto firms likely starting sometime in 2024.

  • The revised Payment Services Act was promulgated at midnight on June 1, 2023, and now allows Japanese firms to issue stablecoins. Under the terms of the act, all token-issuing firms must be able to prove they have the underlying assets that back their coins, and only regulated banks, fund transfer service providers, trust companies, and other financial industry firms can issue these coins.

  • A group of U.K. lawmakers is calling on the government to introduce crypto financial services regulations sooner rather than later and to appoint a dedicated official to oversee the process. In a report published Monday, the Crypto and Digital Assets All Parliamentary Group (APPG) said cryptocurrency is here to stay and needs immediate regulation. The group, which includes lawmakers from different political parties and both houses of parliament, made 53 recommendations for regulating crypto in the country.

*PLEASE SEE IMPORTANT DISCLOSURES BELOW* Best, Criptonite's Team DISCLOSURE: The opinions expressed herein are those of the author alone and do not represent Wave Digital Assets LLC or any of its affiliates. The author may hold investment positions in some of the assets discussed. Nothing in this email or linked information should be interpreted as an offer or recommendation to buy, sell or hold any security or other financial product. Wave is federally regulated by the US Securities & Exchange Commission as an investment adviser. Registration with a federal or state authority does not imply a certain level of skill or training. Additional information including important disclosures about Wave Digital Assets LLC also is available on the SEC’s website at

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