SEC

SEC Asked Coinbase to Stop Trading All Coins Besides Bitcoin

The scoop: On June 6, 2023, the United States Securities & Exchange Commission (SEC) sued Coinbase for violating federal securities laws. Before opening the case, the SEC requested from Coinbase to stop trading all coins besides Bitcoin (BTC), claiming that all other coins were securities.

Coinbase CEO Brian Armstrong Explains: “They came back to us, and they said . . . we believe every asset other than bitcoin is a security. And, we said, well how are you coming to that conclusion, because that’s not our interpretation of the law. And they said, we’re not going to explain it to you, you need to delist every asset other than bitcoin.”

Why It Matters: For years, there’s been a debate in the crypto community regarding which coins are securities. Many have claimed Bitcoin is the only coin which isn’t a security. Many others have claimed Ethereum also belongs in the same category as Bitcoin. There is much less clarity with other coins. If the SEC’s stance against Coinbase is true and lasts, it would have long-lasting effects on the industry, especially if stablecoins are also deemed securities in the US.

Gensler: SEC Chairman Gary Gensler has previously stated that Bitcoin is the only coin which is not a security. This matches what the SEC said to Coinbase. However, there does seem to be differing opinions from inside the SEC.

WHAT WE'RE WATCHING

🙌 1-yr HODL wave drops from 69.2% to 68.5%. The amount of Bitcoins that have not been moved on the network in more than 1-year hit an all-time high of 69.2%, but recently fell to 68.5%.

The fall can be seen in the dipping of the red line below. While this could cause concern if a large holder were to sell coins, it is more likely to be a large exchange moving around its customers balances.

📈 TD Cowen Publishes Bullish Report on Bitcoin And MicroStrategy. Investment bank TD Cowen released a report on MicroStrategy's Bitcoin adoption and Bitcoin’s future growth potential.

The report highlights Bitcoin's potential as a superior store of value and considers MicroStrategy an attractive investment for exposure to BTC. The bank predicts significant catalysts for Bitcoin's price rise, including SEC approval of a spot Bitcoin ETF, Lightning Network development, accounting changes, and the upcoming halving.

The report suggests that if Bitcoin were to surpass gold stocks, its price could reach $800,000 in 2023 terms. Short-term scenarios range from $70,000 to $15,000, depending on adoption and regulatory factors.

𓅪 Elon Musk Plans to Turn X.com Into More than Social Media. Elon Musk last week rebranded Twitter into X.com. Musk plans to turn X into more than just a social media app. According to Musk, X will become Twitter + Substack + YouTube + PayPal + Amazon + TikTok + WeChat + Baidu — all rolled into one platform called X.

LAW

US House Committee Passes 'Keep Your Coins Act'

In short: The U.S. House Committee on Financial Services passed the Keep Your Coins Act of 2023, introduced by Congressman Warren Davidson, aiming to protect the self-custody of cryptocurrencies and uphold individual financial freedom.

Quote from Congressman Warren Davidson: “Those attacking self-custody oppose individual freedom. They want someone they control to control your assets,” said Congressman Warren Davidson, emphasizing the importance of protecting self-custody in the crypto space.

The facts: 

• The Keep Your Coins Act of 2023 (H.R. 4841) advances in the U.S. House Committee on Financial Services.

• The bill ensures consumers' right to maintain custody of their digital assets in self-hosted wallets.

• Federal agencies would be prohibited from restricting the use of cryptocurrencies for personal transactions and self-custody.

Why it Matters: Self-custody is key to maintaining Bitcoin’s decentralization. Additional protection for users wishing to run nodes and hold their own funds is a step in the right direction for Bitcoin in the USA.

POLL

IN THE LOOP

🤝 Adopting Bitcoin has announced its new conference, Adopting Bitcoin 2024. The conference will take place in Cape Town, South Africa from January 26-28, 2024.

⛏️ Sazmining has launched a new Bitcoin mining facility in Paraguay. The company is looking to take advantage of the country’s cheap electricity compared to North American electricity rates.

🏛️ US Congressman Patrick McHenry claims Bitcoin is a “financial revolution”. The congressman has been outspoken about his support for Bitcoin and the need to create a positive environment for Bitcoin & crypto in the USA.

Today’s newsletter was written by Jordan and edited by Colin.