• The SEC has filed a motion to deny Coinbase’s request for additional documents, including emails from SEC Chair Gary Gensler
• The SEC argues that Coinbase’s document requests are overly broad and disproportionate to the needs of the case
• The agency claims it has already provided over 240,000 documents and says processing an additional 3 million documents would be burdensome
• Coinbase argues the documents are necessary to show the SEC’s inconsistent views on digital assets and regulatory reach
• The legal battle stems from the SEC’s June 2023 lawsuit against Coinbase for allegedly operating as an unregistered securities exchange

The U.S. Securities and Exchange Commission (SEC) has filed a motion to deny Coinbase’s request for additional documents in their ongoing legal dispute, arguing that the cryptocurrency exchange’s demands are overly broad and disproportionate to the needs of the case.

In a court filing on August 5, 2024, the SEC pushed back against Coinbase’s efforts to subpoena emails from SEC Chair Gary Gensler and obtain what the agency describes as “essentially all documents that in any way relate to crypto assets.”

The regulator claims that Coinbase’s request for further documents and evidence is “disproportional” to the case’s requirements and lacks legal precedent.

The SEC stated that it has already produced over 240,000 documents relevant to Coinbase and is in the process of searching another 117,000 documents for responsive material. The agency argues that complying with Coinbase’s additional requests would require processing approximately three million more documents, a task it deems excessively burdensome and time-consuming.

“The burden of searching and producing or logging, one by one, an additional three million irrelevant external or assuredly privileged internal SEC documents that Coinbase’s limitless request entails is thus entirely disproportional to the needs of the case,”
the SEC wrote in its court filing.

The regulator contends that many of these additional documents would likely be subject to privilege claims, necessitating a manual review process that would far exceed the 400 hours the SEC claims it has already spent on document production for this case.

Coinbase, however, maintains that these documents are crucial to its defense. Paul Grewal, Coinbase’s Chief Legal Officer, argued in a post on social media platform X that the requested documents are necessary to demonstrate “the record of the SEC’s inconsistent views of digital assets and its own regulatory reach.”

The exchange believes that the SEC’s internal discussions and communications with market participants could reveal a lack of clarity in the agency’s guidelines on what constitutes a security in the cryptocurrency context.

“If the SEC is going to engage in an unprecedented regulation by enforcement campaign, the least they owe to those they target – and the public – is transparency,” Grewal stated.

Update: Today @SECGov filed its response to our request to produce important documents showing the record of the SEC’s inconsistent views of digital assets and its own regulatory reach. If the SEC is going to engage in an unprecedented regulation by enforcement campaign, the… https://t.co/MxQ1omDGN3

— paulgrewal.eth (@iampaulgrewal) August 5, 2024

The legal battle between the SEC and Coinbase began in June 2023 when the regulator sued the exchange, alleging that it operates an unregistered securities exchange, broker, and clearing agency. The SEC identified 13 crypto assets that it deemed securities, claiming that Coinbase had been operating as an “unregistered securities broker” since 2019.

Coinbase has consistently argued that the SEC is overstepping its regulatory authority and has failed to provide clear guidelines on what constitutes a security in the cryptocurrency space. The exchange claims that the documents it seeks will demonstrate this lack of clarity and the SEC’s inconsistent approach to regulating digital assets.

Despite Coinbase’s arguments, the company has faced setbacks in its document requests. In early July, a U.S. judge stated that Coinbase’s justifications for the subpoena were unimpressive, noting that the company’s “reservoir of credibility” had been drained.

Nevertheless, Coinbase has continued to push for access to these documents, considering them a “critical” part of its defense strategy.

As the legal battle continues, both parties remain steadfast in their positions. The SEC maintains that it has “more than satisfied its discovery obligations,” while Coinbase insists on the necessity of greater transparency from the regulator.

The post Coinbase and SEC Clash Over Scope of Document Discovery in Crypto Regulation Case appeared first on Blockonomi.

• Bybit announced it will withdraw from the French market, citing “regulatory developments”
• From August 13, French users will only be able to withdraw funds, with all positions automatically liquidated if not closed by then
• The French financial regulator AMF had previously warned citizens that Bybit was operating without proper registration as a digital asset service provider
• Bybit’s exit follows the implementation of Europe’s Markets in Crypto-Assets (MiCA) regulation
• Despite restrictions in key markets, Bybit has grown to become the second-largest exchange by trading volume globally

Cryptocurrency exchange Bybit announced on August 1, 2024, that it will cease operations in France, citing “recent regulatory developments” as the primary reason for its withdrawal. This move comes in the wake of increased scrutiny from French financial regulators and the implementation of new European Union crypto legislation.

Starting August 2, French users will face restrictions on their Bybit accounts, including the inability to open new positions or purchase any products.

By August 13, all unclosed positions will be automatically liquidated, and users will only be able to withdraw their remaining funds. Bybit has stated that it looks forward to returning to the French market in the future, once it has secured the appropriate licenses under French law.

The exchange’s troubles in France are not new. In May 2024, the Autorité des Marchés Financiers (AMF), France’s financial regulator, issued a warning to French citizens that Bybit was operating without proper registration as a Digital Asset Service Provider (DASP). The AMF had previously blacklisted Bybit in 2022 for non-compliance with French regulations.

Bybit’s exit from France is part of a broader trend of cryptocurrency exchanges adapting to evolving regulatory landscapes. The move follows the implementation of the European Union’s Markets in Crypto-Assets (MiCA) regulation, which sets guidelines for crypto providers and stablecoin issuers.

While some provisions of MiCA took effect in June 2024, the remaining rules for cryptocurrencies and service providers will be implemented starting December 30, 2024.

The regulatory pressure in France is not unique to Bybit. Other major exchanges, including Binance, have faced scrutiny from French authorities. In December 2023, the AMF forced Binance’s founder, Changpeng Zhao, to relinquish ownership of Binance France to comply with U.S. sanctions.

Despite these regulatory challenges, Bybit has managed to grow significantly in the global cryptocurrency market. As of August 2024, it stands as the second-largest exchange by trading volume, according to data from CoinGecko. The exchange processed more than $5.5 billion in trading volume on August 1, second only to Binance’s $11.4 billion.

However, Bybit’s growth has been accompanied by a series of market exits. In addition to France, the exchange has previously withdrawn from markets in Canada and the United Kingdom due to tightening regulations. Bybit’s website currently lists the United States, the UK, China, Hong Kong, Singapore, and Canada among the jurisdictions where it no longer operates.

For French users of Bybit, the exchange’s exit means they will need to find alternative platforms for their cryptocurrency trading activities.

The post Au Revoir: Bybit Exits French Market Amid Regulatory Pressures appeared first on Blockonomi.

• BitClout founder Nader Al-Naji has been charged with wire fraud and selling unregistered securities by the SEC and DOJ.
• Al-Naji allegedly raised $257 million from token sales but spent $7 million on personal expenses.
• The SEC claims Al-Naji misled investors about BitClout’s decentralized nature to avoid regulation.
• BitClout was controversial for creating profiles of celebrities without permission.
• Major venture capital firms like Sequoia and Andreessen Horowitz had invested in BitClout.

Nader Al-Naji, the founder of crypto social media platform BitClout, is facing legal trouble. On July 30, 2024, the U.S. Securities and Exchange Commission (SEC) and Department of Justice (DOJ) charged Al-Naji with wire fraud and selling unregistered securities.

According to the SEC, Al-Naji raised about $257 million by selling BitClout’s native token, BTCLT. He allegedly told investors this money would pay for BitClout employees. However, the SEC claims Al-Naji spent over $7 million on personal items. These included renting a mansion in Beverly Hills and giving large cash gifts to family members.

Al-Naji was arrested on Saturday, July 27, and appeared before a judge in California on Monday. The DOJ has charged him with one count of wire fraud, which could lead to up to 20 years in prison if he’s found guilty.

The SEC says Al-Naji tried to make BitClout seem like a decentralized project with “no company behind it…just coins and code.” He used the online name “Diamondhands” to hide his identity. The SEC also claims Al-Naji got a letter from a law firm saying BTCLT tokens were likely not securities. But this letter was based on information that Al-Naji had misrepresented, according to the SEC.

Gurbir S. Grewal, Director of the SEC’s Enforcement Division, said, “Al-Naji attempted to evade the federal securities laws and defraud the investing public, mistakenly believing that ‘being fake decentralized generally confuses regulators and deters them from going after you.'”

BitClout launched in early 2021 as a blockchain-based social media platform. It quickly became controversial for creating profiles of celebrities without their permission. The project copied information from Twitter profiles onto the BitClout site.

This led to legal issues. A law firm sent Al-Naji a letter demanding BitClout stop using people’s identities without permission. Even Lee Hsien Loong, the former Prime Minister of Singapore, asked for his BitClout profile to be removed.

Despite these problems, BitClout had backing from major investors. According to Al-Naji, these included well-known firms like Sequoia, Andreessen Horowitz, Coinbase Ventures, and others. Sources say Sequoia invested $1 million and Andreessen Horowitz invested $3 million in an early funding round.

Many investors were willing to support Al-Naji because of his previous company, Basis. In 2018, Basis raised $140 million to create a stablecoin. But Al-Naji ended up returning most of the money when he realized regulations would make it hard to continue.

When Al-Naji approached investors with the idea for BitClout in early 2021, he presented it as a broad concept for decentralized social media. The controversial “social stock market” feature, where users could buy and sell tokens tied to people’s reputations, was not the main focus at first.

Some tech industry figures defended BitClout after its launch. Investors like Andrew Chen from Andreessen Horowitz and others bought tokens on the platform. Shaun Maguire from Sequoia Capital called BitClout “instantly electrifying” in a post.

The SEC’s complaint also names Al-Naji’s wife, mother, and related business entities as relief defendants. This is because they allegedly received some of the investor funds from Al-Naji.

Al-Naji has not yet responded to requests for comment on the charges. In late 2021, he expressed confidence in BitClout’s legal position, saying he had learned a lot about crypto regulations from his previous company.

The post Where Did $257 Million Go? BitClout Founder Faces Fraud Charges from SEC and DOJ appeared first on Blockonomi.

Countries facing U.S. sanctions have increasingly turned to cryptocurrencies to circumvent restrictions. And why not – they can be used all over the world no matter what!

“We have difficulties with calculations because the official currency in El Salvador is the US dollar. As an alternative, El Salvador offers to use cryptocurrency in trade operations,” Ilyukhin stated.

Bitcoin Works Anywhere

El Salvador has maintained a neutral stance regarding the Russia-Ukraine conflict. The Latin American country has neither condemned Russia nor joined sanctions, despite pressure from Western nations and regular diplomatic visits from Ukraine.

But for Bitcoin, El Salvador’s stance is clear. The country went down in history as the world’s first nation to adopt Bitcoin as legal tender. The administration of President Nayib Bukele, a known Bitcoin advocate, continues to promote Bitcoin adoption as part of its broader economic strategy.

The latest proposal shows El Salvador’s ongoing commitment to its pro-crypto stance. Arkham’s data shows that as of July 29, El Salvador had over 5,800 Bitcoin, valued at around $384 million. The country has consistently acquired BTC as part of Bukele’s Bitcoin plan.

El Salvador has recently drafted a reform proposal to create a private investment bank called the Bank for Private Investment (BPI). The bank would be authorized to conduct operations in both Bitcoin and U.S. dollars, allowing it to provide financial services to Bitcoin investors.

Despite El Salvador’s enthusiasm, the proposal faces hurdles since Russia has prohibited the use of cryptocurrencies for payments. The ban has been broadened to include security tokens, utility tokens, and non-fungible tokens (NFTs) as forms of payment.

“Bitcoin is not widespread in our country, so we are looking for other ways to strengthen trade. The government of El Salvador is ready to continue economic cooperation with Russia,” said Ilyukhin.

The Central Bank of Russia previously proposed a comprehensive ban on all cryptocurrency operations, including trading and mining, citing systemic financial risks. However, the proposal has not been fully enacted.

The Russian government has since decided to regulate rather than completely ban cryptocurrencies. Earlier this month, the State Duman, the Lower House of the Russian Parliament, passed a bill that legalizes Bitcoin mining and allows using cryptocurrencies for international trade.

The bill seeks to establish a regulatory framework to oversee crypto mining activities, ensure compliance with tax regulations, and prevent illicit operations. If approved by the Federation Council, the Upper House, and the President, it will come into effect later this year.

El Salvador May Apply to Become a BRICS Member

El Salvador officially accepts Bitcoin as a means of payment and is open to adopting cryptocurrency for trade with Russia. However, there are challenges due to the reliance on the US dollar and intermediary banks.

Ilyukhin said that the U.S. has proposed a “Marshall Plan” for Latin America to strengthen its regional influence. Despite this, many Latin American countries, including El Salvador, show interest in cooperating with Russia and potentially joining BRICS.

El Salvador could submit its application to join the BRICS group within the next one to two years. Joining BRICS could provide El Salvador with new economic opportunities and a stronger geopolitical standing, particularly as the group aims to enhance cooperation among emerging economies and challenge Western dominance in global affairs.

Several other countries are also exploring this possibility. The BRICS alliance, originally formed by Brazil, Russia, India, China, and South Africa, has recently welcomed many new member countries, including Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates.

The post El Salvador Suggests Bitcoin For Trade With Russia As Sanctions Bite appeared first on Blockonomi.

• Senator Roger Marshall has withdrawn his support for the Digital Asset Anti-Money Laundering Act (DAAMLA).
• The DAAMLA bill aims to bring the crypto industry under existing anti-money laundering frameworks.
• The bill has faced criticism from crypto advocates and former government officials.
• Senator Elizabeth Warren, who co-sponsored the bill, is running for reelection in 2024.
• The bill classifies various crypto service providers as financial institutions subject to Bank Secrecy Act compliance.

In a surprising turn of events, Republican Senator Roger Marshall has withdrawn his support for the Digital Asset Anti-Money Laundering Act (DAAMLA), a bill he co-sponsored with Democratic Senator Elizabeth Warren in 2022.

This move, recorded on July 24, 2024, marks a significant shift in the political landscape surrounding cryptocurrency regulation in the United States.

The DAAMLA bill, reintroduced to the Senate in July 2023, aims to bring the crypto industry under existing Anti-Money Laundering and Counter-Terrorist Financing frameworks.

It proposes to classify a wide range of crypto service providers, including decentralized wallet providers, validators, and miners, as financial institutions. This classification would subject them to the terms of the Bank Secrecy Act.

Senator Warren, who is running for reelection in 2024 to represent Massachusetts, has been a vocal critic of the crypto industry. When introducing the bill, she claimed that crypto was being used by “rogue nations, oligarchs, drug lords, and human traffickers” to launder money.

However, the bill has faced significant criticism from various quarters. Crypto organizations argue that it exaggerates crypto’s role in funding terrorism and illicit activities.

They warn that the proposed legislation could severely impact the U.S. crypto industry.

1/ Today, we sent a new letter to Congress, supported by a doubled 80+ coalition of former military and national security professionals urging members to reconsider support for proposed legislation that could cripple the domestic digital assets industry.https://t.co/6bSarhpVP4 pic.twitter.com/uxIqyGp1AY

— Blockchain Association (@BlockchainAssn) February 13, 2024

In February 2024, the Chamber of Digital Commerce, a U.S.-based crypto advocacy group, urged the Senate Banking Committee not to consider the DAAMLA bill.

They argued that it could “erase hundreds of billions of dollars in value for U.S. startups and decimate the savings of countless Americans” who had legally invested in crypto.

Adding to the concerns, a group of 80 former military and national security officials from the U.S. government wrote a letter warning lawmakers against supporting the bill.

They suggested that the legislation could drive the majority of the digital asset industry overseas, potentially hindering law enforcement and increasing national security concerns.

Despite these criticisms, the bill still has the support of 18 senators from both parties. It mandates the Financial Crimes Enforcement Network to issue regulations for reporting significant foreign digital asset holdings and seeks to establish compliance measures for financial institutions to mitigate risks associated with anonymity-enhancing technologies.

Senator Marshall’s withdrawal as a co-sponsor is particularly noteworthy given his previous stance on crypto. He has been vocal in his criticism of the asset class, labeling it a “threat to national security.”

In April, Marshall and Warren jointly expressed concerns about the role of stablecoin issuer Tether in potentially facilitating attempts to circumvent U.S. sanctions.

The reasons behind Marshall’s change of heart remain unclear, as his office has not yet commented on the decision.

This development adds another layer of complexity to the ongoing debate about crypto regulation in the U.S., highlighting the evolving nature of political stances on this issue.

The post U.S. Senator Backs Out of Controversial Cryptocurrency Legislation appeared first on Blockonomi.

• Coinbase has added three new members to its board of directors, expanding it from seven to ten members.
• Chris Lehane, a former aide to President Bill Clinton and current OpenAI executive, is one of the new board members.
• Paul Clement, a former U.S. Solicitor General under President George W. Bush, has also joined the board.
• Christa Davies, the former chief financial officer of Aon, is the third new board member.
• These appointments come as Coinbase prepares for potential changes in the regulatory landscape following the November elections.

Coinbase, a leading cryptocurrency exchange, has recently made significant changes to its board of directors. The company has added three new members, increasing the board’s size from seven to ten. These appointments bring a mix of political, legal, and financial expertise to the table.

The first notable addition is Chris Lehane, who currently serves as Vice President of Public Works at OpenAI. Lehane’s background includes working as a political strategist for former President Bill Clinton in the 1990s.

He also played a key role in helping Airbnb become a legal operator across all 50 U.S. states and internationally.

Paul Clement, a former U.S. Solicitor General under President George W. Bush, is the second new board member. Clement has extensive experience in litigation and has argued over 100 cases before the U.S. Supreme Court.

His legal expertise could be valuable for Coinbase, particularly in light of its ongoing legal challenges with the U.S. Securities and Exchange Commission (SEC).

The third new director is Christa Davies, who previously served as the chief financial officer of management consulting firm Aon. Davies also has experience in the tech sector, having worked as chief financial officer for Microsoft’s platforms and services division.

Today we announce that Chris Lehane, Paul Clement, and Christa Davies are joining Coinbase’s Board of Directors.

They each have different political philosophies and career paths but all have arrived at the same conclusion: crypto is a powerful tool to update the system. pic.twitter.com/bQyEtO6thl

— Coinbase (@coinbase) July 25, 2024

These appointments come at a time when Coinbase is preparing for potential changes in the regulatory landscape, especially with the upcoming November elections. The company aims to strengthen its position and navigate the evolving crypto regulatory environment.

Lehane, in particular, is expected to provide strategic counsel to Coinbase’s leadership. He emphasized the importance of bipartisanship in the crypto space, noting that both economic freedom advocates and those focused on economic opportunity can find common ground in digital assets.

The new board members will serve on various committees within Coinbase. Davies and Clement will both join the audit and compliance committee, supporting the company’s financial operations and regulatory compliance efforts.

Coinbase’s Chief Legal Officer, Paul Grewal, praised Lehane as “one of the foremost political and legal strategists of our time.” He highlighted Lehane’s role in bringing attention to crypto’s growing political significance for both major U.S. political parties.

The expanded board reflects Coinbase’s efforts to diversify its leadership and bring in expertise from various sectors. This move could help the company address challenges in the rapidly evolving cryptocurrency industry, including regulatory issues and market volatility.

These high-profile appointments also underscore the growing mainstream acceptance of cryptocurrency and blockchain technology. As the industry continues to mature, companies like Coinbase are increasingly drawing talent from traditional finance, technology, and government sectors.

The new board members have expressed confidence in the potential of digital assets to improve financial inclusion, particularly for marginalized groups. This aligns with Coinbase’s stated mission to increase economic freedom and opportunity through cryptocurrency.

The post Coinbase Expands Board with Three New Directors appeared first on Blockonomi.

• Senator Cynthia Lummis plans to propose a bill for the Federal Reserve to hold Bitcoin as a reserve asset.
• The proposal will be introduced at the Nashville Bitcoin Conference.
• Former President Donald Trump is expected to speak at the conference, with speculation about his potential endorsement.
• The bill aims to strengthen the US dollar and integrate Bitcoin into the US financial system.
• There’s growing support for Bitcoin from Wall Street, including BlackRock CEO Larry Fink.

Wyoming Senator Cynthia Lummis is set to introduce a groundbreaking bill at the upcoming Nashville Bitcoin Conference.

The proposed legislation would require the Federal Reserve to hold Bitcoin as a strategic reserve asset, similar to how it currently holds gold and foreign currencies.

The conference, scheduled for July 25-27, 2024, has drawn attention from both the crypto community and political circles.

Former President Donald Trump is among the high-profile speakers expected to attend. This has led to speculation about whether Trump might endorse Bitcoin as a strategic reserve asset, which could lend significant weight to Lummis’s proposal.

Lummis, known for her pro-crypto stance, has been quietly seeking support from her colleagues on the Senate Banking Committee.

₿ig things are in store this week. Stay tuned!

— Senator Cynthia Lummis (@SenLummis) July 22, 2024

The bill’s exact details are still under wraps, but early drafts suggest it would direct the Federal Reserve to purchase and hold Bitcoin as part of its reserves.

Supporters of the bill argue that it could help strengthen the US dollar. Currently, the dollar is backed by the country’s taxing authority rather than any hard asset. By adding Bitcoin to the mix, proponents believe it could provide additional stability to the currency.

However, the proposal is not without its critics. Some worry about Bitcoin’s volatility and question its suitability as an economic hedge. There are also concerns that adding crypto to the reserves might weaken the value of gold, which plays a key role in the US economy.

The US government already holds a significant amount of Bitcoin, roughly 210,000 tokens valued at over $66,000 each. These holdings primarily come from Department of Justice seizures from illegal activities. Lummis’s bill would formalize and expand this position, potentially signaling a major shift in US financial policy.

The Nashville Bitcoin Conference is shaping up to be a pivotal event for the crypto industry. Besides Lummis and Trump, other notable speakers include MicroStrategy’s Michael Saylor, Ark Invest’s Cathie Wood, and independent presidential candidate Robert F. Kennedy Jr.

Interestingly, Vice President Kamala Harris, the likely Democratic nominee, declined an invitation but is reportedly open to appealing to crypto voters.

The proposed legislation comes at a time when Bitcoin is gaining more mainstream acceptance. Larry Fink, CEO of BlackRock, has recently changed his stance on Bitcoin.

Once calling it an “index of money laundering,” Fink now describes Bitcoin as “digital gold” and a “long-term store of value.” BlackRock’s recent Bitcoin ETF launch has already attracted nearly $19.5 billion in investor funds, indicating growing interest from traditional finance.

If introduced and passed, Lummis’s bill could have far-reaching effects. It might drive up Bitcoin’s value and potentially prompt other nations to consider similar moves. However, the proposal faces significant hurdles under the current administration, which has taken a cautious approach to digital assets.

The fate of this legislation will likely depend on the level of Congressional support it receives and the outcome of the November presidential election. As the Nashville Bitcoin Conference approaches, all eyes will be on Senator Lummis and her groundbreaking proposal.

The post New Bill Aims to Add Bitcoin to US Strategic Reserves appeared first on Blockonomi.

The Mt. Gox hack turned Japan into an early adopter of strict crypto exchange regulations, but there has been some progress in the regulatory approach over the past few years.

At the same time, the platform will undertake necessary changes to comply with Japanese laws, including removing Japanese language text. However, essential information will still be provided in Japanese during the support period to facilitate the transition for Japanese-speaking investors.

More Regulation Everywhere

The reason behind Gate.io’s exodus remains unclear. In its official statement, the exchange said it strived to comply with regulations and regretted having to exit the Japanese market.

“As one of the world’s leading cryptocurrency exchanges, we strive to comply with financial regulations in all regions in which we operate,” Gate.io stated.

While Gate.io claims commitment to regulations, it is not registered with Japan’s Financial Services Agency (FSA). FSA’s previous warnings against other exchanges could be the possible reason for their exit.

The Financial Services Agency (FSA) has issued warning letters to four cryptocurrency exchanges for operating in Japan without proper registration. These include Bybit, MEXC Global, Bitforex, and Bitget.

According to Japan’s financial watchdog, these exchanges have violated the country’s fund settlement laws. The regulator clarified that the current list of unregistered traders may not accurately represent the full scope of unregistered businesses.

Exchanges that do not comply with the FSA’s regulations may face fines and legal action. Bybit, one of the leading cryptocurrency exchanges, has not yet released an official statement on the FSA’s warning.

Gate.io is a cryptocurrency exchange established in late 2017, under the umbrella of Gate Technology. The exchange is certainly not the first and may not be the last to exit from a growing market. Binance has also exited or limited its services in several countries, including the UK, Germany, and Japan, due to regulatory pressures.

Japan has strict consumer protection laws for cryptocurrency exchanges, likely a result of the Mt. Gox hack. Following the collapse of Mt. Gox in 2014, the government established stringent guidelines for cryptocurrency operators, which has contributed to a stable regulatory environment.

Mt. Gox Money In The Market

After a decade, victims of the Mt. Gox hack have finally begun receiving reimbursements. The exchange’s trustee announced the start of the repayment process earlier this month.

While the Japanese authorities are taking steps to ensure proper oversight and mitigate risks associated with crypto-related operations like fraud, money laundering and market manipulation, they are also working to integrate digital assets into their financial system.

The Japanese government is moving closer to allowing venture capital firms and other investment funds to hold digital assets directly.

Bloomberg reported that Prime Minister Fumio Kishida’s administration has pushed for legislative changes to enable investment limited partnerships to acquire and hold crypto assets.

The proposal is part of a broader economic reform bill aimed at fostering new business creation and strategic domestic investment through tax incentives and financial support.

Major Japanese corporations, including Softbank and Sony, are actively entering the Web3 space through strategic investments and partnerships. In addition, Metaplanet, a public company often referred to as ‘Asia’s Microstrategy’ has also increased its Bitcoin holdings, with consistent purchases since earlier this year.

Meanwhile, the rise of non-fungible tokens (NFTs) has also gained traction in Japan, with regulatory guidelines clarifying their status. NFTs are not classified as securities under current laws if they do not confer profit-sharing rights to holders, thus allowing for a more flexible approach to digital art and collectibles.

The post Gate.io Exits Japan, Likely Due to Regulatory Pressure appeared first on Blockonomi.

• Coinbase has filed a motion to compel the SEC to produce documents, including Gary Gensler’s private communications during his time as SEC Chair.
• The company argues these documents are critical for its defense against SEC allegations of operating as an unregistered securities exchange.
• Coinbase is seeking information on SEC conversations with other market participants and documents related to its 2021 public offering.
• The SEC has refused to search for documents outside its Enforcement Division, citing lack of relevance and undue burden.
• This motion is part of Coinbase’s ongoing legal battle with the SEC, which sued the company in June 2023.

Cryptocurrency exchange Coinbase has taken a new step in its legal fight against the U.S. Securities and Exchange Commission (SEC). The company has filed a motion to compel the SEC to produce documents it believes are crucial for its defense.

The motion, filed in the U.S. Southern District Court of New York, asks for several types of documents. These include private communications from SEC Chair Gary Gensler during his time at the SEC, which began in 2021.

Coinbase also wants information about conversations SEC staff had with other market participants, and documents related to Coinbase’s 2021 public offering.

This legal action is part of a larger conflict between Coinbase and the SEC. In June 2023, the SEC sued Coinbase. The regulator accused the company of operating as an unregistered securities exchange since 2019.

The SEC also claimed that Coinbase allowed illegal trading of unregistered securities on its platform.

Coinbase argues that the requested documents are important for its defense. The company believes these materials could show that the SEC didn’t previously consider Coinbase’s operations to be breaking securities laws. Coinbase also thinks the documents could support its claim that it didn’t receive fair warning about any violations.

Paul Grewal, Coinbase’s chief legal officer, explained the company’s position on social media. He said, “We’re entitled to know all the cards the other side has.” Grewal added that Coinbase isn’t trying to play “Texas Hold ‘Em with all the cards face down.”

Today we are asking the Court to order @SECGov to produce important documents in discovery, including documents related to the tokens the SEC included in its complaint against @coinbase, the SEC’s consideration of our public offering, and statements Chair Gensler has made in his…

— paulgrewal.eth (@iampaulgrewal) July 23, 2024

However, the SEC has pushed back against these requests. The regulator says it won’t search for documents outside of its Enforcement Division’s investigative files. The SEC claims these other documents aren’t relevant and that searching for them would be too much work.

Coinbase disagrees with the SEC’s stance. In its motion, the company called the SEC’s position “untenable.” Coinbase wants the court to make the SEC do thorough searches and either produce the requested documents or explain why they can’t be shared.

This latest move by Coinbase is a narrowed version of an earlier request. In April, the company had asked for Gensler’s private communications from before he became SEC Chair. After some pushback, Coinbase has now limited its request to Gensler’s communications during his time as Chair.

The conflict between Coinbase and the SEC is part of a broader debate about how cryptocurrencies should be regulated. Coinbase argues that the SEC doesn’t have the authority from Congress to regulate digital assets. The company also says it didn’t get fair notice that it might be breaking any rules.

The post Coinbase Requests Regulatory Documents in SEC Lawsuit appeared first on Blockonomi.

• The U.S. government transferred 58.742 Bitcoin (worth about $4 million) to Coinbase on July 22, 2024.
• This Bitcoin was seized from Ryan Farace, convicted of selling Xanax on the dark web.
• The U.S. government still holds about $14.6 billion worth of cryptocurrency.
• Germany recently sold nearly 50,000 Bitcoin for $2.9 billion.
• These government sales and transfers of seized cryptocurrency are happening amid fluctuations in the crypto market.

On July 22, 2024, the United States government transferred 58.742 Bitcoin, worth approximately $4 million, to a Coinbase account. This move has caught the attention of the cryptocurrency community and market watchers.

The Bitcoin in question was originally seized from Ryan Farace, who was convicted in 2018 for selling Xanax pills on dark web marketplaces like Silk Road. Farace, known online as “Xanaxman,” initially forfeited 24 Bitcoin.

However, while serving his prison sentence, he was indicted again for attempting to move 2,874 Bitcoin out of the country with the help of his father, Joseph Farace.

In January 2024, the U.S. Department of Justice (DOJ) announced that it had successfully recovered 2,933 Bitcoin from the Farace family and planned to sell the seized cryptocurrency.

The recent transfer to Coinbase represents a small portion of this total amount, but it matches exactly the 58.742 Bitcoin mentioned in a DOJ press release from January as being seized on May 11, 2021.

This transfer emptied the wallet labeled “U.S. Government: Ryan Farace Seized Funds” on blockchain analytics platform Arkham Intelligence.

However, the U.S. government still holds a substantial amount of cryptocurrency, estimated at about $14.6 billion. The majority of this is in Bitcoin, with smaller amounts in Ethereum, Tether, and other cryptocurrencies.

The U.S. government’s move comes shortly after Germany announced a major sale of seized Bitcoin. The state of Saxony in Germany sold approximately 49,800 Bitcoin between June 19 and July 12, 2024, netting about $2.9 billion in what was described as an “unprecedented” sale.

The German Bitcoin came from an investigation into individuals accused of running piracy websites and money laundering.

These government sales and transfers of seized cryptocurrency are happening at a time when the crypto market is experiencing some fluctuations. The price of Bitcoin was around $66,874 at the time of the U.S. government’s transfer, showing a slight decrease of 0.51% over the previous 24 hours.

It’s worth noting that while $4 million worth of Bitcoin is a significant amount, it represents less than 1% of the total Bitcoin trading volume, which was about $46 billion in the 24 hours surrounding the transfer. This suggests that the government’s move is unlikely to have a major impact on Bitcoin’s price by itself.

The U.S. government’s handling of seized cryptocurrency assets is being closely watched by market participants. As one of the largest Bitcoin holders in the world, any moves the government makes with its crypto holdings can attract attention and speculation about potential market effects.

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