Coinbase has taken an unconventional legal approach in anticipation of a potential crackdown by the U.S. Securities and Exchange Commission (SEC).
Prior to the SEC’s lawsuit against Coinbase on June 6, the company had submitted “amicus” briefs in two other crypto-related cases, offering its perspective as a friend of the court.
Amicus briefs, although common at the U.S. Supreme Court, are rarely filed in federal trial courts, accounting for just 0.1% of cases, as reported by law firm Gibson Dunn & Crutcher.
However, the crypto industry has seen an increasing number of amicus briefs in SEC cases, with industry groups supporting defendants.
Although a ruling in favor of another crypto defendant would not be legally binding for Coinbase, it could potentially strengthen the company’s defense.
By filing amicus briefs, Coinbase aims to influence legal discussions and steer them in a direction that aligns with its interests.
This strategy is about setting the groundwork for addressing legal issues that the amicus is concerned about. One of the cases in which Coinbase filed an amicus brief was represented by Gibson Dunn, the same law firm that represents Coinbase itself.
The SEC’s recent focus has shifted from targeting developers who sell unregistered digital tokens to larger players like exchanges, in an effort to regulate the cryptocurrency market.
Coinbase has become the SEC’s prime target in the United States. The regulator filed a lawsuit in Manhattan federal court, alleging that Coinbase operated as an unregistered exchange, broker, and clearinghouse.
The SEC claimed that at least 13 of the cryptocurrencies available on Coinbase, including Solana, Cardano, and Polygon, were securities.
Coinbase initiated its legal defense strategy last year when it became the subject of SEC investigation.
The company enlisted the services of prominent law firms Gibson Dunn and Cahill Gordon & Reindel to handle the two cases. In one instance, Coinbase supported the dismissal of an insider trading case involving a former Coinbase product manager.
The primary argument in Coinbase’s amicus brief, which could foreshadow its defense in its own case, is that the SEC lacks the authority to regulate digital assets that are not securities.
The SEC, on the other hand, maintains that the legal test used to determine securities depends on the economic realities of transactions rather than their labels.
The regulator urges judges to consider how digital assets are marketed and highlights promises made by crypto developers regarding potential profits.
Coinbase also argues in its brief that the SEC has failed to provide clear guidelines to cryptocurrency industry participants, violating their right to due process.
Coinbase’s other amicus brief was filed in support of Ripple Labs, a high-profile battle the SEC engaged in prior to the Coinbase case.
The SEC sued Ripple Labs in 2020, accusing the company and its executives of conducting an unregistered securities offering by selling the cryptocurrency XRP. Coinbase urged the judge to allow the fair notice defense in this case, claiming that denying it would impact future cases.
The outcome of these legal battles will have significant implications for the cryptocurrency industry.
It remains to be seen how the courts will interpret and apply existing regulations to the evolving world of digital assets. A ruling in the Ripple case is expected later this year.
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Nevada’s Department of Business and Industry has issued a cease and desist order to Prime Trust, a crypto custodian, alleging that the company is facing a “shortfall of customer funds” and is unable to fulfill customer withdrawal requests.
According to the regulator, Prime Trust’s financial condition is deemed “critically deficient,” and the firm is now considered to be in an “unsafe or unsound condition” to continue its business operations.
The order, issued on June 21, states that Prime Trust has experienced a significant deterioration in its financial condition, leading to the inability to honor customer withdrawals.
The regulator further accuses Prime Trust of breaching its fiduciary duties by failing to adequately safeguard the assets under its custody.
It also highlights that the company is incapable of meeting all customer disbursement requests.
In response to the order, Prime Trust has 30 days to provide a response and can request an administrative hearing to contest the allegations. If the company fails to contest the order, it will be considered final.
This development comes shortly after Banq, the payments subsidiary of Prime Trust, filed for bankruptcy protection in the United States on June 13.
Additionally, BitGo, a provider of wallet infrastructure and digital asset custody, announced on June 22 that it has decided to cancel its acquisition of Prime Trust.
Cointelegraph reached out to Prime Trust for a comment on the matter, but an immediate response was not received.
The situation raises concerns about the financial stability and trustworthiness of Prime Trust as a custodian of crypto assets.
Customers who have entrusted their funds with the company may face difficulties in accessing their assets and may be uncertain about the safety of their investments.
The outcome of Prime Trust’s response to the cease and desist order will determine the future course of action and the potential repercussions for the company and its customers.
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Credit Agricole’s CACEIS, a leading financial services group, has officially registered as a digital asset service provider (DASP) in France.
This move solidifies the company’s entry into the cryptocurrency custody services market and highlights France’s growing support for the crypto industry.
The Autorité des Marchés Financiers (AMF), the French financial watchdog, has witnessed a steady rise in the number of crypto companies seeking registration, with CACEIS joining the ranks of prominent players.
France has been at the forefront of embracing the nascent cryptocurrency sector, demonstrating its progressive stance.
It notably became the first major European country to grant registration to Binance, the world’s largest cryptocurrency exchange.
The registration of subsidiaries from prominent names in French finance, including Societe Generale and AXA, further underscores the country’s commitment to fostering a favorable environment for crypto-related activities.
CACEIS, which boasted an impressive 4.1 trillion euros ($4.51 trillion) in assets under custody by the end of last year, has Credit Agricole SA as its majority owner, holding a 69.5% stake, while Santander possesses a 30.5% stake in the group.
This influential backing coupled with its new DASP status positions CACEIS as a formidable player in the cryptocurrency custody services space.
The registration of CACEIS as a DASP signifies an important milestone for the company and the broader financial industry.
As digital assets gain mainstream recognition, traditional financial institutions are recognizing the need to adapt and expand their service offerings to cater to the growing demand.
By venturing into crypto custody services, CACEIS aligns itself with the evolving financial landscape and positions itself to meet the needs of institutional and individual clients seeking secure and regulated crypto asset storage.
As the crypto market continues to mature, the involvement of established financial institutions brings increased credibility and stability to the industry.
It instills confidence in potential investors and paves the way for further integration of cryptocurrencies into the mainstream economy.
With its extensive experience and substantial assets under custody, CACEIS is well positioned to play a significant role in shaping the future of the crypto custody services sector.
In conclusion, Credit Agricole’s CACEIS has registered as a digital asset service provider in France, joining the expanding list of crypto companies approved by the AMF.
This strategic move demonstrates the institution’s commitment to embracing digital assets and providing secure custody solutions for the growing crypto market.
By leveraging its substantial assets under custody and the support of its majority owner, Credit Agricole SA, CACEIS is poised to become a key player in the evolving landscape of cryptocurrency custody services.
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Wirex, a crypto payment service, has alerted its customers in the European Economic Area (EEA) that its debit cards may cease to function due to licensing issues with its card provider, UAB PayrNet.
The announcement, made via email on June 23, follows a similar disclosure by Wirex’s competitor, Cryptopay, regarding potential card service disruptions in the region.
Wirex is a popular multi-currency crypto payment app that offers fiat on-ramps and off-ramps, along with debit cards.
With over 3 million users in Europe and Asia, Wirex assured its customers that their funds held in the app are secure.
The email clarified that while the card service interruption caused by UAB PayrNet’s problems will impact EEA customers, it will not affect their ability to access funds through other Wirex services, such as the IBAN service or cryptocurrency transfer and purchase options.
Customers were advised that no action is required on their part.
The underlying cause of the issue lies with UAB PayrNet, not Wirex’s internal system. On June 22, the Bank of Lithuania revoked UAB PayrNet’s electronic money institution license, citing multiple serious violations of legal acts and failures in administering Anti-Money Laundering measures.
However, the Bank of Lithuania reassured that customer funds are safe and held in dedicated accounts.
Attempts to contact UAB PayrNet for comment were unsuccessful. PayrNet’s director, Stephenas Couttie, expressed dissatisfaction with the bank’s actions, suggesting they may be disproportionate to the violations committed.
Wirex disclosed its plan to switch its debit card services to Transact Payments Malta Limited. Although this transition was already in progress, the current situation has expedited the process.
Wirex is collaborating closely with both PayrNet and Transact to restore the debit card system as quickly as possible.
During this interim period, Wirex customers in the EEA may experience card usage limitations.
Over the past two years, Wirex has been expanding its service offerings. In August 2022, it partnered with 1inch to enable wallet-based token swaps for its customers.
Additionally, Wirex integrated with the Avalanche network in February 2022, enabling users to deposit and spend AVAX through their Wirex debit cards.
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Just a few years ago, Shiba Inu (SHIB), a cryptocurrency that began as a meme, was becoming mainstream, minting new millionaires, and gaining a substantial following. Yet, the token has now seen a considerable drop in price, leading to questions about its future prospects. In particular, many investors wonder: can Shiba Inu reach $1?
Predicting the future value of a volatile asset like SHIB involves multiple factors, including macroeconomic conditions, adoption rate, and general market forces. Although the phrase “nothing is impossible” often echoes in the crypto market, SHIB reaching $1, despite its potential, is an ambitious target, especially considering its closest competitor, Dogecoin, has reached this feat only sporadically.
As of now, Shiba Inu’s price stands at $0.0000086, indicating a required surge of 116,279 times to reach $1. This achievement could be challenging given the token’s current market capitalization and circulating supply. However, the crypto market is known for its unpredictability, and considering SHIB’s previous rise of over 8,000,000%, a future surge cannot be ruled out.
According to data from Santiment, SHIB’s supply outside of exchanges has surpassed 911 trillion, a significant increase compared to 2021. This development suggests that many investors are holding SHIB for the long term, which could potentially fuel a bullish trend. Additionally, SHIB’s total number of holders has grown to 1.3 million.
The daily chart shows no signs of a downward crossover of the 50 EMA against the 200 EMA, implying that SHIB’s upside potential is still intact. The Chaikin Money Flow (CMF) indicates a value of 0.05, signaling an accumulation of SHIB. Should this accumulation continue, SHIB’s chances of nearing $1 could increase.
Although the journey towards $1 remains formidable, Shiba Inu is using a token burn mechanism to stabilize its value. This method involves sending tokens to dead wallets, rendering them unrecoverable and effectively reducing the total supply. This strategy could increase demand for SHIB in the long term.
Shibburn reports that more than 410 trillion tokens have been burned since the initial supply. The project is also focused on increasing utility with the development of the Shibarium L2 network. Despite being 89.74% down from its All-Time High (ATH) at the time of writing, Bone ShibaSwap suggests that SHIB could potentially hit the $1 milestone with maximum support for burn activity, Shibarium, and tokens within the Shiba Inu ecosystem.
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Global professional services company Accenture has recently announced a hefty $3 billion investment in its Data & AI division over the next three years. This substantial investment aims to empower clients across diverse sectors to leverage AI responsibly and rapidly for improved growth, resilience, and efficiency.
Julie Sweet, Accenture’s CEO, acknowledged the burgeoning interest in all facets of artificial intelligence. The considerable investment in the Data & AI sector will transition this interest into valuable actions, underpinned by sound business cases. Companies laying robust AI foundations now will be better equipped to capitalize on its mature, value-generating stage, leading to a competitive edge and enhanced performance.
Accenture’s Commitment to AI Integration
Accenture has been a pioneer in AI integration, folding AI into its service delivery methodology to deliver augmented efficiency, insights, and value to thousands of clients. Key platforms in this venture include myWizard, SynOps, and MyNav.
The company introduced its responsible AI framework six years ago, which is now integral to its service delivery, ingrained in its code of conduct, and serves as the foundation for its strict AI compliance program.
Accenture has also been working with clients on various generative AI projects, including helping a hotel company handle customer inquiries and aiding a judicial system in synthesizing complex documents.
AI Investment After Accenture Layoffs
Despite announcing 19,000 layoffs earlier this year as part of cost-cutting measures, Accenture is determined to capitalize on AI to spur innovation. Over the following 18 months, these layoffs will be gradually implemented.
Through hiring, acquisitions, and training, Accenture’s Data & AI division aims to double its AI talent to 80,000 employees. It also plans to develop industry-specific accelerators for data and AI preparation across 19 industries and utilize generative AI capabilities to create pre-built industry and functional models.
Accenture’s AI Navigator for Enterprise, a generative AI-powered platform, will help customers outline business cases and select suitable architectures, with additional resources to accelerate ethical AI practices and compliance initiatives.
This historical $3 billion investment signals Accenture’s resolve to pioneer AI-driven transformation.
Industry-Wide Implications
AI is fast becoming a game-changer in the business world, with industry giants like Canva, LinkedIn, Meta, and Google incorporating AI functionality into their product offerings.
According to an Accenture study, integrating AI into economic activities could quadruple the annual GDP growth rate by 2035. Furthermore, it can boost profitability by an average of 38%, helping businesses break free from the low-profit cycle.
Utilizing AI technology like computer vision, machine learning, deep learning, and natural language processing can address diverse problems. However, when combined, they create much more value, enabling businesses to shift towards value-added duties and improve customer service efficiency.
Other AI Investments
Accenture’s sizable investment marks the dawn of a new era of innovation and industry transformation as AI redefines our work. Other industry titans have also jumped on the AI bandwagon. PwC has pledged a $1 billion investment, EY has committed $2.5 billion, and Bain & Company has announced a service alliance with OpenAI. IBM has revealed the establishment of a Center of Excellence for generative AI, while Salesforce has set up a $500 million fund for generative AI startups.
Moreover, China’s Lenovo has committed a $1 billion investment over three years to expedite corporate AI use, signaling the escalating interest in AI’s transformative potential.
Investments in generative AI alone are projected to hit $42.6 billion by year-end, according to PitchBook, highlighting the accelerating pace of AI adoption across industries.
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The Euronext Amsterdam stock exchange has recently witnessed the introduction of a new equity exchange-traded fund (ETF) that provides investors in the Netherlands with access to a diverse range of Bitcoin-related company stocks.
Melanion Capital, a French investment firm, launched the Bitcoin Equities ETF on June 22, marking a new approach to investing in the Bitcoin ecosystem through equities.
The ETF tracks the Melanion Bitcoin Exposure Index, a custom basket of European and American stocks closely associated with the market price of BTC.
One key advantage of this ETF is its compliance with the European Commission’s Undertakings for the Collective Investment in Transferable Securities (UCITS) regulatory framework.
This framework ensures that the ETF adheres to established standards for managing and trading mutual funds while providing regulatory and investor protection requirements.
Consequently, investment firms can register and sell trading products across the European Union, offering a secure investment avenue.
Jad Comair, the CEO of Melanion Capital, expressed his enthusiasm about the expansion to the Euronext Amsterdam exchange, emphasizing that Dutch investors now have a “regulated and transparent solution” for gaining exposure to the Bitcoin ecosystem.
Comair acknowledged the significant interest in digital assets within the Dutch market and believes that the ETF presents an exciting investment opportunity within a regulated framework.
The Melanion Bitcoin Exposure Index comprises stocks from companies heavily invested in Bitcoin holdings, cryptocurrency exchanges, and mining operations.
Notable companies included in the index are MicroStrategy, which, under the guidance of Michael Saylor, has amassed over 140,000 BTC valued at more than $12.6 billion as of April 2023.
The index also features prominent exchange platforms like Coinbase and Robinhood, as well as mining firms such as Riot, Marathon Digital, and Hut8.
While the ETF aims to maintain correlation with the market performance of Bitcoin, a specific minimum correlation threshold has not been established.
Melanion’s Bitcoin Equities ETF is also listed on the Euronext Paris and Euronext Milan stock exchanges, further expanding its reach across European markets.
Bitcoin ETFs have been making headlines in June 2023, as BlackRock, the world’s largest asset manager, filed an application for a Bitcoin spot ETF with the United States Securities and Exchange Commission.
This move indicates the growing interest and recognition of Bitcoin as a legitimate investment option.
With the introduction of the Bitcoin Equities ETF on the Euronext Amsterdam stock exchange, Dutch investors now have a regulated and transparent avenue to participate in the Bitcoin ecosystem.
This development reflects the increasing acceptance and integration of digital assets into traditional financial markets, providing individuals with more diverse investment opportunities.
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FTX, the collapsed cryptocurrency firm, has taken legal action against investment firms and individuals connected to its previous operations in an attempt to reclaim over $700 million.
The lawsuit was filed on June 22 in the United States Bankruptcy Court for the District of Delaware and includes 16 counts against the defendants.
Among the defendants named in the lawsuit are K5 Global, an incubator and investment company, as well as Mount Olympus Capital and SGN Albany Capital, along with their affiliated entities.
Michael Kives and Bryan Baum, co-owners of K5 Global, are also listed as defendants. Kives, a former talent agent and aide to Hilary Clinton, hosted a dinner party attended by FTX’s then-CEO, Sam Bankman-Fried (SBF), in 2022.
The lawsuit described the event as a gathering of prominent individuals, including celebrities, billionaires, and a former presidential candidate.
According to the lawsuit, FTX-affiliated crypto trading firm Alameda Research transferred $700 million to Kives, Baum, and K5 Global.
However, the transfers were disguised as transactions between shell companies SGN Albany and Mount Olympus Capital.
The lawsuit aims to recover the funds that were transferred from Alameda Research to SGN Albany Capital and subsequently from Kives, Baum, and SGN Albany Capital to Mount Olympus Capital.
The lawsuit alleges that these transfers were avoidable and lacked equivalent value. In bankruptcy law, an avoidable transaction can be reversed under relevant regulations.
The lawsuit also highlighted the close personal ties between Kives, Baum, and SBF, with Baum even having his own bedroom in FTX’s Bahamas residence.
After FTX’s collapse, the suit claims that Kives and Baum collaborated with Bankman-Fried on a strategy to secure a bailout for FTX Group and protect their own interests.
In response to the lawsuit, K5 Global issued a statement to Cointelegraph, dismissing the claims as meritless.
They emphasized that K5 is a venture capital firm with over $1 billion in assets under management and unrelated to any funds from Bankman-Fried and his affiliates.
The spokesperson stated that K5 believed they were engaging in a legitimate and mutually beneficial business relationship with Bankman-Fried and considered the lawsuit to be baseless.
The lawsuit includes nine counts related to fund transfers, with Kives and Baum individually charged with aiding and abetting breach of fiduciary duty and dishonest assistance. SGN Albany Capital is charged with unjust enrichment.
The legal proceedings will determine the validity of these claims and the potential recovery of the funds sought by FTX.
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A recent paper claiming that Bitcoin’s scalability issues would hinder its adoption in the future has been strongly criticized by a team of researchers from the Bitcoin Policy Institute, a nonprofit think tank.
The researchers argue that the conclusions reached in the original paper, titled “Bitcoin’s Limited Adoption Problem,” are based on flawed assumptions about the nature of Bitcoin.
The first assumption challenged by the Bitcoin Policy Institute researchers is that payments on the Bitcoin network necessitate full network consensus for settlement.
They assert that this claim is inaccurate and fails to consider the mechanisms by which Bitcoin achieves consensus.
The second assumption disputed by the researchers is the idea that the addition of miners to the network slows down settlement times by delaying network consensus.
The institute researchers argue that this notion ignores the actual impact of miners on the timing of new transaction blocks and overlooks existing scaling solutions that have been widely implemented.
The third assumption rejected by the think tank is the assertion that there is an upper limit on Bitcoin payments due to the architecture of its blockchain.
The researchers argue that this claim fails to consider the scalability achieved through off-chain payments, which do not require consensus from the entire network and therefore provide greater scalability.
In their published paper titled “Bitcoin works in practice, but does it work in theory?,” the Bitcoin Policy Institute researchers from various reputable U.S. universities challenge the theoretical foundation of the “limited adoption problem.”
They emphasize that this problem is not reflective of how Bitcoin actually operates and criticize the original authors for their faulty understanding of the Bitcoin protocol.
While the institute’s research acknowledges that Bitcoin’s blockchain does face challenges in scaling for on-chain payments, they highlight that these issues have been recognized since Bitcoin’s inception and have been addressed through off-chain protocols.
They argue that Bitcoin scales through off-chain payments rather than increasing throughput at the base layer.
The researchers from the Bitcoin Policy Institute dismiss the original paper’s conclusions as misguided, highlighting that Bitcoin’s scalability concerns have been effectively managed over time.
They assert that the authors of the criticized paper have focused on theoretical obstacles that do not align with the practical realities of Bitcoin’s operation.
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Cryptopay, a popular EU cryptocurrency debit card provider, has faced a setback as the Bank of Lithuania revoked the Electronic Money Institution (EMI) license of its provider, UAB PayrNet.
This development may lead to Cryptopay debit cards in the EU ceasing to function. Although this could potentially restrict access to funds on the card, the company has assured customers that their funds are safe.
Cryptopay has encouraged users to expend or transfer their card balance promptly. Despite the possible disruption in card services, Cryptopay clarified that the overall user account operation remains unaffected.
The company recommended using the card to purchase crypto, withdraw cash from an ATM, transfer to another card, or use the balance at a store.
In case of a complete card service cessation, Cryptopay reassured that customers could recover their funds directly from UAB PayrNet, promising to facilitate the process if needed.
The problem is primarily impacting EU users. However, users in the United Kingdom might experience temporary disruptions due to a pause in card services to ensure operational stability.
The company anticipates a return to normal service within a few days in the UK.
Konstantin Gorin, Cryptopay head of support, expressed confidence in the company’s resilience in the face of this challenge, citing past successful navigation of similar crises in the banking system.
Gorin also mentioned the team’s work on a new debit program, with the priority to take care of affected clients.
Despite ongoing difficulties in the crypto debit card industry, signals of acceptance are emerging. In March, Mastercard declared its intention to integrate stablecoins into its payment network in the Asia-Pacific region, signaling an increasing acceptance of cryptocurrency in the traditional financial world.
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