The Breakdown First Five - Friday June 30, 2023

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Coinbase makes Motion

Coinbase has responded to the SEC’s lawsuit, but more importantly, they filed a motion to dismiss. Calling the actions of the SEC “an extraordinary abuse of process” the exchange claimed the regulator has no jurisdiction over Crypto assets. Coinbase are also asking the court to consider the ‘major questions doctrine’ which would require Congress to get more specific about the SEC’s authority over the Crypto industry. An initial hearing is set for July 13.

4. Fidelity files

Fidelity has joined the race for a spot Bitcoin ETF. The $4T asset manager has refiled their 2021 application, updating it with a surveillance-sharing agreement that matches other recent applications. Analysts currently have Blackrock’s application at an even chance to be approved in due course. Other applications match Blackrock in form, so we could soon see a deluge of spot Bitcoin ETFs.

3. UK passes Crypto Laws

The UK Financial Services and Markets Act has been officially passed into law. The British Crypto industry will now be regulated by the existing Financial Conduct Authority. Stablecoins will also be brought within the regulatory perimeter and treated as another payments system. Separately, the UK Law Commission has recommended classifying Crypto tokens as a third type of personal property, separate from physical and intangible assets.

2. Secret SEC comms

House Republicans have called out the SEC’s use of ‘off-chanel’ communications like Signal and Whatsapp to circumvent record keeping requirements. This SEC has been ruthless in prosecuting similar record keeping violations at Wall St firms, so these allegations speak to a disdain for the law within the agency. Without record keeping compliance in government, how can there be any accountability?

1. Gensler should recuse himself

The Blockchain Association has dropped a massive paper spelling out exactly why SEC Chair Gensler should recuse himself from Crypto enforcement decisions. The paper alleges that Gensler has prejudged the entire industry as violating securities law and therefore cannot make impartial decisions on individual cases. Expect to see this legal research used as a template brief for Crypto lawsuits moving forward.

Thanks for reading -NLW