“Is it a security? Is it a commodity pool? Is it a payment token? Is it a utility token? It’s a particularly important question … not just domestically, but also internationally.”
So said Jeff Bandman, a former fintech advisor at the U.S. Commodity Futures Trading Commission (CFTC), speaking to CoinDesk about Facebook’s Libra cryptocurrency in a live broadcast on Tuesday.
Stressing, “one of the most important question about Libra is what it is,” Bandman suggested there could be a long way to go before a decision is made by regulators over Facebook’s Libra, and how it’s cl
“It’s not as if Facebook can just select the category itself identifies with … and regulators will just agree to it. They [the regulators] will look behind the scenes, not just the form [of Libra], but the substance and function, and they will decide what it is.”
While an advisor at the CFTC, Bandman founded LabCFTC, the agency’s in-house unit dedicated to emerging technologies including cryptocurrency.
His comments come just a day after former CFTC chairman Gary Gensler argued in prepared remarks to the U.S. House of Representatives that in his view, Facebook’s Libra appears to be an investment vehicle, is thus a security, and should be regulated as such.
However, Bandman argued that, given Facebook’s ambitious is to reach its customers at a global scale, definitions of the token will likely vary.
“If Libra is a payment system, the payment system regulators are typically the central banks,” Bandman said. “And then you have to look at all the countries Libra is potentially being used or deployed. They may all have slightly different definitions. Maybe in the U.S., Libra is considered as a security, but maybe not in Switzerland.”
The types of regulators that are most concerned with the Libra project are those whose mandate is to look after financial stability, Bandman indicated.
“For the last a couple of years, different groups have looked at crypto assets and generally concluded they are not a threat to financial stability because they are small,” he said.
“But now all of a sudden you have a platform with 2.5 billion users. Anything that it does will necessarily be large. That doesn’t automatically mean it becomes a threat to financial stability. But because this is on such a scale that if this thing gets off the ground and launches, there could be financial stability implications on day one.”
Elsewhere in his remarks, Bandman also raised concerns over Facebook’s banning of crypto-related ads on its social media platform while developing its own token behind the scenes.
Facebook unveiled a policy in January 2018 to ban ads related to initial coin offerings and cryptocurrencies. It eased the ban by requiring a pre-approval process for certain types of ads in June 2018 and further softened the policy in May this year (just weeks before its unveiling of Libra).
“Something I personally find troubling is, Facebook, for a period of over a year, banned crypto ads while working on their own cryptocurrency,” he said, concluding:
“Instead of investigating on Libra, maybe people should investigate on that. That sounds to me like a … uncompetitive behavior.”
Bandman joined other speakers talking with CoinDesk in a live broadcast to unpack Facebook’s hearing at the Senate Banking Committee on Tuesday where the firm addressed lawmakers’ concerns over its ambitious Libra project.
ING to develop a cryptocurrency custodial platform
- The bank said that it sees “increasing opportunities” with regards to crypto.
- The project is reportedly being controlled from its Amsterdam offices.
According to a recent report by Reuters, major Dutch bank ING is currently working on a custodial platform that will enable their clients to store digital assets like cryptocurrencies. The firm stated that it sees “increasing opportunities” with regards to crypto – both asset-backed and security tokens.
ING bank aims at providing its users with a compliant way to access the sector. As per Reuters’ sources, the project is being controlled from its Amsterdam offices. However, it is still in its early stages. Additionally, the bank is also working on developing other blockchain initiatives. Not all banks are sharing ING’s enthusiasm. Another major Dutch institution,
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.
US court dismisses case against FTX worth $150 million
The U.S. court is said to have dismissed the case worth around USD 150 million against the cryptocurrency derivatives exchange FTX. It was said the suit was made due to market manipulation and unlicensed securities sales, but the court has not found any solid grounds to continue with the lawsuit.
The company called Bitcoin Manipulation Abatement LLC filed the suit for the sale of unlicensed securities in the U.S. and market manipulation.
It was said in the report that:
Defendant Alameda Research LLC’s motion to dismiss Bitcoin Manipulation Abatement LLC’s Amended Complaint in the above-captioned action came on regularly for hearing before the Court on February 13th, 2020. After considering the papers submitted by the parties and the argument of counsel, the Court finds that plaintiff has failed to comply with the requirements of Fed. R. Civ. P. 9(b) or 8(a)(2), and that dismissal is warranted under Fed. R. Civ. P. 12(b)(1) and 12(b)(6). Accordingly, Alameda Research LLC’s motion to dismiss is granted, and the Amended Complaint is dismissed in its entirety with prejudice.
In a reaction to the news infamous CZ (the CEO of Binance) said:
A market maker from a smaller futures exchange tried to attack @binance futures platform. NOONE was liquidated, as we use the index price (not futures prices) for liquidations (our innovation). Only the attacker lost a bunch of money, and that was that
It was clear that something went on but as always these things are hard to prove. This is not the first case of its kind but it is important that Binance had security measures in place to keep its customers safe.. Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.
Cryptocurrency Is Still the World’s Best Performing Asset Class This Year
As the year and decade come to an end, cryptocurrencies once again outperform other major asset classes.
Despite trading significantly down from their record highs of late December 2017, large-cap cryptocurrencies had a phenomenal year and remain one of the greatest investment success stories of the decade.
Cementing themselves as the world’s leading asset class for yearly performance, cryptocurrencies have risen well above annualized returns of the U.S. equities, commodities and bond markets for 2019.
Ryan Alfred, President and co-founder of Digital Assets Data said large-cap crypto assets possess significantly higher returns versus traditional markets for this year.
“Looking back at the performance of the top ten large-caps (Bitwise 10) in comparison to other major asset classes, we can see their special signature,” Alfred said.
Crypto versus traditional assets
As seen in the chart above, research provided by Digital Assets Data shows how this year’s performance of the top 10 cryptos by market capitalization fared against other major asset classes such as gold, oil and equities.
Of course, 2019 didn’t start out that way. Back in February, the top 10 crypto began a fairly dismal run, resting well below all other traditional asset classes when viewing their return on investment figures. However, sentiment began to pick up significantly in March and by mid-year, cryptocurrencies were far out ahead of other the other assets.
That gap has begun to narrow as stocks, bonds and commodities begin to increase their lead. Yet cryptocurrencies remain significantly ahead
Much of this rally is courtesy of bitcoin (BTC). The world’s first cryptocurrency is currently up 100 percent since the year began. Meanwhile, Ether, the world’s second-largest crypto is up 35 percent year-to-date, though XRP is down 25 percent from where it traded on Jan. 1.
The big picture: Crypto’s success story
In the year before the decade began, the world was in the throes of a financial crisis. Since then, stocks have rebounded. From its March 2009 market meltdown lows to now, the S&P 500 has gained a respectable 369 percent. Similarly, the Dow Jones Industrial Average has also had a good run, up 326 percent in that same time period.
However, BTC has blasted those figures, rising well above a staggering 12 million percent (yes, you read that correctly) over a one-year-shorter time frame, beginning March 2010. That’s when the price of 1 BTC was around $0.05, data taken from Messari shows.
Crypto’s success can likely be attributed to its most defining characteristics: high volatility and liquidity, allowing market participants to quickly and easily trade between digital and fiat currencies.
Lorenzo Pellegrino, CEO of Skrill, a cross-border payments platform utilizing crypto, said digital assets resembled a nascent market. Prices bouncing around in a frantic manner enable the asset class to outperform all others based on irrational sentiment and low barriers to entry.
“As it (crypto) matures we should start to see increased stability and the core fundamentals will become more apparent,” Pellegrino said.