Connect with us

SEC

Finance Redefined: Layer-two growth and the SEC’s scrutiny, Sept. 19–23

Published

on

Welcome to the latest edition of Cointelegraph’s decentralized finance, or DeFi, newsletter.

In a week where DeFi’s parabolic growth continued elsewhere, the United States Securities and Exchange Commission Chair Gary Gensler threatened to tackle stablecoins.

What you’re about to read is the smaller version of this newsletter. For the full breakdown of DeFi’s developments over the last week — released a whole lot quicker than Cardano’s smart contracts— subscribe at the bottom of this page.

Advertisement

Layer two’s defining the future

This week, analytical data revealed that DeFi continues to be one of the fastest-growing sectors of the crypto economy as evidenced by increases in the total value locked, or TVL, on protocols. Some of the biggest gains have been witnessed across cross-chain compatible networks and layer-two protocols that offer a lower fee environment.

Part of the Avalanche network, Trader Joe is a protocol that has experienced significant inflows since the launch of an upgraded cross-chain bridge. It allows Ethereum-based tokens and applications to migrate to its ecosystem, which has resulted in a 53.96% increase in TVL this week.

The recent emergence of layer-two technologies such as Arbitrum, Optimism and a bridge to the Avalanche ecosystem is revolutionizing the way investors, builders and developers interact with various protocols.

Each facilitates fast, low-cost transactions that improve the fundamentals of the DeFi ecosystem while also making it easier for retail-sized investors to capitalize on opportunities.Reported by Jordan Finneseth

Advertisement

U.S. against the SEC

United States investment firms Invesco and Galaxy Digital Funds teamed up this week to file a registration statement with the SEC in a bid to gain approval for the sale of Bitcoin exchange-traded funds (ETF).

If approved by the SEC, the Invesco Galaxy Bitcoin ETF will be registered as a securities offering with the ability to get listed on traditional national exchanges in the United States. According to the filing, the trust will use “robust physical barriers to entry, electronic surveillance and continuously roving patrols” to protect Bitcoin privacy.

Likewise, fellow U.S. firm Amplify ETFs also filed a registration with the SEC; in this case, to add DeFi-centric, open-end ETF funds offering to the Amplify ETF Trust. Approval of the FORM N-1A filing will allow the company to issue unlimited new shares for American investors.Reported by Arijit Sarkar

Advertisement

SushiSwap denies reports of billion-dollar bug

One of the developers behind the popular decentralized exchange SushiSwap has rejected a purported vulnerability reported by a white-hat hacker snooping through its smart contracts. 

According to media reports, the hacker claimed to have identified a vulnerability that could place more than $1 billion worth of user funds under threat, stating they went public with the information after attempts to reach out to SushiSwap’s developers resulted in inaction.

However, SushiSwap’s pseudonymous developer soon took to Twitter to reject the claims, with the platform’s “Shadowy Super-Coder” Mudit Gupta stressing:

Advertisement

“This is not a vulnerability. No funds at risk. If rewarder runs out of rewards, withdrawing LP will fail but anyone (not just sushi) can top up the rewarder in an emergency. Sushi can also just remove the rewarder.”

Reported by Samuel Haig

Token Performances

DeFi’s TVL has fallen sharply by 16.08% this week to a figure of $105.15 billion — paralleling the decline of the top DeFi tokens.

Data analysis from Cointelegraph Markets and TradingView reveals that DeFi’s top 20 tokens by market capitalization suffered heavy losses acrossthe last seven days, with only three tokens printing bullish price action. 

Avalanche (AVAX)took the top spot on the podium for bullish gains this week with a respectable 13.7%. After a final day surge, Ren nudged over the green line, but still in a distant second with 0.64%, while Dai made up the numbers in third with 0.34%. When a stablecoin makes the top three, that’s when you know it’s been a bad week!

Advertisement

Want to further your education? Read these additional stories:

  • DeFi’s potential means more institutional demand for next-gen tokens
  • Senator Warren’s office confuses MakerDAO for failed 2016 project The DAO
  • Sommelier partners with Mysten Labs to launch Cosmos smart contract

Thanks for reading our conspectus of DeFi’s biggest stories this week. Join us again next Friday for a round of fresh stories, developments and insights from the world of DeFi.

News Source

SEC

SEC’s Investor Advisory Committee to Discuss Crypto on December 2

Published

on

  • SEC’s Investor Advisory Committee will soon discuss crypto and digital assets today.
  • This is to ensure serene investor protection and market integrity in the face of new technologies.

The US SEC’s Investor Advisory Committee is on its heels to discuss their nagging concern about crypto and ‘Investor Protection’ on December 2, 2021.

Truth be told, the panel will highlight all the ins and outs of digital assets with a special focus on the regulatory framework that governs them. With no exemption, the authority will take on this event to explore and identify the main lines of intersection of digital assets, sooner rather than later.

They hope to do this with a specific lens to examine the ups and downs of the market issues. Prior to this, the committee will further define the compounding risk and its associated dangers in the emerging technologies in the crypto market.

Advertisement

On this note, apart from the crypto discussion, the panel will address various topics regarding blockchain technology, stablecoins, and crypto-based ETFs. All these topics will be treated publicly in one holistic manner under the event.

Moreover, the meeting agenda is quite a solid move that seeks to ensure smooth market integrity. In essence, it aims to also empower a good outlook when it comes to investors’ protection, particularly in the face of new technology.

People think that this occasion is a good opportunity for the SEC to rethink and restructure its harsh crypto regulation approach.

Advertisement

News Source

Continue Reading

SEC

SEC Chair: Innovation Around DeFi “Could Be Real”

Published

on

Gary Gensler believes that DeFi could offer “real innovation,” but he is convinced that the sector will not survive without regulatory compliance.

U.S. Securities and Exchange Chair Gary Gensler said that new technologies do not tend to persist if they fail to come into compliance with the law during a fireside chat with Jay Clayton at the Digital Asset Compliance & Market Integrity Summit.

While Gensler believes that decentralized finance could be the source of innovation, he claims that it has to fall within the existing regulatory framework:

The innovation around DeFi could be real, but they won’t persist if they stay outside of the regulatory framework.

Gensler also voiced his concerns about the centralization of some DeFi projects and implied that the goal of such projects might be to skirt existing anti-money laundering laws.

Speaking of the regulator’s reluctance to approve a spot Bitcoin exchange-traded fund, Gensler told No. 42 that trading around the globe is not inside the U.S. regulatory register. He urged the trading and lending platform to “come in and talk”:

Advertisement

Trading and lending platforms are really in an important place for investor and consumer protection. Come in and talk to us… work with us. Where appropriate we’ll use the enforcement tool. Work to get registered with the law.

The SEC boss has reiterated that stablecoins remind him of poker chips at a casino:

[Stablecoins] made it more efficient within the ecosystem. But it also allowed people around the globe, the people who tried to, to avoid money laundering and tax compliance in jurisdiction after jurisdiction.

According to Gensler, stablecoins are responsible for 80% of trading on the crypto market.

News Source

Advertisement
Continue Reading

SEC

SEC Commissioner Will Not Say If Ether Is a Security

Published

on

The SEC remains mum about Ether’s regulatory status amid accusations of picking winners and losers that come from the increasingly frustrated XRP community.

U.S. Securities and Exchange Commissioner Hester Peirce did not answer whether or not Ether, the second-largest cryptocurrency, is a security when asked by her Twitter follower.

Advertisement

The “Crypto Mom” says that she is willing to build a “sensible and clear” regulatory framework for cryptocurrencies, but she will not focus on particular digital assets.

As reported by U.Today, SEC Chair Gary Gensler has repeatedly dodged the very same question on numerous occasions, making it clear that he will not speak about separate cryptocurrencies to remain neutral.

At the same time, the agency has distanced itself from a 2018 speech made by its former top official William Hinman, in which he famously said that Ether is not a security.

Advertisement

Amid the SEC’s almost year-long legal battle with Ripple, calls for regulatory clarity continue to persist.

Last month, Ripple CEO Brad Garlinghouse opined that Ether had managed to surpass XRP by market capitalization because of the SEC’s “free pass.”

Peirce, despite being a staunch crypto supporter for years, has refused to speak about the Ripple case since SEC Commissioners are prohibited to speak about ongoing litigation or enforcement actions.

News Source

Advertisement
Continue Reading