Content creators on the internet will now be able to accept payments in XRP tokens directly from their users. The tipping-for-content has become possible because of Coil, the brainchild of Stefan Thomas, the former CTO
Earlier this week, the cryptocurrency markets slumped: Bitcoin (BTC) lost its $6,500 support, and Ethereum (ETC) dropped well below the $400 mark (rates stand at $6,620 and $319 respectively by the press time). While it’s important to remember that on such a volatile and scarcely regulated market, news might affect the prices to a lesser degree, and the recent drop correlated with the U.S. Securities and Exchange Commission (SEC) decision to postpone its verdict on the listing and trading of a Bitcoin exchange-traded fund (ETF) until late September.
The SEC has gained the reputation of being a major news-maker in the cryptocurrency field: The watchdog’s decisions toward the market have been associated with a number of price drops and bull runs.
When: July 2017
FREE CRYPTO COIN JUNKY HANDBOOK - 147 page guide covering Crypto Fundamentals, Beginners/Advanced Crypto Trading Strategies, Crypto Mining Techniques, ICO Investment strategies, and so much more.
CRYPTO TRADING STRATEGY GUIDES - Whether You're Day Trading, Swing Trading, Or Just Investing...Our Extensive Guides Will Get You To Where You Want To Be.
Alleged reaction: Slightly bearish
In July 2017, the SEC came through with a major decision, putting its mark of interest on the crypto market. The regulator reviewed the infamous decentralized autonomous organization (DOA) case and concluded that DAO tokens, issued via its Initial Coin Offering (ICO) back in 2016, were in fact securities and hence had to register with the SEC beforehand.
By making that move, the SEC effectively showed that many other ICOs, which were abundant during their unregulated, ‘free run’ throughout the 2016-2017 period, might be in trouble as well. In order to determine if an ICO constitutes a security or not, the SEC usually applies the Howey Test — essentially, if a token is marketed as a profit-oriented asset, most likely it will be deemed a security being offered by the agency. However, the watchdog has explained that such decisions are made on a case-by-case basis, as the facts and circumstances of any investment transaction — including economic realities — will determine whether the transaction constitutes the offer of sale of a security.
Even though the SEC decided not press any charges that time, it gave a clear signal that the ICO frenzy could be over. Nevertheless, the market barely reacted: While the top five coins fell in price on the day of the announcement, the overall reaction wasn’t dramatic. Ethereum went down about 10 percent, but soon bounced back to its previous value. It might have been the result of market volatility rather than the SEC news, as such.
When: July 2018
THE COMPLETE IDIOTS GUIDE TO MARGIN TRADING ON BITMEX - Beginner Strategies for Generating Consistent Profits with Margin Trading on Bitmex
TOP 3 BITCOIN CASINO & SPORTSBETTING SITES OF 2018 - Looking to Have a Little Fun with Your Crypto? Check Out the Latest & Most Innovative Crypto Gaming & Sportsbetting Sites on the Web
Alleged reaction: Slightly bearish
The prospect of getting an authority-sanctioned, crypto-backed ETF has been widely discussed in the crypto community. Some believe it will provoke mass adoption, and the prices will ascend, while others remain skeptical — leaning toward crypto-anarchic sentiments. The SEC gets to decide if the industry is ready for an ETF, and the watchdog hasn’t been particularly optimistic thus far.
In either case, the market tends to react to most ETF-related news. A stark example is the recent SEC’s denial of the Winklevoss twins second application on July 26, which happened just prior to the latest ETF-induced panic in the market. The SEC wasn’t convinced by the Winklevoss’ plea that Bitcoin markets are “inherently resistant to manipulation,” which was among the primary reasons for the rejection.
As mentioned above, the Winklevoss brothers had tried registering a Bitcoin ETF before — their first attempt dates back to 2013. That time, it took the SEC four years to come up with a decision: Finally, on March 10 of last year, the agency denied the initial application based on concerns “that significant markets for Bitcoin are unregulated.”
Both times, the market reacted negatively. In March 2017, the price of Bitcoin fell from $1,300 to around $1,100 in a single day. In July 2018, BTC lost over $400 within the span of just three hours, although it managed to regain its value within the following 24 hours — SEC Commissioner Hester M. Peirce’s statement of official dissent, which was published soon after the hearing, could have helped in that rebound. In it, she opined that the agency’s move “sends a strong signal that innovation is unwelcome in our markets, a signal that may have effects far beyond the fate of Bitcoin ETPs [Exchange Traded Products],” recognizing the SEC’s influence in the market.
When: August 2018
Alleged reaction: Strongly bearish
Similarly, this catastrophic week on the crypto market is largely associated with the SEC postponing its decision on the listing and trading of a Bitcoin ETF powered by investment firm VanEck and financial services company SolidX until Sept. 30.
The VanEck SolidX ETF application was submitted in June and was generally considered to be the most promising among crypto-backed ETFs: It didn’t feature bold assumptions akin to the one submitted by the Winklevoss twins that claimed BTC markets are “inherently resistant to manipulation.” Moreover, the VanEck SolidX fund is physically backed — meaning that it will actually hold BTC — and both firms have reassured that this will protect against the loss or theft of the cryptocurrency. According to their filing with the SEC, each share of the VanEck SolidX Bitcoin Trust is set to cost a hefty $200,000. As SolidX CEO Daniel Gallancy explained to CNBC, the price is set at a higher rate to focus on institutional investors, and the fund hopes to get listed on the Cboe BZX Equities Exchange.
On Aug. 7, the SEC issued a document citing their right to extend the review period. It also stated that the agency had received more than 1,300 comments on the proposed rule change to list and trade the VanEck SolidX BTC shares. Per the document, within 45 days of the filing of a proposed rule change — the trust submitted their application on June 6 — or within 90 days, should the Commission deem necessary, the Commission will approve, disapprove or extend the period of consideration.
While the news seemed rather neutral, and essentially meant that the SEC simply needs more time to rule whether the crypto industry is suitable for an ETF at the moment, panic induced and the markets plummeted: After solid growth to break above the $7,000 mark earlier that day, BTC saw a loss of around $500 in six hours and has lost around 12 percent this week. Similarly, other coins crashed as well — e.g., Ripple (XRP) lost as much as 23 percent of its value since the news was announced.
On the other hand, bullish news on the market that came out recently, like the announcement of upcoming cryptocurrency project Bakkt by the Intercontinental Exchange (ICE), which operates 23 large global exchanges — including New York Stock Exchange (NYSE) — appeared to be largely ignored. In an interview with CNBC, Pantera Capital CEO Dan Morehead claimed that investors were “overreacting” to the SEC postponing the ETF hearing. He predicted that a Bitcoin ETF approval will take “quite a long time,” citing the nascent stage of crypto adoption. The hedge fund manager also stressed that the most recent asset that gained approval from the SEC for ETF certification was copper, a metal that “has been on earth for 10,000 years.”
When: February 2018
Alleged reaction: Strongly bullish
On Feb. 6, the SEC — along with the Commodities and Future Trading Commission (CFTC) — held a highly anticipated joint hearing in which they elaborated on their stance toward cryptocurrencies, ICOs and blockchain technology. During the meeting, the regulators gave credit to the cryptocurrency industry for adding a new paradigm to the financial system, stressed the importance of fair regulatory frameworks and famously said that “if there was no Bitcoin, there would be no blockchain.”
Consequently, that promoted a bullish trend, and the community reaction following the hearing had a positive effect on the crypto market — which was staggering at the time, likely due to China reiteration of it’s zero-tolerance of crypto, rumors of a ban in India and some mainstream banks prohibiting cryptocurrency purchases with their credit cards. After the SEC/CFTC showed their positive stance in regard to some crypto industries features, Bitcoin and Ethereum saw 20 percent growth in value, and the rest of the cryptocurrency market rallied into the green.
When: June 2018
Alleged reaction: Slightly bullish
The SEC’s approach to cryptocurrencies is still not crystal clear. However, at this point it becomes evident that, while the agency considers most ICOs to be securities, the two leading cryptos — Bitcoin (BTC) and Ethereum (ETH) — are not seen as such. That sentiment was recently voiced by Jay Clayton, the chair of the SEC, who declared that BTC is not a security because it acts as a replacement for sovereign currencies:
|“Replace the dollar, the yen, the euro with Bitcoin. That type of currency is not a security.”|
Soon after the news broke, Bitcoin’s price went from $7,525 up to $7,728 within 24 hours, showing a slight growth.
A couple of days after that, William Hinman, the director of the SEC’s division of corporation finance, claimed that Ethereum (ETH) isn’t a security either, putting an end to a months-long dilemma that could have potentially ended up with Ethereum’s 2014 ICO being outlawed:
|“Putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions[…] And, as with Bitcoin, applying the disclosure regime of the federal securities laws to current transactions in Ether would seem to add little value.”|
That signal was positive for ETH, meaning that it wouldn’t face any charges. Consequently, the coin’s price rose as much as 11 percent, up to $520.68.
When: March 2018
Alleged reaction: Slightly bearish
In March 2018, the SEC issued a public warning aimed at crypto exchanges. The watchdog explicitly stated that platforms who trade “securities” — and the SEC deems many altcoins as such — “must register with the SEC as a national securities exchange or be exempt from registration.” The announcement read:
|“The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not. Many platforms refer to themselves as ‘exchanges,’ which can give the misimpression to investors that they are regulated or meet the regulatory standards of a national securities exchange.”|
Hence, major crypto exchanges were urged to comply with the SEC’s regulations, entailing a strick Know Your Customer (KYC) and Anti-Money Laundering( ATL) approach, among other things — some major U.S.-based exchanges, like Coinbase, have since tried to register with the authority.
The news coincided with a noticeable downtrend in the market: For instance, BTC went down 8.6 percent from 24 hours earlier, losing its $10,000 support. However, the surge could have been initiated by other factors, such as rumours about an alleged Binance security breach that were spreading around the time.
Leave a Comment
Latest Crypto News
In a supernormal rally that almost lost ethereum its silver spot, ripple (XRP) gained about 100 percent in a week. The maximum difference in XRP’s market cap between the week’s lowest and highest level turned
The U.S. Navy Naval Air Systems Command (NAVAIR) is currently exploring the blockchain technology for tracking aviation parts throughout its lifecycle, according to its press release. For NAVAIR, changing the way it currently tracks the lineage
As Canada prepares to legalize recreational marijuana next month, the impact this will have on online drug marketplaces has remained unclear. Consequently, the Department of Public Safety Canada is looking to commission a study that will shed
On Friday, Sept. a U.S. member of Congress announced that he will introduce three new bills aimed at supporting the development of blockchain technologies, as well as the use of cryptocurrency, within the United States. Rep. Emmer:
Using candlestick formations in order to determine price movement from one direction or another is great for what it does within a more confined timeframe. The problem is, the level of detail that you get
Poloniex, one of the oldest crypto exchanges in the global market, has become a major digital asset trading platform once again after years of stagnation. Until 2015, Poloniex was one of the largest crypto exchanges
A “Flippening” has once again arrived in the cryptocurrency markets, but — much to the chagrin of ethereum investors — it’s not the one that ETH holders have long anticipated. Bolstered by a seemingly-parabolic rally
U.S. lawmakers have called on the Internal Revenue Service (IRS) to issue clarified and “comprehensive” crypto taxation guidance, in an open letter submitted yesterday, September 19. The letter was sent to acting IRS commissioner David Kautter by Congress
Cryptocurrency exchange operator Coinbase has denied that it engages in proprietary trading and that these activities account for a large percentage of the firm’s overall trading volume. Yesterday an investigation into cryptocurrency exchange policies and
With the explosion of cryptocurrency, more online gamblers have demanded that casinos open up their spending options to this new digital asset, which seems to be a “perfect match” for these type of platforms. FortuneJack
The cryptocurrency markets are nine months into a bear market, but the animal spirits that drove the bitcoin price to nearly $20,000 haven’t disappeared. Rather, it seems that they have found a new outlet —
For the first time in history, US household wealth has surged above the $100 trillion mark, fueled by the rise in the value of stocks and properties. However, analysts say the unsustainable growth in household
MyCrypto, a non-custodial Ethereum and ERC20 token wallet created by the co-founder of MyEtherWallet, has integrated a feature that enables Ethereum users to schedule ETH transactions ahead of time. On MyCrypto, an open-source wallet that is structurally similar
Botnets have become increasingly powerful over the last few years, to the point where the US Department of Homeland Security admitted that they couldn’t face the problem alone and needed help from the white hat community. Botnets
Since mid-2017, Ethereum hackathons have been held in many major cities across the globe, to encourage the development of decentralized applications (dApps) and blockchain-based systems. ETHGlobal, the biggest Ethereum hackathon organization to date, has played a key
Sign Up Below!
Airdroppin the Latest Crypto News, Trading Strategies, Tools, & Reviews
Crypto Guides & Tutorials