The American Bankers Association, Bank Policy Institute, Financial Services Forum, and Securities Industry and Financial Markets Association sent a letter to President Joe Biden on May 31, urging him to sign the resolution passed by Congress to overturn the SEC’s Staff Accounting Bulletin 121 (SAB 121). The letter outlines that SAB 121, issued without regulatory […]
Bitcoin News
Senate Urged to Pass Landmark Crypto Bill After Biden Vetoes Resolution to Overturn SEC Rules
Following President Joe Biden’s veto of the resolution to overturn the U.S. Securities and Exchange Commission (SEC)’s controversial crypto rules in SAB 121, U.S. lawmakers in both the Senate and House of Representatives have intensified their efforts to pass the landmark crypto bill, the Financial Innovation and Technology for the 21st Century (FIT21) Act. ‘Senate […]
Bitcoin News
President Biden Vetoes SEC SAB 121 Repeal Resolution
U.S. President Joe Biden issued a veto against H.J.Res. 109, a resolution that would disapprove of the Securities and Exchange Commission’s (SEC) Staff Accounting Bulletin No. 121 (SAB 121). In its veto document, Bides states that the approval of this Republican-led resolution would “inappropriately constrain the SEC’s ability to set forth appropriate guardrails and address […]
Bitcoin News
House Approves Resolution to Overturn SEC’s Crypto Rules — Biden Threatens to Veto
The U.S. House of Representatives has passed H.J. Res. 109, a resolution aimed at overturning the Securities and Exchange Commission’s SAB 121 regulations on digital assets. The resolution seeks to reduce regulatory burdens and promote safer custodianship of digital assets by regulated banks. However, the White House has backed the SEC, issuing a veto threat, […]
Bitcoin News
‘Controversial’ Bitcoin Proposal to Curb Inscriptions Ignites Fierce Debate, Ends Without Resolution
On Friday, Jan. 5, 2024, the debate surrounding Bitcoin developer Luke Dashjr’s proposal to restrict all varieties of data-bearing transactions concluded as the topic veered into “controversial” territory. Bitcoin Core custodian and Blockstream staff member Andrew Chow terminated the Github dialogue, marking it as a “stalemate discussion.”
Intense Dispute Over Bitcoin’s Data-Carrying Transactions Culminates in Discussion Lockdown
The recent surge in Bitcoin Ordinal inscriptions has riled up the developers responsible for the protocol’s codebase. In September 2023, Luke Dashjr spearheaded a new pull request (PR) named “datacarriersize: Match more datacarrying.” In essence, the proposal aims to amend the datacarriersize parameter in Bitcoin to cap all varieties of data-bearing transactions. Dashjr, along with the proposal’s supporters, contend that Bitcoin’s code inherently curbs spam, and this PR is merely extending an existing datacarriersize restriction to another type of data.
Following its introduction, the proposal elicited a wide array of responses, with some individuals expressing approval of the idea while others firmly believed it to be fundamentally flawed. Peter Todd remarked that the “transactions targeted by this pull-req are a very significant source of fee revenue for miners.” Todd added that it is unlikely that bitcoin (BTC) miners would give up the revenue. “Censoring those transactions would simply encourage the development of private mempools – harmful to small miners – while making fee estimation less reliable,” Todd emphasized.
Chris Martl offered a dissenting opinion to Todd’s argument, asserting that the primary impact would be on node operators who would face increasing expenses. “The transactions targeted by this pull-req. are a very significant source of prohibitive cost for regular node operators,” Martl contended. “It is very unlikely that regular node operators will give up mitigating that source of operative cost. Regular policy rule for these transactions would encourage the economical resource usage of mempools – not harming any miners – neither changing any fee estimation already on the field,” Martl explained.
Pieter Wuille, also known as “Sipa,” disagreed with Dashjr’s proposal and argued that it did not serve the interests of Core’s software users. Wuille said that engaging in transaction relay and maintaining a mempool is crucial for forecasting upcoming block compositions. Willfully omitting transactions, despite their “clear (however stupid) economic demand,” undermines this predictive capability, without even negating the necessity to validate them upon mining. Wuille added:
I believe the demand for [block space] many of these transactions pose is grossly misguided, but choosing to not see them is burying your head in the sand.
The debate intensified, with numerous voices asserting that these transactions did not constitute spam, while others vehemently argued the opposite. “It seems to me that the proposed change here is more harmful than beneficial,” Mark “Murch” Erhardt wrote in response to Dashjr’s proposal. “Except that most new node runners are Ordinals indexers, and inscribers. Ordinals are here to stay, fork off or accept it,” another person insisted. On Friday, Bitcoin maintainer and Blockstream employee Andrew Chow shut the conversation down.
“It’s abundantly clear that this PR is controversial and, in its current state, has no hope of reaching a conclusion that is acceptable to everyone,” Chow said. “At this point in time, I see no reason to leave this open and to continue to send notifications for the constant back-and-forth stalemate discussion.” The discussion was then locked for being “too heated and limited conversation to collaborators.”
As the dust settles on the intense debate around Dashjr’s proposal to limit data-bearing transactions in Bitcoin, the development community stands divided. With voices raised high from both supporters and detractors, the conversation’s abrupt closure by Chow underscores the complexity and passion embedded in Bitcoin’s ongoing evolution. The discussion, though halted, leaves an indelible mark on the narrative of Bitcoin’s development and the diverse community that surrounds it.
What do you think about the discussion concerning Dashjr’s proposal and the conversation getting locked over being too heated? Share your thoughts and opinions about this subject in the comments section below.
Brazilian CVM Resolution Comes Into Effect, Allowing Funds to Allocate Part of Their Portfolios Into Crypto
The Brazilian Securities and Exchange Commission (CVM) has opened the doors for investment funds to invest in cryptocurrency. Resolution 175, drafted last year and coming into effect on October 2, defines the rules these institutions must follow to invest in crypto, with analysts predicting a rise in interest in the sector.
Brazilian CVM Resolution 175 Comes Into Effect
Resolution 175, introduced by the Brazilian Securities and Exchange Commission (CVM) last year, came into effect on October 2, officially opening the possibilities for investment funds to invest directly in crypto in Brazil. Brazilian analysts declared they believe the resolution will bring institutions to pursue more opportunities in the cryptocurrency sector.
Now, investment funds can invest up to 10% of their portfolio in digital assets. However, there are some limits put forth by the CVM, as these institutions are only allowed to purchase cryptocurrencies from exchanges approved by the country’s central bank or international regulatory bodies.
According to Caio Sanas, partner at Caio Sanas Lawyers, this reduces the options for investment funds. Sanas explained that besides the U.S.-based cryptocurrency exchange Coinbase, there are not many companies capable of fulfilling the CVM requirements with the liquidity needed to supply Brazilian institutions with the crypto demanded.
However, the resolution is seen to recognize and legitimize the interest of institutions in cryptocurrency assets. Henrique Lisboa, a capital markets partner at VBSO Advogados, stressed that the CVM “recognized the interest of investors and managers in exploring the opportunities of the crypto-economy” with this regulation.
Limits to Protect the Market
The limitation on the number of exchanges available also results in a limit on the number of crypto assets available for purchase, indirectly conditioning investment funds to only invest in cryptocurrencies listed by these exchanges. Sanas further explained that the 10% investing limit was necessary to protect investors from market falls like the one experienced when FTX went bankrupt last year.
Sanas stated:
If the funds had invested the 10% allowed in FTX crypto assets, what would have happened? The resolution advanced with the necessary precautions for a financial or capital market. It is the CVM’s role to defend investors.
Furthermore, he explained that funds had only effectively allocated from 1% to 3% in digital assets, as the current market conditions have not contributed to a larger movement from these market actors into crypto.
What do you think about Brazilian investment funds allocating part of their portfolio to cryptocurrency assets? Tell us in the comments section below.
Bankruptcy Tussle Between Crypto Firms FTX and Genesis Nears Resolution
The long-standing legal feud between FTX Trading and Genesis Global Holdco is taking a turn towards resolution. The two parties have reached an initial agreement, in principle, following bankruptcy protection disputes that have made industry headlines. An official letter to the bankruptcy judge representing their cases has affirmed the intent of the firms to put their settlement into motion.
FTX, Genesis Engage in Crypto Bankruptcy Settlement
The saga, rooted in the insolvency of FTX Trading, began when the company claimed that Genesis, a crypto lending platform, owed them a sum of nearly billion. This claim could have considerably slowed down Genesis’ court procedures. Now, with the letter to the presiding judge dated July 27, 2023, the path to settlement seems more tangible, promising to bring an end to the bankruptcy bickering.
The missive to the court represents a significant step in resolving the issue between the disputing parties. FTX Trading Ltd., and its associated debtors, along with the debtors in the Chapter 11 bankruptcy case, have confirmed that they’ve reached a preliminary agreement. The court filing states:
The parties have reached an agreement in principle, subject to documentation, regarding a settlement that would resolve, among other things, the claims asserted by the FTX debtors against the debtors in these Chapter 11 Cases and the claims asserted by the Genesis debtors against the FTX debtors in the FTX Chapter 11 cases.
Moreover, the settlement plans to dismiss FTX’s motion to modify the automatic stay and the motion to establish procedures for estimating the number of FTX debtors’ claims against the debtors.
In essence, the settlement’s approval would mean the withdrawal of these motions, simplifying the otherwise complex legal proceedings. The settlement’s details are yet to be disclosed. However, the involved parties detailed they are set to act swiftly to formalize their agreement and seek approval from the court.
Genesis continues to grapple with additional legal tussles, including a freshly lodged lawsuit aimed at its parent entity, Digital Currency Group (DCG), as well as its CEO and progenitor, Barry Silbert.
What do you think about FTX and Genesis coming to an agreement? Share your thoughts and opinions about this subject in the comments section below.
Fitch Maintains Negative Watch on US Rating Despite Debt Limit Resolution
Although the U.S. has averted defaulting on its debt obligations, Fitch Ratings still has concerns about the country’s ability to repay its debt. As a result, the credit rating agency has placed the U.S. “AAA” rating on negative watch, emphasizing that recent events have lowered “confidence in governance on fiscal and debt matters.”
Fitch Ratings Still Has Concerns About the US
Fitch Ratings, one of the three largest credit rating agencies in the U.S., announced on Friday that the United States’ “AAA” credit rating remains on “negative watch” despite the recent debt limit agreement reached in Congress. The other two major rating agencies in the U.S. are Moody’s Investors Service and Standard & Poor’s.
The U.S. avoided having to default on its debt obligations after Congress passed a bill Friday to suspend the debt limit until Jan. 1, 2025. Without the agreement reached in this bill, the country could default on its debt obligations on June 5, according to Treasury Secretary Janet Yellen.
“The suspension of the debt limit was in line with Fitch’s expectations and the United States’ ‘AAA’ sovereign rating,” the rating agency noted. However, the company explained:
Repeated political standoffs around the debt-limit and last-minute suspensions before the x-date (when the Treasury’s cash position and extraordinary measures are exhausted) lowers confidence in governance on fiscal and debt matters.
“In fact, there has been a steady deterioration in governance over the last 15 years, with increased political polarization and partisanship as witnessed by the contested 2020 election, repeated brinkmanship over the debt limit and failure to tackle fiscal challenges from growing mandatory spending has led to rising fiscal deficits and debt burden,” Fitch continued.
While noting that its U.S. rating is supported by the country’s “exceptional strengths, including the size of the economy, high GDP per capita and dynamic business environment,” Fitch detailed:
The U.S. dollar is the world’s preeminent reserve currency, which gives the government unparalleled financing flexibility. Some of these strengths could be eroded over time by governance shortcomings.
Multiple people have warned that the debt crisis could erode the U.S. dollar’s dominance, including veteran investor Jim Rogers and economist Peter Schiff. However, some insist that the USD will remain the world’s reserve currency, including Moody’s. The rating agency said last month that the U.S. dollar will remain the dominant currency in international trade and finance for decades to come, despite new challenges.
What do you think about Fitch Ratings’ concerns? Let us know in the comments section below.
Texas Lawmaker Launches Resolution to Protect Bitcoin Investors, Support BTC Economy
A legislative proposal has been introduced to support the bitcoin economy in the U.S. state of Texas. “The individuals who own bitcoin should be protected” under the Texas Constitution, the proposal describes. “No citizen of Texas shall ever be deprived of their right to own bitcoin and that all bitcoin owners will be protected as they enjoy all the privileges associated with the cryptocurrency.”
Resolution to Support Bitcoin Economy
A legislative proposal called House Concurrent Resolution 89 (HCR89), which expresses support for the bitcoin economy in Texas, was introduced in the state’s House of Representatives on Monday by Rep. Cody Harris. Concurrent resolutions require the approval of both the House and the Senate in the state but do not have the force of law.
The resolution reads:
The individuals who own bitcoin should be protected under Section 9, Article I, Texas Constitution, which states that ‘The people shall be secure in their persons, houses, papers and possessions, from all unreasonable seizures or searches’; this right should also extend to digital possessions, such as cryptocurrencies.
Moreover, the resolution not only aims to obtain backing from the state legislature to protect “individuals who code or develop on the Bitcoin network” but also welcomes bitcoin miners “to seek out any forms of energy to help secure the Bitcoin network in the state of Texas.”
The resolution adds: “Individuals who mine bitcoin in Texas will never be inhibited by any law or resolution that restricts the practice of securing the Bitcoin network for the safety of the virtual currency.”
Furthermore, the resolution states:
No citizen of Texas shall ever be deprived of their right to own bitcoin and that all bitcoin owners will be protected as they enjoy all the privileges associated with the cryptocurrency, including the immunity afforded by censorship-resistant spending of bitcoin and the ability to store bitcoin in an unhosted wallet without undue interference from any state agency.
What do you think about this resolution to protect bitcoin owners and support the bitcoin economy in Texas? Let us know in the comments section below.
US Senator’s Resolution Encourages Capitol Gift Shops to Accept Cryptocurrency
A U.S. lawmaker has introduced a resolution that encourages Capitol gift shops to accept cryptocurrency payments. He stressed that lawmakers “should increase accessibility and signal our support for the burgeoning cryptocurrency industry to those who visit Capitol Hill.”
US Senator Advocates Crypto Payments
U.S. Senator Ted Cruz (R-TX) announced Thursday that he has reintroduced the Adopting Cryptocurrency in Congress as an Exchange of Payment for Transactions (ACCEPT) Resolution. Cruz first introduced this resolution in November 2021. The senator from Texas said:
Cryptocurrency is generating new jobs, encouraging entrepreneurs to invent new values and creating new hedges against inflation, and presenting new opportunities. It is also increasingly being used as a secure form of payment for goods and services.
“This is precisely why we, here at the United States Capitol, should increase accessibility and signal our support for the burgeoning cryptocurrency industry to those who visit Capitol Hill,” he added.
Senator Cruz’ explained that his bill “would require the Architect of the Capitol, the Secretary of the Senate, and the Chief Administrative Officer of the House of Representatives to encourage Capitol gift shops to accept cryptocurrency as a form of payment.” They would also be required “to enter into contracts with vendors who accept cryptocurrency as payment for food service and in vending machines within the Capitol complex.”
Cruz further said:
An added advantage of using cryptocurrency as a form of payment in the Capitol is that it would provide foreign tourists who visit our nation’s capital each year with a safe and secure payment option without the need to pay unnecessary and often costly currency exchange fees.
The lawmaker has long been a pro-bitcoin senator. In May last year, he said he is “incredibly bullish” on bitcoin. “I have a weekly buy that’s an automatic buy every week of bitcoin because I believe in dollar-cost averaging,” he noted at the time.
Senator Cruz also introduced a bill in April last year to prohibit the Federal Reserve from developing a direct-to-consumer central bank digital currency (CBDC) “which could be used as a financial surveillance tool by the federal government, similar to what is currently happening in China,” Cruz noted.
What do you think about Senator Ted Cruz pushing for gift shops on Capitol Hill to accept payments in cryptocurrency? Let us know in the comments section below.