Law Decoded, July 25-August 1
Despite some good signs of the crypto prices recovery, last week could hardly be called bright for the market, as the major news came from the enforcers and not the regulators. According to a report from the New York Times, the United States Treasury Department’s Office of Foreign Assets Control (OFAC) has been investigating crypto exchange Kraken for allegedly allowing users based in Iran and other countries to buy and sell crypto in a potential violation of U.S. sanctions.
In the other hemisphere, the Philippines’ think tank Infrawatch PH filed a twelve-page complaint calling on the local Securities and Exchange Commission (SEC) to crack down on Binance’s activities in the country. The news comes shortly after the Philippines’ Department of Trade and Industry (DTI) waved off a Binance ban proposal in early July, citing a lack of regulatory clarity, as one of the world’s largest crypto exchanges indeed still doesn’t hold a license in the Philippines.
These developments form an alarming trend, given the ongoing investigation by the U.S. Securities and Exchange Commission into Coinbase’s alleged trading of unregistered securities. Michael Bacina, an Australian digital assets lawyer with Piper Alderman, told Cointelegraph that the impact on exchanges might occur whether or not the tokens are ultimately found to be securities. And, it would be serious and chilling for both those exchanges and the token projects.
Cathie Wood sells Coinbase shares amid insider trading allegations
One of the largest stockholders of the Coinbase cryptocurrency exchange has dumped a massive amount of shares due to a reported probe by the SEC. Cathie Wood’s investment firm Ark Investment Management has sold a total of more than 1.4 million Coinbase shares, or 0.6% of the exchange-traded fund’s (ETF) total assets. Based on the selling day’s closing price, the value of the sold shares amounted to slightly more than $75 million.
No stablecoin bill in the U.S. until September
Lawmakers in the United States House of Representatives have reportedly pushed back the timeline for considering a bill addressing the potential risks of stablecoins. According to a report from the Wall Street Journal, people familiar with the matter said House members will likely delay voting on a stablecoin bill until September after being unable to complete a draft in time for a committee meeting. The unresolved issues in the bill reportedly included provisions on custodial wallets from the Treasury Department and concerns from the SEC.
IMF suggests dark clouds ahead for crypto
The IMF’s July update on the World Economic Outlook titled “Gloomy and More Uncertain” points to “higher-than-expected inflation” and a contraction of global output as indicators of incoming poor economic growth. And, unfortunately for the crypto industry, in that sense, it is still heavily tied to the global financial market — the report cites the crypto bear market as one of the global macro factors.