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Ripple Wins a Partial Victory Against SEC as Judge Rules XRP is Not a Security 

Ripple wins a partial victory against SEC as judge rules XRP is not a security

The price of XRP has surged by over 75% overnight following the landmark summary judgment. 

In a significant step forward for the cryptocurrency industry, a U.S. judge delivered a summary judgment ruling that Ripple Labs Inc did not violate federal securities law by selling its XRP token on public exchanges. 

This ruling marks the first win for a cryptocurrency company in a case brought by the U.S. Securities and Exchange Commission (SEC). The judge, Analisa Torres, summarily dismissed the SEC’s allegation that Ripple conducted a $1.3 billion unregistered securities offering.  

The recent development brings an interesting twist to the long-standing three-year legal dispute between Ripple and the Securities and Exchange Commission (SEC). However, it’s important to note that this decision was made in a trial court and there is a possibility that some of these findings might be appealed and overturned. In 2020, the SEC filed a lawsuit against Ripple, accusing them of violating U.S. securities laws by selling XRP without proper registration with the agency.

It’s important to note that the ruling can only be considered a partial win for Ripple as the judge did find that they violated federal securities law by selling XRP directly to sophisticated investors. The SEC has expressed satisfaction with this partial victory and is reviewing the decision.

The ruling caused the value of XRP to soar by 75%, and Coinbase, the largest U.S. crypto exchange, announced that it would resume trading of XRP on its platform. The case’s outcome is significant for the broader cryptocurrency industry as it challenges the SEC’s stance on the classification of crypto tokens as securities and could influence future regulations and legislation in the sector. 

Just last month, the SEC initiated legal action against Binance and Coinbase, alleging the sale of unregistered securities. The lawsuit specifically identified several cryptocurrencies, including BNB, BUSD, SOL, ADA, MATIC, FIL, ATOM, SAND, MANA, ALGO, AXS, and COTI, as securities. The news brought hope to crypto investors, as it indicated that there is a possibility that other altcoins issued by different companies may not be deemed securities after all. However, it is important to note that the outcome of each token’s classification as a security will depend on individual investigations conducted as part of the court case, and there is no guarantee that they will be treated similarly. 

You can learn more about SEC/Binance court case here.  

BlackRock CEO changes mind on Bitcoin 

BlackRock CEO Larry Fink claims that BTC is an international asset that could revolutionise finance.

Over the past few weeks, certain financial giants have done a serious backflip on their previously anti-crypto stances. Invesco, Fidelity and WisdomTree are just a few of the institutions dipping their toes into the crypto waters. Now, BlackRock has joined the fray after filing paperwork for a spot Bitcoin ETF with the SEC. 

BlackRock CEO Larry Fink sat down with Fox Business to discuss his company’s entry into the space and future goals. He claims that Bitcoin is an “international asset” that can be used to hedge against deflationary fiat currencies, especially for those living in countries with corrupt governments.

However, he believes Bitcoin may struggle to “revolutionise finance” in its current state due to concerns over how expensive and difficult to invest in it is. That’s where BlackRock enters the picture – by offering a spot ETF, Fink believes he can help the industry edge toward an accessible solution for global investors.

Speculators largely ignored these comments, as Bitcoin remains stable around the USD $30k mark. It appears the market already priced in the TradFi explosion late last month, when the coin’s value rose by 15%. 

Of course, not everyone in TradFi has been so generous toward the crypto industry. Fink’s bullish claims came a mere matter of days after the CEO of JPMorgan Chase – one of the biggest banks in the United States – called Bitcoin owners “stupid”. Gee, thanks for that, mate! 

Only time will tell which of these multi-billion dollar giants is right

Standard Chartered speculate Bitcoin could hit $120k USD by end of 2024 

The British banking firm also projected BTC may breach the $50k barrier in 2023’s second half. 

Amidst the elation of the 2021 crypto bull market, Bitcoin’s price seemed destined for a date with the $100k USD mark. But $68k was as high as the coin’s value got before the enthusiasm died down and the crypto market settled in for a long winter. 

In spite of the last run’s failure to break six figures, British bank Standard Chartered believes that $100k is just around the corner. In fact, their latest projections suggest that the price of BTC will likely breach $120k by the conclusion of 2024. This would represent a nearly 400% increase from the coin’s current value, which is hovering around $30k. 

Standard Chartered lists several reasons why they think there will be upward pressure on Bitcoin’s price in the coming months. For starters, they believe the ongoing bank crisis – led by the collapse of Silicon Valley Bank – may usher in a new era of alternative currencies. The projection was also bullish on the impact of the upcoming Bitcoin halving event, slated for April 2024. Improved miner profitability, as well as diminishing supply, are potential outcomes that may push BTC’s value toward their projected figure. 

Standard Chartered also projected that Bitcoin may re-test the $50k barrier by the end of this year. Whether these predictions prove accurate or turn out to be based on hope and optimism, will be worth following the over next 18 months. Remember, take all of these numbers with a serious grain of salt. The very same bank predicted that Bitcoin would crash to $5,000 in 2023. Which, of course, is yet to happen.

The amount of ETH staked has surpassed the amount kept on exchanges 

More participants staking Ethereum bodes well for the protocol’s long-term security.  

For the first time, more Ether is being staked than held in centralised exchange wallets. According to a report from crypto analysts Nansen, about 23.81 million ETH is being staked, compared to the 23.36 million stored in exchange reserves. This marks a 40% turnaround since the start of 2023 – 20% less Ether in exchange wallets, and 20% more Ether being staked.  

What’s behind this radical, dynamic shift?  

The short answer: Ethereum’s much-anticipated Shanghai Upgrade, which went live in March earlier this year. In TL;DR terms, the protocol upgrade allowed thousands of Ethereum validators to access their locked-up ETH for the first time since December 2020. Since then, 5.7 million ETH has flowed into the protocol alongside approximately 200,000 new validators.

Of the 23 million ETH currently staked, the vast majority is done via a liquid staking solution. This is because running a node on a personal computer comes with some tough technical requirements, so using a proxy is often much easier. The platform with the biggest market share by far is Lido DAO, which accounts for 31.9% of all staked Ethereum. Other big players include Coinbase (10%), Binance (5.1%) and Rocket Pool (3.18%).   

The increase in independent validators, and the amount of ETH staked, have positive ramifications for the blockchain’s economic security going forward. Staking is how Ethereum achieves decentralisation – so by spreading the responsibility of validating new transactions among a larger network of people, the chances of malicious attacks being successful are reducing. 

NFT market continues nosedive as it hits 2-year low 

Even blue-chip NFT collections like Bored Ape Yacht Club (BAYC) are feeling the pinch.  

In 2021, the NFT market exploded into vibrant life. You only had to scroll through Instagram or Twitter for a few seconds to spot unique cartoon avatars worth thousands of dollars. Those days appear long gone, as 2023 has been far from kind to the digital collectibles market.   

One of the most-used metrics for the NFT industry’s health is the New NFT Sales count. This gives analysts a good idea of how much new investment is coming into the scene, even if average prices are declining. At its peak in mid-2022, the average daily count was hitting close to 120k per day. Last week, the average daily count had plummeted to just 11.6k – a 90% decrease.  

And according to a report from analytics firm Nansen, royalties distributed from Ethereum-based NFTs have sunk to their lowest point in over two years. This is a big deal, as innovation in the industry will continue to slow if creators are disincentivised from losing out on revenue .

Adding insult to injury is the poor performance of blue-chip NFT collections. Floor price refers to the absolute minimum one could pay to buy any NFT (usually the most common) in a collection. In the “good old days”, picking up the cheapest Ape from the BAYC would set an investor back over 120 ETH (at the time. This week, that figure is just 33 ETH. The same is true for the groundbreaking CryptoPunks, where the floor price has plunged from its peak of 110+ ETH to 47. Keep in mind that the price of ETH was close to double what it is currenlty during these bullish NFT periods.  

It’s not all bad news for the NFT market though. Although digital collectible activity on Ethereum is dwindling, the opposite is occurring on major competitor Solana. SOL’s daily NFT transaction count is up 2x since April, according to Messari. Perhaps the future isn’t so bleak after all.

Former SEC Chair says Bitcoin ETF may be approved under certain conditions 

Jay Clayton believes the SEC will find it hard to deny spot Bitcoin ETFs if they work similarly to futures products.  

The Securities and Exchange Commission (SEC) has been a source of much angst among the crypto industry of late. They are in the midst of legal battles with several major players – headed by Coinbase, Binance and XRP (Ripple). Yet, their staunchly crypto-negative stance has softened in the past month, as the regulatory body considers approving the first spot Bitcoin ETF under their jurisdiction. 

In an interview with CNBC, the previous SEC head, Jay Clayton, predicted that lawmakers will likely approve a Bitcoin ETF in the coming months – under one condition. Those applying for spot ETFs (BlackRock, Invesco and Grayscale, to name a few) must prove that their products will function similarly to a Bitcoin futures ETF.

Bitcoin futures ETFs are comprised entirely of futures contracts. This means that the fund manager purchases contracts that give them the right to buy or sell Bitcoin at a specific price on a specific date. While this exposes investors to BTC without having to store any coins themselves, it doesn’t reflect the current price of Bitcoin. And therein lies the benefit of a spot crypto ETF – investors are essentially buying Bitcoin without worrying about wallets, hacks or exchange fees. 

The SEC has already demonstrated their appetite for Bitcoin futures ETFs, approving products such as the ProShares Bitcoin Strategy ETF (BITO). If TradFi companies can show their spot Bitcoin funds are of similar “efficacy” to their futures-based alternatives, Clayton believes it’s only a matter of time until they hit the public markets. 

Written by

Ben Knight