Blockchain infrastructure firm Paxos has announced plans to issue a US dollar-backed stablecoin for its customers in Singapore. The initiative comes after Paxos reportedly received preliminary approval from the Monetary Authority of Singapore (MAS), paving the way for the establishment of Paxos Digital Singapore Pte. Ltd. This entity will operate under the Payments Services Act (PSA) while awaiting full regulatory approval to conduct business in Singapore.

 

The Initial Approval and Road Ahead for Paxos

 

The in-principle approval granted by the Monetary Authority of Singapore positions Paxos to offer digital payment token services, marking a significant step towards establishing a foothold in the Singaporean market. The regulatory green light provides an opportunity for Paxos to engage with customers under the PSA, demonstrating a commitment to compliance while awaiting full approval.

 

Upon receiving the anticipated full approval, Paxos plans to collaborate with enterprise clients to issue a US dollar-backed stablecoin. This move aligns with the increasing global demand for the US dollar, addressing challenges faced by consumers outside the United States in accessing dollars securely and reliably while adhering to regulatory protections. “Global demand for the US dollar has never been stronger, yet it remains difficult for consumers outside the US to get dollars safely, reliably, and under regulatory protections,” said Paxos Head of Strategy Walter Hessert in a statement.

 

It is worth mentioning that the announcement comes just over a year after Paxos was granted an operating license in the Southeast Asian country, allowing it to provide tokenization, custody, and trade services under the same bill as per Wednesday’s announcement. Paxos is known for its commitment to transparency, evident in its practice of publishing monthly attestations and reserve reports for its stablecoins. This commitment to openness not only builds trust but also sets a benchmark for regulatory compliance in the cryptocurrency space.

 

Stablecoin Market Growth

 

Paxos’ decision to delve into stablecoins aligns with the burgeoning growth of this market segment. According to brokerage firm Bernstein, the stablecoin market is projected to witness substantial growth, soaring from $125 billion to an estimated $2.8 trillion over the next five years. This expansion signifies a rising demand for stable digital currencies, and Paxos is poised to capitalize on this trend.

 

Analysts, including Gautam Chhugani, predict that major global financial and consumer platforms will play a pivotal role in the stablecoin market’s growth. The concept of co-branded stablecoins, closely linked to these platforms, is expected to facilitate seamless transactions and enhance user engagement within their ecosystems. This integration is seen as a key driver for the mass adoption of stablecoins beyond specialized crypto platforms.

 

Aside from the US dollar, the stablecoin market is seeing developments in other currencies. Circle’s European Union strategy and policy director, Patrick Hansen, highlighted the potential growth of the euro stablecoin market. Remarkably, Circle, a well-known crypto player, currently has one of the top five Euro-pegged stablecoins, the Euro Coin (EUROC).

On Monday, October 30, the Dow Jones Industrial Average (INDEXDJX: .DJI) gained by over 511 points or 1.58%, ending the trading at 32,928.96. This was the biggest single-day gain market by the index, after June 2023. The S&P 500 saw a robust 1.2% surge, reaching 4,166.82, marking its most substantial gain since late August. Simultaneously, the Nasdaq Composite also advanced, rising by 1.16% to 12,789.48. This week is big for traders with major announcements ahead such as jobs report, Federal Reserve rate decision, and Apple Inc‘s (NASDAQ: AAPL) earnings.

 

The Communication services sector led the way in S&P 500 (INDEXSP: .INX) performance, surging by over 2% in its most substantial daily gain since late August. Mega-cap tech giants Amazon.com Inc (NASDAQ: AMZN) and Meta Platforms (NASDAQ: META) followed suit, with impressive jumps of 3.9% and 2%, respectively.

 

These developments follow the S&P 500’s recent dip into correction territory last week. During the week, the broader index experienced a 2.5% decline, pushing it more than 10% below its closing high for 2023. Moreover, it has sustained a 2.8% drop in October, signaling its third consecutive month in the red, which hasn’t occurred since the pandemic’s outbreak in 2020. Speaking to CNBC, Art Hogan, chief market strategist at B. Riley Financial said: “We closed on the lows last week. Oftentimes when you get that kind of negativity going into a weekend and nothing new arises that changes the outlook for markets and the economy, you get a bit of a claw back on Monday.”

 

“Investors are finally feeling a little bit more confident that perhaps we priced in enough bad news and that’s really manifesting in a stronger market today,” he added.

 

All Eyes on the Fed Decision

 

The Federal Reserve’s upcoming decision on Wednesday is highly anticipated, and it’s widely expected that the central bank will maintain its current benchmark interest rate. Given that the recent stock market correction has been primarily driven by rising interest rates, investors are eager for any signals from the Fed that it may conclude its rate hikes. Many traders anticipate that the Fed will refrain from further rate increases for the remainder of 2023.

 

Hogan said: “Whilst we have a Fed meeting, the consensus has never been clearer that they’re not going to do anything at this particular meeting, and that’ll be back-to-back meetings of them not raising rates. I think that may signal that the cycle of raising rates is over, and I think that that likely helps to sort of stop that parabolic rise we’ve seen in Treasury yields.”

 

At the beginning of last week, the 10-year Treasury yield surged above the 5% mark, but it was hovering around 4.89% on Monday. The upcoming October jobs report, scheduled for Friday, is eagerly awaited by investors, as they are looking for signs of a potential labor market slowdown. A more relaxed labor market would likely make the Federal Reserve more comfortable with maintaining its current interest rate levels for the remainder of the year.

The Open Network (TON) Believers Fund, a non-profit fund operating as a smart contract on the TON blockchain has successfully raised a remarkable 1.3 billion TON coins (approximately 25% of TON supply) from users that will be locked for 2 years.

This impressive achievement has far-reaching implications for the project and showcases the remarkable support and enthusiasm of the crypto community for TON.

 

The TON Believers Fund in a Nutshell

As highlighted in a blog post, the TON Believers Fund was designed with the core mission of attracting large holders and early miners within the TON community. By locking their TON holdings into the smart contract, these contributors effectively take them out of circulation.

This reduction in the circulating supply has the potential to exert upward pressure on the TON token’s price. Additionally, it addresses questions and concerns surrounding TON’s tokenomics, bolstering confidence among investors and users.

Users were given the option of locking their TON coins for five years and expecting rewards through a mechanism similar to regular staking or donating their TON coins to a reward pool that would benefit those who had locked their coins for the specified duration.

The minimum donation threshold was set at 50 TON, making it accessible to a wide range of community members. Funds were accepted until the closure of the initiative on October 23, 2023. The TON coins deposited will remain locked until October 12, 2025, with a gradual unlocking schedule over the subsequent three years.

At the time of writing, the price of TON stands at approximately $2.17, reflecting a notable 11.28% increase in the past week. While it is challenging to attribute this price movement solely to the TON Believers Fund, it is worth noting that TON, like other cryptocurrencies, is influenced by market dynamics.

However, TON’s recent positive news, increased development activity, and strategic investments, such as MEXC Ventures’ eight-figure commitment, have also contributed to its growing appeal.

 

Participation and Support for TON Believers Fund

Since its launch, the TON Believers Fund collected a substantial amount of TON tokens. To be precise, it gathered 1,317,379,088 TON coins. This total comprises 1,034 billion TON locked by users and 284 million TON donated for rewards. Participants can anticipate a reward of approximately 7%.

The TON Foundation, crucially, extended its support to this initiative, bolstering the project’s support. The foundation helped promote the event and secured an additional 1 million TON. In tandem with the foundation’s action, a prior vote in the same year’s winter saw 1.1 billion TON locked in for 48 months. This significant commitment involved funds from large inactive early miner addresses.

In total, these two initiatives account for more than 2.3 billion TON tokens being locked for the next several years. Astonishingly, this figure represents nearly 50% of the total TON supply, which is a significant milestone for the project.

After finding that the sanctioning of Tornado Cash only led to the introduction of many other crypto mixers around the world, the United States Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) has announced new proposed measures to combat the growth of international crypto mixers. According to the announcement, FinCEN highlighted a Notice of Proposed Rule Making (NPRM) in a bid to identify international convertible virtual currency mixing as a security threat through money laundering. Precisely, FinCEN highlighted that the CVC mixing has significantly enabled illegal activities and terrorist acts by Hamas, Palestinian Islamic Jihad, and the Democratic People’s Republic of Korea (DPRK).

 

US Takes Geopolitical Fights to the Crypto Market

The announcement comes a year after the Department of Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash for ostensibly aiding in laundering more than $7 billion of illegal proceeds. However, the US bid to control software development has been met with notable resistance by crypto leaders, including Coinbase Global Inc. (NASDAQ: COIN) CEO Brian Armstrong. Moreover, most of the crypto mixers are a result of open-source software development; in the same way, a road builder cannot be blamed for the careless driving that leads to fatal accidents.

Nonetheless, the United States government has argued that terrorists have been finding their operations through crypto mixers, hence making the ongoing war in Ukraine and Israel more difficult.

 

“CVC mixing offers a critical service that allows players in the ransomware ecosystem, rogue state actors, and other criminals to fund their unlawful activities and obfuscate the flow of ill-gotten gains,” said FinCEN Director Andrea Gacki. “This is FinCEN’s first ever use of the Section 311 authority to target a class of transactions of primary money laundering concern, and, just as with our efforts in the traditional financial system, Treasury will work to identify and root out the illicit use and abuse of the CVC ecosystem," she added.

 

The United States has played a crucial role in supporting both Ukraine and Israel in their respective wars through financial aid and military support. Earlier this week, Tether, the leading stablecoins company, announced that it worked closely with Israel’s National Bureau for Counter Terror Financing (NBCTF) in identifying and freezing 32 addresses with about $873k linked to the Hamas group in Gaza.

Earlier this year, Israel Defense Minister Yoav Gallant announced that the NBCTF had seized crypto assets belonging to Lebanon’s Hezbollah and Iran’s Quds Force, amounting to over $1.7 million. Notably, the NBCTF worked closely with blockchain analytic and forensic firm Chainalysis in identifying and freezing the funds.

After finding that the sanctioning of Tornado Cash only led to the introduction of many other crypto mixers around the world, the United States Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) has announced new proposed measures to combat the growth of international crypto mixers. According to the announcement, FinCEN highlighted a Notice of Proposed Rule Making (NPRM) in a bid to identify international convertible virtual currency mixing as a security threat through money laundering. Precisely, FinCEN highlighted that the CVC mixing has significantly enabled illegal activities and terrorist acts by Hamas, Palestinian Islamic Jihad, and the Democratic People’s Republic of Korea (DPRK).

 

US Takes Geopolitical Fights to the Crypto Market

 

The announcement comes a year after the Department of Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash for ostensibly aiding in laundering more than $7 billion of illegal proceeds. However, the US bid to control software development has been met with notable resistance by crypto leaders, including Coinbase Global Inc. (NASDAQ: COIN) CEO Brian Armstrong. Moreover, most of the crypto mixers are a result of open-source software development; in the same way, a road builder cannot be blamed for the careless driving that leads to fatal accidents. Nonetheless, the United States government has argued that terrorists have been finding their operations through crypto mixers, hence making the ongoing war in Ukraine and Israel more difficult.

 

“CVC mixing offers a critical service that allows players in the ransomware ecosystem, rogue state actors, and other criminals to fund their unlawful activities and obfuscate the flow of ill-gotten gains,” said FinCEN Director Andrea Gacki. “This is FinCEN’s first ever use of the Section 311 authority to target a class of transactions of primary money laundering concern, and, just as with our efforts in the traditional financial system, Treasury will work to identify and root out the illicit use and abuse of the CVC ecosystem," she added.

 

The United States has played a crucial role in supporting both Ukraine and Israel in their respective wars through financial aid and military support. Earlier this week, Tether, the leading stablecoins company, announced that it worked closely with Israel’s National Bureau for Counter Terror Financing (NBCTF) in identifying and freezing 32 addresses with about $873k linked to the Hamas group in Gaza. Earlier this year, Israel Defense Minister Yoav Gallant announced that the NBCTF had seized crypto assets belonging to Lebanon’s Hezbollah and Iran’s Quds Force, amounting to over $1.7 million. Notably, the NBCTF worked closely with blockchain analytic and forensic firm Chainalysis in identifying and freezing the funds.

Immutable, a leading company in web3 gaming, has announced a strategic partnership with Amazon Web Services (AWS), a major cloud computing services provider, to achieve its goal of making Web3 gaming go mainstream. This cooperation is part of the company’s wider vision of making game development safer, easier, and more accessible using blockchain technology.

 

Benefits of the Immutable-Amazon Web Services Collaboration

Through this partnership, Immutable will be able to grow its business further as AWS provides it with a large pipeline of potential gaming studio partnerships worldwide. AWS account managers are encouraged to find gaming studio leads for Immutable. Also, the cloud computing service provider offers up to $100,000 in promotional cloud credits to gaming studios through AWS Activate, and this will allow Immutable to provide cloud service coverage, make deals with studios, and build more interesting games.

For game developers and studios, this collaboration unlocks the combined potential of Immutable’s Web3 gaming platform and AWS’s cloud infrastructure. Developers can build and run games that use blockchain verification and true digital asset ownership—key parts of a viable blockchain gaming model.

As part of the collaboration, Immutable has joined the Amazon ISV Accelerate Program, which helps software partners expand their businesses on AWS. Immutable gets access to expert resources and support to efficiently secure customers and close more deals.

John Kearney, head of startups at Amazon Web Services, Australia, and New Zealand, while commenting on the cooperation, said:

“Today, web3 gaming is one of the fastest growing sub-sectors of the blockchain industry and is already enjoyed by millions of gamers worldwide… AWS is supercharging Immutable’s development by onboarding new game studios and providing them with resources through our flagship AWS Activate startup program and AWS’s ISV Accelerate Program, which give them the tools to accelerate their global launch.”

 

Immutable’s Growth and Future Plans

Immutable’s growth has been substantial as demand for web3 gaming rises. By teaming up with industry leaders like AWS, it will be able to incorporate its solutions into existing game development processes. The company has used AWS services like Amazon EventBridge and AWS Lambda to build a flexible architecture that scales well. This has allowed it to handle more partnered games and improve reliability as its user base grows.

Immutable chose AWS for its security, performance, proximity to users, and ability to scale, and the partnership will significantly move the Web3 gaming ecosystem forward by empowering builders and gamers. Combining blockchain’s ownership features with AWS’s cloud infrastructure unlocks new possibilities.

Looking ahead, Immutable plans to continue investing in its AWS-powered infrastructure to support upcoming offerings. This includes Immutable zkEVM, which will enable Ethereum compatibility and blockchain gaming without needing to learn a new programming language. With AWS’s backing, the company is positioned to help lead the future growth of web3 gaming.

Leading cryptocurrency exchange Gemini has decided to halt its operations in the Netherlands, citing mounting regulatory hurdles imposed by the Dutch central bank De Nederlandsche Bank (DNB).  The move follows the footsteps of Binance, another digital asset trading platform that withdrew from the market earlier this year due to similar regulatory constraints.

In an emailed statement addressed to its Dutch users on September 26, Gemini conveyed its intention to suspend its services in the Netherlands, effective November 17, 2023.

 

Gemini to Exit Netherlands Due to Regulatory Pressure

Gemini explained in the email that the decision was influenced by stringent requirements imposed by the country’s central bank, DNB, on crypto exchanges.

However, the company plans to return to the Dutch market once it achieves full regulatory approval from the appropriate authorities in compliance with the new European law on cryptocurrencies, the Markets in Crypto-Assets Regulation (MiCA).

“Gemini continues to be committed to working collaboratively with regulators around the world and is focused on getting our business ready to be fully compliant with the new EU rules on crypto-assets, as set out under the Markets for Crypto-Assets Regulation (MiCA), whereby we hope to be able to offer crypto-asset services to customers based in the Netherlands in the future.”

 

Gemini Users Have until November 17 to Exit the Platform

The New York-based exchange has requested users to start withdrawing their assets on the platform as the exchange will completely shut down operations on November 17.

“We kindly ask you to proceed in emptying your Gemini account and ensuring that you no longer have a balance on your account as of November 17, 2023. We thank you for your support over the years and hope you understand our direction,” wrote the company.

To enable the safe transfer of funds, the company suggested that users move their assets to the local exchange Bitvavo, which is duly registered under the DNB jurisdictions as a crypto exchange.

However, users are not limited to Bitvavo as the exchange has encouraged its Netherlands customers to choose any preferred platform or wallet for the transfer.

 

Crypto Regulatory Landscape in the Netherlands

The Netherlands took the lead among European Union member states by mandating that crypto companies adhere to the 5th Anti-Money Laundering Directive (5AMLD). Under these regulations, Virtual Asset Service Providers (VASPs) had to furnish identifying information about themselves and their customers.

In November 2020, the country required VASPs to gather additional information before finalizing any transactions. This included verifying beneficial ownership and providing proof of ownership of a Bitcoin wallet.

However, in May 2021, the requirement was rescinded. DNB reportedly recognized the necessity of adopting a more risk-based approach to Anti-Money Laundering (AML) compliance.

The Dutch regulatory landscape for cryptocurrencies became notably rigorous when Binance withdrew its services from the country in July. Binance’s exit was driven by its inability to obtain a VASP license from the DNB, which serves as proof of compliance with the established AML protocols in the country.

Earlier this year, in January, the DNB fined Coinbase for operating in the country without proper authorization from the authorities. The company later obtained approval and became licensed to service its customers in the region legally.

So far, other crypto exchanges such as Crypto.com, BitPay, and eToro are licensed to operate in the country.

The Musée d’Orsay, home to the world’s most extensive collection of impressionist and post-impressionist masterpieces, has embarked on an innovative journey to engage a broader and younger audience by delving into the world of non-fungible tokens (NFTs) and blockchain technology. The move comes after the museum faced challenges in attracting visitors during the uncertainties of the Covid-19 pandemic.

In 2021, d’Orsay grappled with a decline in attendance as the pandemic imposed lockdowns and restrictions. Guillaume Roux, the museum’s director of development, expressed concerns about the decreasing numbers of French and young visitors.

“French people came less, young people came less. We realized that we would have to fight to gain back visitors we had lost,” he told Decrypt.

 

Musée d’Orsay Joins the Crypto Bandwagon

That same year, the French museum welcomed a new president, Christophe Leribault, who made it his mission to make the Orsay accessible to a broader and younger demographic. He recognized the potential of blockchain and NFTs, which were causing ripples of excitement in the art world, as a means to breathe new life into the institution.

Fast forward nearly two years, and the Musée d’Orsay has announced a groundbreaking partnership with the Tezos Foundation, the brains behind the creation of the Tezos blockchain. The year-long collaboration aims to bring blockchain-backed artwork and digital artists into dialogue with the museum’s vast collections and exhibitions.

To kickstart this partnership, the museum is set to offer on-chain digital souvenirs to visitors attending the forthcoming exhibition, “Van Gogh in Auvers-sur-Oise: The Final Months”, opening on October 3, 2023.

 

The upcoming exhibition will showcase the works of Vincent van Gogh during the last two months of his life, offering a unique glimpse into his creative genius.

According to a Decrypt report, museum visitors and art enthusiasts can purchase two digital souvenirs associated with the exhibition starting next week. The first is an augmented reality piece representing van Gogh’s final palette. At the same time, the second is an original digital artwork inspired by van Gogh, created by Keru, a French blockchain culture project.

These pieces will be minted on the Tezos blockchain, and they come with gamified elements that offer the chance to win prizes, including lifetime passes to the Musée d’Orsay and invitations to its grand opening events. A total of 2,300 NFTs of each variety will be available for €20 (about $21) each.

 

Musée d’Orsay to Invite Blockchain Artists for Work Opportunities

In addition to these digital initiatives, d’Orsay and the Tezos Foundation will collaborate on a series of conferences and educational programs over the next year. The programs aim to introduce museum visitors to emerging technologies, including blockchain.

Furthermore, the museum intends to invite digital artists who work with blockchain to create NFT collections inspired by its permanent collection of art pieces, a venture mirroring the ongoing initiative at the Los Angeles County Museum of Art (LACMA).

Valerie Whitacre, head of art at Trilitech, the London-based adoption hub of Tezos collaborating with Musée d’Orsay, said that the museum’s experimentation with crypto art aligns with its historic role as a collector of artists who often challenged traditional norms.

“There is Something to Gain for Both Worlds. The Musée d’Orsay has a long lineage of collecting artists that traditionalists might not have otherwise accepted. And there is a beautiful sentiment from the team there that experimenting with crypto art, experimenting with how one can engage audiences that are consuming art in a new way, relates to the overall history of the museum,” said Whitacre.

The museum’s director of development, on the other hand, emphasized the importance of adapting to the times, stating:

“Today, it’s not a question of the number of people we can bring to the museum; it’s a question of being a museum that is conscious of its time, a question of being a museum that is speaking to new generations.”

Bybit, one of the world’s leading crypto exchanges, has taken a bold step by introducing Perp Protect, an industry innovation tool poised to reshape the way traders safeguard their investments.

 

The Birth of Bybit Perp Protect

 

Bybit, a platform known for its commitment to providing traders with cutting-edge features, has developed Perp Protect as a response to the challenges faced by crypto traders. Traditional risk management strategies often require complex calculations, manual execution, and deep market knowledge, making them daunting for many traders.

Perp Protect aims to simplify this process by offering an intuitive and automated solution. One of the standout features of Perp Protect is that it is exclusively available on Bybit, setting it apart from other top crypto exchanges. This exclusivity underscores Bybit’s dedication to providing its users with tools and features that are not only innovative but also unavailable elsewhere in the market.

 

Ben Zhou, co-founder and CEO of Bybit, emphasized the importance of providing traders with tools that enhance their experience and mitigate the risks associated with the dynamic crypto market.

 

He stated:

“With Perp Protect, we are proud to offer a solution that brings ease and security to traders of all levels.”

This statement reflects Bybit’s commitment to fostering a safer and more accessible trading environment for its users.

 

Benefits of Perp Protect

 

Bybit noted that traders anticipating market volatility can leverage Perp Protect to secure their positions, giving them a proactive edge in navigating turbulent market conditions. Simply put, this tool empowers traders to stay ahead of the curve and make informed decisions.

Perp Protect operates by automatically acquiring options contracts to hedge both long and short positions. Its primary purpose is to suggest options contracts that protect against adverse price movements, ensuring that traders can safeguard their positions while staying true to their investment strategies.

 

One of the standout features of Perp Protect is its user-friendliness. Using this tool requires just two clicks, making it accessible to traders of all experience levels. Bybit has prioritized user convenience, ensuring that the benefits of Perp Protect can be accessed effortlessly. This is a critical aspect of its appeal, as crypto trading can be complex, and traders appreciate tools that simplify the process.

 

Additionally, Perp Protect’s intelligent algorithm continuously evaluates market conditions to offer optimal downside protection. Importantly, this protection comes at a cost as low as 2% of a user’s initial margin. This cost-effectiveness makes it an attractive option for traders looking to manage their risk without eating into their potential profits.

It is worth mentioning that the launch of Perp Protect comes only days after Bybit announced TradeGPT, an Artificial Intelligence (AI) tool that combines ChatGPT’s language model with real-time data to provide market insights and user support. This demonstrates Bybit’s dedication to providing traders with a seamless trading experience on its platform.

Bybit, a prominent crypto exchange remains steadfast in its commitment to stay in the United Kingdom with CEO Ben Zhou reiterating that “leaving the UK is not part of our current strategy”.

 

The New Regulatory Landscape in the UK

 

Crypto has been the subject of intense scrutiny by regulatory authorities around the world. The UK is no exception, and its Financial Conduct Authority (FCA) has been actively working to establish a regulatory framework for the crypto industry. One notable change on the horizon is the overhaul of rules governing financial promotions, which will take effect from October 8.

 

The FCA’s financial promotions rules will encompass crypto companies, potentially impacting their ability to reach local customers. To promote transparency and protect consumers, these rules necessitate that any company engaging with UK clients must be registered or authorized by the FCA.

The FCA’s new rules include a ban on crypto derivatives and Exchange-Traded Notes (ETNs) for retail consumers. These derivatives and ETNs are known for their high volatility and risk, and the FCA believes that banning them will protect retail investors from potentially catastrophic losses.

The enforcement of these rules has already influenced some companies, including Luno and American payments giant PayPal Holdings Inc (NASDAQ: PYPL) which extended its crypto trading services to the country a few years back to suspend specific crypto operations in the UK. The challenge lies in aligning their operations with the new regulations without compromising their service quality or withdrawing from the market altogether.

 

While this move is seen as a positive step towards reducing the risk of consumer harm, it has also raised concerns within the industry about the potential impact on crypto businesses.

 

Bybit Exchange’s Ongoing Commitment to Stay in the UK

 

Bybit’s initial comment about potentially withdrawing from the UK stirred discussions, but CEO Ben Zhou has since clarified the exchange’s stance. The exchange is determined to navigate these regulatory changes while staying operational in the country.

 

Zhou emphasized the exchange’s proactive engagement with regulators, underlining its efforts to identify the best path forward within the regulatory framework. Zhou stated, “There are still several avenues available for crypto exchanges to achieve compliance with UK regulators in the future, and we are actively exploring all options for this market.”

Bybit’s approach is grounded in cooperation and compliance, seeking to create a harmonious relationship with UK regulators and authorities. Such collaborations can help ensure the exchange’s full compliance with the evolving regulatory landscape.

 

These partnerships and consultations are strategic moves designed to align Bybit’s operations with local expectations and regulatory requirements.

By actively engaging with local businesses and assessing potential collaborations, Bybit aims to secure its position in the UK market and provide UK customers with a compliant and trustworthy platform for their cryptocurrency needs.

In a surprising move, Bitwise, an asset management company based in San Francisco, has decided to withdraw its application for the Bitcoin (BTC) and Ethereum (ETH) Market Cap Weight Strategy Exchange-traded fund (ETF) filed with the United States Securities and Exchange Commission (SEC) last month.

 

The decision by Bitwise comes as a surprise, especially given the recent optimistic sentiment surrounding Grayscale’s victory against the SEC. BTC had a really good day on Tuesday, surging to over 7% to reach $27,851.82 and breaking above its 200-day simple moving average after a court ruled that the SEC made a mistake by rejecting Grayscale’s request to change its bitcoin trust into an ETF.

 

Bitwise Withdraws Bitcoin ETF Application

 

However, Bitwise has decided to take a step back and reconsider its strategic approach. According to the ETF withdrawal statement released on August 31, the company emphasized the fund’s objective of providing investors with capital appreciation while acknowledging the inherent uncertainty associated with such investments. The US-based asset manager noted that it does not intend to continue the pursuant of the fund.

 

“The Trust no longer intends to seek the effectiveness of the Fund, and no securities of the Fund were sold, or will be sold, pursuant to the above-mentioned Post-Effective Amendment to the Trust’s Registration Statement.”

 

In an interview with Bloomberg on Thursday, Bitwise’s chief investment officer, Matt Hougan, urged the security watchdog to approve all ETFs submitted to its jurisdiction.

 

“If you look back at the history of the SEC’s treatment of ETFs, you can see examples of each, so we have no idea their plans. On behalf of investors, the best outcome is likely to line up multiple ETFs and allow them to launch at once.”

 

Recall that many companies in the United States, including Bitwise, ProShares, WisdomTree, BlackRock, VanEck, and Valkyrie, have applied for ETFs with the SEC, of which Bitwise has pulled the plug on its application. The funds aimed to invest in either BTC  futures contracts or ETH futures contracts, with the choice between the two determined by market capitalization.

 

Before the recent withdrawal, Bitwise had previously collaborated with ProShares to launch another ETF.

 

SEC Rejects Bitwise Bitcoin ETF Application

 

Bitwise was among the early pioneers to submit Bitcoin ETF applications to the SEC. In January 2019, the company proposed a BTC-backed ETF to track the Bitwise Bitcoin Total Return Index, which calculates Bitcoin’s value based on transactions occurring on various exchanges. The asset management firm planned to source market data from multiple crypto exchanges to represent the broader digital asset market. Additionally, Bitwise intended to employ third-party custodians to hold its Bitcoin at the time.

 

However, that same year, the SEC rejected the application due to failure to meet legal prerequisites to prevent market manipulation and other unlawful activities.

 

In that very year, Bitwise published a report about exchange volume, asserting that 95 percent of BTC’s trading volume was counterfeit. The company presented this argument to persuade the SEC to approve the ETF proposal in court. Despite the SEC’s initial rejection in October, the regulator later reconsidered their decision.

 

Meanwhile, the company’s recent ETF withdrawal is not its first. Earlier this year, the asset manager submitted an application for an Ethereum Strategy ETF designed to invest in both front-time and back-time Ethereum futures. However, the firm withdrew the application a week later, marking another twist in their regulatory journey.

 

SEC Delays Decision on ETF Application

 

With the Bitwise ETF application gone, the crypto community is now awaiting the SEC’s decision on the remaining applications by WisdomTree, Invesco Galaxy, Valkyrie, VanEck, and Fidelity.

According to a Coinspeaker report, the financial regulator has been actively reviewing the application since their submission. However, the final decision on the ETFs has been extended. The next deadline for the SEC’s decision is mid-October, but further delays are possible, extending into January or March, April, and May of next year.

The dollar eased after a brief rebound on Thursday as data showing the U.S. labor market remains strong increased chances the Federal Reserve will raise interest rates later this month.

 

Private payrolls surged in June in the biggest rise since February 2022, an ADP National Employment report showed, while the number of Americans filing new claims for unemployment benefits rose moderately last week, the Labor Department said.

 

Later, a survey by the Institute for Supply Management (ISM) showed the U.S. services sector grew faster than expected in June as new orders picked up, adding to data indicating a resilient economy in the face of tighter monetary policy.

 

"This strong data today has a lot more of a 'good news is bad news' type feel to it," said Brian Daingerfield, head of G10 FX strategy at NatWest Markets in Stamford, Connecticut.

 

"Take it together with how equity markets have responded, that gives a clear picture of the dollar today. Call it a risk-off style move, where the Fed is going to be tightening more and that has negative repercussions for risk."

 

Futures markets raised the probability of the Fed hiking interest rates by 25 basis points to 92.4% when policymakers conclude a two-day meeting on July 26, the CME Group's FedWatch Tool showed.

 

The yield on two-year Treasuries rose above 5% to their highest in 16 years, while U.S. stocks tumbled on the outlook that rates will stay higher for longer.

 

The dollar index, measuring the U.S. currency against six others including the euro and Japan's yen, fell 0.23% to 103.13.

 

ISM showed a measure of prices paid by businesses fell to more than a three-year low, suggesting inflation would continue to cool, but Fed officials again signaled higher rates ahead.

 

Dallas Fed President Lorie Logan said she was very concerned "whether inflation will return to target in a sustainable and timely way."

 

The major central banks for the most part are fine-tuning monetary policy, and it is unclear when they will act as they alternate between hiking and pausing interest rates, said Brad Bechtel, global head of FX at Jefferies.

 

"Given all these central banks are more or less in the same place in some way, shape or form, the dollar's going have a hard time" moving too much one way or the other, he said.

 

The dollar slipped 0.37% against the safe-haven Japanese yen to 144.11 as concerns about the global growth outlook, resulting from the aggressive monetary tightening by major central banks, weighed on risk appetite.

 

The pound hit a two-week high against both the euro and dollar as financial markets bet the Bank of England will raise rates to 6.5% early next year, pushing the yield on the two-year UK government bond to its highest since June 2008.

 

"The FX market is taking more of a 'one-dimensional approach' to trading the British disease," said Stephen Gallo, global FX strategist at BMO Capital Markets. "Instead of selling GBP in anticipation of an economic slowdown, it is buying GBP on the basis of interest rate differentials," Gallo said.

 

The Chinese yuan last traded down 0.084% to 7.2548 per dollar in the offshore market, a day after falling about 0.4%.

 

The central bank set a stronger-than-expected midpoint fixing for the fourth straight day this week, which traders believe is an attempt to prevent the yuan from weakening too fast and too far.