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Author: Aislinn Keely
A safe harbor for token offerings doesn’t seem to be on the horizon under the current U.S. administration.
At a Securities and Exchange Commission (SEC) event on October, Commissioner Caroline Crenshaw pushed back against calls for a safe harbor that would protect initial coin offerings (ICOs) from the SEC’s full reporting regime.
“Instead of a harbor, my hope is that we can build a bridge,” Crenshaw said, ultimately defining such a bridge to mean more crypto industry players coming to the SEC’s door.
“Had a safe harbor been in place during the Initial Coin Offering or ICO boom of 2017 and 2018, I think the results would have been even worse for investors and the markets. ICOs and other digital asset offerings raised billions from investors, but most never delivered on their promises,” said Crenshaw.
Crenshaw joined the commission in 2020, making her the newest addition to its leadership other than Chairman Gary Gensler, who has notably pushed more of the crypto industry to register with the SEC since his confirmation in April.
A safe harbor for token offerings has been a signature proposal during Commissioner Hester Peirce’s term at the SEC, even showing up in recent legislation from Representative Patrick McHenry that looks to make the decision into statute, which, if passed into law, overrides SEC rulemaking.
Support for such a safe harbor is clearly falling along partisan lines. Gensler and Crenshaw are both democrats; Peirce and McHenry, republicans. Considering the lack of bipartisan support, any such proposal is unlikely to move forward under the current Congress and administration. Crenshaw echoed Gensler’s sentiments that more crypto projects need to be registering with the SEC:
“It turns out, few digital assets projects have gone through the registration process. Many operate as if they are not subject to regulatory oversight. The result? Often digital asset investors have no way to determine if the prices and market they see is the product of manipulative trading, or if they have received sufficient disclosures about their investment to accurately price for risk.”
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Kollen Post
The growth of private capital markets in recent decades is an issue that calls for greater transparency, at least according to one leader of the Securities and Exchange Commission (SEC).
In an October 12 speech, SEC Commissioner Allision Herren Lee called out the increase in private capital — and said the rise of crypto-related “unicorns” reflects the trend.
Since 2009, private capital raises have exceeded public raises. The situation has resulted in the growing number of “unicorns,” a term that refers to private companies with valuations of over $1 billion. Lee called unicorns “a new, but no longer rare or mythical, kind of business.”
“Despite their outsize impact, there is little public information available about their activities,” she continued. “Although some of these large firms are subject to industry-specific regulation, such regulation may be quite sparse (as with the growing number of crypto-related Unicorns) or does little to address financial transparency.”
Indeed, the past year has seen a wild surge in private investment in cryptocurrency firms, according to The Block Research. In just the past 24 hours, The Block has reported on four separate fundraises for private crypto firms that would value them at over $1 billion.
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Kollen Post
The payment processing firm Stripe is looking for four engineers to form a new crypto-focused team.
Stripe’s head of crypto engineering, Guillaume Poncin, announced the hiring search on Twitter Tuesday. ”We’re starting a new crypto team at @Stripe. I’m hiring engineers and designers to build the future of Web3 payments,” wrote Poncin.
The hiring move comes two years after Stripe’s CEO Patrick Collison said he was “very skeptical” of cryptocurrency. Stripe follows a growing number of traditional finance firms eyeing potential opportunities in the crypto market.
The engineering team will “lay the foundation to support and inform Stripe’s crypto strategy,” according to the job post, and will affect everything from Stripe’s user interface to its backend operations and even its payment and identity systems.
The positions are limited to engineers based in the United States, who must also have a background developing in the crypto space in addition to more than 10 years of experience as an engineer.
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: MK Manoylov
The Bored Apes have moved from their yachts to the Hollywood spotlight.
Yuga Labs, the creator of Bored Ape Yacht Club (BAYC) — one of the most popular non-fungible token (NFT) projects — has signed on with Gary Oseary, founder of the media manager Maverick. The firm represents popular artists such as Madonna, Britney Spears, Doja Cat, Kim Petras, The Weeknd and Madonna.
“Many people still have not heard of Yuga, yet they are one of the highest-grossing talents of the year from any artform, including music and film,” said Guy Oseary in a statement. “The Apes at Yuga Labs and I have a lot of exciting initiatives for the community and we look forward to sharing them soon.”
BAYC is the second NFT project to sign with mainstream Hollywood representation this year, following CryptoPunks creators Larva Labs signed with the major talent representative United Talent Agency in late August of 2021.
Oseary’s interest in BAYC is another sign that NFTs are moving away from an internet niche and toward mainstream adoption.
Launched in April of this year, BAYC is one of the largest NFT projects by trading volume. This collection of 10,000 algorithmically generated apes traded $132.24 million during its peak sales in August, The Block’s data shows. The project currently has a floor price of 37 ETH (~129,000) on the NFT marketplace OpenSea.
BAYC has also seen success on traditional marketplaces. In September, a collection of the artwork exceeded price expectations during a sale with the art auction house Sotheby’s.
“We’re excited to work with Guy Oseary to bring the Bored Ape Yacht Club to a broader sphere,” said Yuga Labs in a statement. “We have many ambitious projects in the works and we’re thankful to have Guy’s expertise as we move the club into this new chapter, for the benefit of the entire BAYC community.”
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: MK Manoylov
13Coinbase is breaking into the market for non-fungible tokens, announcing Tuesday the waitlist for access to Coinbase NFT — making it the latest crypto firm to dive into the speculative frenzy.
The new offering — which is being spearheaded by Coinbase’s VP of Product, Sanchan Saxena — will allow users to mint, purchase, and showcase NFTs. To start it will support Ethereum-based NFTs, but it has plans to expand to other chains after it launches.
Coinbase NFT
“Our ambition with Coinbase NFT is to allow everyone to benefit from their creative spark; to contribute to a future where the ‘creator economy’ isn’t a small subset of the ‘real’ economy, but a central driver,” Coinbase said in marketing materials.
According to a spokeswoman, the platform will utilize self-custody wallets, and as a result will not require users to go through KYC checks with the exchange in the same way that its brokerage clients need to in order to trade crypto. The firm would not disclose fees, but plans to share those details closer to the official launch of the platform.
NFTs have become the zeitgeist of the crypto market, with headline-making NFTs like Beeple selling for tens of millions of dollars. That excitement has cooled recently, with weekly NFT trade volumes coming down significantly from their peak, data from The Block shows.
Competition is heating up
Coinbase is throwing its hat into a ring that’s growing more competitive. Crypto exchange FTX.US announced on Monday the fully fledged launch of its marketplace for Solana-based NFTs, as The Block reported.
Binance also has its own offering named Binance NFT, which the firm aims to build into “the largest NFT trading platform in the world.”
It makes sense that exchanges want a piece of the non-fungible action. OpenSea, which clinched unicorn status in a recent funding round, has seen its volumes surge as users have flocked to its platform to flip CryptoPunks and Pudgy Penguins.
Data from The Block shows OpenSea saw more than $2.7 billion in NFT trading volumes last month. While that’s a fraction of the $129 billion Coinbase saw in crypto spot trading in September, OpenSea’s volumes have increased more than 30 times.
FTX.US’ Brett Harrison thinks the NFT marketplace will have a meaningful impact to the firm’s bottom line.
“We think it will make a meaningful impact on our bottom line over time as volume picks up on FTX US and in Solana NFTs in general, and especially when we add support for Ethereum NFTs,” he said in a message to The Block.
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Frank Chaparro
SheeldMarket, a licensed crypto prime broker based in France, has raised $10 million in a Series A funding round.
London-based venture capital firm Atomico led the round, with Semantic Ventures, also based in London, participating. Angel investors, including Ledger CEO Pascal Gauthier, and Alexis Bonillo, co-founder of social map app Zenly, which was recently acquired by Snapchat, also backed the round. All existing investors joined the round too.
As part of the deal, Atomico partner Siraj Khaliq has joined SheeldMarket’s board of directors.
With fresh capital at hand, SheeldMarket plans to grow its platform to offer access to derivatives trading and permissioned DeFi protocols such as Aave Arc. “Since we are a broker under regulatory supervision, we cannot trade directly with non-permission DeFi protocols as there is no KYC,” SheeldMarket CEO Oliver Yates told The Block.
SheeldMarket is regulated by the French financial regulator AMF. It currently provides institutional investors access to crypto spot trading. Its clients include crypto hedge funds, blockchain or DeFi foundations, and fintechs looking to embed crypto into their offering, said Yates.
To expand its operations, SheeldMarket is also looking to double its current team of 17 in the coming months, said Yates.
The Series A round brings the firm’s total funding to date to $11 million. Last year, SheeldMarket raised $1 million in seed funding co-led by Draper Dragon and Axeleo Capital.
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Yogita Khatri
Crypto lending firm Celsius Network has raised more than $400 million in a funding round led by growth equity firm WestCap, the company announced Tuesday.
The raise—which values the firm at $3 billion—has closed as state regulators across the US are scrutinizing the company’s offerings. In September, New Jersey’s securities regulator ordered crypto lending platform Celsius to halt offerings of its interest accounts in the state. Subsequently, regulators in Texas, Alabama and Kentucky launched inquiries or ordered similar halts.
That scrutiny hasn’t appeared to halt Celsius growth, with the firm reporting more than $25 billion assets under its stewardship.
“We are pleased by the response we received from many leading financial investors during this fundraise. The partnership with WestCap and CDPQ puts Celsius in a position to grow and further its mission to leverage blockchain technology to connect and decentralize the traditional finance,” commented Alex Mashinsky, CEO of Celsius Network.
With fresh capital in hand, Celsius plans to expand its team from 486 employees to more than 1,000, according to a release. It also plans to make “strategic acquisitions.”
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Frank Chaparro
Lord Philip Hammond, the United Kingdom’s former Chancellor of the Exchequer, has warned that the nation’s finance sector is at risk of falling behind global rivals unless regulators do more to help firms embrace digital assets.
In a written interview with The Block, Hammond said that the dialogue among U.K. policymakers needs to shift “from talking about digital assets to implementing a legal framework that enables firms to embrace them.”
Regulators in Switzerland, Germany, Canada, the United States, Singapore and elsewhere are already exploring ways to do this, said Hammond.
“The U.K. is stuck talking about it, while others are doing it. This is a huge risk to the future success of the nation’s financial services sector,” he added. “As Britain grapples with the question of how to maintain its position as a global financial services position, post-Brexit, we must seize the opportunity that the digital revolution presents.”
Hammond has just taken a position as a senior advisor at Copper, the London-based crypto custodian catering to institutional investors that closed a $75 million Series B raise from investors including British billionaire Alan Howard earlier this year.
The Conservative Party politician — who served as Chancellor from 2016 to 2019 — will provide strategic advice to Copper as it expands internationally, as well as promoting the U.K. as a digital assets hub.
The U.K., and London in particular, has long been viewed as an attractive location to set up and run fintech startups. Hammond’s predecessor as chancellor, George Osborne, set up the lobby group Innovate Finance in 2015 to help boost a sector that went on to produce more than a dozen unicorns, privately-held startups with billion dollar valuations.
But the impact of Brexit coupled with regulatory constraints for crypto firms — including banning the sale of crypto derivatives to retail investors and an unwieldy anti-money laundering registration process — has led some crypto entrepreneurs to lose faith in the U.K.
Peter Smith, co-founder and CEO of $5.2 billion crypto wallet Blockchain.com, recently said that London’s reign as fintech capital is “definitely over.”
Hammond, however, is optimistic that a comeback could be on the cards.
“The U.K., and London specifically, has a strong track record of embracing change to financial services. It’s what made the City what it is. Now we’re at risk of losing that edge to jurisdictions with more proactive legislative and regulatory environments for fintech innovation,” he said. “Working with Copper, I hope to demonstrate both domestically and abroad that London not only still has what it takes to dominate in this space, but that it is indeed setting the standard for how financial instruments could, and should, be securely transacted using DLT.”
Underpinning Hammond’s work at Copper is a belief in the transformative potential of the technology underpinning cryptocurrencies.
“Our current system isn’t broken, it’s just massively inefficient,” he said, adding that companies and their customers bear the cost of that inefficiency. Hammond believes that the benefits of blockchain technology — namely, instant settlement and an immutable public record of transactions — will pave the way for faster access to financial services and real-time regulation.
Hammond said it is “too early” to forecast the usefulness of blockchain technology as the foundation for more recent innovations, like decentralized finance applications and non-fungible tokens. But he added that the transformative effects of “disintermediating the lending process” — cutting out intermediaries — are clear.
“What I will also say is that it’s very exciting to see that the innovation doesn’t stop with financial services; other verticals are driving change and exploring how the speed and security of blockchain-enabled ecosystems can broaden access and promote change,” Hammond added.
Lobbying work by former politicians on behalf of fintech firms has come under the microscope in the U.K. recently.
Former Prime Minister David Cameron has been heavily criticised for his efforts to open doors for the since-collapsed supply chain finance firm Greensill Capital during the pandemic.
Hammond himself was subject to an investigation by the U.K.’s lobbying watchdog over his work for the fintech firm OakNorth, but he was cleared of breaking any rules. He told the Financial Times earlier this week that “everyone has taken on board” lessons learned from the Greensill debacle.
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Ryan Weeks
Crypto exchange operator Binance announced Tuesday that it has launched a $1 billion fund for growing the Binance Smart Chain (BSC) ecosystem.
The massive fund is divided into four categories: Talent development, liquidity incentive program, builder program, and investment and incubation program.
The talent development program is worth $100 million and is aimed at mentoring developer communities, providing academic scholarships to institutions, and supporting research and development activities around crypto and blockchain.
The liquidity incentive program is also worth $100 million and will reward liquidity providers supporting decentralized finance (DeFi) protocols built on BSC.
The builder program is worth higher at $300 million and is further divided into two sub-categories — $100 million for conducting hackathons, bug bounty and development programs, and $200 million for incubating 100 decentralized apps building on top of BSC.
The last program, the investment and incubation program, forms the larger chunk of the fund at $500 million. It aims to invest in startups across areas, including decentralized computing, gaming, metaverse, virtual reality, artificial intelligence, and blockchain-based financial services.
“BSC’s growth has attracted 100M+ DeFi users with just an initial funding of $100 million.” said Binance CEO Changpeng “CZ” Zhao. “With the new contribution of $1B, it can disrupt traditional finance and accelerate global mass adoption of digital assets to become the first-ever blockchain ecosystem with one billion users.”
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Yogita Khatri
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