FreeCryptoCurrency.Me

House Financial Services Committee Chair Patrick McHenry pushed back against criticism from bankers of stablecoin legislation he’s helped draft in a letter to the influential American Bankers Association last week. 

The ABA organized two letters last week in opposition to pieces of the stablecoin framework, expected to be debated by McHenry’s committee on Thursday. The Block obtained a copy of the North Carolina Republican’s push back to that criticism. A spokesperson for McHenry did not immediately respond to a request for comment. 

‘Disappointing’ criticism from banks

McHenry called the ABA’s criticism of a state approval process for stablecoin issuers “disappointing as it fundamentally misrepresents the text of the legislation.” 

“You and your members weighed in heavily and the committee responded, including your top priority eliminating access to the Federal Reserve’s master accounts,” McHenry continued, referring to a type of account private financial institutions can hold with the central bank. He added that stablecoin issuers would be subject to the same supervisory and enforcement standards as banks, credit unions, and trusts. 

In letters to the committee chair sent last week, the ABA, state bankers associations, and two other national trade associations criticized parts of the stablecoin bill, which McHenry has negotiated with his Democratic counterpart Rep. Maxine Waters, D-Calif., and the Biden administration. Buy-in from congressional Democrats and the administration is necessary for any legislation to have a realistic chance at becoming law.

Argues banks can benefit from bill

McHenry concluded his letter to the ABA by arguing that the trade association did not mention ways that the stablecoin bill could benefit its members. 

“Finally, your letter is silent on the policies that will benefit financial institutions included in the bill,” wrote the Financial Services Committee chair, noting that the stablecoin bill rescinds Securities and Exchange Commission guidance around custody of digital assets, and clarifies that banks can tokenize deposits if they want to. “Banks should be able to fairly compete in the blockchain ecosystem,” he added, before continuing that he wants to continue talking to the ABA about the bill. 

The stablecoin bill is expected to be debated by the committee McHenry chairs tomorrow. He and and his staff are continuing last-minute negotiations with Democrats to reach a bipartisan consensus on the bill to give it enough momentum to become law. Republicans have intentionally paired the stablecoin legislation with a related but separate effort to overhaul how cryptocurrencies are treated under U.S. financial law. That Republican-led bill has garnered less interest from Democrats, though at least three Democrats on the Financial Services Committee said on Wednesday that they plan to support the market legislation. 

© 2023 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.

In another sign of just how cold the crypto winter has become for some of the highest flying of blockchain projects, Star Atlas’ CEO took to Discord on Wednesday in an effort to gin up revenue amid a desperate search for investors.

Speaking to only a few hundred of the more than 190,000 members of Star Atlas’ Discord server, CEO Michael Wagner outlined the company’s new vision which includes focusing on cheaper-to-produce gaming projects.

Wagner said he hopes to start by rolling out a new iteration of an online browser game called Sage in about three weeks.

“This is going to be a more simplified user interface,” Wagner said. “It is a 2D environment … but again all of the real mechanics on mainnet with real economic outcomes to you guys.”

Unveiling a 2D browser game is a far cry from the high-profile 3D sci-fi game in development since 2020, which had been considered one of, if not the most ambitious crypto gaming project. Star Atlas was billed as the brand of big-budget, massively multiplayer online role-playing game capable of drawing mainstream gamers into the blockchain space.

The project has also been perhaps the most significant web3 game being developed on the Solana blockchain.

More runway and ‘golden tickets’

Now it appears, however, Wagner is hoping that with Sage, and the launch of a mobile companion game, he can reverse Star Atlas’ fortunes.

“The mobile app is, to me, an amazing opportunity to grow the user base,” he said. “From a company perspective it actually gives an opportunity to generate revenue off a new asset class, which is obviously beneficial for things like runway.”

Earlier this week, the gaming project once celebrated for selling nearly $200 million in NFTs — for items like virtual spaceships — announced it had reduced staff to a core group of 45 employees. That represents about an 80% cut when compared to last year’s peak of 235 employees.

The company also posted this week a bullet-pointed summary stating that reducing staff and focusing on cheaper gaming could help the project raise fresh capital. 

Before answering community questions and after addressing the company’s headcount reduction, Wagner opened the town-hall style discussion pitching the existing community on a “$1.5 million promo event.”

“Anybody that wants to come into this promotion will need to buy and own ships to participate,” he said before going on to describe an upcoming raffle. “We’re calling these golden tickets … and on a weekly basis you can enter into these drawings.”

© 2023 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.

Federal prosecutors asked a federal judge to detain Sam Bankman-Fried months before the former FTX CEO is set to stand trial.  

During a hearing on Wednesday in a Manhattan federal court, prosecutor Danielle Sassoon said “no set of release conditions can ensure the safety of the community,” according to Reuters. 

The request comes a week after the U.S. Department of Justice accused Bankman-Fried of leaking the private diary of a former colleague, Caroline Ellison, to the media. Ellison ran FTX’s sister trading company Alameda Research and pleaded guilty to multiple charges last year. 

Sassoon told the court on Wednesday that Bankman-Fried, who’s currently under house arrest, tried to “intimidate” Ellison and made “100 calls to the reporter of the NYT article, some for more than 20 min,” according to Inner City Press. 

Bankman-Fried faces slew of charges

Counsel for Bankman-Fried agreed that he would not talk publicly about the case but said it should be applied to “all parties and witnesses” including FTX, Alameda Research and current FTX CEO John Ray, according to a letter filed in the U.S. District Court for the Southern District of New York over the weekend. 

Bankman-Fried faces over 100 years in prison if he is convicted of a slew of charges, including fraud, over allegations that he and other FTX executives used billions of customer assets to make their own failed investments. FTX filed for bankruptcy late last year. 

© 2023 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.

Bitcoin’s price rose modestly after the U.S. Federal Reserve raised interest rates by 25 basis points, as expected. After Wednesday’s meeting of the Federal Open Market Committee, the target range for the federal funds rate is now 5.25%-5.5%.

The world’s largest cryptocurrency by market capitalization rose 0.3% to $29,354 at 2:56 p.m. in New York, according to CoinGecko. It’s stayed within a narrow range between around $29,000 and $31,500 for over a month now.

Today’s decision by the Fed marks the 11th rate hike in 17 months, after a brief pause in June. The central bank warned that inflation remains elevated and that it’s “strongly committed” to bringing it down to its stated goal of 2%. 

Additional policy firming

“In determining the extent of additional policy firming that may be appropriate to return inflation to 2 percent over time, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments,” it said in a statement. 

Fed Chair Jerome Powell said at a press conference that further rate hikes could come in September, if warranted. 

“I would also say it’s possible that we would choose to hold steady at that meeting. We’re going to be making careful assessments, as I said, meeting by meeting,” he said.

U.S. stocks were mostly muted just after the announcement, with the Nasdaq dipping 0.3%, the S&P 500 rising 0.1% and the Dow Jones Industrial Average rising 0.4%.

© 2023 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.