Lee and Jimmie discuss PayPal‘s proposed stablecoin and new guidance issued by the Federal Reserve that applies to bank’s engaged in crypto activity. They also provide an update on key pieces of crypto legislation and crypto litigation.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links:

PayPal to Issue Dollar-Pegged Crypto Stablecoin Based on Ethereum: https://www.coindesk.com/business/2023/08/07/paypal-to-issue-dollar-pegged-crypto-stablecoin-bloomberg/

SR 23-7: Creation of Novel Activities Supervision Program: https://www.federalreserve.gov/supervisionreg/srletters/SR2307.htm

SR 23-8 / CA 23-5: Supervisory Nonobjection Process for State Member Banks Seeking to Engage in Certain Activities Involving Dollar Tokens: https://www.federalreserve.gov/supervisionreg/srletters/SR2308.htm

SEC notified Judge Torres that they intend to appeal her ruling in the Ripple case. *gov.uscourts.nysd.551082.887.0_2.pdf (courtlistener.com)

Coinbase’s motion for summary judgment in their case against the SEC. *CoinbasevSEC12_c_Motion.pdf (ctfassets.net)

Lee and Jimmie break down the recent Ripple decision in the Southern District of New York, Blackrock CEO Larry Fink’s positive statements on crypto, and the arrest of former Celsius CEO Alex Mashinsky.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links:

Reflections on the Ripple Decision: Reflections on the Ripple Decision – The FinReg Blog (duke.edu)

THE FUTURE OF GLOBAL MONEY: HOW REAL IS THE CRYPTOCURRENCY THREAT & VALUE? (virtual panel featuring Lee and Alex Mashinsky.) https://youtu.be/FvYA8zvW1G8

Lee and Jimmie have fun with a special Independence Day-themed episode. They compare leading figures from the American Revolution to people and organizations in the world of cryptocurrency.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Lee and Jimmie break down an epic week in crypto, starting with last week’s release of a comprehensive crypto market structure bill from Republican chairmen of the House Financial Services and Agriculture committees. They then dissect the SEC’s charges against Binance and Coinbase, and the broader implications these charges will have on crypto in the U.S.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links:

SEC Files 13 Charges Against Binance Entities and Founder Changpeng Zhao: https://www.sec.gov/news/press-release/2023-101

SEC Charges Coinbase for Operating as an Unregistered Securities Exchange, Broker, and Clearing Agency: https://www.sec.gov/news/press-release/2023-102 McHenry, Thompson, Hill, Johnson Release Digital Asset Market Structure Proposal: https://financialservices.house.gov/news/documentsingle.aspx?DocumentID=408838

 

Lee and Jimmie debrief last week’s event in Washington D.C. to discuss their proposal for a fintech regulatory sandbox. Then, they discuss prospects for crypto regulation at the federal level before assessing a recently proposed crypto bill in New York. Next, Lee and Jimmie go across the pond for an update on the EU’s Markets in Crypto Assets (MiCA) regulation. They conclude by discussing the recent settlement between the SEC and a former Coinbase employee on insider trading charges.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links:

US lags in financial innovation. Regulatory sandboxes are the answer: https://www.americanbanker.com/opinion/us-lags-in-financial-innovation-regulatory-sandboxes-are-the-answer

Attorney General James Proposes Nation-Leading Regulations on Cryptocurrency Industry: https://ag.ny.gov/press-release/2023/attorney-general-james-proposes-nation-leading-regulations-cryptocurrency

Former Coinbase Manager and His Brother Agree to Settle Insider Trading Charges Relating to Crypto Asset Securities: https://www.sec.gov/news/press-release/2023-98

 

Lee and Jimmie toast the end of another academic year at Duke and discuss what’s in store for the 2023 graduates of Duke’s Masters in FinTech Engineering program. They then reflect on the impact of Bitcoin transaction fees surpassing the block mining reward before previewing their May 23rd event in Washington DC that will highlight their regulatory sandbox proposal. They end by discussing the diminishing outlook for stablecoin legislation and the politicization of central bank digital currency.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links:

US lags in financial innovation. Regulatory sandboxes are the answer: https://www.americanbanker.com/opinion/us-lags-in-financial-innovation-regulatory-sandboxes-are-the-answer

House Republicans and Democrats can't agree on how to regulate stablecoins: https://finance.yahoo.com/news/house-republicans-and-democrats-cant-agree-on-how-to-regulate-stablecoins-170039086.html?guccounter=1&guce_referrer=aHR0cHM6Ly90LmNvLw&guce_referrer_sig=AQAAAKjY-iC7dW921Z31Ims-haRpC8tbniJcyQfB0wbC80L1snPM6xFESeeSGPwl5ZC2hApU4W8yYU9Duwi6T2v82rqEN_e67KGWnDzsEEAanTruTuX9YfGvacRn5o0FspTqJmzmTyylaQ6N-otPMKw4NEwnIQSH_eTxPXbM9WI6Y9tf

Florida’s DeSantis Waging Toothless Campaign Against Digital Dollars, Lawyers Say: https://www.coindesk.com/policy/2023/05/17/floridas-desantis-waging-toothless-campaign-against-digital-dollars-lawyers-say/?utm_medium=referral&utm_source=rss&utm_campaign=headlines

 

Lee and Jimmie discuss their recent op-ed in the American Banker that calls for the creation of a federal regulatory sandbox to promote beneficial innovation in financial services. They then debate the definition of digital asset and why it is so hard to define digital asset and cryptocurrency in law and regulation. Lee gets Jimmie’s thoughts on the role of AI in the classroom and the intersection of AI and crypto. The episode concludes with a preview of next week’s joint hearing on crypto market structure with the House Ag and Financial Services committees.

 Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links

US lags in financial innovation. Regulatory sandboxes are the answer: https://www.americanbanker.com/opinion/us-lags-in-financial-innovation-regulatory-sandboxes-are-the-answer

U.S. SEC Changes Its Mind on Officially Labeling Digital Assets: https://www.coindesk.com/policy/2023/05/03/us-sec-changes-its-mind-on-officially-labeling-digital-assets/

Jimmie debriefs his recent trip to Louisville to discuss TruckCoinSwap at the Mid America Trucking Show. Lee and Jimmie then discuss the CFTC’s remarkable complaint against Binance and what the potential fallout may be for the broader crypto market. They also highlight a new 160-page report from Citi on blockchain’s future and what the future of tokenization will look like. They end by discussing new accounting guidance from FASB that recommends companies account for crypto on their balance sheet at fair value.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links

CFTC Charges Binance and Its Founder, Changpeng Zhao, with Willful Evasion of Federal Law and Operating an Illegal Digital Asset Derivatives Exchange: https://www.cftc.gov/PressRoom/PressReleases/8680-23

MONEY, TOKENS, AND GAMES: Blockchain’s Next Billion Users and Trillions in Value: https://ir.citi.com/gps/MG9DEWhoYvQJVWLM9Kr3%2BZmqjoztKJcyNHr83F9Wug2pzAGHPQKfp23RAMrkNts%2FJitXoTNqufOvegUjjXh0IA%3D%3D?utm_source=substack&utm_medium=email

FASB Crypto Update: https://www.fasb.org/document/blob?fileName=Prop%20ASU%E2%80%94Intangibles%E2%80%94Goodwill%20and%20Other%E2%80%94Crypto%20Assets%20(Subtopic%20350-60)%E2%80%94Accounting%20for%20and%20Disclosure%20of%20Crypto%20Assets.pdf

Lee and Jimmie discuss the demise of Silicon Valley Bank and Signature Bank and the long-term implications of the policy response on risk-taking in the financial system and what it all means for crypto. They also dissect the digital assets section of the recent Council of Economic Advisors Economic Report of the President (Jimme hates it, Lee loves its). They conclude by talking about recent SEC crypto-related enforcement actions, including the SEC Wells Notice to Coinbase.

Lee’s Twitter: @leereiners

Jimmie’s Twitter: @jimmie_lenz

Related Links

Economic Report of the President: https://www.whitehouse.gov/wp-content/uploads/2023/03/ERP-2023.pdf

We asked the SEC for reasonable crypto rules for Americans. We got legal threats instead: https://www.coinbase.com/blog/we-asked-the-sec-for-reasonable-crypto-rules-for-americans-we-got-legal