Seeds of Wisdom RV and Economic Updates Monday Morning 9-23-24
Good Morning Dinar Recaps,
Ripple CLO Talks Congress Insights on SEC and XRP
▪️Professor Reiners emphasized the need for Congress to address the regulatory gap in the crypto spot market.
▪️Ripple’s argument against XRP being a security aligns with Reiners’ testimony on investment contracts.
Stuart Alderoty, Ripple’s Chief Legal Officer, has responded to Professor Lee Reiners testifying before Congress, which provided an illuminating viewpoint on the continuing legal dispute between Ripple and the United States Securities and Exchange Commission.
Reiners, known as both a pro-SEC and anti-crypto advocate, acknowledged the SEC’s recent setback in the Ripple case, underscoring three key factors with substantial significance for the crypto industry and Ripple’s journey.
Questioning the Regulatory Gaps and Decentralization in Crypto Laws
To begin, Reiners identified a significant regulatory gap in the crypto spot market, pointing out that neither the SEC nor the Commodity Futures Trading Commission (CFTC) currently regulate this sector. This observation highlights an obvious flaw in the current regulatory framework for cryptocurrency.
Reiners believes Congress should take a more active role in closing this regulatory hole. Ripple’s Alderoty agreed, emphasizing the importance of legislative action to better address the changing crypto ecosystem.
Another key argument addressed by Reiners was the concept of decentralization in relation to securities legislation. He criticized the idea that securities regulations should be predicated on a “mystical” decentralization threshold, alluding to a 2018 speech by former SEC Director William Hinman.
This statement has sparked debate within the crypto community, particularly because it hinted that certain cryptocurrencies could be immune from securities restrictions if they achieved a sufficient level of decentralization.
Reiners’ stance is consistent with the broader crypto industry, which has long stated that decentralization should not be used to determine whether an asset is a security.
Reiners also addressed the topic of investment contracts, citing analogies to the landmark Howey Test case concerning orange groves. He underlined that the object of an investment contract, such as orange groves, is not a security in and of itself. A management contract must be present when something is considered security.
This viewpoint is consistent with Ripple’s central argument that XRP should not be categorized as a security since it does not meet the criteria for being an investment contract.
The Impact of SEC Changing Leadership on Crypto Regulation
One of Reiners’ most memorable comments was that “SEC chairs come and go,” implying that regulatory landscapes might move dramatically with changes in leadership.
This insight serves as a reminder of the transient nature of regulatory interpretations, implying that Ripple’s case may result in different consequences if future SEC leadership takes a fresh perspective on cryptocurrencies.
While the crypto community eagerly monitors these events, doubt remains over XRP’s future, notably whether the SEC would appeal the Ripple case verdict before the deadline of October 7, 2024.
This lingering uncertainty is currently placing downward pressure on the XRP price, which was $0.5843 at the time of this post, representing a slightly 0.55% fall over the last 24 hours.
On the other hand, Ripple’s partner, SBI Holdings, has made substantial progress in researching the integration of token-based bank deposits with central bank digital currencies. According to a CNF report, SBI Holdings has joined Project Agora, which aims to examine how tokenized commercial bank deposits might be integrated with wholesale CBDCs on a single ledger.
@ Newshounds News™
Source: Crypto News Flash
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AUSTRALIA TIGHTENS GRIP ON CRYPTO STARTUPS WITH CORPORATE LAW CHANGES
Key Takeaways
▪️Australia wants all crypto exchanges to hold financial services licenses.
▪️The country has so far had limited success in its crackdown on the crypto industry.
▪️As of 2022, over one million Australians held at least one form of cryptocurrency.
Australia is set to further enhance the regulation of the cryptocurrency industry by requiring all crypto exchanges to hold financial services licenses.
The move will see the country’s corporate watchdog push for updated regulations to be enforced over the next two months, the Australian Financial Review reported.
Australia Tightens Grip on Crypto
The new licensing requirements are required as the Australian Securities and Investments Commission (ASIC) considers most major crypto assets to be relevant under the country’s Corporate Act, according to ASIC commissioner Alan Kirkland.
Crypto developers in the country have been confused about whether or not they should obtain an Australian Financial Services (AFS) license.
An AFS is needed for a “financial product,” which is when an individual takes on a financial risk or makes an investment.
ASIC is currently embroiled in two major court cases involving two crypto startups that have not obtained a license.
“ASIC’s message is that a significant number of crypto-asset firms in the Australian market are likely to need a license under the current law. This is because we think many widely traded crypto assets are a financial product,” Kirkland said.
ASIC Has Had Limited Success
ASIC will update its “Information Paper 225” for a November release. The regulatory paper will clarify how cryptocurrencies and other financial products should be treated.
So far, ASIC has had limited success penalizing crypto exchanges without a license.
Block Earner, an Australian crypto startup founded in 2021, was taken to court by ASIC, which alleged that the company was working unlawfully without a license. The Federal Court sided with Block Earner, claiming the startup had been operating lawfully.
ASIC sued Finder Wallet for not registering as a financial service. The court ultimately ruled that the startup did not need a license to operate.
The Australian watchdog is appealing both court decisions.
Australia and Crypto
Like the rest of the world, Australia has an evolving relationship with cryptocurrency.
In 2022, research firm Roy Morgan found that over one million Australians own at least one form of cryptocurrency, including Bitcoin, Ethereum, and Cardano.
A 2023 study by the Australian Securities Exchange (ASX) found nearly 3 in 10 Aussie investors plan to buy crypto in the next year, with 15% already holding digital assets.
However, While Australia has generally welcomed innovation in the crypto space, a strong emphasis on consumer protection has remained.
According to a Finder report powered by Coinbase, 50% of Australian owners said the security and reputation of an exchange are the most important features to them.
Last month, the Australian Competition and Consumer Commission (ACCC) found that half of crypto-related Facebook ads were scams.
The ACCC alleged that Meta was aware of crypto scams in its ads for the past six years.
“Meta has been aware that a significant proportion of cryptocurrency advertisements on the Facebook platform have used misleading or deceptive promotional practices,” the company said in a court ruling.
@ Newshounds News™
Source: CCN
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GOLD FOLLOWS BITCOIN PRICE RALLY TO NEW RECORD HIGHS, WILL MOMENTUM CONTINUE?
Inflation hedges, such as gold, have emerged as a more attractive option for diversification along with Bitcoin which is nor preparing for a mega rally in Q4.
Key Notes
▪️Gold has surged to a record high of $2,629 per ounce, gaining 5% in the past two weeks, following Fed rate cuts.
▪️Rising geopolitical risks, including conflicts in Ukraine and the Middle East have increased the appeal of gold as a safe-haven asset.
▪️Goldman Sachs forecasts further growth in gold prices, projecting a surge to $2,700 by early 2025.
The gold price has been hitting new highs following the Fed rate cut last week while following the Bitcoin price trajectory recently. Over the past week, the BTC price has surged over 8.5% moving all the way to $64,000.
On the other hand, the gold price touched a record high of $2,629 per ounce on September 23. Within the last 15 days, the yellow metal has registered strong 5% gains. The major boost comes following the 50 bps rate cut by the Federal Reserve which served as the tailwind for the yellow metal.
A decrease in interest rates diminishes the appeal of assets linked to Fed-determined returns, like short-term government bonds, while making inflation hedges, such as gold, a more attractive option for diversification.
Furthermore, the appetite for gold investments has been growing recently amid rising geopolitical risks such as the ongoing wars between Russia and Ukraine, Israel and Hamas. On the other hand, the uncertainty around the 2024 US elections is also another factor contributing to this.
Furthermore, banking giant Goldman Sachs recently reported that the gold purchases by central banks have tripled following the last two years of the Russia-Ukraine war. With more Fed rate cuts expected this year, Goldman Sachs researchers predict that the gold price will surge to $2,700 by early next year.
Gold Rally Isn’t Ending Anytime Soon
Peter Boockvar, chief investment officer at Bleakley Financial Group, noted that gold has yet to surpass its inflation-adjusted peak of $3,200, set in 1980. Meanwhile, gold advocate Peter Schiff took the opportunity to criticize digital assets in a post on X on Sept. 23. Schiff noted:
“Gold just hit another record high, but few investors notice or care. With so much attention focused on Bitcoin, investors are not only missing out on gold’s gains but the significance of the rise.”
On the other hand, Bitcoin is also showing strength gearing up for a mega rally moving ahead in Q4 2024. 10x Research founder and CEO Markus Thielen noted that the chances of a major breakout increase as we approach the October-to-March period.
“Bitcoin’s 2024 performance has once again followed its seasonal pattern – just as it did in 2023. This is why traders should anticipate a major breakout, potentially reaching new all-time highs in Q4 2024,” he added.
@ Newshounds News™
Source: CoinSpeaker
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ARE WE THERE YET ROADMAP AND TIMELINE? #rv #gcr #roadmaptosuccess | Youtube
@ Newshounds News™
Source: Seeds of Wisdom Team Currency Facts
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