Binance’s CZ must stay in US, Elon Musk seeks $1B for AI, and other news: Hodler’s Digest, Dec. 3-9
Top Stories This Week
Binance founder CZ must stay in US until sentencing, judge orders
Binance founder Changpeng “CZ” Zhao has been ordered to stay in the United States until his sentencing in February, with a federal judge determining there’s too much of a flight risk if the former crypto exchange CEO is allowed to return to the United Arab Emirates. On Dec. 7, Seattle District Court Judge Richard Jones ordered Zhao to stay in the U.S. until his Feb. 23, 2024 sentencing date. He faces up to 18 months in prison after pleading guilty to money laundering on Nov. 21 and has agreed not to appeal any potential sentence up to that length.
House committee passes bill to ‘preserve US leadership’ in blockchain
A United States Congress committee has unanimously passed a pro-blockchain bill, which would task the U.S. commerce secretary with promoting blockchain deployment and thus potentially increase the country’s use of blockchain technology. The act covers an array of actions the commerce secretary must take if passed, including making best practices, policies and recommendations for the public and private sector when using blockchain tech. The bill will now go to the House for a vote. If passed, it must also pass in the Senate before returning for final congressional and presidential approval.
SEC pushes deadline to decide on Grayscale spot Ether ETF
The United States Securities and Exchange Commission has delayed its decision on whether to approve or reject a spot Ether exchange-traded fund (ETF) offering from asset manager Grayscale. In a notice, the SEC said it would designate a longer period for considering a proposed rule change that would allow NYSE Arca to list and trade shares of the Grayscale Ethereum Trust. Grayscale first filed with the SEC to convert shares of its Grayscale Ethereum Trust into a spot Ether ETF in October, adding its name to the list of companies awaiting a decision from the regulator.
Elon Musk’s xAI files with SEC for private sale of $1B in unregistered securities
Elon Musk’s X-linked artificial intelligence modeler, xAI, has an agreement for the private sale of $865.3 million in unregistered equity securities, according to a filing with the United States Securities and Exchange Commission made on Dec. 5. The company is seeking to raise $1 billion. XAI’s product, a chatbot called Grok, has recently rolled out to X’s Premium+ subscribers. Musk announced the launch of xAI in July and claimed its goal was to “understand the universe.”
Bitcoin new high set for late 2024, Binance to lose top spot — VanEck
Bitcoin will hit a new all-time high in late 2024 because of a long-feared United States recession and regulatory shifts after the next U.S. presidential election, asset manager VanEck predicts. The firm is confident that the first spot Bitcoin ETFs will be approved in the first quarter of 2024. However, it also made a gloomy prediction for the general U.S. economy. VanEck is among several firms, including BlackRock and Fidelity, that are vying for an approved spot Bitcoin ETF. VanEck also believes that the BTC halving, due in April or May, “will see minimal market disruption,” but there will be a post-halving price rise.
Winners and Losers
At the end of the week, Bitcoin (BTC) is at $44,402, Ether (ETH) at $2,364 and XRP at $0.66. The total market cap is at $1.65 trillion, according to CoinMarketCap.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Bonk (BONK) at 203.10%, ORDI (ORDI) at 134.34% and BitTorrent (BTT) at 114.32%.
The top three altcoin losers of the week are Maker (MKR) at -6.48%, UNUS SED LEO (LEO) at -6.22% and Kaspa (KAS) at 4.98%.
For more info on crypto prices, make sure to read Cointelegraph’s market analysis.
Read also
Most Memorable Quotations
“The expected approval of the ETF will be positive news for the crypto market, likely leading to significant growth.”
Adam Berker, senior legal counsel at Mercuryo
“The only true use case for it [crypto] is criminals, drug traffickers, money laundering, tax avoidance.”
Jamie Dimon, CEO of JPMorgan Chase
“Jamie Dimon is in no position to criticize Bitcoin with this sort of track record.”
Gabor Gurbacs, strategy adviser at VanEck
“So, for us, I think Bitcoin is our central bank. With that in mind, I think of Ethereum as our investment bank.”
Robby Yung, CEO of Animoca Brands
“The ETF is certainly a key driver in sentiment.”
Jon de Wet, investment chief of Zerocap
“It takes a community and the whole industry to figure out how to better educate people. That’s the hard part. It’s not a technology issue; it’s an operational problem.”
Eowyn Chen, CEO of Trust Wallet
Prediction of the week
‘Early bull market’ — Bitcoin price preps 1st ever weekly golden cross
Bitcoin is lining up an “early bull market” as a unique chart feature plays out for the first time in history.
In a post on X (formerly Twitter) on Dec. 7, entrepreneur Alistair Milne noted that should current performance continue, Bitcoin will witness a crossover of two weekly moving averages (MAs), which have never delivered such a bull signal before.
The 50-week and 200-week MAs are key trendlines for Bitcoin traders and analysts alike. The latter is the ultimate bear market support level, and it has so far never decreased in value.
BTC price strength is on the way to taking the 50-week MA trendline above the 200-week counterpart. Known as a “golden cross,” on lower timeframes, this is considered a classic bullish signal, and for Milne, the impetus is that considerable upside could be in store should the phenomenon play out.
“The 50-week moving average will now soon cross back above the 200-week MA making a ‘golden cross’ for the 1st time. QED: Early bull market,” he wrote.
FUD of the Week
Crypto is for criminals? JPMorgan has been fined $39B and has its own token
JPMorgan Chase CEO Jamie Dimon is being criticized by the crypto community after claiming Bitcoin and cryptocurrency’s “only true use case” is to facilitate crime. However, according to Good Jobs First’s violation tracker, JPMorgan is the second-largest penalized bank, having paid $39.3 billion in fines across 272 violations since 2000. About $38 billion of these fines came under Dimon’s watch, who has been CEO since 2005.
British regulator adds Justin Sun-linked Poloniex to warning list after $100M hack
The United Kingdom’s Financial Conduct Authority (FCA) has added crypto exchange Poloniex to its warning list of non-authorized companies. The Seychelles-based exchange is one of the three companies owned by or affiliated with entrepreneur Justin Sun that have suffered four hacks in the last two months. The warning to Poloniex was published on the FCA’s website on Dec. 6. It doesn’t offer a reason but says that “firms and individuals cannot promote financial services in the UK without the necessary authorization or approval.”
US senators target crypto in bill enforcing sanctions on terrorist groups
A bipartisan group of lawmakers in the United States Senate introduced legislation aimed at countering cryptocurrency’s role in financing terrorism, explicitly citing the Oct. 7 attack by Hamas on Israel. The bill would expand U.S. sanctions to include parties funding terrorist organizations with cryptocurrency or fiat. According to Senator Mitt Romney, the legislation would allow the U.S. Treasury Department to go after “emerging threats involving digital assets.”
Read also
Top Magazine Pieces of the Week
Lawmakers’ fear and doubt drives proposed crypto regulations in US
If the Digital Asset Anti-Money Laundering Act were to become law, many cryptocurrency providers would have to learn how to comply with the same regulations as traditional financial institutions.
Expect ‘records broken’ by Bitcoin ETF: Brett Harrison (ex-FTX US), X Hall of Flame
Brett Harrison taught a promising young Sam Bankman-Fried programming for traders at Jane Street, but wasn’t so impressed with the man SBF became.
Web3 Gamer: Games need bots? Illuvium CEO admits ‘it’s tough,’ 42X upside
Games overrun with bots just show bot owners care, claims Pixels founder. Plus we review Galaxy Fight Club, chat to Illuvium’s CEO and more.
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Politics
Wes Streeting denies Labour has made ‘mistakes’ with ‘unpopular’ policies despite poor local election results
Health Secretary Wes Streeting has defended “unpopular” policies such as the cut to the winter fuel allowance despite Labour’s poor performance at the local elections.
Mr Streeting denied the government had made any mistakes when asked whether the policy was partly to blame for the party losing 189 council seats less than a year since the General Election.
Since coming into government last July, Labour has enacted a number of policies that were not in its manifesto.
These include means-testing winter fuel payments for pensioners, increasing employers’ national insurance contributions and slashing £5bn from the welfare bill.
Asked what mistakes his government had made so far that had led to its drubbing at the ballot box, Mr Streeting told Sunday Morning with Trevor Phillips: “Well, we will make plenty of mistakes.”
Politics latest: Lucy Powell ‘right’ to apologise for grooming gangs comments
Pressed again on whether he believed “mistakes” had been made, the health secretary replied: “No. When we made those choices, we knew they would be unpopular. And we knew that they would be opposed.
“The reason we made those choices is because we genuinely believe they’re the right choices to get the country out of the massive hole it was left in. And right across the board. Whether it’s the NHS, whether it’s schools, whether it’s prisons, whether it’s our defence and security, whether it’s crime and policing, there were enormous challenges facing this country when we came in.
“And we’ve had to make big and sometimes unpopular decisions so that we can face those challenges and deal with them. People might thank us if we just kind of go for the easy but we want to make the right choices.”
Some Labour MPs have urged the government to change direction, with one telling Sky News the cut to winter fuel was a “catastrophic error” that must be “remedied” if the party is to see any improvement in public opinion.
Others have warned that in courting Reform voters, the party risks fracturing its coalition of voters on the left who may be tempted by the Liberal Democrats and Green Party.
However, in the aftermath of the local elections, Sir Keir Starmer suggested the poor results meant he needed to go “further and faster” in delivering his existing agenda.
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Inside Reform’s election success
The real victor to emerge from Thursday’s local elections was Reform UK, which won control of 10 councils and picked up 677 council seats largely at the expense of the Conservatives in the south.
However, Reform also won the Runcorn by-election from Labour by just six votes, as well as control of Doncaster Council from Labour – the only local authority it had control of in this set of elections – in a significant win for Nigel Farage and his party.
The Reform UK leader declared that two-party politics was now “finished” and that his party was now the official “opposition” to Labour.
Asked whether the results meant that Labour would now treat Reform as “your most serious opposition”, Mr Streeting said: ” I certainly do treat them as a serious opposition force.”
“As I say, I don’t know whether it will be Reform or the Conservatives that emerge as the main threat,” he added.
“I don’t have a horse in that race, but like alien versus predator, I don’t really want either one to win.”
Read more:
Reform’s mission to ‘remoralise’ young people
Reform has put the two traditional parties on notice
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Reform UK are ‘fighting force’
Tory Party chairman Nigel Huddleston said Reform UK was not just a protest party and that Mr Farage was “a force in British politics”.
He told Trevor Phillips: “But the one thing about Nigel Farage is, and we’re seeing this again and again and again, he is a populist.
“He is increasingly saying everything that anybody wants to hear. He’s trying to be all things to all men.”
“We are establishing ourselves as a credible alternative government based on sound conservative principles and values and our values and our principles, and therefore our policies, will define the future of our party,” he added.
Kemi Badenoch has admitted it is “feasible” that Nigel Farage could become the next prime minister.
The Tory leader told the BBC’s Sunday With Laura Kuenssberg programme Mr Farage’s party was “expressing the feeling of frustration that a lot of people around the country are feeling” – but added it was her job to “come up with answers and solutions”.
Asked if it was feasible that Mr Farage could be the next prime minister, she cited how Australian Prime Minister Anthony Albanese had won re-election this weekend.
“As I said, anything is feasible,” she said. “Anthony Albanese: people were writing him off. He has just won a landslide, but my job is to make sure that he [Farage] does not become prime minister because he does not have the answers to the problems the country is facing.”
Politics latest: Lucy Powell ‘right’ to apologise for grooming gangs comments
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Could Nigel Farage be prime minister?
Asked what Mr Farage was doing right, Ms Badenoch said: “He is expressing the feeling of frustration that a lot of people around the country are feeling.
“But he also doesn’t have a record in government like the two main parties do. Now he’s going to be running some councils. We’ll see how that goes.”
Mr Farage was the undoubted winner of Thursday’s local elections, in which 23 councils were up for grabs.
His party picked up 677 council seats and took control of 10 councils.
By contrast, the Conservatives lost 677 council seats as well as control of 18 councils in what was their worst local elections performance on record.
Mr Farage said the outcome spelt the end of two-party politics and that his party was now the official “opposition” to Labour – with the Tories having been rendered a “waste of space”.
Read more:
Reform has put the two traditional parties on notice
‘I get it’: Starmer responds after losing Runcorn by-election
Ms Badenoch said she believed the vote for Mr Farage on Thursday was partly down to “protest” but added: “That doesn’t mean we sit back. We are going to come out fighting.
“We are going to come out with the policies that people want to see, but what we are not going to do is rush out and tell the public things that are not true just so we can win votes.
“This is not about winning elections; this is about fixing our country. Yes, of course, you need to win elections to do that, but you also need a credible plan.”
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‘Farage is a force in British politics’
Conservative co-chairman Nigel Huddleston sought to play down the threat from Reform UK, telling Sky News: “When they’re in a position of delivering things, that’s when the shine comes off.”
He told Sunday Morning with Trevor Phillips: “The one thing about Nigel Farage is, and we’re seeing this again and again and again, he is a populist.
“He is increasingly saying everything that anybody wants to hear. He’s trying to be all things to all men.”
“We are establishing ourselves as a credible alternative government based on sound conservative principles and values and our values and our principles, and therefore our policies, will define the future of our party,” he added.
Asked whether the results meant that Labour would now treat Reform as “your most serious opposition”, Health Secretary Wes Streeting told Trevor Phillips: ” I certainly do treat them as a serious opposition force.”
“As I say, I don’t know whether it will be Reform or the Conservatives that emerge as the main threat,” he added.
“I don’t have a horse in that race, but like alien versus predator, I don’t really want either one to win.”
A group of US Senate Democrats known for supporting the crypto industry have said they would oppose a Republican-led stablecoin bill if it moves forward in its current form.
The move threatens to stall legislation that could establish the first US regulatory framework for stablecoins, according to a May 3 report from Politico.
Per the report, nine Senate Democrats said in a joint statement that the bill “still has numerous issues that must be addressed.” They warned they would not support a procedural vote to advance the legislation unless changes are made.
Among the signatories were Senators Ruben Gallego, Mark Warner, Lisa Blunt Rochester and Andy Kim — all of whom had previously backed the bill when it passed through the Senate Banking Committee in March.
The bill, introduced by Senator Bill Hagerty, is formally known as the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act.
Related: Fed’s Powell reasserts support for stablecoin legislation
Senate prepares to vote on stablecoin bill
The Senate is expected to begin floor consideration of the bill in the coming days, with the first vote potentially taking place next week.
The bill has been championed by the crypto industry as a landmark step toward regulatory clarity. However, the Democrats’ about-face reflects growing unease within the party.
Although revisions were made to the bill after its committee approval to address Democratic concerns, the lawmakers said the changes fell short. They called for stronger safeguards related to Anti-Money Laundering, national security, foreign issuers, and accountability measures for noncompliant actors.
The statement was also signed by Senators Raphael Warnock, Catherine Cortez Masto, Ben Ray Luján, John Hickenlooper and Adam Schiff.
Senator Kirsten Gillibrand and Senator Angela Alsobrooks were absent from the list, who co-sponsored the bill alongside Hagerty.
Despite their objections, the Democratic senators emphasized their commitment to shaping responsible crypto regulation. They reportedly said they “are eager to continue working with our colleagues to address these issues.”
Related: US banks are ‘free to begin supporting Bitcoin’
Crypto needs a stablecoin bill
On April 27, Caitlin Long, founder and CEO of Custodia Bank, criticized the US Federal Reserve for quietly maintaining a key anti-crypto policy that favors big-bank-issued stablecoins, despite relaxing crypto partnership rules for banks.
Long explained that while the Fed recently rescinded four prior crypto guidelines, a Jan. 27, 2023, statement was left intact in coordination with the Biden administration.
The guidance, according to Long, blocks banks from engaging directly with crypto assets and prohibits them from issuing stablecoins on permissionless blockchains.
However, Long noted that once a federal stablecoin bill becomes law, it could override the Fed’s stance. “Congress should hurry up,” she urged.
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