Headlines
▌ FTX creditors will receive 142%-118% compensation
Cryptocurrency exchange FTX has amassed billions of dollars in funds beyond what it needs to pay customers it lost in its November 2022 collapse, enabling them to be fully compensated after the company goes bankrupt. The extra cash will be used to pay interest to the company’s more than 2 million customers, a rare outcome as creditors typically receive very little money in U.S. bankruptcies. The company will have as much as $16.3 billion in cash to distribute once it completes the sale of all its assets, according to a company statement. It owes about $11 billion to customers and other non-government creditors.
While all debts will be repaid in full plus interest, shareholders will be left with nothing, according to court documents filed late Tuesday in the federal court in Wilmington, Delaware, which is handling the FTX case.
Depending on the type of claim in the case, some creditors could receive up to 142% of what they are owed. However, the vast majority of customers will likely receive 118% of what they were paid on the FTX platform on the date of the company’s Chapter 11 bankruptcy.
The company, which is now being run by restructuring advisers, has also proposed setting up a fund to pay some creditors, including those who loaned FTX cryptocurrencies, money that would otherwise go to government regulators.
As FTX moves into the final stages of its bankruptcy case, payments may still take several months.
▌ Vitalik Buterin proposes an alternative to EIP-3074
Wallet Connect developer Pedro Gomes posted on the X platform that Vitalik Buterin proposed an alternative to EIP-3074, moving from opcodes to transaction type methods, a new approach that benefits from using 4337 infra PLUS to reduce the risk of core developers. Wallet Connect also includes 7377 txn types to more smoothly migrate EOAs to smart accounts.
As previously reported, Ethereum developers plan to improve the usability of crypto wallets through EIP-3074.
Quotes
As of press time, according to Coingecko data:
The latest transaction price of BTC is $62,362.69, with a daily change of -1.3 % ;
ETH's latest transaction price is $3011.74, with a daily change of -1.7 % ;
BNB's latest transaction price is $577.42, with a daily change of -1.8 % ;
SOL's latest trading price is $148.11, with a daily change of -3.1 % ;
DOGE's latest trading price is $0.1501, with a daily change of -4.1 % ;
XPR recently traded at $0.5245, with a daily change of -2.9 % .
policy
▌US SEC Chairman: Crypto investors are not getting the proper disclosure they deserve
Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), discussed topics such as cryptocurrency in an interview with CNBC on Tuesday. Gensler said that we regulate $110 trillion in capital markets. About half of that is the stock market. Half is the bond market and other markets, and cryptocurrency is only a small part of our entire market. But it is a huge part of the scams, frauds and problems in our market because most of this area does not meet the protection of our securities laws.
Gensler also stressed that cryptocurrency investors are not getting the proper disclosure they deserve, and that our compensation is also based on performance neutrality. As long as investors get full, fair, complete and truthful information, they can make a decision. They don't get that in cryptocurrencies. Gensler reiterated that if they are a crypto security, then it is required.
SEC refutes Terraform's claim that fraud occurred outside the U.S.
Lawyers for the U.S. Securities and Exchange Commission have responded to a memo from Terraform Labs that proposes remedies following a civil case verdict. In a May 6 filing with the U.S. District Court for the Southern District of New York, the SEC rejected Terraform’s argument to reduce disgorgement in a civil case verdict for which a jury found the company liable. According to SEC lawyers, Terraform and co-founder Do Kwon never made the argument in court that the commission was enforcing the extraterritorial application of federal law to the issuance and sale of tokens outside the United States. The SEC filing says the defendants’ arguments lack merit because they rely on a misapplication of the law and misrepresentations of relevant facts.
As previously reported, Terraform Labs said the SEC's demand for a $5.3 billion fraud fine was unreasonable, and Terraform said most of the stablecoins were sold outside the United States.
▌U.S . Congressman: New regulations will be introduced to combat currency mixers as a money laundering tool
U.S. Representative Sean Casten said that new legislation is coming soon that will crack down on mixers as a money laundering tool. Casten also emphasized that USDT is the favorite token of illegal finance.
▌US SEC cryptocurrency regulation sparks partisan divide, with DEBT Box case and mixer regulation becoming focus
U.S. Democrats and Republicans diverged over the Securities and Exchange Commission's (SEC) stance on cryptocurrency regulation at a congressional hearing on Tuesday. Democratic Representative Maxine Waters said the party will always pursue compliance, investor protection and market integrity, while SEC Chairman Gary Gensler insisted that most cryptocurrencies should be considered securities. In addition, the SEC was questioned over its handling of the case involving cryptocurrency startup DEBT Box, with a federal judge criticizing the SEC's actions as malicious and two lawyers from the agency resigning over improper handling of the case. On the other hand, Republican lawmakers plan to repeal an accounting guideline from the SEC, sparking another round of controversy. The hearing also involved regulation of mixers, with one Democratic congressman proposing a bill to crack down on cryptocurrency mixing services suspected of money laundering. These disputes highlight the complexity of cryptocurrency regulation and the divisions that exist between government, industry and regulators.
Coinbase Legal Chief Questions SEC Chairman's Statement That Most Cryptocurrencies Are Securities
Coinbase Chief Legal Officer Paul Grewal called on U.S. SEC Chairman Gary Gensler to stop misleading the market on the legal status of cryptocurrencies in a social media post on May 7. Grewal made the above statement in response to Gensler's recent interview claiming that many digital assets fall into the category of securities under current laws. However, Grewal countered that SEC Chairman Gensler's statement was wrong because the regulator's lawyers had previously acknowledged that cryptocurrencies do not fall within the definition of securities.
Blockchain Applications
▌German Reconstruction Bank to issue digital bonds based on blockchain
KfW is preparing to issue the first blockchain-based digital bond in the form of crypto-securities under the German Electronic Securities Act (eWpG). The blockchain-based transaction will be conducted by a consortium of bookrunners consisting of DZ Bank, Deutsche Bank, LBBW and Bankhaus Metzler, with Union Investments listed as the lead investor. Other investors will join in the coming weeks, with the transaction scheduled to be completed in summer 2024. KfW has already issued its first digital bond in the form of centrally registered securities.
▌ Silent Protocol introduces “Ghost Layer” solution for Ethereum using ZK and 0VM
Silent Protocol has launched the "Ghost Layer," described as "the world's first Layer 1.5 on Ethereum," according to an official blog post. Founder Novachrono wrote in the post that it implements a "modular secure value transfer layer, creating the first fully compliant, composable, and privacy-preserving ecosystem." The team said: "Using ZK-based systems and 0VM technology, private asset storage and cross-chain value flow are achieved. Silent Protocol also launched EZEE in 2023, solving the challenge of state denial. Ghost Layer marks Silent Protocol's commitment to building an Ethereum-compatible and composable framework that enables developers to create privacy-preserving applications."
▌ NFT Market Etherity Plans to Transform to Ethereum L2
The Ethernity team said it is leveraging Optimism to transform from an Ethereum-based NFT market to an Ethereum Layer 2 solution designed specifically for entertainment brands. Etherity's enhanced platform integrates an AI-driven DRM protocol to ensure strong IP protection, thereby improving security and scalability. This strategic upgrade aims to redefine blockchain entertainment, aiming to attract major franchises of global entertainment brands and establish new industry standards.
Cryptocurrency
▌ Former CEO of Digitex Futures Exchange admits to violating bank secrecy laws
Adam Todd, founder and former CEO of Digitex futures exchange, pleaded guilty in federal court for failing to establish an anti-money laundering program at the company. In a statement on May 7, the U.S. Attorney's Office for the Southern District of Florida said Todd admitted to "intentionally causing" Digitex to violate the Bank Secrecy Act. Authorities indicted the former CEO in February. According to the indictment, Todd operated an unregistered futures platform for U.S. customers between 2018 and 2022 and failed to implement and maintain AML and Know Your Customer (KYC) programs.
Grayscale withdraws 19b-4 application for Ethereum futures ETF
Grayscale has taken the surprising step of withdrawing its 19b-4 application for an Ethereum (ETH) futures exchange-traded fund (ETF), just three weeks after the securities regulator was forced to make a decision. The cryptocurrency asset manager filed a notice to withdraw its Grayscale Ethereum futures ETF with the U.S. Securities and Exchange Commission on May 7.
▌Pro -cryptocurrency US presidential candidate Kennedy will attend the 2024 Consensus Conference
Independent U.S. presidential candidate Robert F. Kennedy Jr., who touted a pro-cryptocurrency stance during his campaign, is set to speak at the Consensus 2024 cryptocurrency conference in Austin, Texas, later this month.
▌BlackRock , Ondo, and Superstate became the companies with the greatest impact in the RWA field in the first quarter
BlackRock, Ondo, and Superstate became the companies with the greatest impact in the RWA field in the first quarter. The RWA market achieved rapid growth in the first quarter. Driven by the huge interest of institutions and the launch of innovative products, tokenized treasury bonds including BlackRock's US Dollar Institutional Digital Liquidity Fund, Superstate's Short-Term U.S. Government Securities Fund and Ondo's USDY increased by 41% to nearly US$1.3 billion.
▌Bloomberg ETF analyst: Grayscale spot Bitcoin ETF's capital inflow may be the result of short-term trading
Bloomberg ETF analysts have a few theories about the two-day inflow into Grayscale's spot Bitcoin exchange-traded fund. Grayscale's spot Bitcoin ETF ended 78 days of outflows after recording net inflows for two consecutive days. Bloomberg ETF analyst James Seyffart said he is not entirely sure what may have caused the volatility, but there may be several different explanations. "It could be a short-term tactical trade or some kind of hedging trade, and fees are far less important in shorter time frames," he said.
▌ Robinhood's first quarter revenue is expected to hit a three-year high
Trading app Robinhood is expected to record its highest quarterly revenue in nearly three years, thanks to a steady rebound in stock and cryptocurrency trading. Expectations of global interest rate cuts pushed U.S. stocks and Bitcoin to record highs earlier this year, attracting traders back to the market and helping the retail-oriented brokerage company to earn more trading revenue. Robinhood was at the forefront of the "monster stock" frenzy in 2021 and is now recovering from a downturn after the trading boom caused by the epidemic. JPMorgan analysts said that trading volumes in stocks, options and cryptocurrencies in Robinhood's core business rebounded sharply in the first quarter, with total trading volume increasing by nearly 20% year-on-year. Driven by strong retail trading activity, Robinhood's stock price soared 58% in the first three months of this year, the largest single-quarter increase since its listing.
Important economic developments
▌The probability of the Federal Reserve keeping interest rates unchanged in June is 91.2%
According to CME's "Fed Watch", the probability of the Fed keeping interest rates unchanged in June is 91.2%, and the probability of a 25 basis point rate cut is 8.8%. The probability of the Fed keeping interest rates unchanged by August is 69.5%, the probability of a cumulative 25 basis point rate cut is 28.4%, and the probability of a cumulative 50 basis point rate cut is 2.1%.
Morgan Stanley pushes back its forecast for the first Fed rate cut to September
Citing a "lack of progress" in inflation, Morgan Stanley economists pushed back their expectations for the first Fed rate cut to September from July. They still expect three 25 basis point rate cuts this year. The lack of progress since the beginning of the year means it will take longer for Fed policymakers to be confident that inflation is falling back toward their 2% target in a sustained manner, economists including Ellen Zentner, Sam Coffin and Diego Anzoategui said in the report. They expect the three-month and six-month core PCE to be "close to or below" 2% by the end of the year, in which case waiting until after September to cut rates "will be too late."
Golden Encyclopedia
▌What is liquidity staking?
Liquid staking allows stakers to maintain liquidity of staked tokens by using alternative tokens, which they can use to earn additional yield through DeFi protocols. Liquid staking enables cryptocurrency holders to participate in staking without giving up control of their holdings. This changes the way users do staking. Projects such as Lido have introduced liquid staking to provide tokenization of staked assets in the form of tokens and derivatives.
Disclaimer: As a blockchain information platform, Jinse Finance publishes articles for information reference only and is not intended as actual investment advice. Please establish a correct investment philosophy and be sure to raise your risk awareness.
