The cryptocurrency business is thriving, but many things are happening, including, the Fed, SEC investigating Goldman Sachs, the Indonesian government unveiling list of 501 tradable cryptocurrencies, the US court approving the SEC-Binance.US agreement, and much more!
In this issue:
- Fed, SEC investigate Goldman Sachs over Silicon Valley Bank’s securities portfolio.
- Indonesian government unveils list of 501 tradable cryptocurrencies.
- Ethereum explores NFT inscriptions With Ethscriptions.
- US court approves SEC-Binance.US agreement.
- Ripple collaborates with Colombia’s Central Bank to explore blockchain use cases and XRP ledger-powered CBDCs.
- Brazil appoints Central Bank & Securities Commission as crypto market regulators.
- Blockchain developer platform Alchemy releases AI-Powered tools for Web3 builders.
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Fed, SEC investigate Goldman Sachs over Silicon Valley Bank’s securities portfolio.
Goldman Sachs is currently facing scrutiny from the Federal Reserve and Securities and Exchange Commission (SEC) regarding its involvement in the purchase of Silicon Valley Bank’s securities portfolio before the bank’s collapse, The Wall Street Journal has reported, citing sources familiar with the matter.
According to the report, both agencies are investigating Goldman Sachs’ actions during its failed capital raise before the collapse of SVB. The Justice Department has also reportedly issued a subpoena to Goldman Sachs as part of its investigation into SVB.
Insiders have also allegedly reported that the Federal Reserve and SEC are particularly interested in obtaining documents relating to Goldman Sachs’ dual role as buyer of SVB’s securities portfolio and the adviser for the bank’s capital raise. The agencies are reportedly investigating whether there were any improper communications between Goldman’s investment banking division and its trading division regarding the sale of the portfolio.
In response, Goldman has shared that it is “cooperating with and providing information to various governmental bodies in connection with their investigations and inquiries into SVB, including the firm’s business with SVB in or around March 2023.”
In the final days leading to the collapse of SVB, Goldman Sachs was reportedly hired to assist the bank in raising capital. At the same time, its trading division purchased “SVB’s $21 billion portfolio of available-for-sale debt securities at a discount.” As WSJ reported, bankers and financial lawyers consider it uncommon for banks to simultaneously act as both an adviser and a buyer of a company’s assets, except in times of financial distress.
Sources familiar with the matter have also reportedly disclosed that Goldman advised SVB executives to “sell part or all of its securities portfolio” before raising capital to demonstrate the need for funding. This advice was reiterated by Greg Becker, SVB’s former CEO, during his testimony before the Senate Banking Committee.
On March 10, California regulators took the unprecedented step of closing down Silicon Valley Bank, a prominent financial lender catering to venture capital firms and tech companies. Before its closure, SVB stood as the 16th largest bank in the United States, boasting assets of more than $212 billion.
Indonesian government unveils list of 501 tradable cryptocurrencies.
The Indonesian government has unveiled an extensive list of tradable cryptocurrencies, signaling its growing acceptance of digital assets. Specifically, in a recent official document, the government recognized over 500 tokens that can be traded in physical markets.
The list encompasses prominent cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Solana (SOL), Cardano (ADA), Ripple (XRP), Polkadot (DOT), Sandbox (SAND), Uniswap (UNI), and many others.
Prominent Chinese reporter Colin Wu brought the development to the crypto community’s attention, sparking discussions about Indonesia’s crypto-friendly stance and potential plans to allow cryptocurrencies as a legal means of payment.
It is worth mentioning that the listed tokens included those recognized as securities by the U.S. Securities and Exchange Commission (SEC).
Following the news, an Indonesian YouTuber expressed pride in his country’s crypto-friendly status, emphasizing that Indonesia currently views crypto as commodities. However, he acknowledged that cryptos are not yet permitted as a means of payment within the nation.
The YouTuber hinted at the possibility of Indonesia allowing cryptocurrencies for payments. He noted that while the country currently does not permit Bitcoin as a means of payment, efforts are underway to make it legally acceptable in that regard.
Notably, Indonesia has been a welcoming country for crypto adoption. In January this year, it launched a crypto exchange following a shift of the regulatory powers. Later in February, it proposed a National Digital Asset Exchange. The Indonesian government’s decision to expand the list of tradable tokens further reflects a progressive approach toward digital assets. As the country explores the regulatory landscape of crypto-related concerns, the future looks promising for Indonesia’s crypto enthusiasts.
Ethereum explores NFT inscriptions With Ethscriptions.
In a move that mirrors Bitcoin’s foray into NFT inscriptions, Ethereum is making significant strides by introducing a new feature called Ethscriptions. This Ethereum-based inscription system has generated a positive response from users, drawing parallels with Bitcoin’s inscriptions and their impact on the crypto industry.
Middlemarch, the co-founder of Capsule 21, announced Ethscriptions on June 17, unveiling a groundbreaking system that allows the creation and sharing of digital works through Ethereum transaction call data. In conjunction with this exciting development, Middlemarch also launched Ethereum Punks, a collection of non-contract punks similar to those found on Bitcoin.
Ethereum has emerged as a dominant force in the NFT landscape, thanks to its smart contract capabilities and widespread adoption. The platform hosts the first set of prestigious NFTs, commonly referred to as blue-chip NFTs. A closer look at the NFT rankings on DappRadar, based on volume, sales, and market capitalization, reveals that the top five NFTs are all on the Ethereum network.
However, with the rise of inscriptions, Ethereum may experience an increase in transaction fees. Just as Bitcoin inscriptions and Ordinals impacted fees on its network, Ethereum could encounter a similar spike due to the popularity of Ethscriptions. The higher volume of transactions on the network could lead to increased fees being generated.
Crypto Fees data indicates that on June 16, Ethereum recorded the highest fees among other platforms, with daily fees surpassing 4.6 million.
US court approves SEC-Binance.US agreement.
United States Judge Amy Berman Jackson approved on June 17 an agreement between Binance.US, Binance, and the Securities and Exchange Commission (SEC), dismissing a previous temporary restraining order (TRO) that would freeze all Binance.US assets. Judge Jackson said on June 14 she would prefer the parties reach an agreement on their own rather than have her rule. The sides reportedly reached an agreement on June 16.
“We are pleased to inform you that the Court did not grant the SEC’s request for a TRO and freeze of assets on our platform which was unjustified by both the facts and the law,” Binance.US said on Twitter.
As per the approved agreement, only Binance.US employees will have access to client funds until the litigation is resolved. U.S.-based customers will retain the ability to withdraw funds throughout this period.
The deal between the crypto exchange and the U.S. regulator also prevents any access by Binance global officials to private keys of wallets, hardware wallets, or root access to Binance.US’s Amazon Web Services tools.
In a Twitter comment on the case, former chief of the SEC’s Office of Internet Enforcement John Reed Stark noted that the agreement includes a “particularly interesting provision” about the repatriation of certain assets to the U.S.
“Defendants shall repatriate to the United States, transfer to BAM Trading, and confirm that BAM Trading maintains possession, custody, and control in the United States of all fiat currency and crypto assets that are deposited, held, traded, or accrued by customers […],” reads the agreement. Additionally, the deal asserts that Binance.US must take immediate action to ensure “a verified written accounting” of accounts related to BAM entities valued greater than $1,000.
The SEC filed an emergency motion for a temporary restraining order on Binance.US on June 6, after accusing Binance CEO Changpeng “CZ” Zhao of having access to Binance.US customer funds in a lawsuit. The regulator alleged Zhao moved $12 billion of Binance’s funds through an entity he controlled called Merit Peak. Ahead of the hearing on the restraining order, Binance.US and Zhao submitted a joint memorandum denying that funds were ever mishandled. According to them, the SEC has been unable to identify a single instance where Binance.US customer funds have been misused.
Ripple collaborates with Colombia’s Central Bank to explore blockchain use cases and XRP ledger-powered CBDCs.
Ripple Collaborates with Colombia’s Central Bank to Pilot Ripple CBDC Platform for Enhanced High-Value Payment System
Ripple, a leading payments firm, has formed a strategic partnership with Colombia’s central bank to embark on an innovative initiative aimed at testing the capabilities of the company’s cutting-edge platform for central bank digital currencies (CBDCs) and stablecoins.
The collaboration involves Banco de la República and Colombia’s Ministry of Information and Communications Technologies (MinTIC), who will join forces to conduct a pilot program focused on exploring the various use cases of the Ripple CBDC Platform. The ultimate goal is to enhance the country’s high-value payment system and facilitate seamless financial transactions.
The Ripple CBDC Platform is an advanced solution, exclusively powered by the decentralized public blockchain known as XRP Ledger. This pioneering platform empowers central banks, governments, and financial institutions to create and manage their digital assets efficiently and securely.
According to a recent statement by Ripple, the pilot program is part of the third phase of a comprehensive blockchain experiment. This phase will involve testing the CBDC platform in a controlled environment to ensure the utmost security and prevent any potential risks to public resources.
“The third phase of MinTIC’s blockchain experimentation aims to educate national and territorial public entities through interactive and collaborative real-world application experiments. These experiments will highlight the extraordinary speed, scalability, and transparency offered by blockchain technology, which can revolutionize payment systems and redefine data management,” stated Ripple.
This groundbreaking collaboration between Ripple and Colombia’s central bank comes at a time when the South American nation is actively considering the implementation of a CBDC. By adopting a CBDC, Colombia aims to streamline financial transactions and combat the persistent issue of tax evasion. The partnership signifies a significant milestone for Ripple, further solidifying its position as a global leader in blockchain-based solutions for the financial industry. Moreover, it showcases Colombia’s commitment to harnessing innovative technologies to drive economic growth and financial inclusion.
Brazil appoints Central Bank & Securities Commission as crypto market regulators.
Brazil’s executive branch has designated the country’s Central Bank and its Securities Commission as responsible for overseeing the crypto market, according to a decree published on Wednesday.
The Securities Commission will exercise control over assets considered securities, while the Central Bank will determine the rules that exchanges must follow, including licensing requirements to operate, the decree detailed, finance news outlet InfoMoney reported.
In December 2022, former Brazilian President Jair Bolsonaro approved a crypto regulation bill that was passed by Brazil’s Chamber of Deputies and the Senate. The law created a “virtual service provider” license and established a crime of fraud involving virtual assets, with a penalty of between four and six years in jail plus a fine.
Brazil has become a regional crypto hub, with a high adoption rate of stablecoins and a market in which major crypto companies and protocols such as Coinbase, Bitget, and Metamask have opened operations.
Blockchain developer platform Alchemy releases AI-Powered tools for Web3 builders.
Alchemy, a blockchain developer platform, introduced AlchemyAI today – a suite of tools aimed at leveraging AI to help web3 developers speed up the development of their products and gain quicker access to on-chain data.
AlchemyAI will consist of two flagship products, ChatWeb3 and Alchemy ChatGPT Plugin, and will become available over the next few weeks.
With its new AI suite, Alchemy becomes the latest in a string of crypto companies that have recently announced plans to apply large language models (LLMs) like ChatGPT to blockchains.
“More non-technical people are going to be able to get into web3” as a result of AI, Alchemy product manager Arjun Patel told CoinDesk. “I think that’s the premise of where web3 is heading: how can we make it easier for people to get into the industry?”
ChatWeb3, which is still in its beta phase, is an AI chatbot powered by ChatGPT. According to Alchemy, the tool was trained on over 1000 Alchemy docs and other crypto resources to help Web3 developers build software more quickly, and with fewer headaches.
“With AI assistance, web3 developers can tap into a vast array of predefined code snippets, templates, and best practices, reducing the time spent on repetitive tasks,” Alchemy said in a blog post.
Elan Halpern, a product manager at Alchemy, told CoinDesk that developers will be able to treat ChatWeb3 like a pair programming partner, “and say, like, ‘Hey, I’m experiencing this weird error on the chain, can you help me debug it?’”
In addition to its in-app AI assistant, Alchemy built out a standalone plugin for ChatGPT that can be accessed today via OpenAI’s Plugin Marketplace. “Alchemy’s plugin allows developers and non-developers alike to get real-time blockchain information through natural language using Alchemy API endpoints,” Alchemy wrote in its blog post.
This plugin can currently pull information from several different blockchains, including Arbitrum, Ethereum, Polygon, and Optimism. According to Alchemy, the tool will eventually expand to all the chains that Alchemy supports.
Closing
That’s it for now! Thanks for reading today’s newsletter! Be sure to have a look at the Blog section to read our previous editions as well! Have a look at our Guides section if you’re interested in learning more about crypto! And finally, don’t forget to follow us on Twitter!
