2024-06-19 08:59

The U.S. regulator closed its investigation into "Ethereum 2.0," Consensys said. The SEC told Consensys' lawyers it wasn't recommending an enforcement action after ending an investigation into the company. The ether price rose after the news. The price of ether (ETH) rose after Consensys received letters from the U.S. Securities and Exchange Commission (SEC) saying the regulator had ended its investigation into the technology incubator company and was not going to recommend an enforcement action against it. The SEC told Consensys, whose products include the MetaMask wallet, it was not bringing any enforcement actions in a pair of letters sent to its law firms on Tuesday. In a blog post, Consensys said the SEC was "closing its investigation into Ethereum 2.0." The letters had the subject line "Re: In the Matter of Ethereum 2.0 (C-08950)," but did not otherwise explicitly mention the blockchain associated with the second-largest cryptocurrency by market capitalization. "We have concluded the investigation in the above-referenced matter," one letter said. "Based on the information we have as of this date, we do not intend to recommend an enforcement action by the Commission against your client, Consensys Software Inc." The letter said that while it's announcing the conclusion of an investigation, that should not be taken to mean there will never be an enforcement action. "The Commission is instructing its staff that in cases where such action appears appropriate, it may advise a person under inquiry that its formal investigation has been terminated. Such action on the part of the staff will be purely discretionary on its part for the reasons mentioned above. Even if such advice is given, however, it must in no way be construed as indicating that the party has been exonerated or that no action may ultimately result from the staff’s investigation of that particular matter," the letter said, citing a Wells Notice explainer on the SEC website. A second letter echoed the language about concluding an investigation, while also saying it did not agree with any factual statements or legal conclusions expressed by Consensys' own attorneys in a letter sent to the regulator asking about ETH's status as a security given the SEC's approval of certain spot ether exchange-traded fund application filings. Consensys sued the SEC in April, alleging that the regulator was investigating whether Ethereum, post-merge, might be a security. Ether rose as much as 2.6% after a Consensys post on X, data from TradingView show. It is up around 3% over the last 24 hours, according to data from CoinGecko. The CoinDesk 20 Index (CD20), a measure of the broader crypto market, has added 1.2%. CORRECTION (June 19, 09:27 UTC): Corrects spelling of Consensys in headline. https://www.coindesk.com/policy/2024/06/19/sec-ends-probe-into-consensus-wont-sue-over-ethereum/

2024-06-19 08:43

The percentage of credit card loans outstanding for over 90 days has increased to the highest since 2012, a signal that speculative activity may ease off. The percentage of credit card loans in serious delinquency has risen to the highest in over a decade. That may indicate a challenging period ahead for the U.S. economy and speculative activities. Top meme coins have dropped 20% in four weeks. The U.S. consumer is increasingly struggling to keep up with credit-card loan payments, painting a challenging picture for the economy and speculative activity in non-serious assets like meme coins. The percentage of credit card loans in serious delinquency, with balances outstanding for more than 90 days, increased to 10.69% in the first quarter, the highest since second-quarter 2012, data recently published by the New York Federal Reserve showed. While balances declined by $14 billion to $1.12 trillion during the first quarter, they're still 13.1% higher than the year before. Cracks in consumer finances are one of the most concerning economic data points, Austan Goolsbee, the president of the Chicago Federal Reserve Bank, said earlier this year, adding that it's often a leading indicator that "things are about to get worse." A mounting debt pile means less disposable income and weakened inclination to invest in risk assets such as meme coins. According to an article written by Luigi Guiso, Tullio Jappelli and Daniele Terlizzese in the American Economic Review, borrowing constraints can lead to individuals keeping a lower proportion of their wealth in illiquid and risky assets. Interestingly, meme coins, which are considered among the riskiest of digital assets, have been under pressure in the past four weeks, falling more than market leader bitcoin (BTC). Top meme coins by market value like DOGE, SHIB and WIF have dropped over 20% against bitcoin's 2.4%, Coingecko data shows. While consumer finances are weakening, it does not necessarily mean a complete collapse in meme coins, as "degens" might persist. Degens, or people engaging in high-risk speculative trading in the crypto market, are not fundamentally different from early internet adopters, AllianceDAO's Qiao Wang said in a blog post, characterizing them as: "Financial risk-takers who are brave enough to try unproven products." They do not pay attention to metrics, tokenomics, fundamental analysis or technical analysis, as noted by Ledger Academy and are "committed to the projects and communities they invest in." Kelly Greer, head of Americas sales at Galaxy, said degens are likely to stay active in the market despite mounting debt levels. "60% of Americans hold credit card debt and this continues to rise. By no coincidence, gambling and degeneracy also proliferate, @zerohedge may be right that the economy is cooked - but disagree on memes dying with it degens will gamble longer than the economy will stay solvent," Greer said on X. https://www.coindesk.com/markets/2024/06/19/meme-coins-and-macro-us-credit-card-holders-most-stressed-since-2012/

2024-06-19 08:00

The young token made waves in the crypto community over its supposed status as the “official” Trump token. Turns out one of X's biggest loudmouths was behind its issuance. Martin Shkreli, also known as "Pharma Bro," claims he and Barron Trump created the DJT token after initially denying involvement. This revelation followed a series of events, including Shkreli's $100 million bet with crypto trader GCR on the token's authenticity and blockchain sleuth ZachXBT's uncovering evidence linking Shkreli to the token. Despite the drama, the Trump campaign has not officially commented on the matter as of Wednesday. Martin “Pharma Bro” Shkreli said on Tuesday that he was behind the controversial DJT token in an X space tuned in by thousands of people, days after denying any involvement as influential accounts GiganticRebirth and ZachXBT joined in on the search for its creator. “I have 1000 pieces of evidence I created it with Barron,” Shkreli wrote to blockchain sleuth ZachXBT in a direct message posted by the latter. He confirmed the same in his X spaces podcast shortly after. The flavor-of-the-week token caused certain crypto enthusiasts to extensively wonder who was behind it after it went viral on Monday for its supposed links to Donald Trump and his son Barron. Blockchain sleuths found that DJT’s Telegram channel appeared to share the same admins as a token supported by Shkreli. Shkreli denied any involvement at the time, while DJT continued to rally. But things took a turn Tuesday night. Anonymous and influential crypto trader GiganticRebirth, popularly known as GCR, called out Trump’s supposed involvement in the token in his first X post reply since November 2022. He put up $100 million (not a typo) in a bet against Trump having to do anything with the project. That bet was originally floated by Alex Wice, another influential and popular crypto trader, at a value of $1 million. Shkreli appeared to provoke industry “whales,” a colloquial term for a person with significant token holdings, in a post citing Wice’s – which drew GCR, a known Trump backer, out of the woodworks. “The only way this is 'real,' is if Donald J Trump himself, says he launched a meme coin himself,” GCR posted. “I'm well aware there is a cabal strategy to bribe people in the Trump orbit to pretend they had something to do with this when in reality a cabal of crypto whales did a presale and allocation to KOLs.” In a separate post, GCR claimed to have been approached about being involved in the DJT project which he declined. Shkreli denied GCR was ever approached to be a part. Meanwhile, in the hours following GCR’s post, on-chain intelligence firm Arkham posted a $150,000 bounty that would pay out the amount to whoever unveiled the creator of the DJT token. This drew out ZachXBT, one of the most widely followed crypto sleuth on X, to submit his findings to Arkham. Shkreli’s messages to Zach and his X spaces came subsequently afterward. Shkreli’s now wants GCR to honor his side of the $100 million bet, having claimed that he co-created the token with Barron Trump’s supposed involvement. As such, the Trump campaign has not responded to CoinDesk’s request for comment on the topic since Monday, and as of Wednesday, Trump has posted nothing on his TruthSocial platform mentioning a token. Meanwhile, at least one large holder in both DJT and Shoggoth.ai, Shkreli’s other project, has been profiting amid the drama. Transactional data flagged by ZachXBT shows one large DJT holder sold nearly $830,000 worth of DJT late Tuesday. The wallet holds millions of dollars worth of SHOGGOTH tokens. DJT tokens have taken a bit amid the drama, however, as prices are down 58% in the past 24 hours, DEXTools data shows. https://www.coindesk.com/markets/2024/06/19/martin-shkreli-says-he-is-behind-trump-linked-djt-as-zachxbt-gcr-start-poking-around/

2024-06-18 15:50

Prospective providers of spot ether ETFs in the U.S. removed provision for staking from their applications to avoid potential regulatory roadblocks. Lack of staking is unlikely to concern institutional investors, though retail investors may be upset, Synder said. This difference in demand means there is a potential business case for providers to list separate, distinct products to satisfy both camps. Institutional investors are unlikely to be concerned that U.S. spot ether (ETH) exchange-traded funds (ETFs) won't be staking the underlying token to provide extra returns, according to Ophelia Snyder, a co-founder of digital asset manager 21Shares, even though retail investors would be keen to have that built-in. The discrepancy means there is a potential business case for providers to list separate, distinct products to satisfy both camps, Snyder told CoinDesk in an interview. Spot ether ETFs look set to list in the U.S. in the near future after the Securities and Exchange Commission (SEC) approved key regulatory filings from applicants last month. SEC Chair Gary Gensler told senators in a budget hearing last week that final approvals should be finished in coming months. Prospective providers have removed the provisions for staking from their applications to avoid potential regulatory roadblocks. "One of the things that people forget is that staked assets have an impact on liquidity," she said. "So, if ether's unstaking period balloons to 22 days, which does happen, how do you deal with that?" Institutional appetite There have been suggestions that the lack of staking may damp investor appetite for ether ETFs. JPMorgan said at the end of May that it expects $3 billion worth of inflows by the end of 2024. That figure could double if staking were permitted. Snyder, however, doesn't think the absence of staking is an issue for institutional investors. If it were, they'd want to see a track record of asset managers executing effectively against withdrawal delays because of the intrinsic risk management that it requires, she said. "For example, there could be months when the unstaking period is six or nine days, and that range can be so wide, it changes your liquidity requirements," Snyder said. "And it doesn't just jump from nine to 22 days. It actually slowly extends and if you monitor these things, there are data inputs that you can use to manage that portfolio such that you're doing the right things in terms of maximizing returns while minimizing the probability of a liquidity issue." 21Shares is likely to have a handle on the institutional market. Not only is it one of the existing providers of a spot bitcoin ETF in the U.S., it's one of the largest exchange-traded product (ETP) issuers in Europe. Its ether ETP, which includes staking, has assets under management of around $532 million. Its SOL equivalent has $821 million. The company is also applying for a U.S. spot ether ETF. That specifically excludes staking as a source of income. There's another issue to consider too: government coffers. It is unclear how staking rewards will be treated from a tax point of view in the U.S., she said. "If you want institutions to come and play, you need to start by making it easy," she said. Non-staked products would be "more digestible" to an institutional audience even if they're less popular with retail investors. Read More: London Stock Exchange Set to List Crypto ETPs for First Time https://www.coindesk.com/business/2024/06/18/ether-etfs-lack-of-staking-wont-dampen-strong-institutional-demand-21shares-ophelia-snyder-says/

2024-06-18 10:57

Spikes in crypto-related Google search queries have historically occurred at major market tops, validating legendary investor Warren Buffet's mantra of buying in doom and selling in boom. Top coins supposedly associated with artificial intelligence (AI) have dropped over 20% in seven days. Google Trends shows peak public interest in AI. Spikes in crypto-related Google search queries have historically occurred at major market tops, validating legendary investor Warren Buffet's mantra of buying in doom and selling in boom. A similar dynamic now seems to be playing out in the market for tokens supposedly related to artificial intelligence (AI). The so-called AI coins like FET, RNDR, TAO and GRT have seen their market value slide by as much as 30% in the past seven days, according to data source Coingecko, just as Google Trends indicates search interest in artificial intelligence may have peaked. FET is the fourth-worst performing of the top 100 cryptocurrencies of the past seven days. Market leader bitcoin (BTC) is down just 2.8% during the same period while the CoinDesk 20 Index (CD20), a measure of the broader crypto market, has lost 6%. Google Trends is widely used to gauge general or retail investor interest in trending topics. It shows the value for the search query "AI" over the past 12 months reached a peak of 100 last week. That's the same as the value of the past five years. A score of 100 represents peak popularity – the maximum number of searches observed for the query during a given time frame. In other words, the excitement about artificial intelligence has hit the main street, and an increasing number of existing and potential retail investors are looking for information about it and Nasdaq-listed chipmaker Nvidia (NVDA), a bellwether for all things AI. Though only indicative, the tool may be a good indicator to watch as the masses are often driven by emotions and frequently the last to enter a bull market and exit a bear market. For instance, spikes in searches for BTC and Solana's SOL occurred at the respective price tops in May 2021 and November 2021, respectively. It's crucial to note that bitcoin, known to have a strong positive correlation with NVDA, bottomed out with technology stocks in late 2022 after the debut of ChatGPT raised general awareness about artificial intelligence. According to GMO's Chief Investment Strategist Jeremy Grantham, the AI rally represents a potential bubble within a bubble that could soon deflate. That's an insight that might prompt caution in people considering investment decisions. https://www.coindesk.com/markets/2024/06/18/ai-related-coins-slide-as-google-search-shows-peak-retail-investor-interest/

2024-06-18 09:51

Over $400 million in crypto longs were liquidated in the past 24 hours as major tokens slid as much as 10%. Bullish bets on dogecoin (DOGE) futures saw $60 million in long trades liquidated, more than for bitcoin (BTC) futures. The liquidations occurred as DOGE prices dropped over 10%, reflecting broader market sell-offs and a bearish sentiment in the crypto market. Bullish bets on dogecoin (DOGE) futures fared worse than their bitcoin (BTC) counterparts on Monday, unusually, as a slide in the dog-themed meme token liquidated $60 million in long trades. The DOGE price slumped more than 10%, before briefly recovering amid a sell-off in major tokens and bitcoin in Asian trading hours. The CoinDesk 20 Index (CD20), a measure of the broader crypto market, has dropped 3.4% in the past 24 hours. BTC long bets lost $47 million in the same period. Ether (ETH) bullish bets lost the most, however, at $76 million. Overall, crypto longs lost over $440 million as profit-taking and dollar strength weighed on the market, traders said Tuesday. "The meme coin market has experienced a general pullback this month as bitcoin prices face pressure," said Lucy Hu, a senior analyst at Metalpha. "The expectation of one rate cut by the Fed has prompted investors to divert from risky assets to less risky ones, and DOGE may suffer as one of the largest meme coins on the market." Coinanlyze data shows that almost all the DOGE liquidation activity in the past 24 hours came from longs, or bets on higher prices. Only about $600,000 worth of shorts, or bets against the token, were liquidated. The figures are the highest for DOGE futures since May 2021, the data shows. Over $44 million of the liquidations occurred on Huobi, a crypto exchange popular with Asia-based traders. Open interest, or the number of unsettled futures bets, has dropped 16% to $600 million. Meanwhile, a long-short ratio tracking DOGE futures shows traders are positioning for further declines with the ratio at 0.94 – indicating a bearish bias. Liquidation refers to when an exchange forcefully closes a trader's leveraged position due to a partial or total loss of the trader's initial margin. It happens when a trader is unable to meet the margin requirements for a leveraged position, that is they don't have enough funds to keep the trade open. https://www.coindesk.com/markets/2024/06/18/dogecoin-bulls-see-60m-liquidations-in-biggest-hit-since-2021/