In this issue
- Big waves at SEC: ‘Crypto Mom’ Hester Peirce speaks out, and more
- Elon Musk flirts with crypto Twitter
- Facebook’s WhatsApp users switch to Signal
- Bakkt looking to go public by buying shell company
- In China: DCEP e-RMB shows off new e-card features to serve its masses of rural poor
- Investment highlight: Singapore
From the Editor’s Desk
2021 kicked off with a bang. The week after reaching new highs, bitcoin prices headed north again, this time breaching the US$40,000 mark. But as we’ve seen of this market, it’s also a roller coaster as prices dipped once more on profit-taking. The question remains, just how sustainable is bitcoin’s overall trajectory upward? What we do know is that the trajectory of interest in this fairly new industry is of little doubt (we can even see it on Forkast.News and the spike we’re seeing in audience response).
What will be more impactful to the industry is what we’ll see from regulators. In my exclusive conversation with Securities and Exchange Commissioner Hester Peirce — her first media interview of the year and her first on-the-record remarks since the surprise enforcement move from the SEC against Ripple — we are seeing in real-time the disconnect sometimes across federal agencies, and within the SEC itself. What Peirce reinforced was the need for regulatory clarity, as a way to support innovation instead of stamping it out. The internal changes we’re seeing in the last days of the current administration at the SEC reflect how the regulatory mood and regard of the crypto industry might also change. The SEC’s lawsuit against Ripple as it moves forward won’t be led by the very person who helped instigate the action. This may yet leave room for a potential settlement — of which Ripple CEO Brad Garlinghouse already said the company had attempted to do and will continue to pursue with the new Biden administration.
The players are ever changing — and so, too might the rules.
Until the next time,
Founder and Editor-in-Chief
1. Sunlight and changes at SEC
By the numbers: U.S. Securities and Exchange Commission — over 5,000% increase in Google search volume.
Ripple fans can finally hear directly from the SEC as Commissioner Hester Peirce — also known as “Crypto Mom” — joined Forkast.News Editor-in-Chief Angie Lau in a special episode of Word on the Block. Although Peirce declined to comment on the SEC’s litigation against Ripple and XRP, she said that the agency enforcement is “never a good way to provide clarity.”
- Meanwhile, the SEC has announced that acting enforcement director Marc P. Berger is stepping down from his position. His tenure at the SEC culminated last month in the US$1.3 billion lawsuit against Ripple Labs and CEO Brad Garlinghouse and Executive Chairman Chris Larsen.
- Commissioner Peirce told Forkast.News that the direction of the SEC in 2021 will be shaped by the person that the incoming Biden administration appoints to be agency chair. Reuters, citing two unnamed sources, reported that Gary Gensler, a former chair of the Commodity Futures Trading Commission (CFTC), will be named the next SEC chairman.
Forkast.Insights | What does it mean?
For all the many criticisms of the Trump administration, the crypto industry might find it tough to do anything but sing praises for his crypto policy legacy. The Treasury’s Office of the Comptroller of Currency is run by a former Coinbase lawyer. The Commodity Futures Trading Commission intends to provide an omnibus regulatory framework by 2024 that would set up crypto to be fully regulated just like any other commodity. “21st century commodities” is how the CFTC puts it. As reported by Forkast.News, American regulators are warming to crypto and digital assets.
But with the new administration may come a different policy direction. The much decried STABLE Act, proposed in December by three house Democrats, is an example of how this could go. While on the one hand, some regulation of the US$25 billion stablecoin sector is needed, the long reach of the bill could, under one analysis, severely restrict the ability for users to run blockchain nodes that support stablecoins and put such activity in the exclusive hands of chartered banks. So much for encouraging innovation from the ground up.
It could be tempting to regulate these industries into compliance, but then they could just vanish to a more legally permissive jurisdiction offshore. Should the Biden administration not want this to happen, they would need to work with stakeholders and not against them. There are currently two bills snaking their way through the…