15 February

Financially speaking, sending someone 100 USDC is no different than sending them $100 via Venmo. In both cases, one user is handing over a claim against a balance sheet – Circle’s versus PayPal’s – to another. From the issuers point of view, each dollar held by its user is just a liability, to be matched against equivalent assets.

From the point of view of safety a properly designed stablecoin is more secure than anything that came before. That’s because half of the balance sheet of the issuer is recorded on-chain and can be verified in trustless fashion. For Venmo, this means parent company PayPal’s regulators need to constantly collect data on user balances (liabilities) and check they match reserves in liquid capital (assets). Awkwardly, the primary source of data for PayPal’s liability is PayPal itself. Stablecoin issuers are different because their liabilities – the tokens they issue – are visible on-chain. Even Tether, the much-maligned stablecoin issuer, can’t lie about token balances.

Dollar stablecoins can [also] be a powerful force for economic inclusion to a substantial portion of the global population – people living in countries with high inflation and low access to banking.

Dollar stablecoins aren’t just great for users, they are also great for the U.S. government because they increase demand for government debt at a time of high inflation and high deficits. Products like Tether’s USDT and Circle’s USDC have already created over $100 billion in new demand for U.S. Treasurys, demand that’s much needed given the risk of de-dollarization.

This makes a properly designed and regulated one the ultimate win-win. Great for the oppressed abroad and the U.S government at home. That’s the real reason congress is coming around.”

See Also: The greatest risk to the U.S. financial system is not allowing stablecoins; it is banning them
See Also: Binance CEO: crypto industry will probably move to non-dollar stablecoins
See Also: Stablecoin Issuer Paxos Burns $700M Binance USD in 27 Hours Amid Regulatory Pressure

Siemens (SIE), Germany’s third-largest publicly traded company by market cap, issued its first digital bond as it looks to reduce paperwork and reach out to potential purchasers directly. The 60 million euro ($64 million) bond, issued on the Polygon blockchain, has a maturity of one year.

A blockchain bond makes paper-based global certificates and central clearing unnecessary. What’s more, the bond can be sold directly to investors without needing a bank to function as an intermediary.

By moving away from paper and toward public blockchains for issuing securities, we can execute transactions significantly faster and more efficiently.

The Electronic Securities Act that allows the sale of blockchain-based debt to take place came into force in June 2021.”

See Also: Billionaire George Soros’ Fund Dives Deeper on Crypto Bets
See Also: Ken Griffin’s Citadel Securities Discloses 5.5% Stake in Crypto Bank Silvergate
See Also: Digital Asset Infrastructure Provider Taurus Raises $65M From Credit Suisse, Deutsche Bank
See Also: Institutional Crypto Trading Platform Elwood Technologies Expands Offerings

“Polygon, an Ethereum scaling project, picked March 27 as the date for its zero-knowledge Ethereum Virtual Machine (zkEVM) beta main network to go live.

Zero-knowledge (ZK) technology is seen by many as a major improvement for blockchains and cryptography, aimed at increasing the speed of transactions and reducing their cost. ZkEVMs are a type of zero-knowldege (ZK) rollup, a scaling solution that processes transactions faster on a layer 2, then sends the transaction data back to the mainnet blockchain – in this case Ethereum.

In October, Polygon went live with its zkEVM testnet, allowing Ethereum developers to move over their smart contracts from the main blockchain without having to reprogram them in a different language. Since the testnet went live, over 75,000 ZK proofs have been generated and 5,000 smart contracts have been deployed.

Polygon zkEVM Mainnet is set to be the first fully EVM equivalent ZK rollup to reach mainnet, this represents a huge step towards scaling Ethereum and bringing Web3 to the masses.”

The U.S. Securities and Exchange Commission (SEC) is falling short when it comes to addressing how it deals with the digital asset industry, said TuongVy Le, partner and head of regulatory and policy at investment firm Bain Capital. What the federal agency is doing is regulating “almost entirely through enforcement actions,” Le, a former chief counsel for the SEC’s Office of Legislative and Intergovernmental Affairs, said.

When the SEC tells us that something is not compliant, it’s not necessarily the same thing as telling us what they would consider compliant. Enforcement actions are very facts- and circumstances-specific, so it can be difficult to know how broadly to read any single action.

By blindly and mechanically applying the existing securities laws without considering the potential of digital assets and blockchain technology, the SEC could potentially just kill something like staking.

As for trying to comply with the SEC, it’s actually not as simple as going onto the SEC’s website and filling out a form. Applying the federal securities laws to something like staking services, where a provider takes your crypto and does things with it, that actually raises really novel and complex questions around custody.”

See Also: Lawmakers Continue to Quarrel Over ‘Crypto Nightmare’
See Also: SEC to Make It Harder for Hedge Funds to Work With Crypto Firms: Bloomberg
See Also: Stablecoins not the target in BUSD crackdown: Matrixport head of research

“Interactive Brokers, a global brokerage firm with headquarters in the United States, announced the launch of its crypto trading services for institutional clients in Hong Kong on Feb. 14.

The launch of crypto trading services occurs at a critical juncture in Hong Kong’s regulated digital asset market development. Paul Chan, the financial secretary for Hong Kong, stated in January that the Hong Kong government is open to working with cryptocurrency and fintech businesses in 2023.

In December 2022, lawmakers in Hong Kong approved legislation to create a licensing scheme for companies that offer services related to virtual assets. The new regulatory framework is intended to give cryptocurrency exchanges the same level of market acceptance as the one that is currently in place for traditional financial institutions.”

See Also: South Korea Issues Guidance / Clarity on Secuirty Tokens

“Crypto prices moved back and forth as inflation slowed at a lesser rate than expected. Bitcoin sank in the first hour following the U.S. Bureau of Labor Statistics’ release of the January consumer price ondex (CPI), which showed prices rising 6.4% versus projections for 6.2%. Then bitcoin returned above $22,000, the level it had lost five days ago.

Crypto markets’ resilience underscores a new, albeit faint, optimism about inflation and the economy. Despite the tepid decline, the CPI has now sunk seven consecutive months, implying the Federal Reserve’s efforts to stem inflation are yielding positive results. Things appear to be moving in the right direction. Inflation has fallen from 9.1% to 6.4% since June 2022.