fmcpay coinbases subpoena of sec chair gensler faces judicial criticism
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Coinbase’s subpoena of SEC Chair Gensler faces judicial criticism

Posted on by Audrey

Judge Katherine Polk Failla recently condemned Coinbase’s attempts to subpoena Securities and Exchange Commission (SEC) Chairman Gary Gensler. She indicated that their attempts were unexpected and misplaced.

Prior to Gensler’s sentence, the court stated that the materials were irrelevant. She also recommended that Coinbase alter or withdraw their proposal.

Coinbase to create its first NYC office

Judge Failla’s skepticism: A blow to Coinbase’s subpoena efforts

Judge Failla, who presided over the District Court for the Southern District of New York, questioned Coinbase’s reasoning for the demand.

“Let me note that counsel on both sides is very smart, very clever, they’re all very clever people…but I was kind of surprised and not in a good way. I found the arguments at least as articulated in the July 3 response to border on the fatuous,” she remarked.

Coinbase first sought papers from the SEC in April. Later, the business broadened its request to include Gensler’s personal correspondence throughout his stint as SEC Chair and the previous four years.

The SEC immediately protested this request, calling it a “improper intrusion” into Gensler’s personal life. They suggested that any relevant papers should be obtained from the agency itself rather than from individual workers.

Jorge Tenreiro, a senior trial attorney with the SEC, said that Gensler’s conversations before to his nomination as Chair were irrelevant to the case. He emphasized that the SEC Chair is neither a factual nor an expert witness in this case. Tenreiro also cautioned that issuing such a subpoena may establish a bad precedent for future instances.

“Given also the utter lack of relevance of the requested documents, and the potential chilling effect on public service, the Court should quash the Subpoena and issue a protective order,” SEC lawyers contended in their filing.

Coinbase’s counsel, Kevin Schwartz, contended that Gensler’s interactions were relevant, particularly those prior to his chairmanship. He noted that Gensler’s status as a renowned pundit on digital assets, as well as his public utterances, were frequently interpreted as his personal opinions. Thus, these interactions were important for comprehending the regulatory background.

“What Mr. Gensler was saying in his private communications about the regulatory status of digital assets, and what market participants were saying to him about these matters, is probative of the objective understanding of the public and market participants regarding what conduct the securities laws prohibit,” Schwartz explained.

Judge Failla was particularly disappointed with Coinbase’s explanation. She questioned the importance of Gensler’s pre-chair pronouncements, characterizing them as speculative and unconvincing.

Despite this, she admitted that the SEC had blocked Coinbase and urged the parties collaborate on a briefing timetable. Furthermore, she encouraged Coinbase to file a move to compel rather than sticking with the present subpoena strategy.

Coinbase’s legal battle with the SEC began in June 2023. The SEC sued Coinbase, saying that company functioned as an unlicensed exchange, broker, and clearing agency. Furthermore, it argues that Coinbase has provided unregistered securities through its staking services.

The SEC has also targeted many tokens featured on Coinbase’s platform, including as Solana (SOL), Cardano (ADA), and Polygon (MATIC), claiming they are unregistered securities. However, Coinbase has refuted the claims. The cryptocurrency exchange stated that none of the assets on its platform qualify as securities.

Germany’s BTC selling nears an end with only 4,925 Bitcoin left to transfer

German authorities sold 10,567 BTC worth $600 million today, adding significantly to Bitcoin’s 18% reduction in price over the last month, along with sell-offs from Mt. Gox and Genesis Trading.

Germany Shakes Up Crypto Market With Fresh 1,500 Bitcoin Move

As of 1:00 p.m. EST on Thursday, July 11, wallets linked to German authorities held the remaining 4,925 BTC, which is presently worth $285 million. This is a greater than 90% decline in BTC owned, down from 50,000 BTC valued at over $3 billion when they began selling the assets three weeks earlier. BTC has fallen around 18% since Germany initiated its Bitcoin liquidation.

According to blockchain data from Arkham Intelligence, German authorities’ Bitcoin accounts moved 10,567 BTC worth more than $600 million today to exchanges like Bitstamp, Coinbase, and Kraken, as well as other service providers.

Earlier in June, crypto.news revealed that the German Federal Criminal Police Office (BKA) had confiscated around 50,000 BTC from the proprietors of the popular pirate movie website Movie2k.to in 2013. The BKA got the Bitcoin in mid-January following a “voluntary transfer” from the suspects.

Justin Sun, the founder of Tron, has recommended buying the country’s Bitcoin to mitigate market harm.

Sell-off fears

Even if Germany looks to be reaching the conclusion of its sell-off, other entities still need to sell their BTC.

Mt. Gox, which was one of the largest Bitcoin exchanges until it collapsed in 2014, has begun repaying its creditors following a decade-long process. This settlement includes more than 140,000 BTC, 143,000 Bitcoin Cash, and 69 billion Japanese yen, for a total of about $9 billion.

Many experts were afraid that the unexpected surge in BTC supply in the market would cause considerable downward pressure on prices. They were concerned that many creditors would sell up their interests to lock in gains.

Adding to the pressure, Genesis Trading has been actively selling BTC over the last month. Genesis has been liquidating assets, which has contributed to heightened selling pressure in the market.

These joint operations by Mt. Gox and Genesis Trading, along with German selling, have worsened Bitcoin’s current price slide, which has already dropped 18% in the last month.

Ripple CEO spots prespect of CF Benchmarks XRP Index product

CF Benchmarks has developed a new reference rate for XRP and Internet Computer (ICP), winning praise from Ripple CEO Brad Garlinghouse.

Ripple Labs Inc., a blockchain payments company, has acknowledged the potential of the CF Benchmarks XRP Index product.

CME, CF Benchmarks to launch two crypto reference rates for XRP, Internet Computer (CME) | Seeking Alpha

CME Group introduces XRP reference rates

On Wednesday, the Chicago Mercantile Exchange (CME) announced the availability of new reference rates and real-time indexes for Ripple’s XRP and Internet Computer (ICP).

According to its design, the new benchmarks would give clear price data, allowing market players to appropriately assess their portfolios. The official debut of the new reference rates and indexes is set for July 29. The announcement spurred discussion about a possible XRP ETF launch.

CME Group’s Global Head of Cryptocurrency Products, Giovanni Vicioso, remarked, “With 24 cryptocurrencies in our suite of CME CF References Rates and Real-Time Indices, we will provide pricing data across more than 93% of the investible cryptocurrency market capitalization.”

In reaction to the announcement of reference rates and real-time indices, Ripple CEO Brad Garlinghouse stated that this is the first step toward institutional crypto products.

As a result, he complimented both CME Group and CF Benchmarks’ efforts to introduce the XRP Index, saying that “the market has spoken.”

XRP ETF potentially increase

Meanwhile, the new benchmarks for XRP and ICP will be based on price data from top crypto exchanges including Bitstamp, Coinbase, and Kraken.

This ensures that market players always have access to precise and trustworthy data. Notably, the daily reference rates will be based on the US dollar price of each asset, which is announced at 4 p.m. London time. However, the real-time indexes will be updated every second.

CF benchmarks played an important part in the asset class’s growth. Sui Chung, CEO of CF Benchmarks, expressed delight for the move, noting increased customer participation in a wide spectrum of cryptos.

The discussion and speculation around a prospective XRP ETF is still underway. Previously, senior Bloomberg ETF analyst James Seyffart stated that the viability of an ETF for Ripple’s native cryptocurrency is heavily reliant on its participation on a major derivatives exchange such as CME. This makes the new development significant for XRP in terms of a potential ETF.

Even Ripple President Monica Long has expressed her strong support for an XRP ETF.

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