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Hodder Law Weekly Crypto Newsletter - December 8, 2022



Hello everyone,

I hope you are all having a great week! The price of Bitcoin as of Thursday, December 8 at 9:39 a.m. EST is $16,831.


Headlines.


CFTC Commissioner wants two-tier rules for retail investors and millionaires. The proposed regime would implement more protections for the retail group. They will seek public input on the types of protections needed.




Genesis creditors owed $1.8B. Three groups of customers using Gemini’s Earn program have formed, with claims up to $.8B since withdrawals were halted on November 16. They are trying to avoid bankruptcy.


Celsius ordered to return depositors' funds.

Celsius argued that under the terms of use agreement that customers signed, the use of their crypto assets was handed over to Celsius, who wants to use funds from a stablecoin sale to fund their restructuring. The Judge said the depositors that were not in the Earn program can get their $50m back.


NYDFS proposes charging crypto businesses for supervision. In order to offset the cost of rising bureaucracy, New York’s Department of Financial Services (NYDFS) has proposed billing state-licensed crypto businesses, ensuring the agency can “continue adding top talent to its virtual currency regulatory team.” The NYDFS is looking to offset some of the costs related to supervision and exams, as they charge non-crypto financial institutions. The proposal is open for public comment.


US CFTC Commissioner Cites Latest Crypto Sanction in Call for New Rules.

CFTC Commissioner Kristin Johnson, wants the agency to use its powers to help keep customers’ assets safe. In a call to action against digital-assets fraud, Johnson said “bankruptcy filings reveal a grim portrait of some of the most egregious corporate governance and risk management failures in recent financial markets history.” However, CFTC enforcement extends only to CFTC-registered crypto firms.


Virtu Financial sues the SEC for Freedom of Information Act Request. Virtu Financial is a liquidity provider that offers high-frequency trading products and services. They’ve launched a lawsuit against the SEC to compel them to provide information about their rulemaking process. This case should shine some light on the Gensler-run administration.


Custodial vs. non-custodial crypto exchanges.

This is a great article to inform crypto users of the options and differences in the ways they can hold crypto. Custodial Exchanges have had a lot of bad press over the last couple of months. This is causing crypto users to flock towards self-custody solutions like non-custodial crypto exchanges. Centralized exchanges will need to move toward safety and transparency in order to meet customer demands and stay relevant.


Structural Adjustment: How The IMF And World Bank Repress Poor Countries And Funnel Their Resources To Rich Ones. This Bitcoin Magazine feature details the unconscionable practices that international organizations such as the World Bank and the International Monetary Fund impose on the developing world in order to extract wealth. The result is that small poor countries are so indebted they can’t possibly pay it off. The bailouts corrupt the incentives of the global financial system, whereas, in a truly free market world economy, creditor banks would face consequences of losing their money. With bitcoin as the world reserve currency, no one would make these high-risk billion-dollar loans in exchange for structural adjustments that destroy local economies.


Is SBF a 'pawn' and 'useful idiot' in a bigger plot to take down the crypto industry? This YouTube video from Kitco News features Mark Yusko, CEO, Founder, and Chief Investment Officer of Morgan Creek Capital Management. He raises some interesting questions about the FTX collapse. There’s speculation SBF was laundering money for U.S. politicians, and perhaps was being used to help take down the crypto industry.


HodlCast

SEC and FTX drive BlockFi into bankruptcy. BlockFi filed for Ch 11 Bankruptcy in NJ on Cyber Monday, after halting withdrawals on November 10. The SEC and various state regulators put a real damper on their business when it was sued for $100 million, and forced to shut down its interest accounts in the US. BlockFi nearly went bankrupt in July, and FTX swooped in and offered a $400 million line of credit, and an offer to buy the Company for up to $240m.



Make it a great week!

Sincerely, Sasha Hodder Hodder Law sasha@hodder.law www.hodder.law



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