Hodder Law Newsletter - August 16, 2022
Updated: Sep 26, 2022
Hello everyone, I hope you are all having a great week! The price of Bitcoin as of Tuesday August 16 at 2:00 EST is $ $24,179.01. Bitcoin has been on an upward swing for the last few weeks and the price regained $25,000 briefly on Sunday. It hasn't hit this level since mid-June.
The recent jump in bitcoin can likely be attributed to the world’s largest investment management company BlackRock offering their clients access to bitcoin. BlackRock manages approximately $10 trillion dollars worth of assets, so anytime an organization of that size makes a move in the crypto space waves will be felt. News of the BlackRock private bitcoin trust for institutional investors came soon after their partnership announcement with Coinbase which saw a 16% jump in the share price of the crypto exchange earlier this month. Some speculators suggest this move by BlackRock lays out a path for bitcoin to reach up to $773,000 over the next five years. Check out this link for an analysis of what this prediction is based on.
BitcoinNews.com announced another win for bitcoin. The tourist town Santa Lucia in Honduras near the capital Tegucigalpa is launching a program that will allow the cryptocurrency to be accepted by 60 merchants. The bitcoin-friendly project is educating business owners to help them roll out the new payment option. Point of sales terminals will be distributed to all participating merchants, enabling them to sell their products in bitcoin. Widespread acceptance of bitcoin in Central America should see a boost in tourism numbers as happened recently in El Salvador. Here’s an article from Coin Telegraph discussing the advancement of bitcoin as an accepted currency in El Salvador. In other positive news for bitcoin in Latin America, the president of the Central Bank of Brazil, Roberto Campos Neto expressed his support for more moderate regulations to spur innovation in the crypto world. With more governments in the world recognizing the value of technological innovations in cryptocurrency Bitcoin can provide opportunities to the general population that the world’s current financial regime cannot deliver. This article from Bitcoin Magazine discusses how mass bitcoin adoption by developing nations can hugely benefit the average citizen. It focuses on Georgia, however the situation there is not unlike many other developing nations in the world.
With the Securities and Exchange Commission overseeing assets worth over $100 trillion dollars, it was only a matter of time before they increased scrutiny of the crypto space. Since establishing their digital assets enforcement program in 2017, there have been approximately 80 different crypto projects and companies they have targeted.
The Coin Bureau YouTube channel recently reported on nine different cryptocurrencies the SEC ruled to be securities. Here are the nine crypto projects recently labelled as securities by the SEC:
Flexa Network AMP token
RLYNetwork’s RLY token
DerivaDEX DDX token
XYO Network XYO token
Rari Capital RGT token
LCX token
Powerledger POWR token
DFX Finance DFX token
Kromatika Finance KROM token
With the SEC on the offensive against crypto, the best way forward is to assess which cryptocurrencies the SEC is likely to target, and which ones are safe. The SEC analysis may offer insight into what criteria they are looking for when targeting specific crypto projects.
Being based in the US puts a crypto project at arms reach of the regulator. Five of the nine projects the SEC identified as securities are based in the USA where fines are easier to administer.
Conducting an ICO where the founders or team retain a significant supply of the token.
An incomplete platform or protocol. The SEC doesn’t like projects raising money before everything has been built.
Any statements made by the company or team that could suggest the coin or token could increase in the future. Social media posts, blog posts and especially what is stated in the project’s white paper are all thoroughly scrutinized.
The involvement of a centralized organization in the project’s development or management.
On August 9, hackers nabbed close to $570,000 from Curve.Finance. Binance CEO Changpeng Zhao stated on Friday that Binance has frozen or recovered $450,000 earlier in the week stolen from DeFi protocol Curve.Finance. Fortunately, the planform’s developers stated they identified and fixed the source of the issue.
Turning a negative situation into a positive one is great news for the crypto space. It’s relieving for those in this community to have the reassurance that crypto exchanges like Binance are able to work with law enforcement to have funds returned to their users. This gives cryptocurrency added credibility knowing there is recourse against criminal operators in the crypto world.
The price of Ether has been surging in recent weeks in anticipation of the software upgrade of the Ethereum blockchain. This upgrade will move the blockchain to a less energy-intensive system and is expected to happen around September 15.
Using staked coins in a so-called proof of stake system will move Ethereum away from the current energy-intensive system of using miners.
This news has greatly contributed to Ethereum’s price increase which some traders and speculators think will continue until the upgrade next month.
That's all the crypto news from Hodder Law for the week of August 16. Look for next week's edition of the Hodder Law Firm crypto newsletter on Tuesday, August 23.
None of the information in this newsletter should be interpreted as investment advice.
Sincerely, Sasha Hodder Hodder Law sasha@hodder.law www.hodder.law
