Hodder Law Weekly Newsletter - March 8, 2023
Hello everyone,
I hope you are all having a great week! The price of Bitcoin as of Wednesday, March 8 at 2:50 p.m. EST is $22,029.
Headlines.
Bitcoin of America's CEO and Lawyer were arrested, and 52 BTMs were seized. The investigation was conducted by the United States Secret Service, in combination with 28 other government agencies. It appears the Company did not have proper AML controls in place to prevent the kiosks from being used to scam the citizens of Ohio. The charges include money laundering, unlicensed money transmission, tampering with records, receiving stolen property, and engaging in a pattern of corrupt activity. The indictment lists the CEO's bank accounts that have been frozen and details of his cars and houses that have been seized.
SEC is trying to block Binance.US's Voyager bid citing concerns that Binance.US is operating an unregistered securities exchange. At the Voyager bankruptcy hearing, SEC senior trial attorney objected to the restructuring plan and stated that “the offering and sale of VGX tokens have the attributes of a securities transaction.”
Xapo Bank becomes the first bank to offer Bitcoin lightning payments. With the Lightning Network capable of millions of transactions per second, the Gibraltar-licensed Xapo Bank will be the first of many financial institutions to get on board. Low transaction fees and not having to convert to USD make the lightning network an attractive choice and an integral part of the growing crypto infrastructure now being developed.
U.S. Treasury introduces CBDC working group, discusses potential routes for digital dollar. The working group will be looking to develop policy recommendations and objectives in the national interest. A CBDC could be developed with significant incentives for private companies to help get it off the ground. Thankfully, Tom Emmer is attempting to pass a bill preventing the Feds from launching a CBDC.
Inside Bitcoin's $7 Billion Sunken Treasure. The world’s largest Bitcoin fund, Grayscale Bitcoin Trust trades at a huge discount to its underlying net asset value. With approximately $15 billion in Bitcoin, Grayscale wants to convert GBTC into an ETF in order to close the gap and unlock $7 billion for shareholders. The SEC won’t allow it to be converted to an ETF, so Grayscale is now threatening to sue the SEC.
FTX debtors sue Grayscale Investments and its Executives. John J. Ray III, who’s taken over as CEO at FTX has directed Alameda Research to seek an injunctive relief to unlock billions in unrealized value for Grayscale shareholders. The FTX debtors believe their shares in Grayscale would be worth about 90% more (about $550 million) if Grayscale had not extracted more than $1.3 billion in exorbitant management fees.
The Rise and Fall of Silvergate’s Crypto Business. With several large crypto exchanges pulling away from Silvergate they’ve had their deposits fall from $12 billion to under $4 billion. The Federal Reserve doesn’t want institutions they oversee to be entirely focused on crypto, so it might be a while before we see another bank like Silvergate.
South Dakota proposes a bill to change the definition of money to exclude Bitcoin. Many took to Twitter to point out the dangerous wording of this legislation, accusing it of paving the road for a CBDC. Actually, the amendment is meant to promote stability and predictability with commercial transactions.
The number of Bitcoin wallets with at least 1 BTC could soon hit a million! When Bitcoin was at an all-time high in November 2021, there were just over 800,000 wallets with at least one bitcoin. Since the drop in Bitcoin’s price, that number is now nearing a million wallets as investors take advantage of the buying opportunity.
HODLCast.
Watch the latest HodlCast on my YouTube channel. This week I discuss the following: BlockFi - The 55 million Robinhood shares SBF pledged to Zac Prince are being called into bankruptcy, and the BlockFi lawyers are suggesting this is a bad-faith move to make the situation more complex. It's been estimated that BlockFi owes up to $10 billion to more than 100,000 customers, and the top three creditors are owed $1.3 billion alone. Celsius - The UCC in Celsius is trying to enforce clawbacks from retail users who withdrew funds within 90 days before the bankruptcy. Anti-CBDC Act - Crypto-friendly congressman Tom Emmer introduced a new Bill that will block the Federal Reserve from issuing a CBDC in the US, working on a CBDC in private, or using a CBDC to control the economy. Operation Choke Point - a description of all the pressure on the crypto industry from banks in the past few months. Read more about this on the Hodder Law blog.
Hodder Law Firm Blogs.
Bankruptcy Clawbacks, CBDCs, and Operation Choke Point. We dive into the BlockFi Bankruptcy case, Celcius Clawbacks, the Anti CBDC Bill, and the government's renewed Operation Choke Point. Read all about it on the Hodder Law blog. EU Regulations on Markets in Crypto Assets. Cryptocurrencies have become an increasingly popular way for individuals to invest and store their assets. However, the relatively unregulated nature of the crypto market in the European Union has led to concerns about its stability and security. In response to these concerns, the EU has recently finalized a regulatory plan. Read more on the Hodder Law blog.
An investment in knowledge pays the best interest. - Benjamin Franklin
Make it a great week! Sincerely, Sasha Hodder Hodder Law sasha@hodder.law www.hodder.law
