20th April 2023 - Kraken.

tl;dr

Coinbase threatened to move out of the US, but Kraken might actually do it.

Market Snap

Market Wrap

Now below $29k it’s been a volatile couple of days for BTC.

It seems that an unusually large sell-order on Binance for close to half a billion dollars started the downslide, and was accompanied by the liquidation of leveraged longs.

Curious Cryptos’ Commentary – Gary Gensler

Gary Gensler, Chair of the SEC (Securities and Exchange Commission), was grilled by Congress two days ago. His performance is somewhat embarrassing for the man:

https://twitter.com/i/status/1648338351832064003

His reticence to state that ETH is a security perhaps bodes well for the highly anticipated outcome of the Ripple case.

Curious Cryptos’ Commentary – Kraken

Kraken, a centralised cryptocurrency exchange, has rarely, if ever, appeared in these missives of mine. That might be because I frequently find myself at odds with statements made by its Co-Founder and CEO, Jesse Powell, who seems to spend too much time moaning and complaining for my liking. But the latest news fits in so nicely with yesterday’s commentary, I can hardly ignore it.

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Back in February this year, Kraken paid a $30mm fine to the SEC after it had been charged with “failing to register the offer and sale of their crypto asset staking-as-a-service program” and agreed to end crypto staking for US clients.

This isn’t the only run-in Kraken has had with the US authorities and I think it is fair to speculate that relationships between Kraken management and the US are somewhat strained.

Kraken has announced that it has received authorisation from the Central Bank of Ireland to act as a VASP (virtual asset service provider) within the EU:

https://blog.kraken.com/post/18446/kraken-secures-virtual-asset-service-provider-vasp-registration-in-ireland/

Mark Jennings, Kraken’s Head of European Operations, thinks just as we do here at CC Towers:

“Clear and effective regulation is essential for the mainstream adoption of cryptocurrencies. As we bring innovative products and services to market, we’re committed to continuing to work with European regulators to operate compliantly under sensible, forward-looking crypto asset regulation.”

Coinbase and Gemini have also been awarded VASP status.

That sucking sound you can hear is the EU dragging crypto tax dollars across the Atlantic Ocean.

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Mark highlighted the fundamental importance of meeting exacting but achievable regulatory standards:

“Kraken’s Irish VASP registration demonstrates to both our clients and regulators that Kraken follows Europe’s most robust anti-money laundering and compliance standards. Registration further underscores Kraken’s commitment to driving crypto adoption across Europe, now and into the future.”

Which is a timely reminder that today is a milestone day in the crypto world.

The European Parliament in Strasbourg (the whole shebang ups and moves once a month from Brussels to Strasbourg at huge cost to both the taxpayer and the environment merely to satisfy French sensibilities) is voting today on MiCA (Markets in Capital Assets), the world’s leading piece of crypto legislation.

Though guaranteed to pass, some members of the European Parliament refuse to do their homework, exemplified by Irish MEP Chris MacManus:

“I have no interest in creating a market in, or fostering the use of, crypto assets. At their worst, they’re pyramid schemes, are used by criminal gangs for money laundering, are defrauding working people, and they can waste huge amounts of energy for no purpose.”

Those old, prejudiced tropes refuse to go away.