22nd April 2025 > > The SEC & the Fed.

tl;dr

The new Chair of the SEC is sworn in, marking the start of a golden age of regulation for cryptos. The myth of central bank independence is being slowly dismantled, for everyone’s benefit.

Market Snap

Market Wrap

Stocks are taking a battering in an irrational and short-term response to the growing realisation that the myth of central bank independence was always just that – a myth (see below for more details).

Hard assets including BTC are the obvious beneficiaries of this more truthful understanding of how the world works.

Curious Cryptos’ Commentary – Paul Atkins, new Chair of the SEC

Having been nominated by Trump to replace the hapless Gensler at the helm of the SEC, Paul recently sailed through his confirmation hearing and was sworn in as the 34th Chair of the SEC yesterday.

This is superb news. The SEC under acting Chair Mark Uyeda has been dismissing lawsuits against the crypto industry left, right, and centre. The Crypto Task Force, headed by Hester Peirce and reporting back to Paul in July, is already hard at work. Paul sets out his agenda starting today:

”Together we will work to ensure that the U.S. is the best and most secure place in the world to invest and do business.”

Look and weep, Gensler.

With regards to cryptos, Paul’s in-tray currently has over 70 applications for spot ETFs, some of which are frankly ridiculous (2x MELANIA anyone?). Paul will reject a lot of these spurious attempts at bringing some of the more obscure reaches of the crypto universe into the mainstream, and rightly so. What we will see – and I am very confident in making this prediction – are spot ETFs on larger cap coins such as SOL, XRP, LTC, and DOGE, amongst others. For those coins with PoS consensus mechanism, staking will be allowed within the ETF, significantly benefiting investors.

2025 is just starting to shape up, regulatory wise.

Curious Cryptos’ Commentary – Trump & the Fed

Much is being made in the popular press about Trump’s antagonism towards the Fed, and its Chair, Jerome Powell. The great and the good are all lined up decrying this attack on the supposed independence of central banks, one of the world’s greatest myths perpetrated on an unsuspecting public since the Fed was separated from the executive arm of the US government in 1913.

Two recent events have categorically proved that central banks are at the whim of their political masters.

Firstly, Covid. I am not here to debate the merits or otherwise of lockdown. I am not here to debate the merits or otherwise of the decision by central banks to ramp up QE to unprecedented levels in response. But what is very clear is that regardless of your political views on both points, financial stability and controlling inflation (two key objectives of all central banks) were jettisoned by the decision to print money whilst shutting down the economy. The central bank governors knew that but went ahead anyway. In the UK there was even a signed agreement between the Bank of England and then chancellor George Osbourne as to the mechanics of QE during lockdown. QE was a political decision driven by the political masters of the central banks.

Secondly, Brexit. I am not here to debate the merits or otherwise of Brexit. However, when Mark Carney, then head of the Bank of England, inserted himself in the middle of the political debate about Brexit, he advertised to the world that the Bank of England is a political animal, and not independent of the government.

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If you are still not convinced, then perhaps the Fed itself can do a better job than I.

On the Fed’s own website, it describes itself as “independent WITHIN government” not “independent OF government”:

https://www.federalreserve.gov/faqs.htm

Game, set, and match.

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In the short-term, as the world starts to accept the reality that central banks are at the whims of their political masters, there will be some financial disruptions as the previous naïve and cosy consensus falls victim to the harsh realities of the world. Recent stock market moves are partly driven by this growing realisation. In the long run, the world will be in a much better place for it.

Meanwhile, the case for BTC gets ever stronger.