BitDigest March 26 · Issue #623

Mar 26, 2020
  • Crypto prices inched downwards overnight as bitcoin dominance re-hit the 66%
  • Mt. Gox’s rehabilitation trustee suggests an initial cash settlement could be coming
  • International security commissioners finds that stablecoins appear likely to be securities and should fall under their jurisdiction
BitDigest March 26 · Issue #623
BitDigest March 26 · Issue #623

The Headlines

BitDigest March 26 · Issue #623

News from Mt. Gox Creditors Meeting

www.mtgox.com
At yesterday’s Mt. Gox meeting the Trustee announced he would liquidate all forked coins excluding bitcoin (BTC) and bitcoin cash (BCH) in an effort to assist the creditors as many creditors did not have access to exchanges that traded these tokens. More importantly, I was told that the 80k BTC claimed by Tibanne, the legal parent corporation of Mt. Gox, has been dismissed and that the Trustee is considering distributing funds to the claimants in multiple steps starting with the original cash generated from the previous sale of bitcoin. Finally, it appears that the zombie assets which have not yet been claimed will remain with the Trustee in cash the original claimant files at a later date. The next step is for the updated rehabilitation plan to be reviewed by the court and then voted on by the creditors.
BitDigest March 26 · Issue #623

Organization of Security Commissioners Finds Stablecoins 'Likely' Fall Under Purview of Regulators

www.iosco.org
The International Organization of Securities Commissions (IOSCO), the association of agencies regulating the world’s securities and futures markets, issued a report citing that stablecoins perform systemically important payment system functions and likely fall under the purview of securities regulators, but should still be reviewed on a case-by-case basis.
BitDigest March 26 · Issue #623

Telegram Appeals Injunction

www.courtlistener.com
Not unexpected, Telegram has appealed the court decision for preliminary injunction against the social messaging company’s ability to deliver its Gram tokens to investors. The court found that the tokens failed the Howey Test and were in fact securities.
BitDigest March 26 · Issue #623

Prosecutors Call OneCoin Attorney's Appeal 'Meritless'

www.courtlistener.com
Federal persecutors responded to the appeal of former OneCoin attorney Mark Scott by saying the defendant’s argument that the government’s evidence was insufficient and that the claim that the case should not be argued under federal bank fraud laws as both being “meritless.” Scott was found guilty of laundering over $400 million in the $4 billion pyramid scheme’s profits. I find the story of OneCoin to be very interesting; it’s like an episode of CNBC’s American Greed. What surprised me more about it, is that even though they are accused of stealing over $4 billion from global investors, I never even heard of onecoin till I started reading reports of a potential pyramid scheme and disappearance of Ruja Ignatova, ‘the CryptoQueen,’ in late 2018. If you want to know more about OneCoin, NPR’s Planet Money ran a good podcast on the story. The BBC produced a longer series, “The Missing Cryptoqueen,” but NPR’s is a good summary of the BBC’s work.
BitDigest March 26 · Issue #623

Further Arguments in the Wright – Kleiman Case and a Requested Delay

www.courtlistener.com
Craig Wright has objected to the court’s decision to dismiss his attorney-client privileges in the case filed by the estate of his former friend and partner, Dave Kleiman. The new filing suggests that the court disregarded the attorney-client relationship given “preconceived and previously formulated conclusions of defendant’s character” following accusations that documents filed by Wright were forgeries. In additional news, the estate of Dave Kleiman has filed a motion asking for a two-week extension (which is likely to be extended) to complete three additional witness depositions. The estate said it would be unable to meet its original schedule due to the outbreak of the coronavirus pandemic.

Market Data

BitDigest March 26 · Issue #623

Bitcoin Hashrate Drops 30% in 24-Hours

www.bitinfocharts.com
Bitcoin’s hashrate has sharply declined 29.6% to 75.6 Ehash/s over the past 24-hours hitting its lowest level this year. The cause of this is still unknown, but could miners taking rigs offline given the recent sell off in bitcoin, or it could also be large rig manufacturers changing their units out with more efficient rigs that have yet to be delivered to the market – a sudden pick up in hash rateover the next few days would likely signify the latter occurred.
BitDigest March 26 · Issue #623

Genesis Capital Experienced No Losses or Defaults During Crypto Sell-Off

www.genesistrading.com
Genesis Capital CEO Michael Moro issued a brief update on the lending market ahead of the typical quarter-end release. Moro explained that Genesis experienced no capital losses or defaults from borrowers during the second largest intraday price drawdown in bitcoin’s history. He currently sees markets starting to normalize as new issuances are generated with increased collateral requireemnts.
BitDigest March 26 · Issue #623

$1 Trillion in New Capital Could Flow into Bitcoin Over the Next 25 Years

www.kraken.docsend.com
Kraken issued a report (piggybacking on Fundstrat’s previous work) suggesting that the upcoming $70 trillion wealth transfer to more digitally native Generation Xers and Millennials should drive a shift in investment trends leading to an increase in bitcoin. The exchange suggests that more than $1 trillion in wealth could flow into bitcoin over the next 25 years.
BitDigest March 26 · Issue #623

Ashburn, VA has the Highest Crypto Users Per Capita in the US

www.cointracker.io
CoinTracker issued a report “Ranking the Top Crypto Cities in America” and found that Ashburn, VA, Redmond, WA, and San Francisco have the most crypto users per capita and that San Fran, Palo Alto and Oakland have the highest wealth in crypto holders per individual using the platform.
BitDigest March 26 · Issue #623

Binance Issues Introductory Report on Ethereum Classic (ETC)

www.research.binance.com
Binance Research has published an introductory report on ethereum class (ETC) suggesting that the original ethereum protocol will continue as the “immutable Proof of Work version of ethereum” following Ethereum’s switch to Proof of stake (ETH 2.0)

Exchange, Custody and Product News

BitDigest March 26 · Issue #623

Coinbase Brings DeFi Integration to Wallet

www.blog.coinbase.com
Coinbase announced that its online, digital wallet will now allow users to lend digital currencies to decentralized finance (DeFi) apps allowing the user to earn interest. Coinbase has integrated DeFi apps into their Coinbase Wallet allowing users to compare different rates and deposit and track holdings through their unified dashboard.

Reports you may have missed

Crypto markets are declining following news that most of the SEC’s lawsuit against Coinbase will proceed (more below). BTC (-1.27%) reached intraday highs of $71.8k before declining to $69k after the news. Rumors have circulated that Morgan Stanley and PNC will soon approve access to Bitcoin ETFs on their wealth management platforms. Together, Morgan Stanley and PNC hold over $1.5 trillion in client assets and likely will provide a tailwind...

Following the worst week of ETF flows since inception, BTC (+3.89%) is rebounding, rising to $69.6k, and ETH (+4.09%) has reclaimed the $3,500 mark. Last week’s outflows totaled $888 million, representing about a fifth of the inflows seen in the previous two weeks. ONDO, an institutional RWA protocol, is one of the top performers today, rising 7.61% as investors remain optimistic about the future of tokenized assets and their ability...

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