Daily Digest - 9th May 2023

Headlines

▌Bittrex: Estimated liabilities and assets are between $500 million and $1 billion

Exchange Bittrex believes it has more than 100,000 creditors, with estimated liabilities and assets of between $500 million and $1 billion, according to a court document shared by Randall Reese of bankruptcy tracker Chapter 11 Dockets. As previously reported, Bittrex filed for bankruptcy in the United States, and the bankruptcy announcement will not affect Bittrex global companies.

Policies

▌The Blockchain Association calls on the US SEC to revise the regulatory rules for encrypted custodians

Crypto industry group the Blockchain Association filed a comment letter in response to the US Securities and Exchange Commission (SEC) regulation. The letter argues that the proposed rule’s requirements for qualified custodians, among other things, would prevent native custodians of digital assets from continuing to provide custody services, which would reduce rather than increase protections for advisory clients. In February, the US SEC proposed changes to its regulatory rules. The changes would expand the scope of the rules beyond client funds or securities and would cover client assets under investment advisors. The Blockchain Association argues that, for now, the rule needs to be revised to “adequately account” for the characteristics of digital assets, and it recommends that the SEC allow advisors to use trading platforms that are affiliated with qualified custodians and subject to an appropriate degree of regulatory control.

▌Belgian regulator: Bit4You faced lawsuits or registration issues before suspending operations

Belgium’s oldest cryptocurrency exchange, Bit4You, was already facing litigation or registration issues before it announced the suspension of platform activities in April, Belgium’s Financial Services and Markets Authority (FSMA) said in a statement. In its statement, the FSMA said it had notified Bit4You of its intention to reject its registration request in advance, even before the cryptocurrency exchange requested to revoke its provisional registration on May 2. Prosecutors were notified of management’s violations,” adding that the company was thus “forced to revise all of its governance structures” following the regulator’s findings. In an April 26 blog post, Bit4You said it had suspended its activities due to the insolvency of its service provider, CoinLoan, and subsequently filed for receivership in a Belgian court.

Cryptocurrency

▌The Bank of Canada opens public consultation on the digital Canadian dollar

The Bank of Canada is exploring the possibility of issuing a central bank digital currency (CBDC) and has opened a public consultation on the digital Canadian dollar. Canadians have until June 19 to discuss how to use the digital Canadian dollar, what security features should be implemented, and citizens' opinions on the digital currency like submitting a comment on possible concerns of issuing a CBDC. The Bank of Canada stated that the goal of the digital Canadian dollar is to “complement cash, not replace it,” and while the bank does not believe a CBDC is needed “now,” it acknowledges that it may be required in the future, so the bank wants to be prepared.

▌Coinbase CEO Steps Up Criticism of SEC Chairman

Armstrong stepped up his criticism of Securities and Exchange Commission (SEC) Chairman Gary Gensler. Armstrong said: "The SEC is a bit of a maverick in this regard. Chairman Gensler is a lone crusader. For some reason, he has adopted a more anti-cryptocurrency view." But Gensler filed some lawsuits, which I think is very unhelpful for the crypto industry in the United States, but this is also an opportunity for Coinbase to get clarification from the courts, and we think this will really benefit the crypto industry and benefit more Broad America. Armstrong also added that despite the regulatory uncertainty the company faces in the US, the exchange will not be leaving the US.