Gensler’s testimony on Tuesday could bring regulatory news. XRP rules out settlement with SEC chief. LTC was caught in a “pump and dump” hoax.
Ethereum was back at the $ 3,000 level after a rally failed in the week at the $ 3,600 level.
The cryptocurrency market is experiencing bearish price sentiment due to testimony next Tuesday before the U.S. Senate and Banking Committee by Security and Exchange Commission chief Gary Gensler.
Gensler recently said he would support the issuance of a Bitcoin exchange traded product, but it’s also clear that he’s looking to take the digital currency industry’s breath away with other regulations.
The key area in the regulator’s sights is stablecoins and we may well see comments on that tomorrow. Republican Senator Pat Toomey of Pennsylvania recently asked Gensler if he thought stablecoins were securities under the Supreme Court’s definition of an investment contract called the “Howey’s test.” Gensler declined to give a real answer, saying “it could well be securities.”
Gensler also took aim at the Coinbase exchange, claiming that some of the coins listed on the broker’s platform could also be securities.
In July, Treasury Secretary Janet Yellen called on the President’s Task Force on Financial Markets to address the threat posed by stablecoins to the financial system, saying “it was necessary to act quickly to ensure the establishment of an appropriate regulatory framework “.
However, Gensler’s critics say the SEC chief is rushing to assert his agency’s authority in the market with little legal justification. Dean Steinbeck, general counsel for Horizen, told Marketwatch:
Gensler very clearly wants the SEC to have unlimited crypto powers.
Steinbeck added that he doesn’t believe crypto projects meet the requirements of the SEC’s Howey Test, which states that investors must have a reasonable expectation of profit when buying securities.
Tomorrow’s testimony will be closely watched and should bring volatility to the market.
XRP has come under SEC crossfire this year for the same reason that the regulatory branch accuses the token of being a security.
However, Ripple’s legal team said this week that it has no plans to settle with the regulator. They hope Commission Chairman Gary Gensler avoids investigating the case, which would mean picking winners and losers in the crypto industry and increasing the complexity of the regulator’s role.
Ripple’s legal team told Fox Business they have no plans to settle disputes with the SEC over the XRP status lawsuit, and they are confident they can show Gary Gensler is picking them up. winners and losers in the crypto industry at the expense of innovation in its case. .
In January, Ripple founder Brad Garlinghouse was asked about Ripple’s reasons for not negotiating a deal with the SEC. He has answered:
I can’t go into details, but I do know that we have tried – and will continue to try with the new administration – to address this issue so that the XRP community can continue to innovate, consumers are protected, and the markets. ordered are preserved.
XRP was also caught in the bearish activity this week, with the coin trading below the $ 1.00 mark.
Another project caught in regulatory constraints was the Celsius network.
Various US states have recently taken action against the cryptocurrency lending platform, accusing the company of providing residents with unregistered securities.
It should be clear to cryptocurrency enthusiasts that this is a collective attack on the crypto market by the government to slow the progression of decentralized money and protect the interests of the existing financial system. This is something that I predicted a long time ago.
The Texas securities regulator filed a lawsuit against Celsius Network on Friday, expecting the company to explain why it should not be ordered to stop supplying its products to residents of the state. The court hearing is now set for February 14, 2022.
Additionally, the New Jersey securities regulator on Friday ordered Celsius to stop supplying some of its products, which the state considered unregistered securities. Alabama also issued a similar order requiring Celsius to provide evidence as to why it should not be prevented from supplying its products in the next 28 days.
Celsius held more than $ 24 billion in “community assets” as of September and the crypto firm said those assets under its management would make it the largest provider of interest accounts in the world. The company offers its clients a return of almost 9% for deposits of US dollar stablecoins like USD Coin and Tether, and up to 6.2% for Bitcoin. For the traditional financial system, this is a threat because interest-bearing accounts offer returns below 1% due to the zero percent interest rate strategies of central banks.
The price of the CEL token has slipped near the $ 5.00 level for fear that depositors will cash out.
Finally, Litecoin was caught in a ‘pump and dump’ price action hoax last week over a false report that it was partnering with Walmart.
The fake press release was published by GlobeNewswire and then picked up by larger financial media including Reuters and CNBC.
The statement titled “Walmart Announces Major Partnership with Litecoin” claimed that the world’s largest retailer planned to accept LTC as a payment method from October 1.
The price of Litecoin rose sharply after the release, with the coin surging 30% from $ 170 to $ 230. However, a subsequent statement from Walmart said it had “no partnership” with the digital coin.
Walmart had no knowledge of the GlobeNewswire press release and there is no truth to it. Walmart has no relationship with Litecoin.
Litecoin has since been pulled down to trade around the $ 160 level.
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