hmmm
"The more interesting news yesterday was in crypto. SEC is suing Ripple and calling XRP an unregistered securities offering. This is a landmark lawsuit which will have serious implications for crypto going forward. It is not unusual for the US government to launch major anti-trust action in the waning days of an administration. The US vs IBM lawsuit was filed in Jan 1969 in the last days of the Lyndon B Johnson administration after a crazy 1968 year when Martin Luther King and Robert F. Kennedy were assassinated and Nixon was elected. That government lawsuit broke IBM’s monopoly on the computing business during the Nixon and Ford years and led to the creation of Microsoft, Intel, Apple and the entire US personal computer industry that we know today. So these type of lawsuits filed at the end of an administration matter and they matter a lot. It will be a mistake to consider this a lame-duck lawsuit. It will be continued in full force by the next administration.
Ripple is singled out here because it is a private sector company and their crime was that they dared to print a currency which is the privilege of the US government. The US government wants to make an example of Ripple that private sector entities should not be in the business of creating currencies. It will be easy for the US government to prove their case because Ripple was trying to get banks to use XRP as a cash replacement by paying them. The SEC is being very tough in this lawsuit. They are prosecuting directly the CEO and top players in Ripple and will accuse them of securities fraud. They will ask them to return the money from the token sales and will force them to pay penalties. In effect, Ripple will be destroyed and with it, its XRP token. The US government will force all the crypto exchanges to delist XRP. So if you have any XRP, you have to get rid of it and don’t think about buying it again. This thing is going to zero.
What are the consequences of this lawsuit for the crypto industry? The first thing I can think of is that the SEC will treat crypto as securities (like stocks) as opposed to commodities, bonds or currencies. That means you will have to report and pay capital gains on your crypto transactions just like you do with stocks. I guess retail investors are kind of ready for that anyway if they invest via Kraken or Coinbase. But this is a more far reaching determination than appears at first from a different perspective. This determination means that the risk weighting for crypto as a financial instrument will never as low as Gold, cash or government bonds. Crypto is Tier 3 capital. It will never be Tier 1 capital like Gold, cash and government bonds. That means that the dream that Bitcoin will be on Central Bank balance sheets is simply NOT going to happen. Bitcoin will never be like Gold, a Tier 1 central bank asset.
The 2nd thing is that the SEC will go after public and non-public companies that invest into cryptocurrencies and charge them if they don’t do proper disclosures and follow investor protection guidelines. The first thing that comes to mind here is Michael Saylor of MicroStrategy who decided to put his company’s corporate cash into Bitcoin. The US government will not consider Bitcoin a cash substitute and Saylor will run into trouble for using Bitcoin to store corporate cash. MicroStrategy is likely to be hit next and Saylor will be forced to sell the Bitcoin. So I think we have big Bitcoin sales on the horizon. Obviously, Saylor is more than welcome to become an investment manager where he can invest in Bitcoin and have an investment fund or ETF that has passed SEC approval. But the pipe dream that S&P 500 companies will be allowed to invest their corporate treasury money into Bitcoin is over. SEC is making it clear that crypto will not be allowed to be used on corporate balance sheets."
Послали сте Данас у 10:59
"The SEC lawsuit means that Facebook’s Libra is over before it even starts. While I can see the SEC being ok with USD pegged stablecoins like USDC or USDT as US dollar substitutes and various cryptos as equivalent to stock market investments, I don’t think the Fed will allow companies to create their own cash substitutes. And Libra is Facebook’s cash substitute. Facebook’s Libra is not a stablecoin pegged to the USD but to multiple currencies with its own formula. Regardless, Facebook meant Libra to be a cash substitute and the SEC simply won’t allow that. So Facebook’s Libra is out. Stellar is also going to get nailed by this because XLM is also a cash substitute.
To summarize, XRP, XLM and Libra are dead.
We likely see a big selloff in Bitcoin as the SEC forces Michael Saylor’s hand. As a result all other crypto sells off. But I think that is simply the next buying opportunity for our Gen 3 POS crypto. Neither Cardano, nor Polkadot, nor Algorand have any similarity to Ripple. They never were meant to be cash substitutes but tokens used to power a cloud computing network so they will be treated as securities (like Microsoft stock). The founders of these networks know all of that stuff and they know to stay away from money printing power of sovereign governments.
As soon Yellen comes around, Bitcoin and Ethereum will be assessed carbon taxes. This SEC lawsuit against Ripple is the beginning of the regulation of crypto. And once crypto gets regulated, the Proof-of-Work consensus carbon footprint will become a major issue for the governments in Europe and the US. So some form of carbon taxation for Bitcoin and Ethereum transactions will be the minimum we will see. Bitcoin can crash big time here. I won’t be surprised if Bitcoin drops to $10,000 and below in coming months. Once Bitcoin sells off, it will selloff fast. All that institutional buying of Bitcoin can stop on a dime if the SEC halts it. And we know that Bitcoin drags the whole alt-coin complex with it. So be ready for a big dip."
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