17 Feb 2023

The Friday Focus: Issue 73

In a rather uneventful news week, the SEC stole the show with its ongoing crypto crackdown. Let’s dive into this week’s stories!
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Top storiesThe reports from last week were true, as NYDFS ordered stablecoin issuer Paxos to stop issuing Binance USD. The SEC is planning to sue Paxos over BUSD being an unregistered security. As a result, Paypal has stopped its stablecoin project as well. But that’s not all from the SEC this week, as the Terraform Labs founder Do Kwon is finally getting sued for misleading investors with his TerraUSD stablecoin project. SEC is not in any way done, it seems, with Garry Gensler also proposing new crypto custody rules this week.In other policy news, a US senator is now drafting a proof-of-reserves legislation, and in Canada, reports are saying that new rules are close for crypto exchanges. According to the Indian finance minister, the G20 countries are looking into how they can regulate the crypto industry, and in the EU, banks are already told by the ECB to apply crypto cap rules even before they become law.Many crypto companies are still trying to resolve the scandalous 2022 and adjusting to regulatory changes. Bankrupt crypto lender Celsius is planning a sale to the investment firm NovaWulf, Nexo is stopping its Earn program in the US in April, and both Magic Eden and GSR announced layoffs this week. Bakkt is sunsetting its consumer app and focusing on B2B, reportedly due to the ongoing regulatory crackdown we’re seeing in the US.Luckily some investors are still optimistic about the future of crypto, with several funding rounds this week. Financial giant Credit Suisse led a $65 million Series B for a Swiss digital asset infrastructure company called Taurus, with several exciting names participating. In addition, the NFT marketplace Blur is reportedly raising capital at a billion-dollar valuation. Amazon’s Alexa Fund announced that it is leading a $20 million investment round in the NFT-related company Superplastic, and former Jump Trading developers raised $19 million to build a new layer-1 blockchain protocol called Monad.Short and sweet this Friday - have a great weekend all!
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