Paxos sued by the SEC, India takes lead on global crypto regulations, Coinbase defends staking services

SEC sues stablecoin issuer Paxos

In yet another regulatory development out of the States, the Securities and Exchange Commission (SEC) has issued a Wells notice to stablecoin issuer Paxos. The market watchdog sends Wells notices to people or firms when it is planning to bring an enforcement action against them. The document alleges that Binance-branded Paxos-listed stablecoin BUSD is an unregistered security.

The allegation echoes that of several legal actions taken by the SEC over the past year. The regulator, for instance, charged the bankrupt crypto lender Genesis Global Capital and the exchange Gemini Trust, run by Cameron and Tyler Winklevoss, with selling unregistered securities in January. Last week, the SEC levied similar charges against crypto exchange Kraken and forced it to dismantle its US-based crypto staking product and to pay a $30 million settlement

Blackrock ETF Token launches; unavailable in US

Swiss company Backed Finance has launched a tokenised copy of mega-conglomerate Blackrock’s CSPX exchange-traded fund (ETF). The company’s token is called bCSPX. Blackrock’s ETF includes shares of over 500 large American companies such as Apple, Amazon and Alphabet. Backed Finance claims that those shares are backed one for one, which is industry parlance for saying that each product is backed by the underlying asset. The token acts as an on-chain representation, much like a derivative, of real world asset, or RWA, in this case being a popular ETF. For Backed Finance to achieve this, the firm must own an actual share of the ETF for every token it distributes. Despite the potential appeal of such assets to some investors, the token will not be made available in the US, which is unsurprising amidst the wave of enforcement actions mentioned earlier.

India looking at global crypto regulation discussion at G20

India is vying to take a leadership role in crypto regulations among G20 countries this year by pushing for standardisation among nations. Finance Minister Nirmala Sitharaman expressed the need for countries to adopt a common set of procedures for policing digital assets as India’s holds the presidency of this year’s international summit. The call to action follows similar statements made by IMF members last month.

Surojit leaves Coinbase for a16z

Former Coinbase executive Surojit Chatterjee has moved to venture capital firm Andreessen Horowitz (a16z). In a Friday tweet, Chatterjee expressed excitement in his new role as Executive in Residence, another high-profile position following his tenure as chief product officer at Coinbase and VP at Google. VC firm a16z has had a spotty history in the crypto industry, having backed projects like now defunct blockchain Rally.

Coinbase insists staking services not securities; CEO ready for court battle

Coinbase is firing back at the SEC in an open policy letter, decrying the agency’s ongoing attack on staking products. The company suffered some of its worst daily losses in months following SEC action against fellow staking provider Kraken last week. The Coinbase’s stock price fell from $59.63 on Thursday to $57.09 on Friday. Coinbase’s letter cites the SEC’s own Howey test, which determines whether a contract meets conditions required to be a security, as evidence that the SEC is overreaching. Coinbase CEO Brian Armstrong supplemented the open letter with a Sunday tweet, vowing to meet the SEC in court over the matter.

DCG shuffling assets to appease creditors

Crypto giant Digital Currency Group (DCG) is moving around equity in an attempt to offload bankrupt subsidiaries Genesis Global Holdco and Genesis Global Trading. In a proposal submitted Friday, DCG is asking a bankruptcy court to allow it to move equity from Genesis Global Trading to Genesis Global Holdco, in order to sell both companies and make headway with creditors. The companies, part of founder Barry Silbert’s DCG empire, were left thoroughly in the red following the collapse of exchange FTX in September of 2022.

Brazil bank accepting crypto tax payments

Banco do Brasil, one of Brazil’s oldest banks, announced Saturday that it will accept crypto payments for tax purposes. This marks another step forward for Brazil, a country which has implemented a series of crypto-friendly laws in the past year.

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