SEC Delays Decisions on Ethereum ETFs; Binance.US Faces Challenges; Crypto Lender Abra Sets for Settlement
Summary:
The Securities and Exchange Commission (SEC) delayed decisions on spot Ethereum ETF proposals from BlackRock and Grayscale Investments, citing a need for further review. Meanwhile, the Financial Industry Regulatory Authority (FINRA) discovered that nearly 70% of public crypto communications might be violating law guidelines. Florida and Alaska prohibited crypto exchange Binance.US from operating due to its former CEO's guilty plea. Finally, financially struggling crypto lender Abra reached a tentative settlement with the Texas State Securities Board (TSSB), agreeing to return invested assets to the state's citizens.
The U.S. Securities and Exchange Commission (SEC) postponed a decision on BlackRock's proposed spot Ethereum Exchange-Traded Fund (ETF) on Jan. 24, just a day before the final call was due. The delay is attributed to a need for further examination of the suggested legislative alteration. Pundits, including Bloomberg ETF analyst Eric Balchunas, maintain that the SEC's definitive judgment regarding BlackRock's spot Ether (ETH) ETF proposal, scheduled for Aug. 7, will likely come in May. This follows the pattern observed in January with similar decisions on 10 pending spot Bitcoin (BTC) ETFs.
Moreover, the SEC pushed back its decision on approving a spot Ether ETF by Grayscale Investments on the following day, making room for public commentary on the application. The SEC says it will conduct proceedings to ascertain whether to sanction or repudiate a suggested rule variation enabling the NYSE Arca to list and trade Grayscale Ethereum Trust shares. This method of soliciting public input will prolong the decision-making process by an additional 35 days post-publication in the Federal Register.
The SEC has been consistently viewed as a resistant authority against cryptocurrencies in the U.S. As per a Cornerstone Research report, regulatory actions related to cryptocurrencies in 2023 were at their peak since 2013, indicating this segment gained significant focus by the commission. From 46 enforcement actions in 2023, Cornerstone reports the SEC imposed an aggregate of $281 million in penalties and tripled administrative proceedings from 2022.
On a different note, the Financial Industry Regulatory Authority (FINRA) intimated that about 70% of public crypto communications infringe the law. A review of more than 500 crypto related retail communications commencing November 2022 helped identify a probable violation of 70% communications correlating to FINRA's public interaction regulations.
Down south, both Florida and Alaska have ordered Binance.US to discontinue operations within their jurisdictions. These mandates have come in the wake of former Binance CEO Changpeng Zhao's plea of guilt. The crypto exchange's operating license renewal was alleged to be refused by the Alaska Division of Banking and Securities in January 2024. Meanwhile, Florida’s Office of Financial Regulation temporarily suspended Binance.US’s money transmitter license.
Crypto lending company, Abra, which has reportedly been in financial difficulty since March 2023, agreed to a tentative settlement with the Texas State Securities Board (TSSB). As per the settlement, Abra is set to return the invested assets of the state citizens. The pact also indicates Abra's decision to scale down its U.S. retail operations. Unclaimed assets will be converted into fiat currency and given back to residual Texas investors. The company held crypto worth $13.6 million for more than 12,000 investors in the U.S., with a minor portion ($1.8 million) belonging to around 1,600 Texans.
Published At
1/29/2024 11:00:00 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.