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Who is Gary Gensler, The Rumored New SEC Chair?

Gary Gensler teaching blockchain“The year is 2021, and the nation is in crisis. North Korea has just tested a missile that will soon be capable of delivering a nuclear warhead to the continental…

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“The year is 2021, and the nation is in crisis. North Korea has just tested a missile that will soon be capable of delivering a nuclear warhead to the continental U.S. The move took Washington by surprise as the project was likely funded via a new Chinese digital currency, which allowed North Korea to bypass the global banking system. In response, the National Security Council House has gathered in the White House Situation Room to formulate short- and long-term responses.”

That is the opening of a 2019 simulation on ‘Cryptocurrency and national insecurity’ in which Gary Gensler, who is rumored to be the new chair of the Securities and Exchanges Commission (SEC), took part.

Ignoring the dramatic angle of this simulation, much of it has become real now two years on. The dollar is no longer the only convenient means of international exchange. American banks are no longer the policemen of global monetary transfers.

As a catalyst of change, bitcoin and cryptos more widely are re-shaping global finance and global trade. The question is: what does the United States do about it?

The Banker Academic

Gensler spent much of his life working for Goldman Sachs, with little known about the man except he also spent plenty of his time in the power halls of Washington.

As chair of CFTC, he reformed the institution and woke it up to the challenge of regulating the $400 trillion derivatives market.

Soon after, he went to MIT where he taught on global finance and blockchain tech, with some papers suggesting he is effectively obsessed with this new invention.

“I remain intrigued by Satoshi’s innovation’s potential to spur change – either directly or indirectly as a catalyst,” Gensler said in late 2019, adding:

“The potential to lower verification and networking costs is worth pursuing, particularly to lower economic rents and data privacy costs, and promote economic inclusion.

Further, shared blockchain applications might help jumpstart multiparty network solutions in fields that historically have been fragmented or resilient to change.

Even in this slightly less ambitious form – acting as an innovative irritant to incumbents and traditional technologies – cryptocurrencies and blockchain technology have already prompted real change and can continue to do so.”

A Friend?

The above statement is just one of many that indicate Gensler is a believer as far as the technology is concerned, and we have no reason to doubt it.

There’s a but, or quite a few of them. Where bitcoin is concerned, he considers it just a speculative asset class. A very unsophisticated view in light of the immense sophistication that bitcoin contains.

On ICOs, he said the thousands of them issued in 2017 are all securities and went so far as to court a response from Coin Center after suggesting even eth is a security.

Ethereum however is now decentralized he said so might get away with a commodities classification, as happened, but XRP is definitely a security in his view.

As someone intimately familiar with the blockchain, a more interesting question for him to answer is: what does a security mean in the digital age, or better, in the crypto age?

Jay Clayton’s answer was that it means nothing different to what it meant a century ago during the age of horse carriages.

Gensler’s answer can’t be the same, for it would contradict his own statement, and thus presumably belief, that this technology is a change catalyst.

A Reformer?

If Gensler is indeed appointed, he will become the third most powerful person on the economy after Biden and Yellen.

He will be in command of a $20 trillion economy where entrepreneurship is in steep decline, IPOs have fallen, and where tech companies are concerned, they have scathing critiques of the current securities framework being incompatible with new digital businesses and their necessities.

The young across the world are outraged at the investment prohibitions enforced by the law, an outrage that may have well contributed to the 2019 year long protests in France.

Making this a fiery time to be SEC chair and yet a time of great opportunity because the institution is in desperate need of reform and due to its adverse effects on the economy, is under immense pressure to adapt.

As Gensler well knows, there are no rulers without the consent of the ruled, and there are no laws without their general appreciation.

This is something Clayton did not understand. He was of the view that no change was needed even though the world has greatly changed. He thought he could dictate.

Gensler appears to be very different from Clayton. First of all, he doesn’t come across as the school yard bully. Nor does he come across as completely uninformed and dare we say: stupid.

So we should be expecting a very different approach from SEC, but it isn’t very clear just how different considering he has said utility tokens are a fiction.

To help him, we’ll go back to this simulation and give our advice to the president, but this time the events are not unfolding, instead is what we told him two years prior.

The Immortal Race

You have two choices: fight or run. You can fight this technology, you can constrain it, delay it, maybe even injure it, and focus fully on maintaining the supremacy of the current framework, strengthen banks and their role, and promote this new technology only in the context of banks using it.

This can buy some time while the bank rails are upgraded, to the point eventually it may be possible to issue a crypto dollar, but that is difficult to do in a way we can control.

In addition, there are potential externalities. We can fight this only within USA. Other countries might adopt it and might even see strategic value in doing so. That’s a big risk, but you might think we can’t let our banks go the way of blockbuster.

Unless it’s our blockbuster-er. As this is a technology that anyone can put together, the only way we can maintain supremacy is to ensure we have the highest level of expertise, experimentation and even implementation of this technology.

Then, the free market can provide a crypto dollar and since those issuers would be within our jurisdiction, we can regulate them just as we do banks.

In the end, whether it’s a traditional bank or a tech bank is far less relevant than whether the best of them are American ones. To us, to the government and to the country, it makes no difference.

So instead of fighting it, you can run in the race for technological progress and do your best to win because that’s the only option that ends up with a chance of maintaining our most advanced level of development.

Your administration therefore must not only accommodate, but promote the unstoppable march of technological innovation, and know that only by doing so can we not only maintain, but enhance our global standing.

If you do so, then the superiority of our products will naturally attract global usage. If you don’t, then the inferiority of analogue dollars will naturally cause the global adoption of digital and crypto moneys which may well be issued by another country.

Blockchain

Ethereum Price Moves up to $1,200 as Demand Threatens to Outstrip Supply on Exchanges

The price of Ethereum, the second-largest cryptocurrency by market capitalization, has moved back up to the $1,200 mark after falling below $1,000 earlier this week at a time in which outflows from cryptocurrency exchanges suggest demand could outstrip supply. According to Nuggets News’ Alex Saunders, data shows that exchange reserves have fallen by 3 million […]

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The price of Ethereum, the second-largest cryptocurrency by market capitalization, has moved back up to the $1,200 mark after falling below $1,000 earlier this week at a time in which outflows from cryptocurrency exchanges suggest demand could outstrip supply.

According to Nuggets News’ Alex Saunders, data shows that exchange reserves have fallen by 3 million ETH over the last two days, with 1 million ETH leaving crypto trading platforms on January 14, and 2 million leaving them the following day.

Saunders shared data from on-chain analytics firm CryptoQuant and pointed out that at this rate exchanges could soon run out of ETH.

Price predictions for ETH have been extremely bullish – with former Goldman Sachs executive and Real Vision CEO Raoul Pal saying he believes Ethereum could go to $20,000 this cycle based on Metcalfe’s law – and as such Saunders believes HODLers will not be selling their funds between $1,000 and $2,000 per ETH.

Some other data providers seemingly show that Ethereum reserves on cryptocurrency exchanges have dropped by 42.5% since mid-May. The analyst interprets the data as suggesting an incoming bull run to a new all-time high for ether, as “we all know what happened when demand outstripped supply of BTC.”

The price of bitcoin surged from about $12,000 to a new all-time high near $42,000 after reserves on exchanges dropped by about 4.5% and corporate adoption surged as MassMutual, MicroStrategy, Square and others bought BTC as a hedge against inflation and currency debasement.

Rafael Schultze-Kraft, CTO at data firm Glassnode, countered Saunders saying his data was “nonsense,” saying that a sudden drop of over 2 million ETH from a cryptocurrency exchange weren’t withdrawals, and that “exchange flows are completely within their normal range.”

It’s believed the 2 million ETH were moved to a new Bitfinex cold wallet for Ethereum that cryptoQuant did not account for. That, however, does not explain the 1 million ETH outflows seen the day before.

It’s worth noting that the decentralized finance (DeFi) space has been booming, and more Ethereum users could simply be withdrawing their funds to interact with these protocols on-chain.

Featured image via Unsplash.

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Blockchain

DOGE Breaks Out and Aims for Prices Above $0.01

This is a short/medium-term analysis. For a longer-term analysis, click here. Breakout and Retest DOGE has been decreasing alongside a descending resistance line since Jan. 2, when it reached a high of $0.014. After three unsuccessful attempts, it finally broke out on Jan. 14. However, DOGE has failed to increase significantly since the breakout, and … Continued

The post DOGE Breaks Out and Aims for Prices Above $0.01 appeared first on BeInCrypto.

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The Dogecoin (DOGE) price has broken out from a descending resistance line that had been in place since the beginning of Jan. DOGE should continue increasing towards $0.018 and possibly $0.021.

This is a short/medium-term analysis. For a longer-term analysis, click here.

Breakout and Retest

DOGE has been decreasing alongside a descending resistance line since Jan. 2, when it reached a high of $0.014. After three unsuccessful attempts, it finally broke out on Jan. 14.

However, DOGE has failed to increase significantly since the breakout, and is currently trading between support and resistance at $0.008 and $0.01, respectively.

The latter is the 0.5 Fib retracement level of the entire downward move and a horizontal resistance area, so a breakout above would confirm the bullish trend.

Technical indicators are bullish and support the possibility of a breakout.

Breakout
Chart By TradingView

The shorter-term two-hour chart further strengthens the possibility of a breakout.

DOGE has been following a short-term ascending support line since Jan. 11 and has flipped the $0.009 support level.

As long as DOGE is trading above these two levels, the short-term trend is bullish.

Short-Term
Chart By TradingView

Doge’s Wave Count

Cryptocurrency trader @DlinkBull outlined a DOGE chart showing a parallel channel. They suggest an increase toward $0.03.

As seen in the first section, DOGE has already broken out from the resistance line of this channel.

DOGE Breakout
Source: Twitter

DOGE seems to have begun a bullish impulse at the beginning of March (shown in white below), currently trading in wave 3.

The sub-wave count is given in orange, and DOGE is likely in the fifth and final sub-wave. A fall below the sub-wave 1 high at $0.0044 would invalidate this particular wave count.

Sub-wave 5 should end between $0.0181-$0.0184, a target found using an external retracement on sub-wave 4 and projecting the length of sub-waves 1-3 to the bottom of 4.

Afterwards, the entire impulse would likely complete at $0.021, the 4.61 Fib extension of wave 1.

DOGE Wave Count
Chart By TradingView

Conclusion

To conclude, DOGE’s rate of increase should accelerate once it moves above $0.01, with a possible target of $0.018.

For BeInCrypto’s latest Bitcoin (BTC) analysis, click here!

Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto.

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Valdrin is a cryptocurrency enthusiast and financial trader. After obtaining a masters degree in Financial Markets at the Barcelona Graduate School of Economics he began working at the Ministry of Economic Development in his native country of Kosovo.
In 2019, he decided to focus full-time on cryptocurrencies and trading.

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Source: https://beincrypto.com/doge-breaks-out-and-aims-for-prices-above-0-01/

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Blockchain

Tether (USDT) January 15th Deadline on iFinex Case: Everything You Need to Know

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Many in the cryptocurrency field have recently discussed the upcoming January 15th date as an important consideration for the ongoing case between the office of the New York Attorney General (NYAG) and iFinex, the parent company of Bitfinex and Tether.

With this in mind, below is a comprehensive summary of what happened and what to expect on this date.

The NYAG v. iFinex Case: What Happened?

Back in April 2019, the office of the New York Attorney General alleged that the popular cryptocurrency exchange Bitfinex lost $850 million and then used funds from its affiliated stablecoin operator Tether (the company that issues USDT) to cover the shortfall.

As CryptoPotato reported, later on, Tether issued a statement through a blog post which said that the allegations were written in “bad faith” and were also “riddled with false assertions.”

In May 2019, Judge Joel Cohen granted a partial stay on the NYAG office’s request for documents from the two companies until their hearing takes place on July 29th. During that hearing, the judge on the case, Joel Cohen, decided to extend the preliminary injunction as he was not ready to make a final decision on whether the case should go forward or be dismissed. Hence, he extended that injunction by 90 days.

In August, however, the NYAG presented new evidence on the case, alleging that apart from covering up the $850 million, Bitfinex and Tether had served New York customers for longer than they claimed. In part, the document stated:

The OAG has uncovered substantial ties between Respondents and New York concerning Respondents’ corporate operations; trading on the Bitfinex platform; the issuance, redemption, and trading of tethers; use of financial institutions to move money and process customer deposits and withdrawals; and representations to the market that might have been misleading.

Essentially, the NYAG also attacked Bitfinex’s LEO initial exchange offering, claiming that it “has every indicia of a securities issuance subject to the Martin Act, and there is reason to believe that the issuance is related to the matters under investigation,” meaning the alleged cover-up.

Additionally, the NYAG called iFinex’s motion to dismiss “an improper attempt to impede a lawful investigation.”

The Order to Turn in Documents

In September 2020, Judge Cohen ruled that Bitfinex and Tether must turn over documents detailing their financial relationship and history to the NYAG’s office. In addition to that, he also extended an injunction that barred Tether from loaning funds to Bitfinex by 90 more days.

However, on December 9th, 2020, Letitia James, the Attorney General, filed a document, asking Justice Cohen to extend the deadline to January 15th, 2021. James said that “the parties continue to cooperate on the production of documents in response to the 354 Order, and anticipate that the production could be finalized in the coming weeks.”

Why the January 15th Deadline is Important?

With this, we arrive at the time of this writing and the importance of the January 15th deadline. There are a few reasons for which this is a critical point in this case. First, it requires that iFinex produces the necessary information for the NYAG to continue its investigation and to further substantiate the merits of its claims.

And perhaps what’s even more important, however, is the nature of the documentation. In essence, iFinex has to produce materials on the process by which they determine whether, when, and how to issue and redeem tethers, banks, documents, and communications regarding specific issuances and redemptions, as well as trading activity on the Bitfinex trading platform regarding tethers and bitcoin.

This is a landmark case for the entire cryptocurrency space as USDT is the most popular and biggest stablecoin on the market. The company issuing it has been involved in many scandals in the past, with many questioning the fact that it’s actually backed by USD.

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Source: https://cryptopotato.com/tether-usdt-january-15th-deadline-on-ifinex-case-everything-you-need-to-know/

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