Crypto execs meet with Biden administration over regulatory crackdown concerns: CNBC Crypto World
Summary
TLDRMicroStrategy's stock surges 22% after a 10-for-1 stock split announcement, making it more accessible to investors. Crypto exchange BitMEX pleads guilty to violating the Bank Secrecy Act, facing up to 5 years in prison and a fine. Former President Trump will speak at the Bitcoin 2024 conference, signaling growing crypto support. Crypto executives meet with the Biden Administration to address regulatory concerns, with bipartisan interest in the industry's future.
Takeaways
- 📈 Micro Strategy's stock price jumped over 22% after announcing a 10-for-1 stock split, aiming to make the stock more accessible to investors and employees.
- 🗣️ Former President Trump is set to speak at the Bitcoin 2024 conference in Nashville, reflecting his rising support for the digital asset industry.
- 🤝 A meeting between crypto executives and Biden Administration officials took place, discussing industry concerns regarding the administration's regulatory approach.
- 💼 Crypto Exchange BitMEX pleaded guilty to violating the Bank Secrecy Act, admitting to not establishing an adequate anti-money laundering program.
- 💡 The importance of bipartisan support for crypto legislation was highlighted, with the potential for crypto to be a significant issue in the upcoming elections.
- 📊 A recent poll indicated that cryptocurrency is an important issue for a significant portion of swing state voters, possibly influencing election outcomes.
- 🚫 FTX lawyers objected to a claim that would make the state liable for nearly $264 million, arguing that a loan agreement was never commenced due to non-delivery of tokens.
- 🌐 The discussion emphasized the global nature of crypto technology and the need for the U.S. to act to maintain its leadership in the space.
- 🛑 The SEC's aggressive stance towards the crypto industry was criticized, with calls for clearer regulatory frameworks to support innovation.
- 🏛️ Legislative discussions are ongoing, particularly around market structure and stablecoins, with the aim to provide clarity and support for the crypto industry.
- 🔍 The crypto industry is seeking regulatory clarity and a nonpartisan approach to legislation to foster growth and innovation.
Q & A
Why did MicroStrategy's shares jump after the announcement of a stock split?
-MicroStrategy's shares jumped more than 22% after the company, which is the largest corporate holder of Bitcoin, announced a 10 for one stock split. The move was intended to make the stock more accessible to investors and employees.
What is the significance of the Bitcoin 2024 conference in Nashville?
-The Bitcoin 2024 conference is significant as it is scheduled to take place from July 25th through the 27th, with former President Trump scheduled to speak on the last day, indicating his support for the digital asset industry.
What was the outcome of the meeting between crypto executives and Biden Administration officials?
-The meeting was described as productive, with discussions aimed at addressing the crypto industry's concerns regarding the administration's regulatory crackdown. It was an important step towards increasing dialogue between the agencies and the industry.
What was BitMEX charged with by the US attorney's office?
-BitMEX pleaded guilty to one count of violating the Bank Secrecy Act by willfully failing to establish and maintain an adequate anti-money laundering program, which led to it being used as a vehicle for large-scale money laundering and sanctions evasion.
What is the current status of the FTX bankruptcy and the claim against it?
-FTX bankruptcy lawyers are pushing back against a claim that would make the state liable for nearly $264 million. They argue that a loan agreement involving serum tokens, which were never received, never commenced, and therefore the claim is baseless.
How has the crypto industry been perceived by the Biden Administration prior to the recent meeting?
-The crypto industry has felt that it has not been treated fairly by the Biden Administration, with a lack of regulatory clarity and the perception of regulation by enforcement by the SEC being major concerns.
What is the role of the Blockchain Association and the Crypto Council for Innovation in the recent meeting with the Biden Administration?
-The CEOs of both the Blockchain Association and the Crypto Council for Innovation, Kristen Smith and Sheila Warren respectively, attended the meeting to voice the industry's concerns and to discuss the need for a regulatory framework that supports innovation and clarity.
What are the potential implications of the SEC's aggressive stance on the crypto industry?
-The SEC's aggressive stance, led by Chair Gary Gensler, has resulted in what the industry perceives as 'regulation by enforcement,' causing uncertainty and making it difficult for industry builders to know how to proceed.
What legislative actions are being discussed in Congress related to the crypto industry?
-Legislative discussions are focusing on market structure and regulatory frameworks for the crypto industry, with the FITT Act (Financial Innovation, Transparency, and Technology Act) being a key piece of legislation passed by the House and currently under consideration in the Senate.
How does the crypto industry view the importance of bipartisan support in Congress?
-The industry views bipartisan support as crucial for the advancement of crypto-related legislation, as it helps to ensure that the technology is not politicized and can develop in a manner that benefits all stakeholders.
What are the next steps for the crypto industry in terms of regulatory clarity and legislative progress?
-The industry is looking to the Senate to take action on market structure legislation and to address the regulatory framework for stablecoins. It is also hoping to resolve jurisdictional authority issues to provide clearer guidance for builders and innovators in the space.
Outlines
📈 MicroStrategy's Bitcoin Holdings and Stock Split
MicroStrategy's shares experienced a significant jump of over 22% following the announcement of a 10-for-1 stock split, aimed at making the stock more accessible to a broader range of investors and employees. This move by the self-proclaimed largest corporate holder of Bitcoin comes amid a period of stability in Bitcoin's price, with many expecting an uptick in the second half of the year. The stock split will result in two classes of common stock, Class A and Class B, further democratizing investment opportunities in the company.
🗣️ Crypto Industry Dialogue with the Biden Administration
A roundtable discussion led by Democratic Congressman Ro Khanna brought together approximately 25 to 30 representatives from the crypto industry and members of the Biden Administration. The meeting, which included the presence of Senator Kyrsten Sinema, aimed to address the crypto industry's concerns regarding the administration's regulatory approach. Kristen Smith, CEO of the Blockchain Association, highlighted the importance of treating the crypto industry fairly and fostering increased dialogue between the industry and government agencies. The conversation also touched on the bipartisan nature of crypto technology and the momentum it has gained in Washington in recent weeks.
🏛️ Regulatory Challenges and Crypto's Future in Washington
Sheila Warren, CEO of the Crypto Council for Innovation, discussed the challenges facing the crypto industry in Washington, particularly the lack of regulatory clarity and the aggressive stance taken by the SEC under Gary Gensler's leadership. The industry is seeking a clear framework for jurisdictional authority over crypto assets, which has been hampered by the absence of congressional action. Despite the challenges, there is a growing interest from lawmakers outside the core committees, indicating a shift towards a more constructive approach to crypto regulation. The conversation also highlighted the importance of approaching crypto regulation in a nonpartisan manner, emphasizing its potential to shape the future of technology and financial services.
Mindmap
Keywords
💡Micro Strategy
💡Stock Split
💡Bitcoin
💡Crypto Exchange
💡Bank Secrecy Act
💡FTX
💡Crypto Donations
💡Regulatory Crackdown
💡Blockchain Association
💡Crypto Council for Innovation
💡Market Structure Legislation
Highlights
Micro Strategy shares jumped over 22% after announcing a 10 for one stock split, aiming to make its stock more accessible to investors and employees.
Inflation dropped slightly in June, which could influence the Federal Reserve's decision to start cutting rates.
Crypto exchange Bitmex pleaded guilty to violating the Bank Secrecy Act by failing to establish an adequate anti-money laundering program.
FTX bankruptcy lawyers disputed a claim that would make the state liable for nearly $264 million, arguing that a loan agreement was never commenced.
Former President Trump is set to speak at the Bitcoin 2024 conference in Nashville, showing his rising support for the digital asset industry.
Crypto Executives met with the Biden Administration to discuss concerns over regulatory crackdowns on the industry.
Kristen Smith, CEO of the Blockchain Association, discussed the importance of treating the crypto industry fairly and the need for increased dialogue.
A recent poll indicates that cryptocurrency is an important issue for 20% of swing state voters in the upcoming election.
Crypto technology is seen as a democratizing force and an alternative to Big Tech and traditional finance.
There is a bipartisan interest in crypto, despite some anti-crypto sentiments from figures like Elizabeth Warren and Gary Gensler.
Market structure and stablecoin legislation are key areas of focus for crypto regulation in Congress.
The crypto industry is looking for regulatory clarity and is concerned about the SEC's aggressive approach to oversight.
Sheila Warren, CEO of the Crypto Council for Innovation, emphasized the need for a nonpartisan approach to crypto regulation.
The roundtable meeting with the Biden Administration was seen as productive, with openness and interest from both sides.
Crypto is increasingly becoming a prominent issue in the political landscape, with potential influence on voter behavior.
The crypto industry is seeking to move forward on legislative progress, especially with limited legislative days left in the year.
There is a push for crypto-friendly policies, especially as other countries are not waiting for the U.S. to act on crypto regulation.
Transcripts
today micro strategy shares jump after
the self-proclaimed Bitcoin holding
company announces a stock split former
president Trump will speak at the
Bitcoin 2024 conference in Nashville
later this month plus Kristen Smith the
CEO of the blockchain association and
Sheila Warren the CEO of the crypto
Council for Innovation discussed what
was addressed at a meeting yesterday
between crypto Executives and Biden
Administration officials
[Music]
welcome to cnbc's crypto world I'm
McKenzie sigalos major cryptocurrencies
are pretty flat after new data out this
morning revealed that inflation dropped
slightly in June compared to the month
before and that helps with the case for
the FED to start cutting rates as of no
Eastern Bitcoin dipped by half a percent
holding study above
$57,000 ether fell slightly trading
above
$3,100 salana however dropped nearly 2%
now taking a look at crypto Focus stocks
micro strategy shares jump more than 22%
as of midday after the company which is
the largest corporate holder of Bitcoin
announced a 10 for one stock split this
morning now shortly after markets opened
the stock Rose more than
99.5% micro strategy said that the
shares will be split into class a common
stock and Class B common stock to make
it stock more accessible to investors
and employees the move comes amid a lull
for the price of Bitcoin which has been
stuck in a tight range for about 4
months but which many investors expect
to Rebound in the second half of this
year okay let's talk about the top
stories crypto exchange bitmex pleaded
guilty to one count of violating the
bank secrecy act the US attorney's
office for the southern district of New
York announced yesterday that bitmex
admitted to violating the act by
willfully failing to establish Implement
and maintain an adequate anti-money
laundering program now in a statement us
attorney Damen Williams said that the
crypto exchanges Founders and a long
time employee first admitted in federal
court in
2022 that the company operated in the US
without any meaningful AML program as
required by law Williams went on to say
that as a result bitmex which was one of
the leading crypto derivatives Platforms
in the world from 2015 until 2020 opened
itself up as a vehicle for large-scale
money laundering and sanctions evasion
schemes posing a serious threat to the
Integrity of a financial system at one
count of viol viting the bank secrecy
act carries a Max sentence of 5 years in
prison and a fine next FTX bankruptcy
lawyers are pushing back against a claim
that would make the state liable for
nearly $264 million now for some context
tyo Shan is a subsidiary of jump trading
and it reportedly invested in serum a
decentralized crypto exchange back in
2020 which became defunct about 2 years
later following the collapse of its
backers FTX and alamer research now in
this objection filed yesterday FTX
lawyers argu that osan's purported
valuation of its claim is quote baseless
the subsidiary of jump trading alleges
that Alam FTX is Sister hedge fund
agreed to lend them 800 million serum
tokens but that the tokens were never
received in the filing FTX lawyers argue
that since Alam failed to deliver the
loan never commenced it goes on to say
that Alam has the right to terminate the
master loan agreement at any time which
would also terminate without damages the
loan at issue which never commenced now
the filing also alleges that Tai mosan
may be liable to the debtors for
fraudulent transfers last up former
president Trump is scheduled to deliver
a speech at the Bitcoin conference in
Nashville later this month now recently
the presumptive Republican nominee has
been pretty vocal about his Rising
support of the digital asset industry in
fact the Trump campaign announced in May
that it would start accepting crypto
donations this week the Republican Party
officially adopted a new policy platform
that would seek to support crypto
Innovation Bitcoin 2024 is scheduled to
take place July 25th through the 27th
with Trump scheduled to speak on the
last day meantime crypto Executives met
with the Biden Administration in
Washington DC yesterday to voice their
concerns tied to the administration's
regulatory Crackdown on the industry
Democratic Congressman Rana hosted the
meeting his staff
confirmed all right sticking with that
meeting for our main story Kristen Smith
the CEO of the BL blockchain Association
was in attendance and I spoke with Smith
about what was discussed and whether the
industry's concerns were addressed by
the Biden
Administration Kristen thank you so much
for being here now you were at a round
table led by Democratic Congressman
rokana it included several industry
players and members of Biden's
Administration as well walk me through
this meeting and what you brought to the
room and can you also weigh in on how
many groups were there yeah no it was a
really productive meeting uh that was
held uh across the street from the White
House yesterday with I think there were
probably about 25 to 30 uh people within
the crypto industry as well as a handful
of folks from the administration uh
Senator gilbran uh was there as well um
but R Conor really deserves credit for
pulling all of this together it was a
really productive conversation I think
you know for a long time the crypto
industry has felt like they haven't been
treated fairly by the Biden
Administration and I think that um you
know this was a really important step
towards increasing the
um uh dialogue between the agencies and
um we're really excited to be a part of
the discussion so we've seen a lot of
momentum toward crypto in Washington in
recent weeks how much of that do you
attribute to voters that hold or believe
in crypto is that a real Force out there
even if it might just be one in five
voters like a recent poll placed it yeah
no it turns out the crypto voter is real
it's it's really remarkable to see it's
stronger than I even would have thought
it would have been yes as you noted
there was a poll from about two months
ago that said in one in five swing state
voters considers cryptocurrency an
important issue in the upcoming election
uh very interestingly there was another
poll that came out yesterday that said
of the Republican voters who were not
planning to vote for Donald Trump 133%
of them are considering doing so because
of his new Pro crypto stance and so this
is an
incredible um powerful force I think you
know if you look at what crypto is it
really represents a better future it
represents an alternative to Big Tech or
to traditional finance and I think
people have this sense around the
country that some institutions have
failed them and they see crypto as an
alternative so it turns out to be a very
very powerful issue and one that is
driving uh voter interest um uh in the
polls and and and probably ultimately in
November now as I mentioned this event
was put on by a democratic congressman
which you know the Democrats have faced
criticism that they aren't as
crypto-friendly as Republicans do you
see that tide turning and is it feeling
more bipartisan in general this topic of
crypto yeah no well cryptotech is
nonpartisan and and so I think the
interestes in crypto um is bipartisan we
do have a couple of people on the
Democratic side mostly Elizabeth Warren
and Gary Gensler who have been very
anti- crypto but we have a lot of
members of the House and Senate on the
Democratic side of the aisle that are
very proc crypto and I think that this I
was saying before the issues and values
of crypto align very well with those
values of the democratic party it's a
very
democratizing uh technology and so you
know I think as we particularly head
into next Congress that we should um you
know we should have uh fairly strong
bipartisan support in the house and the
Senate and the White House regardless of
which party is in charge and we are
seeing more bills moving through
Congress obviously fit 21 there's an
attempt to overturn Biden's veto on Sab
121 do you feel like there's momentum on
your side is crypto's messaging getting
across here yeah well I think the most
promising legislative discussions right
now are happening around Market
structure um this is a market regulatory
framework for the crypto industry uh as
you noted fit 21 was The house's version
of this Market structure legislation and
it was uh passed with overwhelming
bipartisan support earlier this spring
uh the ball is now in the Senate's Court
there's a lot of discussions going on in
a bipartisan fashion to try to figure
out how they can get a vote in the
Senate agriculture committee which would
oversee uh the cftc which might regulate
crypto um as well as potentially even
moving that bill to the floor so there's
certainly a pathway for activity this
year uh it is obviously a very narrow
pathway there's only about 45
legislative days left this year but
we're very um you know engaged and and
hoping that that we make some progress
because even if we don't get all the way
done this year that will be a better
Foundation uh to start from when the new
Congress convenes in January and what
are the progress would you like to see
from Capitol Hill on either side of the
aisle yeah well in addition to Market
structure I think getting something done
on stable coins is important the
president's working group both in this
Biden Administration and the Trump
Administration last time identified this
as an area where there is no appropriate
Federal regulator and so what we need um
is for to step in and pass a regulatory
framework and the house uh looked at
doing legislation on this already um the
Senate uh has also expressed some
interest so those conversations are are
ongoing and that's something else we
would also love to see get across the
Finish Line this year Sheila Warren the
CEO of the crypto Council for Innovation
was also at that meeting with the Biden
Administration and I spoke with her as
well to get her take on how the meeting
went and what was
accomplished Sheila thank you for taking
the time now you were in Round Table led
by Rana which included members of the
Biden Administration and many crypto
focused groups what was the most
important point that you were trying to
get across officials in the
room well I was trying to reinforce
first of all what all of us were saying
which is that this Administration has
not been particularly friendly when it
comes to crypto especially not in recent
years but also to really land the point
this is the global technology other
countries have not waited for the United
States to act and also this is about
more than just Financial Services the
opportunity is much broader it's about
really um architecting in the internet
for everybody so making those points and
connecting them
together and how receptive has
Washington been lately I mean we've
obviously heard a lot about changing
sentiment on Capitol Hill but what have
discussions with lawmakers looked like
for you at the crypto Council for
Innovation well you know we've always
taken the approach this is a bipartisan
issue or nonpartisan truly like any
technology actually is and for us I
would say we have had more interest I
think from folks who aren't on the core
committee so I would say most people who
are on you know the Banking Committee
Financial Services where this is really
in their obvious perview or jurisdiction
have been interested for quite some time
but now we're seeing folks in other
compies of jurisdiction who are also
expressing a lot of interest and I do
think that that's forward progress and
movement that we're happy to
see what are the biggest challenges
facing the industry in Washington
specifically now we've you know had some
progress on crypto legislation though
it's not finalized yet but what's the
work that needs to be done that you're
telling lawmakers about or I mean even
the push back that you might have gotten
in the room uh during this meeting
yesterday well it's it's not just the
lack of regulatory Clarity that the
industry has been talking about for many
years now which really hasn't been
changed or fixed it's what that lack of
clarity and the lack of congressional
action has actually led to namely
regulation by enforcement by the SEC so
you have a very active and aggressive
SEC and a chair and chair Gary Gensler
who seems to have made it a personal
mission to essentially really police
this industry whether or not that is
within his jurisdiction remains an open
question according to the court so here
we are and I think resolving that
resolving that particular dilemma
figuring out with this novel asset class
this novel technology and opportunity
where does the jurisdictional authority
lie which agency or combination of
agencies is the appropriate one to be
having oversight here and I think until
we land that it's very difficult for
Builders to know what to do and how to
move so to go back to that round table
for just one second I think that one of
the points I saw you make was that it's
important to approach crypto in a
nonpartisan manner is that getting
harder when you see Republicans Garner
this perception of being more
crypto-friendly especially with uh their
presumptive nominee Donald Trump set to
speak at Bitcoin
2024 well look I don't think there's any
question that rhetorically the
Republicans are more supportive at this
moment in time than the Democrats at a
party level but you have to remember
that as I noted most people in this
space most Washington lawmakers have not
been paying a lot of attention to this
despite best efforts right because it
just hasn't fallen within the relevant
Committee of jurisdiction they haven't
felt that it's an important enough issue
to frankly take a position on so we find
that most people that we talk to are
still quite open-minded and have been
and are even more openminded now that
this is getting again more attention
more press it's getting more prominences
an issue space that is important so I
don't feel that we've ever been in a
place where this technology is not
nonpartisan or even by partisan it's
just that we haven't had I think the
traction that we're getting in this
election cycle to get folks that haven't
been paying attention to sit up and
realize this is really important I
better have a point of view last
question for you real quick that Round
Table meeting did anything surprise you
in terms of what was said in the
room not in the slightest I mean I have
to say I knew most folks in the room
I've known them for some time uh I was
really pleased tonally with how it went
on both sides I don't think anybody held
back in expressing frustration or some
of the concerns that they have uh about
the approach that some administrative
agencies have taken for example the SEC
but I felt that that was met with a lot
of openness a lot of interest and
eagerness and curiosity to learn more uh
and I felt that it was a very productive
and and constructive conversation
looking forward to next
steps okay that's all for crypto world
today but we'll be back again tomorrow
and we'll see you then
[Music]
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