11th August 2023
A few days after PayPal launched its cryptocurrency stablecoin (PYUSD), we started to see some criticism from lawmakers in Congress of the move from the payment processor.
Where we heard criticism from a member of the Financial Services Committee in the US House of Representatives, who expressed her fears about the inability to protect consumers and ensure financial stability, with the absence of a legal framework at the federal level to monitor and regulate this type of assets, especially with PayPal reaching more than 400 million users around the world.
Earlier this week, PayPal announced the launch of its own cryptocurrency using the Ethereum blockchain (ERC-20). While it was widely welcomed by the digital currency audience, but with some concerns about the possibility of banning and freezing crypto wallets, as stated in the guidelines announced by the company.
Also in the US, this week we saw talk of the US Securities and Exchange Commission (SEC) planning to appeal against a court decision in favor of Ripple Lab that ruled that sales of XRP tokens to retail customers were only in the form of securities, and therefore the company did not issue unregistered investment instruments. While this appeal, if filed, would prolong the years-long legal struggle between the authority and Ripple Lab and may constitute more obstacles to further adoption of cryptocurrency technology.
On the positive side, however, we have seen the cryptocurrency exchange, Gemini, relist XRP tokens on their platform while offering the ability to deposit and trade to their clients.
Also, in the cryptocurrency market, Binance has informed its clients about stop issuing futures contracts for Cardano (ADA) and Polygon (MATIC) coins, without providing further explanations on the reasons. This comes days after Bitstamp delisting of a number of cryptocurrencies, most notably Solana (SOL) and Polygon (MATIC), to comply with SEC publications about not to offer any cryptocurrencies that may be believed to be securities. Also, about two months ago we saw Robinhood delist a number of cryptocurrencies due to regulatory concerns following lawsuits against US arm Binance and Coinbase.
Today, the cryptocurrency markets are awaiting the SEC’s decision to approve or disapprove the launch of the ARK 21Shares Bitcoin ETF, the spot bitcoin ETF applied by Cathy Wood’s Ark Invest. As the deadline for the SEC’s decision is on August 13, while the decision is expected to be issued near the end of the day. On the other hand, lawmakers still have the ability to delay this decision for a period of up to 240 days.
The approval of the launch of this ETF, along with the many funds that have been applied for to be launched from major asset managers in the United States, would provide more recognition, especially from institutional investors and regulators, of the importance of Bitcoin and cryptocurrencies as a trustworthy investment asset.