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US Regulators Warn on Potential Risks in Bitcoin Futures Trading

The investor bulletin highlighted the “lack of regulation” in the Bitcoin market.

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The US Securities and Exchange Commission’s (SEC) Office of Investor Education and Advocacy (OIEA) and the Commodity Futures Trading Commission’s (CFTC) Office of Customer Education and Outreach (OCEO) issued a warning on Thursday targeting investors who are looking for funds with exposure to Bitcoin futures. According to the investor bulletin, people should exercise caution and be careful about the investment’s potential risks and benefits.

“Among other things, investors should understand that Bitcoin, including gaining exposure through the Bitcoin futures market, is a highly speculative investment,” the regulatory bureaus commented. Furthermore, they raised concerns once again on the volatility that Bitcoin brings to the crypto sphere and that it’s being witnessed on the Bitcoin futures markets.

In fact, they cited the lack of regulation and “potential for fraud or manipulation” of the market. The bulletin provides guidance on which elements the investors should pay attention to, such as the risk tolerance, the fund’s disclosure of its risks, potential loss of the investment, and the difference in investment outcome.

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“A rise in Bitcoin prices may not result in a similar increase in the value of a fund holding positions in Bitcoin futures contracts. This is in part because funds that trade commodity futures contracts may not have direct exposure to the contracts’ underlying assets. Futures contract prices can vary by delivery months and differ from the underlying commodity’s spot price,” the regulators said.

Investment Company Act of 1940

Also, in the bulletin, the bureaus who signed the warning highlighted that funds regulated under the Investment Company Act of 1940 are required to provide critical investor protections, such as: “funds must comply with legal requirements related to valuation and custody of fund assets, and mutual funds and ETFs must comply with liquidity requirements.”

Recently, the US SEC opened the doors to establishing cooperation with the lawmakers from Congress and other regulatory bodies to work on ways to protect crypto investors.

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Source: https://www.financemagnates.com/cryptocurrency/regulation/us-regulators-warn-on-potential-risks-in-bitcoin-futures-trading/

Blockchain

Tanzania’s Central Bank Working on Adopting Cryptocurrencies

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A few years after banning the usage of digital assets within its borders, Tanzania is heading towards a full 180-turn. The nation’s central bank asserted today that it has begun working on a recent directive from the President to adopt cryptocurrencies.

  • CryptoPotato reported a few weeks back when Tanzania’s President – Samia Suluhu Hassan – highlighted the need for the country to adopt digital assets.
  • A Reuters reported from June 25th showed that Tanzania’s central bank plans to listen to Hassan’s words. The organization wants to be prepared for if or when the nation will need to use cryptocurrencies.
  • Interestingly, today’s statement from the bank shows an entirely different approach than the one undertaken in 2019.
  • Back then, the institution implemented a ban on operating with cryptocurrencies. It argued that the country had not recognized them as legal currencies and warned its citizens to stay away as they might lose money if they invested in such speculative assets.
  • Now, though, a spokesperson from the central bank reassured that the organization is “working on the directives given,” referring to President Hassan’s comments.
  • However, the bank’s representative failed to disclose details whether it will adopt Bitcoin and other currently existing digital assets or will tend to go with the Chinese route and create a CBDC.
  • This development comes shortly after news broke that El Salvador has become the world’s first nation to make Bitcoin a legal tender.
  • As reported in early June, the government of the small Central American nation voted in favor of the law, which will come into effect in September.
  • Since then, several other countries have outlined similar plans, including Paraguay and Panama.
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Source: https://cryptopotato.com/tanzanias-central-bank-working-on-adopting-cryptocurrencies/

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XRP lawsuit: Why SEC’s latest motion, Hinman’s deposition ‘should scare everyone’

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Until a week back, it was quite apparent that only the plaintiffs in the ongoing SEC v. Ripple lawsuit desperately wanted to depose additional people. However, it recently came to light that the defendants too intended to depose an additional office-bearer. With the sole hint of ‘former SEC official,’ the community started making its own guesses as to who would it be. Among the host of options available, two names stood out and seemed to be the most appealing – Jay Clayton and William Hinman.

In what is the latest development in the same, the SEC has now filed a motion to quash the deposition of its official. Unsurprisingly, the ‘former SEC official’ named by Ripple is SEC’s former Director in-charge of the Corporate Finance division, William Hinman. According to the plaintiff’s motion,

“To depose a former high-ranking government official like Director Hinman, Defendants bear the burden of showing ‘exceptional circumstances’ justifying the deposition.”

It should be noted that the purpose of the “exceptional circumstances” rule is to “protect the mental process” of government officials. As far as the defendants are concerned, they have claimed that they need to depose the official to elicit testimony on the SEC’s “internal views” and to develop evidence with respect to the “market participants’ views” based on Hinman’s interactions with members of the public. The SEC, on the contrary, argued,

“… these proposed inquiries… could be obtained by far less intrusive means.”

The SEC further stated that the answers the blockchain company seeks are protected by privilege since they relate to the everyday tasks of most high-ranking government officials. 

“Director Hinman has no personal, first-hand knowledge as to defendants’ offers and sales of XRP.”

Here, it should be noted that the official was a part of the SEC’s fact-gathering team that investigated Ripple’s conduct between 2018 and 2020. Additionally, he and his staff have also reviewed written submissions from the defendants’ council.

Further, the federal agency noted in its motion that XRP holders had shared false information about Hinman. Attorney John E. Deaton was quick to react, however, opining, 

“What’s false?… Maybe allowing the deposition to go forward will make future high ranking officials more accountable regarding the things that they say.”

Again, as known, Hinman made a public speech in 2018 where he explicitly stated that offers and sales of Ether were “not securities transactions.” However, at that time, he did not claim anything about XRP or Ripple. 

Further, in the exhibits attached with the motion, Hinman declared that the SEC has still not taken a call on whether the offer and sales of Ether fall under the category of securities. This menacing declaration, according to attorney James K. Filan, “should scare everyone.”


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Source: https://ambcrypto.com/xrp-lawsuit-why-secs-latest-motion-hinmans-deposition-should-scare-everyone

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Binance Coin, Tron, UNI Price Analysis: 25 June

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Major cryptos gained back some ground after facing some major losses on Tuesday. After dropping below $30,000 for the first time since January, Bitcoin was back to $34,213 at the time of writing, hiking by 3.1% over the past 24 hours. Major altcoins like Binance Coin, Tron, and UNI also profited off the back of this price gain for a while. Later, market volatility could be seen slowing down as the cryptos began to move sideways. 

However, Binance Coin and Tron noted positive bullish momentum, even as UNI’s southbound movement met a halt. 

Binance Coin [BNB]

Source: BNB/USD, TradingView

Ranked 4th on CoinMarketCap, Binance Coin was trading at $302 at the time of writing, with the alt hiking by 5% in the aforementioned period. In fact, it had gained by almost 38% since 22 June, the day when it hit a low of $224. After momentarily breaking through the $307-resistance yesterday on the 4-hour chart, the asset was again trading below it at press time. 

The parallel movement of the Bollinger Bands suggested that high market volatility had come to a halt and stable price action could be expected in the near term. 

Bullish momentum was cropping up on the Awesome Oscillator as the green bars moved above the histogram. The MACD and Signal lines pictured a bullish crossover on 23 June as the alt’s price recovered over the past few days. 

BNB could go up to $326 before finding further resistance if the bullish trend continues.

Tron [TRX] 

Source: TRX/USD, TradingView

After touching a low of $0.046 on 22 June, Tron rallied up by 46% to trade at $0.066 at the time of writing. The crypto broke through the $0.065 resistance yesterday, which then began to act as a strong support level. 

The Parabolic SAR’s dotted line hovered below the candlesticks as the coin’s price action continued to follow a bullish trend. Moreover, long green lines above the Awesome Oscillator’s histogram pictured dominant bullish momentum on the digital currency’s price chart. 

A reversal from intense selling pressure could be noticed as the Relative Strength Index’s indicator exited the oversold region and held its position just below the overbought zone. While a minor downtick can be noticed, buying pressure continued to be greater than the selling pressure. 

Even if the bullish price action holds out, the coin could face resistance at the $0.069-mark. 

Uniswap [UNI]

Source: UNI/USD, TradingView

UNI has not been as lucky as the other alts as it was struggling to breach the $18.6 resistance, even as it found new support at $16.5. The asset did register a 2.18% price hike over the past 24 hours, however, and was trading in the red at $17.36, at the time of writing. The total value locked in the 7th highest-ranked DeFi token was $4.27 billion, according to DeFi Llama. 

The coin’s market started turning less volatile, as indicated by the contraction of the Bollinger Bands. Restricted price action for the coin can be expected going forward. 

While the buyers overtook the sellers for a brief period, the Chaikin Money Flow was again moving in a downward direction. It was at equilibrium, at press time, as capital outflows started to dominate the market. 

A reversal of the bullish crossover from the MACD lines can be expected in the future, as suggested by the indicator’s histogram and convergence of the indicator lines. 


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Source: https://ambcrypto.com/binance-coin-tron-uni-price-analysis-25-june

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