Edition No. 13
Retailer Adoption; Binance v. Bloomberg; Rostin Benham's Address; Satoshi Nakamoto; UK Law Commission's Proposal; and more. Here's what happened from 7/25/2022 - 8/1/2022.
Welcome to another edition of Around the Blockchain, the weekly letter dedicated to keeping readers like you up to date on the fast-paced world of Crypto & Law by airdropping current stories and projects directly to your browser.
Table of Contents:
1. On the Docket (Top 5 Stories of the Week)
2. Podcasts, Videos, & Blogs (The faces, voices, and pens of Web3’s brightest contributors)
3. Bird Watching (Tweet, tweet!)
4. Motion to Compel (Meant to provoke thought and action)
5. The Public Ledger (Highlights from our weekly library of sources, built by our Feedly AI)
6. Closing Statements
On the Docket
Five things you might have missed last week:
1. Nearly 75% of Retailers Plan to Accept Cryptocurrency Payments Within the Next 2 Years
Prepare for Liftoff? (Possibly)
Nearly 75 percent of retailers plan to accept cryptocurrency or stablecoin payments within the next two years, according to a Deloitte survey titled "Merchants preparing for crypto" conducted in June.
It may not be an easy task, however.
Retailers interested in cryptocurrencies recognize that there are a number of obstacles to overcome in order to accept digital currency payments. The complexity of making their existing financial infrastructure compatible with various digital currencies was cited by nearly 90 percent as their greatest challenge. Despite that fact, CNBC author Cheyenne DeVon notes:
“Retailers remain optimistic about the benefits of enabling payments with cryptocurrencies. Nearly half of retailers believe this move will improve customer experience and increase their customer base.”
2. World's Richest Crypto Billionaire Takes Legal Action Against Bloomberg for Defamation
Consequences of Clickbait:
Binance CEO Changpeng Zhao sued Hong Kong's publisher of Bloomberg Businessweek, Modern Media CL., on Monday, accusing the company of defamation. Zhao, the world's wealthiest crypto billionaire, claimed that the publisher portrayed him as operating a "Ponzi scheme." According to the lawsuit, the article's translated Chinese language version had a misconstrued headline.
A team representing Zhao requested that the headline be retracted and that all printed copies be recalled from newsstands. Zhao also sought a restraining order to prevent the publisher from further disseminating the negative portrayal. Modern Media has partially agreed to his demands. However, Zhao didn't stop there. In the US, he separately filed a motion for discovery against Bloomberg Inc. and Bloomberg L.P. due to "defamatory allegations" in the article.
See also: coindesk.com; blockworks.co
3. CFTC Chairman Rostin Behnam on The Future of Crypto Regulation
A vision for mutually beneficial regulations:
CFTC’s Rostin Benham spoke at the Brookings Institution webcast on July 25th on the current and future state of cryptographic asset regulations in the US. Thee entire draft can be found in the link above, but I found some of his opening remarks most fascinating:
“We are here today because digital assets are trending towards becoming a part of mainstream American portfolios, with surveys and polls demonstrating that as many as one in every five adults has invested in or otherwise used cryptocurrency.[3] This market has developed in the absence of a firmly demarcated regulatory perimeter. A massive influx of retail participants has further galvanized an industry eager to meet demand for products and services. Each digital asset is empowered by the free, largely unfettered flow of information—the defining characteristic of the information age we are currently occupying—and relatively low barriers to access.
The onset of the current “crypto winter,” now blanketing the streets from Main to Wall, is further invigorating the call for a technology-neutral regulatory approach, guided by the risks within the crypto ecosystem, and not by risks within the underlying technology that makes it possible.[4] The prior wintery mix of 2018 is attributed to a crypto mania bubble bursting, accelerated by the chilling effect of hacks, the failure of institutional support, and hard forks. The current storm is brewing from macroeconomic factors, leverage built up by the emergence of new financial products, high risk investing, and contagion.”
Read more in the link above.
4. Self-proclaimed Bitcoin Inventor Wins Legal Battle and Pockets $56 billion
Mystery solved…or is it?
Ira Kleiman v. Craig Wright alleges that Satoshi Nakamoto is an Australian programmer named Craig Steven Wright. The family of Wright's former business partner, David Kleiman, claimed that Wright owed Kleiman's estate half of Wright's 1,100,000 bitcoins, which at the time were worth more than $56 billion. The majority of the jury sided with Wright, granting him complete control of the bitcoin stash.
These coins were the very first bitcoins to be mined, but does this support Wright's claim that he is the creator of the world's most dominant cryptocurrency? Has Nakamoto's enduring mystery been resolved? And with more than $50 billion in his bank account, does it matter to Wright or the cryptocurrency community as a whole?
Read more in the article by Irish Tech News above.
5. UK Law Commission Proposes New Category of Personal Property
A rose by any name…
Britain's Law Commission has proposed a new category of personal property for ‘data objects’ which would include NFTs and cryptocurrencies, arguing that existing property laws cant sufficiently accommodate digital assets. According to Professor Sarah Green, the Law Commissioner for Commercial and Common Law:
“Our proposals aim to create a strong legal framework that offers greater consistency and protection for users and promotes an environment that is able to encourage further technological innovation.”
Property law in England and Wales currently recognizes two types of personal property: Things in possession, which include tangible objects, and Things in action for property like company shares that can “only be claimed or enforced through legal action.” Formulating an additional category for digital assets recognizes their ‘unique qualities’. Read the paper in full and keep track of its progress here.
See also: lawcom.gov.uk, fnlondon.com, yahoo.com, coindesk.com
Podcasts, Videos, and Blogs
The brightest voices & sharpest pens:
Bankless Podcast speaks with Hasu on how to fix DeFi tokens:
In this episode, Balaji Srinivasan discusses his most recent book, "The Network State," how various digital tools, such as cryptography, will empower network states, and how cryptography fits into the current political climate.
DOIcast dives into Underdog Protocol:
CryptoLaw #59, from Ann Sofie Cloots, explores the Nigerian Crypto Market, SEC v. Wahi, Japlan’s Web3 plans, and problems at SushiSwap:
Bird Watching
Tweet, Tweet, Tweet!
@JoshuaLDurham breaks down SEC v. Wahi:
@banklessDAO reviews the month in decentralized law:
@gonbegood summarizes a new potential definition of digital assets:
Punny
Motion To Compel
The Alleged Crypto Asset Securities
The SEC claims these 9 digital assets are securities - here’s why:
By Nick Corso
On July 21, 2022, the Securities and Exchange Commission (SEC) filed a complaint against a Coinbase employee, his brother and friend for insider trading of crypto asset securities. In doing so, the SEC has accused nine digital asset issuers of violating securities laws, yet none of these issuers are listed as defendants’ in the complaint.
Read the full analysis of the 9 assets mentioned in the complaint HERE:
Nick is a fellow Blockchain Barrister Law Student, and is a 2L at the University of Miami School of Law. Coming from an engineering background, Nick is interested in intellectual property law and crypto law. Twitter: @nick_corso2.
The Public Ledger
Highlights from the hundreds of sources gathered each week by our research AI. Always DYOR - but in case you don’t have time, here’s some of ours:
General News and Opinion
KuCoin Launches NFT EFT, Becoming First Large Crypto Exchange to Support NFT Investments
Former Voyager Executive Wants Different Restructuring Plan for Embattled Firm
‘Marriage’ And ‘Litigation’ Possibility In Metaverse Universe
Why the latest ‘crypto winter’ means extra work come tax season
Law Enforcement Crack Down Drives Cyber Criminals Towards Less-Conspicuous Attacks
Nearly 75% of retailers plan to accept cryptocurrency payments within the next 2 years
Financial Stability Board Letter Highlights Crypto-Asset Issues
Prolific Crypto Market Demands Regulation, Investor Education, Experts Say
U.S. - Federal
Senate Virtual Currency Tax Fairness companion bill drops purchase exclusion to $50
Bipartisan Stablecoin Bill to Be Delayed Until September 2022
US Consumer Regulator Sets Sights on Crypto as Big Tech Moves Into Finance
US Treasury Sanctions Kraken for Allowing Crypto Trading in Prohibited Countries
All my apes gone: Legal disputes at the intersection of IP and NFTs
House committee scuttles plans to take up stablecoin bill this week
SEC alters strategy as Defendant secures major win on Amici status fight
SEC v. Ripple Battle Ensues: General Counsel for XRP Says Regulator is “Bullying” the Crypto Market
U.S. - State Law
Crypto Compensation? Bitcoin Bonus? New York State Employers Must Weigh Requests Carefully
NY Bank Regulator's Top Rule For Crypto Cos.: No Surprises **
Nine Bitcoin mining machines stolen in 'useless crime,' Van Buren County detectives say
US State Regulator Warns About Crypto Interest-Bearing Accounts Amid Market Downturn
International
Crypto platform Zipmex files for bankruptcy protection in Singapore
Do Kwon, Terraform Labs Face Class-Action Lawsuit for Allegedly Selling Unregistered Securities
Dubai permits full operation to FTX subsidiary FZE via first MVP license
Crypto law proposals could help boost UK while regulators lag behind, experts say
Greek Police Scramble to Catch Onecoin's 'Cryptoqueen' Ruja Ignatova, Local Media Reports
Honduras launches 'Bitcoin Valley' in the tourist town of Santa Lucia
Law Commission of England and Wales Sees Crypto as a New Type of Property
Closing Statements
We want to hear from you:
If you enjoyed what you read today, subscribe to receive the weekly publication and give the authors a follow on Twitter for updates on what’s next for the newsletter!
If you didn’t enjoy it, let us know why! We value the opinion of our readers above all else. After all, this letter is for you. - Kyler & Chris
Quote of the Week:
“I do believe that 98% to 99% of NFT projects will fail as investments but that's similar to me as internet stocks in '99 and 2000. But Amazon.com was there. The internet changed our lives and the blockchain and NFTs will do that as well.” - Gary Vee
Ok, all done! You can go ahead and check your P/L now (Coin Market Cap)
This newsletter is curated, annotated, and edited by Christopher Foreman (Twitter - @CryptlessInSEA) and Kyler Wandler (Twitter - @KylerW56); with consultation and input from Jacob Robinson of the Law of Code Podcast; editing courtesy of TΞxas ₿l◎ckchain LawyΞr ; in collaboration with Ann Sofie Cloots; and support from the Blockchain Barristers Law Student Collective and the Stetson Blockchain & Law Society.
The articles and opinions in this newsletter are not legal or financial advice. For legal and financial guidance, please consult a qualified attorney or financial advisor.
Special thanks / image credits:
Law / Scale Image; Twitter Image; Blockchain Image; Podcast Image; P / L Image; Tea GIF; Stable JPEG; Law JPEG; Hacker GIF; Folder GIF; Angry GIF; Celsius GIF; Rose PNG; Rocket GIF; No GIF; Speech GIF; Mask Png;
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