Regulation
SEC Chair’s SAB 121 Policy Awaits Critical Decision This Week
In a pivotal turn of events, the fate of the Security and Exchange Commission’s Staff Accounting Bill (SAB) 121 hangs in the balance. Currently, the House of Representatives is gearing up for a decisive vote on May 9, 2024. The proposed repeal, led by Representative Mike Flood, is poised to shake the foundation of digital asset regulation.
The House To Decide On Repeal Of Gary Gensler’s SAB 121
Rep. Flood is fervently advocating for the passage of H.J. Res. 109. In a post on X, Flood revealed that the House is going to vote on whether to pass the repeal of SEC Chair Gary Gensler’s SAB 121 policy. Furthermore, he declared, “It’s time to pass H.J. Res. 109! #RepealSAB121,” setting the stage for a contentious showdown within the House of Representatives.
SAB 121, enacted in April 2022, mandates digital asset custodians to report liabilities and corresponding assets for all custodied cryptocurrencies on their balance sheets. The measure, spearheaded by SEC’s Gary Gensler, aims to mitigate the “significant risks and uncertainties associated with safeguarding crypto assets.”
However, dissenting voices have emerged, led by Committee members Mike Flood and Wiley Nickel. They argue that SAB 121’s implementation circumvented proper protocol. Moreover, Rep. Flood underscored the oversight in the issuance process.
He stated, “The SEC issued SAB 121 without conferring with the prudential regulators who are the experts on regulating bank custody.” Echoing these sentiments, Senator Cynthia Lummis emphasized the necessity for adherence to established regulatory procedures, as highlighted in a report by the Government Accountability Office. The report, issued in October 2023, underscored deficiencies in the issuance process, fueling calls for the repeal of SAB 121.
Also Read: Crypto Regulation: CFTC Chair Predicts More Crackdowns In 6-24 Months
House Of Financial Services Passes Resolution
Amidst the fervent debate, proponents of the resolution contend that SAB 121 encourages consumer protection measures. Rep. Maxine Waters, a staunch advocate for regulatory safeguards. He asserted, “Efforts like SAB 121 help prevent fraud.” Citing the collapse of FTX as a cautionary tale, Rep. Waters underscored the imperative of safeguarding investor interests against potential mishandling of crypto assets by custodians.
However, on February 29, the resolution, emerging victorious in a narrow committee vote of 31-20 in the House of Financial Services, garnered support from both sides of the aisle. Notable Democratic proponents include Reps. Wiley Nickel, Ritchie Torres, and Josh Gottheimer, underscoring the bipartisan nature of the contentious issue.
Nevertheless, the battle for the survival of the SEC’s SAB 121 is far from over. The resolution faces the formidable hurdle of securing approval in both the House and the Senate before the policy can be effectively discarded.
Also Read: Digital Chamber Slams SEC’s ‘Regulation by Intimidation’ Strategy
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
New allegations have surfaced surrounding Sam Bankman-Fried (SBF), the founder of the now-collapsed crypto exchange FTX. SBF’s family is now accused of being involved in a $100 million illicit political donation scheme. Moreover, these claims can lead to intense legal trouble for the accused.
Sam Bankman-Fried’s Family Accused Of Illegal Political Donation
Emails disclosed by The Wall Street Journal (WSJ) have brought to light the extensive involvement of SBF’s family in orchestrating these political contributions. Furthermore, an important point to note is that these donations were allegedly funded by misappropriated FTX customer assets.
Prosecutors asserted that Bankman-Fried orchestrated a sprawling influence campaign ahead of the 2022 election, leveraging stolen customer funds to the tune of over $100 million. The newly revealed emails suggest that key family members played pivotal roles in the scheme. These include SBF’s parents, Joe Bankman and Barbara Fried, along with his brother, Gabriel Bankman-Fried. They managed these funds and directed donations to various political causes and candidates.
Moreover, Joe Bankman, a Stanford University law professor, is accused of advising on financial strategies to facilitate these political donations. The WSJ reports that emails show Joe Bankman’s direct involvement in the illicit operations, indicating he was well aware of the illegal straw-donor scheme.
Barbara Fried, who co-founded the political action committee (PAC) Mind the Gap, allegedly used her position to channel funds towards progressive groups and initiatives. Meanwhile, Gabriel Bankman-Fried is accused of directing donations to pandemic prevention efforts. This coordinated effort to disperse funds across the political spectrum aimed to amplify their influence and support favored causes without drawing attention to the origin of the donations.
Also Read: Fmr Obama Solicitor Says Regulators Are “Deliberately Debanking Crypto”
Former FTX Execs Also Involved
David Mason, ex-chairman of the Federal Election Commission (FCE), weighed in on the matter. Mason highlighted that the evidence presented in the emails constituted “strong evidence” of Joe Bankman’s knowledge and participation in the scheme.
The political donation scheme, as detailed by the WSJ, also involved Ryan Salame and Nishad Singh, two former FTX executives. They have already pleaded guilty to participating in the illegal straw-donor scheme. According to prosecutors, Salame directed funds to Republican candidates to dissociate the contributions from Bankman-Fried, while Singh supported liberal candidates.
The allegations have led to several legal proceedings, with the potential for significant legal liabilities for those involved. Moreover, Mason’s remarks underscore the gravity of the situation. It suggests that Joe Bankman could face direct legal consequences under campaign finance laws if the allegations are substantiated.
Despite the mounting evidence, a spokesperson for Joe Bankman has refuted claims of his involvement. They stated that Bankman had “no knowledge of any alleged campaign finance violations.” This defense, however, stands in stark contrast to the detailed emails that have surfaced.
Also Read: Just-In: Mt. Gox Starts Repaying Creditors, Bitcoin To Dip Further?
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
In a notable legal confrontation, OpenAI has requested that the New York Times (NYT) validate the originality of its articles. The AI firm demands the court mandate NYT disclose detailed source materials for each copyrighted article. This move is part of an ongoing lawsuit in which the NYT accuses OpenAI of using its content without permission.
OpenAI Requests Transparency from NYT
OpenAI’s legal team has approached a New York court with a significant demand. They insist that the NYT provide comprehensive details about the creation process of its articles. The request includes access to the reporter’s notes, interview records, and other source materials. OpenAI argues that this information is crucial to determine the originality and authorship of the articles in question.
The court filing by OpenAI aims to explore the depth and authenticity of the NYT’s journalistic process. Their lawyers argue that the NYT’s claim of substantial investment in high-quality journalism prompts a need for transparency. They believe understanding the creation process is essential for the court to make a fair judgment.
OpenAI argues that such disclosure is necessary for its defense. Detailed insight into the NYT’s authorship process will help ascertain whether the articles are original works. The NYT made this request following allegations that OpenAI unauthorizedly used its content to train AI models.
Also Read: German Lawmaker Wants Government To HODL Bitcoin (BTC), Not Sell
NYT Fights Back on Copyright Infringement
Responding swiftly, the NYT’s legal team filed a motion to dismiss OpenAI’s request on July 3. They argue that OpenAI’s demands are excessive and could set a troubling precedent for copyright law. The NYT contends that the intricacies of their journalistic practices are irrelevant to the issue of copyright infringement.
The NYT’s opposition stresses that the request undermines the basic principles of copyright law. They believe that proving the content creation process does not pertain to the alleged misuse. The NYT’s lawyers highlight that the focus should remain whether OpenAI used the copyrighted articles without authorization.
Furthermore, the NYT accuses OpenAI of attempting to divert the court’s attention from the real issue at hand. They maintain that the lawsuit should concentrate on the legality of OpenAI’s use of the NYT’s copyrighted content. The newspaper defends its rights to its intellectual property, arguing that the creation process should remain protected.
Also Read: Core Scientific Founder Claims Bitcoin’s True Value Not Yet Realized
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
A week after Custodia Bank filed an appeal in the 10th Circuit Court challenging the Fed’s power to deny it a master account, former Solicitor General Paul Clement has now filed an amicus brief on behalf of the crypto industry.
Paul Clement Takes Custodia Bank vs Fed Fight Ahead
As said, in the recent Custodia Bank vs. Fed case, Paul Clement filed an Amicus brief on Wednesday, July 3, while supporting the crypto industry. Clement has gained popularity in his recent success in overturning the Chevron Defence in the Supreme Court case in the Supreme Court case involving Loper Bright fishermen.
Also Read: US SEC Takes Major Blow In Chevron Howey Test Case, Implication For Crypto
In this ongoing legal fight, The Digital Chamber (TDC) and the Global Business Blockchain Council-USA (GBBC-USA) have expressed their significant interest and unique perspective. With extensive experience in the digital assets industry, the two organizations have argued that denying state-chartered banks a reliable path to participate in the national banking just because of the involvement with digital assets will threaten the growth and success of the trillion-dollar blockchain industry.
The two organization argue that upholding the lower court’s decision will give politically unaccountable federal officials and unchecked power to stiffle innovation thereby cutting off legitimate businesses from having crucial access to the global financial system.
The District Court stated that the “Federal Reserve Bank of Kansas City (“FRBKC”) has unreviewable discretion to denynonmember depository institutionsa master account”.
TDC and GBBC argued that despite following the legal boundaries, this court decision set dangerous precedence for any industry that might fall out with the Fed officials.
Paul Clement Raises Constitutional Concerns on Fed’s Structure
In the amicus brief, the former Solicitor General has raised some constitutional questions regarding the Fed’s structure. Clement states: “In sum, by affording Federal Reserve Bank presidents significant and largely unconstrained discretionary power, the district court’s decision raises serious constitutional questions under Article II.”
“The district court’s decision threatens the dual system by granting Federal Reserve Bank officials unreviewable discretion to “effectively crippl[e]” state-chartered banks operating legally,” he added.
Also Read: Custodia Bank CEO Predicts “Rip Roaring” Bitcoin Bull Market
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
PancakeSwap Opens Claim For 2.4M ZK Tokens As zkSync Denies Insider Minting
BNB Drops Below $500, Extended Bearish Trend On The Horizon?
FTX Founder Sam Bankman-Fried’s Family Accused Of $100M Illicit Political Donation
Pepe Coin Correction Prompts Over 1 Tln PEPE Dump, Bull Run Over?
Crypto Whales Boost Holdings of These 3 Altcoins
Bitcoin Crash: VanEck Sees an Opportunity
Hong Kong’s Securities Association Tips Authorities On Crypto Self-Regulation
Are Solana, Cardano, Polygon Commodities As US SEC Ends Ethereum Investigation?
CFTC Appoints Dr. Ted Kaouk as First Chief AI Officer
Terraform Labs Refuses to Pay $5.3 Billion Fine, Says SEC Has No Evidence
TON Foundation’s Plan to Onboard 500 Million Users
Avalanche (AVAX) Under Pressure: Prolonged Downtrend Next?
Hong Kong’s Securities Association Tips Authorities On Crypto Self-Regulation
Are Solana, Cardano, Polygon Commodities As US SEC Ends Ethereum Investigation?
CFTC Appoints Dr. Ted Kaouk as First Chief AI Officer
Terraform Labs Refuses to Pay $5.3 Billion Fine, Says SEC Has No Evidence
TON Foundation’s Plan to Onboard 500 Million Users
Avalanche (AVAX) Under Pressure: Prolonged Downtrend Next?
-
Blockchain2 months agoHong Kong’s Securities Association Tips Authorities On Crypto Self-Regulation
-
Altcoin2 weeks ago
Are Solana, Cardano, Polygon Commodities As US SEC Ends Ethereum Investigation?
-
Regulation2 months agoCFTC Appoints Dr. Ted Kaouk as First Chief AI Officer
-
Regulation2 months agoTerraform Labs Refuses to Pay $5.3 Billion Fine, Says SEC Has No Evidence
-
Market2 weeks ago
TON Foundation’s Plan to Onboard 500 Million Users
-
Market3 weeks agoAvalanche (AVAX) Under Pressure: Prolonged Downtrend Next?
-
NFT3 weeks agoNew And Upcoming NFT Projects
-
Altcoin2 weeks ago2.52 Million Altcoins Are Ruining Crypto’s Future
✓ Share: