Cryptocurrency
Binance US and SEC Reach Mutual Agreement on User Funds
Binance U.S. and the Securities and Exchange Commission (SEC) have reached an agreement to repatriate customer funds to the United States.
The deal means Binance has avoided having its assets frozen and will be able to continue serving its U.S. customers.
SEC Requires Binance to Repatriate U.S. Customer Funds
The last-minute deal came after Judge Amy Berman Jackson ordered the two parties to work together.
Originally, the SEC had sought a court order to freeze funds, arguing that it was necessary to:
“prevent dissipation or transfer of those assets from the jurisdiction of this Court, and protect this Court’s ability to award relief in the form of disgorgement, prejudgment interest, and civil penalties.”
However, Judge Jackson acknowledged that such a freeze would hamstring Binance’s U.S. business and pass the SEC a major victory just days into its lawsuit against the firm. In order to avoid such an outcome, she asked both sides to reach a compromise.
On Saturday, the Commission announced that it had secured an agreement to repatriate Binance U.S. customers’ assets to the United States. The company and its associated entities are also prohibited from spending corporate assets “other than in the ordinary course of business.”
Binance’s CEO Changpeng Zhao is also named as a party to the agreement, which takes the form of a consent order.
Both Sides Claim Compromise as Victory
The SEC has painted the latest deal as a win that will prevent Binance from running off with customer funds. However, Binance has also claimed the incident as a victory, noting that the SEC has failed in its attempts to shut down the U.S. exchange.
In a statement on Saturday, Binance U.S. emphasized that the SEC has presented no evidence to suggest it has ever misused customer assets.
Rather, the firm construes the SEC’s legal maneuvers as an attempt to hurt its business by any means possible. As it stated:
“The SEC’s request would have effectively shuttered our business, which is consistent with the agency’s continued attempts to kill the crypto industry by any means, even by making allegations that are not supported by the facts.”
Loss of Banking Capacity Hits Binance’s U.S. Business
Binance may have narrowly avoided having its assets completely frozen. But it is still struggling under the pressure of the SEC’s lawsuit.
One major factor inhibiting the company’s performance in the U.S. is the loss of its banking partners.
This week, Several banks temporarily suspended Binance-administered accounts pending Judge Jackson’s decision. And the firm was left struggling to serve USD customers. It said that as a result restrictions, it was unable to process up to 15% of USD withdrawal requests.
The platform said dollar-flows have been “throttled” by its banking partners. And amid fear that Binance could be subject to a court-ordered asset freeze, the exchange has been hemorrhaging users. From around 20% in April, Binance U.S.’ market share has plummeted to just 1% this week.
But will Binance recover its full USD banking capacity now that the SEC’s request has been dismissed? That remains to be seen.
Cryptocurrency
Layer-1 Assets Rally as Market Anticipates Trump’s Pro-Crypto Administration: CryptoQuant
The promise of a pro-crypto regulatory environment led by the incoming administration of the United States President Donald Trump has triggered a positive effect among cryptocurrencies, with the native assets of layer-1 blockchains raking in substantial gains.
According to a CryptoQuant report, crypto assets like XRP, TRX, Toncoin (TON), SOL, ADA, the native assets of Ripple, Tron Network, The Open Network, Solana, and Cardano, respectively, have witnessed significant rallies since the conclusion of the U.S. presidential elections.
Layer-1 Coins on the Rise
Ripple’s native cryptocurrency, XRP, has surged over 120% to $1.40 since the elections, crushing the $1 mark for the first time in three years. Data from CoinMarketCap shows the asset is up more than 166% monthly and 25% daily, a growth partly fueled by a resignation update from the U.S. Securities and Exchange Commission (SEC) chairman Gary Gensler.
The SEC and Ripple have been involved in a legal battle for years, and Gensler’s departure could ease the digital asset infrastructure developer’s concerns.
The rise in the value of XRP coincides with decentralized exchange (DEX) activity on the network hitting a new all-time high and total active addresses spiking to the highest daily level since early 2024. CryptoQuant found that DEX volume on the XRP Ledger (XRPL) reached $3.5 million on November 15, with participation from 80 traders. Ripple launched this new automated market maker DEX in May to support the chain’s limit order book DEX.
Tron Network’s native token, TRX, also hit a multi-year high of $0.20 and is up almost 10% weekly. Tron has witnessed a steady growth in transaction activity, driven by the use of Tether (USDT). This year, the network’s daily transaction count rose to a new high of 10 million, while the total supply of USDT hit a record high of over $60 billion.
Daily Spot Volume Surges
In addition, Toncoin’s value increased by 39% amid the high level of activity and stablecoin liquidity on The Open Network. Daily active addresses on the network now hover around one million, up significantly from 60,000 at the start of the year. CryptoQuant also attributed this growth to the integration of USDT on TON in April. The stablecoin has become one of the most active assets on the network, with a circulating supply above $1 billion.
SOL has rallied to an all-time high of $263, while ADA is up 160% to levels last seen in March 2024.
CryptoQuant added that the surge in altcoin prices came with a spike in daily spot trading volume. On November 11, the metric reached one of the highest levels recorded this year.
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Cryptocurrency
Why Peter Schiff Is Wrong About Bitcoin and Inflation (Opinion)
The world’s leading cryptographic currency is trading over 40% higher than its average price on the eve of the November 5th US elections.
Analysts agree that this is owing in large part to the promises of the Trump campaign and its allies to ensure that the federal government is fair to the innovative new Internet industry. But it’s also a repeat of a historic pattern in Bitcoin’s 4-year market supply cycle.
Ark Invest’s Cathie Wood recently doubled down on her 2030 price target for Bitcoin. Last week, she told CNBC’s audience that if history continues to repeat itself, BTC will trade at $1 million by 2030.
The blockchain money industry says that’s good news for the economy as well as the secure layer of the Internet they’re building for financial transactions. But not everyone agrees.
Peter Schiff Casts Shade on Web3 Macro Economics
The more resources Americans misallocate to #Bitcoin and #crypto-related businesses, the fewer resources will be available to devote to making stuff we actually need. The end result will be larger trade deficits, a weaker dollar, higher inflation, and a lower standard of living.
— Peter Schiff (@PeterSchiff) November 20, 2024
Peter Schiff, founder and chief strategist of the Euro Pacific macro hedge fund, said in a post on X Wednesday that money spent on Bitcoin is a “misallocation” that will lead to inefficiencies in the economy. Schiff added that larger trade deficits, a weaker dollar, and lower GDP are the health of the Bitcoin regime.
In another post Wednesday, Schiff remarked that Bitcoin will ironically become a source of inflation, even as buyers use the cryptocurrency as a shelter from dollar inflation.
It’s ironic that many people bought #Bitcoin to hedge against inflation and a weakening dollar. Now, if the U.S. government actually buys Bitcoin, and diverts even more of our scarce resources to crypto, Bitcoin itself will become the source of more inflation and dollar weakness.
— Peter Schiff (@PeterSchiff) November 19, 2024
How Bitcoin Helps the Fed Do its Job
Schiff may be getting tangled up in the terminology of inflation. It’s a forgivable error. Bitcoin’s role in the ecosystem is so novel it’s still difficult to comprehend, even for a capable economist like the founder of the Euro Pac.
Rising business and consumer costs from low-rate dollar environments are the inflation that cryptocurrency users use Bitcoin to protect and grow their wealth. Rising BTC prices represent the dollar’s inflation and Bitcoin’s relative deflation.
(BTC is inflationary, but far less so than the dollar when the Federal Reserve cuts rates.)
So, will more investment in Bitcoin actually goose the trade deficit with China and US dollar inflation while slowing new supplies of goods and services that people use money to buy?
Every dollar sent to Bitcoin instead of overseas to China for imports actually helps balance the trade deficit. Meanwhile, it’s not Bitcoin that causes dollar inflation; the Federal Reserve increases the dollar supply to target lower borrowing costs.
Since resolving the financial crisis of 2008, the Fed has actually been terrified that the money supply isn’t keeping up with GDP. The danger of the resulting deflation is a potential debt devaluation spiral that could mire the economy into an intractable depression.
Bitcoin actually supports the central bank in this regard by locking up excess savings in a digital economy that incentivizes participants to “hodl,” not to spend their surplus earnings.
If they were spending all that crypto market cap worth of surplus value, it could drive up prices, ceterus paribus, and make life harder for fixed-income households to manage.
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Cryptocurrency
$500M in Liquidations as Bitcoin Dumps Below $96K, Ripple Down 10% Daily
After several days of charting new peaks and coming less than $200 away from $100,000, bitcoin’s price has taken a breather and has dropped by over four grand since Friday’s high.
Several of the high-flying altcoins on Saturday have reversed their trajectory as well, with XRP, DOGE, and ADA dumping hard from the larger caps.
CryptoPotato reported yesterday BTC’s impressive surge that resulted in the asset exceeding $99,800 on most exchanges to chart its latest all-time high. While the community was preparing for a run toward and beyond $100,000, though, the cryptocurrency lost its momentum and started to retrace.
At first, it dropped to $98,000 on Sunday, as reported earlier, but the bears kept the pressure on and bitcoin fell even further to under $96,000. Its market cap has slipped below $1.9 trillion after losing over $60 billion since Friday.
Many altcoins have dumped even harder in the past day, though. XRP is the leader after dropping by 11% from its local peak of over $1.6 to $1.34. ADA follows suit with a 9% decline that has taken it to under $1.
Some losses are evident from the ever-volatile meme coin sector, with BRETT down by 10%, followed by BONK (-9%), FLOKI (-8%), and WIF (-7.5%).
Dogecoin is also in the red, dropping from nearly $0.5 on Saturday morning to $0.41 now.
This substantial volatility has harmed over-levaraged traders, with nearly 200,000 such market participants wrecked in the past 24 hours. The total value of liquidated positions is up to almost $500 million. Naturally, the lion’s share belong to longs, with $383 million.
The largest single one took place on Binance and was worth over $13 million.
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