Tag: SEC

SEC approves bitcoin ETFs for some investment firms

New York

After a false start Tuesday, the Securities and Exchange Commission gave its approval Wednesday for some investment companies to offer “spot bitcoin” exchange-traded funds.

The regulator’s highly anticipated move is expected to make bitcoin investing more accessible to Main Street investors, without requiring them to own the digital asset directly.

SEC Chair Gary Gensler made it clear in a statement on the SEC’s website that the agency remains wary. “While we approved the listing and trading of certain spot bitcoin ETP shares today, we did not approve or endorse bitcoin. Investors should remain cautious about the myriad risks associated with bitcoin and products whose value is tied to crypto,” he wrote.

The SEC had a deadline of January 10 to offer a decision for just one of the 11 firms that applied to offer bitcoin ETFs. On Wednesday it offered approval to all 11 of them.

Bitcoin, the leading cryptocurrency, has a current market cap of roughly $900 billion. It has seen volatile price swings throughout its 15-year history. Most recently, after hitting an all-time high of nearly $69,000 in November 2021, it fell below $17,000 during the “crypto winter” of 2022 and has mostly been trading north of $45,000 in the run-up to the SEC’s decision.

About an hour after the news Wednesday, the price of bitcoin was up 0.3%% to nearly $46,000, according to data on coinmarketcap.com.

After the stock market close on Tuesday, a post on the SEC’s X account falsely claimed the regulatory agency had approved the listing and trading of spot bitcoin exchange-traded products.

That was quickly debunked by Gensler, and the SEC took down the message. According to X, an “unidentified individual obtaining control over a phone number associated with the @SECGov account through a third party” was responsible for

SEC Alleges Texas Cattle Investment is $191 Million Ponzi Scheme About to Implode

The SEC alleges Agridime used at least $58 million in investor funds since December 2022 to pay returns on existing investors instead of buying, feeding and marketing cattle. Agridime was not buying enough cattle to fulfill its contracts or obligations, the SEC stated, “and as a result, Agridime has only been able to return principal and pay promised returns by making Ponzi payments.”

The SEC laid out Agridime’s cattle contracts, investments and liabilities, stating that as of Sept. 5, 2023, Agridime had cattle contracts requiring it to pay investors more than $123 million in principal and another $24 million in guaranteed profits. That was despite only having potentially $1.5 million in the checking account.

The states of Arizona and North Dakota earlier this year had each filed cease-and-desist orders against Agridime, but the company continued to sell its cattle contracts in those states, including $9 million in contracts in North Dakota and $1 million in Arizona. An Agridime salesman admitted under oath in October that he is still selling cattle contracts in Arizona, the SEC stated.

According to the SEC, Agridime typically solicited investors on its website, as well as social media. The SEC alleges the contracts operated like unregistered securities, which is why the SEC took the lead in bringing a case against the company.

On its website, Agridime states the company “is an online cattle and agricultural products brokerage company that utilizes a proprietary trading platform to connect buyers and sellers.” The website added, “We are registered with the USDA and bonded in accordance with the P&S (Packers and Stockyards) Act.”

The SEC stated that gave the appearance to investors that the cattle contract investments were protected by USDA bonding and insurance. Yet, the SEC maintains new investment dollars went to pay promised returns to earlier investors, “thus

Ripple hopes judge ruling in SEC case will lead to US banks using XRP

In this photo illustration, a visual representation of the digital Cryptocurrency Ripple is displayed on January 30, 2018 in Paris, France. 

Chesnot | Getty Images

Blockchain startup Ripple is confident U.S. banks and other financial institutions in the country will start showing interest in adopting XRP in cross-border payments after a landmark ruling determined the token was not, in itself, necessarily a security.

The San Francisco-based firm expects to start talks with American financial firms about using its On-Demand Liquidity (ODL) product, which uses XRP for money transfers, in the third quarter, Stu Alderoty, Ripple’s general counsel, told CNBC in an interview last week.

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Last week, a New York judge delivered a watershed ruling for Ripple determining that XRP, a cryptocurrency Ripple is closely associated with, in itself was “not necessarily a security on its face,” contesting, in part, claims from the U.S. Securities and Exchange Commission against the company.

Ripple has been fighting the SEC for the past three years over allegations from the agency that Ripple and two of its executives conducted an illegal offering of $1.3 billion worth via sales of XRP. Ripple disputed the claims, insisting XRP cannot be considered a security and is more akin to a commodity.

Ripple’s business suffered as a result, with the company losing at least one customer and investor. MoneyGram, the U.S. money transfer giant, ditched its partnership with Ripple in March 2021.

Meanwhile, Tetragon, a U.K.-based investor that previously backed Ripple, sold its stake back to Ripple after unsuccessfully trying to sue the company to redeem its cash.

Asked whether the ruling meant that American banks would return to Ripple to use its ODL product, Alderoty said: “I think the answer to that is yes.”

Ripple also uses blockchain in its business to send messages between