SEC Goes on the Atkins Diet
Plus: The XRP Army marches on 🥁
In this week’s edition of The Context, we look at President-elect Trump’s choice for Securities and Exchange Commission chair, why XRP is back in the top three, and a trio of announcements from Coinbase.
[Musical chairs 🎶🪑]
After Unchained reported on Tuesday that Donald Trump had offered the SEC chair to former commissioner Paul Atkins, Trump made it official on Wednesday.
What Media Said 🧑💻:
Atkins, who founded advisory group Potomak General Partners, is “widely respected in conservative legal circles” and became “outspokenly supportive of the crypto industry” after leaving the SEC, said Veronica Irwin (Unchained).
He’s a “crypto enthusiast,” declared Chris Stokel-Walker (Fast Company). The Token Alliance co-chair testified before Congress “about the benefits of reducing regulations on crypto” and said in interviews that the SEC’s role should be helping new “markets to flourish” so they can lower costs for investors.
But it wasn’t so clear Atkins would take the role. He was “hesitant” to give up his business interests to “clean up what he sees as a bloated agency mismanaged by departing SEC chair Gary Gensler,” according to Christine Lee’s (CoinDesk) sources. Other interested candidates included crypto lawyer Teresa Goody Guillén and former acting Comptroller of the Currency Brian Brooks.
PR Perspective 🔎:
Most of the names on Trump’s rumored long list were reliably pro-crypto. A few of them were not. The Atkins pick shows the President-elect seems serious about ending what the crypto industry perceives as regulation by enforcement.
[’Don’t call it a comeback’]
XRP, the digital asset created by Ripple execs, has more than quadrupled in value since Election Day to become the third-largest cryptocurrency by market cap. Outlets are pointing to three reasons for the boost.
What Media Said 🧑💻:
XRP fell out of the top 5 after the SEC sued Ripple in 2020. “The surge in XRP’s price comes amid signs that the legal pressure that has been bearing down on Ripple for years is about to let up,” wrote Catherine McGrath (Fortune), and “pundits are predicting the agency is likely to drop a number of lawsuits as Trump prepares to take office.”
Meanwhile, according to people close to Ripple, the New York Department of Financial Services will greenlight the company’s RLUSD stablecoin, reported Eleanor Terrett (Fox Business).
Finally, “Wall Street is pushing for Ripple’s XRP to win a spot exchange-traded fund,” wrote Billy Bambrough (Forbes). ETFs helped push Bitcoin and Ether prices higher by making the assets available to traditional investors in the US. This week, WisdomTree became the third firm to file an XRP ETF proposal with the SEC.
PR Perspective 🔎:
XRP's 400% surge highlights crypto markets’ extreme sensitivity to political shifts.📈But the rapid institutional embrace of Ripple via ETF filings and RLUSD suggests a permanent evolution in XRP's market position and could set a precedent for how markets price crypto’s regulatory rehabilitation.
[Coinbased]
Coinbase made three moves this week that media outlets found newsworthy: adding plans to list more memecoins, integrating with Apple Pay, and proclaiming it will cut ties with law firms who hire anti-crypto SEC staff.
What Media Said 🧑💻:
The crypto exchange has listed multiple meme coins since the November 6 election ushered in Republican control of the presidency and both houses of Congress, noted Naga Avan-Nomayo (crypto.news). Those include Floki, Dogwifhat, Moo Deng, and, soon, Mog.
Coinbase added Apple Pay as a “payment method for Coinbase Onramp, its tool for building onramps into existing apps for fiat-to-crypto purchases,” wrote PYMNTS. Onramp is supposed to help newcomers start using crypto without jumping through hoops. And Coinbase sees the integration as a way for these users to convert cash to crypto quickly.
CEO Brian Armstrong won’t let Coinbase work with law firms that hire former SEC regulators “it sees as hostile to the crypto industry under the leadership of outgoing Chair Gary Gensler and the Biden administration,” wrote James Hunt (The Block). After Milbank hired the SEC’s former enforcement director in October, he wanted to make the industry’s position clear: “Let your law firms know that hiring these folks means losing you as a client.”
PR Perspective 🔎:
Coinbase's latest moves highlight the exchange’s metamorphosis — from a company that opted for caution while competitors played fast and loose to one that is totally comfortable articulating the agenda for the entire industry. Its decision to offer more meme coins combined with Armstrong’s SEC staff remarks suggest Coinbase is leveraging its market position to reshape industry-regulator dynamics. Additionally, Apple Pay integration, which tackles crypto's persistent UX friction, means it’s betting mass adoption is right around the corner.
[And one for the road]
Alex Mashinsky, the former CEO of bankrupt crypto lending firm Celsius, pleaded guilty to one count each of commodities fraud and securities fraud this week, explained Joel Khalili (Wired). Celsius offered as much as 17% interest on users’ deposits and ostensibly loaned out that crypto. As it turned out, Mashinsky was also using those deposits to invest in businesses that went bust. He’ll have to give back $48M in ill-gotten gains and could get as many as 30 years in jail when he’s sentenced in April. 🚔
[Tweet Of The Week]
Credit: @TheBTCTherapist
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