In this weekâs edition of The Context, we look at President-elect Trumpâs choice for Securities and Exchange Commission chair, why XRP is back in the top three, and a trio of announcements from Coinbase.
[Musical chairs đ¶đȘ]
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 đ§âđ»:
Atkins, who founded advisory group Potomak General Partners, is âwidely respected in conservative legal circlesâ and became âoutspokenly supportive of the crypto industryâ after leaving the SEC, said Veronica Irwin (Unchained).
Heâs a âcrypto enthusiast,â declared Chris Stokel-Walker (Fast Company). The Token Alliance co-chair testified before Congress âabout the benefits of reducing regulations on cryptoâ and said in interviews that the SECâs role should be helping new âmarkets to flourishâ so they can lower costs for investors.
But it wasnât so clear Atkins would take the role. He was âhesitantâ to give up his business interests to âclean up what he sees as a bloated agency mismanaged by departing SEC chair Gary Gensler,â according to Christine Leeâs (CoinDesk) sources. Other interested candidates included crypto lawyer Teresa Goody GuillĂ©n and former acting Comptroller of the Currency Brian Brooks.
PR Perspective đ:
Most of the names on Trumpâs 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.
[âDonât call it a comebackâ]
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 đ§âđ»:
XRP fell out of the top 5 after the SEC sued Ripple in 2020. âThe surge in XRPâs price comes amid signs that the legal pressure that has been bearing down on Ripple for years is about to let up,â wrote Catherine McGrath (Fortune), and âpundits are predicting the agency is likely to drop a number of lawsuits as Trump prepares to take office.â
Meanwhile, according to people close to Ripple, the New York Department of Financial Services will greenlight the companyâs RLUSD stablecoin, reported Eleanor Terrett (Fox Business).
Finally, âWall Street is pushing for Rippleâs XRP to win a spot exchange-traded fund,â 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 đ:
XRP's 400% surge highlights crypto marketsâ extreme sensitivity to political shifts.đBut 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 cryptoâs 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 đ§âđ»:
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 âpayment method for Coinbase Onramp, its tool for building onramps into existing apps for fiat-to-crypto purchases,â 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 wonât let Coinbase work with law firms that hire former SEC regulators âit sees as hostile to the crypto industry under the leadership of outgoing Chair Gary Gensler and the Biden administration,â wrote James Hunt (The Block). After Milbank hired the SECâs former enforcement director in October, he wanted to make the industryâs position clear: âLet your law firms know that hiring these folks means losing you as a client.â
PR Perspective đ:
Coinbase's latest moves highlight the exchangeâs metamorphosis â 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 Armstrongâs 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 itâs 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 usersâ deposits and ostensibly loaned out that crypto. As it turned out, Mashinsky was also using those deposits to invest in businesses that went bust. Heâll have to give back $48M in ill-gotten gains and could get as many as 30 years in jail when heâs sentenced in April. đ
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The usual disclaimer: This newsletter collates the main themes and headlines of the week in DeFi/crypto/metaverse/Web3/NFT land and tries to provide unbiased context. It's aimed at anyone who wants to keep an eye on the space. It's put together by a team at YAP and doesn't contain any promotion of our clients (if one is mentioned, we'll flag that).
The team: Founder Samantha Yap and consulting editor Jeff Benson, Andrew Wickerson, Emma Murphy, Nathalie Larrea, Trisha Goswami and Shajar Qureshi. Your feedback is, as always, welcome. Ping us at thecontext@yapglobal.com. Old newsletters can be found here.
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