In this week’s edition of The Context, Visa and X (née Twitter) take steps toward crypto payments while BlackRock gets put on hold by the SEC. Here are the top stories and how they were covered, along with YAP Global’s take:
[X Collects Money Transmitter Licenses ©️]
After receiving a currency transmitter license from Rhode Island last week, Elon Musk’s X now has money or currency transmitter licenses from seven U.S. states, including Arizona, Georgia, Maryland, Michigan, Missouri, and New Hampshire. 🇺🇸
What Journalists Said 🧑💻:
Seven is more than three. That’s the number of licenses X (née Twitter) had two months ago, per earlier reporting from Leo Schwartz and Kylie Robison (Fortune). By July, Musk was already working to transform the social media platform into an “‘everything app’ in the vein of WeChat, where users can do anything from messaging to shopping to sending money to one another.”
The newer licenses, the same ones held by Western Union and PayPal, will help Musk in the goal of sending payments, wrote Sandali Handagama (CoinDesk). But don’t jump to conclusions: “Though they certainly open the way for offering crypto payments, the state licenses are not limited or unique to that service.” 🦘
PR Perspective 📢:
X has been under constant scrutiny since its controversial rebrand. This FinTech upgrade could add fuel to the fire given that it contradicts Musk's claim that the purpose of purchasing, what was then Twitter, was to protect freedom of speech. On the other hand, if turning X into an "everything app" is successful it could completely revert negative perceptions of his controversial purchase. Time will tell. ⏱️
[SEC Delays Bitcoin ETF Decisions 🐌]
The U.S. Securities and Exchange Commission has delayed its decision on spot Bitcoin ETF applications from six firms, including BlackRock and Fidelity, until at least October.
What Journalists Said 🧑💻:
The delay comes on the heels of a court ruling that the regulator’s denial of a Grayscale ETF was based on flawed reasoning, wrote André Beganski and Stacy Elliott (Decrypt). 👠 But that “court ruling isn't the same as an approval.”
Expect further delays on the path to the first spot Bitcoin ETF, said Nikhilesh De (CoinDesk), as the agency has 240 days to decide: “SEC staff have traditionally used every possible comment and review period to delay making final decisions until those 240 days have elapsed.”
Crypto prices had shot up after the Grayscale ruling, said Patricia Kowsmann and Jack Pitcher (WSJ). But thanks to this delay, Bitcoin has “given up” those gains.
Why It Matters⁉️:
If it bleeds, it leads—and when it comes to crypto, the SEC is out for blood. Following Grayscale’s massive win last week, the SEC has delivered a solid jab to the hopes of the crypto industry—and deflated Bitcoin’s price in the process. 📉
[Visa Enables USDC Payments on Solana 💲]
Building off a previous pilot with Crypto.com, 👩✈️ Visa will start sending some merchants USDC stablecoin on the Solana blockchain to settle payments.
What Journalists Said🧑💻:
Visa hasn’t been deterred by crypto’s public failures, said Ben Strack (Blockworks), forging ahead with a “strategy of being a bridge between traditional finance customers and the cryptocurrency ecosystem.” 🌉
Stablecoins can “speed up bank transfers,” wrote Ben Weiss (Fortune). But why Solana? It gets the nod “because of the blockchain’s capacity to process transitions more quickly than on Ethereum’s.” ⏩
Solana’s price jumped on the news as other coins languished, reported Tanaya Macheel (CNBC). ⛽ Having more than doubled in price since the start of the year, it's “one of the biggest” gainers in crypto.
Why It Matters⁉️:
This is a major win for the Solana ecosystem. Since the collapse of FTX and arrest of Sam Bankman-Fried, who was heavily invested in Solana, SOL and the Solana ecosystem have been in the dumps. 🗑️ The expansion of Visa’s stablecoin settlement to Solana bolster’s the altchain’s reputation for being cheap and scalable. Could we begin to see an uptick in user activity?
[Tweet of the week]
Credit: @CasPiancey
[DeFi Definitions]
A segment exploring one particular aspect of DeFi.
This week: “Decentralised Order Book” by Ruth De Freitas.
A decentralised order book is a trading mechanism where buy and sell orders on an exchange are matched through a distributed network of nodes, rather than being centralised in a single location or controlled by a single entity. In a decentralised order book, users can submit orders and execute trades without the need for intermediaries or central authorities.
Decentralised order books are typically powered by blockchain technology, which enables secure and trustless peer-to-peer transactions. The order book maintains a record of all buy and sell orders on the network, and the matching process is automated using smart contracts. The order book operates on a decentralised network, which ensures that no single entity has control over the platform.
By contrast, centralised order books are managed by a single entity that controls the platform and the matching of buy and sell orders. The centralised approach relies on intermediaries such as centralised exchanges, brokers, market makers, and custodians to facilitate trades, which can lead to higher fees and reduced transparency.
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, Sam O'Donohoe, Ewan Brewster, Damian Alvarez, Andrew Wickerson, Tiffany Mac Sherry, Becky Corbel and Delon Chan. Your feedback is, as always, welcome. Ping us at thecontext@yapglobal.com. Old newsletters can be found here.
This newsletter is prepared by YAP Global, an international P.R. Consultancy focusing on helping cryptocurrency, Decentralised Finance (DeFi) and Web3 brands through impactful storytelling. Find out more about us here.