Two crypto bills received a stamp of endorsement from a major congressional group before they head off to the House of Representatives for a vote. Following a day-long markup session on Wednesday the “Financial Innovation and Technology for the 21st Century Act” and “Blockchain Regulatory Certainty Act” were ultimately advanced onto the next phase of the regulatory process – a significant step for the U.S. legal system which has yet to write comprehensive crypto laws. That said, a number of Republicans and Democrats refused to support the so-called “market structure bill” in part because it would allocate more power to the Commodity Futures Trading Commission (CFTC) without expanding its budget (though it still passed with 35-15 vote).
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An in-depth look into the latest advancements and current challenges in crypto and bitcoin mining
From an ASIC-heated swimming pool to a handmade soundproof container, these die-hards found ways to make home mining feasible, if not quite profitable.
It’s all about solving “the duck curve” problem on the grid
Halving Awaits
Computing power on the Bitcoin network, known as hashrate, could drop by as much as 30% as unprofitable miners shut off their rigs after the next halving event, expected in April 2024, experts said Wednesday in a Twitter Spaces hosted by CoinDesk. Lucas Pipes, Managing Director at investment bank B. Riley Financial, estimated a 15% to 30% decline in Bitcoin’s hashrate. Colin Harper, head of content at mining services firm Luxor Mining, said a 20% drop was possible. Meanwhile, as the prices for bitcoin mining machines crater a few well-funded organizations are buying up lots.
Let Him Fry?
The U.S. Department of Justice wants FTX founder Sam Bankman-Fried to spend the remainder of his time before his criminal trial in jail, alleging he has tried multiple times to tamper with witnesses. Bankman-Fried, flanked by two attorneys, appeared in federal court Wednesday, after the DOJ alleged he shared documents with the New York Times to try and discredit former Alameda Research CEO Caroline Ellison, with whom he’d previously been in a relationship with. While Judge Lewis Kaplan, of the Southern District of New York, declined to jail Bankman-Fried immediately, he set out a rapid schedule for both the prosecution and the defense to make formal written submissions on the matter. Meanwhile, due to a legal misunderstanding in Bankman-Fried’s extradition from the Bahamas, the DOJ will temporarily drop its campaign finance charges against the FTX founder.
The Takeaway: Farage & Fabricating Norms
(Wikimedia)
Nigel Farage, the lizard-skinned British politician who kickstarted Brexit, is a totem for crypto, whether he knows it or not. (Or if you, like some here at CoinDesk, even like it.)
So swallow your pride, and suck up any misgivings because what happened recently to Farrage in the U.K. is a warning for us all.
It’s no secret that banks – whether in the U.S., U.K. or anywhere in the world – have been debanking people for decades. This often comes with little warning or hope to appeal, and it completely disrupts someone’s ability to exist in modern society. In the early days of crypto, for instance, countless people who interacted with exchanges or other crypto service providers found their accounts unceremoniously closed.
So Farrage’s story isn’t all that new – although it is different in the sense that, unlike most, the wealthy Tory had a bully pulpit to stand on.
In short, Coutts – a private bank owned by NatWest, which itself has an extremelycheckered past – closed Farage’s account because he holds the wrong views.
This, of course, is abhorrent and has rightfully caused a few black eyes in the media and at the bank after an apparent cover up was uncovered. When the news first broke, Farage was basically made out to be a conspiracist who claimed he was being “canceled.” The bank, lying, said it closed his account because his balance had fallen below the minimum £1 million (~$1.3 million).
But after a BBC retraction, an apology from NatWest CEO Alison Rose and now her resignation, it can be said that politics was absolutely determinative in Coutts’ decision to fire Farage as a client.
Rose’s fate was essentially sealed last week when Prime Minister Rishi Sunak unexpectedly stuck his neck out for Farage, saying, “It’s not right for anyone to be denied financial services because they’re exercising their lawful right to free speech.”
And, true enough, you might loath the former member of the European Parliament turned “eurosceptic” Farage. But the guy has a right to a bank account, as much as he does his views.
But does he? Obviously for anyone who thinks there are basic human rights, Rose and Coutts did wrong by Farage (who, incidentally, is also a public supporter of Bitcoin). But, in many ways, Rose’s only real crime was in lying to the public, the government and the bank’s investors, and had that not happened – and she come right out and said Coutts is cutting ties with Farage because he is unscrupulous – how many people would be willing to say she made the right decision?
Let’s remember that there’s another political valence to this story. The 53-year-old banker, reportedly the first woman to lead a major British bank, was apparently a champion of “purpose-led” corporate governance who worked to extricate the once important oil and gas lender from those entanglements. In short, she was woke (at least in the minds of some of Farrage’s staunchest supporters).
Insofar as the CEO of any bank could be said to be radical, Rose was a symbol for societal progress on one side of the political divide and all the forces working to stymie Farage’s brand of British nationalism on the other. What seems like a simple issue – should Farage get to speak his mind and get to bank – is only simple now in retrospect, after a bigger crime was revealed.
For example, if the shoe were on the other foot, hypothetically, would Farage’s supporters campaign for someone like the lefty Jeremy Corbyn to keep his bank account? It’s all just speculation, but the right-coded platforms like Parler and “anti-woke” bank GlorFi (now defunct) weren’t exactly bastions of free speech. And how many people were willing to defend Kanye when he was on an anti-semetic kick that cost him his wealth manager and Chase account?
To a degree, some of the only consistent defenders of the right to bank are those in crypto – who know what it’s like being de-banked. My colleague, David Z. Morris called this group the “financial ACLU,” (I think referring to the days when the famed civil rights organization was more consistent in its support of speech rights). It’s ironic, too, because crypto has its own homegrown solutions to banking challenges: take the politics, passions and people out of the equation.
We like to tell ourselves that modern life is built on a bedrock of unshakeable liberal values, but in reality, decisions are always subject to contemporary prejudices. For instance, there’s a “classically liberal” argument to make that, actually, Farage does not have the right to bank anywhere. Banks like all businesses should be able to exercise judgment and discretion in choosing who to serve. There are other banks in the world afterall, and clearly Farage was not being silenced.
Things worked out, I guess, in the end for Farage. He’s a martyr to his fans, and those who hate him must begrudgingly accept that he was done wrong. But what of the countless others who are de-banked every year? Not for their political views, but for overdrafting their accounts by $5? Why is there no sustained outrage? Because, deep down, we all know it’s useless to try to hold institutions to account or to our highest ideals.
For all the other times that you can’t count on populist outrage, there’s crypto.
It is now more important than ever to set industry standards and align on practical short-term and long-term objectives through pointed conversations with the best legal minds and Washington D.C.’s most important decision makers.
Join us at State of Crypto: Policy and Regulation on October 24 in Washington D.C. for an unprecedented opportunity to evaluate, dissect and ultimately shape crypto regulatory frameworks that support a vibrant, secure and healthy future for the digital economy.
