Lawyers representing Do Kwon, the founder of the collapsed Terra blockchain, requested a U.S. court dismiss charges brought against him by the U.S. Securities and Exchange Commission (SEC) in a Friday court filing claiming a lack of jurisdiction. According to the lawyers, the SEC cannot regulate digital assets involved in the case because the now-defunct UST stablecoin was a currency, not a security. (Though SEC Chair Gary Gensler has said in the past that stablecoins fall under his remit.) Kwon was arrested in Montenegro last month and will soon be indicted for passport forgery as he attempted to flee to Costa Rica. He also faces criminal fraud charges in the U.S. and capital-market law violations in his native South Korea.
New Rulings
A federal court in California ruled conceptual artist Ryder Ripps and Jeremy Cahen, who created a non-fungible token (NFT) series based on the Bored Ape Yacht Club, had violated trademarks belonging to Yuga Labs, the corporate owner of the BAYC and several other popular NFT collections. Ripps and Cahen claimed they created the spinoff “RR/BAYC” collection as a satire of the original BAYC series, which Ripps said includes racist and offensive imagery. Yuga Labs sued Ripps and his associates in June 2022, and Ripps was ultimately found to be illegally profiting from knockoffs and confusing potential buyers. He intends to appeal the decision.
Global Spotlight
The Reserve Bank of Zimbabwe (RBZ) plans to launch a gold-backed digital currency as legal tender to stabilize the country’s local currency. These tokens will be backed by the country’s gold reserves and are designed to help citizens hedge against the volatility of the Zimbabwe dollar (ZWD). Meanwhile, in France, authorities will allow existing crypto companies to fast-track registration after the landmark MiCA ruling. The country toughened its crypto registration procedures following the FTX exchange’s collapse. Finally, crypto exchange Gemini plans to create an offshore derivatives platform. The foundation’s first product will be a perpetual bitcoin (BTC) contract denominated in Gemini’s stablecoin, GUSD, followed by a perpetual ether (ETH) contract.
Off-Chain Signals
Former BlackRock Global Equities Head Running Crypto Fund (Blockworks)
Bitfinex wants restitution as victim of shadow bank Crypto Capital Corp (Protos)
Most DeFi Protocols Fade After They’re Hacked, Analysis Shows (The Defiant)
The Takeaway: Creating Consensus
Joon Ian Wong, a journalist turned consultant and conference organizer, was one of CoinDesk’s earliest employees. He covered the scene back when “the crypto market” was composed of only bitcoin and its various hard forks and wrote profiles of the luminaries of the time (see below). Most importantly, however, Wong helped create Consensus – the flagship conference for CoinDesk, which has developed into something of a “Big Tent” event where all parts of the crypto industry can meet. He now runs his own conference consultancy, Amplified Event Strategy, which he founded during the height of the coronavirus crisis.
CoinDesk caught up with Wong ahead of Consensus 2023 in Austin, Texas, which also marks the publication’s tenth anniversary. We spoke about his early beat and what it was like watching the crypto industry mature. (Keep an eye out for “CoinDesk Turns 10,” a series we’re producing about the most pivotal events in crypto history.) The conversation has been edited for length and clarity.
The conversation has been edited for length and clarity.
What were the vibes of conferences like back then – it was technically a bear market, no?
I only went to one at the time, something called Coin Summit in London, organized by an investor. I remember there were people from Peter Thiel’s Founders Fund – VCs, founders. It was essentially a Silicon Valley tech conference, as opposed to something ideological like the Bitcoin Foundation ones. The biggest conference back then was probably the big one in Amsterdam in 2014. That had a festival-ish feel to it crossed with a political rally. I’m saying this not as an attendee, but somebody who read coverage of it. Consensus aimed to be more about business, talking shop.
When would you say the lifestyle elements of crypto started filtering in?
The crypto lifestyle is basically the same as that of a “tech nomad,” but with money, right? Instead of being a broke freelance writer in Bali, you actually have [a load] of money and you fly business class and stay in nice hotels or at least nice Airbnbs. And you don’t really care where you have dinner. I think, you know, there are people who live that lifestyle who go from country to country.
Anyone who you’re completely surprised at how they turned out?
I did a profile of a young former trader named Arthur Hayes. You can Google around CoinDesk.com and see. I would message Arthur for, you know, comments on the bitcoin price. There were no market analysts back then you could ask for comments. There were traders and that was it. Arthur was just a guy with some professional Wall Street experience. There’s like this joke: Bitcoin went up a quarter and then quickly went down and I’d asked him why that happened. And he would always give some intelligent response. But I knew he was in Hong Kong, and I would always check the time and he’d reply to me at 6 a.m., 4 a.m. until 10 p.m. He would always respond immediately. It was always a mystery to me. But, you know, I guess he was very busy building the BitMEX [exchange]. It’s interesting looking back at those early sources and thinking about what they were like versus where they ended up today. You know, this person did this or that or they ended up in jail or they’re a convicted felon. All of which can be true for one person.
This is fun. Give me another one.
I never would have thought Vitalik could have become quite the icon that he is today. Or that Katie Haun would be one of the most successful VCs of all time. Or even that Arthur Hayes would have this redemption narrative. For most people I think it would have been quite difficult to predict where they ended up today. Perhaps even Brian Armstrong. This is not directly CoinDesk related, but I interviewed him in 2014 when he came to London as part of this big Coinbase world tour. You have to remember Coinbase started out as a wallet, competing with the Blockchain Dot Info. There was no exchange business. I think it was the world tour when they pivoted to become a brokerage. We had the interview near the CoinDesk office in Fitzrovia in London, and then that evening there was this very long-running meetup called Coin Scrum, which has been running since 2013, at a bar in East London near where I live. It was a packed house. You know, Brian Armstrong is gonna come and talk to us (even back then Coinbase was one of the better-funded startups). So he gave his talk and I remember a band of people came into the bar led by Amir Taaki [who, at the time, was one of the most prominent Bitcoin Core developers] and started heckling him. You know, “you’re centralized.” “You’re fiat.” There were three or four of these guys, who I think all lived in the same East London squat, shouting at him from the crowd. Even back then, he was very even-tempered. He was trying to respond to them point by point. But he kind of got drowned out. There’s this sort of endearing image of the space back then. I just don’t think you’ll ever see Brian Armstrong and Amir Taaki in the same room ever again. People like Gavin Wood or Vitalik, they would go to these meetups and bars and try to convince people that their thing – Ethereum, whatever – was this great, wonderful thing. You’d have a motley crew of people listening to them. And from those very unlikely beginnings, you have kind of these quote unquote corporate titans of the day.
I tend to excuse the worst aspects of crypto by saying “it’s future-forward.” We’ve seen a lot of pushback on the idea recently – with people asking, it’s been 13 years, what does the industry have to show for it? Do you think we even know what crypto is for yet?
I mean, it’s a cliche, but we’re still early. If you think about [artificial intelligence], for example, you might claim you can trace its lineage back to cybernetics in the 1950s and only today do we have decent chatbots. I still think digital scarcity is the main innovation of crypto, and we are still playing at the edges of what that really means, particularly as digital material, you know, digital stuff, proliferates exponentially. This is kind of the counterweight to the original thought of the internet as this utopian place of abundance. You can copy everything. It’s boundless. There’s just more and more and more stuff. We’re only now discovering that, you know, all this stuff isn’t great – like, there’s a lot of downsides and more and more stuff. Crypto is a counterweight to that big overarching trend that’s been happening since the commercialization of the internet in the 1990s. It adds a little friction.
It’s not too late to register for Consensus 2023! Join us in Austin, Texas April 26-28 to recalibrate, collaborate and find resolution amid one of the most tumultuous times in crypto history.
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