Top Stories This Week
Coinbase argues stocks, Terraform Labs and Howey in 5-hour SEC face-off
United States District Judge Katherine Polk Failla has heard arguments from the U.S. Securities and Exchange Commission (SEC) and Coinbase on the crypto exchange’s motion for dismissal of a lawsuit filed by the regulator in June 2022. The hearing was held for nearly five hours and provided an extensive overview of the key arguments in courts regarding the crypto space, assets and the SEC’s role in regulating the industry. During the hearing, the SEC argued that buyers of tokens are also investing in the network or ecosystem behind it, indicating there is a value proposition behind a token purchase. Coinbase’s attorneys, however, challenged the argument, claiming that Bitcoin — described as a commodity by an SEC attorney during the hearing — is also backed by a community and has a network.
Sam Bankman-Fried’s parents seek dismissal of FTX clawback lawsuit
The parents of former FTX CEO Sam Bankman-Fried are seeking to have FTX’s lawsuit against them dismissed, rejecting claims that they knew about the problems at the crypto exchange and knowingly benefitted from misconduct at the firm. According to a court filing, lawyers representing Joseph Bankman and Barbara Fried argued that FTX’s lawsuit sought to “capitalize on the sheer fact” that they were the parents of the former FTX CEO. In September 2023, FTX sued Bankman and Fried for allegedly exploiting their influence and access within the FTX empire to enrich themselves.
Ethereum Dencun upgrade goes live on testnet after 4-hour delay
The newest upgrade to the Ethereum network, codenamed “Cancun-Deneb” or “Dencun,” has gone live on the Goerli testnet for the first time, according to a Jan. 17 social media post from Ethereum developer Parithosh Jayanthi. A bug delayed the network’s launch for approximately four hours. Once implemented on the mainnet, the Dencun upgrade will significantly lower the cost of transactions on Ethereum layer 2s such as Optimism, Base, Polygon zkEVM and others, developers have claimed. It will also limit self-destruct operations and allow for new bridge and staking pool features.
IRS steps back crypto tax rules, exempting TXs over $10K from obligations
United States businesses won’t yet need to report cryptocurrency transactions above $10,000 to the Internal Revenue Service (IRS) until the tax agency releases a regulatory framework. The decision follows a revision of the Infrastructure Investment and Jobs Act by the U.S. Treasury Department and the IRS. The law came into effect on Jan. 1 and required all U.S. businesses to report crypto transactions over $10,000. However, the tax regulator has stepped back from enforcing the rule for now. The IRS said it and the Treasury intend to issue proposed regulations concerning digital asset reporting but didn’t specify when they would be introduced.
Spot Bitcoin ETFs scoop up another 10,600 BTC on day 5
Issuers of Bitcoin exchange-traded funds (ETFs) added another net 10,667 Bitcoin to their spot products on the fifth trading day amid increasing volume. Data compiled by X account CC15Capital for Jan. 17 shows that a net $440 million in Bitcoin was added to funds’ holdings at the end of the day. BlackRock’s ETF accounted for the lion’s share of the purchases with 8,700 BTC, worth nearly $358 million. The data also shows that nine ETFs (excluding Grayscale) have purchased nearly 68,500 BTC since their launch, currently worth around $2.8 billion. The funds also saw a 34% jump in daily volume as of the fifth day of trading.
