SEC - Page 132

Hong Kong-based cryptocurrency exchange Gate.HK has shut down after failing to meet the upcoming local licensing requirements set to take effect on June 1.

The Hong Kong Securities and Futures Commission (SFC) mandated that all crypto exchanges in the region acquire an operational license, requiring those that failed to apply to cease services by May 31.

Gate.HK applied for a license on February 28, but withdrew the application on May 22, citing the need for a “major overhaul” of its trading platform.

As of May 23, Gate.HK has stopped acquiring new users and ceased all marketing activities.

Current users can no longer make deposits and are only able to withdraw funds until August 28.

The exchange will permanently delist all tokens, including Bitcoin, Ether, Solana, Polygon (MATIC), and Tether (USDT), on May 28, effectively shutting down its trading platform.

Gate.HK plans to relaunch its services once its platform is reconstructed to comply with Hong Kong’s regulatory requirements, which include establishing Anti-Money Laundering and Counter-Terrorist Financing measures.

The company stated, “Gate.HK is actively working on the aforementioned overhaul.

READ MORE: Bitcoin Surges Past $70,000 Amid Massive Short Liquidations and ETF Speculations

“We plan to resume our business in Hong Kong in the future and contribute to the virtual asset ecosystem after obtaining the relevant licenses.”

The closure of Gate.HK coincides with the announcement of another major global exchange, OKX, which stated on May 24 that it would exit the Hong Kong market.

OKX will cease providing centralized virtual asset trading services to Hong Kong residents by May 31, 2024.

The announcement reassured customers, saying, “Customer funds remain safe, and withdrawal services will not be affected. After May 31, 2024, customers can only withdraw.”

Prior to Gate.HK’s exit, three other exchanges — Huobi HK, QuanXLab, and IBTCEX — also withdrew their license applications in May.

Additionally, a recent Bloomberg report indicated that the SFC is considering allowing spot Ether exchange-traded fund (ETF) issuers to include an ETH staking option to generate passive income.

The SFC is currently discussing providing staking services via licensed platforms with the country’s crypto ETF issuers, although no timeline for implementation has been set.

To submit a crypto press release (PR), send an email to sales@cryptointelligence.co.uk.

Korean regulators face increasing pressure to approve cryptocurrency exchange-traded funds (ETFs) following the recent approval of spot Ethereum ETFs by the United States Securities and Exchange Commission (SEC).

Local media reports suggest that the SEC’s decision on Ethereum could influence Seoul’s financial regulators to reconsider their approach to digital assets.

The SEC approved the creation of ETFs for Ethereum, the world’s second-largest cryptocurrency, on May 24, 2024, after previously greenlighting Bitcoin ETFs in January 2024.

ETFs are financial instruments allowing investors to gain exposure to a basket of securities. Approving crypto ETFs is seen as a significant step in integrating traditional finance with the digital asset industry.

In contrast to the U.S., the Korean Financial Services Commission (FSC) and Financial Supervisory Service (FSS) have been cautious about introducing crypto asset trading on traditional securities markets.

According to the FSC, ETFs must adhere to the Capital Markets Act, which mandates that they be linked to traditional underlying assets.

These assets include established financial instruments, securities, international currencies, and commodities, providing the foundation for financial derivatives.

READ MORE: SEC Approves Spot Ether ETFs: A Different Path from Bitcoin ETFs

The Financial Services Commission, a government agency, oversees and regulates financial institutions and markets in South Korea.

In early February, the South Korean government updated the Virtual Asset Users Protection Act.

According to the Korea Times, Xangle, a leading digital currency data provider in Seoul, criticized the ban on digital assets in the traditional securities market, calling it “outdated” and in need of revision to reflect the growing importance of digital assets in modern finance.

“Under the circumstances, the SEC’s Thursday decision on Ethereum is anticipated to press Seoul’s financial regulators to reconsider its regulations against digital assets,” noted Xangle.

Jung Eui-jung, head of the Korean Stockholders’ Alliance, emphasized the need for Seoul to follow the U.S.’s lead in approving Bitcoin and Ethereum ETFs.

He highlighted the frustration caused by the current regulatory hesitance, which extends beyond the crypto sector.

Jung warned that if Seoul regulators continue to lag while the U.S. progresses, investors might move their funds to U.S. markets.

He predicted that it is only “a matter of time for the U.S. to fully open the door for other less-traded cryptocurrencies.”

To submit a crypto press release (PR), send an email to sales@cryptointelligence.co.uk.

Apple has denied being a “monopolist” and insisted it faces “fierce competition” in the tech industry, according to a letter previewing its defense against a U.S. antitrust lawsuit.

In a letter dated May 21 to New Jersey federal judge Julien Neals, Apple’s attorneys requested a conference before filing a motion to dismiss the case.

They refuted U.S. allegations that Apple engaged in anticompetitive practices by restricting third-party access to its platform and designing products to “lock in” users to purchasing iPhones.

The company argued that its purported anticompetitive behavior merely involved making independent decisions regarding the terms and conditions for third-party access to its proprietary platform.

In March, the Justice Department filed an antitrust lawsuit against Apple, accusing the firm of holding a smartphone monopoly.

The suit claimed Apple restricted features of digital wallets and payments and enforced App Store rules that stifled competition.

Apple’s restrictions on fiat-only payments have also impacted the use of cryptocurrencies in iOS apps, making it financially unfeasible for crypto apps to offer in-app purchases due to a 30% fee known as the “Apple Tax.”

“Apple has opted to offer users a curated, secure, and reliable experience, in contrast to its competitors’ more open platforms,” the company stated.

Apple contended that the government did not “properly define the relevant market or establish that Apple has monopoly power in it,” and any alleged anticompetitive behavior occurred in different markets, such as digital wallets.

READ MORE: Bitcoin Hovers Near $67,000 as Traders Eye Key Resistance and Support Levels

“These products all exist in their own separate markets with their own competitive dynamics, and the Government’s failure to define the proper market for those products is fatal,” Apple asserted.

Apple further argued that the U.S. claims were invalid, citing the Supreme Court’s stance that a company’s decisions regarding third-party dealings do not constitute exclusionary conduct.

The company also countered the DOJ’s claim of a smartphone monopoly, asserting it faces strong competition from Google and Samsung, noting Google has the most-used mobile OS and Samsung leads in global smartphone sales.

The U.S. failed to provide a factual link demonstrating that Apple’s design decisions corner smartphone buyers, Apple claimed.

“Someone unhappy with Apple’s limitations has every incentive to switch to competitor platforms that ostensibly do not have those limitations,” the company stated.

Following the DOJ’s March filing, an Apple spokesperson told Cointelegraph that the lawsuit could “set a dangerous precedent” and potentially allow the government to heavily influence the design of technology.

To submit a crypto press release (PR), send an email to sales@cryptointelligence.co.uk.

Ether (ETH) could potentially retest the $5,000 price mark it narrowly missed in 2021 if three long-term indicators continue their current trends, according to one crypto trader.

“The dominance chart suggests we’re entering an ‘ETH Season’ where Ethereum is likely to outperform other cryptocurrencies,” said pseudonymous crypto trader Blockchain Mane in an interview with Cointelegraph.

This optimism follows the United States Securities and Exchange Commission’s (SEC) initial approval of eight spot Ether exchange-traded funds (ETFs) on May 23.

Data from TradingView reveals that ETH’s market dominance surged by 19.56% over the past week after reports suggested the SEC was shifting its stance on ETF approvals.

Blockchain Mane highlighted another key long-term indicator: the Fibonacci retracement.

This indicator predicts potential price levels where Ether might rebound, based on mathematical patterns from the Fibonacci sequence.

According to Mane, ETH is showing “resistance targets at $5,080.60 and $6,231.83.”

These levels are significantly higher than its all-time high of $4,878 in November 2021, as reported by CoinMarketCap.

At the time of publication, Ether is trading at $3,802.

READ MORE: Bitcoin Battles to Hold $69,000 as Analysts Eye Potential Retracement

The third indicator noted by Blockchain Mane is the parabolic curve, which identifies potential trend changes by placing dots above or below Ether’s price movements.

Mane observed that ETH is following a “bullish trend” along the curve, with three distinct phases: base one, base two, and base three.

“The parabolic curve indicates continued upward movement, especially after the falling wedge breakout,” Mane said.

Meanwhile, other crypto traders are focusing on shorter-term price actions amid the spot Ether ETF approvals.

“ETH is up more this week than the S&P 500 typically gives you in a year,” crypto commentator Benjamin Cowen said in a May 23 X post.

Crypto trader Matthew Hyland emphasized the importance of Ether holding support around $3,800 for continued momentum.

The price of Ether has remained relatively stable following the ETF approvals, likely because the news was already priced in and ETF trading has not yet begun.

To submit a crypto press release (PR), send an email to sales@cryptointelligence.co.uk.

Democratic Party members of the United States House of Representatives are not mandated to vote against two upcoming pro-crypto bills, though they are strongly advised to do so.

A May 20 email from Democratic Party leaders to House members, shared by Politico, indicates the party has not insisted on a “no” vote for the Republican-led Financial Innovation and Technology for the 21st Century (FIT21) Act and the CBDC Anti-Surveillance State Act, known as H.R. 4763 and H.R. 5403, respectively.

Both bills are seen as favorable to the crypto industry if passed. FIT21 would clarify the classification process for cryptocurrencies as either commodities or securities, primarily placing regulatory control with the U.S. Commodity Futures Trading Commission (CFTC).

The U.S. crypto industry and lobbyists back this bill, with 60 companies advocating for its passage in a May 16 letter.

The CBDC act aims to prevent the Federal Reserve from issuing a central bank digital currency.

However, the email noted that Representatives Maxine Waters and David Scott “strongly oppose” FIT21, and Waters also opposes the CBDC act.

Politico later obtained a letter from the pair urging a vote against FIT21.

“House Democratic leaders said today they will NOT whip against House Republicans’ crypto bill, I’m told,” Politico reporter Eleanor Mueller wrote on X, referring to FIT21.

In the email, Democratic leaders expressed concerns about parts of the bill, particularly its provision for trading digital commodities in the secondary market if they were initially offered as investment contract securities under the SEC’s Howey test.

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“This language undermines decades of legal precedent and case law, thereby creating uncertainty in our traditional securities market,” the email stated.

Leaders argued the bill “weakens investor protections and opens the door to fraud and market manipulation” by providing a “safe harbor” for entities to register intent, effectively shielding them from the SEC until crypto rules are finalized by both the SEC and CFTC.

Meanwhile, the CBDC Anti-Surveillance State Act aims to prevent the Federal Reserve from issuing a CBDC, even in pilot programs.

Democratic leaders contend that stopping CBDCs could undermine the “primacy of the U.S. dollar,” as other countries with CBDCs seek to evade sanctions.

“According to the Congressional Budget Office (CBO), the bill’s overly broad definition of CBDC raises concerns the bill could undermine the Fed’s ability to conduct monetary policy,” the email added. “Particularly concerning as it attempts to navigate a soft landing in regard to inflation.”

Floor debate and passage of FIT21 are expected on Wednesday, May 22, according to Politico’s Mueller.

To submit a crypto press release (PR), send an email to sales@cryptointelligence.co.uk.