Crypto market stays flat as Binance faces legal trouble and Citi predicts tokenisation boom
Data from CryptoCompare shows that the price of Bitcoin moved sideways for yet another week, trading at $28,000 throughout it, with a quick dip to $27,000 being quickly bought up at the beginning of the week. Currently, BTC is changing hands for $28,075.
Ethereum’s Ether, the second-largest cryptocurrency by market cap, moved similarly to BTC, trading at around $1,800 throughout the week after recovering from a short drop to the $1,700 level.
This week’s headlines in the cryptocurrency space were mostly focused on the U.S. Commodity Futures and Trading Commission (CFTC) filing a lawsuit against leading cryptocurrency exchange Binance and its co-founder and CEO Changpeng Zhao.
The lawsuit alleges the exchange evaded U.S. rules by soliciting users from the United States. In the lawsuit, filed in Chicago federal court, the CFTC pointed to both Bitcoin and Ether as commodities, and asked for a permanent ban for Zhao and his companies. It alleges there is a long-running pattern of undisclosed conflicts of interest and illegal activity, saying Zhao and Binance’s former Chief Compliance Officer, Samuel Lim, were aware of regulatory failings.
Binance has taken measures to ensure legal compliance in the US, including the launch of a subsidiary, Binance.US, which offers a limited range of cryptocurrencies to users in the country. In its legal action, the CFTC Binance has taken measures to ensure legal compliance in the US, including the launch of a subsidiary, Binance.US, which offers a limited range of cryptocurrencies to users in the country.
In a statement, Binance’s CEO Zhao said the CFTC’s complaint was “unexpected and disappointing” and added that the exchange had been “working cooperatively with the CFTC for more than two years”.
While the CFTC went after the leading cryptocurrency exchange, investment bank Citi has predicted that the tokenisation of real-world assets will become the next significant use case in the crypto industry, with the market potentially reaching $4-5 trillion by 2030, showing it doesn’t believe it will slow down the industry.
In its March report, “Money, Tokens and Games,” Citi estimates that of the total tokenised assets, $1.9 trillion will be debt, $1.5 trillion from real estate, $0.7 trillion from private equity and venture capital, and between $0.5-1 trillion from securities.
Polygon Labs launches mainnet beta for Ethereum-compatible zkEVM
Over the week, Polygon Labs launched the mainnet beta of its Polygon zkEVM, an Ethereum scaling solution that significantly reduces transaction costs and increases throughput. The technology, used by major companies like Meta, Stripe, and Reddit, is now completely open-source under the AGPL v3 license, allowing developers to modify, utilize, and distribute the code.
To address the possibility of undiscovered bugs, Polygon Labs has implemented strict security measures, including a temporary security council, and a $1,000,000 bug bounty for reporting critical vulnerabilities.
Similarly, the Ethereum Foundation has, ahead of the highly-anticipated Ethereum upgrade known as Shapella, doubled the maximum bug bounty reward offered for identifying vulnerabilities on the Ethereum network to $500,000.
The upgrade’s key feature is Ethereum Improvement Proposal (EIP) 4895, which will allow for withdrawals of staked Ether on the network, a functionality that wasn’t implemented when the network merged with the Beacon Chain and transitioned to a proof-of-stake consensus.
Shapella will introduce three more enhancements to optimise gas costs for specific actions. The upgrade is coming after several stages of public testing on three testnets: Sepolia, Zhejiang, and Goerli.
Gary Gensler scheduled to appear before House Financial Services Committee
The House Financial Services Committee, which oversees the U.S. financial sector including banks, securities, and digital assets, is set to hold an oversight hearing on April 18 with the Chairman of the U.S. Securities and Exchange Commission (SEC) Gary Gensler, who is expected to discuss his approach to crypto policy.
The committee is set to seek to establish a clear and consistent framework for digital assets, and would exercise significant oversight over the SEC. Gensler’s stance on crypto has been a source of debate and concern among some lawmakers and industry players.
He has been accused of using “regulation by enforcement” to crack down on crypto projects, and some Democrats have questioned his anti-crypto attitude. Some analysts believe that the party’s hostility to crypto could hurt its chances in the 2024 election campaign.
Francisco Memoria is a content creator at CryptoCompare who’s in love with technology and focuses on helping people see the value digital currencies have. His work has been published in numerous reputable industry publications. Francisco holds various cryptocurrencies.