SEC Can't Bully Crypto - US Supreme Court Acted
VCs & TON Token | Polymarket: 39% Biden Exits
Marco Manoppo & Karon Pangestu
July 01, 2024
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Good Morning.
The market is slightly up even after the onslaught of new legal cases from the SEC dropped on Friday. Seems like we have a lot of legal battles to be ironed out in the coming years. Stay bullish.
In Today's Email:
What Matters: SEC needs to be careful ⚖️
Product: CCIP Aggregating Bridges 🌉
Charts: Why VCs love TON, Biden on Polymarket 📉
Narratives: Bounce across the board but stay cautious.
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WHAT MATTERS
US Supreme Court Decision to Overturn “Chevron Doctrine” Might Benefit Crypto
State of play: The US Supreme Court overturned the "Chevron Deference Doctrine," a 40-year-old decision allowing federal agencies broad law interpretation authority, potentially benefiting the crypto industry.
Chevron deference is a doctrine in administrative law that requires federal courts to defer to a federal agency's interpretation (e.g., SEC) of ambiguous statutes (e.g., crypto asset classification).
Supreme Court justices voted 6-3 to overturn the doctrine, led by Chief Justice John Roberts.
Opponents of the decision argued that it gave power that should be wielded by judges to experts who work for the government.
Chief Justice John Roberts said in his opinion that “the concept of ambiguity has always evaded meaningful definition.”
Elizabeth Warren called the ruling a "power grab by the far-right to benefit the wealthy and well-connected."
Majority Whip Tom Emmer said the ruling “kneecaps the regulatory abuses of Gary Gensler and every other unchecked, unelected bureaucrat who legislates by rulemaking”
Amanda Tuminelli of DeFi Education Fund said the ruling forces exec agencies like the SEC to be more cautious in extending their regulatory reach, particularly in fast-evolving and nascent sectors like crypto.
What’s next: The ruling may pressure Congress to enact specific legislation for digital assets and emerging technologies, providing a clearer statutory basis for regulatory agencies.
Last summer, the SEC sued Binance, Binance US, and Zhao, accusing them of offering unregistered broker, trading, and clearing services in the US for unregistered digital asset securities. Similar charges were also brought against Coinbase, Kraken, and recently Consensys and MetaMask.
The new Supreme Court ruling could influence how these cases are argued and decided.
The courts will now require more precise statutory guidance rather than deferring to the SEC’s interpretation, potentially benefiting these firms and the whole crypto industry.
For builders and investors: The ruling has dismantled the SEC’s and Gensler's power to “bully” the crypto players. But, for better or for worse, crypto-specific legislation in the US is getting closer to becoming a reality.
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PRODUCT OF THE WEEK
XY Finance - CCIP Aggregating Bridges
XY Finance is a cross-chain protocol that enhances interoperability by aggregating bridges for seamless transactions.
XY offers users fast, optimal route solutions for token transfers and provides developers with advanced tools like APIs and widgets to connect to all EVM-compatible chains.
XY Finance has supported 18 chains, including BASE, Polygon zkEVM, Ethereum, Arbitrum, Optimism, BSC, and Polygon.
XY has 70,000+ monthly active users and has been trusted by 100+ onboarded partners, such as Rubic, Rango, and Era Name Services.
Other cool products:
coNFT, a multi-chain web3 utility hub.
Sphynx, a new P2E-PVP game on TON.
Kai Finance, a yield optimization platform.
BaseStake, a platform to stake ETH on Base.
TachySwap, an AMM-based decentralized exchange on Etherlink.
CHARTS OF THE WEEK
Why VCs Love the TON Token
State of play: Pantera Capital is raising funds for a second investment in the TON token after its largest-ever investment earlier this year. Turns out Pantera is not the only one, as reported by The Block:
Kingsway Capital's largest token holding is the TON token, which they began purchasing over two years ago.
Ryze Labs, previously known as Sino Global Capital, has heavily invested in the TON token.
Animoca Brands began purchasing TON tokens below $1 and continued buying as prices rose to $1, $1.50, and $2.
Galaxy Ventures' GP Will Nuelle expressed long-term bullishness on the TON token.
Investors are attracted to the TON token due to its unique integration with Telegram, which boasts nearly 930M monthly active users.
Telegram regularly outpaces its closest alternative, Signal, by 10x the monthly download amount, garnering over 36.7M in January 2024.
Meanwhile, on-chain activated wallets on TON are growing exponentially from ~1M in January to ~9.4M as of today, an 840% increase in just six months.
Ryze Labs' managing partner noted that the TON network's development into a WeChat-like ecosystem with integrated crypto features offers significant potential.
Our take: There are mixed arguments regarding TON’s actual number of active users and meaningful crypto penetration rate. Regardless, it’s definitely one chain that has a unique edge (the Telegram app) on its own that can easily makes it worth billions.
Polymarket: 39% Chance Biden Exits
State of play: On Polymarket, the likelihood of US President Joe Biden withdrawing from the upcoming presidential election reached 40% as of the time of writing.
The “yes” bet soared to its highest ever following the presidential debate between Biden and Trump.
According to BBC, concerns about President Biden's ability to serve another term worsened after the debate.
Biden’s performance, described as "flat" and "unclear," intensified these concerns.
The debate led the Democratic Party to view Biden's performance as a "liability," according to The Guardian.
Meanwhile, the price of Jeo Boden has fallen 49% in the past seven days, according to CoinGecko.
Our take: I’m looking for Gavin Newsom meme tokens.
QUICK BITES
Pudgy’s parent firm acquires Frame L2.
SEC returns S-1 forms to Ethereum ETF issuers.
Abra launches crypto treasury service for corporates.
Sony buys Amber’s Japan unit to enter the crypto market.
US Judge lets most of SEC case against Binance proceed.
Hidden Road adds major exchanges and expands BUIDL token uses.
NOTEWORTHY READS & MEME
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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.