House Committee Demands SEC Produce Records on SBF Arrest by Monday, Or Else

Lawmakers Give SEC Deadline for Sam Bankman-Fried Records

Lawmakers are clashing with a regulator over access to records about the arrest of Sam Bankman-Fried.

The House Financial Services Committee “will consider all avenues to compel” the release of documents related to the arrest from the Securities and Exchange Commission (SEC).

The chairman of the committee, Patrick McHenry, and the chairman of the Subcommittee on Oversight and Investigations, Bill Huizenga, said in a Wednesday (April 12) letter to SEC Chair Gary Gensler that Gensler has refused to provide documents relating to charges against FTX founder Sam Bankman-Fried.

“We expect the staff recommendation memo to be produced immediately and all other material gathered as a result of the narrowed scope to be produced no later than 5:00 p.m. on April 17, 2023,” they wrote in the letter. “Failure to produce the requested information could result in the Committee considering using compulsory process, if necessary, to obtain the requested information.”

CFTC Chief Says Binance Intentionally Flouted US Regulations

The head of Commodity Futures Trading Commission admonished Binance Holdings Ltd over its compliance with US rules after the derivatives regulator sued the crypto exchange and its chief executive last month for a litany of alleged violations.

“These are not unsophisticated individuals,” CFTC Chairman Rostin Behnam said Thursday at an event hosted by Princeton University. “They are starting large companies and offering futures contracts and derivatives to US customers.”

Fuel Cell Company Hit with Supply Chain-Related Securities Suits 

In the current economic environment, companies are wrestling with a host of macroeconomic issues, including rising interest rates, economic inflation, continuing labor shortages, and the war in Ukraine. In addition, another issue companies are facing in the wake of the pandemic is supply chain disruption, which continues to challenge some companies. In the latest sign of ways in which these macro factors can translate into securities litigation, earlier this week the fuel cell company Plug Power was hit with a securities class action lawsuit after its share price declined following the company’s announcement of disappointing financial results driven in part by supply chain issues. A copy of the April 12, 2023, complaint filed against Plug Power can be found here.

Twitter Gets Into the Stock BusinessI said above that there are some compliance issues with that button, but that is the real beauty of this idea:

–Elon Musk generally seems a bit aggressive on compliance matters, and in particular he does not care at all about securities law compliance. “I want to be clear. I do not respect the SEC. I do not respect them,” he once said, on television, and that’s one of the nicer things he has said about the US Securities and Exchange Commission. If Elon Musk tells Twitter’s engineers “put a button on the site that lets people buy stock in companies that I tweet about, or in companies that have names that are similar to words that I tweet,” and a lawyer pipes up to say “the SEC might have some concerns about that,” he will scream expletives and tell them to make the button bigger. This is not how the leaders of most retail stock brokerages think about their relationship with the SEC, and it gives Musk certain, uh, competitive advantages.

–The SEC has been burned before and seems to be afraid to enforce securities laws against Musk?

I think a lot of people could offer a more seamless and convenient retail stock trading experience if they did not care about, and were not subject to, securities regulation. Why not Twitter?

Also, everything I said above, but 10 times more so, for trading crypto on Twitter….

NFT.NYC events head to dive bars, apartment buildings as crypto crashes

NFT.NYC – a yearly crypto confab which even last year had displayed the decadence of a sector worth trillions – took a decidedly downmarket turn this week.

Since its inaugural run in 2019, purveyors of so-called NFTs, or non-fungible tokens, have spent millions on splashy events. They have hired celebrity DJs like Diplo and rented out pricey venues like the trendy downtown club Tao, the Dream Hotel’s rooftop PHD and the members-only club Spring Place.

This week, NFT.NYC – held Wednesday through Friday – has been more of a low-budget affair. Most events had multiple sponsors to share the cost and some events were held in free or inexpensive venues – like common space in apartment buildings or dive bars.

Ex-SPACs Face Hellish Battle to Avoid the Abyss

Once, hurrying to join the stock market by merging with a listed special purpose acquisition company seemed like a good way to raise heaps of cash and for insiders to get rich. But SPACs have become a poisoned chalice, above all for the retail investors who went along for the ride.

Ex-SPACs still standing are having to adopt a variety of ugly financial contortions to keep the lights on, including merging with a special purpose acquisition company for a second time.

For those unable to quickly become profitable or find a buyer, the path to salvation is narrow; external funding is often only available on very onerous terms, if at all.

Coinbase Unveils Listing Roadmap in a Bid to Promote Transparency

In an effort to enhance transparency and reduce insider trading, Coinbase, a leading cryptocurrency exchange, has introduced a comprehensive roadmap outlining its plans for new asset listings. This move is part of the exchange’s ongoing strategy to expand its range of tradable assets and to serve as a bridge between retail customers and Web3 technology.

Coinbase’s roadmap seeks to provide transparent information about the exchange’s listing procedure, thereby mitigating the risk of insider trading. The issue of insider trading, where privileged individuals exploit non-public information for personal gain, is prevalent in both traditional financial markets and the cryptocurrency space.