The Return of Preet

Crypto firm BlockFi hires Arnold & Porter lobbyists after record SEC fine

Crypto lending platform BlockFi, which earlier this year paid a record fine to the U.S. Securities and Exchange Commission to resolve regulatory charges, is the latest company in the nascent digital currency industry to hire lobbyists.

The company has tapped a five-person policy team with law and lobbying firm Arnold & Porter Kaye Scholer, including partner Mark Epley and legislative and public policy practice group chair Kevin O’Neill, according to a federal lobbying disclosure this week.

SEC Is Investigating Goldman Sachs Over ESG Funds

The Securities and Exchange Commission is investigating Goldman Sachs Group Inc.’s asset-management arm over its funds that aim to invest based on environmental, social and governance standards, according to people familiar with the matter.

The SEC’s probe is the latest known instance of regulators’ scrutiny of ESG investing, which has been a boon for asset managers that struggled in recent years to compete with low-fee index funds.

Who Pays for Crypto’s Collapse?

But this cycle had something new: crypto craziness. The Federal Trade Commission reports that 46,000 people have reported losing $1 billion in crypto to scams since January 2021. Bitcoin is down more than 50% since its 2021 peak, Ethereum is down 65%, XRP 78%. And of course, the Luna token is down from $116 on April 5 to essentially zero. Is anyone liable? Binance, FTX, Coinbase, Kraken, Bitfinex and Crypto.com are some of the largest exchanges for crypto trading.

Class actions will follow the money. Kim Kardashian and boxer Floyd “Money” Mayweather Jr. are being sued for false statements promoting crypto. But that’s nothing! The trillion-and-a-half-dollar question is: Are cryptocurrencies securities or not? Selling unregistered securities can be a felony, with up to five years in jail, and damages could include the dollar amount of an investors’ losses or more.

EU Aims to Clinch Deal on Landmark Crypto Law This MonthThe European Union is nearing an agreement on key legislation to regulate the cryptocurrency sector that would set common rules across the 27 member states, people familiar with the matter said.

France, which currently chairs the EU, and the European Parliament are optimistic about resolving remaining issues holding up the Markets in Crypto-Assets (MiCA) package and reaching a deal this month, according to the people. Negotiators are expected to meet on June 14 and June 30.

Binance.US Accused of Misleading Investors in Class Action Lawsuit Over Terra

“Those of you waiting for the earth to become unstable- I'm afraid you will be waiting until the age of men expires.”

These confident words from Terra blockchain founder Do Kwon sought to convince crypto investors to put their trust (and money) into TerraUSD (UST), a stablecoin that Kwon promised would always stay priced at exactly $1. Unfortunately, Kwon’s confidence was not enough to save UST and the rest of the Terra as Kwon’s project dropped to zero.

Now, over 2,000 Terra investors say false marketing is what caused them to lose their money.

In a class action lawsuit filed on Monday in North California, cryptocurrency exchange Binance.US has been accused of misleading investors surrounding the Terra blockchain ecosystem.

Wall Street's Top Cop Warns on Encrypted Texts, Market FOMO

The top federal prosecutor overseeing Wall Street says big banks and hedge funds should get a handle on employees’ use of messaging services like Signal or WhatsApp, because those encrypted apps are where his people will look for evidence of criminal activity.

“If I were head of a fund, and I had folks communicating about business on encrypted channels or personal devices, I would want to know,” said Damian Williams, US attorney for the Southern District of New York. “That’s where the bomb could be that blows up the whole shop.”