New Sheriff in Town

1️⃣ Atkins Appointment

The United States Senate has narrowly confirmed the nomination of Paul Atkins for a five-year term as chair of the SEC, the regulatory agency that was established to protect investors and ensure trust in the financial system.

Widely regarded to be a “pro-crypto” pick by President Trump, Atkins is a career regulator who began service at the SEC in 1990 and worked in various federal government roles until 2017, after which he founded a consulting firm to advise both traditional and crypto companies on financial regulatory compliance.

Atkins previously criticized the lack of clear rules surrounding cryptocurrency as a "fundamental underlying issue" for regulators to address, and it is expected that his SEC will imminently provide guidance on the ambiguous intersection between digital assets and securities laws.

Who is Future SEC Chair Paul Atkins? on Bankless

Trump has nominated Atkins to replace Gary Gensler in leading the SEC. Will he be good for crypto?

BanklessJack Inabinet Dec 4, 2024 • 3 min read

2️⃣ Synthetix Depeg Deepens

Synthetix USD (sUSD) is experiencing its worst depeg event since September 2021. The stablecoin plunged to lows of $0.835 late Thursday amid tariff-induced volatility, compounding on its persistently steepening discount since the end of March.

The recently launched Synthetix “420 Pool” has been blamed for the drop; it lowered the collateralization ratio required to mint sUSD to 200% for SNX stakers, forgave $60M in staker debts, and – most importantly – eliminated liquidation risk for stakers.

While Synthetix founder Kain Warwick insists that sUSD remains overcollateralized and has rejected all notions of an impending death spiral, onchain liquidity pools have become heavily weighted towards sUSD in recent days. The stablecoin’s value risks falling further should SNX prices continue to decline.

3️⃣ Bankers Want Cuts

Bond yields have been soaring since the April 6 stock market bottom, with the brunt of the move having been disproportionately borne by the long end. Yields on the U.S. 30 Year Treasury, for example, threatened to break cycle highs after briefly surged above 5% during Wednesday’s Asian trading session.

In JP Morgan’s earnings call Friday morning, CEO Jamie Dimon said he expects “a kerfuffle” in the US Treasury market to prompt Federal Reserve intervention once “they start to panic a little bit.” Seemingly mirroring concern for the value of long bonds, in an interview with CNBC’s “Squawk on the Street” early Friday, BlackRock CEO Larry Fink indicated the market continues to underestimate the probability of future inflation, particularly when factoring in the potential impact of tariffs.

Both Dimon and Fink have indicated they expect an American recession in recent weeks, and while extremely elevated inflationary fears are plainly visible in the most recent University of Michigan consumer survey, both consumer and producer inflation metrics came in negative and below expectations on a month-to-month basis for March.

4️⃣ Ripple to Acquire Hidden Road

On Tuesday, XRP ecosystem services provider Ripple Labs announced a $1.25B agreement to acquire prime brokerage firm Hidden Road. As a prime broker, Hidden Road offers a full suite of services for institutional-grade investors, providing access to both digital and traditional asset trading, as well as financing solutions.

According to a press release about the deal, Hidden Road is one of the fastest-growing prime brokerages in the world, clearing $3T in annual trading volume across markets for more than 300 institutional customers.

Ripple’s acquisition is expected to “inject billions of dollars of capital to provide immediate scale and satisfy the demand for Hidden Road’s prime brokerage,” meanwhile, Hidden Road has committed to migrating “post-trade” activity onto the XRP Ledger and leveraging Ripple’s USD stablecoin (RLUSD) as trading collateral.

5️⃣ Ether ETF Options Approved

After nearly nine months of spot Ethereum ETF trading activity on American stock exchanges, the SEC has finally given the green light to listed options (i.e.; calls and puts). In a release published April 9, the SEC granted “accelerated approval” to permit options for BlackRock’s iShares Ethereum Trust (ETHA) – the second-largest spot ETH ETF by assets under management behind Grayscale’s legacy ETHE.

The approval of spot Ether ETF options is expected to unlock a slew of exotic exchange-traded funds that intend to improve upon ETH price performance, like income-generating covered call overwriting ETFs and downside-protected buffer ETFs.