The Daily: eToro settles with SEC, Grayscale launches new XRP Trust, Standard Chartered predicts Bitcoin will hit new all-time high by year-end, and more

Happy Thursday! In today’s newsletter, eToro settles with the SEC for $1.5 million and scales back its US crypto offerings, Grayscale launches a new XRP trust, Standard Chartered says Bitcoin could hit new all-time highs by year-end regardless of who wins the US presidential election, and more.

Meanwhile, former FTX executive Ryan Salameh has withdrawn his appeal to overturn a seven-and-a-half-year prison sentence he received for a dispute over the investigation into his partner and former congressional candidate Michelle Bond.

Let’s get started.

eToro Settles $1.5 Million with SEC, Reduces US Crypto Supply

eToro, a global social trading and investment platform, has agreed to pay $1.5 million to settle charges brought against it by the U.S. Securities and Exchange Commission (SEC) for operating as an unregistered broker and clearing organization.

• The SEC said that although the Israel-based company allowed U.S. customers to trade cryptocurrency assets that were “offered and sold as securities,” eToro did not comply with the registration provisions of the federal securities laws.
• As part of the settlement, eToro agreed not to admit or deny the SEC’s findings, but to now only allow US users to trade Bitcoin, Bitcoin Cash, and Ether.
• eToro will stop supporting a number of other cryptocurrencies in the US and will require US clients to liquidate or transfer existing positions by March 2025, after which the positions will be liquidated along with any funds transferred to the client’s cash balance.
• “eToro has decided to comply and operate within the existing regulatory framework by removing tokens offered as investment contracts from its platform. This resolution not only strengthens investor protections, but also provides a path forward for other cryptocurrency intermediaries,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement.
• eToro CEO Yoni Asia said the agreement would have minimal impact on its global operations and that the company would resume cryptocurrency trading in the U.S. once a clear regulatory framework is in place.
• “eToro users outside the US will continue to have access to over 100 crypto assets,” he added.

Grayscale Launches New XRP Closed-End Fund, Token Up 8%

Crypto asset manager Grayscale has launched a new XRP closed-end fund, the Grayscale XRP Trust, allowing investors to invest directly in the cryptocurrency.

• The company launched an open XRP trust in 2018. However, the fund was closed in 2021 after the SEC filed a lawsuit against Ripple, claiming XRP was being sold as an unregistered security.
• “We believe the Grayscale XRP Trust provides investors with exposure to a protocol with significant real-world use cases,” said Rayhaneh Sharif-Askary, Grayscale’s Director of Product and Research. “By facilitating cross-border payments that take just seconds to complete, XRP has the potential to transform existing financial infrastructure.”
• According to The Block’s XRP price page, XRP has gained 8% in price since the announcement, and the cryptocurrency asset’s market cap has surpassed $32 billion.

Standard Chartered Says Bitcoin Price Could Hit All-Time Highs by Year-End Regardless of US Election Results

Standard Chartered’s head of cryptocurrency research, Jeff Kendrick, predicts that Bitcoin will hit new all-time highs by the end of the year regardless of the outcome of the U.S. election.

• “I think bitcoin will end the year at a new all-time high regardless of who wins the U.S. presidential election,” Kendrick said in an emailed statement. “If Trump wins, bitcoin will go to $125,000. If Harris wins, bitcoin will go to $75,000.”
• Kendrick believes regulatory changes, such as the loosening of banking rules for digital assets, will continue into 2025, and that the Bitcoin price will continue to rise regardless of who ends up in the White House.
• He said the U.S. Treasury market sentiment and the potential rebound in Bitcoin ETF inflows in October were also positive factors supporting Bitcoin’s direction.

Coinbase Launches cbBTC, a Bitcoin Alternative Wrapped on Ethereum and Base

Cryptocurrency exchange Coinbase has launched its own version of wrapped Bitcoin, cbBTC, on the Ethereum and Base networks, providing a means for the DeFi ecosystem to use the most important cryptocurrency.

• ERC-20 tokens are backed 1:1 by Bitcoin stored on Coinbase and can be used for DeFi applications such as providing liquidity and serving as collateral to borrow other assets.
• At launch, Dapps supporting Coinbase Wrapped BTC include DEXs Aerodrome and Curve, lending protocols Aave, Compound, and Morpho, as well as cross-chain swap platform DeBridge.
• Coinbase’s cbBTC will compete with Wrapped Bitcoin (WBTC). According to The Block’s WBTC price page, Wrapped Bitcoin is currently the largest tokenized Bitcoin product with a market cap of $8.9 billion.

‘Step 1 or no’: Vitalik Buterin’s take on Layer 2

Ethereum co-founder Vitalik Buterin is taking a new approach to discussing layer 2 rollups in his public communications, including blogs and talks, starting next year.

• To encourage greater decentralization in Layer 2, Buterin said that only rollups that are in “Stage 1+” will be discussed. This means that the council will need to reach a 75% consensus to redefine the proof system, and at least 26% of the council members will need to be independent from the rollup team itself.
• “It doesn’t matter if I invested or you’re my friend, it’s step 1 or bust,” Buterin said. “The era of rollups being glorious multisigs is over. The era of cryptographic trust is here.”

within the next 24 hours

• The economic calendar is quiet.
• ETHSafari continues in Kenya.

Don’t miss a beat with The Block’s daily roundup of the most impactful events happening across the digital asset ecosystem.

Disclaimer: The Block is an independent media outlet providing news, research and data. As of November 2023, Foresight Ventures is the largest investor in The Block. Foresight Ventures invests in other companies in the cryptocurrency space. Cryptocurrency exchange Bitget is an anchor LP of Foresight Ventures. The Block continues to operate independently to provide objective, influential and timely information on the cryptocurrency industry. Current financial disclosures are as follows:

© 2024 The Block. All rights reserved. This article is provided for informational purposes only. It is not provided or intended to be legal, tax, investment, financial or other advice.