Crypto: ‘Blockchain is hype’ – MPs warned

Jun 30, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

Today we have two videos from my coverage of FIA’s IDX in London, which I conducted in the Eurex branded lounge area outside The Brewery’s doors. The first is with FIA Europe Head Bruce Savage, whom I literally asked two questions, but really just one. The first was the obligatory, “What is it like to be back together at IDX?” and the second was the real question of “What are your top agenda items?” From there Savage just took off and ran; no more questions were necessary.

The second interview is with FIA Tech’s Andrew Castello, who is all about reference data. I learned more about reference data from Castello than I thought possible.

Former JLN staffer Doug Ashburn has a new boss at Britannica, as The Britannica Group, which publishes the Encyclopedia Britannica and many other information and instructional products under the Britannica and Merriam-Webster brands, today announced the appointment of veteran Washington Post editor Tracy Grant to the position of editor-in-chief.

BMLL Technologies is holding a webinar titled “Staying ahead of the curve: understanding the LIBOR transition through Level 3 Data” and has Dr Elliot Banks, the chief product officer at BMLL, speaking with Eris Innovations CEO Michael Riddle about “the LIBOR to SOFR transition, and how order book data and analytics can help traders manage risk amidst changing liquidity.” You can register HERE.

There is another Post story about the train crash and the Boy Scout, this one from the Washington Post rather than the New York Post. Each time I read about this story in which four people were killed and 100 injured, I appreciate more what this Scout did and the forethought and courage all the Scouts had. The Scout they highlight, Eli Skrypczak, made more than 100 trips between firetrucks and the crash site to resupply paramedics, according to the story. Just amazing.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL


FIA Europe Head Bruce Savage’s One-Question IDX Interview

Bruce Savage helped Walt Lukken host his first June IDX and was pleased to see so many people show up and participate. The head of FIA Europe, Savage was interviewed by John Lothian News outside The Brewery, where FIA’s IDX conference was being held.

Watch the video »


FIA Tech’s Andrew Castello Talks Reference Data, Symbology at IDX

John Lothian News interviewed FIA Tech’s Head of Reference Data Andrew Castello at IDX in London about his role at the firm he joined in 2019.

Watch the video »


Britannica Names Tracy Grant Editor-in-Chief
PR Newswire
The Britannica Group, which publishes the Encyclopaedia Britannica and many other information and instructional products under the Britannica and Merriam-Webster brands, today announced the appointment of veteran Washington Post editor Tracy Grant to the position of editor-in-chief. As the company’s top editor, Grant will supervise Britannica’s editorial and media staff and oversee the expansion and maintenance of multiple information and media databases for lifelong and K-16 learners worldwide. She’ll work closely with Britannica’s technology, instructional, product development, and marketing teams on the creation of new products and services.

****** At least Doug Ashburn’s new boss is not Lou Grant.~JJL


Historic Organic Soybean Option Contract Executed via the Stable-Mercaris Partnership; World’s First Organic Soybean Price Hedge Emerges from Collaboration of Stables’ Risk Management Tools with Mercaris’ Organic and Non-GMO Price Indices
Today Stable announces the execution of the first ever over-the-counter option contract to protect against volatile organic soybean prices. According to price reporting from Mercaris, organic soybeans have increased 62% compared to just one year ago. This historic volatility has heightened the need to protect against downside and upside price changes. The first organic soybean transaction contract will be settled using the Mercaris Midwest Organic Soybean Price Index, which reflects organic soybean cash market prices across a six state region of the U.S. where the majority of organic soybeans are grown.

****** I don’t remember any organic option trade before. History is being made by Stable.~JJL


Griffin blows nearly $418 per vote for Irvin’s doomed campaign for governor — worst political investment in Illinois history; Richard Uihlein, another billionaire GOP megadonor, saw much better returns for his buy-in to state Sen. Darren Bailey’s winning campaign, at a rate of about $38 per vote.
Mitchell Armentrout – Chicago Sun Times
As a billionaire hedge fund titan, Ken Griffin has certainly taken some losses while amassing Illinois’ largest fortune, but he’s probably not used to the massive hit he took on election night. Griffin poured $50 million into Aurora Mayor Richard Irvin’s campaign, only to see his pick for the Republican nomination for governor finish a distant third Tuesday at a cost of more than $400 per vote — the worst political investment in Illinois history, according to a Sun-Times analysis.

***** Darn, my vote costs $419. So close.~JJL


Wednesday’s Top Three
Our top story Wednesday was Business Insider’s A hedge fund manager who moved to Miami from Chicago breaks down the pros and cons of living in the Magic City for employees of Ken Griffin’s Citadel — from food to crime to the weather. Second was Artificial Intelligence and Its Role in Portfolio Management, a video series from AlphaMaven. Third was a tie between another Ken Griffin story, Citadel’s Ken Griffin Loses $50 Million Bet in Billionaire Bout for Illinois Governorship, from The Wall Street Journal, and the ICE press release ICE Promotes New Leaders at Futures Exchanges.


MarketsWiki Stats
26,886 pages; 239,190 edits
MarketsWiki Statistics


Lead Stories

Crypto: ‘Blockchain is hype’ – MPs warned
Brian McGleenon – Yahoo! Finance UK
Blockchain technology has been damned as nothing but hype and devoid of any meaningful use case at a select committee meeting in Westminster. On Wednesday UK MPs met in Portcullis House near the Houses of Parliament and questioned various experts on the utility of blockchain technology. The policymakers demanded examples of blockchain’s effectiveness in solving problems in different parts of the world and sought to know what the UK could learn from this innovation.

Did Razzlekhan and Dutch Pull Off History’s Biggest Crypto Heist? The novelty rapper and her startup-guy husband are now facing trial, but some of the proceeds from the $8 billion Bitfinex hack still haven’t been recovered.
Zeke Faux – Bloomberg
The hackers had been inside the Bitfinex servers for weeks before attempting the heist. They’d watched users on the cryptocurrency exchange buy and sell Bitcoins. They’d studied the commands that controlled the security system. It was as if they were hiding in an air duct above a bank’s vault, watching as tellers meticulously moved cash in and out, looking for vulnerabilities.

Treasury market reforms draw flak from funds and high-speed traders; SEC proposal requiring dealer registration would increase capital requirements and scrutiny
Kate Duguid – FT
Some of the world’s largest high-frequency traders, funds and cryptocurrency advocates are pushing back against reforms to the $23tn US Treasury bond market that they say will hit the wrong targets and curb trading. Citadel, Two Sigma, Virtu Financial and T Rowe Price are among those sounding the alarm on the sweeping scope of the rules proposed by the US Securities and Exchange Commission. The standards are intended to cover the high-speed traders and hedge funds that are crucial participants in one of the world’s most important markets, because it sets the borrowing costs for securities worldwide.

Shiploads of Russian Grain and Good Weather Temper Wheat Crisis; Russia has kept grain exports flowing, even as it blockades Ukrainian ports and seizes farmland
Yusuf Khan and Will Horner – WSJ
Fine farm weather and a rush of Russian grain ships through the Black Sea have taken the sting out of global wheat prices, a welcome sign for vulnerable countries struggling with surging food costs. The right mix of sun and rain in the U.S., Europe and Australia has raised hopes that end-of-summer harvests will be plentiful. That should help balance the sizable quantities of Ukrainian wheat stranded in the country by fighting and a Russian naval blockade.

UBS to Pay $25 Million to Settle SEC Fraud Charges Over Complex Options Products; Swiss bank sold the Yield Enhancement Strategy to around 600 investors as relatively low risk
Margot Patrick – WSJ
UBS UBS -2.78%? Group AG agreed to pay $25 million to settle fraud charges from the Securities and Exchange Commission over a complex options-trading strategy that lost customers tens of millions of dollars.

New York Finance Regulator Bullish on Crypto Despite Market’s Decline; Adrienne Harris, superintendent of the New York State Department of Financial Services, says her agency will continue its ‘leadership…in virtual currency’
Richard Vanderford – WSJ
The head of the New York State Department of Financial Services said she wants the regulator to continue to be a leader in cryptocurrencies, remaining upbeat on virtual assets despite the industry’s turmoil. The regulator has issued more cryptocurrency-related licenses so far in 2022 than it did in all of 2021, its superintendent, Adrienne Harris, said Wednesday at a New York conference hosted by the Association of Certified Anti-Money Laundering Specialists, or ACAMS.

Crypto Warning From Within: Billionaire Says More Bad News Ahead; The crypto industry is currently undergoing a truth test that will determine which projects are viable
Luc Olinga – The Street
The list of damage is growing every day. The crypto market has lost more than $2.1 trillion since its November high, according to data from the firm CoinGecko. Bitcoin, the most popular digital currency, is down 71% to $20,086.93 from its Nov. 10 all-time high of $69,044.77. Ether, the Ethereum platform token and second largest cryptocurrency by market value, is down 76.8% to $1,129.75 from its November all-time high of $4,878.26.

FSInsight Accuses Three Arrows Capital of Running a ‘Madoff-Style Ponzi Scheme’
Will Canny – CoinDesk
The crypto industry was “brought to its knees” in recent weeks by an “old-fashioned Madoff-style Ponzi scheme” wrapped in a trade that was similar to the positions that sunk Long Term Capital Management (LTCM),” research firm FSInsight said in a report Friday that looked at the implications of the implosion of crypto hedge fund Three Arrows Capital, which is also known as 3AC. Madoff in this scenario would be the founders of 3AC, Su Zhu and Kyle Davies, who used their reputation to “recklessly borrow from just about every institutional lender in the business,” resulting in pain for some high-profile firms in the industry, including Voyager Digital, Babel Finance and BlockFi, Sean Farrell, head of digital asset strategy at FSInsight, wrote in the report. Bernie Madoff was an American financier who ran the largest Ponzi scheme in U.S. history.

Credit Suisse Reveals Where It Went Wrong; The Swiss bank’s deep dive into risk and compliance work contains tacit admissions that it’s been poorly run
Paul J. Davies – Bloomberg
Handling bags of cash for a wrestler-turned-cocaine-trafficker is the kind of business you shouldn’t do as an international wealth manager. Credit Suisse Group AG’s criminal money-laundering conviction in Switzerland this week for exactly this is an embarrassment, though not a costly one with total penalties of little more than $20 million. The Swiss bank’s defense was the same as for recent revelations about dodgy clients or failures in due diligence: These are historic issues from when things were done differently. Its leaders have been telling us for some time the bank has already changed.

A Major Crypto Exchange Abandons Ethereum: Is the World’s Computer Falling Behind?
Sam Kessler and Sage D. Young – CoinDesk
Last week, crypto derivatives exchange dYdX announced that it will be leaving the Ethereum ecosystem and launching its own blockchain within the Cosmos ecosystem. According to dYdX’s founder, a new chain will allow the platform to provide the best possible experience for its users – enabling the platform to more easily customize things like fee structures and transaction speeds. The new chain will replace dYdX’s current platform built atop StarkWare, an Ethereum scaling solution platform that uses ZK-rollup technology to allow for quick and cheap transactions.

Three Arrows Reprimanded by Singapore Over False Information; Three Arrows was allowed to manage a maximum of S$250 million
A court this week ordered the crypto fund to be liquidated
Emily Nicolle – Bloomberg
Three Arrows Capital, the crypto hedge fund ordered to liquidate after failing to repay creditors, was reprimanded by the Monetary Authority of Singapore for providing false information and exceeding the maximum amount of money it was allowed to manage.

Crypto hedge fund Three Arrows falls into liquidation; Upheaval in digital asset market pushed investment group into crisis earlier this month
Scott Chipolina – FT
Crypto hedge fund Three Arrows Capital has fallen into liquidation, becoming the latest high-profile victim of the credit crisis sweeping through the digital asset market. Teneo was appointed this week as “joint liquidators” of Three Arrows through a court order in the British Virgin Islands, according to a person familiar with the matter.

China lured graduate jobseekers into digital espionage; FT investigation reveals student translators were targeted by front company for Beijing-backed hacking group APT40
Eleanor Olcott and Helen Warrell – FT
Chinese university students have been lured to work at a secretive technology company that masked the true nature of their jobs: researching western targets for spying and translating hacked documents as part of Beijing’s industrial-scale intelligence regime.

Tether’s mystery commercial paper exposure; Tweets from the stablecoin’s CTO are raising new questions about reserve quality
Bryce Elder and Kadhim Shubber – FT
The public face of crypto’s biggest stablecoin, Tether chief technology officer Paolo Ardoino, laid down the gauntlet this week to hedge funds who are shorting the $66bn market cap token. Over 12 tweets on Monday, he decried “FUD, troll armies, clowns etc” and said that Tether was “the only stablecoin that is proven with fire under extreme pressure”, referring to the $17bn in redemptions it has processed in May and June.

Grayscale Investments Suing SEC After Its Bitcoin ETF Rejected
Firm said approval would have unlocked $8 billion in value; SEC said listing proposal wouldn’t prevent market manipulation
Katherine Greifeld – Bloomberg
Grayscale Investments said it had sued the US Securities and Exchange Commission after the agency rejected a bid to convert its Bitcoin trust into an exchange-traded fund. Chief Executive Officer Michael Sonnenshein tweeted that Grayscale was suing the regulator and the company said it had filed a lawsuit in US Court of Appeals for the D.C. Circuit. The SEC on Wednesday denied the company’s application to convert its Grayscale Bitcoin Trust into the first ETF based on the world’s biggest cryptocurrency. The regulator found that the plan by NYSE Arca to list the product didn’t do enough to prevent fraud and manipulation.

Is the US the ultimate winner in derivatives trading post-Brexit? Lack of equivalence between the UK and Europe post-Brexit saw a huge chunk of derivatives trading move to the US, however, proposed upcoming regulatory changes have the potential to push some of that liquidity back across the pond.
Annabel Smith – The Trade
A huge portion of derivatives trading migrated to the US post-Brexit following the UK and Europe’s inability to reach a decision on equivalence in the derivatives trading obligation (DTO). Around 80% of volumes in ITRAXX and credit default swaps (CDS) moved over to the US post-Brexit, confirmed Deutsche Bank’s head of electronic fixed income, platform, and listed derivatives sales, Mario Muth.

Ukraine Invasion

Ukraine’s War of Attrition Exacts Heavy Toll on Both Sides; Kyiv’s strategy to make Russian forces pay dearly for ever-smaller pockets of territory risks wearing down its own military
Stephen Kalin – WSJ
With Russian shells pouring down over the Ukrainian city of Severodonetsk earlier this month, the captain called in artillery fire. “We don’t have enough,” came the response over a crackly radio. The captain, who gave his name only as Bohdan, and a dozen men had held out for two weeks, resisting an enemy with more men and more guns. Finally, with Russian tanks advancing and his unit taking heavy losses, he withdrew, leading his men 7 miles on foot through a forest to reach Ukrainian-controlled territory.

U.S. to Ramp Up Military Presence in Europe to Counter Russia; New troops and weapons are part of NATO’s response to the war in Ukraine, including the first permanent U.S. troops to Poland
Alex Leary, Tarini Parti and Gordon Lubold – WSJ
The U.S. will make its biggest military expansion in Europe since the Cold War, including its first permanent troop presence in Poland, as NATO prepares for two more members to join the alliance in response to Russia’s invasion of Ukraine. The announcement, which follows a NATO pledge this week to increase its high-readiness forces sevenfold, comes despite Washington’s efforts to shift U.S. attention toward China and offers further evidence of how Russia’s war is upending international security.

Putin Is a ‘Lunatic’ With ‘Small Man Syndrome,’ UK Defense Secretary Says
David Hughes and Sophie Wingate, The Press Association – Bloomberg
Vladimir Putin has “small man syndrome” and a “macho” view of the world, Defence Secretary Ben Wallace said. The Russian leader is a “lunatic”, the Defence Secretary also suggested. His comments came after Boris Johnson said the Russian leader’s invasion of Ukraine was an example of “toxic masculinity” and a female president would not have made the same mistake.

NATO Returns to Combat Stance to Counter a New and Hostile World; Allies agree new deployments with Sweden, Finland set to join; Russia’s war in Ukraine triggers comprehensive rethink at NATO
Natalia Drozdiak – Bloomberg
NATO this week agreed to the biggest upgrade of its military presence in Europe since the end of the Cold War, redrawing the continent’s security in response to Russia’s invasion of Ukraine. At a summit in Madrid, NATO leaders agreed to put more than 300,000 troops on high alert while beefing up its European defenses with extra forces, enhanced air power and new equipment, including two additional squadrons of US F-35 stealth fighters. After Turkey dropped its veto on Sweden and Finland’s membership applications, the alliance is also set to add two new members, bolstering the exposed Baltic nations.

Russia warns West: Don’t take your assets in our country for granted
Russia hinted on Wednesday that it had not dropped the idea of seizing Western-owned assets and businesses in the country, as a top official sharply criticised governments that have hit Moscow with sanctions. In a combative media briefing, Foreign Ministry spokesperson Maria Zakharova warned that Russia was prepared to “act accordingly” if the West decided to use Russia’s frozen state assets – chief among them being around $300 billion of central bank foreign currency reserves. The use of the funds “will be interpreted by us as an unlawful and defiantly unfriendly attack, giving us the right to take retaliatory actions to protect our interests,” she said on Wednesday.

Putin still wants most of Ukraine, war outlook grim -U.S. intelligence chief
Alexandra Alper, Karen Freifeld and Jonathan Landay – Reuters
Russian President Vladimir Putin still wants to seize most of Ukraine, but his forces are so degraded by combat that they likely can only achieve incremental gains in the near term, the top U.S. intelligence officer said Wednesday. Director of National Intelligence Avril Haines, outlining the current U.S. intelligence assessment of the more than four-month war, said that the consensus of U.S. spy agencies is that it will grind on “for an extended period of time. In short, the picture remains pretty grim and Russia’s attitude toward the West is hardening,” Haines told a Commerce Department conference.

Germany seizes three Gazprom tankers in new blow for Putin – live updates
James Warrington – The Telegraph
The German government has taken control of three liquefied natural gas ships from Russian energy giant Gazprom. US-listed Dynagas LNG Partners said Germany’s energy network regulator assumed control of three vessels “for an indefinite period of time” after Berlin took ownership of Gazprom Germania in April.

Secondary Impacts of the Conflict in Ukraine
Case Studies in the Middle East
Mercy Corps
The consequences of the war in Ukraine are being felt globally, and especially acutely in countries dependent on commodity imports and already facing long-term food insecurity and vulnerability to economic shocks. As countries across the Middle East continue to experience ongoing conflict, political instability, economic turmoil, consequences of climate change and mismanagement of natural resources along with significant humanitarian needs, they are some of the most affected by the shockwaves reverberating from the war in Ukraine.

Ukraine President Volodymyr Zelenskyy: Russia Has Become ‘A Terrorist’ State; Zelenskyy accused Russia of carrying out “daily terrorist acts” and urged Russia’s expulsion from the United Nations.
Edith M. Lederer – AP
Ukraine’s President Volodymyr Zelenskyy accused Russia on Tuesday of becoming “a terrorist” state carrying out “daily terrorist acts” and urged Russia’s expulsion from the United Nations. In a virtual address to the U.N. Security Council, Zelenskyy urged the U.N. to establish an international tribunal to investigate “the actions of Russian occupiers on Ukrainian soil” and to hold the country accountable.

Russia Pulls Troops Off Snake Island After Ukraine Strikes; Ukraine said its forces drove Russian troops from Snake Island; Kyiv dismisses Russian claims move was goodwill gesture
Bloomberg News
Russia confirmed it withdrew troops from Ukraine’s Snake Island in the Black Sea after the Ukrainian military said it had driven them out under massive attack.

Exchanges, OTC and Clearing

ICE promotes Chris Rhodes to run ICE Futures Europe
Luke Jeffs – FOW
Intercontinental Exchange has appointed Chris Rhodes as the new head of its European exchange, replacing former president of ICE Futures Europe Stuart Williams who has been promoted to group chief operating officer.
Rhodes, who was latterly the chief operating officer of ICE’s European clearing house, will become on July 1 president of ICE Futures Europe, the London-based futures and options exchange.

HKEX names group treasurer
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Thursday) the appointment of Mr Kian Hoe Tan as Managing Director and Head of Treasury.

Astana International Exchange presents new exchange-traded notes listed on the trading floor – iX China Equities BR with shares of iShares MSCI China A ETF as the underlying asset
Astana International Exchange
The issuer of the ETNs, which reflect the performance of major Chinese companies, is the special purpose company iX China Equities SPC Limited. Its only assets are shares of one of the largest exchange-traded investment funds, the iShares MSCI China A ETF, which provides access to the performance of the stock market in China. The new exchange-traded notes can become an effective financial instrument for portfolio diversification.

Foresight and fortune: Hong Kong stock exchange thrives on 25 years of China-driven success as CEO Aguzin writes the next chapter
The HKEX has recorded impressive growth since the historic handover, based on nine yardsticks compiled by the Post; Early market stewards, including former chairman Edgar Cheng, recall key turning points from 1997-2000 that led to its transformation and success
Enoch Yiu – South China Morning Post
In the 25 years since the handover, Hong Kong has strengthened its role as Asia’s premier financial hub, outgunning regional peers to become the top venue for global stock offerings and the busiest market outside mainland China and Japan.
The value of 2,573 companies listed in the city has grown 12 times to HK$38.9 trillion (US$5 trillion) since 1997, while the average daily stock turnover has multiplied 10 times in the span. In nine yardsticks compiled by the Post, growth has compounded at impressive rates in terms of fresh capital raised and public investor participation.

Sebi permits FPIs to deal in exchange-traded commodity derivatives
Indian regulators have been cautious in allowing FPIs in the commodities market on fears that sudden outflows by them may disrupt the market
Samie Modak – Business Standard
The Securities and Exchange Board of India’s (Sebi’s) board on Wednesday allowed foreign portfolio investors (FPIs) to trade in exchange-traded commodity derivatives. The move, it said, “will enhance liquidity and market depth, as well as promote efficient price discovery.”
Overseas investors will only be allowed to deal in non-agricultural commodity derivatives and only cash-settled contracts. The three broad non-agri commodities where derivatives contracts are available on domestic bourses are bullion, energy, and base metals.

UPDATE: OTC IRS Production Advisory – Support for Flexible Fixing Date Offset (Lookback)
CME Group
Please be advised CME now supports flexible fixing date offset for overnight index swaps (OIS) in the production environment from today, Wednesday June 29, 2022. This interest rate swap convention is also known as a “Lookback”, where the rate for each business day in a calculation period is determined based on the rate observed for a certain number of business days prior to such date. This enhancement allows the OIS floating coupon to be known ahead of the calculation period end date.

EEX Press Release – Fonterra, NZX and EEX confirm GDT strategic partnership
Fonterra today confirms the finalisation of the strategic partnership with New Zealand’s Exchange (NZX) and the European Energy Exchange (EEX) to each take ownership stakes in Global Dairy Trade (GDT) alongside the Co-op.

Eurex Exchange Readiness Newsflash | Transaction Size Limits (TSL) – Updates regarding TSL in T7 Production
Dear Eurex Participants,
We would like to draw your attention to some updates regarding the Transaction Size Limits (TSL). With effect from 4 July 2022, Eurex will increase the number of available User Groups as well as the number of Exception TSLs (ETSL) for the new TSL regime which will be enforced as of 25 July 2022. With this change, Eurex follows member feedback to simplify the migration to the new TSL regime.

Compliance Bulletin (Issue No. 4) – Block Trade Execution and Large Open
Position (“LOP”) Reporting Procedures for Derivatives Holiday Trading
As part of our continuous efforts to promote transparency and a culture of compliance in our
marketplace, the Exchange has prepared this Compliance Bulletin to offer the industry a better
understanding of our enforcement work and regulatory expectations. It includes some common
deficiencies and related issues identified and good practices observed, covering (1) issues on block trade execution, as well as (2) LOP reporting procedures for derivatives holiday trading.

Derivatives Holiday Trading Days (Finalized) for the First Half of 2023
Osaka Exchange, Inc. (OSE) and Tokyo Commodity Exchange, Inc. (TOCOM) are currently preparing to introduce derivatives holiday trading starting from September 2022 in perspective of further convenience for investors through provision of hedging opportunities during national holidays, thereby strengthening the competitiveness of Japan’s derivatives markets.
We today announce the finalized derivatives holiday trading days for the first half of 2023 as follows. (The finalized dates for the second half of the next year shall be announced in December.)

Finuslug clients received the first payments on national bonds of subjects of the Russian Federation
The Ministry of Finance of the Kaliningrad Region in the first half of 2022 made the first coupon payments on the people’s bonds of the region, placed through the Finuslugi personal finance platform. Clients of Finuslug received an income of about 1.2 million rubles.


AWS Direct Connect adds support for all AWS Local Zones in the United States
Amazon Web Services
Today, AWS announced AWS Direct Connect support for all AWS Local Zones in the United States. Your network traffic now takes the shortest path between Direct Connect point of presence (PoP) locations and AWS resources running in Local Zones. This feature reduces the distance network traffic must travel, decreasing latency and helping make applications more responsive.

Chicago fintech firm Amount lays off more than 100; The company confirmed it cut 18% of its staff as it girds for potential economic turbulence.
Steve Daniels – Crain’s Chicago Business
Chicago-based fintech company Amount is laying off 18% of its staff—more than 100 workers—about a month after raising $40 million in fresh equity. Amount, which provides tech support for banks and other financial companies lending over the internet to consumers, employed about 600 as of February. More than half of those were in Chicago, so the cutbacks could well exceed 60 locally. The firm raised $36 million in a new equity round last month and kept its valuation just exceeding $1 billion. Amount sought to raise $40 million, but still is hunting for the remaining $4 million, CEO Adam Hughes said today. The new fundraising effort was somewhat of a surprise, since Amount had raised $100 million last year in a round that first lifted the valuation past $1 billion.

Société Générale Is The Latest Global Bank To Join Broadridge’s Distributed Ledger Repo Platform
Leveraging the latest technology to further transform its capital market operations, Société Générale, is now live on the distributed ledger technology repo platform (DLR) created by global Fintech leader, Broadridge Financial Solutions, Inc. (NYSE:BR). The blockchain-enabled platform accelerates the digitization of the global repo market, empowering participants to realize immediate benefits of reduced risk and operational costs and enhanced liquidity. Société Générale’s active engagement accelerates the expansion of DLR’s participant network and builds on the platform’s early success. “We are excited to leverage the operational efficiencies, benefit from real time visibility and have access to enhanced liquidity that Broadridge’s distributed ledger repo platform provides,” said Greg Zielinski, Chief Operating Officer, Société Générale Americas. “This partnership with Broadridge reinforces Société Générale’s overall strategy by leveraging blockchain technology to reduce and improve efficiency in the financial markets – particularly the $10T global bilateral repo market.”

iTrustCapital Launches Conditional Transactions Feature
iTrustCapital, awarded best crypto investment platform*, recently introduced Conditional Transactions as an added feature for its users. Conditional Transactions allow clients to set price conditions above or below current market prices under which a market order will be executed to enter/exit positions automatically if an asset reaches the desired market price. Conditional Transactions on the iTrustCapital platform offer users the ability to execute transactions automatically when price parameters are met.

Zoom Bets on Corporate Customers to Stem Post-Pandemic Crash; Videoconferencing company focuses on enterprise market after consumer boom fades
Brody Ford – Bloomberg
Zoom Video Communications Inc. is navigating life after the pandemic by acting like the past two years never happened. As the world shut down in 2020, its corporate videoconferencing app became a household name, delivering quarter after quarter of triple-digit growth in part by attracting millions of regular people and small businesses. Zoom seemed destined to become a consumer tech titan.


Cybersecurity startups, once the VC darling, hammered by layoffs
Carly Page – TechCrunch
On the face of it, the cybersecurity sector is doing just fine. Demand for cybersecurity products remains high as cyberattacks continue to blight both public and private-sector businesses, and investor enthusiasm for all things cyber-related remains strong.
But while many expect the cybersecurity industry to weather the current economic storm better than most, not least due to the number of high-profile ransomware attacks and data breaches we’re seeing each week, the sector is far from immune from the mass layoffs that are impacting every corner of the technology industry. Layoffs tracker says almost 13,000 tech workers lost their jobs in June alone, compared to about 2,500 this time last year.

SEC Proposes New Cybersecurity Rules for Public Companies
Jennifer Gregory – SecurityIntelligence
Keeping up with federal regulations is an inevitable part of cybersecurity. While new rules aim to protect business, they also require more work. The U.S. Securities and Exchange Commission (SEC) recently proposed new rules that public companies will need to know. These standardize event reporting and require periodic reporting about cybersecurity policies and procedures. What do they say? How will they affect your business?

Cybersecurity leaders are anticipating mass resignations within the year – here’s why
Pallavi Kenkare – ZDNet
Four in 10 UK cyber leaders say stress could push them to leave their job within the next year, according to a new study. Combined with the ongoing skills crisis, mass resignations could leave many sectors in a precarious situation.
Cybersecurity services company Bridewell surveyed 521 critical national infrastructure decision makers across multiple sectors, finding that 95% are experiencing factors that would make them likely to leave in the next 12 months. These leaders overwhelmingly attributed their desire to leave their position to two dominant causes: 42% say a cyber breach is inevitable and do not want it to tarnish their career, and 40% say stress and burnout are heavily impacting their personal lives.

North Korea may be behind new $100 million cryptocurrency hack, experts say
Josh Smith – Reuters
North Korean hackers are most likely behind an attack last week that stole as much as $100 million in cryptocurrency from a U.S. company, three digital investigative firms have concluded. The cryptoassets were stolen on June 23 from Horizon Bridge, a service operated by the Harmony blockchain that allows assets to be transferred to other blockchains. Since then, activity by the hackers suggests they may be linked to North Korea, which experts say is among the most prolific cyber attackers. U.N. sanctions monitors says Pyongyang uses the stolen funds to support its nuclear and missile programmes.


Despite Crypto’s Considerable Volatility, Venture Capital Wants In; The recent upheavals in crypto markets haven’t deterred Silicon Valley’s venture capitalists from making big bets on the industry
Victoria Vergolina – Bloomberg
California’s Silicon Valley is both a place and a philosophy. It’s hailed as *the* place for US tech startups to get funding and attract talent. VCs, or venture capitalists, are integral to this mythology. These are the people who provide the private capital – billions of dollars worth – so tech startups can chase the next big thing. Despite the volatile crypto market, some of those VCs are still betting big on the potential of the blockchain. Bloomberg reporter Hannah Miller joins this episode for a look at how crypto is influencing VC—and vice versa.

‘Crypto Dad’ Chris Giancarlo Knighted by French Government
Jesse Hamilton – CoinDesk
The pen of a regulator may be mightier than the sword, J. Christopher Giancarlo has shown by stepping into the ranks of French knighthood in part for his support of cryptocurrencies. Giancarlo, who once ran the U.S. Commodity Futures Trading Commission and wrote the book “CryptoDad: The Fight for the Future of Money,” has been appointed as a chevalier – French for “knight” – in the National Order of Merit, with the Monday ceremony noting his crypto background. “This honor reflects the French authorities’ great respect for your understanding of financial markets and the potentials of crypto finance,” according to a letter sent to Giancarlo from the French ambassador to the U.S., Philippe Étienne, who presided over the ceremony at the diplomat’s Washington residence.

Crypto Crash Exposes Robinhood and Coinbase To Predators
Rob Lenihan – The Street
It was the Summer of Love for cryptocurrency. On June 29, 2021, Coinbase Global (COIN) – Get Coinbase Global Inc Report and Voyager Digital (VYGVF) – Get Voyager Digital Ltd Report both had their market debuts. Don’t miss the next big investment opportunity! Save on TheStreet Smarts during our Fourth of July Sale! Coinbase shares soared on that first day and finished at $328.28, well above the reference price of $250 set the previous night. Voyager Digital shares ended at $16.60.

Why This Crypto Crash Is Different
Frances Coppola – CoinDesk
The decentralized finance (DeFi)/centralized finance (CeFi) bubble is bursting, the non-fungible token (NFT) craze is burning itself out, algorithmic stablecoins are collapsing and crypto lenders are going bust. Crypto is in a bear market. Inevitably, crypto skeptics are calling “the end of crypto.” But we’ve seen this kind of correction before. Several times, in fact. In 2014, bitcoin’s price crashed when the Mt. Gox exchange collapsed. And in 2018, bitcoin’s price fell 80% as hundreds of “initial coin offerings” (ICOs) crashed and burned. In both cases, the market eventually recovered, and crypto prices rose higher than before.

FTX would need to offer a ‘material premium’ to buy Robinhood: Analyst
Emily McCormick – Yahoo! Finance
There’s a high bar that would need to be cleared for a Robinhood (HOOD) buyout, even after the stock’s year-to-date slump, according to one analyst. “Financially they’re not in trouble,” JMP Securities analyst Devin Ryan told Yahoo Finance Live on Tuesday. “[Robinhood has] $6 billion in cash, and they’re not really burning much cash.” In Ryan’s view, if a deal were to occur, it would likely have to be at a price tag well above Robinhood’s current market capitalization of nearly $8 billion. “One point that is a key aspect here for FTX or for anyone, is that Robinhood’s founders have voting rights that give them 10-to-1 on their Class B shares. So they only own 15% of the stock but they have over 60% of the voting power,” Ryan said.

Cypherpunk dumps Bitcoin and Ether to avoid more drawdowns
Pradipta Mukherjee – Forkast
Cypherpunk Holdings Inc. has liquidated all of its Bitcoin and Ethereum treasury holdings, the Canadian investment firm said on Tuesday. “In the interest of all shareholders, the company transitioned its treasury to cash,” said Moe Adham, investment chief at Cypherpunk. “This transition prepares our business to take advantage of investment opportunities we believe will become available after a substantial recapitalization of certain projects.”

Crypto Derivatives Exchange Bybit to Settle Options Contracts in USDC
Jimmy He – CoinDesk
Crypto derivatives exchange Bybit said it is offering options contract settlement using USD coin (USDC). The exchange said in a press release that USDC, a stablecoin pegged 1:1 to the United States dollar and the second largest by market capitalization, will enable stable prices for the duration of each contract. Most crypto options are margined and settled using the same currency. For example, if bitcoin (BTC) is used as collateral in a contract, it will also be used as the settlement currency. Bybit says its move to settle using USDC is a first for crypto options trading. The settlement date is the date when a trade is final, and the buyer must make payment to the seller while the seller delivers the assets to the buyer. Options contracts and other derivatives have settlement dates for trades in addition to a contract’s expiration dates. Bybit’s choice to use USDC for contracts because of its stability unfolds against a bear-market backdrop of stablecoin doubts. In May, Terra’s UST, then the third-largest stablecoin by market cap, crashed to near zero from its dollar peg. Tether (USDT), the largest stablecoin, lost $10 billion in market capitalization the same month when investors started to redeem the tokens.

Crypto Miners Face Margin Calls, Defaults as Debt Comes Due in Bear Market
Eliza Gkritsi – CoinDesk
Margin calls are coming for cryptocurrency miners as the bear market continues to claim victims. The private and publicly listed crypto miners have racked up debts anywhere between $2 billion to $4 billion to finance the construction of their gargantuan facilities across North America, according to data compiled by CoinDesk and industry participants. As the value of the miners’ output dramatically falls along with the price of bitcoin (BTC), they have to make tough decisions about how to survive – including selling off hard-earned coins and equipment.

Bitcoin Set for Biggest Quarterly Drop in More Than a Decade; Bitcoin’s 58% drop is biggest since third quarter of 2011; JPMorgan analysts say deleveraging process may end soon
oanna Ossinger – Bloomberg
Bitcoin is on track for its worst quarter in more than a decade, as more hawkish central banks and a string of high-profile crypto blowups hammer sentiment.

Accelerate Financial Launches NFT Fund, Sees Prices Bottoming
Michael Bellusci – CoinDesk
Alternative investment firm Accelerate Financial Technologies is starting a non-fungible token (NFT) fund in a bid to capitalize on longer-term growth in the Web3 ecosystem.


Whiffin’ with Griffin? Departing hedge-fund billionaire 0 for 4 in Tuesday’s contested GOP primary races; It’s unclear if Griffin will continue his heavy spending in Illinois politics after he and his Citadel hedge fund have packed up and left for Miami. But what was obvious was that his latest big bet on elections in this state was a big failure, up and down the ballot.
Dan Mihalopoulos – Chicago Sun Times
A big chunk of money from the state’s richest man could not buy much Republican primary love for conservative businessman Ken Griffin’s slate of candidates in Tuesday’s election for Illinois governor and other statewide offices. Days after announcing his family and business would leave the state for Florida, Griffin reaped a weak return on his $50 million investment in the formerly obscure mayor of Aurora, Richard Irvin. Instead, the winner in the proxy battle of right-wing billionaires was Dick Uihlein, the Lake Forest packaging magnate who was the primary source of funds for the successful campaign of state Sen. Darren Bailey in the GOP race for governor.

‘They Do Not Want Us,’ Ukraine Says of NATO as Leaders Meet
Marc Champion and Daryna Krasnolutska – Bloomberg
With one foot in the door on European Union membership, Ukraine’s leadership is feeling if anything even more bitter about NATO as the military alliance gathers in Spain for its annual summit. Ukraine is told “you are not a member because we do not want you,” President Volodymyr Zelenskiy’s Deputy Chief of Staff Ihor Zhovkva, who is responsible for foreign policy, said in an interview in Kyiv. “NATO is telling us we are not giving you anything.” The alliance’s members including the US, UK and nations across Europe have of course sent large arrays of weaponry into Ukraine to help it fight Russia’s invading forces. Those weapons have steadily grown in intensity to include more offensive arms and, this week, a pledge from the US to ship an advanced surface-to-air missile defense system. NATO states have also provided financial aid to keep the Ukrainian government operating. But the alliance as a whole, according to Zhovkva, has fallen short, and Ukraine’s expectations for Madrid are low.

Steel Plant Trump ‘Saved’ Slated to End Steelmaking Forever
Andrea Bossi and Joe Deaux – Bloomberg
U.S. Steel Corp., the nation’s third-largest steelmaker, announced it’s in talks to end production at its century-old furnaces in Illinois. Shares fell to their lowest since January. The more than 120-year-old Pittsburgh-based company plans to sell the two blast furnaces at its Granite City Works facility to SunCoke Energy for an undisclosed amount to propel the use of so-called pig iron, a raw material needed to make steel in its mini-mills. Transitioning the facility to produce the raw material from steelmaking will take until 2024 and would result in the loss of as many as 1,000 jobs, according to the company.

Crypto Becomes a Major Political Donor as Americans Head to the Polls; The digital-asset industry is joining the US political money game to woo candidates and gain influence.
Victoria Vergolina – Bloomberg
It might feel like there’s always some kind of election happening in the US – and that’s because there is. State and local elections can happen every year, while ??Congressional midterms occur every other year, allowing US voters to decide who will represent them. These elections really matter, and crypto executives are spending significant amounts of money to influence them. In 2022, for the very first time, political spending by major figures in the crypto industry has eclipsed the dollars being spent by traditional donors in Big Tech and pharma. Today, Bloomberg reporter Allyson Versprille joins this episode to share her reporting on why crypto is emerging as a significant financial force in US politics.


Rowing in unison to enhance cross-border payments – speech by Victoria Cleland; Given at the Central Bank Payments Conference 2022
Bank of England
Victoria Cleland talks about the progress of a plan to make cross-border payments cheaper, faster and more transparent. This plan is set out in a roadmap created by the G20 group of countries.

Enforcement Report highlights Canadian securities regulators’ actions to pursue wrongdoing and hold securities law violators accountable Français; Wide-ranging actions included disrupting ongoing and illegal activity and enhancing technology and analytics capabilities to tackle evolving threats and emerging trends
Canadian Securities Administrators
The Canadian Securities Administrators (CSA) today released its fiscal year 2021-2022 Enforcement Report, which outlines the specific actions that CSA members undertook in the past year to detect, disrupt and deter wrongdoing and hold securities law violators accountable.

Operational constraints see ESMA pause SI data reporting for non-equity instruments in August; Regulator has confirmed that the mandatory reporting regime will not apply from 15 August to 14 November; investment managers will also not need to perform SI tests.
Annabel Smith – The Trade
ESMA has made temporary plans to pause mandatory data reporting requirements for non-equity instruments other than bonds on systematic internalisers (SIs) in August. The regulator has been gathering data that was otherwise not easily available, on a voluntary basis, on behalf of market participants; in order to ensure they meet their transparency and best execution obligations.

CFTC Commissioner Summer Mersinger Seeks Nominations for the Energy and Environmental Markets Advisory Committee Associate Membership and Potential Discussion Topics
Commodity Futures Trading Commission Commissioner Summer K. Mersinger, sponsor of the CFTC’s Energy and Environmental Markets Advisory Committee (EEMAC), is seeking nominations for associate membership of the EEMAC and potential topics for future EEMAC meetings through a formal request for submissions in the Federal Register. The deadline for submissions is July 13, 2022.

FINRA Publishes Independent Counsel’s Report on Arbitrator Selection Process; Report Finds No Evidence of Improper Agreement to Remove Arbitrators From Cases; FINRA to Implement Recommendations to Provide Greater Transparency
FINRA today published the report of independent counsel Lowenstein Sandler LLP, which found no evidence of an improper agreement to remove certain arbitrators from arbitration cases. FINRA also said it would promptly implement the report’s recommendations to provide greater transparency to the arbitrator selection process.

The Report of the Independent Review of FINRA’s Dispute Resolution Services – Arbitrator Selection Process
In February 2022, the Audit Committee of the FINRA Board of Governors engaged Lowenstein Sandler LLP to conduct an independent review in connection with a Fulton County, Georgia Superior Court decision vacating an arbitration award in favor of respondent Wells Fargo Clearing Services, LLC. This report by Lowenstein describes the findings from its independent review.

UBS to Pay $25 Million to Settle SEC Fraud Charges Involving Complex Options Trading Strategy
The Securities and Exchange Commission today announced that UBS Financial Services Inc. has agreed to pay approximately $25 million to settle fraud charges relating to a complex investment strategy referred to as YES, or Yield Enhancement Strategy.

Denver Regional Director Kurt L. Gottschall to Leave SEC; Jason J. Burt and Thomas M. Piccone Named Acting Co-Heads of Denver Office
The Securities and Exchange Commission today announced that Kurt L. Gottschall, the Director of the Denver Regional Office since 2018, is leaving the agency after more than 22 years of service. Jason J. Burt and Thomas M. Piccone will become the office’s Co-Acting Regional Directors when Mr. Gottschall departs in early July.

Tracy S. Combs Named Director of SEC’s Salt Lake Regional Office
The Securities and Exchange Commission today announced that Tracy S. Combs has been named Director of the Salt Lake Regional Office. Tanya Beard, who has served as Acting Director since January 2022, remains as Assistant Regional Director of Enforcement.

SEC Charges Two Israeli Citizens Who Posed as a Prominent Financial Educator with Securities Fraud
The Securities and Exchange Commission today charged two Israeli citizens with defrauding investors in a scheme that involved posing as a nationally-recognized financial educator to induce investors in Latinx and Spanish-speaking communities to sell securities and use the proceeds to purchase fixed indexed annuities from them.

SEC Charges New Jersey Man with Insider Trading
The Securities and Exchange Commission today filed insider trading charges against New Jersey resident Daniel J. Moscatiello for illegally trading in advance of the September 10, 2020 public announcement that Baring Private Equity Asia had agreed to acquire Virtusa Corporation in an all-cash transaction. To settle the charges against him, Moscatiello has agreed to pay disgorgement, prejudgment interest, and civil penalties totaling more than $180,000.

ASIC consults on remaking class order on financial requirements for retail OTC derivative issuers
ASIC has today released a consultation paper proposing to remake its class order on the financial requirements for issuers of over-the-counter (OTC) derivatives to retail clients. The class order is due to expire (‘sunset’) on 1 October 2022.

Finding opportunity in a world of uncertainty
Speech by Sarah Pritchard, Executive Director, Markets, at the CityUK Annual Conference.

FCA resolves High Court proceedings in relation to unauthorised deposit taking
Mr Mohammed Kabir has agreed to orders to resolve proceedings brought by the Financial Conduct Authority (FCA) relating to an unauthorised deposit taking scheme operated by Bright Managment Solution Limited [sic] (Bright Management) which has avoided a trial that was due to start in June 2022.

Summary of Report by the Working Group on Corporate Disclosure of the Financial System Council
FSA Japan
The Working Group on Corporate Disclosure has discussed enhancing disclosure of non-financial information and improving efficiency of disclosure in light of recent changes in economic and social circumstances. The summary below is based on the discussions.

MAS Reprimands Three Arrows Capital for Providing False Information and Exceeding Assets Under Management Threshold
Monetary Authority of Singapore
The Monetary Authority of Singapore (MAS) today reprimanded Three Arrows Capital Pte. Ltd. (TAC) for providing false information to MAS and exceeding the assets under management (AUM) threshold allowed for a registered fund management company (RFMC).

Investing and Trading

A Hot Housing Market Is a Financial Crisis Risk; The longer prices defy the Fed, the harder the Fed might try to break them.
Mark Gongloff – Bloomberg
The US housing market is either the car at the end of “Thelma and Louise” or “Chitty Chitty Bang Bang” — soaring one last time before (spoiler alert) crashing into a ravine or defying the laws of physics and flying forever. As someone who has a rocky relationship with physics (I am bad at “sports” and “standing”), my natural inclination is to assume natural laws will have their cruel victory in the end. Investors should brace for just such a thing, in fact, warns John Authers. New data from S&P CoreLogic and the FHFA showed home prices continuing to rise to nosebleed heights in April, despite average mortgage rates jumping to more than 5% that month.

Markets Are Signaling a Pyrrhic Inflation Victory; Weakening economic growth has taken over as their biggest concern.
John Authers -Bloomberg
Inflation almost seems passe. The worry of the moment is now economic growth. That’s not unreasonable, as the latest update shows US gross domestic product declined at an annualized rate of 1.6% in the first quarter. With the huge exceptions of the Covid-scarred first two quarters of 2020, this was the weakest US growth since the spring of 2009:

Former Morgan Stanley electronic trading executive to lead technology efforts at Horizon; Incoming CTO joins Horizon Software from rival trading systems vendor Itiviti, recently acquired by Broadridge.
Annabel Smith – The Trade
A former Morgan Stanley electronic trading executive has joined Paris-based Horizon Software to lead its technology strategy. Olivier Masdebrieu joins Horizon as the chief technology officer (CTO) from rival trading systems vendor Itiviti.

Environmental, Social and Corporate Governance

Innovation, ESG Scores, and the Net Zero Economy
Bartley Madden & Mark Van Clieaf — Real Clear Markets
Environmental, social, and governance (ESG) scoring and disclosures have widespread support as the means to achieve zero greenhouse gas (GHG) emissions—the Global Net Zero Economy transformation. However, sustained economic and societal progress have always been driven primarily by innovation, not by keeping score. The recent SEC proposal for detailed and mandatory environmental reporting may have an unintended consequence of creating a blind eye for the kind of innovations that would actually deliver significant emission reductions.

ESG: Inside Edition
Caitlin Devitt – Bond Buyer
Hi, welcome to another Bond Buyer podcast. I’m Caitlin Devitt infrastructure reporter with the Bond Buyer. And I am here at the GFOA conference in Austin, Texas. It’s their 116th conference. So GFOA has been around for a long time. And I’m here with Barry Fick who’s the executive director of the Minnesota Higher Education Facilities Authority. He’s also a member of the GFOA’s debt committee, a very important committee which met yesterday, for a long time. We asked Barry to come be with us today because among the different many interesting things that he said, and that the debt committee talked about yesterday, one of them was about ESG and a recent bond sale that he was part of. As our listeners know ESG is all the rage and it’s a very important topic and investors are increasingly interested in it. One of the things that’s sort of interesting is does it, or does it not carry a market penalty? And we’re still kind of figuring that out. We don’t quite know. You talk to different issuers and they have different experiences. So Barry had an interesting experience. And so I was hoping you could tell us a little bit about it, but first, why don’t you tell us a little bit about yourself, how long you’ve been at the authority, how long you’ve been on the debt committee?

Investigating International Stocks With ESG Overlay
International stocks, both developed and emerging markets, have frustrated investors for years, but valuation opportunities are abound in ex-U.S. markets.
Investors can capitalize on what are now more attractive valuations owing to this year’s rocky market environment while implementing environmental, social, and governance (ESG) principles thanks to exchange traded funds such as the IQ Candriam ESG International Equity ETF (IQSI). IQSI, which turns three years old in December, follows the IQ Candriam ESG International Equity Index.

Record heat wave cooks Japan, straining power grid
Karina Tsui, Julia Mio Inuma and Ian Livingston – Washington Post
Japan’s Meteorological Agency announced the end of the rainy season in Tokyo and neighboring areas in eastern and central Japan, marking the earliest declaration since data became available in 1951. Strong, high pressure has controlled Japan’s weather since the weekend and is expected to do so for about another week — and perhaps longer.


STOXX Global Digital Entertainment and Education Index licensed for new iShares Thematic UCITS ETF
Press Releases – Qontigo
Qontigo has licensed the STOXX® Global Digital Entertainment and Education Index to BlackRock as an underlying benchmark for an iSharesETF, the latest addition to a growing range of innovative thematic solutions available to European investors. The fund was launched today.
The STOXX Global Digital Entertainment and Education Index selects companies that generate more than half of their revenues from 34 sectors associated with the targeted theme, including Educational Software, General Gaming Products and Services, Content Platforms, and Electronic Devices. The index, which uses an ‘adjusted’ equal-weighted scheme, applies liquidity and market-capitalization filters to the selection of stocks. The methodology also implements exclusionary ESG screens.

JEDI Will Battle YODA as Europe Gets Another Space-Themed ETF
Denitsa Tsekova – Bloomberg
With Star Wars as its inspiration, a second European exchange-traded fund will test the appetite for the space revolution as some of the industry’s biggest backers — like Cathie Wood — get caught in the thematic-asset bust. The competition in Europe is heating up with VanEck debuting its JEDI product this week just a year after the launch of the Procure Space UCITS ETF (ticker YODA). VanEck Space Innovators UCITS ETF (JEDI) is listed on the London Stock Exchange and Deutsche Boerse and has an expense ratio of 0.55%, according to the company. YODA, with an expense ratio of 0.75%, was the first European Space ETF and is tracking the S-Network Procure Space Index, while JEDI tracks an MVIS index. “A new space age has begun,” Martijn Rozemuller, CEO at VanEck Europe said in a statement. “Space has become a lot easier and cheaper to reach, opening up entirely new business areas.”

Deutsche Bank: Crypto Free Fall Could Continue Because of the System’s Complexity
Will Canny – CoinDesk
The free fall in crypto markets could continue because of the system’s complexity, Deutsche Bank (DB) said in a report Wednesday. Getting token prices to stabilize is difficult because there are no “common valuation models like those within the public equity system,” the bank said. In addition, the cryptocurrency market is highly fragmented, according to the report. Furthermore, speculative trades are likely to involve the simultaneous use of several coins, which increases spillover effects, the bank said. Whatever liquidity might exist in these markets could quickly evaporate, which would erode confidence in prices and increase the likelihood of contagion, it added. Macro risk is also a concern. As bitcoin (BTC) and other cryptocurrencies are speculative, high-risk assets, they are “disproportionately affected by central bank tightening,” the report said.

Citigroup’s Family Office Clients Are Seizing on the Market’s Wild Swings; Firms with over $1 billion seen making big bets in rates, FX; Citi executive also sees more money going to hedge funds
Benjamin Stupples – Bloomberg
Family offices with at least $1 billion in assets are boosting their investments amid market swings fueled by recent geopolitical and macroeconomic turbulence, a Citigroup Inc. executive said.

Wellness Exchange

Pfizer and BioNTech to Get $3.2 Billion From US in Covid Vaccine Deal
Riley Griffin – Bloomberg
The US agreed to pay vaccine partners Pfizer Inc. and BioNTech SE $3.2 billion in a deal for 105 million of their messenger RNA shots against Covid-19. The deal is for doses for adults, children and infants, and may include some shots that target the omicron variant, according to a statement from the companies. Deliveries are planned to begin as soon as late summer and continue into the fourth quarter. Payment will occur after the supply is delivered. Pfizer shares rose 0.6% after US markets closed, while BioNTech’s American depositary receipts gained 1.4%. The purchase of additional Covid supplies is the administration’s second to be announced Wednesday after agreeing to pay about $275 million for 150,000 doses of an Eli Lilly & Co. antibody therapy that remains effective for treating omicron and its subvariants. The White House has been battling Congress over funds to make such purchases.


Germany, Canada in talks over LNG terminal for export to Europe -govt official
Riham Alkousaa, Andreas Rinke and Marwa Rashad – Reuters
Germany is in talks with Canada over options to export liquefied natural gas (LNG) to Europe via a terminal on Canada’s east coast, a German government official told Reuters on Tuesday. German Chancellor Olaf Scholz discussed the issue with Canadian Prime Minister Justin Trudeau on the sidelines of the summit held by The Group of Seven economic powers (G7) leaders this week, two other sources told Reuters. Berlin has been rushing to phase out Russian energy imports after Moscow’s invasion of Ukraine and is looking for alternative supply routes and sources of energy. It has backed the construction of two LNG terminals and has rented four floating storage and regasification units (FSRUs) as a stop-gap measure.

Russia Muscles In on Indian Oil Market at Expense of OPEC Titans
Debjit Chakraborty and Julian Lee – Bloomberg
Watch out Iraq and Saudi Arabia, Russia is making huge inroads into the Indian oil market and has quite possibly become the largest supplier to the giant Asian buyer. Deprived of many of its traditional European buyers, Moscow is on course to deliver somewhere between 1 million and 1.2 million barrels a day to the world’s third-largest oil importer this month, according to tanker tracking figures compiled by Bloomberg and two oil analytics firms. That would place it neck-and-neck with, or a little above, Iraq, and far ahead of Saudi Arabia. The surge in flows will be viewed with unease by Baghdad in particular, since Iraq’s oil has increasingly had to discount to compete for market share in Asia. Refiners in India have been gorging on cheap Russian barrels in a way they never did before the invasion of Ukraine, making it noticeable even to Vladimir Putin, Russia’s president.

Germany Mulls Uniper Bailout to Stem Russian-Gas Contagion
Isis Almeida and Vanessa Dezem – Bloomberg
Germany is in talks to bail out energy giant Uniper SE to stem broader fallout from Russia’s moves to slash natural gas deliveries. Uniper, the largest buyer of Russian gas in Germany, said it’s discussing a possible increase in state-backed loans or even equity investments to secure liquidity. The crisis could also affect Finland, which controls Uniper’s parent Fortum Oyj. The utility said Uniper’s rescue requires a national effort “in Germany.”

Russia’s Surprising Economic Headache: A Strong Ruble; The Russian currency has risen 42% against the dollar this year, weakening the value of the country’s oil-and-gas revenues
Caitlin McCabe and Kate Vtorygina – WSJ
After its first default on international debt in a century amid a grinding war with Ukraine, one might expect Russia’s currency to be suffering. But Russia has the opposite problem. The Russian ruble has soared to a roughly seven-year high against the U.S. dollar—an astounding turnaround for a currency that earlier this year was in free fall after Russia invaded Ukraine.

Italy’s Drought Worsens as Salty Sea Creeps Further Into Vital River; The lack of rain has already become a disaster for crops in northern Italy and now the Adriatic sea is raising the salinity of the region’s main irrigation source.
Marco Bertacche – Bloomberg
Recent rain in Northern Italy has done little for the region’s worst drought in 70 years. At least 30% of this year’s rice crop has already been lost, and now the region’s irrigation sources are being threatened by the salty Adriatic sea, which has entered a record 30.6 kilometers (19 miles) into the Po river.

Egypt Scoops Up Wheat Supplies with Supersized Tender; Purchase of 815,000 tons is largest in at least a decade; Grain futures have declined recently amid recession concerns
Megan Durisin and Abdel Latif Wahba – Bloomberg
Egypt booked the most wheat in a tender in at least a decade, taking advantage of a recent price slump to bolster stockpiles as Russia’s invasion of Ukraine hampers global supplies. The country’s state-run buyer bought 815,000 tons on Wednesday, the largest single purchase since at least 2012, data compiled by Bloomberg show. Other nations like Saudi Arabia and Algeria have also snapped up wheat in recent days.

BT Workers Decide Whether to Stage Biggest National Walkout Since 1987; Communication Workers Union ballots more than 40,000 members; Failed talks for bigger pay rises a key concern for BT workers
Thomas Seal – Bloomberg
BT Group Plc is preparing to discover whether tens of thousands of its unionized workers will take part in the first national walkout from the company in more than three decades. The collapse of pay rise negotiations in April led the Communication Workers Union to ballot more than 40,000 members on whether to take industrial action, the results of which will be announced in London shortly after 4 p.m. on Thursday.


Newsletter Startup Substack Cuts 14% of Staff as Downturn Looms
Ellen Huet – Bloomberg
Newsletter platform Substack Inc. cut 13 jobs on Wednesday, citing a gloomy economic outlook, the company’s chief executive officer said in an email to staff. The jobs represent 14% of the startup’s workforce, according to a company spokeswoman. Substack’s digital platform allows writers to publish free or paid newsletters, and the San Francisco-based startup collects a roughly 10% cut of the paid subscriptions. The job cuts were previously reported by the New York Times. Substack CEO Chris Best said he and his two co-founders chose to eliminate the positions in order to make Substack less reliant on additional fundraising in the future, especially as a market downturn has sent technology stocks diving in recent months. Venture capital funding and deal volume have also dropped significantly in the past quarter, according to new data. “In recent weeks, the macroeconomic outlook has become increasingly uncertain, making it clear that we should be prepared for a period of challenging conditions that could last years,” Best wrote in the email.

A Boy Scout escaped Amtrak wreckage and comforted a dying truck driver; Eli Skrypczak, 15, felt ‘a giant jolt’ before his train car derailed and overturned, throwing him out of his seat
Jonathan Edwards – The Washington Post
Eli Skrypczak played on his phone Monday afternoon while aboard an Amtrak train hurtling through the heartland of Missouri. As he slipped in and out of sleep, the 15-year-old Boy Scout and more than 270 other passengers were unaware of the dump truck ahead that was about to change their lives. Eli and 14 other Boy Scouts had spent 10 days exploring the backcountry of New Mexico, mostly by backpacking through the Sangre de Cristo Mountains, and were on their way home to Appleton, Wis., said Dan Skrypczak, Eli’s father and the scoutmaster of Appleton Troop 73. Each of the Scouts was whiling away the train ride in his own way, Skrypczak told The Washington Post late Tuesday. A few had used an app on their phone to determine the train was going about 90 mph, which impressed them. Some ate in the dining car. Others took in the scenery from an observation car retrofitted with floor-to-ceiling windows. One happened to be in the bathroom.

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