Ethereum Foundation Gets SEC Scrutiny in Latest Crypto Crackdown

Mar 21, 2024

First Read

Hits & Takes
John Lothian & JLN Staff

We finally know who Satoshi Nakamoto is. It must be Elon Musk. My proof? It is a well known fact that Elon Musk has engaged in cannabis-themed, if not cannabis smoked, humor. So what does this have to do with Satoshi? Musk offered to buy Twitter for $44 million, or $54.20 per share with an emphasis on the 420. That number is associated with marijuana, and April 20, which is often considered the weed national holiday, is when Bitcoin is expected to experience its next halving event. Let’s just say perhaps the smoke is beginning to clear around Satoshi. Or, a strange coincidence has occurred.

ICE’s Gordon Bennett shared on LinkedIn the results of a survey. ICE, in collaboration with the We Mean Business Coalition and Bain & Company, conducted a survey involving 180 executives from 27 countries across various sectors, revealing corporate perspectives on the carbon credit market. The findings suggest significant growth potential in market participation and investment if obstacles are mitigated through enhanced regulatory frameworks: non-participating companies interested in entering the market would double from 22% to 50%, existing participants would boost their spending on carbon credits by up to 10% within two years, and a greater number of companies would establish both near-term (increasing from 32% to 50%) and long-term climate targets (from 37% to 56%). To download the full report, go HERE.

Options markets, originally designed for risk transfer and hedging, now reflect “FOMO Insurance” as the primary risk hedged in outperforming stocks, evident from the analysis of options “skew” in pricing data, according to a commentary from Steve Sosnick from Interactive Brokers

SIX welcomed over 44 exchanges to WFEClear 2024 in Madrid. Spanning three days, the event focused on central counterparties, regulatory hurdles, and DLT technology’s impact. Javier Hernani of SIX emphasized the company’s dedication to pioneering in the digital assets domain.

Dora and Otis are dead. Thank goodness. The WMO, or World Meteorological Organization, has retired Dora and Otis from its North Pacific hurricane names, Bloomberg reported. In October, Hurricane Otis, a Category 5 storm with 160 mph winds, struck Acapulco, Mexico, resulting in at least 51 deaths, 34 missing, and $3.2 billion in damages, making it the eastern Pacific’s strongest landfall storm, according to the WMO. The name Dora was removed from the roster not due to direct damages but due to its association with exacerbating Maui, Hawaii’s deadly wildfires in August 2023 by strengthening trade winds, leading to over 100 deaths and numerous lawsuits against Hawaiian Electric Industries Inc.

Later today we will publish the second video from our JLN Industry Leader Series sponsored by Wedbush from our FIA Boca coverage. This video is with Trading Technologies CEO Keith Todd and COO Justin Llewelyn-Jones. Look for it on JohnLothianNews.com.

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

*****

The World Happiness Report 2024, published on March 20, explores the happiness levels across various age groups, and challenges the portrayal of later stages of life as being unhappy. Collaboratively conducted by Gallup, the Oxford Wellbeing Research Centre, the UN Sustainable Development Solutions Network, and the World Happiness Report’s Editorial Board, the report provides a nuanced understanding of global happiness trends. Contrary to conventional wisdom, it reveals a changing landscape of happiness across different life stages, offering insights into the evolving nature of human well-being. Download the report HERE.~SAED

Our most read stories from our previous edition of JLN Options were:
The Latest Options Craze Resembles Past Manias. That’s Not a Good Thing from Barron’s.
Beneficial Margin Treatment for Cash-Settled Index Options from Cboe.
Options market still searching for cause of the Vix plunge from Risk.net. ~JB

Subscribe to the JLN Options Newsletter HERE (it’s free).

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John Lothian Interviews Derivative Path’s Matt Petrik on Revolutionizing Financial Markets Amidst Regulatory Changes and Technological Innovations
JohnLothianNews.com

John Lothian recently interviewed Matt Petrik of Derivative Path, who discussed his company’s foundation and evolution in response to regulations like the Volcker Rule and Dodd-Frank. Originating from a team with roots at Wells Fargo, Derivative Path has developed into a cloud-based platform that simplifies interest rate hedging, foreign exchange, and commodities trading for financial institutions, especially those with assets under $100 billion. The platform’s trade blotter integrates various market operations, enhancing visibility for both firms and their clients.

Watch the video »

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Three Takeaways from FIA Boca 2024 – The Challenges of Growth and Need for Resilience are Top Concerns
Derek Haworth – BornTec
Twelve hundred attendees, twenty countries represented, and three days of meetings: that sums up FIA Boca by the numbers. But what were the big topics of discussion and emerging trends that are shaping the industry? The BornTec team has a few ideas to share from conversations we had with customers and prospects at the futures trading industry’s biggest event of the year.
/jlne.ws/3INHK94

***** Sun, Smiles and Swag, the three Ss.~JJL

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Federal Reserve issues FOMC statement
U.S. Federal Reserve
Recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have remained strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The Committee judges that the risks to achieving its employment and inflation goals are moving into better balance. The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks.
/jlne.ws/3PunTiX

****** I love doublespeak.~JJL

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The mystery of the Hampstead mansion and the £1.4bn bitcoin haul; What were two Chinese women doing in a rented mansion in London with an astronomical amount of cryptocurrency?
Kadhim Shubber and Eri Sugiura – Financial Times
Detective Constable Joe Ryan arrived at a red-brick manor house in Hampstead, north London, early on the morning of October 31 2018. Ryan, a veteran money-laundering investigator with the Metropolitan Police, had obtained a warrant to search the property as part of an investigation into the activities of a 36-year-old woman named Jian Wen. A China-born British citizen, Wen had tried to buy a multimillion-pound property using bitcoin whose origin she couldn’t prove.
/jlne.ws/4a8Op9W

****** Another amazing story in the Bitcoin Crime Chronicles.~JJL

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Wednesday’s Top Three
Our top clicked item on Wednesday was the Introduction to Large Language Models course from Google’s ten new artificial intelligence courses that John mentioned in Hits & Takes. Second was the Google course Introduction to Generative AI. And third was the Google course Create Image Captioning Models.

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Lead Stories

Ethereum Foundation Gets SEC Scrutiny in Latest Crypto Crackdown
Gillian Tan, Allyson Versprille and Olga Kharif – Bloomberg
The US Securities and Exchange Commission has demanded information from companies about dealings with the Ethereum Foundation as part of a review of aspects of Ether – the world’s second-biggest cryptocurrency, according to people familiar with the matter. The recent SEC inquiry may represent a significant escalation by Wall Street’s main regulator in its multiyear crackdown on the crypto industry. The agency’s chair, Gary Gensler, says many digital assets are unregistered securities subject to SEC rules. He’s refused to say if Ether is part of that group. Although Gensler has avoided making a declaration about Ether’s status, he has signaled that a feature of Ethereum software could lead to Ether falling under its jurisdiction. Such a determination would trigger a rash of compliance and investor protection rules, which many in the crypto industry say are ill-suited for digital assets.
/jlne.ws/4cr5E7D

The mutual fund at 100: is it becoming obsolete? They enabled millions to invest in the stock market but newer, nimbler products are reshaping asset management
Brooke Masters and Will Schmitt, Madison Darbyshire and Harriet Agnew – Financial Times
One hundred years ago on Thursday, Edward Leffler, a former door-to-door salesman of pots and pans, revolutionised financial markets. His invention, the open-ended mutual fund, allowed retail customers to buy into a diversified portfolio of stocks and be confident that they would get a fair value when they wanted their money back. Leffler’s innovation gave lower and middle class people an ownership stake in American capitalism. It also spawned financial titans like Fidelity and Vanguard and thousands of smaller competitors that together employ hundreds of thousands of people.
/jlne.ws/3VtEAii

Fidelity’s Abby Johnson Tightens Grip on Far-Flung Family Empire; A decade into her reign, Johnson is reasserting control over the US fund giant’s London outpost. Heads are rolling.
Loukia Gyftopoulou – Bloomberg
The news quickly spread through Fidelity in London: Abigail Johnson, heir to the US fund giant founded by her grandfather, was tightening the screws on the family empire Anxious employees at Fidelity International, a globe-spanning business based in Bermuda and run out of London, began eying the door. Soon dozens were getting nudged out. Then the face of the operation, Chief Executive Officer Anne Richards, resigned.
/jlne.ws/4csMy1g

How the SEC Climate Rule Won Over Vocal Opponents; Though the agency faces attacks from both left and right after finalizing its climate disclosure rule, some businesses are happy they are off the hook
Richard Vanderford – The Wall Street Journal
The Securities and Exchange Commission is facing widespread opposition to its climate rule, but one group is breathing a sigh of relief after some final changes: small and medium-size businesses, which feared they would be casualties of the new disclosure requirements. The climate rule, which the SEC finalized earlier this month, will require public companies to report certain emissions figures and to tell investors about climate-related risk factors.
/jlne.ws/4a5yGIG

Open-Source Companies Are Sharing Their AI Free. Can They Crack OpenAI’s Dominance? Mistral AI, Hugging Face and others are betting they can stand up to OpenAI and big tech firms by making their technology open source-but it could lead to more risk than reward
Belle Lin – The Wall Street Journal
As the market for artificial intelligence models consolidates around Microsoft, OpenAI and a handful of other proprietary systems and players, some companies are aiming to compete by offering their AI models free. The open-source approach of freely distributing technology for the public to use, share and modify helped create the modern internet, cloud-computing and billion-dollar companies. There is no guarantee it will work for open-source large language models, but some of tech’s biggest players are betting it can help them chip away at OpenAI’s dominance.
/jlne.ws/3ILWeWN

UBS to Shut Thousands of Smaller Credit Suisse Asia Accounts; Bank plans to close balances in region under $2 million; Move underscores effort to trim megabank after merger
Ambereen Choudhury, Chanyaporn Chanjaroen, and Preeti Singh – Bloomberg
UBS Group AG is planning to shut smaller-value Credit Suisse accounts numbering in the low thousands at its Asia Pacific wealth management arm to exit relationships with poor returns, according to people familiar with the matter. The lender is reviewing the accounts with a balance of around $2 million or less, said the people, who asked not to be identified discussing private information. Many of the accounts are in the Asian business hubs of Singapore and Hong Kong, the people said.
/jlne.ws/3VrLDbe

FTX’s caretaker boss blasts Sam Bankman-Fried’s ‘life of delusion’ ahead of sentencing; John Ray says bankrupt crypto exchange’s founder is wrong to say customers will be made whole
Joe Miller – Financial Times
FTX’s caretaker chief executive has branded Sam Bankman-Fried a deluded criminal who masterminded a “colossal fraud”, and accused the bankrupt cryptocurrency exchange’s founder of lying about the losses incurred by former customers in an attempt to reduce his sentence. In a fiery letter to Judge Lewis Kaplan, who is due to pass sentence next week, John Ray said Bankman-Fried had run FTX “with hubris, arrogance, and a complete lack of respect for the basic norms of the law, which is all the more inexcusable given his privileged upbringing”.
/jlne.ws/3PqTceb

Sam Bankman-Fried lives ‘life of delusion,’ new FTX CEO says as sentencing looms
Luc Cohen – Reuters
Sam Bankman-Fried is delusional in claiming the possibility customers of now-bankrupt FTX cryptocurrency exchange may recover funds means he did not steal, his successor as CEO said on Wednesday. Bankman-Fried was convicted in November of stealing $8 billion from FTX customers. In a so-called victim impact statement filed in Manhattan federal court, Bankman-Fried’s successor, John Ray, said FTX customers will recoup some losses because of the bankruptcy estate’s efforts, not because Bankman-Fried did not steal.
/jlne.ws/3PrXL8j

The hot new scam on Wall Street
Krystal Hur – CNN
There’s a hot new scam on Wall Street, and, of course, it involves the world’s buzziest technology: artificial intelligence. The Securities and Exchange Commission said Monday that it had charged investment advisers Delphia and Global Predictions for making deceptive claims about their use of AI, a practice known as AI washing. Both firms agreed to settle the charges, according to the SEC. “Global Predictions cooperated fully with the inquiry and is pleased to put this behind us. Additionally, we have clarified across our marketing how exactly we use AI,” the company said in a statement to CNN on Monday. Delphia did not respond to requests for comment.
/jlne.ws/3TuVVoe

James Robinson III, American Express executive, 1935-2024; Wall Street power broker pioneered the model of the diversified ‘financial supermarket’
Stephen Gandel – Financial Times
In the summer of 1991, as he tells it, Warren Buffett was in trouble. The Berkshire Hathaway chair had risked his reputation trying to save Salomon Brothers, a scandal-plagued investment bank few wanted to do business with. That’s when he got a call from James Robinson III, who was then the chief executive of American Express and the biggest power broker on Wall Street. The two didn’t know each other well, despite serving together on the board of Coca-Cola.
/jlne.ws/4anCNiN

The rising risks of financial repression; This strategy appears to be the path of least resistance for governments to reduce debt and keep bond vigilantes at bay
Tomasz Wieladek – Financial Times
Financial markets and fiscal rules are pressuring governments to lower historically high public-debt-to-GDP ratios. Fiscal restraint and inflation are politically unpopular ways of doing that. And growing out of debt is less likely today, given low expected real GDP growth rates. What is known as financial repression appears to be the path of least resistance to reduce debt and keep bond vigilantes at bay.
/jlne.ws/4armdid

Bitcoin Had a Flash Crash; Sloppy whale sales, Yellow pensions, private credit poaching and portfolio voting.
Matt Levine – Bloomberg
Bitcoin flash crash
The US has about a dozen stock exchanges. Each stock trades on each stock exchange. Every so often the price of a stock on one exchange will be slightly lower than the price on another exchange. Books have been written about this fact, and people have made long and lucrative careers from it.
/jlne.ws/3Pr6Pu7

Ethereum Foundation Faces Inquiry From a Government; Fortune Says SEC Investigating ETH
Danny Nelson, Nikhilesh De, Sam Kessler – CoinDesk
The Ethereum Foundation – the Swiss non-profit organization at the heart of the Ethereum ecosystem – is facing questions from an unnamed “state authority,” according to the group’s website’s GitHub repository. The confidential inquiry comes during a time of change for Ethereum’s technology and at a possible inflection point for its native asset, ETH, which many American investment companies are seeking to offer as an exchange-traded fund. The Securities and Exchange Commission (SEC) has slow-walked their efforts despite recently approving a series of Bitcoin ETFs.
/jlne.ws/3Vsa5sR

Options market still searching for cause of the Vix plunge; BIS paper blames yield-enhancing structured products, but market participants are unconvinced
Helen Bartholomew and Faye Kilburn – Risk.net
A fierce debate is flaring over whether popular retail investment products are artificially suppressing the Cboe Volatility Index, known as the Vix, which measures the implied 30-day volatility of the S&P 500. A paper published by the Bank for International Settlements on March 4 blames yield-enhancing structured products that sell options against long stock positions for depressing the Vix, which has defied geopolitical tensions and recession fears to average 13.5 this year compared to a
/jlne.ws/3v9a2Ys

Coinbase Derivatives Plans To Launch Futures Trading for Dogecoin in Letter to CFTC
Hope C – CoinMarketCap
Coinbase Derivatives, a popular cryptocurrency exchange, announced its plans to introduce futures trading for Dogecoin, Litecoin and Bitcoin Cash on April 1. On March 7, Coinbase submitted three separate letters to the Commodities Futures Trading Commission (CFTC) outlining its proposal for monthly cash-settled futures contracts for Dogecoin, Litecoin, and Bitcoin Cash. The letters, addressed to CFTC Secretary Christopher Kirkpatrick, provided detailed information regarding the contracts’ sizes, settlement methods, and structure. Coinbase intends to utilize the self-certification route under CFTC Regulation 40.2(a) to list these futures contracts, allowing them to proceed without direct approval from the CFTC as long as they comply with the Commodity Exchange Act and CFTC regulations.
/jlne.ws/3IOAzgS

India in undersea race to mine world’s battery metal
Navin Singh Khadka – BBC
India is taking another step in its quest to find valuable minerals hidden in the depths of the ocean which could hold the key to a cleaner future. The country, which already has two deep-sea exploration licences in the Indian Ocean, has applied for two more amid increasing competition between major global powers to secure critical minerals. Countries including China, Russia and India are vying to reach the huge deposits of mineral resources – cobalt, nickel, copper, manganese – that lie thousands of metres below the surface of oceans. These are used to produce renewable energy such as solar and wind power, electric vehicles and battery technology needed to battle against climate change.
/jlne.ws/49SVQ4N

Texas to Release Details of $5 Billion Power-Development Fund
Naureen S Malik – Bloomberg
Texas regulators will release details Thursday of a $5 billion energy fund intended to spur development of new power projects in a state plagued by years of electricity glitches. The information will be released by the Public Utility Commission, member Jimmy Glotfelty said in an interview at the CERAWeek by S&P Global conference in Houston on Wednesday.
/jlne.ws/3VxVKLL

UK-sanctioned oil trader enlists ex-Biden aide to thwart potential US sanctions; Paramount founder Niels Troost has hired lobbyist Ankit Desai for $100,000 a month
Tom Wilson – Financial Times
The founder of Swiss oil trader Paramount Energy & Commodities SA has hired a former aide to Joe Biden to help prevent potential US sanctions after being targeted by the UK government over his involvement in trading Russian oil. Dutch veteran trader Niels Troost has enlisted Ankit Desai to advise on whether the US government plans to take punitive measures against him or his companies, according to a copy of a lobbying contract filed with the US Department of Justice. Desai worked for then Senator Biden in 2005.
/jlne.ws/48ZJ2s8

Oil Trading Is Still Rife With Bribes. Time the Industry Cleaned Up; A series of lawsuits suggests kickbacks to government officials are still viewed as business as usual.
Javier Blas – Bloomberg
Torbjoern Toernqvist, co-founder of Gunvor Group Ltd. and one of oil trading’s most senior executives, famously said about his industry: “There’s a lot of skeletons, and many of them, most of them, will never be surfaced.” Never say never. It’s taken too long, but prosecutors are now unearthing those bones, revealing an ugly graveyard of bribes paid to government officials in return for lucrative contracts.
/jlne.ws/3PxvA81

Ukraine Invasion

Ukraine races to build weapons at home
David L. Stern – The Washington Post
Ukraine manufactured practically no weapons before Russia invaded in February 2022, but the local arms industry is now booming. Factories spit out shells, mortar rounds, military vehicles, missiles and other items crucial to the war effort. Production tripled in 2023 and is expected to increase sixfold this year, Prime Minister Denys Shmyhal said at a Ukrainian government meeting in January.
/jlne.ws/3PpT2DR

Russia’s Belgorod region is under attack again from Ukraine. Why does it keep getting targeted?
The Associated Press
Russia’s Belgorod region has come under increasing Ukrainian attacks this month as the invasion by Moscow grinds into its third year. A look at the region and its role in the war: WHAT IS THE BELGOROD REGION? The region of forests, farmland and rolling hills has a 540-kilometer (335-mile) border along Ukraine’s northeastern edge. It has an area of over 27,000 square kilometers (about 10,500 square miles), and has a population of about 1.5 million.
/jlne.ws/3TKwDUl

Russia says it is pushing Ukrainian forces back, will create two new armies
Guy Faulconbridge – Reuters
Russia said on Wednesday its soldiers were pushing Ukrainian forces back and that Moscow would bolster its military by adding two new armies and 30 new formations by the end of this year. Russia, which invaded Ukraine in 2022, swiftly pulled back some of its forces in the east and south after over-extending but has been slowly advancing after a Ukrainian counteroffensive last year failed to make significant gains.
/jlne.ws/43qgFly

Russia says Ukraine’s idea of $30 oil price cap “beyond all bounds”
Vladimir Soldatkin and Guy Faulconbridge – Reuters
Russia said on Thursday that the United States was unlikely to agree to a Ukrainian proposal to lower the price cap on Russian oil to $30 a barrel because it would roil global energy markets and damage the U.S. economy. After Russia sent troops into Ukraine in 2022, the West sought to sink the Russian economy by imposing a myriad of sanctions and in 2022 slapped a $60 a barrel price cap on Russian oil, which is currently traded at around $68 per barrel.
/jlne.ws/3vnyRzW

Israel/Palestine Conflict

Yemen’s Houthis Tell China, Russia Their Ships Won’t Be Targeted
Sam Dagher and Mohammed Hatem – Bloomberg
The Yemen-based Houthis have told China and Russia their ships can sail through the Red Sea and Gulf of Aden without being attacked, according to several people with knowledge of the militant group’s discussions. China and Russia reached an understanding following talks between their diplomats in Oman and Mohammed Abdel Salam, one of the Houthis’ top political figures, said the people, who asked not to be named discussing private matters.
/jlne.ws/3Vns0B2

Middle East Conflict Threatens Inflation Relief, SNB Chief Warns; War could drive oil prices and inflation, Thomas Jordan says; Swiss central bank surprised with first G-10 rate cut
Bastian Benrath and Rosalind Mathieson – Bloomberg
The conflict in the Middle East could spark major problems for the central banks around the world, according to Swiss National Bank President Thomas Jordan. Asked after the single greatest risk for monetary policy at the moment, Switzerland’s central bank chief named “the Middle East, where we have suddenly a negative supply shock with respect to energy.” This could boost oil prices and drive up inflation again, he told Bloomberg Television in an interview on Thursday.
/jlne.ws/3TuZgn8

Exchanges, OTC and Clearing

Aquis sees double digit growth on the back of data and technology boom; Net revenue at the exchange rose 13% to £22.7 million in 2023; changes to proprietary trading saw an increase in market share to 5.46%.
Annabel Smith – The Trade
Aquis has seen another year of strong growth thanks to rising revenues in its data and technology businesses. Data and technology saw 24% and 22% growth to £3.7 million and £6.3 million respectively, pushing Aquis’ net revenues for the year up 13% to £22.7 million. The exchanges markets business also saw 7% growth to £10.9 million for the year.
/jlne.ws/4crXigk

SGX FX secures ‘Best Exchange’ title again at FX Markets Asia Awards
SGX
Deep liquidity and capital efficiencies continue to drive higher on-exchange trading and clearing on SGX FX, alongside rising volumes on its OTC FX platforms
Flagship SGX USD/CNH Futures and SGX INR/USD Futures are among the topmost traded FX futures contracts globally. SGX FX has been named ‘Best Exchange’ again at the reputable FX Markets Asia Awards – an accolade it has earned every year since the awards were launched in 2018 to recognise the leaders and achievements in the foreign exchange (FX) industry across Asia Pacific.
/jlne.ws/3PuFIya

CCPs show support for daily stress margin tools; Anti-procyclicality measure floated by HKEX official sparks interest from rivals including Nasdaq
Luke Clancy – Risk.net
Senior clearing officials are lending their support to new liquidity funding tools that could provide users with daily updates on the likely margin impact stemming from stress events and help them prepare for margin calls. Speaking on a panel at the World Federation of Exchanges conference in Madrid today (March 20), Tao Chen, group head of quantitative risk management at Hong Kong Exchanges and Clearing (HKEX), floated the idea of daily simulations as a prudent anti-procyclicality measure
/jlne.ws/49a4YRk

Nasdaq liquidity risk hits record high on increased settlement flows; Maximum amount owed to CCP by single member in stress scenario rises 15%
Joshua Walker – Risk.net
Nasdaq’s liquidity risk hit an all-time high in the fourth quarter, following increased market activity at the end of last year. Liquidity risk – as measured by the largest payment a single clearing member would owe the central counterparty (CCP) in extreme but plausible market conditions – hit Skr38.2 billion ($3.7 billion) across all currencies at December 31. That was up 15.2% from three months prior, and the highest score since records began in 2015.
/jlne.ws/3TLyMzq

Cboe Introduces Enhanced Margin Treatment for Index Options Overwriting Strategies; Margin rule change aims to enhance capital efficiencies when writing cash-settled index options against ETFs based on the same index; Enables traders to use cash-settled index options as an efficient trading and hedging tool to manage positions at a potentially lower cost; Cboe’s suite of index options offer cash-settlement, European-style exercise and potential tax benefits
Cboe Global Markets, Inc.
Cboe Global Markets, Inc. (Cboe: CBOE), the world’s leading derivatives and securities exchange network, today announced the introduction of enhanced margin treatment for cash-settled index options. Cboe’s margin relief rule aims to provide greater capital efficiencies for traders and reflects its ongoing commitment to advocating for smart and responsive market structure enhancements that meet the evolving needs of its customers.
/jlne.ws/4a7PXB2

India to start optional same-day settlement for 25 stocks
Reuters
India’s markets regulator will start an optional same-day settlement for 25 stocks with a limited number of brokers on March 28, according to a circular on its website published on Thursday. Referring to the launch as beta version, the Securities and Exchange Board of India (SEBI) said the optional T+0 will work alongside the existing T+1 settlement. In T+1, trades are settled within 24 hours of execution.
/jlne.ws/3vvLwk9

BME hosts WFEClear 2024 in Madrid, the world’s largest Clearing event with representatives from more than 44 exchanges
BME
Javier Hernani, CEO of BME and Head of Securities Services at SIX, highlights SIX’s commitment to leading the digital assets area. The three-day event focused on issues such as the role of Central Counterparties, regulatory challenges and the role of DLT technology. Over the last three days, BME hosted the 40th edition of WFEClear, an event organised by the World Federation of Exchanges (WFE) which brought together more than 200 representatives of various market infrastructures from all over the world. The leading Clearing meeting was attended by the CEO of the WFE, Nandini Sukumar, and the CEO of BME and Head of Securities Services at SIX, Javier Hernani.
/jlne.ws/3x2J19F

SIX Hosts WFEClear 2024 in Madrid with Representatives from More than 44 Exchanges; The three-day event focused on issues such as the role of Central Counterparties, regulatory challenges and the role of DLT technology. Javier Hernani, Head of Securities Services at SIX, highlighted SIX’s commitment to leading the digital assets area.
SIX
Over the last three days, SIX hosted the 40th edition of WFEClear, an event organised by the World Federation of Exchanges (WFE) which brought together more than 200 representatives of various market infrastructures from all over the world. The leading Clearing meeting was attended by the CEO of the WFE, Nandini Sukumar, and the Head of Securities Services at SIX, Javier Hernani. Javier Hernani analyzed the highlights of the sector at the moment and focused his opening remarks on highlighting the crucial role of Clearing in financial markets. https://jlne.ws/3PwazKP

ECC acquires clearing business of BSP Energy Exchange in Slovenia
European Commodity Clearing
European Commodity Clearing (ECC) and BSP Energy Exchange LLC (BSP) announce that ECC will take over clearing services for BSP power spot intraday continuous and day-ahead customers. Subject to successful testing and external stakeholders’ readiness, ECC will start clearing and settlement from 16 April 2024.
/jlne.ws/3wXB7OA

ICE First Look at Mortgage Performance: Delinquencies Improve and Foreclosures Drop as Prepayments Rise Modestly
Intercontinental Exchange
The national delinquency rate eased to 3.34% in February, down 4 basis points (bps) from the month before and 11 bps lower than in February 2023. While the number of borrowers one payment behind rose modestly by 10K, those 60 days late as well as those 90 or more days past due both fell to their lowest levels in three months. Delinquency inflows rose 6.5% from January’s eight-month low, while rolls to later stages continued their recent improvement. Serious delinquencies (loans 90+ days past due but not in active foreclosure) are down 103K (-18%) year over year, with the population now standing at 459K.
/jlne.ws/3xeUd2I

Moscow Exchange launches new derivatives on foreign assets
MOEX
On March 26, 2024, trading in settled futures contracts for shares of the global exchange-traded funds (ETFs) DJ Industrial Average ETF and iShares Russell 2000 ETF will begin on the Moscow Exchange derivatives market. New instruments will allow investors to participate in the movement of global markets, while remaining in Russian jurisdiction, to hedge their securities portfolios and gain additional diversification of their investments. Futures are aimed at a wide range of private and institutional investors.
/jlne.ws/3TpN3Ad

Delisting of the Sector Index Futures on the S&P/ TSX Composite Media, GICS Industry Group Total Return Index (SXS) and the basis trade on, close on the Sector Index Futures on the S&P/ TSX Composite Media GICS, Industry Group Total Return Index (BXX)
The Montreal Exchange
The Bourse and CDCC wish to inform you that following the decommissioning of the S&P/TSX
Composite Media GICS Industry Group Total Return Index, the associated sector index futures
on the S&P/TSX Composite Media GICS Industry Group Total Return Index (SXS) and basis
trade on close on the sector index futures on the S&P/TSX Composite Media GICS Industry
Group Total Return Index (BXX) will be delisted at the close of business on March 20, 2024.
/jlne.ws/3TrLNfZ

Fintech

‘Transformed’ Trading Technologies to Accelerate Growth
MarketsMedia
Fresh off a series of acquisitions and steady organic growth, Trading Technologies is seeking further expansion via multi-asset trading products and doing more business in Asia-Pacific. Speaking with Traders Magazine March 12 at the International Futures Industry Conference in Boca Raton, Trading Technologies Chief Executive Officer Keith Todd noted the company has “transformed” since his first FIA Boca event as CEO two years ago, with annual revenue up from $98 million to $170 million.
/jlne.ws/4akf0R0

Hindenburg Bets Against Data Center Owner Equinix in New Report
Natalie Wong – Bloomberg
Short seller Hindenburg Research targeted data center owner Equinix Inc. Wednesday, alleging that the company manipulates its accounting and is selling an “AI pipe dream.” Hindenburg’s disclosure of a short position and its allegations raise questions about the future for Equinix, which has been benefiting from the expectation that artificial intelligence companies will need even more data centers to power the technology. Equinix shares were pummeled Wednesday and the company pulled a previously planned bond offering after the report hit.
/jlne.ws/4a3O1cs

Nvidia CEO Becomes Kingmaker by Name-Dropping Stocks
Jeran Wittenstein – Bloomberg
Nvidia Corp. Chief Executive Officer Jensen Huang’s highly anticipated keynote failed to move the needle for his stock. But it turned out to be good for many of the company’s customers and partners. While Nvidia shares edged lower, falling about 3.3% Tuesday, after the executive unveiled a new processor design called Blackwell, Huang’s touts of other companies – delivered during a two-hour presentation Monday in San Jose, California – sent their stocks higher.
/jlne.ws/4crVq6W

Novo Foundation, Nvidia Team Up to Build Danish AI Supercomputer
Christian Wienberg – Bloomberg
Novo Nordisk Fonden, the enterprise foundation behind Novo Nordisk A/S, will work with Nvidia Corp. to build a supercomputer in Denmark to help research and innovation in health care, life sciences and the green transition. Researchers from Denmark’s public and private sectors will be able to use the computer, which will run on Nvidia’s artificial intelligence technology and will be one of the world’s most powerful machines, according to a statement.
/jlne.ws/43uIRni

Saudi Arabia plans $40 billion push into artificial intelligence, NYT reports
Reuters
Saudi Arabia’s government plans to create a fund of about $40 billion to invest in artificial intelligence, the New York Times reported on Tuesday, citing three people briefed on the plans. Representatives of Saudi Arabia’s Public Investment Fund (PIF) have discussed a potential partnership with U.S. venture capital firm Andreessen Horowitz and other financiers in recent weeks, the newspaper reported.
/jlne.ws/3TpF9ag

Robinhood is now available to all customers in the United Kingdom; The largest UK brokers typically charge UK investors, with a £10,000 portfolio, an average of £240 per year to invest in US stocks-Robinhood offers no commission fees and no foreign exchange (FX) fees on trades.
Robinhood
Today, we’ve rolled all eligible customers off our waitlist and Robinhood is now officially available throughout the United Kingdom. With Robinhood, customers simply get more for their money, with no commission fees and no foreign exchange (FX) fees on trades, access to more than 6,000 global companies listed on US markets, and more. Customers’ capital is at risk and other costs apply-see our fee schedule here. We’re also launching support for several new features today including web support, rewards for signing up, and a referral program for friends and family.
/jlne.ws/43uoQNP

OpenAI and the Fierce AI Industry Debate Over Open Source
Rachel Metz – Bloomberg
/jlne.ws/3Tv3QC7

BBC develops AI plans and talks to Big Tech over archives access; UK broadcaster seeks to build artificial intelligence models and negotiates with companies on content deal
Daniel Thomas – Financial Times
/jlne.ws/3TuuKdm

AI can help CEOs communicate. Can it be trusted? Digital tools can inform and enrich speeches but few would use their content verbatim
Anjli Raval – Financial Times
/jlne.ws/43quOzo

‘Solid gold’ payments card case exposes limits of UK regulator; Arrest of Nvayo’s Christopher Scanlon raises questions about FCA’s ability to oversee digital payments sector
Laura Noonan – Financial Times
/jlne.ws/48ZJkPK

Cybersecurity

The U.S. Now Has a National Cybersecurity Strategy, but Is It as Strong as It Could Be?
GAO
In February, Change Healthcare, the largest health care payment processer in the United States, was the victim of a ransomware attack that disrupted services across the country. The attack threatened health care workers’ paychecks, impacted the ability to fill prescriptions, and even disrupted patient care throughout the health care system.
/jlne.ws/496ndqI

How To Combat AI-Powered Phishing In An Increasingly Ambiguous Cyber Landscape
Gordon Lawson – Forbes
The rise of artificial intelligence (AI) technologies has transformed the business world, enhancing efficiency and enabling groundbreaking innovations. However, this progress comes with an increasing slate of cybersecurity challenges, particularly in phishing attacks. The integration of AI into phishing schemes has reached a level of sophistication where discerning legitimate communications from malicious ones is becoming increasingly difficult, if not nearly impossible, for the average user.
/jlne.ws/3VrjFfw

Breaking Barriers in Cybersecurity: Meet The First Woman CIO At The White House
Nancy Wang – Forbes
In the dynamic realm of cybersecurity and technology, women have been making significant strides, reshaping industries, breaking barriers, and fostering innovation. This article delves into the impactful roles of Theresa Payton, Bridget O’Connor, and Melissa O’Leary in the cybersecurity landscape, highlighting their contributions to transforming organizations and cultures.
/jlne.ws/3TqcX71

Cryptocurrencies

Robinhood rolls out crypto wallet to Android users globally
by Yogita Khatri – The Block
Robinhood has officially rolled out its cryptocurrency wallet for Android users, expanding access to millions of potential crypto users worldwide. The Android expansion comes a year after Robinhood Wallet was launched to iOS users globally. The Android app was in beta until now, with a public waitlist open for registrations. Now with the general release, all customers who previously joined the waitlist can now download the Android wallet and get started, Robinhood said Wednesday. The Android launch marks a “big step forward” in Robinhood’s commitment to making crypto more accessible and integrated into daily life for millions of people worldwide, said Johann Kerbrat, general manager of Robinhood Crypto, in a statement.
/jlne.ws/3VykqDw

Binance executives remain in detention after Nigeria court appearance, families say
Reuters
Two executives from Binance, the world’s largest cryptocurrency exchange, will remain in detention for at least two more weeks in Nigeria after appearing in court for the first time on Wednesday and even though they have not been charged with a crime, their families said. Tigran Gambaryan, a U.S. citizen and Binance’s head of financial crime compliance, and Nadeem Anjarwalla, a British-Kenyan who is Binance’s regional manager for Africa, flew to Nigeria following the country’s decision to ban several cryptocurrency trading websites and were detained on arrival on Feb. 26.
/jlne.ws/494L8H5

FTX Was Down to Last 105 Bitcoins When Bankruptcy Rescue Crew Arrived: John Ray
Cheyenne Ligon – CoinDesk
Current FTX CEO John J. Ray III is pushing back against his disgraced predecessor Sam Bankman-Fried’s claims that customers lost “zero” money in the exchange’s 2022 collapse, calling them “categorically, callously, and demonstrably false.” In a victim impact statement penned by Ray on behalf of FTX and its subsidiaries, Ray told New York District Court Judge Lewis Kaplan that Bankman-Fried’s “delusional” claims that his exchange was solvent are a “mischaracterization” of the estate’s January statement that they expect to pay customers back in full.
/jlne.ws/3IOuVLq

Bitcoin Is a More ‘Superior Form of Sound Money’ Than Gold: Kraken Head of Strategy
CoinDesk
Kraken Head of Strategy Thomas Perfumo discusses the comparison between bitcoin and gold as stores of value and inflation hedges. Bitcoin has a “more predictable and programmatic supply curve because it’s built on mining and the halvings,” Perfumo said.
/jlne.ws/48YV05e

US Spot-Bitcoin ETFs Post Largest Three-Day Outflow Since Launch
Sidhartha Shukla – Bloomberg
A group of 10 spot-Bitcoin exchange-traded funds posted its biggest three-day outflow since the products debuted in January, a turnaround from the clamor for exposure that earlier drove to the token to a record high. A net $742 million left the ETFs from Monday through Wednesday, reflecting outflows from the Grayscale Bitcoin Trust and a moderation in subscriptions for rival offerings from the likes of BlackRock Inc. and Fidelity Investments.
/jlne.ws/4a0JrM1

MicroStrategy shares fall 13% after convertible deal for bitcoin purchases
Reuters
/jlne.ws/3Pw3UjN

Ethereum Foundation Faces Inquiry From a Government; Fortune Says SEC Investigating ETH
Danny Nelson, Nikhilesh De, Sam Kessler – CoinDesk
/jlne.ws/3Vsa5sR

The Feds Are Reportedly Investigating Ethereum Foundation
Matt Novak – Gizmodo
/jlne.ws/494QPok

Ether Tumbles 6% as ETH ETF Hopes Dim Amid Regulatory Probe Reports
Krisztian Sandor, Helene Braun. – CoinDesk
/jlne.ws/4apHcld

BlackRock Enters Asset Tokenization Race With New Fund on the Ethereum Network
Krisztian Sandor – CoinDesk
/jlne.ws/3VzbHB0

Politics

Trump SPAC Sues to Force Board Member’s Vote for Media Deal
Greg Farrell – Bloomberg
The company planning to take Trump Media & Technology Group public sued to force its biggest investor, ARC Global Investments II, to vote in favor of the deal before a critical deadline this week. The suit, filed in New York state court Tuesday, is the latest legal battle between Digital World Acquisition Corp. and its former chairman, Patrick Orlando. While he was ousted last year, Orlando still holds significant leverage over the company through his ability to influence the voting shares of ARC.
/jlne.ws/3TK48q5

Blinken Warns of False Info ‘Flood’ As Elections Loom Worldwide; US secretary of state makes comments at democracy summit; Adversaries using disinformation to exploit fissures, he says
Iain Marlow – Bloomberg News
Secretary of State Antony Blinken warned that authoritarian governments were going to meddle in a flurry of elections and the US would keep pressing to disrupt misinformation efforts from China and Russia. “Nearly half the people of the world are going to be going to the polls this year – this is an extraordinary election year in country after country,” Blinken told a session at the Summit for Democracy conference in Seoul on Monday. “But citizens and candidates will face a flood of falsehoods that suffocate serious civic debate.”
/jlne.ws/3TpE3eE

No Labels Struggles to Recruit US Presidential Nominee
Billy House – Bloomberg
No Labels founding chairman Joe Lieberman said the centrist group has faced a “daunting” struggle to recruit a candidate to mount a third-party run for US president. Lieberman, a former Democratic senator who left the party to become an independent, said the group is in talks with “a couple of quality candidates” whom he declined to identify, and would make a decision within weeks.
/jlne.ws/4cnW7OS

Regulation

SEC probing crypto companies in Ethereum investigation as hopes for ETF dim
Jeff John Roberts, Leo Schwartz – Fortune
The Securities and Exchange Commission is waging an energetic legal campaign to classify Ethereum, the second-most popular cryptocurrency, as a security, according to U.S. companies that have received subpoenas related to an investigation. The news delivers a further blow to the crypto industry’s hopes the agency will approve applications by BlackRock and others for an Ethereum ETF following the SEC’s approval of a series of Bitcoin ETFs in January.
/jlne.ws/3TI1KzY

Former takeaway worker found with £2bn worth of Bitcoin convicted of money laundering
The Telegraph
A former takeaway worker found with Bitcoin wallets worth more than £2 billion has been convicted of a crime linked to money laundering. Jian Wen, 42, was living in a flat above a Chinese restaurant in Leeds when she became involved in converting the cryptocurrency into assets, including multi-million pound houses and thousands of pounds worth of jewellery. The Bitcoin seizure is thought to be the biggest ever of its kind.
/jlne.ws/3TL3VCW

Top US bank overseer to unveil merger policy proposal
Reuters
The U.S. Federal Deposit Insurance Corporation on Thursday is set to become the latest American regulator to propose new policies for mergers among banks amid the instability that continues to rattle midsize lenders. The FDIC’s board of directors, comprising Democratic and Republican officials, is due to convene at 10 a.m. ET (1400 GMT) to discuss the proposal, details of which have not yet been published.
/jlne.ws/3PxqecS

Montenegro court confirms mogul known as ‘cryptocurrency king’ to be extradited to South Korea
Predrag Milic – Associated Press
An appeals court in Montenegro on Wednesday confirmed that a South Korean mogul known as “the cryptocurrency king” will be handed over to his native country. Both South Korea and the U.S. had requested Do Kwon’s extradition from Montenegro. A Montenegrin court initially decided he should be handed over to the U.S. but that ruling was later overturned in favor of South Korea.
/jlne.ws/3TM0hc7

UK Woman Guilty of Laundering Bitcoin Linked to $6 Billion China Fraud; Jury finds Jian Wen guilty on one count of money laundering; Jian helped Chinese fugitive Zhimin Qian launder Bitcoin
Upmanyu Trivedi and Katharine Gemmell – Bloomberg
A woman was found guilty by a London jury of laundering massive amounts of Bitcoin for a Chinese fugitive who is thought to have orchestrated a near $6 billion investment fraud. Jian Wen, a 42-years-old British citizen, helped a Chinese fugitive launder the money between 2017 and 2022. The jury found Jian guilty on one count of money laundering and couldn’t reach a decision on two other charges.
/jlne.ws/4anVgvS

Joint Effort Launches to Warn Retirees about Precious Metals Fraud and Gives Tips on Protecting Themselves
CFTC
The Commodity Futures Trading Commission’s Office of Customer Education and Outreach (OCEO), the Financial Industry Regulatory Authority (FINRA), and the North American Securities Administrators Association (NASAA) have joined forces to warn people in or near retirement about gold and silver investment scams that tout over-priced metals and coins as “safe investments,” but instead charge exorbitant markups, commissions, and fees. In many cases, the transaction costs and ongoing fees make it impossible for victims to ever profit from their investments.
/jlne.ws/3VtFqLY

SEC’s OMWI FY 2023 Annual Report Highlights the Agency’s Diversity, Equity, Inclusion and Accessibility Initiatives and Progress
SEC
As part of its continuing efforts to promote diversity, equity, and inclusion with regulated entities, the Securities and Exchange Commission’s Office of Minority and Women Inclusion (OMWI) published two reports: the 2022 Diversity Assessment Report for Entities Regulated by the SEC and OMWI’s Fiscal Year (FY) 2023 Annual Report to Congress.
/jlne.ws/493MX7g

Office Hours with Gary Gensler: Corporate Governance
Chair Gary Gensler – SEC
What does the SEC, a securities regulator, have to do with corporate governance? You might be thinking corporate governance relates to a company’s board of directors or management, or it’s a matter of state law. And you’d be right. But there’s more to this story. When the SEC was formed 90 years ago, a lot of things had broken down. The stock market, of course, had broken down, but so had matters regarding corporate governance.
/jlne.ws/3VnvYcU

SEC Obtains Final Judgment Against Individual in Stock Selling Scheme
SEC
On March 19, 2024, the U.S. District Court for the District of Massachusetts entered final judgments against California resident Kevin C. Dills and two entities that Dills controlled.
/jlne.ws/3PwzFZQ

SEC Obtains Judgments Against Microcap Company and its CEO Following Trial
SEC
On March 20, 2024, a federal district court in Connecticut entered final judgments against Connecticut-based penny stock company Halitron, Inc. and its CEO, Bernard Findley. The judgments follow a trial and a January 17, 2023 jury verdict finding Halitron and Findley liable for fraudulently issuing false and misleading press releases in an effort to prop up the value of Halitron’s stock and thereby attract financiers who provided funding to Halitron in exchange for discounted shares of Halitron stock. Among other things, the judgments require the defendants to variously pay a total of over $441,000.
/jlne.ws/3Vw866T

Retail trader jailed for securities fraud via illegal short selling
SFC
The Eastern Magistrates’ Court today sentenced Ms Christine Yeung Tak Sum, a retail trader, to 18 months of imprisonment following her conviction for securities fraud involving illegal short selling in a prosecution brought by the Securities and Futures Commission (SFC) (Note 1). This is the first case where an individual was convicted for the offence of employing a fraudulent or deceptive scheme with intent to defraud in transactions involving securities under section 300 of the Securities and Futures Ordinance in the context of illegal short selling.
/jlne.ws/3TM7qYP

Investing and Trading

Reddit poised to make its stock market debut after IPO prices at $34 per share amid strong demand
Michael Liedtke – Associated Press
Reddit will enter a new era as a publicly traded company with a market value of $6.4 billion after the social media platform’s initial public offering was priced at $34 per share. The price announced late Wednesday came in at the top end of the target range set by Reddit’s investment bankers as they spent the past few weeks gauging investor demand for the stock. It sets the stage for Reddit’s shares to begin trading Thursday on the New York Stock Exchange under the ticker symbol “RDDT” in a debut likely to spur a flurry of commentary on Reddit’s own platform, as well as competing social media outlets.
/jlne.ws/3x4L4Kb

US ETF issuers rush to offer investors new ways to bet on US tech megacap stocks
Suzanne McGee – Reuters
Asset management companies seeking to offer investors still more ways to play the boom in U.S. mega-cap technology stocks are rolling out new exchange-traded funds (ETFs). GraniteShares on Monday launched three new leveraged ETFs designed to generate twice the daily return of Microsoft, Amazon.com and Advanced Micro Devices.
/jlne.ws/3xbHQ7C

Gold Jumps Above $2,200 an Ounce for First Time on Dovish Fed
Sybilla Gross, Yvonne Yue Li, and Jack Ryan – Bloomberg
Gold surged above $2,200 an ounce for the first time as investors grew more confident about the Federal Reserve’s path for rate cuts, boosting the appeal of non-interest bearing bullion. The precious metal rose as much as 1.6% to a record $2,220.89 in early trading, before paring those gains. Gold has rallied more than 10% since mid-February, as the outlook for looser US monetary policy triggered fresh bets on bullion by investors. While the speed of gold’s rally caught some market watchers off guard, the Fed appeared to reaffirm those bullish expectations on Wednesday. The central bank maintained its outlook for three rate cuts this year, suggesting it isn’t alarmed by a recent uptick in inflation.
/jlne.ws/3vvLVDb

“FOMO Insurance” Dominates Key Equity Options
Steve Sosnick – Interactive Brokers
It may seem like a quaint notion to a new generation of YOLO-inspired speculators, but options markets arose as a way to transfer and hedge risk. When we view options pricing data for some outperforming stocks, we see that FOMO is the main risk that is being hedged. The key to the prior assertion involves understanding the concept of options “skew”.[i] When we plot the implied volatilities of each options strike for a given expiration, they typically show a non-linear output. It is normal to see a curve with a low ebb at-market or slightly above-market, with higher implied volatilities prevailing for below-market options than for those of similarly above-market options. Below is a graph showing skews for S&P 500 (SPX) options for the next three monthly expiries. The skews are relatively typical for a given stock or index:
/jlne.ws/4cmt0eF

Environmental, Social and Corporate Governance

World’s top fossil-fuel bosses deride efforts to move away from oil and gas; Executives at Texas summit claim clean-energy transition is failing and say world should ‘abandon the fantasy’ of fossil-fuel phaseout
Oliver Milman – The Guardian
The bosses of the world’s leading oil and gas companies have poured scorn on efforts to move away from fossil fuels, complaining that a “visibly failing” transition to clean energy was being pushed forward at an “unrealistic pace”. The oil executives, gathered at the industry’s annual Cera Week conference in Houston, Texas, have taken turns this week to denounce calls for a rapid phase-out of fossil fuels, despite widespread acknowledgment within the industry, as well as scientists and governments, of the need to radically reduce planet-heating emissions to avoid the worst effects of the climate crisis.
/jlne.ws/43wnhin

***** Here is this story from Reuters.

US gives carmakers more time to meet aggressive emissions targets; Auto sector says final EPA rule presents ‘more reasonable’ goals for adoption of electric vehicles
Aime Williams, Jamie Smyth and Claire Bushey – Financial Times
The Biden administration is giving carmakers an extra three years to meet aggressive emissions targets, bowing to pressure from manufacturers, auto workers and the oil industry in a move that could slow the adoption of electric vehicles. The Environmental Protection Agency on Wednesday released a final rule regulating emissions from cars and light trucks that will demand the steepest cuts to vehicle emissions starting in 2030 – not from 2027 as first proposed last year.
/jlne.ws/49217pn

*****This story from Bloomberg and from 1440.

Bond Investors Flag ESG Dilemma in Europe’s Plan to Fund Defense
Aline Oyamada and Sujata Rao – Bloomberg
The possibility that Europe will tap its investment bank to fund defense spending is being met with skepticism from bond investors, who flag risks to the lender’s sustainability credentials and higher borrowing costs. Given the European Investment Bank’s focus on environmental and social projects, it would likely have to tap other investors outside the ESG industry for any military financing. To analysts and fund managers, the better option is for the EU to raise the money directly through its joint-borrowing program.
/jlne.ws/3TVfckp

Western countries ‘too optimistic’ on nuclear projects, warns engineering chief; Chief executive of AtkinsRaalis says more planning needed ahead of first global nuclear energy summit
Alice Hancock – Financial Times
Western countries mishandle nuclear energy projects by failing to plan and trying to complete them too fast, the head of AtkinsRaalis, the biggest maker of reactors that run on natural uranium, has warned ahead of the first global nuclear summit this week. “Clients, governments and ourselves as the industry players…we all become too optimistic. We have this optimism bias towards being able to deliver faster,” Ian Edwards, chief executive of the Canadian engineering company, told the Financial Times.
/jlne.ws/43sjQJC

Europe’s Nuclear Revival Plans Are Too Little, Too Late; Emboldened leaders are pushing for more investment in sector; Nuclear set to make up less than 1% of power mix by 2050
John Ainger and Jonathan Tirone – Bloomberg
European leaders are trying to move past decades of neglect to spur a renaissance in nuclear energy. The fear is that it may already be too late. The region has set stiff targets for lowering emissions and ensuring energy security by the middle of the century, emboldening nuclear proponents who say the technology can help solve both issues.
/jlne.ws/3x4dRyJ

What Bottlenecks? A Major Asset Manager Is All-In on Renewables; “There is just so much to build, so much support and lots of profit on the table,” Brookfield Renewable Partners CEO Connor Teskey says on this week’s Zero.
Akshat Rathi, Will Mathis, and Magnus Henriksson – Bloomberg Zero (podcast)
/jlne.ws/43p8TIN

Morgan Stanley Targets $1 Billion for Energy-Transition Bets
Gillian Tan – Bloomberg
/jlne.ws/4a2rcWy

Dutch court rules KLM ads ‘misleading’ in greenwashing case; Victory for activists in latest consumer protection action over sustainability claims
Kenza Bryan and Philip Georgiadis – Financial Times
/jlne.ws/3TGR6cN

Why Bain is going beyond net zero
Sarah Golden and Margaret Morales – GreenBiz
/jlne.ws/3PTqT8P

Institutions

JPMorgan sets up a dedicated sports investment banking team, memo shows
Reuters
JPMorgan Chase has created a new sports-focused investment banking team as the Wall Street bank seeks to tap an increasingly lucrative industry, according to an internal memo seen by Reuters on Tuesday. The bank has created a new “sports investment banking coverage group” which will offer advisory and financing solutions for activities like investing in sports franchises to clients globally.
/jlne.ws/43pIpH4

Nationwide to buy Virgin Money for £2.9bn; Companies confirm details outlined this month to form challenger to UK’s biggest banks
Akila Quinio and Oliver Ralph – Financial Times
Nationwide Building Society has announced a £2.9bn deal to acquire Virgin Money, two weeks after the companies agreed the initial terms of a tie-up designed to challenge the dominance of Britain’s biggest banks. The purchase, which is set to catapult Nationwide into business banking and increase its share of the mortgage and savings market, is Debbie Crosbie’s boldest move since taking over as chief executive of the mutual in 2022. Under the terms of the transaction, Nationwide will pay 218p in cash for each share of Virgin Money and a final dividend of 2p, the companies said on Thursday.
/jlne.ws/3TqduFV

Quant Who Had to Shut Big Fund Bounces Back With Leaner One
Bei Hu – Bloomberg
Five years after shutting down Macquarie Asian Alpha Fund, a pioneer of quantitative hedge funds in the region with $2 billion at its peak, veteran fund manager Nick Bird is back. This time, he says, his fund will be smarter – and a lot smaller, on purpose. Bird now leads OQ Funds Management, which he started in Hong Kong with $15 million of his own money in June 2020. While that’s grown to around $500 million of assets under management, he’s determined to avoid the kind of over-expansion that led to the disappointing returns and the eventual closure of his fund at Macquarie.
/jlne.ws/43tWSC3

Yuanta ETF attracts $5.4bn in 5 days, smashing Taiwan record; Initial fundraising frenzy for local ETFs has sparked regulatory concerns
Sinyi Au – Financial Times
A new Taiwan equities high-dividend exchange traded fund from Yuanta Funds has raised about NT$170bn ($5.4bn) in five days, smashing the recently set initial ETF fundraising record. Taiwan’s Financial Supervisory Commission has confirmed that Yuanta, the market’s largest ETF provider, had set a new fundraising record, the third time it has been broken this month, amid a fundraising frenzy for local ETFs that has raised concerns from the regulator and the parliament.
/jlne.ws/3TpHpOM

Work & Management

IBM stock nears an all-time high-and it may have something to do with its CEO replacing as many workers with AI as possible
Marco Quiroz-Gutierrez – Fortune
IBM’s repositioning around AI may be paying off for its stock as it nears an all-time high amid its CEO’s ambitious plans for the technology. The company’s shares have skyrocketed 19% since the start of the year and closed at $193.96 on Wednesday, just 6% off of its all-time high of $206.31 from 2013. Year-to-date, shares of the technology company have outpaced all of the Magnificent Seven companies, excluding red hot chipmaker Nvidia and social media giant Meta.
/jlne.ws/43tXLdR

Goldman’s Woman Problem Just Keeps Getting Worse; CEO David Solomon’s lack of action on diversity speaks louder than words.
Beth Kowitt – Bloomberg Opinion
David Solomon, CEO of Goldman Sachs Group Inc., was hoping to take a victory lap. On Friday, the firm released his annual letter to shareholders, which he used to tout the successes of his five-year tenure: book value per share up about 50%, stock price up some 130% versus about 60% for its peer group, a quarterly dividend that has more than tripled. He proudly noted that the firm had raised more than $250 billion in alternative assets under management, beating its $225 billion goal a year early.
/jlne.ws/43s1NmK

Wellness Exchange

Can a ‘prescription’ for free fruits and vegetables improve health? Study after study say yes.
Aria Bendix – NBC News
If doctors prescribed fruits and vegetables like medicine, could people improve their health through diet alone? That’s the theory behind a growing number of programs in the U.S. that deliver free produce. These so-called produce prescription programs aim to combat heart problems and obesity-related diseases by either preparing free bundles of fruits and veggies for participants to pick up on a regular schedule, delivering fresh batches of produce to people’s homes or giving them money to buy produce.
/jlne.ws/43zwIxK

Taxpayers Were Overcharged for Patient Meds. Then Came the Lawyers.; A group of politically connected lawyers teamed up to go after insurers and made millions from one of the largest Medicaid settlements in history.
Shalina Chatlani – The New York Times
In 2018, when Mike DeWine was Ohio’s attorney general, he began investigating an obscure corner of the health care industry. He believed that insurers were inflating prescription drug prices through management companies that operated as middlemen in the drug supply chain. There were concerns that these companies, known as pharmacy benefit managers, or P.B.M.s, were fleecing agencies like Medicaid, the government-run health insurance program for the poor. Three years later, after Mr. DeWine became governor of Ohio, the state announced an $88 million settlement with one of the nation’s largest insurance companies, Centene.
/jlne.ws/4amSxCD

Regions

China Wants to Crush More Local Soybeans in Self-Reliance Push
Hallie Gu – Bloomberg
China may ask its soybean crushers to prioritize local supplies as the world’s top buyer seeks to reduce its reliance on imports. Beijing is discussing plans for some crushers to process specific amounts of local beans this year, according to people familiar with the matter. Domestic supplies can often be more expensive than imports, and the people said the government will subsidize any losses incurred by the companies.
/jlne.ws/3Vo3sbb

China’s annual nuclear power investment exceeds RMB 100 billion for the first time, and these stocks soar; The amount of this investment plan increased by 51.9% compared with the previous year and also set a new high since its listing.
Dai Jingjing – Jiemian News
The annual investment plan of China Nuclear Power Co., Ltd. (601985.SH, hereinafter referred to as China Nuclear Power) has reached a new high. On March 20, China Nuclear Power announced the meeting materials of the first extraordinary general meeting of shareholders in 2024. Among them, the “Proposal on the Company’s 2024 Investment Plan” mentioned that the total investment plan in 2024 is approximately 121.55 billion yuan, mainly for nuclear power and nuclear energy. Multi-purpose, new energy, single fixed asset investment projects and participation in capital injection and acquisition projects, etc.
/jlne.ws/3PwwW2y

Zimbabwe Lets Currency Free-Fall While It Weighs Gold Standard
Ray Ndlovu and Colleen Goko – Bloomberg
Zimbabwe, the poster child of hyperinflation, is allowing a free fall in its currency that it’s no longer keen to defend and is instead working on a new exchange rate potentially backed by gold. The country’s local dollar has weakened against the US dollar every day in 2024, sending the price of a single loaf of bread from Z$6,105 to Z$19,357 in a mere 11 weeks. Such a loss of purchasing power has historically pushed the central bank to intervene and arrest the slide, but this time, there has been no action.
/jlne.ws/4ahHPhr

EU index managers face funding risks as US moves to T+1; Rotations from European to US assets will need prefunding due to slower EU settlement
Paulina Pielichata – Risk.net
European index tracker fund managers may need short-term funding lines when the US switches to a one-day (T+1) settlement cycle on May 28, but possible solutions could have drawbacks of their own. The problem stems from the fact that European markets will remain on a T+2 cycle for now. If securities are sold in Europe and new securities bought in the US, this could leave an asset manager needing a day’s funding while they wait to receive the cash from the sale leg of the trade.
/jlne.ws/3IKQ8Gc

Miscellaneous

AN EMPIRE DIVIDED: The inside story of how GE CEO Larry Culp dismantled a 131-year-old American giant.
Brooke Sutherland and Ryan Beene – Bloomberg Businessweek
Big sheets of white paper line the perimeter of a meeting room at the General Electric Co. factory in Beavercreek, Ohio. Each sheet is scribbled on with markers and covered with neon Post-it notes outlining the steps needed to produce the tubes and ducts that will eventually be assembled into a jet engine. The vibe is more elementary school science fair than American industrial icon. But the simplicity is the point. Determining the layout for the Beavercreek facility was tricky: The revamped plant opened last year, combining components of production that had previously been spread out across eight different sites.
/jlne.ws/3Pul6WV

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