Lummis, Gillibrand Introduce Legislation for Digital Assets

Jun 9, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

Before I get to the IDX and AFM coverage, I have to share some news I learned that I had missed from May. Longtime industry executive Otto Nageli, a stalwart of the Swiss Futures & Options Association, has passed away. The news was shared by his family a week ago on his LinkedIn profile page. He passed away on the 5th of May at the age of 73. He was genuinely one of the nicest men in our industry, a pioneer who helped build the first electronic exchange in Switzerland and served the industry with intelligence, grace and humor. He will be missed.

JLN was lucky to interview Otto in Chicago and capture his story for The History of Financial Futures video series about how and why the first electronic derivatives exchange was created. Our goal is to capture these stories before the people who hold them and can share them disappear from our world. This was a case where we were able to do so, and Otto’s story is preserved, as it should be. Here is Part One and here is Part Two of our interviews with Otto. We had not released these videos previously.

The IDX charity gala last night on behalf of Futures for Kids was a success, raising over £40K, including the Most Interesting Man in the World of Futures, Pat Kenny, exceeding his goal of £10K for the Kilt Challenge. A donation from the AFM put Pat over the £10K mark. Pat was also re-elected as AFM chairman yesterday at the AFM’s Annual Meeting. Pat passed on the Kilt Challenge to ABN AMRO Clearing Bank Europe CEO Robert Booij, who is taller than Pat and is a 1930s Hollywood kind of handsome. He will be the first Dutchman to wear the kilt. There are also plans for a 2024 reunion of kilt wearers for the gala, where all former Kilt Challenge kilt wearers will appear again in a kilt at the event.

Speaking of the Kilt Challenge, it was hard to tell if Pat was coming or going last night as he had his kilt on backwards with the pleats in the front. He also had his kilt pin on his Prince Charlie jacket lapel until a proper kilt wearing Scotsman corrected him. That Scotsman was the originator of the Kilt Challenge, former FT reporter Jeremy Grant. Speaking of Jeremy, it turns out that he is second cousins with FIA Europe head Bruce Savage. I think it was because their grandmothers were sisters.

Overall IDX was a big success, getting the industry back together in London, having solid discussions about issues, getting high value speakers and raising money at a fund charity event at a lovely venue in Bishopsgate along the Thames. Walt Lukken and the FIA team did an excellent job throughout the event. My one complaint was there were not enough items at the charity auction to bid on that interested me. This is the first time I came home empty-handed without a piece of art of some kind from the event.

My AFM speech went well, though I would have preferred it if they had had a podium for my iphone, which I used as a teleprompter. It was a little unnerving looking out into the audience and seeing Patrick Young scowling at me everytime I looked his way. Actually, a scowl from Patrick is an improvement in our relationship.

The word is that the Trading Room at the Financial Times is going away and that Phillip Stafford, who has been its editor, will be named digital editor at the FT and will have a small team covering all things in the developing financial digital markets. The Trading Room was started by Jeremy Grant, then passed to Telis Demos for a short time before he jumped to the Wall Street Journal. Stafford then was assigned to the Trading Room and has done a nice job with it, though it has waned in recent years as exchange trading has lost the spotlight to the crypto world. I always considered the Trading Room FT’s attempt to do what JLN does, which I took as a compliment.


The FIA is holding a webinar called, “China’s FDL – Overview and Insights” on China’s Futures and Derivatives Law (FDL), the first law in China regulating futures and derivatives trading at a national legislative level. The webinar features Chin-Chong Liew, Partner, Linklaters; Ying Zhou, Counsel, Zhao Sheng Law Firm; and Simon Zhang, Counsel, Linklaters. It will be held Wednesday, June 22, 2022 from 3:00 p.m. – 4:30 p.m SGT/HKT. You can go here for more information and to register.~SR


ICE’s Elizabeth King Breaks Down OIC Diversity and Inclusion Panel, Talks ICE Progress

JLN interviewed Elizabeth King, president, ESG & chief regulatory officer of Intercontinental Exchange, at the 2022 Options Conference in San Antonio, Texas, about how her panel at the conference went, the subjects they discussed and other related topics.

Watch the video »


Should I Leave the US? Americans Get Second Passports With Tensions Rising
Devon Pendleton and Claire Ballentine – Bloomberg
US nationals, weary of polarized politics and the soaring cost of living, are taking up residency overseas — a role reversal for what’s long been considered one of the most powerful passports in the world.

***** My boss told me yesterday he’d buy me a one-way ticket to Bali. Maybe the universe is trying to tell me something (or my boss is). ~JB


Chicken on Track to Overtake Beef, Pork as Top Protein Source
Leslie Patton and Jasmine Ng – Bloomberg
For centuries, a delectable steak or pork loin has been the preferred top of the food chain for diners as societies grew more affluent and improved their diets. No longer. In 2022 chicken consumption is expected to reach 98 million metric tons, double the amount eaten in 1999. That’s more than three times the growth rate of pork and 10 times that of beef, according to US government data. Global chicken consumption is on track to account for 41% of all meat-eating by 2030. And in less than a decade, for better or worse, humans will for the first time consume far more chicken than any other kind of protein.

***** Beef consumption is down but beef seems to keep getting more expensive. I need to find my Econ 101 coursebook to get an answer to this puzzle. ~JB


Meta Hit With 8 Suits Claiming Its Algorithms Hook Youth and Ruin Their Lives
Users claim defective design, failure to warn of health issues
Company says it has improved supervision tools for parents
Malathi Nayak – Bloomberg
Meta Platforms Inc. is now a leader in another social media trend — lawsuits claiming the company built algorithms in its platforms that lure young people into destructive addiction.
Eight complaints filed in courthouses across the US over the last week allege that excessive exposure to platforms including Facebook and Instagram has led to attempted or actual suicides, eating disorders and sleeplessness, among other issues.

**** It’s an addiction like any other.~SR


Wednesday’s Top Three
Our top story Wednesday was Trafigura warns oil prices could reach ‘parabolic state’ in threat to economy, from the Financial Times. Second was the FIA’s announcement, FIA announces new board members, first female chair. Third was Critics take aim at ‘wild west’ carbon offset market, from the Financial Times.


MarketsWiki Stats
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MarketsWiki Statistics


Lead Stories

Lummis, Gillibrand Introduce Legislation for Digital Assets
Press Release via Traders Magazine
Bipartisan Responsible Financial Innovation Act Addresses CFTC And SEC Jurisdiction, Stablecoin Regulation, Banking, Tax Treatment Of Digital Assets, And Interagency Coordination, Including An Advisory Committee. Lummis-Gillibrand Focuses On Flexibility, Innovation, Transparency And Consumer Protections In Order To Integrate Digital Assets Into Existing Law And Provide Certainty To The Growing Industry.

Spac boom dies as wary investors retreat; Rising interest rates and the prospect of tougher regulation have deepened the challenges facing the market
Ortenca Aliaj, Joshua Franklin and Imani Moise and Owen Walker – FT
When Ginkgo Bioworks went public last September the US biotechnology group proved as irresistible to investors as it had to the Wall Street banks that helped make the listing happen. Propelled on to the public market after merging with a special purpose acquisition company set up by former Hollywood executives, Ginkgo shares surged in the first few weeks of trading.

Binance, the Wall Street of Crypto, Tries to Put Out a Big Fire; Cryptocurrency trading platform is in the spotlight as its CEO and founder’s fortunes dwindle.
Luc Olinga – The Street
It’s been a bad start to the week for Binance, the world’s largest cryptocurrency exchange by volume.=The platform is the subject of a barrage of bad news. The Securities and Exchange Commission recently opened an investigation into whether Binance Holdings broke securities-related rules when the firm launched its native BNB token as part of an initial coin offering (ICO) five years ago, Bloomberg reports. The SEC considers ICOs, which involve issuing virtual coins to raise money, as securities, which obliges their issuers to respect certain precise rules. Investigators are examining if the 2017 initial coin offering amounted to the sale of a security that should have been registered with the agency.

SEC chief launches review of ‘uneven’ US equities market; Gary Gensler’s plan to ‘do better for retail investors’ draws fire from brokers and trading firms
Nicholas Megaw and Madison Darbyshire – FT
The chair of the Securities and Exchange Commission has outlined plans for an overhaul of what he described as an “uneven” and unfair US equity market, drawing fire from traders that have flourished under the system.

Lummis-Gillibrand Crypto Bill Welcomed
Shanny Basar – MarketsMedia
Kristin Johnson, Commissioner at the Commodity Futures Trading Commission, said the framework for crypto regulation introduced by Senators Kirsten Gillibrand and Cynthia Lummis has done a good job of navigating between the responsibilities of the CFTC and the Securities and Exchange Commission.
Johnson spoke at the IDX conference hosted by FIA, the trade organization for futures, options and centrally cleared derivatives in London on 8 June.

Citigroup tech glitch revealed during markets stress in March 2020; US bank was given grace period for margin payment at Intercontinental Exchange
Imani Moise and Joe Rennison and Philip Stafford and Robin Wigglesworth – FT
Citigroup suffered a technology glitch at the height of the market panic over coronavirus that left it relying on the grace of an exchange clearing house to prevent the bank from defaulting on margin payments for derivatives contracts. The bank had a problem with payments technology that meant it was late to meet a margin call from a US clearing house run by Intercontinental Exchange in March 2020, according to several people familiar with the matter.

Credit Suisse CEO Dismisses ‘Stupid’ Question on Deal Rumors; Gottstein wont comment on reported interest from State Street; CEO says M&A advisory doing better, but equities ‘bleeding’
Myriam Balezou and Marion Halftermeyer – Bloomberg
Credit Suisse Group AG Chief Executive Officer Thomas Gottstein batted away questions on whether the bank is a takeover target and said he’s still holding out hope for a profitable second quarter.

History tells us UK interest rates will go up and up
Paul Lewis – Financial Times
Within hours of the Bank of England raising its main interest rate to 1 per cent in May and warning there would be more to come, mortgage lenders got busy pulling some of the crazy-low rates they had been offering.
Twitter was alive with people boasting they had secured a five-year deal at 1.2 per cent just days earlier. Almost overnight rates doubled, with financial markets judging the central bank would raise its main interest rate to 2.5 per cent within a year.

European Central Bank says it will raise interest rates for the first time in 11 years in July.
Eshe Nelson – NY Times
The European Central Bank entered into a new era on Thursday, as policymakers clearly stated their plan to raise interest rates next month for the first time in more than a decade.
To prepare for that move, the bank confirmed that it would stop growing its bond-buying program at the beginning of July.

Robinhood Executive Attacks SEC’s Plans to Shake Up Stock-Trading Rules
Alexander Osipovich – WSJ
A top executive with Robinhood HOOD -3.90% Markets Inc. blasted the Securities and Exchange Commission over its efforts to shake up the rules that govern U.S. stock trading, saying the market was functioning well for ordinary investors.
The comments from Robinhood Chief Legal Officer Dan Gallagher suggest that SEC Chairman Gary Gensler could have a tough time pushing through its plans, which grew out of last year’s frenzied trading in GameStop Corp. and other meme stocks.

Twitter Must Tackle a Problem Far Bigger Than Bots: Targeted Harassment
Tim Culpan – Bloomberg
For years, anyone covering China as a journalist, researcher or public policy maker has had to deal with the issue of trolls, fake accounts, copycats and harassment on social media like Facebook and Twitter. Recently it’s been getting worse, and for a growing number of female writers of Asian descent it has become particularly aggressive and malicious.

Hedge funds file complaint to LME over cancelled nickel trades
Philip Stafford – Financial Times
The lobby group for the world’s largest hedge funds has made a formal complaint to the London Metal Exchange, alleging the market operator failed to perform its regulatory functions when it cancelled thousands of nickel trades in March.

EBay Sellers Face 1099-K Tax Headache Under New IRS Rule
Arianne Cohen – Bloomberg
Small-business owners, prepare yourselves for the era of the 1099-K. That’s the tax form for disclosing transactions with services such as PayPal, Venmo, and Airbnb. Until this year, anyone with less than $20,000 in total payments typically didn’t get a 1099-K—and thus, in theory, could avoid paying taxes on money earned on such platforms. But since Jan. 1 those companies have been required to report gross payments of more than $600 directly to the Internal Revenue Service. That means small-business owners—as well as people who periodically empty their closets on EBay—will receive a 1099-K from any service provider where their income exceeds that amount.

Ukraine Invasion

Fear and Destruction Are Turning Ukraine’s Front-Line Cities Into Ghost Towns
Matthew Luxmoore – WSJ
For Vadim Lyakh, the mayor of this once bustling city now in Russia’s line of fire, every day feels like Groundhog Day.
“I wake up, clarify the damage caused by the latest shelling, check in with troops defending the city and visit civilians whose homes have been destroyed,” he said. “It’s the same, grim pattern.”

UN warns of hunger risk as talks stall over Ukraine grain blockade; Disputes persist over access to Black Sea port of Odesa as Kyiv fears more attacks
FT reporters
Hundreds of millions of people are at risk of “hunger and destitution” because of food shortages due to the war in Ukraine, the UN’s secretary-general has warned, as talks stalled over ending Russia’s blockade of Black Sea grain shipments.

Ukraine Latest: Russians Installed in Top Posts in Occupied Zone
Bloomberg News
Former Russian officials have been installed in top jobs in two occupied regions of eastern Ukraine, as the Kremlin tightens its grip on territories held by its forces. Russian troops are fighting to capture the city of Sievierodonetsk, and launched an offensive on Slovyansk, in an effort to take remaining Ukrainian holdouts in the east.

De-Mining Ukraine’s Ports May Take Months, UN Agency Says; Millions of tons of grain are stuck in ports in Ukraine; Negotiations to reopen ports are showing no signs of progress
Aine Quinn – Bloomberg
Removing sea mines near Ukraine’s key ports could take months, and hundreds of seafarers are still stranded in the region following Russia’s invasion of the country, according to the United Nations agency responsible for shipping safety.

Ukraine War: Hard Lessons Learned After 100 Days
Leonid Bershidsky – Bloomberg
Now that Vladimir Putin’s war on Ukraine is more than 100 days old and Ukraine fatigue is setting in for most people, I’m finally able to think more or less rationally about a calamity that has turned my world, and that of many like-minded Russians, upside down — though in a much less traumatic way, of course, than it has done for Ukrainians.

Exchanges, OTC and Clearing

Britannia Global Markets to Quit as Clearing Member of LME
Mark Burton and Archie Hunter – Bloomberg
Britannia Global Markets Ltd. will step down as a clearing member of the London Metal Exchange later this month, becoming the first dealer to withdraw from the bourse in the wake of an historic short squeeze in the nickel market.

American Financial Exchange® AMERIBOR® Term-30 And Term-90 Indexes Now Listed On The St. Louis Federal Reserve’s FRED Page
AFX via Mondovisione
The American Financial Exchange (AFX), an electronic exchange for direct lending and borrowing for American banks and financial institutions, announced that the Federal Reserve Bank of St. Louis’ FRED (Federal Reserve Economic Data) now carries daily price information and charts of the AFX AMERIBOR® Term-30 and Term-90 Indexes. FRED is the St. Louis Fed’s online database consisting of thousands of economic data time series from scores of national, international, public, and private sources.

SIX is partnering with Shard Capital to provide international custody services
SIX is delighted to partner with Shard Capital Partners LLP, the leading London headquartered wealth manager, to provide international Custody services.

Cboe Global Markets to Present at Morgan Stanley’s U.S. Financials, Payments & CRE Conference on Tuesday, June 14
Cboe Global Markets, Inc. (Cboe: CBOE), a leading provider of global market infrastructure and tradable products, announced today that Brian Schell, Chief Financial Officer and Treasurer, and Chris Isaacson, Chief Operating Officer, will present at Morgan Stanley’s U.S. Financials, Payments & CRE Conference on Tuesday, June 14, at 9:30am Eastern Time.

Eurex MSCI roll update: Total OI of over EUR 145 billion and calendar roll markets on ZTW and FMI
Eurex – Global home of MSCI derivatives
Eurex MSCI roll updates for last 7 days (May 30 – Jun 7)

The subtle art of not taking a risk
“The biggest risk is not taking any risk (…).” This quote by Facebook – now Meta – founder Mark Zuckerberg does not apply to everyone though. Especially not to Julia Martin and Germain Lefebvre, trainees in CCP Risk Management at Eurex Clearing: they thrive to become risk managers by completing a graduate trainee programme in this area – and therefore help to ensure the safety and integrity of our markets.

Equity index derivatives: Introduction of Futures on STOXX® Global Thematic Indices – Subsequent launch date
Eurex Circular 059/22 Equity index derivatives: Introduction of Futures on STOXX® Global Thematic Indices – Subsequent launch date

Enhancement of Incentive Programs for Commodity Derivatives Products in 2022
Reference is made to the circular dated 8 December 2021 (Ref: MKS/GCMD/003/21). Hong Kong Futures Exchange Limited (the “Exchange”) is pleased to announce enhancements to its existing Bundled Liquidity Providing Incentive Program for the Gold Futures contracts (“Enhanced Bundled Incentive Program”). The Bundled Liquidity Providing Incentive Program for the Silver Futures and London Metal Mini Futures contracts, details of which were specified in the circular dated 8 December 2021, remains unchanged and is included in this circular for completeness only.

Incentive Programs for Equity Derivatives Products Kong Futures Exchange Limited (the HKEX
“Exchange”) is pleased to announce the following incentive programs for equity derivatives products in the second half of 2022.

Primary Market Maker Program for Stock Options
The Stock Exchange of Hong Kong Limited (“The Exchange”) is pleased to announce the renewal with the following enhancements to the Primary Market Maker (“PMM”) Program with effective from 4 July 2022 (Monday), for a period of 1 year through 30 June 2023, inclusive.

Sergey Shvetsov elected Chairman of the Supervisory Board of the Moscow Exchange
On June 8, 2022, the first meeting of the Supervisory Board of the Moscow Exchange was held in the new composition, approved at the annual general meeting of shareholders on June 6, 2022.

Miami International Holdings and Lukka Enter into Strategic Alliance to Jointly Develop and Launch Crypto Derivatives
Miami International Holdings, Inc. (MIH), owner of Miami International Securities Exchange, LLC (MIAX®), MIAX PEARL, LLC (MIAX Pearl®), MIAX Emerald, LLC (MIAX Emerald®), Minneapolis Grain Exchange, LLC (MGEXTM), and Bermuda Stock Exchange (BSXTM), and Lukka Inc. (Lukka™) announced today that they have entered into a strategic alliance to jointly develop and launch a suite of proprietary crypto derivatives on MIH exchange platforms based on Lukka-supplied crypto data.

Investor Services Cell
Companies with highest number of complaints pending

Shanghai International Energy Exchange has released its Circular on the Delivery Issues of SC2207
The last trading day for the crude oil futures contract SC2207 is June 30, 2022, and the delivery dates are July 1, July 4, July 5, July 6 and July 7, 2022. Accordingly, Shanghai International Energy Exchange (hereinafter referred to as “the Exchange”) hereby notifies issues concerning delivery as follows:


Ex-Credit Suisse Boss Thiam Loses Pimco Backing for Fintech SPAC; Asset management giant walks away from Freedom Acquisition; Pimco selling stake in SPAC’s sponsor to China Bridge Capital
Ben Scent – Bloomberg
Tidjane Thiam, the former chief executive officer of Credit Suisse Group AG, has lost the backing of fund management giant Pimco for his fintech SPAC. Pimco, which was one of the financial backers behind the creation of Thiam’s Freedom Acquisition I Corp., has agreed to sell its entire stake in the sponsor vehicle for the blank-check firm to an affiliate of China Bridge Capital, according to a filing Wednesday.

Expensive DeFi Hacks Are the Price of Doing Business in Crypto; Attacks on decentralized finance are increasingly sophisticated — and threaten to send investors packing.
Victoria Vergolina – Bloomberg
In March of 2022, hackers stole about $600 million from a crypto network. It was one of the biggest exploits of this asset class to date, and left many investors shaken. Can a decentralized financial system work if investors get spooked when significant assets are lost? This episode features a roundtable discussion with Bloomberg reporter Olga Kharif and Bloomberg opinion columnist Parmy Olson about the scope and the effect these attacks are having on the decentralized financial marketplace.

ApeCoin Owners Vote Against Leaving the Ethereum Blockchain; 54% of ApeCoin owners voted to keep token on the blockchain; ApeCoin owners have been worried about Ethereum’s high fees
Olga Kharif – Bloomberg
ApeCoin owners have decided to keep the token, which is expected to be key to snagging exclusive metaverse game items and deals, on the Ethereum blockchain despite its high transaction fees. About 54% voted in favor of keeping the token on Ethereum, according to tracker Snapshot. Around 3.8 million tokens voted in favor of staying with 3.3 million against, Snapshot showed. A large chunk of the coins belongs to its creators including Andreessen Horowitz and Animoca Brands.

StoneX Group Launches StoneX Digital LLC | Investor Relations
Investor Relations | StoneX Group Inc.
StoneX Group Inc. (“StoneX”), a diversified global financial services firm providing execution, risk management and advisory services, market intelligence, and clearing services across multiple asset classes and markets around the world, today announced the launch of StoneX Digital LLC (“StoneX Digital”), a subsidiary dedicated to providing institutional clients with access to multiple products and services for digital assets. Brian Mulcahy, who joined StoneX in 2021 as Managing Director of Multi-Asset Business Development, will lead the StoneX Digital entity.

The Billionaires Behind a Push to Reinvigorate U.S. Chip-Making
A group that includes Eric Schmidt and Peter Thiel isn’t simply funding the effort itself: It wants American taxpayers to help foot the bill.
Ephrat Livni – NY Times
Amid the debate about how the United States can bring more manufacturing of semiconductors back to the country and worries it has become a national security concern, a surprising group of well-connected billionaires has quietly assembled to influence the way Washington approaches this thorny challenge.


Russian radio station owned by one of Putin’s ‘favourite oligarchs’ is HACKED and starts playing Ukrainian anthems and anti-war songs before it is swiftly pulled off air
Lizzie May – MailOnline
A Russian radio station which is owned by one of Vladimir Putin’s ‘favourite oligarchs’ was swiftly pulled off air after a hacker started playing Ukrainian anthems and anti-war songs. Kommersant FM was broadcasting their lunchtime news bulletin before suddenly being cut off by the Ukrainian military anthem ‘Oh the red viburnum in the meadow’.

The Most Overvalued Cybersecurity Startups — The Information
Aaron Holmes – The Information
Like other types of startups, cybersecurity software firms experienced a surge of investment and sky-high private valuations in recent years. Now that the party is beginning to peter out, security startups are bracing for a hangover.

CISA warning: Hackers are exploiting these 36 “significant” cybersecurity vulnerabilities – so patch now
Danny Palmer – ZDNet
The United States Cybersecurity and Infrastructure Agency (CISA) has added 36 new flaws to its catalog of vulnerabilities that are known to be exploited by cyber criminals.
The CISA alert warns that the vulnerabilities are a frequent attack vector for malicious attackers and pose “significant risk”. Organisations, particularly those associated with federal government, are urged to apply the security updates as soon as possible.

Behavioral cybersecurity platform CybSafe raises $28M Series B led by Evolution Equity Partners
Mike Butcher – TechCrunch
Last year, UK cybersecurity startup CybSafe, a “behavioral security” platform, raised a $7.9 million in a Series A. This SaaS product with a per-user-based, subscription licensing model has a “behavior-led” platform that manages people-related security. In other words, it uses behavioral science and data analytics to help employees be more cybersecurity aware.
Users get microlearning content and personalized ‘nudges’ in nine different languages, delivered via a mobile application or browser.

Cybersecurity hiring momentum ramps up
Security Magazine
The search for cybersecurity talent continues to accelerate across the U.S. economy, with cyber job postings growing at more than twice the rate of today’s overheated job market, according to new data from CyberSeek, a joint initiative between the National Initiative for Cybersecurity Education (NICE), Emsi Burning Glass and CompTIA.


Crypto In-the-Money Traders Dwindle, Hinting at Capitulation
Vildana Hajric – Bloomberg
More crypto traders are finding their Bitcoin investments underwater and may be ready to throw in the towel.
The number of anonymous Bitcoin addresses in the money, meaning those that acquired their holdings at prices below today’s, has reached lows not seen since March of 2020, according to Bequant, a digital-asset firm. The level, currently hovering around 51%, “points to capitulation,” though bear markets in 2015 and 2018 saw even lower lows, wrote Martha Reyes and Emiliano Bruno in a note.

Binance, the Wall Street of Crypto, Tries to Put Out a Big Fire
Luc olinga – TheStreet
It’s been a bad start to the week for Binance, the world’s largest cryptocurrency exchange by volume.
The platform is the subject of a barrage of bad news.
The Securities and Exchange Commission recently opened an investigation into whether Binance Holdings broke securities-related rules when the firm launched its native BNB token as part of an initial coin offering (ICO) five years ago, Bloomberg reports.

Ethereum (ETH) Merge Moves Closer After Successful Milestone Test
Ethereum, the world’s most used cryptocurrency blockchain network, passed a milestone test ahead of a highly anticipated technical upgrade without any major glitches.

Tether Launches Stablecoin on Tezos to Unlock New DeFi Products; Tether’s USDT, the world’s largest stablecoin by market capitalization, is now available on the Tezos proof-of-stake blockchain.
Andrew Asmakov – decrypt
Stablecoin operator Tether today announced it is expanding the list of blockchain networks supporting its flagship stablecoin USDT to Tezos, a proof-of-stake (Pos) platform for creating smart contracts and decentralized applications (dApps).

Tether Cedes Territory to Rival Stablecoins as Crypto Investors Diversify
Competitors have added users since the world’s largest stablecoin briefly broke from its $1 peg
Vicky Ge Huang – WSJ
A tumultuous spring in cryptocurrencies is remaking the pecking order among so-called stablecoins, which serve as a bridge between crypto and government-issued money.
Tether is the best-known and most widely traded stablecoin—a breed of cryptocurrency that purports to offer a reliable conversion to and from dollars at a fixed price. After Tether fell from its $1 peg to 95 cents on May 12, investors redeemed $10 billion in the weeks that followed.

Can crypto help Afghans? Some think so; Crypto enthusiasts say it’s the only solution to the cash crunch that was created when the Taliban took over.
Ali M Latifi – Aljazeera
Kabul, Afghanistan – The first time Sulaiman Bin Shah used crypto was as a Fulbright scholar in California. He had been hearing about the decentralised coins for some time and wanted to try them out.

Ethereum Nerd-Sniping: A Conversation With Veteran Dev Ben Edgington on the Merge and Boring Day Jobs
Matthew Leising – DeCential
As droves of executives on Wall Street and in corporate life have abandoned their safe roles for a gamble in the nascent blockchain and web3 space, a touch of a midlife crisis and boredom with one’s job is surely a driving factor.
Say you led the engineering and product management team within the information systems group for Hitachi in the UK, as Ben Edgington did for more than six years. He’d been with the Japanese electronics manufacturer for almost two decades by then when, in 2016, he discovered the Ethereum blockchain and a plan to change how the network achieves agreement called proof of stake.

Celebrity NFTs: What do Justin Bieber and Madonna have to disclose to fans?
Victoria Vergolina – Bloomberg
Did you know that both Madonna and Justin Bieber own expensive digital images of apes? It’s true: Bored Apes and other nonfungible tokens are a must-have celebrity accessory these days. But should you put your trust in movie stars, pop singers and athletes when it comes to crypto? What are some of the legal questions at play with these celebrity endorsements? Bloomberg reporter Misy Egkolfopoulou stops in for a look at what’s behind the buzz with celebrities’ interest in crypto investments.

Tether Cedes Territory to Rival Stablecoins as Crypto Investors Diversify
Vicky Ge Huang – WSJ
A tumultuous spring in cryptocurrencies is remaking the pecking order among so-called stablecoins, which serve as a bridge between crypto and government-issued money.
Tether is the best-known and most widely traded stablecoin—a breed of cryptocurrency that purports to offer a reliable conversion to and from dollars at a fixed price. After Tether fell from its $1 peg to 95 cents on May 12, investors redeemed $10 billion in the weeks that followed.


America is two nations barely on speaking terms; The spirit of Watergate will be missing from audiences for the televised January 6 hearings
Edward Luce – FT
What should we make of the fact that America’s TV channels all carried the live jubilee festivities of an elderly monarch but will part ways on this week’s hearings into an assault on US democracy? The light-hearted take is that the British crown is above politics, including in America. The darker interpretation is that the survival of US democracy itself is now a partisan issue.

Biden Administration to Set Rules of the Road for Charging Electric Vehicles
Proposed regulations would require charging stations built with federal dollars to be located no more than 50 miles apart.
Lisa Friedman – NY Times
Electric vehicle charging stations built with federal dollars should be positioned along Interstates every 50 miles, be able to recharge cars quickly and be located no more than a mile from a major highway, according to new rules proposed by the Biden administration on Thursday.
“EV drivers should be able to count on finding a place to recharge easily wherever they go,” Transportation Secretary Pete Buttigieg told reporters Wednesday.


Congress’s Big Tech Crackdown Quickens With Rare Show of Unity
Alicia Diaz and Maria Curi – Bloomberg
A bipartisan group of lawmakers defended a bill to rein in big technology companies, signaling that momentum is building for the first major piece of legislation to curb the power of giant online platforms.

Lina Khan vows ‘muscular’ US antitrust approach on private equity deals; FTC chair warns of ‘life and death consequences’ when buyout groups own broad sectors of economy
Stefania Palma and Mark Vandevelde and James Fontanella-Khan – FT
US antitrust regulator Lina Khan has vowed to take a muscular approach to regulating private equity dealmaking, warning of “life and death consequences” when buyouts place large sections of the economy under the control of Wall Street.

SEC Reopens Comment Period for Proposed Rule on Recovery of Erroneously Awarded Compensation
The Securities and Exchange Commission today reopened the comment period on proposed rules for listing standards for recovery of erroneously awarded compensation, and the staff of the Commission released a memo that contains additional analyses and data that has the potential to be informative for evaluating the proposals.

SEC Charges CohnReznick LLP and Three Partners with Improper Professional Conduct
Firm’s auditing deficiencies caused misleading disclosures by two clients prior to their bankruptcies and delistings

The Critical Importance of the General Standard of Auditor Independence and an Ethical Culture for the Accounting Profession
SEC – Paul Munter, Acting Chief Accountant
High-quality audits are critical to the process of providing decision-useful financial information for the benefit of investors, and auditors[2] serve an important gatekeeping and investor protection function by helping to ensure that issues are promptly identified and addressed.[3] The Commission has long-recognized that audits by professional, objective, and skilled accountants that are independent of their audit clients contribute to both investor protection and investor confidence in the financial statements.[4] As such, the Commission’s auditor independence rule is integral to its mandate to protect investors and is fundamental for promoting investor confidence in the quality of financial disclosures. Rule 2-01 of Regulation S-X sets forth the Commission’s auditor independence requirements and emphasizes the importance of an accountant’s independence from its audit client in both fact and appearance.[5]

Market Structure and the Retail Investor:” Remarks Before the Piper Sandler Global Exchange Conference
SEC – Chair Gary Gensler
Thank you, Rich (Repetto), for that kind introduction. It is good to be with you again. As is customary, I’d like to note my views are my own, and I’m not speaking on behalf of my fellow Commissioners or the SEC staff.

ASIC releases Information Sheet on warnings and reprimands given to financial advisers
The requirement for ASIC to give warnings and reprimands to financial advisers in specified circumstances was introduced by the Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021 (Better Advice Act).

ESMA risk assessment update: market environment deteriorates further
Risk analysis & economics – markets infrastructure investors
The European Securities and Markets Authority (ESMA), the EU securities markets regulator, today updates its risk assessment to account for the impacts on financial markets of Russia’s invasion of Ukraine and the deteriorating economic environment.

FCA appoints members for new Secondary Markets Advisory Committee
We have appointed the members of our new advisory committee on secondary markets for a period of two years until 1 June 2024.

International Financial Center Initiatives
FSA Japan
Japan as an International Financial Center

Singapore Green Bond Framework Introduced for Upcoming Inaugural Singapore Sovereign Green Bond Issuance
Singapore Green Bond Framework to establish guidelines for green bond issuances by the public sector
The Singapore Government today published the Singapore Green Bond Framework (Framework), a governance framework for sovereign green bond issuances under the Significant Infrastructure Government Loan Act 2021 (SINGA). The Framework details the Singapore Government’s (i) intended use of green bond proceeds, (ii) governance structure to evaluate and select eligible projects, (iii) operational approach to manage green bond proceeds, and (iv) commitment to post-issuance allocation and impact reporting.

Speech by Ms Indranee Rajah, Minister in the Prime Minister’s Office, Second Minister for Finance and National Development, at the Singapore Sustainable Investing and Financing Conference, on 9 June 2022
MAS – Mr Lim Boon Heng, Chairman, Temasek Holdings

Court orders Maxim Capital Limited and Maxim Trader to pay investors
Securities and Futures Commission – Hong Kong
The Court of First Instance has ordered Maxim Capital Limited (Maxim Capital) and Maxim Trader to pay investors in connection with investment schemes they operated following legal proceedings brought by the Securities and Futures Commission (SFC) under section 213 of the Securities and Futures Ordinance (SFO) (Note 1).

Statistics of Credit Card, Cash Card & Electronic Payment Institutions Business Operation as of April 2022
FSC China

Investing and Trading

Yen at 150 May Risk Rerun of Asia Financial Crisis, O’Neill Says; China doesn’t want weak yen to threaten its economy, he said; ‘I can’t see Japan sticking to yield curve control’: O’Neill
Tania Chen – Bloomberg
The yen’s slide may spark turmoil on the scale of the 1997 Asian Financial Crisis if it declines as far as 150 per dollar, veteran economist Jim O’Neill said. A slump of that magnitude may convince China to intervene in the currency market to protect its own flagging economy and it would be perfectly rational for it to do so, he said in an interview last month that he affirmed on Thursday.

Carlos Slim Cashes In on US Oil Refiner’s 600% Pandemic Rebound; The billionaire and his family have sold $358 million of PBF Energy this year.
Benjamin Stupples and Andrea Navarro – Bloomberg
Carlos Slim and his family are pocketing the profits from boosting their stake in a US oil refiner during the pandemic. Control Empresarial de Capitales, the family’s investment vehicle, has sold about $358 million of PBF Energy Inc. this year, halving its holding in the Parsippany, New Jersey-based company, according to data compiled by Bloomberg. It unloaded $90 million of shares last week, leaving the Slims with a 9.7% stake worth about $500 million.

Global Wealth Hit Record High of $530 Trillion in 2021; Asian wealth is growing faster than in any other region; World’s wealth set to keep rising despite economic headwinds
Tom Metcalf – Bloomberg
Global wealth rose 10.6% last year to reach a record high of $530 trillion in 2021 and is set to continue rising in all regions despite inflationary pressures and Russia’s invasion of Ukraine. Strong equity markets and a surge in demand for real assets such as property, wine and art drove the increase, according to a report by Boston Consulting Group. About $80 trillion of new wealth is likely to be created over the next five years.

Leveraged Loans Become Pricey, Robbing Buyout Boom of Momentum
Volume of financing slips as Federal Reserve raises interest rates to curb inflation and stocks trade well below recent highs
Laura Cooper – WSJ
The debt-fueled buyout boom is running out of steam, as attractive financing for LBOs gets harder to come by.
After enjoying low-cost debt for years, private-equity firms are finding it more expensive to secure funding in the leveraged-loan market, the source of most of the capital they use to fund takeovers. The average yield to maturity on loans backing new leveraged buyouts has increased from roughly 5% last year to 5.7% so far this year, according to Leveraged Commentary & Data. Plans by the Federal Reserve to continue raising interest rates threaten to make the debt more expensive still.

Environmental, Social and Corporate Governance

Canada’s oil sands: why some of the world’s dirtiest fuel is now in hot demand; Can America’s biggest oil supplier grant energy security to the US without derailing its climate commitments?
Derek Brower – FT
When Joe Biden scrapped a permit for the huge Keystone XL pipeline just hours after entering the White House last year, a death knell seemed to be ringing for Canada’s oil sands, by far the largest supplier of foreign oil to the US.

Fire at US natural gas plant deals blow to exports; Freeport LNG terminal in Texas closed for at least three weeks as Europe seeks to cut Russia dependency
Myles McCormick – FT
One of the biggest US liquefied natural gas plants will be closed for at least three weeks after an explosion, dealing a blow to exports at a time when the industry is trying to boost supplies to Europe. Freeport LNG said on Wednesday that it had been forced to halt its operations, which account for almost a fifth of US liquefaction capacity, a process by which natural gas is supercooled and loaded on to tankers for delivery overseas.


The Wall Street gravy train is over: After a year of perks and raises, junior bankers are facing competition and job cuts
Reed Alexander – Business Insider
Junior investment bankers seized power from their bosses on Wall Street last year; Firms rolled out salary raises and perks as droves of junior bankers flocked from the industry; But industry experts warn that an economic slowdown could spell the undoing of their victories.
Junior investment bankers mounted a power play that sent shockwaves across Wall Street last year.

Credit Suisse CEO Calls Takeover Talk ‘Really Stupid’
Margot Patrick – WSJ
Credit Suisse CS -1.31% Group AG Chief Executive Thomas Gottstein said a report that the bank could be taken over by State Street Corp. STT 1.29% was “really stupid” and that it can repair itself.
The CEO is under pressure from investors to show that the bank has a credible strategy after a spate of scandals and financial losses. On Wednesday, Credit Suisse warned it is likely to report its third consecutive quarterly loss because of a sharp fall in investment-banking deals such as companies raising new stock and bonds. It said it would speed up cost-cutting plans.

Germany’s LBBW licenses STOXX global Paris-aligned decrement index for structured products Qontigo
Germany’s Landesbank Baden-Württemberg (LBBW) has licensed the iSTOXX® Global Climate Change ESG NR Decrement 4.5% from STOXX Ltd., Qontigo’s index provider, an index that complies with the European Union Climate Benchmarks regulation, to issue structured products.

Apple sidelines Goldman Sachs and goes in-house for lending service; Apple Pay Later will offer loans via new subsidiary instead of financing through a bank
Tim Bradshaw and Siddharth Venkataramakrishnan and Imani Moise, Joshua Franklin and Gary Silverman – FT
Apple is making its biggest move into finance by offering loans directly to consumers for its new buy now, pay later product, taking on a role played in its other lending services by banking partners such as Goldman Sachs. Short-term loans made through the iPhone maker’s new Apple Pay Later service, announced on Monday, will be made through a wholly owned subsidiary, Apple Financing LLC, the company said.

Wellness Exchange

U.S. Prepares to Distribute Covid-19 Shots to Children Under 5
Vaccinations could begin later in June if shots from Moderna and Pfizer are authorized by FDA
Stephanie Armour – WSJ
The Biden administration is gearing up to roll out vaccines for children under age 5 in conjunction with educational and outreach efforts, if the shots are approved by federal regulators.
Vaccinations for children under age 5 could begin as soon as June 21 if the shots from Moderna Inc. and Pfizer Inc. and partner BioNTech SE are authorized by the Food and Drug Administration. Ten million initial doses will be made available, senior administration officials said.

Hong Kong’s Covid Cases Top 600 as Sub-Variant Infections Flare
Linda Lew – Bloomberg
Hong Kong reported more than 600 coronavirus cases for the first time in seven weeks as infections linked to bars and schools swell, while officials warned that omicron sub-variants continue to spread.
The city announced 674 cases, the highest since mid-April. Health officials said Thursday they had found one suspected new case of BA.4 or BA.5, who may have been infected during their work at a quarantine hotel, as well as seven new suspected cases of the BA.2.12.1 sub-variant.

Shanghai to conduct mass COVID testing in 7 of its 16 districts at weekend
The Chinese commercial hub of Shanghai will carry out mass testing for COVID-19 in seven districts over the weekend, a local health official said on Thursday.


Hong Kong invites global financiers to two-day November summit in much-heralded bid to reclaim city’s spot in world finance
Enoch Yiu – South China Morning Post
Eddie Yue Wai-man, the chief executive of the Hong Kong Monetary Authority (HKMA), has personally invited more than 100 of the world’s top bankers, fund managers and financial executives to a summit on November 1 and 2, according to three sources familiar with the plan. HSBC, Standard Chartered, Citigroup, BlackRock and JPMorgan Chase are among the invitees, the sources said.

Junior Bankers Leave China Merchants’s Investment Banking Arm; At least five bankers have left CMBI in recent weeks; Job security concerns grow as deals in Greater China dry up
Bloomberg News
At least five Hong Kong-based bankers have left CMB International Capital Corp. in recent weeks, according to people familiar with the matter, as the war in Ukraine and an uncertain economic outlook hammer global capital markets. Two vice presidents and some associates have departed, said the people, requesting not to be identified because the matter is private. A representative for CMBI declined to comment.

US Sees China Setbacks as Opportunity for Pentagon Chief Austin’s Singapore Trip
American officials increasingly see China losing diplomatic ground in Asia as Pentagon chief Lloyd Austin heads to Singapore for a regional security forum that will include a meeting with a top Chinese defense official.

Fertiliser costs could prolong global food tensions – FAO
Spiralling costs for farm inputs like fertiliser could deter growers from expanding production and worsen food security in poorer countries facing record import bills, the United Nations’ food agency said on Thursday.

Hybrid Work Is Here to Stay as London Staff Value Time at Home More Than Office
Damian Shepherd and Jo Constantz – Bloomberg
The verdict is in: Londoners enjoy and value working from home and don’t see a future that includes a return to the old five-day office week, no matter what politicians, their bosses or the media say.


What Bosses Lost in the Fight Against Empty Offices: Leverage
Employer plans have played out like a game of chicken. Now workers are rebelling outright, and executives are trying everything to make the office worth it.
Emma Goldberg – NY Times
What Barrett Kime’s boss said on the recent video call was straightforward. Could members of his team at NBCUniversal show up on the few days a week that they were actually expected to be in the office?
Rebellion ensued. Mr. Kime, a senior creative director, took himself off mute. “I was talking about how it was insane to ask people to come in more often with Covid raging,” he recalled.

From the South Side to the Loop, Chicago’s Innovative Spirit Thrives
Theater, art and music are flourishing, and on the culinary scene, a 13-course Filipino tasting menu and a sleek Black-owned winery in Bronzeville are just a few of the city’s new offerings.
Elaine Glusac – NY Times
Lacey Irby and her business partner, Ryan Brosseau, a chef, were planning to open a restaurant when the pandemic hit. It delayed them, but eventually, in early 2021, they opened Dear Margaret, a homey tribute to Mr. Brosseau’s Canadian grandmother in the Lakeview neighborhood, with takeout only, gradually adding patio dining and finally, last June, the snug dining room. It recently earned a Bib Gourmand award from Michelin — signaling quality and value — and reservations are scarce.

We visit more than 100 financial news websites daily (Would YOU do that?)

The Spread

Past JLN Newsletters

Crypto: ‘Blockchain is hype’ – MPs warned

Crypto: ‘Blockchain is hype’ – MPs warned

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...

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