Silicon Valley Wins as SEC Allows Direct IPOs to Raise Cash; SEC Charges Ripple and Two Executives with Conducting $1.3 Billion Unregistered Securities Offering

Dec 23, 2020

First Read

$18,961/$300,000 (6.3%)

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In the Georgia Senate Elections There Is No Winning With Your Reputation Intact
John Lothian – John Lothian News

In the Georgia Senate Elections There Is No Winning With Your Reputation Intact
John Lothian News
Kelly Loeffler began 2020 by becoming Sen. Kelly Loeffler. When she aspired to be a Georgia U.S. Senator, I am sure she never imagined she would be in the midst of a national fight for political control of the U.S. Senate. But that is where she has found herself.

Because of the high stakes for Senate control, she is in the eye of a storm turning over Georgia. Amidst the twirling, swirling of the campaign, there is mud flying everywhere. Some of this mud sticks, some of it washes right off with a little rain and some sunlight.

Sometimes it seems like there are two twisters over Georgia, one is her fight with Rev. Raphael Warnock and the other is the fight of incumbent Sen. David Perdue with challenger Jon Ossoff.

To read the rest of this commentary, go here.

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Hemp’s Future Twists and Turns Go Beyond Current CBD Marketplace
Thom Thompson – John Lothian News

Our friends at PanXchange have included, along with their usual invaluable market insights, a year’s-end forecast to get us started thinking about 2021 in their December Hemp: Benchmarks & Analysis report.

A quick spin around the report’s data and graphs shows that the CBD markets still seem glutted, that is, if we look at the prices for CBD biomass, distillates and isolate that PanXchange reports are stuck in the basement.

Retail prices for products in which CBD is the key ingredient have yet to respond much to the fall in the ingredient’s price. Since legalization, most hemp has been grown to produce CBD and CBD is hemp’s biggest conundrum.

Read more of this analysis here.

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Hits & Takes
John Lothian & JLN Staff

The JLN team wishes you happy holidays. For those of you who celebrate Christmas, we wish you Merry Christmas. We hope the spirit of the season of hope, peace, love and joy surround you and your loved ones for now and the coming new year.

We will be publishing JLN tomorrow, but not on Friday, Christmas Day. We will publish JLN every day between the holidays, but not on New Year’s Day. We will not be publishing JLN Options between the holidays.

I don’t like to write about politics, but I felt compelled to do so as I felt our industry was being unduly misrepresented by the criticism of Sen. Kelly Loeffler’s trading history. So I wrote about it. See the link above for my commentary.

Scott Knudsen of Cove Traders says it is not too late to get into crypto and his firm has a position available for a back-end engineer.

The new bill passed by Congress gives a second draw of PPP loans/grants to firms that can show a quarter in 2020 that was down 25% or more than 2019. Firms also must have 300 or less employees. The Wall Street Journal has written a nice Q&A about the bill and the PPP program elements it includes.

My family would generally go to a late-night Christmas Eve church service at our home church. When we were younger, sometimes we would go back to the church in Glenview, where Cheryl and I met and we both sang in the choir. This year is unique because of the pandemic. Not only will be watching the virtual service for our church, St. Peter’s in Elmhurst, Illinois, but we will also be able to watch the other services in town or our old home church as the services will all be available online and will be recorded for replay at any time. It is a very unique opportunity to hear the Christmas message from a variety of ministers and churches.

Alas, we have had no new donations to the JLN GoFundMe campaign yesterday. Support our efforts to preserve industry history by giving to our GoFundMe campaign.

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

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Ripple is being sued by the SEC for selling XRP without registering it as a security. The company has been around for a long time, so it’s interesting the SEC chose now to file the suit. Perhaps it’s because Ripple has been making a big push to sell lots of XRP this year. Despite remaining one of the top cryptocurrency companies by market cap for years, XRP has been struggling to maintain its price point and market cap.~MR

It’s almost time to turn that calendar to 2021! January is starting to fill up. At the end of next month, on January 27, the FIA is hosting its 2020 Annual Trends in Futures and Options Trading webinar presentation. Registration information is here. ~SC

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In Coronavirus Relief Bill, Congress Also Curbs Surprise Medical Bills : Shots
Julie Appleby – NPR
Most Americans tell pollsters they’re worried about being able to afford an unexpected medical bill.
Late Monday, Congress passed a bill to allay some of those fears. The measure is included in a nearly 5,600-page package providing coronavirus economic relief and government funding for the rest of the fiscal year.
Specifically, the legislation addresses those charges that result from a long-running practice in which out-of-network medical providers — from doctors to air ambulance companies — send insured Americans “surprise bills,” sometimes for tens of thousands of dollars.
/n.pr/34GD1lL

******5,000 pages long. There is a lot of fat and pork no doubt, too.~JJL

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The ‘Darkest Days’ Are Ahead Of Us, Biden Warns About COVID-19 Pandemic
Domenico Montanaro – NPR
President-elect Joe Biden warned Tuesday that the coronavirus pandemic will get worse before it gets better. “Our darkest days in the battle against COVID are ahead of us, not behind us,” Biden told reporters during a year-end news conference in Wilmington, Del. He said that Americans, when united, could overcome the crisis, and he called the first vaccines being administered a good thing. But he noted that distribution of the vaccines is one of the biggest operational challenges the country has ever faced.
/n.pr/3rn9CGR

*****The winter solstice was earlier this week. I hope that is what he was talking about.~JJL

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IOSCO publishes report on education of retail investors regarding risks of
crypto-assets
IOSCO
The Board of the International Organization of Securities Commissions today published a report that seeks to help regulators inform retail investors about the risks and characteristics of crypto-assets. Crypto-assets carry risks that retail investors may not fully understand, increasing the chance of losses on investments in these assets. The IOSCO report titled Investor Education on CryptoAssets identifies an array of possible risks to investors, including such things as lack of market liquidity, volatility, partial or total loss of the invested amount, insufficient information disclosure and fraud.
/bit.ly/2WDUC9o

******It is crypto’s day at IOSCO.~JJL

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Restoring trust: 5 steps to reduce congressional conflicts of interest
Ty Gellasch – Brookings
It’s past time for Congress to limit trading and outside business activities for its members and staff. Our Democracy is undermined when the public questions whether government officials are personally profiting off of their government positions. Unfortunately, we have seen members of Congress trading extensively in stocks while also holding hearings, writing laws, and funding regulators that directly impact those stocks’ prices. And we have seen outside business interests of Democrats and Republicans benefit from federal programs and activities. Both financial trading and outside business activities present clear conflicts of interest that undermine trust in those officials and in government overall. Both should be limited far more than they are today.
/brook.gs/37KQ0og

*****Timely piece from Brookings.~JJL

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The 12 days of Christmas for canny investors; From partridge to drummers, a seasonal guide to plum funds
Moira O’Neill – FT
It might be tempting to splurge on Christmas gifts and treats, especially if this particularly bleak midwinter sees you far from loved ones or feeling lonely, and you have surplus funds sitting in the bank.
/on.ft.com/34GEubL

*****A different look at the 12 days of Xmas gifts.~JJL

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Tuesday’s Top Three
The top story on Tuesday was The New York Times’ feature profile of a now-familiar subject, Kelly Loeffler, a Wall Street Senator With a Hardscrabble Pitch. The number two story was more industry specific, CFTC Grants OneChicago LLC Request to Vacate DCM Designation. Number three was the most unusual, a photo of MaterialsXchange staff in the middle of LaSalle Street in Chicago.

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MarketsWiki Stats
195,557,133 pages viewed; 24,755 pages; 227,509 edits
MarketsWiki Statistics

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CryptoMarketsWiki Website»
CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages

Recently updated pages include
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Lead Stories

Silicon Valley Wins as SEC Allows Direct IPOs to Raise Cash
Benjamin Bain and Crystal Tse – Bloomberg
NYSE plan could upend decades-long process for stock listings; Critics say the change erodes crucial investor protections
Hot tech companies and other startups will soon be permitted to raise money on the New York Stock Exchange without paying big underwriting fees to Wall Street banks, a move that threatens to upend how U.S. initial public offerings have been conducted for decades.
/bloom.bg/3nK72bV

SEC Charges Ripple and Two Executives with Conducting $1.3 Billion Unregistered Securities Offering
SEC
The Securities and Exchange Commission announced today that it has filed an action against Ripple Labs Inc. and two of its executives, who are also significant security holders, alleging that they raised over $1.3 billion through an unregistered, ongoing digital asset securities offering.
/bit.ly/37J0nt5

China launches bid to become commodities market player
Benoît Pelgrin – Yahoo News
China, a big raw materials consumer, hopes to position itself as a global commodities marketplace with its launch of a new futures contract on the popular copper market. The Shanghai International Energy Exchange (INE), a division of the Shanghai Commodity Exchange, opened the contract for the so-called eternal metal to foreign investors on November 19, following several trial runs — including one in oil — in 2018.
/yhoo.it/3pk2lG5

SEC Approves NYSE’s Plan for New IPO Alternative; Proposal lets companies raise capital through direct listings
Alexander Osipovich – WSJ
The Securities and Exchange Commission will allow companies to raise capital through direct listings, opening the door to a new alternative to the traditional initial public offering. The SEC approved the new kind of direct listing—which could help startups save on bank fees and capture more of the gains in their share price when they go public—in an order posted on its website Tuesday.
/on.wsj.com/3mK4BVs

Money market funds need reform to prevent runs, US regulators say; Report on March volatility argues post-financial crisis changes did not fix the problem
Colby Smith – FT
A group of powerful financial regulators have called for sweeping reforms to US money market funds after the $4.9tn industry showed signs of severe strain during the market turmoil in March.
/on.ft.com/3mLxnVy

Ripple Labs, Executives Sued by SEC for Failing to Register XRP
Chris Dolmetsch – Bloomberg
Ripple Labs Inc. and its top executives were accused by the U.S. Securities and Exchange Commission of misleading investors in XRP, the world’s third-largest cryptocurrency, by selling more than $1 billion of the virtual tokens without registering with the agency. Ripple co-founder Christian Larsen and Chief Executive Officer Bradley Garlinghouse “created an information vacuum” that allowed them to sell XRP into a market that only had information they chose to share, the SEC said in a lawsuit filed Tuesday in New York. The two men ignored legal advice that the cryptocurrency could be considered an investment contract and therefore was a security, the agency said.
/bloom.bg/37JbYYX

Robinhood User Says $300,000 Restored From Hack, Then Taken Back
Sophie Alexander and Anders Melin – Bloomberg
Customer says account attacked, money lost in options trades; Malware is an issue in a small number of cases, company says
Gangti Zhu, a Maryland retiree, says he put almost his entire life savings into a Robinhood Markets account this year, only to lose about $300,000 in a hack. He describes the same painstaking experience that other users have encountered: a panicked search for a phone number, a slew of emails after finding there’s no emergency line and then relief when the money was finally returned to his account.
/bloom.bg/3mS9Typ

PPP is Reopening. What’s Different This Time? Second small-business loans will be limited to borrowers with 300 or fewer employees who can show revenue was hurt by the pandemic
Amara Omeokwe – WSJ
The Paycheck Protection Program is getting a reboot as part of Congress’s latest coronavirus stimulus package. The $900 billion deal includes $284 billion for PPP, which will reopen after closing in August. Much like the program’s first iteration, the aid will be in the form of forgivable loans to small firms, but there will be some key changes on issues such as eligibility for second-time applicants and types of forgivable expenses. Here’s what we know so far.
/on.wsj.com/37L7iSy

U.S. Treasury-led report calls for overhaul of money market funds
Pete Schroeder, Kate Duguid – Reuters
U.S. policymakers need to consider major changes to make money market funds less vulnerable to investor runs, a working group led by the Treasury Department said on Tuesday, stopping short of making specific recommendations.
/reut.rs/2M455cn

The Covid Recovery Must Begin With Climate Action; The mayors of Boston and New Orleans argue that green infrastructure is critical to surviving both the climate and coronavirus crises.
Martin J. Walsh and LaToya Cantrell – Bloomberg
Global pandemics and deadly climate disasters should be once-in-a-generation crises. But in 2020, U.S. mayors from coast to coast have been forced to confront both. New Orleans experienced its busiest hurricane season since 2005: Five hurricanes made landfall in Louisiana, and frequent rain storms flooded the streets of New Orleans. Meanwhile, Boston experienced one of its hottest, driest summers on record, while the fall brought flooding in some of our most densely populated neighborhoods.
/bloom.bg/3aAYFvB

Citi’s Record Promotions for Women Still Just 29% of Total
Jennifer Surane – Bloomberg
Citigroup Inc. promoted 70 women in its latest class of managing directors, the most ever but still less than a third of the total. The 29% of women in the 241-person group was a slight improvement from last year’s 28%, according to the company. This year’s class also included five Black managing directors, up from three a year ago.
/bloom.bg/2KNobmy

How China Lost Patience With Jack Ma, Its Loudest Billionaire; While the sudden cancellation of his Ant Group IPO shocked many investors, Ma’s fall from grace had been years in the making.
Lulu Yilun Chen, Coco Liu – Bloomberg
When Jack Ma took to a Shanghai conference stage in October, China’s most famous entrepreneur was on the brink of pulling off an unprecedented $35 billion initial public offering for the finance juggernaut he co-founded two decades earlier. Ant Group Co.’s listing would value the company at more than $300 billion and swell Ma’s own fortune beyond its already blistering $61 billion, cementing his position as the nation’s richest man.
/bloom.bg/2WCi9b0

Trump’s Longtime Banker at Deutsche Bank Resigns; Rosemary Vrablic, who oversaw hundreds of millions of dollars in loans to President Trump’s company, will leave the bank next week.
David Enrich – NY Times
President Trump’s longtime banker at Deutsche Bank, who arranged for the German lender to make hundreds of millions of dollars of loans to his company, is stepping down from the bank. Rosemary Vrablic, a managing director and senior banker in Deutsche Bank’s wealth management division, recently handed in her resignation, which the bank accepted, according to a bank spokesman, Daniel Hunter.
/nyti.ms/37Lq6RD

Wall Streeters Reel In Riches From a Year of Unequal Rescues; Many business lines are thriving amid government intervention.
Max Abelson, Sally Bakewell, Shahien Nasiripour and Katherine Burton – WSJ
In a year of catastrophe, corners of Wall Street have been thriving. It’s a feat that can be explained by one word: access. Not to masks or vaccines, but to markets, to being in the flow. As the pandemic devastated large swaths of the economy, it delivered a once-in-a-generation windfall to those who buy, sell, borrow, lend and speculate in the world of high finance. Bank traders, dealmakers, hedge funds and even lenders are counting their profits after the tumult of 2020.
/bloom.bg/2WDk0ML

Exchange operators face scrutiny after bout of outages in 2020; Glitches deepen concerns among regulators and investors over financial system’s resilience
Philip Stafford – FT
Stock exchanges began the year with praise for their resilience during the pandemic turbulence but are ending it with their reliability under scrutiny. A series of high-profile outages in the second half of 2020 has put the spotlight on operators of the financial infrastructure that underlies global markets. The bumpy end of the year marks a stark contrast to the spring, when exchanges were commended by regulators for withstanding an unprecedented surge of activity at the height of the March ructions.
/on.ft.com/34E8PaW

The TRADE’s Crystal Ball 2021: Fixed income and post-trade; Gaze into The TRADE’s crystal ball for insights from industry participants across the fixed income and post-trade space on their predictions for the year ahead.
Hayley McDowell – The Trade
We expect to see further growth in the ETF market next year as investors assess opportunities to broaden the diversity of their portfolios through investments that provide exposure to a variety of industries, asset classes and exchanges across the globe at low cost.
/bit.ly/3mNhnT0

Coronavirus

2020 Was The Deadliest Year In U.S. History; Deaths are expected to top 3 million for the first time, mainly due to the coronavirus pandemic.
Mike Stobben – AP
This is the deadliest year in U.S. history, with deaths expected to top 3 million for the first time — due mainly to the coronavirus pandemic. Final mortality data for this year will not be available for months. But preliminary numbers suggest that the United States is on track to see more than 3.2 million deaths this year, or at least 400,000 more than in 2019.
/bit.ly/3bcGWrd

Hospitals Deluged as Vaccine Still Months Away for Most in U.S.
Nic Querolo and John Tozzi – Bloomberg
Almost twice as many hospitalized compared with earlier waves; Strain threatens to erode quality of care and traumatize staff
Covid-19 has hospitalized almost twice as many Americans as at any point in the pandemic, leaving medical providers on the brink of crisis with vaccine doses months away for most people. The U.S. health-care system and those who serve it are enduring more strain than ever. And the virus’s grip on hospitals has shifted toward more rural communities, where treatment alternatives are scarce.
/bloom.bg/37Lkw1D

How to get your next coronavirus stimulus check, and other questions, answered; Congress has agreed to another round of direct payments. Here’s when the IRS will send out $600 checks.
Fabiola Cineas and Ella Nilsen – VOX
Congress approved a stimulus package on Monday after reaching a deal on the provisions of the $900 billion plan. Like the $2.2 trillion CARES Act that Congress passed in late March, the second coronavirus stimulus will distribute cash directly to individual Americans as the coronavirus crisis inevitably stretches into 2021.
/bit.ly/38uTWZF

U.S. under siege from COVID-19 as hospitals overwhelmed before holidays
Susan Heavey, Gabriella Borter – Reuters
Americans were warned again on Tuesday not to travel for Christmas as the latest COVID-19 surge left hospitals struggling to find beds for the sick and political leaders imposed restrictions to try to curb new infections, making for a grim holiday season.
/reut.rs/2Jj1Xsa

Latest Covid Restrictions Mean There’s a Line for Everything; Businesses limit capacity, creating a velvet-rope feel even at your local gym. Shoppers feel under pressure to get in and out; ‘I’m not a looky-loo.’
Te-Ping Chen – WSJ
Barbara Ann Rogers, 61, was shopping for stationery, aware that others were watching. She had waited in line for 15 minutes on a cold day to get into a tiny Brooklyn stationery shop, which had capped capacity at just one customer as a coronavirus safety precaution. Now she was the store’s sole customer, examining racks of pens and notebooks, conscious of others still lined up outside in their winter coats, peering within.
/on.wsj.com/2WHU5nc

ASIC and IOSCO report on retail market conduct issues arising from COVID-19
ASIC
IOSCO’s Retail Market Conduct Task Force (RMCTF), co-chaired by ASIC and the Central Bank of Ireland, has today published the Retail Market Conduct Task Force Report: Initial Findings and Observations About the Impact of COVID-19 on Retail Market Conduct.
/bit.ly/3mNiHoW

Exchanges, OTC and Clearing

Cboe Lists for Trading Four Active Non-Transparent ETFs from Invesco
Cboe Global Markets
Invesco’s first active non-transparent ETFs are now trading on Cboe BZX Exchange; With these four ETFs, Cboe lists a total of 21 ETFs from Invesco; Cboe is the leading exchange for listing and trading of new generation of actively managed ETFs
Cboe Global Markets, Inc. (Cboe: CBOE), a market operator and global trading solutions provider, today announced it has listed for trading four active non-transparent ETFs from Invesco Ltd.: the Invesco Focused Discovery Growth ETF ?(Ticker: IVDG), Invesco Select Growth ETF? (Ticker: IVSG), Invesco Real Assets ESG ETF? (Ticker: IVRA), and Invesco U.S. Large Cap Core ESG ETF? (Ticker: IVLC).
/bit.ly/2WJTZet

Some NYSE operations to return to remote working
Reuters Staff
Some of the New York Stock Exchange’s operations will temporarily return to remote working from Monday amid the ongoing coronavirus outbreak. “In response to changes in the NYC-area public health conditions, NYSE designated market makers (DMMs) will temporarily return to remote operations (with limited exceptions),” an NYSE spokeswoman said in an emailed statement.
/reut.rs/37FAbzo

CME Group Inc. Announces Fourth-Quarter and Year-End 2020 Earnings Release, Conference Call
CME Group
CME Group Inc. will announce earnings for the fourth quarter and full year of 2020 before the markets open on Wednesday, February 10, 2021. Written highlights for the quarter and year will be posted on the company’s website at 6:00 a.m. Central Time, the same time it provides its earnings press release. The company will hold an investor conference call that day at 7:30 a.m. Central Time, at which time company executives will take analysts’ questions.
/bit.ly/3hcVtY6

Regularity Approval for Precious Metals Carrier
CME Group
New York Mercantile Exchange, Inc. (“NYMEX”) and The Commodity Exchange, Inc. (“COMEX”) (collectively, the “Exchanges”) have received and approved the application of Helveticor AG to be a carrier for the Gold, Gold Enhanced Delivery (4GC), Platinum, and Palladium futures contracts on their respective exchanges. This approval is effective immediately.
/bit.ly/2Kv9qVA

Change in Regular Firm’s Clearing Agent
CME Group
The Exchange has been notified that Minnesota Soybean Processors has changed its clearing agent to RJ O’Brien & Associates for the firm’s Soybean Oil transactions.
/bit.ly/3rnHfbL

Change in Regular Firm’s Clearing Agent
CME Group
The Exchange has been notified that Ag Processing, Inc. has changed its clearing agent to StoneX Financial, Inc. for the firm’s Soybean Oil and Soybean Meal transactions.
/bit.ly/2WHRjhv

Regularity Approvals for Copper
CME Group
The Commodity Exchange, Inc. (“COMEX” or “Exchange”) has received and approved the applications of Stagecoach Cartage and Distribution, LLC for regularity for the storage of copper deliverable against the COMEX Copper futures contract at their locations in El Paso, TX (5850 Welch ave. and 5830 Welch ave.). The approved capacities at these warehouses are 60,000 short tons and 30,000 short tons respectively.
/bit.ly/3mFDI57

Application for Aluminum Regularity
CME Group
Notice is hereby given that Access World (Rotterdam) B.V. has applied for regularity for aluminum deliverable against the COMEX Aluminum futures contract:
/bit.ly/38z84kw

HKEX completes first client cleared trade for Japanese banks; Hong Kong Exchanges and Clearing (HKEX) has completed its first client clearing trades for Japanese banks, further expanding the international reach of its fixed income and currency clearing offering.
Joe Parsons – The Trade
HKEX’s OTC Clearing Hong Kong (OTC Clear), cleared a US Dollar-Offshore Renminbi Cross – Currency Swap (USDCNH CCS) trade by Mizuho Bank and a US Dollar-Hong Kong Dollar (USDHKD CCS) trade by MUFG Bank, with HSBC acting as the clearing broker for both trades.
/bit.ly/37O2BYd

Hopium, first manufacturer of high-end hydrogen-powered vehicles, lists on Euronext Access Paris; MARKET CAPITALISATION OF EUR11.7 MILLION
Euronext
Euronext today congratulates Hopium, the French manufacturer of high-end hydrogen-powered cars, on its listing on Euronext Access Paris (ticker code: MLHPI). Hopium was founded in 2019 by the French racing driver Olivier Lombard with the aim of becoming the world’s leading brand of hydrogen-powered vehicles and provide a response to contemporary environmental issues.
/bit.ly/3nJAK0N

MSCI derivatives: Amendments to the Price List of Eurex Clearing AG and other pricing measures
Eurex
Eurex Circular 103/20 MSCI derivatives: Amendments to the Price List of Eurex Clearing AG and other pricing measures
/bit.ly/3nL9xL7

OTC Clear Completes 1st Trades for Japanese Banks via Client Clearing
HKEX
Trades reflect increased client demand for CCS clearing services through HKEX; Strong growth in CCS clearing volumes for first nine months to 30 September 2020, up 17 per cent to US$62 billion
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce that its central counterparty (CCP) subsidiary, OTC Clearing Hong Kong Limited (OTC Clear), has successfully completed its first client clearing trades for Japanese financial institutions, further expanding the reach of HKEX’s fixed-income and currency product offering in the region and internationally.
/bit.ly/2KNJt3t

To 2021 and beyond – a regulator’s perspective
Tan Boon Gin – SGX
I attended and spoke at several conferences and panel discussions in November. While these were different events put together by organisations including Global Compact Network Singapore, the Financial Times, Association of Corporate Treasurers, Singapore Institute of Directors, and REIT Association of Singapore, they all had a similar link – COVID-19. COVID-19 has swept across the globe, broken up supply chains, shuttered businesses and rendered masses of individuals jobless. The pandemic has become a common thread for discussion and introspection across typically unconnected events.
/bit.ly/3nLQwrZ

Fintech

FinTech, Italian Banking Association: Launch Of Experimental Digital Euro Project
Mondovsione
Banks and the Italian Banking Association, in cooperation with ABI Lab, the banking research and innovation centre of the Italian Banking Association (ABI), have started experimentation with the digital euro. The aim of the initiative is to proactively contribute to public debate and support banks operating in Italy as they prepare for the future.
/bit.ly/3nXoWIt

U.S. Urges American Firms to Shun Chinese Data Service Companies
John Harney – Bloomberg
Homeland Security warns of trade secret, competition risks; Advisory comes after hack that Trump advisers blame on Russia
The Department of Homeland Security warned U.S. firms against using data services and equipment from firms linked to China because of cyber security and other risks. “For too long, U.S. networks and data have been exposed to cyber threats based in China which are using that data to give Chinese firms an unfair competitive advantage in the global marketplace,” Acting Secretary of Homeland Security Chad Wolf said in a letter with a lengthy advisory released on Tuesday night.
/bloom.bg/3nKJoMs

How To Develop Thought Leadership Topics For Fintech SaaS
Yogesh Shah, Forbes Development Council – Forbes
It’s all about fintech right now.
Deloitte says we should expect a new wave of disruption across the banking industry. Tons of economic, geopolitical, social, environmental and demographic shifts could be afoot. By the turn of 2030, I expect the financial services industry to look unrecognizable. According to Deloitte, we largely have technology to thank. Today’s ground is fertile for growing the next generation of financial thought leaders. Here’s how to develop thought leadership topics in fintech.
/bit.ly/34BC9is

It’s the ‘hottest market’ for fintechs right now. 4 investors explain why they’re optimistic things won’t slow down in 2021.
Shannen Balogh – Business Insider
2020 has been a big year for fintech, with consumers turning to digitally-native apps and services to manage their finances. And there’s been no shortage of funding to fuel fintechs’ growth. From M&A and public listings to competitive private funding rounds, fintech investors are optimistic about the exit opportunities that await their portfolio companies in 2021.
bit.ly/2WIyAlY

The next hot fintech trends top VCs are betting on: Embedded finance, finfluencers, and a ‘great rebundling’
Shannen Balogh – Business Insider
We asked fintech investors at Bain Capital Ventures, Citi Ventures, Index Ventures, and PayPal Ventures what they’re looking out for in 2021. Every investor said that embedded finance startups, or those who provide the infrastructure that enables companies to rollout financial offerings, had a big year and will continue to be a focus in 2021. In 2021, investors are looking out for everything from the rise of finfluencers to changes in how loans are originated.
bit.ly/3nKLcoI

How Forex Trading Apps Are Reshaping The Fintech Space In 2021
Shama Hyder – Forbes
Foreign exchange, or forex, trading is hard. Many who get into what is the largest financial market in the world end up failing. That is, of course, a huge reason why there are so many trading apps designed to help amateur traders figure out the markets, from cryptocurrency to typical stock exchanges—and now forex trading, as well. Take Robinhood, Public, and Personal Capital for example. All are designed to help the everyday Joe and Jane become traders. In the fintech world, forex apps and other trading apps are one of the trends that we’ll see continue to grow in 2021. I spoke with one app developer, Maksim Konstantinov of FXBro, about why.
bit.ly/34DGCRr

Robinhood: A Disruptor to Watch or Cautionary Tale?
Gina Clarke – The Fintech Times
This week has not been a good one for Robinhood; An SEC fine for misleading customers about how it makes money and a Massachusetts complaint for failing to protect its customers. Add to that a recent slash to annual margin rates by 2.5% and suddenly the eyes of the world are asking – what will this fintech do next?
bit.ly/3haLsLg

Atomyze LLC Appoints Senior Executives to Leadership Team
Atomyze
Corey Wendling joins fintech platform as chief technology officer Lynette Ashby appointed as chief legal officer and Wendi Carver steps into chief business operations officer role
/bit.ly/2WIcSyF

Cryptocurrencies

SEC Sues Ripple Over XRP Cryptocurrency
Paul Vigna and Dave Michaels – WSJ
The Securities and Exchange Commission on Tuesday filed a civil suit claiming Ripple Labs Inc. violated investor-protection laws when it sold a bitcoin-like digital asset called XRP. The suit is one of the highest-profile SEC actions against a cryptocurrency pioneer and comes just as the regulator’s chairman is departing at the end of the Trump administration. The SEC over the past few years has brought and mostly won civil lawsuits alleging startups trampled securities laws when they raised money by selling cryptocurrencies. None of those companies, though, was as big as Ripple and XRP. Ripple had a $10 billion valuation in its most recent funding round in 2019, and XRP is the third-largest cryptocurrency by market value.
on.wsj.com/2WHLiBq

*****See also: Ripple Labs, Executives Sued by SEC for Failing to Register XRP by Chris Dolmetsch, Bloomberg; Ripple is being sued by the SEC by Jemima Kelly and Izabella Kaminska, FT; and http://bit.ly/3mLcOZB by Aislinn Keely, The Block.~MR

MoneyGram Takes Wait-and-See Approach as SEC Sues Partner Ripple
Nathan DiCamillo – Coindesk
MoneyGram has yet to see any “negative impact” on its longstanding business arrangement with Ripple from the U.S. Securities and Exchange Commission (SEC)’s lawsuit against the latter company. “MoneyGram will continue to monitor the situation as it evolves,” a company spokesperson told CoinDesk in an emailed statement. “MoneyGram has continued to utilize its other traditional FX trading counterparties throughout the term of the agreement with Ripple.” The SEC alleged in a case filed Tuesday that Ripple used XRP, the cryptocurrency two of its founders created, to conduct an ongoing, $1.3 billion sale of unregistered securities.
bit.ly/2M2mG4u

Hong Kong crypto exchange OSL suspends XRP trading until further notice
Yogita Khatri – The Block
Hong Kong-based licensed crypto exchange OSL has suspended all XRP trading and payment services until further notice. OSL announced the news on Wednesday, saying that it has taken the decision in light of the U.S. Securities & Exchange Commission’s (SEC’s) enforcement action against Ripple and two of its executives — CEO Brad Garlinghouse and co-founder Chris Larsen. The SEC yesterday filed a complaint and alleged that Ripple and the executives have raised more than $1.3 billion via ongoing, unregistered securities XRP sales. The regulator deems XRP as a security.
bit.ly/2M4gn0f

Cryptocurrency XRP tumbles 24% after U.S. SEC charges Ripple
Reuters Staff – Reuters
Cryptocurrency XRP XRP=BTSP tumbled 24% on Wednesday after the U.S. Securities and Exchange Commission (SEC) charged associated blockchain firm Ripple with conducting a $1.3 billion unregistered securities offering.
/reut.rs/2WFrtL7

Crypto Exchange Pioneer Miha Grcar Joins Kraken As Head Of Business Development
Kraken
Kraken is thrilled to announce that Miha Grcar, a pioneer of the cryptocurrency exchange sector, will officially be joining our team as Head of Business Development.
/bit.ly/3nFnsSO

Ethereum Developer Virgil Griffith Will Likely Face Trial Next September
Sandali Handagama – Coindesk
The U.S. government intends to argue that Ethereum developer Virgil Griffith helped North Koreans better understand how crypto could be used to bypass financial sanctions on the nation. Griffith, who was arrested in November 2019 on charges of conspiracy to assist North Korea (DPRK) in using cryptocurrency for its own benefit, is seeking to have the case against him dismissed. While U.S. District Judge P. Kevin Castel, of the Southern District of New York, made a handful of rulings on minor points in the case, a full trial has been tentatively scheduled for September 2021.
/yhoo.it/34C3JvM

Coinbase Awards Its First Round of Bitcoin Developer Grants
Colin Harper – Coindesk
Coinbase has revealed the inaugural recipients of its Crypto Community Fund developer grants. First announced in October, the fund was established to support Bitcoin developers in their work on projects that support the cryptocurrency’s underlying technology.
/yhoo.it/3pk5buE

Crypto Exchange Coinbase Is Hiring for a New Canada Operation
Tanzeel Akhtar – Coindesk
San Francisco-based Coinbase announced Tuesday it’s expanding its business into Canada and is currently seeking staff to help operate its new branch.
/yhoo.it/3mLu9RW

ShipChain to settle with SEC, pay $2 million penalty for unregistered initial coin offering
Aislinn Keely – The Block
The Securities and Exchange Commission (SEC) has filed for penalties and a cease-and-desist order as part of a proposed settlement to an allegedly unregistered initial coin offering (ICO) by ShipChain. ShipChain — an Ethereum-based shipping tracker that raised funds selling its SHIP token in 2017 and 2018 — intends to settle with the SEC, per the documents. ShipChain received another cease-and-desist order back in 2018, when the South Carolina Attorney General alleged the firm violated state securities laws. Now, the SEC is ordering ShipChain to transfer all SHIP tokens to the SEC and have the asset delisted on exchanges in the next ten days. It’ll also have to pay a $2,050,000 penalty to the regulator.
bit.ly/3pn8jWz

Anthony Scaramucci outlines his new Bitcoin fund, discloses initial $25 million investment during interview
MK Manoylov – The Block
The bitcoin fund founded by Anthony Scaramucci’s SkyBridge Capital has invested some $25 million ahead of a planned public opening sometime next year. In comments to CNBC, Scaramucci outlined the contours of the Bitcoin fund — the existence of which The Block reported Monday — and its potential appeal to would-be investors. “It became clear that we needed to create a client-friendly product, something with a $50,000 minimum, that the mass affluent could access, or RIAs that were close to it can access,” Scaramucci told the outlet.
bit.ly/3nFxaoe

Ethereum Developer Virgil Griffith Will Likely Face Trial Next September
Sandali Handagama – Coindesk
The U.S. government intends to argue that Ethereum developer Virgil Griffith helped North Koreans better understand how crypto could be used to bypass financial sanctions on the nation. Griffith, who was arrested in November 2019 on charges of conspiracy to assist North Korea (DPRK) in using cryptocurrency for its own benefit, is seeking to have the case against him dismissed. While U.S. District Judge P. Kevin Castel, of the Southern District of New York, made a handful of rulings on minor points in the case, a full trial has been tentatively scheduled for September 2021.
bit.ly/2KR4yK2

Coinbase Awards Its First Round of Bitcoin Developer Grants
Colin Harper – Coindesk
Coinbase has revealed the inaugural recipients of its Crypto Community Fund developer grants. First announced in October, the fund was established to support Bitcoin developers in their work on projects that support the cryptocurrency’s underlying technology. The first two developers, João Barbosa and pseudonymous developer 0xB10C, were chosen by the fund’s advisory board, which includes Stanford cryptography professor Dan Boneh and Bitcoin developers Carla Kirk-Cohen, Anthony Towns, Amiti Uttarwar and Felix Weis.
bit.ly/3hfEDb2

Italian Banks Start Experiments With Digital Euro Built on Blockchain Tech
Tanzeel Akhtar – Coindesk
The Italian Banking Association (ABI) has started experimentation with a digital euro based on distributed ledger technology. Comprised of over 700 Italian banking institutions, the ABI said Tuesday the work would examine the technical feasibility of a digital euro and further look at “new value-added services” that would become possible due to the programmable nature of the technology. “The aim of the initiative is to proactively contribute to public debate and support banks operating in Italy as they prepare for the future,” said the ABI in a statement.
bit.ly/3mNf6XY

Polkadot-Based DeFi Insurance App Raises $1.95M Led by KR1
Brady Dale – Coindesk
Insurance startup Tidal Finance has raised a $1.95 million seed round for its TIDAL token, led by European digital asset company KR1. New York-based Tidal will use the Polkadot blockchain to allow users to contribute funds that insure a set of decentralized finance (DeFi) applications against smart-contract failure or breaches in one pool, theoretically improving the capital efficiency for DeFi investors interested in insurance. Other participants in the round included NGC Ventures, Kenetic Capital, Genesis Block and others. The pioneer in protocol insurance is Ethereum-based Nexus Mutual, which funded itself with a token sale and paid out its first claim in February, following the first round of attacks on bZx, the flash loan provider.
bit.ly/37HBE8g

Craig Wright’s Wife Wins UK Lawsuit Over Bitcoin Trading Account Closure
Daniel Palmer – Coindesk
Ramona Ang, the wife of controversial cryptocurrency industry figure Craig Wright, has won a lawsuit in the U.K. High Court over losses she incurred when the UFX exchange platform closed her account without returning her funds. In a November ruling, Justice Christopher Butcher granted Ang’s claim to equitable compensation, saying the Cyprus-based defendant Reliantco – operator of UFX – had failed to justify its counterclaim and “acted in breach of trust and of its fiduciary duties of loyalty in dealing with the positions opened on Ms. Ang’s account.”
bit.ly/2KPMrnU

Politics

No vaccine can end America’s pandemic of ignorance and irrationality
Max Boot – Washington Post
Earlier this year, experts tried to dampen enthusiasm about a potential coronavirus vaccine by noting that the fastest development time for any previous vaccine had been four years for the mumps vaccine in the 1960s. Most vaccines take 10 to 15 years to create, and many infectious diseases have no vaccine at all.
/wapo.st/2JdL8Pa

Trump’s longtime banker at Deutsche Bank resigns
Reuters Staff
Donald Trump’s longtime banker at Deutsche Bank AG will be stepping down from the German lender, with the move coming as the bank looks for ways to cut its relations with the U.S. president. Rosemary Vrablic, a managing director and senior banker in the lender’s wealth management division, recently handed in her resignation, which the bank accepted effective as of year-end, Deutsche Bank spokesman Dan Hunter said in an emailed statement.
/reut.rs/3aCVpQj

Trump threatens to not sign COVID-19 bill, wants bigger stimulus checks
Reuters Staff – Reuters
President Donald Trump threatened on Tuesday to not sign an $892 billion coronavirus relief bill that includes desperately needed money for individual Americans, saying it should be amended to increase the amount in the stimulus checks.
/reut.rs/3hcU1F8

Biden’s Uphill Battle to Hold the Internet Together; The U.S. and China pitch the rest of the world on very different visions of the web.
Alyza Sebenius – Bloomberg
Almost a decade ago as vice president, Joe Biden believed that the internet was at an inflection point. In a 2011 speech he warned other countries that they wouldn’t be able to reap the internet’s economic benefits if they undermined its openness by imposing national-level censorship rules and other technical roadblocks. “There isn’t a separate economic internet, political internet, and social internet,” he said. “They are all one.”
/bloom.bg/3pjY3hS

Kerry’s First Task on Climate Is to Reestablish U.S. Credibility
The diplomat and architect of the Paris accord will have to overcome deep skepticism about America’s commitment to climate goals.
David Wainer and Ari Natter – Bloomberg Green
To show the world that the U.S. will be an environmental leader once again, President-elect Joe Biden is turning to the driving force behind the climate agreement that President Donald Trump has spent four years undermining.
/bloom.bg/3mH1Eox

Who Won and Lost in the Stimulus Bill? Democrats get relief for the poor while the president gets a boost for his business.
Jonathan Bernstein – Bloomberg
I got one wrong. In the deal reached Sunday on the pandemic relief and stimulus bill, it appears that President Donald Trump successfully negotiated for one of his priorities: the return of the three-martini lunch.
/bloom.bg/3aDsNXi

FBI Says White Supremacists Plotted Attack on U.S. Power Grid
Amy Forliti – AP
White supremacists plotted to attack power stations in the southeastern U.S., and an Ohio teenager who allegedly shared the plan said he wanted the group to be “operational” on a fast-tracked timeline if President Donald Trump were to lose his re-election bid, the FBI alleges in an affidavit that was mistakenly unsealed.
/bloom.bg/2KyY6Ym

Will Anyone Put a Stop to Trump’s Antics? As the president continues his unhinged attempt to overturn the election, Republican senators face a choice.
Jonathan Bernstein – Bloomberg
I really didn’t want to write about outgoing President Donald Trump again this month, but he’s still the president, and his behavior is increasingly … I don’t know the right word, really. Unsettling? Dangerous? Disturbing? All of the above?
/bloom.bg/38qkOtM

Regulation

US gives green light to low-cost IPO alternative; SEC ruling allows companies to raise money in a direct listing on the New York Stock Exchange
David Carnevali – FT
Companies will soon be able to raise money through a direct listing on the New York Stock Exchange, sidestepping the high fees paid to Wall Street underwriters in a traditional initial public offering, after a regulatory ruling on Tuesday.
/on.ft.com/34EsoQk

CFTC Staff Releases Position Limits Workbook to Provide Clarity to Market Participants
CFTC
The Commodity Futures Trading Commission’s Division of Market Oversight (DMO) today released a staff workbook to provide guidance to market participants on which exchange-traded futures contracts would be subject to the position limits rule the Commission approved in October. [See CFTC Press Release No. 8287-20]
/bit.ly/3azfW8k

Wisconsin Court Enters $740,968 Judgement Against Company and its Principal for Registration, Disclosure, and Recordkeeping Violations
CFTC
The Commodity Futures Trading Commission announced the U.S. District Court for the Eastern District of Wisconsin entered permanent trading and registration bans and a $740,968 civil monetary penalty against Southwest Services, L.L.C. a/k/a South West Services, LLC and its sole managing member, Timothy A. Sack of Oshkosh, Wisconsin. The court’s action follows the CFTC’s filing of a civil enforcement action against the defendants in October 2020. [See CFTC Press Release No. 8279-20]
/bit.ly/2KjpkSZ

Federal Court Orders North Carolina Man to Pay Over $255,000 in Futures and Forex Fraud Scheme
CFTC
The Commodity Futures Trading Commission today announced that Judge Max O. Cogburn Jr., of the U.S. District Court for the Western District of North Carolina, entered a consent order against Mark N. Pyatt, of North Carolina, imposing a permanent injunction and ordering Pyatt to make restitution in the amount of $255,850. The order also permanently bans Pyatt from registering with the CFTC and from trading commodity futures and retail foreign exchange contracts (forex). In the order, Pyatt admitted to fraudulently soliciting individuals to place funds in a commodity pool and to misappropriating most of the funds he solicited.
/bit.ly/37HUBYI

SEC finally approves NYSE’s direct listings with capital raise
Kia Kokalitcheva – Axios
The U.S. Securities and Exchange Commission finally approved on Tuesday a rule change that will allow companies going public on the New York Stock Exchange to simultaneously raise primary capital.
/bit.ly/3rvvKPJ

Federal Reserve orders Credit Suisse to strengthen anti-money laundering policies
Pete Schroeder – Reuters
The U.S. Federal Reserve ordered Credit Suisse on Friday to strengthen its anti-money laundering policies after bank examiners found deficiencies in its U.S. operations.
/reut.rs/3nLDcUv

Federal Reserve Board issues enforcement action with Credit Suisse
Federal Reserve
Federal Reserve Board on Tuesday announced the execution of the enforcement action listed below: Credit Suisse Group AG, Zurich, Switzerland; Credit Suisse AG, Zurich, Switzerland; Credit Suisse Holdings (USA), Inc., New York, New York; and Credit Suisse AG, New York Branch, New York, New York
/bit.ly/2Jd6ZWW

SEC and CONSOB Sign New Supervisory Cooperation Arrangement
SEC
The Securities and Exchange Commission and the Commissione Nazionale per le Società e la Borsa (CONSOB) today announced the signing of a Memorandum of Understanding (MOU) concerning consultation, cooperation and the exchange of information regarding the supervision of regulated entities that conduct financial services business in the U.S., Italy, or both.
/bit.ly/3pgAruE

SEC Proposes Amendments to Rule 144 and Form 144; Designed to Reduce Risk of Unregistered Distributions
SEC
The Securities and Exchange Commission today voted to propose an amendment to Rule 144 under the Securities Act of 1933 to revise the holding period determination for securities acquired upon the conversion or exchange of certain “market-adjustable securities.” The proposed amendment is intended to reduce the risk of unregistered distributions in connection with sales of those securities. The Commission also voted to propose amendments to update and simplify the Form 144 filing requirements.
/bit.ly/3rnJXhr

SEC Adopts Modernized Marketing Rule for Investment Advisers
SEC
The Securities and Exchange Commission today announced it had finalized reforms under the Investment Advisers Act to modernize rules that govern investment adviser advertisements and payments to solicitors. The amendments create a single rule that replaces the current advertising and cash solicitation rules. The final rule is designed to comprehensively and efficiently regulate investment advisers’ marketing communications.
/bit.ly/2M2LtFz

SEC Awards Over $1.6 Million to Whistleblower
SEC
The Securities and Exchange Commission today announced an award of more than $1.6 million to a whistleblower whose tip significantly contributed to the success of an enforcement action. The whistleblower produced critical information about an ongoing fraudulent scheme and provided extensive assistance to the investigative staff, including by participating in meetings and furnishing high-quality evidence.
/bit.ly/2KtqcEo

SEC Issues Substituted Compliance Order for Germany and Notice of Substituted Compliance Application and Proposed Substituted Compliance Order for France
SEC
The Securities and Exchange Commission voted to take two actions to advance implementation of security-based swap regulation under Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act. First, the Commission is publishing a final substituted compliance order in response to an application by Germany’s Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin). In addition, the Commission is publishing a notice of application and proposed substituted compliance order in response to an application by France’s Autorité des Marchés Financiers (AMF) and Autorité de Contrôle Prudential et de Résolution (ACPR).
/bit.ly/37KMCty

Charles Koretke Named Managing Executive of Division of Examinations
SEC
The Securities and Exchange Commission today announced that Charles Koretke has been named Managing Executive of the Division of Examinations. In this role, Mr. Koretke will manage and lead Examinations’ business operations in the areas of human capital, examiner training and development, budget formulation and execution, planning and executing information technology initiatives, and the provision of analytical services that support examinations. He also will serve as Examinations’ primary liaison to other SEC divisions and offices on these matters. Mr. Koretke has been serving as Examinations’ Acting Managing Executive since October 2019.
/bit.ly/37NVDT3

Dalia Blass to Conclude Tenure as Director of the Division of Investment Management
Under Director Blass’s Leadership, the Division Undertook Numerous Initiatives Benefitting Main Street Investors
SEC
The Securities and Exchange Commission today announced that Dalia Blass, Director of the Division of Investment Management, will depart the SEC in January after leading the Division since September 2017. Under her leadership, the Division finalized more than 70 regulatory initiatives affecting investment companies and investment advisers.
/bit.ly/37JdSsz

S.P. Kothari to Conclude Tenure As SEC Chief Economist and Division of Economic and Risk Analysis Director
SEC
The Securities and Exchange Commission today announced that S.P. Kothari, Chief Economist and Director of the SEC’s Division of Economic and Risk Analysis, will conclude his tenure by the end of January.
/bit.ly/2WI3FX7

Memorandum of Understanding (MOU) between United States Securities and Exchange Commission (SEC) and the Commissione Nazionale per le Societ e la Borsa
SEC
In view of the growing globalization of the world’s financial markets and the increase in crossborder operations and activities of regulated entities, the United States Securities and Exchange Commission (“SEC”) and the Commissione Nazionale per le Società e la Borsa (“CONSOB”) (jointly, the “Authorities”) have reached this Memorandum of Understanding (“MOU”) regarding consultation, cooperation and the exchange of information in the supervision and oversight of markets and financial services firms in the United States and Italy. The Authorities express, through this MOU, their willingness to cooperate with each other in the interest of fulfilling their respective regulatory mandates in the context of supervising firms within the scope of this MOU, particularly in the areas of: investor protection; promoting the compliance culture of regulated entities that operate on a cross-border basis; maintenance of fair, orderly and efficient securities and derivatives markets; and reducing systemic risk.
/bit.ly/3pksbtG

Statement on the Proposed Amendment to Rule 144 Commissioner Elad L. Roisman
SEC
/bit.ly/34AtgWc

Statement on NYSE Primary Direct Listing Proposal Commissioner Elad L. Roisman
SEC
/bit.ly/3pfugHh

Statement on the Investment Adviser Marketing Final Rule Commissioner Hester M. Peirce
SEC
/bit.ly/2WHUnKx

Statement on the New Marketing Rule for Investment Advisers Commissioner Elad L. Roisman
SEC
/bit.ly/3aBVeol

Investment Adviser Marketing – Past Proposals are Not Necessarily Indicative of Future AdoptionsCommissioner Allison Herren Lee, Commissioner Caroline A. Crenshaw
SEC
/bit.ly/3mDwaje

FCA publishes final Brexit instruments and Temporary Transitional Power (TTP) directions
UK FCA
The FCA has published the final onshoring instruments, related guidance and Temporary Transitional Power (TTP) directions that will apply at the end of the Brexit transition period.
/bit.ly/38yx63p

MyJar enters administration
UK FCA
On 22 December 2020, MyJar Ltd, was placed into administration. David Clements, Paul Boyle and Anthony Murphy of Harrisons Business Recovery & Insolvency (London) Limited were appointed as Joint Administrators.
/bit.ly/3aBFaD2

ESMA Consults on Fines and Penalties For Benchmark Administrators
ESMA
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, today launches a consultation on specific aspects of the procedural rules for imposing fines and penalties on Benchmark Administrators under ESMA’s direct supervision.
/bit.ly/3mKyMvR

ESMA Consults on Fines and Penalties For Data Reporting Services Providers
ESMA
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, today launches a consultation on specific aspects of the procedural rules for imposing fines and penalties on Data Reporting Services Providers (DRSPs) under ESMA’s direct supervision.
/bit.ly/2M4kFon

ESMA updates guidance on waivers from pre-trade transparency
ESMA
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, published today an updated opinion providing guidance on pre-trade transparency waivers for equity and non-equity instruments. It covers guidance related to request for quote systems, guidance on how trading venues should apply for a waiver to their national competent authority, and updates on frequently encountered issues when assessing waiver notifications.
/bit.ly/3hbEc1H

Proposed Rule Change to Extend the Implementation Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to SR-FINRA-2015-036
FINRA
Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) a proposed rule change to extend, to October 26, 2021, the implementation date of the amendments to FINRA Rule 4210 (Margin Requirements) pursuant to SR-FINRA-2015-036, other than the amendments pursuant to SR-FINRA-2015-036 that were implemented on December 15, 2016.
/bit.ly/37Jmn73

Effective date for Interpretive Notice establishing SD supervision requirements over use of marketing materials
NFA
NFA recently adopted an Interpretive Notice entitled NFA Compliance Rule 2-9(d) Swap Dealer and Major Swap Participant Supervision of the Use of Marketing Materials. The Interpretive Notice provides guidance to swap dealer (SD) Members regarding their regulatory obligations under Compliance Rule 2-9(d) related to their use of marketing materials. The Interpretive Notice is based on supervisory principles that are tailored to reflect that SD Members conduct business exclusively with counterparties that qualify as eligible contract participants and negotiate bilateral, bespoke swaps tailored to a counterparty’s specific needs. The Interpretive Notice will become effective on May 31, 2021.
/bit.ly/2KRnxUQ

Investing and Trading

‘Stay-at-home’ trade still has legs in ’21: top mutual fund managers
David Randall – Reuters
The so-called “stay-at-home” trade will not end next year even if the pandemic is defeated, according to managers of the top-performing U.S. mutual fund managers of 2020. They are continuing to bet on those stocks.
/reut.rs/34E0OTq

Trading Stocks in 2020 Was No Game. Or Was It? The proportion of U.S. shares held by individuals has started rising again amid the explosion in ETFs and popularity of Robinhood. Is that a good thing?
John Authers – Bloomberg
Institutionalized, Professionalized, Democratized or Gamified?
I mentioned earlier this week that markets have grown far more institutionalized over the last half-century. Some would object that the word is pejorative and say that they have been “professionalized.” Either way, the idea is the same.
/bloom.bg/3hbtVm2

A $1.8 Trillion Bond Glut Imperils Treasuries’ Seven-Year Rally
Liz McCormick – Bloomberg
Long-term auctions have grown, Fed buying to slow versus 2020; Shift is ‘key part of our calculus’ pointing to higher yields
The era of swelling Treasury auctions may be over for now, but investors are still about to absorb a historical deluge of long-term debt next year, with potentially painful implications for returns.
/bloom.bg/38pHvhK

Cliff Asness Says Value Revival Has Become Quant ‘Gut Punch’
Gregor Stuart Hunter – Bloomberg
Gains for cheap stocks are failing to change AQR’s fortunes; Quality, momentum, low beta equities have been faring poorly
A rebound in the performance of long-suffering value shares in the past few weeks has done little to help quantitative investors who utilize a variety of factors, according to Cliff Asness.
/bloom.bg/3heKzRQ

No End in Sight for Blank-Check Companies After Year of the SPAC
Crystal Tse – Bloomberg
SPACs raised a record $78 billion on U.S. exchanges in 2020; Founders set to vie for targets, offer investor concessions
There are four letters that sum up 2020’s equity market: S-P-A-C. Special purpose acquisition companies, or SPACs, went from a back-of-the-shelf financial vehicle to one of the biggest segments of initial public offerings, with a record $78 billion raised in the U.S. this year, according to data compiled by Bloomberg. That exceeded the combined total of SPACs in all previous years and made up about 45% of this year’s record $177 billion IPO volume, the data show.
/bloom.bg/3haJpXA

Environmental, Social and Corporate Governance

Asia Carbon-Free Plans Boost Outlook for ESG Credit Issuance
Beth Thomas – Bloomberg
China, Japan’s zero-carbon targets need funding to ramp up; ESG debt sales fell this year due to drop in green finance
Asia will need all the help it can get next year from more financing for environmental, social and governance projects, after recently setting some of the world’s most ambitious goals to end carbon emissions.
/bloom.bg/3nM7beK

Nornickel Shutters Dirty Copper Smelter in Push to Go Greener
Yuliya Fedorinova – Bloomberg
Smelter on the Kola Peninsula is one of Nornickel’s dirtiest; Closure will help cut sulfur-dioxide emissions by 85%
Russia’s MMC Norilsk Nickel PJSC is shutting its oldest copper smelter amid mounting pressure for metals producers to clean up their aging and dirtiest operations.
/bloom.bg/3nM7jee

Exxon Knows Its Carbon Future And Keeps the Data From View
Kevin Crowley and Akshat Rathi – Bloomberg
It was February 2019, and Exxon Mobil Corp. was ready to make one of the largest-ever investments in a U.S. hub for overseas shipments of liquefied natural gas. The $10 billion project was going to be built on the Texas coast under an auspicious name: Golden Pass.
/bloom.bg/3hk6GGv

Octopus Eyes Japan’s Power Market with Tokyo Gas Joint Venture
Ronan Martin – Bloomberg
U.K. energy provider says it’s now valued at $2.1 billion; Japan venture follows expansion in Germany, U.S. markets
Octopus Energy Ltd., the U.K. green power provider, is expanding in Japan as it joins other European utilities seeking a foothold in the budding Asian electricity market. In a partnership with Tokyo Gas, Octopus will provide 100% renewable electricity to consumers as Prime Minister Yoshihide Suga targets net-zero emissions by 2050, it said in a statement. Renewables only accounted for 19% of Japan’s energy mix in 2019, compared with 38% in the U.K., Octopus said.
/bloom.bg/3mH8YAx

The factory by a Tuscan beach and the future of ESG investing; Some investors who want to assess the environmental record of companies worry about how ratings are compiled
Silvia Sciorilli Borrelli in Milan and Attracta Mooney – FT
It is sometimes called the Italian Maldives. Rosignano is a Tuscan tourist destination that is home to 30,000 people and famous for its white beaches, which draw people from all over Europe.
/on.ft.com/34DGwJz

Institutions

Interactive Brokers Sets Up Irish Unit for Brexit Hiring Spree
Peter Flanagan – Bloomberg
U.S. broker to ‘expand its staffing substantially’ in Dublin; More than 100 firms sought post-Brexit approval in Ireland
Interactive Brokers Group Inc. plans a post-Brexit hiring spree in Ireland after the nation’s central bank authorized the firm to set up a new entity in the country. The Greenwich, Connecticut-based broker “expects to expand its staffing substantially over the next year” amid “strong growth” in Europe, it said Wednesday.
/bloom.bg/3nFoJt4

SoftBank Billionaire Puts a New Spin on SPAC Mania; In theory the SoftBank SPAC could merge with one of its Vision Fund investments. It really shouldn’t.
Chris Bryant – Bloomberg
It seems like everyone’s launching a special purpose acquisition company these days, but you could have bet on Softbank Group Corp. maestro Masayoshi Son and his lieutenant Rajeev Misra finding a way of putting an eyebrow-raising spin on the blank-check phenomenon. They haven’t disappointed.
/bloom.bg/3nOhbEC

Goldman Revs Up Legal Machine to Take On Main Street Borrowers
Shahien Nasiripour and Max Abelson – Bloomberg
Consumer arm is filing first wave of claims in the pandemic; Guidance counselor, used car salesman caught in crosshairs
For decades, Goldman Sachs Group Inc. avoided getting tangled up in the finances of everyday Americans, preferring to deal with the world’s most influential governments and corporations.
/bloom.bg/2WFE0ye

BNP Paribas Asset Management appoints Luiz Sorge as Head of Latin America
BNP Paribas
BNP Paribas Asset Management (‘BNPP AM’) announces the appointment of Luiz Sorge as Head of Latin America, with effect from 1 January 2020. He will be based in São Paulo and will report to Sandro Pierri, Global Head of Client Group (‘GCG’).
/bit.ly/37INnU8

Regions

A new breed of social media influencers is simplifying stock markets for Indians;
New technology is upending everything in finance, from saving to trading to making payments.
Prathamesh Mulye – Quartz India
Kshitiz Bhutani, a media professional based in Mumbai, has recently tasted success in the stock market. As a first-time investor, much of what Bhutani has learned about trading and investing in shares is not through the traditional routes like brokers and financial advisors, but via YouTube.
/bit.ly/34FsWFD

Cargill to reopen Canadian beef plant after coronavirus outbreak
Reuters Staff – Reuters
Cargill Inc plans to begin reopening its Guelph, Ontario beef processing plant next week on Tuesday, days after it closed the facility due to an outbreak of COVID-19 infections among workers, the company said.
/reut.rs/37JEFFm

Danes Now Richer Than Before Pandemic With $930 Billion Fortune
Christian Wienberg – Bloomberg
Danes are now richer than ever after their financial wealth surpassed the level before the pandemic. Danish households had net financial assets — mainly in the form of stocks and bonds — of 5.66 trillion kroner ($930 billion) in the third quarter, the central bank in Copenhagen said in a report on Wednesday.
/bloom.bg/2KNLWuz

Italy Is the Darling of the Bond World for 2021
James Hirai and Jill Ward – Bloomberg
Commerzbank, JPMorgan see Italy spread below 100 basis points; Italy will be among biggest beneficiaries of EU recovery fund
As European bond strategists draw up their top trades for 2021, one popular theme rises above the rest: load up on Italy’s long-dated debt. Commerzbank AG, JPMorgan Chase & Co., HSBC Holdings Plc and UBS Group AG are targeting a continued decline in Italy’s 10-year yield premium over bunds, while Deutsche Bank AG prefers positioning for a flatter bond curve relative to its German equivalent. Robeco Institutional Asset Management is opting for the country’s 50-year notes.
/bloom.bg/3pgIpUy

Brexit

Brexit Deal in the Balance as Negotiators Push for the Line
Ian Wishart and Nikos Chrysoloras – Bloomberg
Nine months of talks between the U.K. and European Union over a post-Brexit trade accord are hanging in the balance, with officials trying to bring them to a conclusion as soon as Wednesday. Prime Minister Boris Johnson and European Commission President Ursula von der Leyen intervened personally Monday and Tuesday, holding several phone conversations in a last-ditch bid to reach an agreement before the U.K. leaves the single market at the end of the month.
bloom.bg/3ridFV7

Brexit: Johnson and EU chief in ‘close contact’ over trade deal push
BBC News
Boris Johnson and the EU’s Ursula von der Leyen are in “close contact” as the two leaders try to seal a trade deal before talks break up for Christmas. Fishing access and fair competition rules remain key sticking points. Housing Secretary Robert Jenrick told the BBC an agreement was possible before the end of 2020 but further movement was required from the EU. Time is running out to clinch a deal before the 31 December deadline, when the UK leaves the EU’s trading rules.
bbc.in/3pk6REx

Northern Ireland looks south as Brexit takes bite out of UK trade links
Padraic Halpin, Kate Holton – Reuters
As a major supplier of food in Northern Ireland, Lynas Foodservice is sourcing more goods such as cheese from across the open border with EU-member Ireland to avoid the bureaucratic trade hurdles being erected with Britain after Brexit.
reut.rs/3mFp0e9

No Brexit trade deal yet as serious issues remain, British minister says
Guy Faulconbridge, Gabriela Baczynska – Reuters
The United Kingdom and the European Union have still not clinched a Brexit trade deal to avoid a turbulent split in just eight days time because of serious disagreements about competition and fishing, a British minister said on Wednesday.
/reut.rs/3mIWpot

U.K. Risks Vegetable Shortages as French Ban’s Impact Lingers
Deirdre Hipwell and Richard Weiss – Bloomberg
Incoming loads depend on trucks still stuck at Dover port; Lufthansa may increase air freight of fresh foods to U.K.
British supermarkets are bracing for potential fresh-produce shortages after Christmas, as the ripple effect of France’s two-day ban on entry courses through a supply system built on fast turnarounds.
/bloom.bg/3nKlj8h

Brexit poses grave risks to UK health and care sector, report finds
PA Media via The Guardian
The UK’s health and care sector faces a perilously uncertain future after Brexit, a report has said. The Nuffield Trust thinktank stated: “The perilously uncertain future facing the UK at the end of the Brexit transition period could put the UK’s health and care system at risk.” The report said new migration rules, possible disruption to medicines and devices, an ongoing economic slowdown and barriers to science investment would hit the health sector.
bit.ly/2WETu5t

Britain, Canada strike short-term deal to avoid post-Brexit tariffs
Reuters Staff – Reuters
Canada and Britain said they struck a short-term deal on Tuesday to ensure that free trade between the two after Brexit can continue until the Canadian parliament approves a new bilateral agreement. As Britain prepares to end its transition out of the European Union on Dec. 31, it has negotiated many roll-over bilateral deals to maintain trade, including with Canada. But Canada’s House of Commons failed to ratify the document in time, meaning the two nations would in theory have had to impose tariffs on each other starting on Jan 1.
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Dutch exporters fear fruit will rot if Brexit deal not done
Reuters staff – Reuters
With the clock running down on negotiations over a Brexit trade deal, Dutch fruit and vegetable exporters fear that a failure to strike an agreement could lead to long customs queues and fresh produce rotting in trucks.
The Netherlands exported about 2 billion euros’ ($2.4 billion) worth of fruit and vegetables to Britain last year, and its port, Rotterdam, is the main hub for cargo passing from other EU member states to Britain. If Britain crashes out of the EU without a trade deal, its imports of fresh produce will be subject to time-consuming health and customs checks.
reut.rs/3phhIiz

Miscellaneous

Publishers Feel Validated by States’ Google Antitrust Lawsuit; Accusations by Texas and nine other states give ground to publishers’ frustrations that the digital-ad economy is rigged
Keach Hagey – WSJ
For more than a decade, Google assured publishers its online advertising tools were designed to help them make more money. Many were skeptical. Last week, an antitrust lawsuit by Texas and nine other states against Google gave publishers’ frustrations a legal voice, alleging that the tech giant runs a digital advertising monopoly and rigs the market in its favor.
/on.wsj.com/3h9YXLa

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