Treasury urges SEC, CFTC crack down on crypto industry in wide-ranging new reports

Sep 16, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

This is a year of many celebrations. The National Futures Association yesterday had a celebration of 40 years of the NFA and of Dan Driscoll‘s service to the NFA.

Optiver is celebrating the launch of its first-ever Global Optiver Academy in Amsterdam. In this four-week program, graduates from Optiver’s Chicago, Sydney, Taiwan, London and Amsterdam offices have come together to complete the first leg of their training as a single cohort before returning to their local offices to join their new teams. In addition to classroom training sessions, the new joiners are experiencing the best of what Amsterdam has to offer. Applications for Optiver’s 2023 graduate program are now open.

Singapore Exchange CEO Boon-Chye Loh is swapping his work attire for this SGX Group football jersey and taking to the pitch for SGX Cares Bull Charge Charity Futsal 2022. After a two-year hiatus due to the pandemic, the fun returns for the fundraising initiative that has raised $44 million since 2004.

The OCC posted a video to YouTube about Ovation, OCC’s new clearing platform.

The Cboe recently released their 4th annual ESG report.

The Digital Dollar Project is hiring.

InCubex created a YouTube channel on September 7 and posted four videos to it, including one titled “RECs: A brief overview of the basics of RECs, how they work and how they are traded”, which explains what a renewable energy certificate is.

The Malta Stock Exchange plc will host the WFE’s General Meeting and Annual Meeting from the 27th to the 29th of September 2022. For more information, go HERE.

Chris Grams, who left the CME Group in July as senior director of corporate communication, is now senior director, corporate & financial communications at Macy’s.

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


World Ozone Day is being observed around the globe today, September 16, to mark the signing 35 years ago of the Montreal Protocol on substances that deplete the Ozone layer. Lauded as a success of global cooperation, the Montreal Protocol has removed 99% of harmful ozone-depleting substances preventing a full-blown crisis. But the ozone is still not fully protected. You can learn more from The Hole, a film on the Montreal Protocol, narrated by Sir David Attenborough. You can watch the film HERE. ~SAED


MWE SHORT: Jim Hourihane – Careers in Compliance

In this video from MarketsWiki Education’s Intern Recruiting Event in Chicago, Jim Hourihane, compliance manager for the National Futures Association, breaks down how the NFA works and what kind of opportunities present themselves in compliance. With mountains of data in the financial sector, one of the goals of the NFA is to make sure that market and member data is safe and secure. Hourihane says the NFA’s new challenge is going international and making sure they can work within the structure of other countries’ regulations.

Watch the video »


The Search for Intelligent Life Is About to Get a Lot More Interesting; There are an estimated 100 billion galaxies in the universe, home to an unimaginable abundance of planets. And now there are new ways to spot signs of life on them.
Jon Gertner – The New York Times
When the space shuttle Atlantis lifted off from the Kennedy Space Center on Oct. 18, 1989, it carried the Galileo in its cargo bay. Arrayed with scientific instruments, Galileo’s ultimate destination was Jupiter, where it would spend years in orbit collecting data and taking pictures. After it left the shuttle, though, Galileo headed in the other direction, turning toward the sun and circling around Venus, in order to slingshot around the planet and pick up speed for its journey to the outer solar system. Along the way, it flew around Earth too — twice, in fact, at altitudes of 597 and 188 miles. This gave its engineering team an opportunity to test the craft’s sensors. The astronomer Carl Sagan, a member of Galileo’s science team, called the maneuver the first flyby in our planet’s history. It also allowed him to contemplate what a spacecraft might find when looking at a far-off planet for signs of intelligent life.

****** I used to go on a search for intelligent life every Friday night in bars in Wisconsin. It was a difficult search, especially as the night wore on and the beer intake increased. ~JJL


Prospect of queue to join queue as Queen mourners told capacity reached
Emily Dugan – The Guardian
People are continuing to enter Southwark Park to queue to see the Queen lying in state, despite a government announcement that they should come back later. Entry to the queue to see the Queen lying in state was supposed to have been paused for at least six hours after it was declared at capacity.

****** The line was so long, it was the longest allowed. ~JJL


Spat Out by Crypto, Tech Staff Find They Are in High Demand
Aisha S Gani, William Shaw and Anna Irrera – Bloomberg
No sooner had the 32-year-old developer joined Coinbase Global Inc. than he was on his way out. The developer, who asked not to be identified talking about his workplaces, joined the largest cryptocurrency exchange in the US last year from a tech giant. He was lured by a base salary of $175,000 and a generous stock option package. Back then, the crypto markets were riding high.

****** It is a good economy for people with skills. ~JJL


It Was 30 Years Ago Today, George Soros Taught the Bank to Play; A crisis with the pound on Black Wednesday produced an early form of Brexit that shocked the world. And now? When global imbalances are this entrenched, interventions should be resisted with a stiff upper lip.
John Authers – Bloomberg
Happy Black Wednesday Friday. Margaret Thatcher always used to say that “you can’t buck the markets.” Having in 1990 been dragged very much against her will into joining the exchange rate mechanism of the European Monetary System (in which other EU currencies traded in a fixed band around the deutsche mark in what was intended as a precursor to the euro), she appeared to gain vindication 30 years ago today, when the UK government abandoned its attempt to keep the pound within the mechanism and let it float — which in practice meant that it let the currency collapse.

****** It was 30 years ago the market boogeyman was created?


Thursday’s Top Three
Our most-clicked story Thursday was The New York Times’ Crypto’s Long-Awaited ‘Merge’ Reaches the Finish Line, about the Ethereum “Merge,” which is all over the news today as well. Second was the Futures for Kids FFK Fun Run 2022. Third was The Wall Street Journal’s SEC Proposes to Push More Treasury Trades Into Clearinghouses.


MarketsWiki Stats
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MarketsWiki Statistics


Lead Stories

Treasury urges SEC, CFTC crack down on crypto industry in wide-ranging new reports
Jennifer Schonberger – Yahoo Finance
The U.S. Treasury is warning in three new reports that cryptocurrencies pose meaningful risks for consumers, investors, and businesses if not properly regulated. The government is also recommended moving forward with work on a central bank digital currency, but stopped short of recommending one. The reports encourage the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) to “aggressively” pursue investigations and enforcement actions against crypto companies that aren’t in compliance with laws.

Pricing of Stock Trades Varies Widely Among Popular Brokers, Study Finds; TD Ameritrade delivered best prices in professors’ experiment, while Interactive Brokers lagged behind
Alexander Osipovich – The Wall Street Journal
Brokerages aren’t created equal when it comes to getting investors a good deal on trades. A recent academic study found wide disparities in the prices that investors get when buying and selling stocks through a half dozen popular brokerages. TD Ameritrade delivered the best prices, the study found, followed by Fidelity Investments, E*Trade and Robinhood Markets Inc. In a surprise to some investors, at the bottom of the pack were a pair of trading platforms from Interactive Brokers Group Inc.—a brokerage catering to day traders that has long touted its execution quality. “The difference in execution costs between these different brokers is huge, and nobody knows it,” said Christopher Schwarz, a finance professor at the University of California, Irvine, and lead author of the study, which came out last month.

Retail Trading Boom Cools as Cost-of-Living Crisis Hits Europe; IG Group reported 27% drop in new clients in latest quarter; Morgan Stanley sees downside for Avanza, Hargreaves Lansdown
Jonas Ekblom and Joe Easton – Bloomberg
Retail trading platforms are getting hit as Europe’s cost-of-living crisis tightens purse strings for amateur investors, ending a pandemic-era boom for the sector. UK contract-for-difference firm IG Group Holdings Plc said on Thursday that new client numbers dropped 27% in the quarter ending August 31. The trend is being replicated elsewhere, with Sweden’s Avanza Bank Holding AB reporting recently that net new customers fell 66% in the first half of the year.

SEC Climate Rule Won’t Demand Extensive Reporting From Small Businesses, Gensler Says; Small businesses have expressed concerns they would be forced to embark on an accounting mission to provide data to their public-company customers
Richard Vanderford – The Wall Street Journal
A proposed climate disclosure rule wouldn’t require public companies to ask small private suppliers to report on their carbon footprints, Securities and Exchange Commission Chairman Gary Gensler said, responding to concerns about compliance costs. Public companies reporting emissions linked to their supply chain—known as Scope 3 emissions—can estimate the carbon footprint of small suppliers and still comply with the proposed rule, Mr. Gensler said Thursday at a U.S. Senate oversight hearing.

U.S. SEC’s crypto guidelines push up costs for lenders, disrupting projects
Hannah Lang and Michelle Price – Reuters
Banks’ cryptocurrency projects have been upended by U.S. Securities and Exchange Commission (SEC) accounting guidance that would make it too capital-intensive for lenders to hold crypto tokens on behalf of clients, according to more than half a dozen people with knowledge of the matter.

Justice Department Forms National Network of Prosecutors Focused on Crypto Crime; New effort is part of trend toward putting more resources to target illegal activities involving digital currencies
Dustin Volz – The Wall Street Journal
The Justice Department has tapped more than 150 federal prosecutors across the country to bolster law enforcement’s efforts to combat the rise in crime linked to the use of cryptocurrencies such as bitcoin, officials said. The Digital Asset Coordinators Network is intended to designate subject-matter experts in U.S. attorneys’ offices on the complex technical and legal complications posed by cryptocurrency cases, the officials said. The Biden administration is announcing the new effort Friday alongside the release of a broader set of frameworks from other agencies concerning regulatory approaches to developing the digital currency ecosystem.

US Yield Curve Set to Invert by Most in 40 Years, Allspring Says; Inversion of two-, 10-year yields may reach most since 1980s; What Fed may say next week is ‘really worrying:’
Jacobsen Tassia Sipahutar – Bloomberg
A crucial part of the US Treasury yield curve risks inverting even more to a level last seen in the early 1980s as the economy inches closer to a recession, according to Allspring Global Investments. Two-year yields are likely to surge in the next six months, increasing the inversion with 10-year yields to at least 100 basis points, said Brian Jacobsen, senior investment strategist at the firm. The yield gap at that part of the curve stood at minus 44 basis points on Friday, the deepest in a month, data compiled by Bloomberg show.

Treasury recommends exploring creation of a digital dollar
Fatima Hussein – Associated Press
The Biden administration is moving one step closer to developing a central bank digital currency, known as the digital dollar, saying it would help reinforce the U.S. role as a leader in the world financial system. The White House said on Friday that after President Joe Biden issued an executive order in March calling on a variety of agencies to look at ways to regulate digital assets, the agencies came up with nine reports, covering cryptocurrency impacts on financial markets, the environment, innovation and other elements of the economic system.

Arrest warrant issued for ‘Lunatic’ crypto baron behind this year’s $40 billion crash
Rich Stanton – PC Gamer
Do Kwon is one of the most bullish and energetic crypto advocates out there. As the co-founder and CEO of Terraform Labs, he would in better times take on critics and puff the crypto future to the high heavens: and he was a convincing guy, too, persuading many that the Terra ecosystem was where it’s at.

Crypto poses threat to ‘financial stability’ of everyday Americans, Biden administration warns in new report
Chris Matthews – MarketWatch
President Joe Biden’s administration expressed concern over recent developments in cryptocurrency markets and their impact on average Americans’ financial health as it introduced a series of reports Friday outlining policy recommendations for regulating digital assets. Recent turmoil in crypto markets “highlight how, without proper oversight, cryptocurrencies risk harming everyday Americans’ financial stability and our national security,” Brian Deese, director of the National Economic Council, told reporters at Thursday evening press conference.

CFTC Already Preparing to Be Crypto Watchdog, Behnam Tells US Senators
Jesse Hamilton – CoinDesk
Rostin Behnam, the head of the U.S. Commodity Futures Trading Commission, said he has already directed his agency to begin preparing to be the major, fully funded regulator for much of the crypto market, as anticipated in Senate legislation.

SEC’s Crypto Guidance Pushes US Banks to Rethink Custody Projects: Report
Sandali Handagama – CoinDesk
Guidance issued by the U.S. Securities and Exchange Commission on how lenders should treat customers’ digital assets is disrupting the banks’ crypto projects, Reuters reported, citing people familiar with the matter. In March, the SEC said all U.S.-listed public companies that function as crypto custodians should account for their crypto exposure as liabilities instead of assets on their balance sheets and disclose risks associated with those liabilities to investors. The custody of crypto assets by lenders presents unique technological, legal and regulatory risks compared with other assets, the SEC guidance said.

Ether’s New ‘Staking’ Model Could Draw SEC Attention; SEC chairman says system used by ether following software update could trigger securities laws
Paul Kiernan – The Wall Street Journal
Ethereum’s big software update on Thursday may have turned the second-largest cryptocurrency into a security in the eyes of a top U.S. regulator. Securities and Exchange Commission Chairman Gary Gensler said Thursday that cryptocurrencies and intermediaries that allow holders to “stake” their coins might pass a key test used by courts to determine whether an asset is a security. Known as the Howey test, it examines whether investors expect to earn a return from the work of third parties. “From the coin’s perspective…that’s another indicia that under the Howey test, the investing public is anticipating profits based on the efforts of others,” Mr. Gensler told reporters after a congressional hearing. He said he wasn’t referring to any specific cryptocurrency.

Ether Miners Are Piling Up Losses As ‘Merge’ Shifts Them to Altcoins; Ethereum’s upgrade eliminates its lucrative mining industry; Miners migrate to other coins, turning margins negative
David Pan – Bloomberg
Ether miners are piling up losses after shifting to lower value cryptocurrencies such as Ethereum Classic and Ravencoin, in the wake of an Ethereum network upgrade that rendered much of their operations obsolete. The upgrade, known as the ‘Merge’, replaced powerful graphic cards used by Ether miners with investors who stake Ether, in order to secure the Ethereum network and validate transaction data encrypted by the blockchain.

SEC Chair Gensler Raises Concerns Over ‘Staking’ Model on Ethereum
Lydia Beyoud – Bloomberg
Crypto investors who have been celebrating this week’s overhaul of Ethereum’s blockchain may have to deal with an unwelcome guest at their party: US Securities and Exchange Commission Chair Gary Gensler. Gensler on Thursday signaled that a feature of the network’s software could lead to tokens being considered securities by the SEC. While Gensler was careful to say he wasn’t speaking about any digital coin specifically, his comments add to questions about the Wall Street regulator’s views on Ether, which is the second-biggest virtual currency.

U.S. Senate grills SEC’s Gensler over climate rule, crypto stance
Pete Schroeder and Michelle Price – Reuters
U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler defended his agency’s position on cryptocurrencies and its push to include climate risks into public company disclosures before the U.S. Senate Banking Committee on Thursday. Gensler appeared before the panel for its regular oversight duties, but the hearing comes at a time of Republican frustration over his agenda. They claim he has overstepped his authority with a broad assault on U.S. capital markets and adopted a hostile stance toward the financial industry.

The Next Financial Crisis May Already Be Brewing—but Not Where Investors Might Expect
Joseph Adinolfi – Barron’s
A growing number of traders, academics, and bond-market gurus are worried that the $24 trillion market for U.S. Treasury debt could be headed for a crisis as the Federal Reserve kicks its “quantitative tightening” into high gear this month. With the Fed doubling the pace at which its bond holdings will “roll off” its balance sheet in September, some bankers and institutional traders are worried that already-thinning liquidity in the Treasury market could set the stage for an economic catastrophe—or, falling short of that, involve a host of other drawbacks.

FTX Is in the Lead to Buy Crypto Lender Voyager Digital’s Assets Out of Bankruptcy: Source
Ian Allison, Tracy Wang – CoinDesk
Exchange giant FTX is in the lead to buy the assets of Voyager Digital, the cryptocurrency lender whose bankruptcy filing deepened this year’s industry crisis, but higher offers could still come in in the days ahead, according to a person familiar with the matter. An auction was held this week through bankruptcy court for Voyager’s assets. At the final stage it was a battle between billionaire Sam Bankman-Fried’s FTX exchange and Wave Financial, a digital-asset investment firm, according to the person.

The World Has a $1 Trillion La Nina Problem; It’s all but guaranteed the world will see another year of weather disasters that destroy homes, ruin crops, disrupt shipping and threaten lives.
Brian K. Sullivan and Sybilla Gross Green – Bloomberg
Deadly floods in Pakistan. Scorching heat and wildfires in the US West. Torrential rains in Australia and Indonesia. A megadrought in Brazil and Argentina. As climate change pushes weather disasters to new extremes, it’s La Nina, an atmospheric phenomenon, that has been the driver behind the chaos since mid-2020. And now the planet stands on the cusp of something that’s only happened twice since 1950 – three years of La Nina. Another year of La Nina means the world is hurtling toward $1 trillion in weather-disaster damages by the time 2023 wraps up. The floods, droughts, storms and fires will destroy more homes, ruin more crops, further disrupt shipping, hobble energy supplies and, ultimately, end lives.

Tech giants’ dive follows a new Cult of Performance; Remember the lessons of the Nifty Fifty and the MegaCap-8 when you invest over the next few years — price matters
Merryn Somerset Webb – Financial Times
Back in 1967 a man calling himself Adam Smith wrote a wonderful book called The Money Game. Smith — actually a professional investor called George Goodman writing under a pseudonym — devotes one chapter to what he called “The Cult of Performance”. In it, he describes the shift that took place in fund management in the 1960s.

Securities lending reg reforms could hike European buy-side trading costs by EUR40 billion, report finds; Credit Benchmark found cost of capital for banks could rise fivefold when undertaking securities financing activity with pension and mutual funds.
Annabel Smith – The Trade
Trading costs for the European buy-side could be set to hike up by up to EUR40 billion due to new securities lending regulation, a report by Credit Benchmark has found. Incoming Basel regulation due to come into play in 2025 is expected to see high quality credits that have no external rating jump in risk weight to 100%. The rise will result in a dramatic increase in capital requirements.

Ukraine Invasion

Germany takes control of 3 Russian-owned oil refineries
Associated Press
Germany is taking control of three Russian-owned refineries in the country to ensure energy security before an embargo on oil from Russia takes effect next year, officials said Friday. The Economy Ministry said in a statement that Rosneft Deutschland GmbH and RN Refining & Marketing GmbH will be put under the administration of Germany’s Federal Network Agency. As a result, the agency will also control the companies’ shares in three refineries: PCK Schwedt, MiRo and Bayernoil, located in the east and south of the country.

Russian Invasion Knocked Out 14% of Ukraine’s Grain Storage; US-backed report warns of threat to future global food supply; Farmers ‘don’t have anywhere to put the grain’: researcher Courtney McBride – Bloomberg
Russia has destroyed, damaged or seized control of 14% of Ukraine’s crop storage facilities since invading in February, jeopardizing the global food supply and threatening future harvests, a US government-backed report said Thursday. Researchers examined satellite images of 344 storage facilities — out of almost 1,400 nationwide — and concluded that Ukraine’s grain storage capacity fell to 49.8 million metric tons, down from a pre-war capacity of 58 million metric tons.

North Korean Weapons Supplied to Russia Would Likely Have Limits; U.S. says Moscow could potentially purchase millions of rounds from Pyongyang, but most are old and unsophisticated
Dasl Yoon – The Wall Street Journal
North Korea has stockpiles of munitions to assist Russia’s military as the Ukraine war grinds on, but weapons experts say they are old and Kim Jong Un’s regime would face problems providing Russia with the more sophisticated weaponry it has been developing. The U.S. said last week that Russia could potentially purchase millions of rounds of ammunition from North Korea. White House national-security spokesman John Kirby called it an indication of how desperate President Vladimir Putin had become. He said the purchase hadn’t occurred yet but that U.S. intelligence indicated that it could include rockets and artillery shells. Vassily Nebenzia, Russia’s ambassador to the United Nations, said it was his first time hearing of the purchase and that he thought the report was false.

Pope says supplying weapons to Ukraine is morally acceptable for self defence
Philip Pullella – Reuters
Pope Francis on Thursday said it was morally legitimate for nations to supply weapons to Ukraine to help the country defend itself from Russian aggression. Speaking to reporters aboard a plane returning from a three-day trip to Kazakhstan, Francis also urged Kyiv to be open to eventual dialogue, even though it may “smell” because it would be difficult for the Ukrainian side. The war in Ukraine, which Russia invaded on Feb. 24, provided the backdrop to the pope’s visit to Kazakhstan, where he attended a congress of religious leaders from around the world.

Ukraine says mass grave found in Izium where Russians ousted days ago
Tom Balmforth – Reuters
Ukrainian authorities found a mass grave containing 440 bodies in the northeastern town of Izium that was recaptured from Russian forces days ago, officials said, including some people killed by shelling and air strikes. Thousands of Russian troops fled Izium last weekend after occupying the city and using it as a logistics hub in the Kharkiv region. They left behind large amounts of ammunition and equipment. “Mass graves are being discovered in Izium after liberation from the (Russians)”, with the largest burial site holding 440 unmarked graves, the Ukrainian defence ministry tweeted.

Ukraine continues to consolidate its control in Kharkiv area, UK says
Britain’s defence ministry said on Thursday that Ukrainian forces continue to consolidate their control of newly liberated areas of Kharkiv Oblast. Russian forces have largely withdrawn from the area west of the Oskil River, the British Defence Ministry said in its daily intelligence bulletin on Twitter. High-value equipment abandoned by retreating Russian forces included capabilities essential to enable Russia’s artillery-centric style of warfare, the tweet added.

Don’t Play Russian Roulette With Oil in the Baltic Sea; Denmark will keep piloting Putin’s tankers through the Danish straits.
Javier Blas – Bloomberg
Every day, dozens of oil tankers cross the narrow waterway. It’s a linchpin of global trade. Shut it down and gasoline prices spike everywhere. Right now, geopolitical tension is high, and the navies of many great powers have warships patrolling it.

Exchanges, OTC and Clearing

CME Group Announces Record Volume as Participation in Aluminum Futures Accelerates
CME Group
CME Group, the world’s leading derivatives marketplace, today announced that Aluminum Futures average daily volume is up 359% in Q3 to-date from Q1, reaching a record single-day volume of 6,709 contracts on Wednesday, September 14, 2022. “We have seen an increase in demand from aluminum participants to enhance liquidity and create a more robust alternative market,” said Jin Chang, Managing Director and Global Head of Metals at CME Group. “We are pleased with the incremental strides we have made in growing our global Aluminum Futures, with average daily volume of approximately 3,700 contracts so far in September and open interest of approximately 1,000 contracts. We welcome our new clients and look forward to helping them manage their price risk more efficiently.”

CME Group FX Futures and Options Reach New Volume and Open Interest Records
CME Group
CME Group, the world’s leading derivatives marketplace, today announced its foreign exchange futures and options reached a new single-day volume record of 3 million contracts on Sept. 14, 2022. This was the first time CME Group FX futures and options traded more than 3 million contracts in a single day and was 7% higher than the previous record of 2.8 million contracts set on Dec. 3, 2020. Open interest (OI) for CME Group FX futures and options also reached a record high of 3.3 million contracts on Sept. 8, 2022, up 17% year-on-year and reflecting a notional value of around $295 billion.

Equity Derivatives: Introduction of Equity Options, Single Stock Futures and Single Stock Dividend Futures; Eurex Circular 090/22 Equity Derivatives: Introduction of Equity Options, Single Stock Futures and Single Stock Dividend Futures
Introduction The Management Board of Eurex Deutschland took the following decisions with effect from 4 October 2022: Introduction of ten Equity Options pursuant to Annex B to the Contract Specifications (Attachment 2); Introduction of 34 Single Stock Futures pursuant to Annex A to the Contract Specifications (Attachment 2); Introduction of two Single Stock Dividend Futures pursuant to Annex D to the Contract Specifications (Attachment 2); Further changes to Annexes to the Contract Specifications for Futures Contracts and Options Contracts at Eurex Deutschland pursuant to Attachment.

Futures trading in commodities not leading to price rise, says study; India has lost the opportunity to become a price setter amid changing dynamics in the agri-commodities market
Prabhudatta Mishra – Hindu Business Line
There is no conclusive evidence to show that derivatives trading leads to higher prices or that the suspension/ban had any effect on bringing down the price volatility, according to a research study by a group of academicians. The report has come amid demand for allowing futures trading in some commodities where a ban has been imposed. The study also said the country has lost the opportunity to become a price setter amid changing dynamics in the agri-commodities market, after the Covid pandemic. The suspension of futures trade makes the country dependent on international markets such as Chicago Board of Trade (CBOT) or Inter Continental Exchange (ICE) for reference prices, it said.

Notice Of Disciplinary Action
Effective Date 15 September 2022. Member: Hector Santos. Cme Rule Violations: CME Rule 521. Requirements for Open Outcry Trades (in part) In open outcry trading, bidding and offering practices must at all times be conducive to the competitive execution of transactions. All open outcry transactions, including spread and combination transactions, shall be made openly and competitively in the pit designated for the trading of the particular transaction. No bid or offer shall be specified for acceptance by a particular trader. Transactions may take place only at the best price available in the open outcry market at the time the trade occurs.

United Nations Sanctions (Democratic People’s Republic of Korea) Regulation
Holders of Stock Exchange Trading Rights and Exchange Participants are requested to note that the updated list of individuals and entities under the United Nations Sanctions (Democratic People’s Republic of Korea) Regulation was published on the website of Commerce and Economic Development Bureau (“CEDB”) on 15 September 2022.


Broadridge Partners with Coinbase on Integrated Trading Solution
Broadridge Financial Solutions, Inc.
Bringing liquidity and greater access to crypto trading, global Fintech leader, Broadridge Financial Solutions, Inc. ( NYSE: BR), has announced a partnership with Coinbase, offering interoperability between Coinbase Prime and Broadridge Trading and Connectivity Solutions’ NYFIX order-routing network. “Despite short-term cycles, momentum in institutional adoption is trending one way – toward more exploration and more interest,” said Greg Tusar, Vice President of Institutional Products at Coinbase. “Utilizing the NYFIX order-routing network, this partnership puts deep, multi-venue crypto liquidity on more buy-side traders’ desks, lowering barriers for participation in this growing asset class.”

Zoom says issue with joining meetings on its platform resolved
Zoom Video Communications Inc said on Thursday it had resolved the problem that was preventing users from starting and joining meetings, after more than 40,000 users reported issues with the video-conferencing platform., a website which tracks outages by collating status reports from several sources including user-submitted errors on its platform showed 40,377 users reporting problems. The actual number of users affected could vary.


Uber investigating ‘cybersecurity incident’ after hacker claims to access internal systems
Sean Lyngaas – CNN Business
Uber said Thursday that it was investigating a “cybersecurity incident” after a hacker shared evidence that they had breached the ride-hailing giant’s computer systems with journalists and security researchers. “We are currently responding to a cybersecurity incident,” Uber’s communications team said in a tweet Thursday evening. “We are in touch with law enforcement and will post additional updates here as they become available.”

The White House is on a cyber bender
Tim Starks – The Washington Post
The capstones on this week’s cybersecurity bender arrived today, with the White House touting $1 billion in cybersecurity aid to state and local governments and a threat briefing for the aviation industry. Earlier this week, the White House issued an executive order on vetting foreign investments in the United States for cybersecurity and other risks, published a memo on the development of secure software and followed through on a threat to take action against Iranian hackers. But the steps have, in some cases, have gotten a mixed reception.

US Cyber-Defense Agency Urges Companies to Automate Threat Testing; Automated approach is still ‘not very widespread,’ agency says
Katrina Manson – Bloomberg
The US government’s cyber defense agency is recommending for the first time that companies embrace automated continuous testing to protect against longstanding online threats. The guidance, from a cluster of US and international agencies published on Wednesday, urges businesses to shore up their defenses by continually validating their security program against known threat behaviors, rather than a more piecemeal approach.

China looks to increase penalties under its cybersecurity law
China’s cyberspace regulator on Wednesday proposed a series of amendments to the country’s cybersecurity law including raising the size of fines for some violations, saying that it wanted to do so to improve coordination with other new laws. The Cyberspace Administration of China (CAC) said, for example, that it wanted to introduce a penalty that would see operators of critical information infrastructure which used products or services that had not undergone security reviews be fined up to an equivalent of 5% of their previous year’s revenue, or 10 times the amount they paid for the product.

White House releases post-SolarWinds federal software security requirements
Justin Doubleday – Federal News Network
Agencies will require software vendors to self-certify that they’re following secure development practices under new White House guidance, but it leaves the door open for departments to mandate third-party security assessments as well. The new guidance from the Office of Management and Budget, “Enhancing the Security of the Software Supply Chain through Secure Software Development Practices,” stems from last year’s cybersecurity executive order.

How SOCs distribute cybersecurity alerts to avoid burnout
Sergey Soldatov – Security Magazine
As cyber threats become more advanced, enterprise security operations centers (SOCs) are finding themselves inundated with challenges. Amid that landscape, organizations are also having to deal with a lack of security talent, professional burnout and tight budgets to help with their primary goal of protection, with 40% of organizations reporting that they struggle with staff shortages, and less effective SOCs reporting a lack of investment in technology, training and staffing to do their jobs well.


‘I think we’ll be right’: Scaramucci dishes on SkyBridge deal with FTX inked during Andrea Bocelli concert in Italy
Alexandra Semenova – Yahoo! Finance
Anthony Scaramucci signed the paperwork for his recent deal with crypto billionaire Sam Bankman-Fried the only way “The Mooch” could — at an Andrea Bocelli concert in Italy. Last week, FTX Ventures and SkyBridge reached an agreement that saw the venture arm of Bankman-Fried’s crypto exchange take a 30% stake in SkyBridge, Scaramucci’s alternative investment firm. The financier is heading to the Bahamas this weekend to meet with Bankman-Fried and “lay out the goals” for SkyBridge and FTX’s partnership, Scaramucci told Yahoo Finance in a sit-down interview at the SALT conference on Wednesday.

Ethereum Faces ‘Blockchain Trilemma’ as ‘Merge’ Mania Cools; Crypto network transitioned to more energy-efficient system; Network must now seek to implement major scaling upgrades Sidhartha Shukla – Bloomberg
After much celebration over the successful transition of Ethereum, the question remains what’s next for the most commercially-significant crypto project. The long-awaited software revision, termed the Merge, shifted the blockchain from a so-called proof-of-work system to a more energy efficient proof-of-stake method for securing the network. There was no changes related to network transaction costs or speed, which are common gripes among Ethereum users.

Crypto Spawns Its Own Lingo as Investors Talk the Talk
Rob Lenihan – The Street
Are you a soy boy or a bag holder? Do you have diamond hands? And are you ready for the Flippening? As if cryptocurrency isn’t confusing enough already, the digital dough has spawned its own language. Given crypto’s history of wild rides, a lot of investors probably have words of their own they’d like to use — most of which have four letters. Language is an ever-changing thing, with words and expressions going in and out of fashion with brain-busting speed.

Another Crypto Exchange is Trying to Go Public Through a SPAC. It Faces Long Odds.
Luisa Beltran – Barron’s
Crypto markets are in disarray, but that doesn’t appear to be stopping another exchange from trying to go public through a special purpose acquisition company, or SPAC. Far Peak Acquisition (ticker: FPAC) has tried for over a year to close its merger with Bullish, a crypto exchange that aims to compete against rivals like Coinbase Global (COIN), FTX, and Binance.US. The SPAC resubmitted a registration statement with the Securities and Exchange Commission on Friday, filling a 700-page document to try to persuade the SEC to approve the deal.

Crypto Lending Company Celsius Files for Permission to Sell Its Stablecoin Holdings
Sam Reynolds, Nikhilesh De – CoinDesk
Crypto lending firm Celsius Network, which is currently in Chapter 11 bankruptcy proceedings, has asked the court for authorization to sell its stablecoin holdings in order to generate liquidity to help fund its operations, according to new court filings.

SEC Chair Gensler, CFTC Chair Behnam Testify Before Lawmakers; Do Kwon Developments
CoinDesk TV’s crypto news roundup includes CFTC Chairman Rostin Behnam and SEC Chair Gary Gensler testifying before lawmakers in separate hearings. Plus, South Korea’s Ministry of Foreign Affairs is looking to invalidate Terra co-founder Do Kwon’s passport, according to a local media report.

Vitalik Buterin Says Ethereum Merge Cut Global Energy Usage by 0.2%, One of Biggest Decarbonization Events Ever
Aoyon Ashraf – CoinDesk
The Ethereum Merge lowered the world’s energy consumption by 0.2%, according to the blockchain’s co-founder Vitalik Buterin, marking what may be one of the single biggest decarbonization efforts in history. The overhaul cut Ethereum’s energy use by 99.988% and carbon-dioxide emissions by 99.992%. The decrease means the network now spews out less carbon dioxide (CO2) than a few hundred U.S. households do during a full year of electricity use, according to a new report from the Crypto Carbon Ratings Institute (CCRI).

Thailand bans crypto lending and staking services
Pradipta Mukherjee – CoinDesk
The Thailand Securities and Exchange Commission (SEC) has prohibited cryptocurrency companies from offering digital assets lending and staking products, or depository services.

Galaxy Digital sued for $100 mln for ditching landmark Bitgo deal
Tom Hals – Reuters
Galaxy Digital Holdings Ltd, a crypto financial services firm, should pay at least $100 million in damages for walking away from its $1.2 billion takeover deal for BitGo Inc, the digital asset custodian said in a court filing made public on Thursday. Galaxy ended the takeover, the first billion-dollar crypto deal, because it was reeling from the collapse of digital currencies but falsely blamed BitGo’s accounting, according to the lawsuit by BitGo that was filed on Tuesday under seal.

Cryptocurrency Exchange Gemini Names Insider as Compliance Chief; Christopher Mariadason’s promotion is the latest change in the company’s risk and compliance team in recent months
Mengqi Sun – The Wall Street Journal
Gemini Trust Co. has promoted an insider to the post of chief compliance officer, the latest change in the cryptocurrency exchange’s risk and compliance team in recent months. Christopher Mariadason, who joined Gemini as the head of program governance in June of last year, is its new compliance chief, a spokeswoman for Gemini said Thursday.

Hard-Hit NFTs See Surge in Sales After Ethereum Merge; Bored Ape Yacht Club, CryptoPunk sales soar as demand jumps; Global NFT sales declined 675% in August from last year
Hannah Miller – Bloomberg
The price of the world’s second-largest cryptocurrency by market value, Ether, and other digital assets are down, but it’s a different story for nonfungible tokens following the long-awaited upgrade of the Ethereum blockchain. Sales and prices of NFTs have surged, according to crypto data tracker DappRadar. The upgrade, known as the Merge, also seems to have benefited marketplaces that sell NFTs based on Ethereum, which is the most popular blockchain for this type of token.

Matthew Ball on the Huge Metaverse Opportunity
Sumit Roy –
The metaverse might not be as trendy a topic as it was back in October when Facebook famously rebranded itself as Meta, but it’s still a massive investment opportunity, according to Matthew Ball, chief executive officer of Epyllion. Epyllion is the majority shareholder in Ball Metaverse Research Partners, which provides the index behind the $482 million Roundhill Ball Metaverse ETF (METV), the largest of seven U.S.-listed metaverse ETFs. Speaking at the Future Proof Wealth Festival in Huntington Beach, California, Ball cited figures from various investment banks estimating that the metaverse economy could be worth anywhere from $2.5 trillion to $16 trillion by the end of the decade.

JPMorgan: China’s Metaverse-Related Economy Could Reach $4T
Will Canny – CoinDesk
The metaverse – an immersive digital world created by the combination of virtual reality, augmented reality and the internet – will have “profound implications” for China and will affect gaming, advertising and e-commerce, JPMorgan said in a research report last week. The digital world will offer an improved user experience across various internet business models, and this could lead to increased user penetration and average revenue per user (ARPU), the report said. The bank’s bullish scenario suggests that the metaverse could triple China’s online-gaming market to $131 billion from $44 billion.


Biden’s Executive Order Produces Few Answers in Crypto Reports From US Treasury
Jesse Hamilton, Nikhilesh De – CoinDesk
Crypto firms have been eagerly awaiting a series of U.S. government reports they hoped would clarify what the Biden administration and regulators intend to do about digital assets. Most of the documents are out now, but the picture remains murky.

SEC Chair Gary Gensler on Disclosures for Crypto
During the SEC oversight hearing, Chair Gary Gensler responds to a question from Senator Cynthia Lummis (R-Wyo.) about the use of disclosures to protect crypto investors, drawing comparisons with practices from traditional investing.

Republicans grill SEC Chair Gensler over climate change rules, crypto regs
Jennifer Schonberger – Yahoo Finance
SEC Chair Gary Gensler faced a grilling from Republicans on climate disclosure rule proposals and crypto regulations at a hearing before the Senate Banking Committee on Thursday. Ranking Member Senator Pat Toomey (R-PA) accused the Biden administration of using the SEC as a tool to advance a liberal agenda, pointing to newly proposed climate-related disclosure rules.

Biden Issues New Order to Block Chinese Investment in Technology in the U.S.; The move, which is bound to heighten tensions with Beijing, reflects growing unease about China’s ability to access the personal information that Americans hand over to mobile apps and other services. David E. Sanger – The New York Times
President Biden signed an executive order on Thursday designed to sharpen the federal government’s powers to block Chinese investment in technology in the United States and limit its access to private data on citizens, in a move that is bound to heighten tensions with Beijing. The new order is designed to focus the actions of the secretive Committee on Foreign Investments in the United States, created by Congress nearly a half-century ago. For years the committee’s powers were limited largely to blocking the foreign acquisition of American firms that might have a direct impact on national security — a military contractor, for example.

Toomey tells SEC chief to be ‘on notice’ that Supreme Court may overrule new climate rule; Gensler argues that proposed climate rule is limited in scope
Chris Matthews – MarketWatch
Republicans on the Senate Banking Committee took aim at Securities and Exchange Commission Chair Gary Gensler’s plan to implement a new rule requiring disclosure of climate change risks during a hearing Thursday. The SEC voted in March to propose a new rule requiring public companies to report risks related to climate change and their own greenhouse gas emissions, in an effort to standardize such disclosures and provide investors with useful information. Sen. Pat Toomey of Pennsylvania, the committee’s top Republican, admonished Gensler for failing to provide “real answers” to written questions submitted to the SEC by GOP senators on how the agency developed the proposal. He also predicted that the Supreme Court would toss out the rule if it is ultimately implemented.

Trump asked his Homeland Security secretary to eliminate the entire 9th Circuit Court of Appeals, book says
Grace Panetta – Insider
President Donald Trump asked his Secretary of Homeland Security Kirstjen Nielsen to write a bill to eliminate an entire federal Circuit Court of Appeals after it ruled against him, according to an upcoming book by The New York Times’ Peter Baker and The New Yorker’s Susan Glasser. The West Coast-based Ninth Circuit, one of the most liberal circuits, became a frequent target of Trump’s ire, the authors detail in the book “The Divider,” which Insider obtained ahead of its September 20 publication. Trump raised the idea of simply abolishing the court altogether after it ruled against one of his administration’s policies seeking to more easily deport asylum seekers in 2018, according to the authors. “Let’s just cancel it,” Trump told Nielsen, instructing her that if such a move required legislative action, to write a bill to “get rid of the fucking judges” and send it to Congress, the book said.

The harsh reality conservatives refuse to acknowledge
Kristin Rowe-Finkbeiner – CNN
Moms, women and caregivers are beyond angry — we’re overwhelmed, out of time and ready to vote. The midterms are coming, and American women are registering to vote at record levels, and according to polling, many are motivated by the fight for abortion rights and the crushing blows of having to persist without a care infrastructure. Something has to give — because moms, women and families can’t give any more. It can’t be overlooked that while regularly discounted, dismissed and underpaid — moms are the people who make things happen in their families, in their workplaces, and in their communities, including motivating friends, adult children, other family members and their community members to vote. And, to be clear, moms aren’t only a motivating force, they are also a voting force: A full 86% of women become moms in the US, making nearly 75 million registered voters mom voters.

US to Start Review of Chinese Audit Documents Next Week, Gensler Says; SEC Chief says American inspectors about to fly to Hong Kong; Reviews are move to avoid delisting of 200 firms from US
Lydia Beyoud – Bloomberg
US watchdogs will review the audit documents of Chinese businesses that trade in New York starting next week, according to Securities and Exchange Commission Chair Gary Gensler. The inspections, which will take place in Hong Kong under a preliminary agreement reached between American and Chinese regulators, are a first step to avoiding the delisting of about 200 firms from US markets. Their possible removal stems from Beijing’s longstanding refusal to let the US Public Company Accounting Oversight Board review the audit work papers of firms based in China and Hong Kong.

Liz Truss plans last-ditch bid to persuade SoftBank to list Arm in London; UK prime minister to push for talks with Japanese owner of British tech company
Daniel Thomas, Anna Gross and Jim Pickard and Leo Lewis – Financial Times
Prime Minister Liz Truss and chancellor Kwasi Kwarteng are preparing to launch a last-ditch charm offensive to persuade Japan’s SoftBank to list British tech company Arm in the UK. The government will push for high-level talks with SoftBank executives after the official period of mourning for the Queen ends next week, according to officials with knowledge of the situation.

The Truss government sends a signal to the City; Bonus cap was always a misguided policy but there is political cost to scrapping it
The editorial board – Financial Times
The bonus cap was imposed by the EU in the wake of the financial crisis to try to temper excessive risk-taking by bankers. Since then, it has had the perverse effect of driving up fixed pay, thereby diluting the discretion of regulators in dealing with wayward traders and hobbling banks’ ability to cut costs in downturns. The UK has long been against the cap, even mounting a legal challenge against the EU (eventually withdrawn) over its implementation. Repealing it after Brexit has been on the to-do list of the last two governments, but they viewed the political risks as too great. Now Kwasi Kwarteng, the new chancellor in Liz Truss’s government, wants to push ahead, despite the unfortunate optics of doing so during a cost of living crisis. His decision is ultimately the right one.

The government will need to do better than Big Bung 2.0; The bonus cap isn’t an effective measure but nor does scrapping it amount to a radical reform agenda
Helen Thomas – Financial Times
Did Big Bang 2.0 just become Big Bung 2.0? The government hopes that lifting the cap on bankers’ bonuses, introduced by the EU after the financial crisis, will serve as a statement of intent for its plans to rejuvenate the City. Certainly, the industry is enjoying some political warmth after a decade out in the cold since the financial crisis, finding itself sidelined in the Brexit negotiations and highlighted as the antithesis to the last government’s mantra of levelling up. But the idea of ditching the bonus cap also underlines the lack of fresh thinking in what is supposedly a post-Brexit banner policy.


SEC Sues ‘Chicago Crypto Capital,’ Employees for Illegally Selling BXY Tokens
Cameron Thompson – CoinDesk
The U.S. Securities and Exchange Commission (SEC) on Wednesday sued a Chicago-based crypto investments company and three employees for allegedly selling $1.5 million in cryptocurrencies that weren’t registered with the investments regulator. Chicago Crypto Capital (or CCC) owner Brian Amoah and salesmen Darcas Oliver Young and Elbert Elliott sold cryptos called BXY tokens to 100 investors, many of whom had no prior crypto experience, from August 2018 to September 2019, according to the complaint. They misled those investors about how they were handling the token, the complaint said.

Justice Department Targets Executive Pay, Probationary Deals to Curb Corporate Crime; Deputy Attorney General Lisa Monaco outlines policy changes that push companies to claw back pay from executives involved in wrongdoing and limit use of deals letting businesses avoid criminal charges
Dylan Tokar, Dave Michaels – The Wall Street Journal
The Justice Department will push companies to claw back compensation from executives involved in bribery and fraud and limit the use of probationary deals that allow companies to avoid criminal charges, in a bid to adopt a tougher stance on white-collar crime. The new policies—part of a expansive list of changes to how the department prosecutes companies that run afoul of the law—were outlined in a memo issued by Deputy Attorney General Lisa Monaco on Thursday. Ms. Monaco, who was appointed by President Biden and took office last year, announced the policy overhaul during a speech at New York University’s law school.

Keynote Address of Commissioner Summer K. Mersinger: An Appropriate Regulatory Regime for Evolving Markets
Summer K. Mersinger – CFTC
As prepared for delivery at the American University Web3 Summit: “Thank you so much to American University and the Global Blockchain Business Council for inviting me to speak on such an important topic today. I am excited to discuss the regulatory implications of Web3 and blockchain, interested to hear the thoughts and perspectives of so many industry leaders, and am particularly looking forward to staying on for our panel discussion on the ‘New Era of Finance.'”

Testimony of Chairman Rostin Behnam Regarding the Legislative Hearing to Review S.4760, the Digital Commodities Consumer Protection Act at the U.S. Senate Committee on Agriculture, Nutrition, and Forestry
Chairwoman Stabenow, Ranking Member Boozman, and members of the Committee, I appreciate the opportunity to appear before you today as Chairman of the Commodity Futures Trading Commission (CFTC or Agency) to discuss S.4760, the Digital Commodities Consumer Protection Act (“DCCPA”). Before I begin, I would like to recognize and thank my fellow CFTC Commissioners and colleagues; their dedication, expertise, and commitment to the American public ensures our greatest success.[1]

CFTC’s Division of Data Announces Limited Modifications to the Technical Specification for Parts 43 and 45
The Commodity Futures Trading Commission’s Division of Data (DOD) today announced it has published limited modifications to Version 3.0 of the CFTC Technical Specification, issued in September 2021. The Technical Specification provides detailed instructions for swap data reporting and public dissemination requirements under Parts 43 and 45 of the CFTC’s regulations. The Technical Specification includes the definitions, formats, and allowable values for data elements that are to be reported to swap data repositories (SDRs).

U.S. Senate grills SEC’s Gensler over climate rule, crypto stance
Pete Schroeder and Michelle Price – Reuters
U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler defended his agency’s position on cryptocurrencies and its push to include climate risks into public company disclosures before the U.S. Senate Banking Committee on Thursday. Gensler appeared before the panel for its regular oversight duties, but the hearing comes at a time of Republican frustration over his agenda. They claim he has overstepped his authority with a broad assault on U.S. capital markets and adopted a hostile stance toward the financial industry. But in prepared testimony released ahead of the hearing, Gensler insisted his new rules are critical to ensuring the U.S. capital markets remain the global “gold standard.”

Testimony Before the United States Senate Committee on Banking, Housing, and Urban Affairs
Chair Gary Gensler – SEC
Good morning, Chairman Brown, Ranking Member Toomey, and members of the Committee. I’m honored to appear before you today as Chair of the Securities and Exchange Commission. I’d like to thank this Committee for helping to confirm our two new Commissioners, Mark Uyeda and Jaime Lizárraga. As is customary, I will note that my views are my own, and I am not speaking on behalf of my fellow Commissioners or the staff.

Laudable Ends, Poorly Pursued: Statement Regarding Recent Pay-to-Play Rule Settlements
Commissioner Hester Peirce – SEC
Today the Commission instituted and settled administrative proceedings against four investment advisers for violating the Pay-to-Play Rule.[1] The Rule, adopted in 2010, came in response to instances where government entities, such as state and municipal pension plans, were choosing investment advisers based on their political contributions. When adopting the Rule, the Commission observed that “‘pay-to-play’ arrangements are inconsistent with an adviser’s fiduciary obligations, distort the process by which investment advisers are selected, can harm advisers’ public pension plan clients and the beneficiaries of those plans, and can have detrimental effects on the market for investment advisory services.”[2] The Pay-to-Play Rule was intended to “ensure that adviser selection is based on merits, not on the amount of money given to a particular candidate for office.”[3] The Commission characterized the Rule as being “closely drawn . . . to accomplish its goal of preventing quid pro quo arrangements while avoiding unnecessary burdens on the protected speech and associational rights of investment advisers and their covered employees.”[4] Today’s enforcement actions illustrate that the Rule is a poorly conceived means to pursue laudable ends. Accordingly, I dissent and urge the Commission to revisit the Pay-to-Play Rule to ensure that it does not hinder political engagement that is unconnected to an adviser’s quest for government clients.

SEC Charges Gol Intelligent Airlines, Brazil’s Second Largest Airline, with FCPA Violations
The Securities and Exchange Commission today charged Brazil’s second largest domestic airline, GOL Linhas Aéreas Inteligentes, for violating the Foreign Corrupt Practices Act (FCPA). The São Paulo-based company, also known as Gol Intelligent Airlines, agreed to pay $70 million to settle the SEC charges.

SEC Charges Promoter and Companies with $4 Million Fraud
The Securities and Exchange Commission today filed fraud charges against Gabriel Edelman and his affiliated entities, Creative Advancement LLC and Edelman Blockchain Advisors LLC, for fraudulently raising funds and misappropriating funds from investors.

SEC Charges Infrastructure Company Granite Construction and Former Executive with Financial Reporting Fraud
The Securities and Exchange Commission charged Granite Construction, Incorporated and its former Senior Vice President, Dale Swanberg, with fraud for inflating the financial performance of the major subdivision Swanberg managed. In 2021, Granite restated its financial statements from 2017 through 2019 to correct revenue and profit margin errors allegedly caused by Swanberg’s misconduct. The company agreed to pay $12 million to settle the SEC’s charges.

SEC Charges Real Estate Investment Firm and Principal with $100 Million Offering Fraud
The Securities and Exchange Commission today announced charges against Orange County, California-based Secured Income Group, Inc. (“SIG”), its 100% owner and president Max McDermott, and its investor relations representative Stacey Porter, who together raised approximately $100 million from hundreds of investors for SIG’s “Secured Debentures” offering between July 2017 and January 2021.

Court overturns 20-year ban against James Mawhinney, reinstates interim injunctions
The Full Federal Court has allowed an appeal by James Mawhinney to overturn a 20-year ban restraining him from advertising investments and raising funds from the public through financial products.
Mr Mawhinney is the director of various companies in the Mayfair 101 Group. On 19 April 2021, the Federal Court granted the restraining order against Mr Mawhinney after finding that he engaged in ‘serious, incompetent and reckless’ conduct (21-076MR). Mr Mawhinney appealed that decision.

Wellness industry director convicted of making false statement
Tatiana De Oliveira, also known as Tatiano De Oliveira, of Byron Bay, New South Wales, has been convicted of making a false or misleading statement to ASIC.
Between 8 June 2018 to 21 August 2020, Mr De Oliveira was the sole director of Shiera Wellbeing Centre Pty Ltd (ACN 626 309 939), a Brisbane-based business that provided alternative and holistic health and beauty services.

Investing and Trading

Sporttrade launches First and Only Regulated “Sports Trading” platform in New Jersey
Sporttrade Inc.
Sporttrade, a Philadelphia-based sports betting technology company, has officially launched its sports betting exchange in New Jersey. This positions Sporttrade as the first and only dynamic sports trading marketplace in the United States. Eligible customers can use Sporttrade to trade in and out of positions on sports outcomes much like they would trade stocks, options or cryptocurrencies.

Trading firm expanding, moving to Wacker Drive tower; Headlands Technologies is nearly tripling its office footprint and showing the premium some companies will pay for high-end workspace.
Danny Ecker – Crain’s Chicago Business
A growing trading firm founded by former Citadel executives is nearly tripling the size of its downtown office and moving it to one of the city’s newest office skyscrapers. Headlands Technologies has leased around 45,000 square feet on two of the top three floors in the 55-story tower at 110 N. Wacker Drive, a real estate broker for the company confirmed. Headlands will relocate to the new office from roughly 16,000 square feet it leases currently on the 46th floor of the office tower at 444 W. Lake St.

Japan’s Active ETF Push Faces Hurdles as Investors Flee; Bourse plans to launch active products amid liquidity worries; Investors say Japan’s ETF market is too small, lacks appeal
Aya Wagatsuma – Bloomberg
Japan’s foray into listing actively managed exchange-traded funds next year may do little to boost liquidity for a market faced with foreign outflows, investors say. The Tokyo Stock Exchange is planning to launch these ETFs in June as a way to stem thinning volumes and remain competitive against global peers, the bourse’s senior manager of equities Kei Okazaki said in an interview last week. The introduction comes after years of internal discussion on how to attract more foreign investors, he added.

LME Faces Suit from Funds Including AQR Over Nickel Crisis; AQR joined by DRW Commodities, Capstone and Flow Traders; LME says action is without merit and will oppose application
Katharine Gemmell, Mark Burton, and Jack Farchy – Bloomberg
The London Metal Exchange faces a lawsuit from a group of firms including hedge fund AQR Capital Management LLC over its decision to cancel billions of dollars worth of trades after a runaway short squeeze in nickel. AQR, DRW Commodities LLC, Flow Traders BV, Capstone Investment Advisors LLC, Winton Capital Management Ltd. filed a commercial court claim in London against the LME, according to court records made public this week.

Fund Manager Explains His ‘Cheat Code’ for the Bond Market; Spoiler alert: It’s really just fundamental analysis.
Michael P. Regan and Emily Graffeo – Bloomberg
George Cipolloni’s son is a video-game aficionado, and the teenager’s language has clearly worn off on his father. Indeed, the portfolio manager at Penn Mutual Asset Management jokes he’s found a “cheat code” in the bond market that’s helped his balanced strategy beat its benchmark with a heavy allocation to high-yield corporate debt. But don’t be alarmed: His “code” is really just fundamental analysis used to find bonds with attractive yields, but little risk. Cipolloni joined the latest episode of “What Goes Up” to discuss the strategy and offer his reaction to the wild ride in markets following the surprise inflation report on Sept. 13.

Ether Futures Market Discount Evaporates After the Merge
Omkar Godbole – CoinDesk
The month-long ether futures market anomaly that stemmed predominantly from traders looking to profit from Ethereum’s technological change, the Merge, has reversed. Ether (ETH) futures have almost caught up with the cryptocurrency’s underlying spot price following the historic overhaul of the way Ethereum verifies transactions.

Big Trading Houses Are Weathering Energy Crisis Battering Utilities; Merchants are now better placed to deal with margin call risks; Liquidity issues for some utilities sparked contagion fears
Archie Hunter and Anna Shiryaevskaya – Bloomberg
As wild swings in gas and power prices force European utilities to tap governments for emergency cash, trading houses are weathering the storm. The region’s energy crisis is whipsawing prices — gas futures surged as much as 35% on Sept. 5 alone — putting utilities in peril as margin calls of at least $1.5 trillion sucked cash from the sector. Similar price spikes earlier this year and in 2021 strained liquidity at top commodities merchants including Mercuria Energy Group Ltd., Gunvor Group Ltd, Vitol Group, Trafigura Group and Glencore Plc.

Repo Blew Up Three Years Ago and Funding Markets Are Still Weird; Financial system is contending with an abundance of cash; Lack of balance sheet, reserve scarcity triggered 2019 turmoil
Alex Harris – Bloomberg
It’s been three years since the turmoil in the market for repurchase agreements froze the funding universe and forced a Federal Reserve intervention. Yet risks still linger as another test approaches. Banks are drowning in the abundance of cash in the financial system as the result of pandemic-era fiscal and monetary stimulus. Meanwhile, there’s a lack of investable assets — like Treasury bills — that’s pushing overnight rates lower, and forcing eligible counterparties to park more than $2 trillion a day at the Fed’s reverse repo facility as the first and sometimes only resort.

Two-Man London Firm Scoops Up Russia Work Dumped by Big Banks; i2 becomes debt-market middleman for Gazprom, Polyus, Lukoil; Limerick-based firm takes up discarded shell companies
Tasos Vossos and Irene Garcia Perez – Bloomberg
Beaming from behind laptops in the shadows of a lounge bar, Sanjay Jobanputra and Mark Brescacin strike a casual pose in the sole photo on an Instagram account linked to their company. The former employees of BNY Mellon and advisory firm D.F. King are the founders of London – based firm i2 Capital Markets Ltd. You might not guess it from the informal snapshot and i2’s bare corporate website, but this summer they quietly took over the role of debt-market middlemen to the biggest companies in Russia.

The market is not an end in itself; If capitalism is to survive the political and social disruption, it will need to adapt as it has done in the past
Larry Kramer – Financial Times
The failings of the political and economic paradigm known as “neoliberalism” are now familiar. However well suited it may have been to addressing stagflation in the 1970s, neoliberal policy has since then fostered grotesque inequality, fuelled the rise of populist demagogues, exacerbated racial disparities and hamstrung our ability to deal with crises like climate change. The 2008 financial crash exposed these flaws and inspired a reassessment of how government and markets relate to society — an effort given fresh energy by the pandemic, which elicited a range of (successful) public actions at odds with neoliberal bromides.

European gas traders dare to dream prices have peaked; Some analysts expect ‘welcome reprieve’ in energy costs this winter before a rebound next summer
David Sheppard – Financial Times
European natural gas traders know the sector faces a tough winter ahead, but some have started to make a bold prediction: maybe, just maybe, prices have peaked for the year. The wholesale European gas price hit an intraday high of EUR343 per megawatt hour on August 26 — the equivalent in oil terms of almost $580 a barrel — but has since fallen to about EUR200/MWh.

Leaders in Trading 2022: Algorithmic Trading Awards shortlists unveiled; Winners of this year’s Algorithmic Trading Awards across eight categories will be announced during The TRADE’s flagship Leaders in Trading awards ceremony on 3 November.
Editors – The Trade
The TRADE is delighted to announce the shortlisted nominees for this year’s Algorithmic Trading Awards. The winners of the Algorithmic Trading Awards will be based on performance in The TRADE’s Algorithmic Trading Survey 2022, which was conducted earlier in the year.

Environmental, Social and Corporate Governance

BlackRock-Backed Biofuel Firm Says Timid Lenders Slow New Tech; Enerkem CEO says lenders struggle with lack of historical data; Company on track to reach positive cash flow in 2023: CEO
Esteban Duarte – Bloomberg
Enerkem Inc.’s waste-to-clean energy technology has attracted big name shareholders like BlackRock Inc. and Suncor Energy Inc. but its running into a roadblock in a quest for commercial loans. “It’s very difficult to find banks or ESG funds, which are willing to support new technologies,” said Dominique Boies, the biofuel company’s chief executive and financial officer in an interview. Lenders want to see a decade of data on production, but “it’s new technology, so it’s not been operating for 10 years.”

Air Canada Says Short-Haul Future Includes Electric Planes; Carrier will buy 30 planes from Sweden’s Heart Aerospace; Traffic is 80% of pre-Covid levels; business travel picking up
Mathieu Dion – Bloomberg
The head of Air Canada says the carrier will be able to offer zero-emission electric flights to customers in Canada as soon as 2028. The airline said Thursday it will purchase 30 ES-30 electric-hybrid aircraft for an undisclosed amount. The planes, which are being developed by Sweden-based Heart Aerospace AB, are “much more cost efficient” and could help the airline expand in regional markets, Chief Executive Officer Michael Rousseau sa id during remarks at the US Chamber of Commerce Global Aerospace Summit in Washington. United Airlines and Mesa Air Group have previously ordered 200 electric planes with an option for 100 more.

Cybersecurity + ESG for the Global Capital Markets; Implementing Cybersecurity Within The Nasdaq Environmental, Social, And Governance (ESG) Framework
Jonathan R. Everhart, Global ReEnergy Holdings via Harvard Law School Forum on Corporate Governance
This policy brief discusses cybersecurity from the corporate governance standpoint and illustrates how Nasdaq can implement cybersecurity into its ESG Reporting Guide, which is used by many public and private companies globally. The intersection of a company’s cybersecurity and ESG is a new corporate governance model.

After South African dam collapse, mine waste to be pumped into historical pit. Heritage concerns held back plans to backfill pit for years; Liquid tailings flooded town on Sunday when dam buckled; Jagersfontein is world’s oldest and biggest hand-dug mine pit
Nelson Banya and Helen Reid – Reuters
A South African company is dumping the sludgy byproduct of mining into a historical diamond pit after the tailings dam that had stored the waste partially collapsed, killing one and leaving scores injured. The government agency overseeing cultural preservation said on Thursday it approved plans to fill the historic Jagersfontein diamond mining pit with waste from a second compartment of the tailings dam in order to prevent a secondary breach after one compartment of the dam failed.

While the ozone layer is healing, pitfalls remain
United Nations Environment Programme
In 1987, the world came together to sign the Montreal Protocol, a global agreement to protect the Earth’s ozone layer. The accord was designed to phase out a host of chemicals, such as chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs), that were creating a continent-sized hole in the ozone layer above Antarctica. Today, the ozone layer is healing, shielding the planet from the potentially devastating effects of ultraviolet radiation. But while it may have slipped from the headlines, the ozone layer still remains under pressure, said Meg Seki, Executive Secretary of the Ozone Secretariat under the United Nations Environment Programme. “People tend to assume that the ozone hole is history, that we’ve done our job. Actually, we have a lot of challenges still ahead of us.”


U.K. Considers Letting Banks Pay Bigger Bonuses; The British government, led by new Prime Minister Liz Truss, is looking at ways to attract financial stars from New York and elsewhere
Josh Mitchell – The Wall Street Journal
The U.K. is considering a plan to allow banks to pay bigger bonuses to their star traders and bankers, the latest salvo in an intensifying competition between London and other financial hubs about where to trade and invest money. Since 2014, U.K. banks have been subject to European Union rules that restrict banks from paying bonuses of more than twice an employee’s salary. For bankers earning $500,000, that means they can get no more than a $1 million bonus.

Banker Who Brought Goldman Clout to SoftBank Starts Venture Bets; Former SoftBank strategy head invests in space and green tech; Masayoshi Son proteges now run their own VC investments
Min Jeong Lee and Takahiko Hyuga – Bloomberg
Before his abrupt departure from SoftBank Group Corp. last year, Katsunori Sago was seen as a potential successor to billionaire founder Masayoshi Son. He’s now charting his own course in startup investments. SoftBank’s ex-Chief Strategy Officer joins a growing cadre of Son’s former lieutenants who have caught the venture capital bug. Chief Operating Officer Marcelo Claure, who left earlier this year, is deploying billions through his family office. Rajeev Misra, who helped Son set up the initial Vision Fund, has stepped down from his role as a corporate officer and is launching his own fund.

Top Banks Pull Back From China Metal Financing After Crises; JPMorgan, ICBC Standard Bank cut credit lines to traders; The two banks are key lenders to China’s commodities sector
Archie Hunter, Alfred Cang, and Jack Farchy – Bloomberg
JPMorgan Chase & Co. and ICBC Standard Bank Plc are cutting back on financing to China’s troubled metals trade, adding pressure to a sector already hit hard by a struggling economy. At least three Chinese metal trading companies have had credit lines frozen or reduced by either of the banks in recent weeks, according to people familiar with the matter. The lenders have pulled back after a liquidity crisis emerged at top copper trader Maike Metals International Ltd., said the people, who asked not to be identified discussing private information.

Credit Suisse Trust’s Trial Admission Boosts Tycoon’s Case; Unexpected concession comes at end of second week of trial; Billionaire sued CS trust for $800 million in damages, losses
Hugo Miller – Bloomberg
A Credit Suisse Group AG trust admitted it failed to let its billionaire client know about unauthorized transfers from his accounts, in an unexpected move that may shape the outcome of a Singapore trial over the unit’s potential liability for losses tied to a rogue banker. Over the first nine days of the trial, Lee Eng Beng, the lead lawyer for Credit Suisse Trust (Singapore) Ltd., had argued that its responsibility was limited to administration of the assets belonging to Bidzina Ivanishvili and that it was the tycoon, or his Georgian business adviser, who called the shots on investment decisions and should be liable for any losses.

Hedge Fund Star Fuchs Fights to Recover From Soured China Bets; BFAM misread policy signs, got burned on property firm bonds; Fuchs’s troubles show even savviest investors got China wrong
Bei Hu – Bloomberg
Benjamin Fuchs was an Asia hedge fund star, managing $5 billion at his company’s peak. Now, the former Lehman Brothers Holdings Inc. trader is one of the highest-profile casualties of China’s property crisis and battling to turn his firm around. BFAM Partners (Hong Kong) Ltd.’s hedge fund lost almost 11% last year and a further 20% in the first seven months of 2022 as a series of bets on Chinese real estate developer bonds turned sour, after the firm mistakenly assumed the authorities would support the sector. While the losses aren’t existential or unique to BFAM, the company is bracing for possible redemptions and under pressure to retain staff.

Credit Suisse Funds CLOs in Bet on UK’s Wobbly Real Estate; Aeon Investments seals financing deal with bank for CRE CLOs; Firm aims to issue three CRE CLOs, starting next year
Adeola Eribake, Carmen Arroyo, and Jack Sidders – Bloomberg
Credit Suisse Group AG is financing a foray into a niche corner of the debt markets used to fund real estate at a time when UK property is feeling the strain from rising interest rates. The Swiss lender will furnish Aeon Investments Ltd with up to £900 million ($1.02 billion) to help bundle up loans and issue bonds secured against them known as commercial real estate collateralized loan obligations, Aeon’s co-founders Oumar Diallo and Ben Churchill said in an interview.

BNP Paribas’ former G10 rates head joins Mizuho Americas as head of macro trading; Incoming MD brings considerable experience to Mizuho, having previously served at BNP Paribas, Bank of America and Morgan Stanley over the last three decades.
Wesley Bray – The Trade
Mizuho Americas has appointed a former BNP Paribas executive as managing director and head of macro trading. David Moore joins Mizuho Americas after most recently serving as head of G10 rates Americas sales and trading at BNP Paribas.

Wellness Exchange

There’s Terrific News About the New Covid Boosters, but Few Are Hearing It
Zeynep Tufekci – The New York Times (Opinion)
For the first time, the United States is rolling out Covid vaccines updated to match variants that are currently dominant, as well as the original strain. This bivalent character will provide a better response not just to the most threatening variants today but probably to future variants too, because when the immune system faces different versions of the same virus it generates broader protections overall.

WHO ‘strongly advises against’ use of two COVID treatments
Natalie Grover – Reuters
Two COVID-19 antibody therapies are no longer recommended by the World Health Organization (WHO), on the basis that Omicron and the variant’s latest offshoots have likely rendered them obsolete. The two therapies – which are designed to work by binding to the spike protein of SARS-CoV-2 to neutralise the virus’ ability to infect cells – were some of the first medicines developed early in the pandemic. The virus has since evolved, and mounting evidence from lab tests suggests the two therapies – sotrovimab as well as casirivimab-imdevimab – have limited clinical activity against the latest iterations of the virus. As a result, they have also fallen out of favour with the U.S. health regulator.

EU regulator backs wider use of AstraZeneca COVID therapy
Pushkala Aripaka and Natalie Grover – Reuters
Europe’s medicines regulator has backed using AstraZeneca’s (AZN.L) preventative COVID-19 therapy as a treatment for the disease and also endorsed another medicine as preventative option for another common virus. The regulator’s recommendations are usually followed by the European Commission when it takes a final decision on drug approvals.

Can You Die of Old Age? More Doctors Are Saying Yes; In Japan, it is the No. 3 cause of death, and Queen Elizabeth II’s passing prompts discussion of the term’s appropriateness
Miho Inada – The Wall Street Journal
In announcing last week that Queen Elizabeth II died peacefully at age 96, Buckingham Palace didn’t give a cause. It hasn’t been publicly disclosed whether the queen suffered from a particular fatal ailment, but the circumstances pointed to a debate that has been growing in Japan, one of the world’s most aged nations. When a very old person dies without any obvious trigger, should doctors try to come up with a cause? Or is it acceptable to say that the person died of old age? Doctors are increasingly going with the latter.


Japan’s Top Refiner Is Gearing Up for the Oil Industry’s Decline; Eneos forecasts domestic fuel use to drop 50% by 2040; Company preparing to close some of its 10 refineries in Japan
Shoko Oda and Tsuyoshi Inajima – Bloomberg
Japan’s biggest oil refiner is drawing up plans to consolidate production as domestic demand slumps because of a shrinking population and efforts to cut emissions. Eneos Holdings Inc. has an outline for fusing operations but is still discussing which of its refineries to shutter when, President Takeshi Saito, who took over the helm of the Tokyo-based company in April, said in an interview. Eneos, which expects domestic fuel demand to slump 50% by 2040, has already announced a plan to close one of its 10 refineries next year.

The Bitcoin Gamble in the Central African Republic; The country’s attempt at becoming Africa’s top cryptocurrency destination has faced widespread skepticism
Victoria Vergolina – Bloomberg
By now you’ve probably heard that El Salvador became the first country in the world to adopt Bitcoin as legal tender in September 2021. Did you know the Central African Republic made a similar move in April, becoming the first country in Africa to welcome a cryptocurrency to its sovereign ranks? Not only did the decision cause disagreement and confusion within the country, it also drew skepticism and concern from organizations such as the International Monetary Fund and the World Bank.

Learning loss was steepest in school districts that stayed remote longest: Study
Alexander Nazaryan – Yahoo! News
Districts where schools stayed remote longer experienced more significant learning loss — but some of those losses are being reversed by states through effective teaching strategies. Those are the results, at once dismaying and hopeful, from a 10-state, district-by-district analysis conducted by Brown University economist Emily Oster as part of her long-standing effort to chronicle the pandemic’s deleterious impact on education. “It seems clear that there are opportunities to learn — especially about recovery,” Oster told Yahoo News. “The losses are what they are and I think the lesson of not moving to remote learning is widely accepted. But what works for recovery is really open.”


Janet Yellen Likes Rocks. Foreign Diplomats Keep Giving Her Stamps; Rumors have spread that the Treasury secretary is an avid stamp collector, but she doesn’t pursue the hobby
Andrew Duehren – The Wall Street Journal
When Janet Yellen was invited to join the likes of Queen Elizabeth II and Prince Albert of Monaco as one of only 100 individual members of the prestigious Club de Monte-Carlo, she felt she had to decline. The problem was the club is dedicated to collecting stamps. And despite widespread belief to the contrary, Ms. Yellen, the Treasury secretary, doesn’t collect stamps. Perfect gift? As Ms. Yellen explained in a 2017 letter declining the invitation, she inherited her mother’s stamp collection and was curious about stamp collecting, or philately, as a child. Since then, her interest had waned.

How I Am Reducing the Stress of Returning to Business Travel; Social anxiety. Covid worries. Family separation. I’m learning that there are ways to make it all a little bit easier.
Alexandra Samuel – The Wall Street Journal
As I loaded my laptop, iPad and toiletries back into my carry-on bag after passing through airport security, the fellow packing up next to me commented on one of my gadgets. Before I knew it, we were deep in conversation about our respective experiences in the tech world. After two years without business travel, I was ravenous for the excitement of establishing a new professional connection. But the flip side of excitement is anxiety—and my return to business travel has brought plenty of it. Do I still take taxis and limos, or will I commit to car rentals to avoid Covid risks and the nauseating experience of being a masked passenger? How will my kids handle my weeklong absence after two years of extreme togetherness? When is it worth the risk of taking off my mask in a room full of strangers? And of course: What on earth will I wear?

Sauvignon Blancs You Should Get to Know; If you hear Sauvignon Blanc immediately think Loire Valley or New Zealand, it’s time you expanded your horizons. Our wine columnist ventured farther afield and found well-made wines from less-expected locales.
Lettie Teague – The Wall Street Journal
Some grapes grow so well in certain places they overshadow the versions grown in other parts of the world. Take, for example, Sauvignon Blanc. Grown all over the globe, it’s best known for its French iterations in Bordeaux and the Loire Valley (each cited as its original home), as well as New Zealand, California and perhaps Chile too for drinkers looking to save a few bucks. But there are many terrific takes on the grape produced in much less familiar locales that deserve to be much better known. In my recent search I found some terrific examples in places as disparate as Macedonia, Greece, the Israeli-controlled Golan Heights and the Columbia Valley in Washington state, not to mention Australia’s Adelaide Hills and (coming full-circle to France) Burgundy. It’s also grown in Austria and Italy, though Sauvignon Blancs from those two countries proved oddly hard to track down.

Text Your Friends. It Matters More Than You Think. New research says most of us underestimate the power of the casual check-in.
Catherine Pearson – The New York Times
Calling, texting or emailing a friend just to say “hello” might seem like an insignificant gesture — a chore, even, that isn’t worth the effort. Or maybe you worry an unexpected check-in wouldn’t be welcome, as busy as we all tend to be. But new research suggests that casually reaching out to people in our social circles means more than we realize. “Even sending a brief message reaching out to check in on someone, just to say ‘Hi,’ that you are thinking of them, and to ask how they’re doing, can be appreciated more than people think,” said Peggy Liu, Ben L. Fryrear Chair in Marketing and an associate professor of business administration with the University of Pittsburgh Katz Graduate School of Business.

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China commodity trader woe a setback for Glencore

China commodity trader woe a setback for Glencore

First Read Hits & Takes John Lothian & JLN Staff Congratulations to Larry Tabb. STA announced Larry as the 2022 Dictum Meum Pactum (DMP) Award recipient. Here is a success story for you. The Greenwood Project placed four interns at Goldman Sachs this summer...

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