Hits & Takes
John Lothian & JLN Staff
Matt Leising announced that yesterday was his last day at Bloomberg, where he was a Los Angeles-based reporter covering the derivatives and crypto worlds. He has been with Bloomberg since 2004. Matt recently published his first book, which was crypto related and titled “Out of the Ether: The Amazing Story of Ethereum and the $55 Million Heist That Almost Destroyed It All.”
Leising announced he is off to do something in the crypto world, though he has not given any specifics. I am particularly grateful to Matt for his great reporting. There was a time when I believed he had assumed the mantle of most prolific derivatives reporter, taking over from former FT correspondent Jeremy Grant.
Mine was a symbiotic relationship with Matt and Bloomberg, as he told me JLN was his best distribution channel to connect with people in the listed derivatives space, since most did not lease Bloomberg terminals. Thus, if they were going to see his work, a good portion of it was through its inclusion in JLN.
Some of my favorite memories spent with Matt were during the Eurex press dinners at the FIA Boca Raton conferences when he and I and Jacob Bunge of Dow Jones would be seated at a table with former Eurex CEO Andreas Preuss and just keep Andreas laughing the whole night long. All the best, my friend Matt, onward and upward!
David Howson, EVP of Cboe Global Markets for Europe & Asia Pacific, reported on LinkedIn that Cboe LIS, Cboe’s European block trading platform powered by BIDS technology, achieved several milestones during August including being the largest venue of its type for the first time. The records include #1 Above-LIS Market Share, 30.6%; #1 Average Trade Size, EUR835,857; #1 Above-LIS Trade Count, 8151 Executions; Largest Single Trade, EUR72.3 million of Amadeus IT Group SA, August 17. Source: Big XYT Data from Conditional Dark Venue. More here.
Deutsche Börse Group is holding a webinar with our friends at Waters Technology on September 22, 2021 at 15:00 CET about “Leveraging information provider relationships to access high quality FX data.” Speaking at the webinar are Gerrit Marks, Head of Pricing & Licensing Strategy, Deutsche Börse; Lydia Solinski, FX Market Data, Product Manager, 360T Trading Networks; John Estrada, Global Head of eMacro, Credit Suisse; Tom Gentile, Director of Trading, Crabel Capital Management. It is moderated by Victor Anderson, Global Content Director, WatersTechnology. For more details and registration information, click HERE.
The inaugural FOW Japan conference will take place virtually on September 29-30, 2021. More details are available HERE.
Apple plans a blood pressure measure and wrist thermometer in its latest update to the iWatch. This will be very useful. — WSJ
There were no new donations to the JLN MarketsWiki Education GoFundMe campaign yesterday. Remember, your donations will be matched dollar for dollar by Trading Technologies.
We had a problem yesterday with the JohnLothianNews.com website, which was down for a while, and we did not post either the Options Solutions video or the Tom Price video. We hope to do so today after more testing on the site. Our apologies.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
The Secrets to Successful Crowdfunding; The failure rate of campaigns is high. Here’s how to improve your chances.
Christopher S. Tang – WSJ
Crowdfunding has helped many startups turn creative ideas into innovative products. But the failure rate of crowdfunding campaigns is high. Kickstarter, for instance, says about 61% of completed campaigns on its platform have failed. So, what can businesses do to improve their chances of success? They can start by ignoring the conventional wisdom that says entrepreneurs shouldn’t launch crowdfunding campaigns until their products are well developed, and almost ready for production.
***** Get a big crowd. Ask them for money. There is more?~JJL
6 qualities that will make you a more innovative employee; If you are not the kind of person who likes to break things, wear hoodies or black turtlenecks, or who likes to jump out of planes, worry not. The habits and profiles of true innovators are likely to look a lot more like you.
Kaihan Krippendorff – Fast Company
We tend to think innovators should fit a certain profile, one that looks suspiciously close to the innovators we most admire, write about, and study. We’ve seen Jeff Bezos with his clean-shaven head and shades or Steve Job’s signature black turtleneck and jeans. Richard Branson upset corporate suit culture with his relaxed, casual attire. It may seem that a world class innovator is supposed to challenge the status quo, care little about what others think of them, and act like a larger-than-life character.
*****Get a box. Don’t sit in the box when thinking.~JJL
Creating a larger, more liquid European equity derivatives market; Ahead of the launch of Cboe Europe Derivatives (CEDX), Ade Cordell, president of Cboe NL, and Conor McCann, head of European derivatives sales at SIG, which has committed to being a market-maker in CEDX index options products, discuss their expectations for the new market.
Ade Cordell, president, Cboe NL via The Trade
Cboe Europe Derivatives (CEDX) is a ground-breaking new pan-European equity derivatives marketplace which is launching on Monday September 6, 2021. Having secured the necessary regulatory approvals, CEDX is now in the final stages of its operational preparations and customer testing before its highly anticipated go-live.
***** Are you ready for some derivatives?~JJL
McDonald’s hiring 14-year-olds in Oregon amid labour shortage
The Biddle Road franchise in Medford put a banner outside its shop two weeks ago, urging younger workers to apply. According to reports, it has seen a spike in applications since making the offer, which complies with labour laws.
***** Don’t worry, the computers will put the 14-year-olds out of work soon.~JJL
Wednesday’s Top Three
Our top story Wednesday was Bloomberg’s FTX Acquires the First U.S.-Approved Crypto Derivatives Platform, about FTX.US acquiring LedgerX. FTX.US was also our MarketsWiki Page of the Day Wednesday. Second was The Wall Street Journal’s Energy Traders See Big Money in Carbon-Emissions Markets. Third was the Bloomberg opinion piece, Itching to Reinvent Your Career? Now Is the Time.
26,599 pages; 235,711 edits
U.S. SEC charges BitConnect founder with $2 billion cryptocurrency fraud
Jonathan Stempel – Reuters
The top U.S. securities regulator on Wednesday sued the founder of the now-defunct cryptocurrency exchange platform BitConnect over his alleged role in fraudulently raising about $2 billion from thousands of retail investors. Expanding a civil case announced in May, the U.S. Securities and Exchange Commission charged BitConnect founder Satish Kumbhani, an Indian citizen, with lying about BitConnect’s ability to generate profits, and violating registration laws meant to protect investors.
Germany’s Dax undergoes makeover as it expands from 30 to 40; Increase of companies in blue-chip index is welcomed but some want operator Deutsche Börse to reform further
Joe Miller – FT
Wirecard harmed more than duped investors when it collapsed into insolvency in 2020. The former high-flying start-up was one of just 30 blue-chip companies on Germany’s Dax index, having replaced Commerzbank two years prior, and its spectacular downfall cast a pall on the remaining members of this elite club.
OCC August 2021 Total Volume Up 30.8 Percent Compared to August 2020; Securities lending average daily loan value up 83.7 percent year over year
OCC, the world’s largest equity derivatives clearing organization, announced today that August 2021 total cleared contract volume was 805,713,175 contracts, up 30.8 percent compared to August 2020 and the highest August on record. Year-to-date average daily cleared contract volume through August was 38,839,193 contracts, up 36.4 percent compared to August 2020.
What Gary Gensler Really Meant With His Order Flow Remarks; The SEC chair is taking aim at market makers like Citadel and Virtu, not Robinhood and other brokers.
Aaron Brown – Bloomberg
Market participants may have misinterpreted comments by U.S. Securities and Exchange Commission Chair Gary Gensler about payment for order flow. Gensler told Barron’s that a ban on that practice is “on the table” because it generates “an inherent conflict of interest.” Shares of Robinhood Markets Inc., Charles Corp. and other brokerages most dependent on payment for order flow promptly dropped. But Gensler’s next sentences changed his meaning significantly, and Robinhood may not be the firm most at risk.
SEC Chair Warns Crypto Companies Against ‘Begging for Forgiveness.’ Why Investors Don’t Seem Worried.
Daren Fonda – Barron’s
Securities and Exchange Commission Chairman Gary Gensler has issued another warning to the crypto world: Ask for permission before launching a product, because forgiveness won’t be coming if you’re caught violating the rules. “There are a lot of platforms that are in operation today that would do better engaging [with us], and instead there is a bit of … begging for forgiveness rather than asking for permission,” Gensler said in an interview with the Financial Times published Wednesday.
Singapore Rolls Out SPAC Listing Rules as Global Scrutiny Rises
Ishika Mookerjee – Bloomberg
Singapore Exchange Ltd. has introduced a framework for blank-check companies to list in the city state, the latest bourse to host the vehicles whose popularity in global financial markets has surged over the past year.
Don’t expect major SEC attack on Robinhood business model, experts say
Chris Matthews – MarketWatch
Securities and Exchange Commission Chairman Gary Gensler got the attention of investors this week when he said that banning payment for order flow was an option “on the table” — but experts tell MarketWatch that it’s unlikely the regulator will take such a drastic step. In an interview with Barron’s, the SEC chief said the practice of payment for order flow — whereby stock brokers sell the privilege of fulfilling retail orders to market makers in return for a share of profits — results in “an inherent conflict of interest.” He noted that the U.K., Australia and Canada have all banned the practice and that a U.S. ban could be in the cards as well.
JPMorgan Settles French Tax-Fraud Case for $30 Million
Gaspard Sebag – Bloomberg
Allegations of tax fraud linked to investment firm Wendel; Probe dates back to 2007 financing involving Paris branch
JPMorgan Chase & Co. settled a longstanding French criminal investigation over allegations it helped clients commit tax fraud for 25 million euros ($29.6 million).
SEC Chairman Gensler Orders Review of Funds’ ESG Disclosures
Steven Arons – Bloomberg
SEC scrutiny follows probes into Deutsche Bank unit over ESG; Stricter ESG rules have investment firms struggling to adapt
The U.S. Securities and Exchange Commission is considering more stringent disclosure requirements for investment funds amid concerns that some in the industry are making unfounded ESG claims.
China hog stocks shed $75bn after swine fever recovery and ‘peak pork’; Consumers have switched to other proteins following price increases, say analysts
Hudson Lockett – FT
A resurgence of pork supplies in China following huge losses from African swine fever has wiped about $75bn off the country’s top hog-related equities, as the world’s largest pig farmers grappled with the possibility that Chinese consumers had passed “peak pork”.
Active traders are seeing their account balances continue to rise
Bob Pisani – CNBC
It’s good to be in an up market. A new Schwab report on self-directed brokerage accounts within 401(k) plans indicate that active traders have done well in the past year. The average account balance in the Schwab Personal Choice Retirement Account at the June was up by 22%, to $348,183 from $285,616 a year ago.
If U.S. had fought COVID like Denmark did, hundreds of thousands of Americans would be alive (Opinion)
Andres Oppenheimer – Miami Herald
Virtually nobody here wears a face mask on the street or inside shops and restaurants — a huge surprise. It’s almost as if the COVID-19 pandemic were a distant memory. As soon as I left the Copenhagen airport and took a taxi to the city, the driver — who was not wearing a mask — told me that I didn’t need to wear one in Denmark. “It hasn’t been required for several months,” he said. When we entered the city, I noticed that, indeed, almost no one was wearing a mask.
EU Authorities Say No Urgent Need For Covid Booster Shots
Naomi Kresge – Bloomberg
European Union health authorities said there’s no urgent need for widespread use of Covid-19 vaccine booster shots, though people with weakened immune systems should be offered a third dose.
Least-Vaccinated EU State Tightens Covid Measures as Deaths Jump
Slav Okov – Bloomberg
Bulgaria, the European Union’s least-vaccinated member state, will tighten restrictions on some service sectors in a bid to slow a wave of hospitalizations and deaths caused by Covid-19’s delta variant.
Britons with weak immune systems to be offered third Covid jab; Health secretary Sajid Javid stresses move is not the start of a booster programme
Oliver Barnes – FT
About 500,000 people in the UK with severely weakened immune systems will be offered a third dose of a Covid-19 jab in an effort to protect them from the virus ahead of the winter months, UK health secretary Sajid Javid said on Wednesday.
Surging Covid-19 Cases Hammer Asian Factories; Continuing struggles in region’s manufacturing sector could lead to higher prices for consumer goods such as shoes and electronics
Stella Yifan Xie and Jon Emont – WSJ
Factory activity faltered across Asia in August, with a resurgence in Covid-19 infections adding to global supply-chain disruptions and confirming fears of a slowdown in the region’s economic recovery.
More than 500,000 children tested positive for Covid-19 in 3 weeks. Experts say school mask mandates are needed
Travis Caldwell – CNN
The dramatic rise in Covid-19 cases and hospitalizations due to the more transmissible Delta variant is significantly impacting all age groups, particularly Americans ages 11 or younger who are not yet eligible to receive vaccinations.
Massive randomized study is proof that surgical masks limit coronavirus spread, authors say
Adam Taylor and Ben Guarino – Washington Post
The authors of a study based on an enormous randomized research project in Bangladesh say their results offer the best evidence yet that widespread wearing of surgical masks can limit the spread of the coronavirus in communities.
Exchanges, OTC and Clearing
HKEX to Collaborate with HKSTP on Biotech, Fintech Initiatives
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Thursday) it has signed a Memorandum of Understanding (MOU) with Hong Kong Science and Technology Parks Corporation (HKSTP), to explore new biotech and fintech initiatives. HKSTP is home to the city’s largest research and development base and a world-class innovation ecosystem, which will underpin the long-term growth of Hong Kong and the region as a global centre of excellence for biotech and new economy enterprises.
IEX Group Appoints Craig Resnick as Chief Financial Officer; Resnick brings more than 20 years’ experience working with high-growth companies in financial services
IEX Group today announced the appointment of Craig Resnick as Chief Financial Officer. In this role, Resnick will lead all financial functions for IEX, including accounting, audit, tax, treasury, corporate finance and investor relations.
ICE Mortgage Technology’s Marci Davis and Rebecca Frisbie Recognized for Industry-Leading Innovation; Female Leaders Named to Sixth HousingWire’s Annual Insiders List
Intercontinental Exchange, Inc.
ICE Mortgage TechnologyTM, part of Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today announced that ICE Mortgage Technology’s Marci Davis, Senior Director of Product Management and Rebecca Frisbie, Director of Product Management have been named to the 2021 list of HousingWire Insiders, which honors 100 operational superstars in housing who are driving their companies and clients forward.
Citadel operating chief in Asia departs for HKEX; New head of exchange operations and transformation has spent the last ten years in senior operations positions at Citadel and JP Morgan.
Annabel Smith – The Trade
The chief operating officer for Asia at Citadel has departed the US hedge fund after three years to join Hong Kong Exchanges and Clearing (HKEX) in a senior operations role. John Buckley will join the exchange operator in December as head of exchange operations and transformation, HKEX confirmed, reporting to chief operating officer, Calvin Tai.
Nasdaq to support Abu Dhabi Securities Exchange derivatives market launch; The US exchange has signed an agreement to deliver marketplace matching, clearing and settlement technology solutions to support the launch.
Annabel Smith – The Trade
Nasdaq has signed an agreement with the Abu Dhabi Securities Exchange (ADX) to support its launch of a derivatives market later this year. Under the terms of the agreement, the US exchange will offer technology solutions across matching, clearing and settlement.
Straits Times Index (STI) quarterly review – September 2021; No changes to the constituents of the STI
FTSE Russell announces that there will be no changes to the constituents of the Straits Times Index (STI), following the September 2021 quarterly review.
SGX introduces SPAC listing framework
Singapore Exchange (SGX) today announced new rules that enable Special Purpose Acquisition Companies (SPACs) to list on its Mainboard effective 3 September 2021.
MEFF launches a web-based FX derivatives trading platform for banking institutions
MEFF, the Spanish Derivatives Market, has launched BME FX, a web platform aimed at banks and other financial institutions, which will facilitate to hedge the currency risk with MEFF’s xRolling® FX futures contracts. BME FX consists of a technological solution that will allow banks and financial institutions to modernize their FX derivatives trading for institutional clients and corporates in a simple and cost-effective way, offering the possibility of deploying white-label terminals among their clients to hedge currency risk with xRolling® FX
The Spanish stock market trades 21.6 billion euros in August
The trading volume in equities is 8.7% higher year on year; Fixed Income trading rises to 15.09 billion euros, 33.2% more than in August 2020; Trading in Equity Futures contracts increased 109.8% and in Equity Options 30.1% from the previous month
The Spanish stock market traded 21.6 billion euros in Equities in August, 8.7% more year on year and 16.5% less than the previous month. The number of trades in August was 2.7 million, 18.7% less than in August 2020 and 26% lower than in July 2021.
— Various Amendments to the Bitcoin Futures, Micro Bitcoin Futures, and Ether Futures Contracts Including Enabling Basis Trade at Index Close (BTIC) Transactions and Reduction of Strike Price Listing Schedule for the Options on Bitcoin Futures Contract — CME
— EBS Market Integration onto CME Globex — CME
— CME Globex Notices: August 30, 2021 — CME
— CME STP Notices: September 2, 2021 — CME
ATEO To Launch A Crypto Initiative To Enhance The Crypto Market Data Feed Standardization
ATEO Finance, a leading provider of Post-Trade solutions for financial markets, has strengthened its Research & Development Department, creating a cryptocurrency lab to work on crypto exchange feeds standardization.
Telegram and Signal Will Never Match the Ubiquity of WhatsApp; The Facebook-owned messaging app has built an enormous social infrastructure over the past decade. Rivals hoping to replace it hardly stand a chance.
Parmy Olson – Bloomberg
The messaging app Telegram recently joined an exclusive club: It had its one billionth download, becoming one of about a dozen apps in the world to hit the milestone. Too bad that when it comes to mobile messaging, one name still rules them all.
Nationalization Is Coming to China’s Data Centers; Beijing is taking steps that will give the government not only access to, but purported ownership of, the vast amounts of information that companies collect.
Tim Culpan – Bloomberg
Anyone in China who creates, collects, stores, processes or sells data should consider themselves on notice: Nationalization is coming. Ant Group Co. is about to have its credit-scoring business taken over by stated-backed firms, Reuters reported Wednesday. It’s safe to say that the Alibaba Group Holding Ltd. affiliate itself doesn’t have much say in the matter. Under the restructuring, according to Reuters, Ant will become a minority holder in a joint venture that will own the fintech company’s repository of data on more than 1 billion users.
India Aims to Open Finance to Millions With New User Data System
Saritha Rai – Bloomberg
New approach designed to give more people access to banking; Lenders, fintech firms to benefit from bigger customer pool
India plans to unveil a data sharing system that could revolutionize investing and credit, giving millions of consumers greater access and control over their financial records and expanding the potential pool of customers for lenders and fintech companies.
CQG Connects to Brazilian Exchange B3 for Trading and Market Data
Trading solutions provider CQG has added Brazilian Exchange B3, one of the world’s largest financial market infrastructure companies, to its global network of exchanges, enabling clients to obtain trading and market data access to the Brazilian markets for their listed commodities, interest rates, treasury, and equities products. B3 futures contracts are now live on the system, and equities will be available within the next couple of weeks, according to Alli Brennan, Managing Director and Head of the Americas at CQG. “We’re currently onboarding many of the executing brokers in the Brazilian region, because international partners wanting access to B3 have to have a relationship with a broker in Brazil, so right now we’re going through that process,” says Brennan.
Former Turquoise business development head joins Instinet to head up APAC liquidity strategy; New head of liquidity strategy for Asia Pacific previously worked at HKEX and spent almost a decade at the London Stock Exchange Group’s Turquoise.
Annabel Smith – The Trade
A former head of business development at the London Stock Exchange Group’s trading venue Turquoise has joined Instinet to lead its liquidity strategy in Asia Pacific. Ian Lauder joins the agency broker from Hong Kong Exchanges and Clearing (HKEX) where he was senior vice president of global client development in the markets division for the last year and a half.
TP ICAP launches FX evaluated pricing solution; FX Evaluated Pricing launched by TP ICAP’s Parameta Solutions will deliver pricing for G10 currency pairs as well as linear instruments and FX options.
Annabel Smith – The Trade
TP ICAP has rolled out an FX pricing data solution through its recently rebranded data and analytics division, shortly after launching a similar tool for bond markets. Known as FX Evaluated Pricing (FEP), Parameta Solutions said the data will help FX traders make more accurate and timely decisions for price discovery and risk.
ByteDance says it will downsize fintech business, plans to sell stock broker ops
Beijing-based ByteDance, the owner of TikTok, said on Wednesday that it would shrink its financial services unit and that it planned to sell its stock broking operations amid China’s tightening grip on the financial technology (fintech) sector.
Report: Intuit may acquire Mailchimp for more than $10 billion; Bloomberg reports a possible tie-up between the small-business software companies, but whether it comes to fruition remains to be seen.
Steven Melendez – Fast Company
Intuit, the company behind TurboTax and the small-business accounting software QuickBooks, is in talks to buy Mailchimp for more than $10 billion, Bloomberg reports.
Robinhood Plans Early-Deposit Feature That Rivals PayPal
Mark Gurman and Annie Massa – Bloomberg
Option will let users get their paychecks up to two days early; Company also looking to bolster security with voice ID option
Robinhood Markets Inc. is working on a new feature that lets users receive their paychecks via direct deposit up to two days early, stepping up competition with companies like PayPal Holdings Inc. and Wealthfront Corp.
WhatsApp Fined $266 Million Over Data Transparency Breaches
Stephanie Bodoni and Katharine Gemmell – Bloomberg
Facebook-owned app’s first fine under EU data protection rules; Irish probe found problems with data-sharing communication
Facebook Inc.’s WhatsApp was ordered to pay a 225 million-euro ($266 million) penalty for failing to be transparent about how it handled personal information, its first fine under beefed-up European Union data protection law. The Irish Data Protection Commission — Silicon Valley’s main privacy watchdog in Europe — said it found violations in the way WhatsApp explained how it processed users’ and non-users’ data, as well as how data was shared between WhatsApp and other Facebook companies.
WhatsApp fined EUR225m for not telling users how it shared data with Facebook; Ireland applies one of the largest penalties for GDPR abuses after pressure from other European countries
Jude Webber and Javier Espinoza – FT
WhatsApp has been fined EUR225m for breaking the EU’s data privacy law by not telling its users how it was sharing their data with its parent company Facebook.
DoJ Launches Cybersecurity Fellowship Program as Threats Rise
Nathan Eddy – Security Boulevard
The U.S. Department of Justice (DoJ) announced the creation of a cybersecurity fellowship program that will train prosecutors and attorneys to handle emerging national cybersecurity threats. Fellows in the three-year Cyber Fellowship program will investigate and prosecute state-sponsored cybersecurity threats, transnational criminal groups, infrastructure and ransomware attacks and the use of cryptocurrency and money laundering to finance and profit from cybercrimes.
Microsoft’s Opportunity to Reinvigorate Security Leadership
Charles Kolodgy – Security Boulevard
The White House-hosted cybersecurity summit on August 25, 2021 was an opportunity for representatives from the private and public sectors to discuss how they can collaborate to address pressing information and computer security issues. Many of the leading technology companies, such as Amazon, Google, IBM and Microsoft, made commitments to expand cybersecurity funding and to help address the shortage of skilled cybersecurity professionals. Microsoft pledged to “invest $20 billion over the next five (5) years to accelerate efforts to integrate ‘cybersecurity by design’ and deliver advanced security solutions. This was, by far, the largest commitment from any of the leading cloud and information technology companies in attendance.
Hoolahan Bill Creates Cybersecurity Vocational Training Program – Daily Local
Timothy Schultz – Pennsylvania News Today
US House of Representatives Chrissy Houlahan (D-PA) and Anthony Gonzalez (R-OH) have introduced the Federal Cybersecurity Labor Expansion Act. This bicameral bicameral law strengthens the US cyber defense and cybersecurity workforce by creating two new training programs within the federal government. One of the training programs recruits veterans specifically for these demanding jobs.
Cybint partners with Xepto to bring cybersecurity bootcamp, workshops to the Philippines
Cybint, a global cyber education training company, partners with Xepto Education, the leading education tech company in the Philippines, to bring its cybersecurity bootcamp and workshops to the nation. Xepto will be managing the courses together with Mantua Cybersecurity, a major Philippine cybersecurity company offering penetration testing, consulting, and training services.
Promising Crypto Exchange FTX.US Acquires LedgerX To Enter US Bitcoin Derivatives Market
Samyuktha Sriram – Benzinga
FTX.US, the U.S.-based subsidiary of crypto exchange FTX, announced the acquisition of crypto derivatives exchange LedgerX. What Happened: According to a press release on Tuesday, FTX.US said it has executed a sale and purchase agreement to acquire Ledger Holdings Inc., the parent company of LedgerX LLC.
Binance founder Changpeng Zhao says its U.S. crypto exchange arm targets IPO in three years – The Information
Global cryptocurrency exchange Binance’s founder and chief executive officer Changpeng Zhao said that its U.S. arm could have an initial public offering in the next three years, The Information reported https://bit.ly/3jBIOAT on Wednesday. “Binance.US is just going to do what Coinbase did,” Zhao said, according to the report.
NFTs transform the art market for young novice buyers; Digital tokens offer a way to buy and own shares in instantly recognisable works by bankable, international artists
Helen Barrett – FT
There he stands in the middle of a Mayfair gallery, $90,000-worth of fine, milky marble chiselled into the shape of a male torso: headless, fig-leaved and gloriously visible. His name is Kouros, but he could be a waiter in a West End café or a gym-obsessed banker over in the City of London, because large parts of his shoulders and back are obscured by an enormous, psychedelic tattoo.
Why Bitcoin’s Price Got Stuck at $50,000; Investor interest in other corners of the crypto market—including Ethereum and NFTs—has contributed to the lull
Paul Vigna – WSJ
The late summer lull that overtakes Wall Street is even making bitcoin drowsy. Bitcoin’s price stalled right at $50,000 during its August rally. On Wednesday, the cryptocurrency settled at $48,279.42, before briefly crossing $50,000 on Thursday.
Standard Chartered joins crypto-focused Global Digital Finance alliance
Standard Chartered has become the first bank to join the Global Digital Finance (GDF) Patron Board, an alliance of firms working collaboratively to raise the standards for custody, settlement finality, and brokerage across the crypto and digital assets landscape.
Australia, Malaysia, Singapore and South Africa launch cenbank digital currency scheme
Alun John – Reuters
Central banks in Australia, Singapore, Malaysia and South Africa will conduct a cross border payments trial using different central bank digital currencies (CBDC) to assess if this allows transactions to be settled more cheaply and easily, the banks said on Thursday.
The head of trading for a crypto brokerage firm shares 11 altcoins he’s bullish on — and 3 rules he abides by in the hyper-volatile and fast-moving market
Vicky Ge Huang – Insider
When a friend contacted him about an opportunity to trade bitcoin for a Swiss brokerage, Heusser, a veteran trader with over two decades of experience working for hedge funds and investment banks, did a double take.
NFTs, DeFi Boost for Ethereum Dims Clamor of Bitcoin Maximalists
Vildana Hajric – Bloomberg
Ether has gained 350% this year versus Bitcoin’s 60% advance; August marked Ether’s second monthly rise and best since April
Surging demand for NFTs and DeFi apps is allowing backers of Ethereum to dampen the cacophony of Bitcoin maximalists who have long claimed that only the original cryptocurrency matters. Ether, the native token of the most-used blockchain, jumped 36% in August, more than double the 13% return for holders of the biggest digital asset by market value during the same period. So far this year, Ether is outperforming Bitcoin by the widest margin going back to at least 2018, Bloomberg data show.
U.S. blocking Chinese acquisitions of global tech firms a “red flag” – Chinese state-backed tabloid
Chinese state-backed tabloid the Global Times called U.S. efforts to block cross-border acquisitions of tech companies a “red flag” that impedes China’s tech sector and disrupts the growth of the global tech sector.
U.S. Weighs Quota System in Bid to End EU Steel-Tariff Feud
Eric Martin and Joe Deaux – Bloomberg
Monitoring also may play a role in metals solution, people say; Two sides seek to reach a deal to resolve dispute by year-end
President Joe Biden’s administration is considering a quota system as it prepares a proposal for the European Union to resolve a dispute over steel and aluminum imported from the bloc.
Russia starts to sow seeds of ‘wheat diplomacy’; Food exports bring in welcome dollars to the sanctions-hit economy but could also extend Moscow’s global reach
Nastassia Astrasheuskaya – FT
“Vladimir Putin had just become president,” says a market consultant in Moscow, who asks to remain anonymous. “And he was told in a meeting that Russia imported more than 50 per cent of its food. His face went pale. “Putin has since made it his goal to ensure better food security in the country,” adds the person who attended the meeting in 2000. “He dreads dependency. And now Russia is number one in wheat, and is having others depend on it.”
UK plc should not be above the law; Reform of corporate criminal liability is needed to hold large companies to account
The editorial board – FT
Has UK plc become too big to prosecute? The Serious Fraud Office, tasked with investigating and prosecuting the most complex financial crimes, thinks so. Successive SFO directors have called for reform of corporate criminal liability laws. A bad workman often blames his tools. The SFO has a poor record in court but in this area the apparatus it must work within is antiquated and ineffective. It needs an overhaul if the largest corporations are not to be above the law.
Financial crime fighting has lost its way; It’s time to regenerate the UK’s fight against financial crime, argues RUSI’s Tom Keatinge.
Tom Keatinge – FT
It’s an unfashionable view to take, but I feel sorry for the banks. At this point you’ll be thinking “well of course you do, you worked for them for 20 years”. But before you label me an unrepentant apologist, hear me out.
Powell Gets Unlikely Boost With His Liberal Critics in Disarray
Nancy Cook and Steven T. Dennis -Bloomberg
Progressives haven’t coalesced around another candidate; Ocasio-Cortez, other progressives demand Biden replace Powell
Liberal Democrats are publicly assailing Federal Reserve Chairman Jerome Powell’s record in an effort to persuade President Joe Biden not to give him a second term, but they aren’t yet lining up behind any one alternative to run the central bank.
SEC Charges Global Crypto Lending Platform and Top Executives in $2 Billion Fraud
The Securities and Exchange Commission announced today that it has filed an action against BitConnect, an online crypto lending platform, its founder Satish Kumbhani, and its top U.S. promoter and his affiliated company, alleging that they defrauded retail investors out of $2 billion through a global fraudulent and unregistered offering of investments into a program involving digital assets.
France fines U.S. bank JP Morgan $29.6 million in tax fraud settlement
U.S. bank JP Morgan has agreed to a 25 million euros ($29.6 million) fine in a settlement of a tax fraud case, French financial prosecutors’ office said on Thursday. The financial prosecutors’ office said in a statement a Paris court had approved on Thursday the settlement sealed with JP Morgan. The settlement follows a probe opened in 2012.
SEC Wants Sustainable Funds to Disclose More About Their Criteria
Asset managers who claim their funds are environmentally friendly or socially responsible could have to disclose the criteria and data they used to select the companies, the chief of Securities and Exchange Commission said Wednesday. In a videoconference, Chairman Gary Gensler told members of the European Parliament that the SEC is considering whether to require fund managers to disclose more information about the labeling of their environmental, social and governance, or ESG, investing products.
Would a Payment for Order Flow Ban End the Fun for Robinhood and Meme Stocks? Let’s examine the important implications of a potential end to PFOF.
Kevin Curran – The Street
Earlier this week, SEC Chairman Gary Gensler offered his tacit approval to a ban on a practice that could have big implications, not only new-age trading platforms such as Robinhood, but also for many of these platforms’ most popularly traded stocks. This practice, known as “payment for order flow” has been a boon to broker-dealers and, in many ways, has helped ignite the “meme stocks” that have attracted so much of the market’s collective attention this year. For perspective on this rise in importance, a recent congressional report stated that payment for order flow to firms such as Citadel Securities and Susquehanna International Group resulted in $2.5 billion in revenue for major broker dealers like Charles Schwab, Robinhood, and E*Trade from 2019 to 2020.
Singapore Says Binance May Have Breached Payment Regulation
Chanyaporn Chanjaroen – Bloomberg
MAS is reviewing local Binance unit’s application for license; MAS asks the parent company to stop services regulated locally
Singapore’s financial regulator said Thursday Binance Holdings Ltd. may be in breach of the local payment regulation and asked the world’s largest cryptocurrency exchange to stop offering services regulated in the city state.
SEC Sanctions Brokerages Over Email Break-Ins; The enforcement actions are the latest in a push by regulators to get brokerages and money managers to better protect their clients’ personal information
Dylan Tokar – WSJ
Securities regulators on Monday sanctioned three financial advisory firms over email account break-ins that exposed the personal information of thousands of customers. The enforcement actions are the latest example of the U.S. Securities and Exchange Commission penalizing brokerages and money managers over hacks. The SEC alleged the three firms failed to implement adequate policies to protect customer information and respond to cybersecurity risks.
Check on superannuation trustee preparedness for new IDR requirements finds more work required
A recent ASIC survey of registrable superannuation entities (trustees) about their preparedness for the new enforceable internal dispute resolution (IDR) obligations has identified some important areas requiring further work.
Wirecard-linked British businessman charged in Singapore over fake letter; Henry O’Sullivan allegedly instructed local firm Citadelle Corporate Services to falsify a document
Stefania Palma and Mercedes Ruehl – FT
A British businessman who advised Wirecard in Asia has been arrested and charged in Singapore for allegedly instructing another company linked to the collapsed German payments group to forge a letter.
US financial markets watchdog chief warns cryptocurrency platforms will not survive without oversight
Jack Barnett – City AM
The chief of the US financial markets watchdog has warned that cryptocurrency trading platforms are unlikely to have any future unless they collaborate with regulators.
U.S. SEC opens probe into EV company Workhorse Group -letter
The U.S. Securities and Exchange Commission (SEC) has opened a probe into electric vehicle maker Workhorse Group Inc, an early investor in Lordstown Motors Corp, according to a letter from the regulator published by a short seller.
FINRA Announces Governor Elections and Appointments
FINRA announced today the election or appointment of five industry members to its 22-member Board of Governors. Seven of the 10 industry seats on FINRA’s Board are decided via election, and large, mid-size and small firms decide the Governors who represent their respective firm categories in those seats. At the Annual Meeting of FINRA Firms on Sept. 1, firms elected the following Governors to fill the three open elected seats:
Investing and Trading
Bill Gross Says Bonds Are ‘Investment Garbage’ Amid Low Yields
Ye Xie – Bloomberg
Pimco co-founder says stocks may follow suite if earnings lag; Onetime bond king says 10-year yields could reach 2% in year
Bill Gross is talking trash about the bond market — literally. In a meandering and sometimes off-kilter investment outlook posted on his website, the onetime bond king said longer-term Treasury yields are so low that the funds that buy them belong in the “investment garbage can.”
Tokyo stock market eclipsed by the four tech leviathans; Apple, Alphabet, Facebook and Amazon are now worth more than the entire Topix constituents
Leo Lewis – FT
While much of Japan spent August fretting about the Olympics, the heat and the rampaging Delta variant, some sweated over two lines crossing on a market screen.
Investors, Don’t Max Out on Buy Now-Pay Later; Affirm’s shares skyrocketed on news of an Amazon partnership—and that begs some questions about the direction of installment payments
Telis Demos – WSJ
Buy now-pay later investors were rewarded for their splurge on these stocks when Affirm Holdings AFRM 0.15% struck a deal with e-commerce behemoth Amazon. AMZN 0.24% com. Now it is time to figure out what exactly they own.
Ex-Goldman Trader Builds Unicorn After Being Denied Credit Card
Gearoid Reidy and Min Jeong Lee – Bloomberg
Russell Cummer was a credit trader at Goldman Sachs Group Inc. in Tokyo when he tried and failed to get a credit card. It’s a common tale in Japan, especially for young people with no credit history. Cummer’s response was decidedly uncommon: He ended up forming a business to give people an alternative to cards.
U.S. energy firms strain to shake off hurricane’s toll
Liz Hampton and Sabrina Valle – Reuters
U.S. oil and gas companies strained to get offshore operations back up and running on Thursday as the extent of Hurricane Ida’s damages became more apparent.
Why Fidelity Hiring 9,000 People Is a Warning for Stocks; Wall Street is known for hiring at the top and firing at the bottom.
By Mark Gongloff – Bloomberg
Bad News: People Are Getting Jobs
Wall Street can sometimes be this weird Bizarro World where everything is topsy-turvy and good news is bad news. For example, normal humans like it when other humans get jobs. They tweet “OMG CONGRATS!” and click “like” on LinkedIn. But Wall Street humans don’t like it when other humans get jobs. More jobs means less profit and higher wages and more inflation and less money printer go brrr.
Putting the Meme Stocks in the Index; Also Arm China, private equity recruiting, carbon trading and Robinhood restrictions.
By Matt Levine – Bloomberg
GameStop and the S&P
Every so often a weird stock goes up a lot, and it becomes so valuable that it qualifies for the S&P 500, the main index of U.S. large-cap stocks, and then people write articles that are like “oh no all the index funds are being forced to buy this weird stock at a huge valuation that makes no sense.” This does not bother me very much: The whole point of an index fund is that you buy all the stocks at whatever their market prices are, rather than trying to predict which ones are over- or undervalued. If you index, sometimes you will buy stocks that are overvalued, but, crucially, you will do this less often than most fundamental active investors do. The fundamental active investors, remember, underperform the index in aggregate. So when they go around saying “hahaha the index funds are so dumb for buying this crazy overvalued stock,” they are wrong slightly more often than they are right.
Environmental, Social and Corporate Governance
Air Pollution From Fossil Fuels Could Cut Lifespans by 2 to 5 Years; The same policies that tackle climate change could add years back to our lives, a new analysis finds.
Linda Poon – Bloomberg
From gas-guzzling cars to power generation, fossil fuel combustion is a leading cause of climate change. But that’s not the only reason to rein in emissions. Fossil fuels are also a leading direct source of air pollution, a health risk that can take years off of human lives.
ECB Warns Banks of Climate-Test Risks That Could Hit Capital
Nicholas Comfort, Steven Arons, and Frances Schwartzkopff – Bloomberg
Regulator stepping up pressure on banks over carbon risks; ECB had earlier signaled displeasure at banks’ progress
The European Central Bank is stepping up pressure on lenders to prepare for stress tests next year that will show just how vulnerable the industry is to climate change, according to people familiar with the process.
Venture Capital Firms Are Fighting to Throw Money at Cleantech; Early stage valuations are through the roof, which is a good thing — as long as companies can deliver.
Nathaniel Bullard – Bloomberg
Just last month, a pair of investment funds closed more than $12 billion of private equity funding for climate- or energy transition-related investments. I noted at the time that it was a welcome inflow of capital to an area that hadn’t seen much interest in years … or ever, really. I also wondered a bit where that money might go.
Nigeria Races to Extract Its Oil Before It’s Too Late
William Clowes, Anthony Osae-Brown, and Paul Burkhardt – Bloomberg
Nigeria’s vast reserves of oil and gas have generated great riches but are also blamed for fostering conflict, corruption and poverty. Now the country’s leaders want to almost triple its crude production just as a warming world seeks to accelerate a move away from fossil fuels.
Scotland Seeks Wind Farms to Power North Sea Oil and Gas Fields
Jess Shankleman – Bloomberg
Applications for the leasing round seen opening in early 2022; The U.K. oil, gas industry is struggling to boost investment
The Crown Estate, which owns the U.K. seabed, is inviting offshore wind-farm developers to build new projects that will help power oil and gas fields in the North Sea.
Madagascar is suffering from a climate change famine; Drought has ravaged farms across southern Madagascar, like this cassava plantation
Samanth Subramanian – Quartz Africa
Madagascar is being hit by one of the modern world’s first climate change-induced famines—a disaster that underscores the profound unfairness of a planet heated up by carbon emissions.
The Planet Needs Jerome Powell; The Trump-appointed chair of the Federal Reserve has inadvertently become a climate advocate.
Robinson Meyer – The Atlantic
In recent weeks, the climate movement has become caught in the middle of a fight that seemingly has nothing to do with the environment: Should President Joe Biden renominate Jerome Powell to lead the Federal Reserve?
Deutsche Bank regains Hong Kong IPO sponsor licence
Deutsche Bank has regained its Hong Kong Initial Public Offerings (IPOs) sponsors licence after it was suspended in June following the departure of key staff, according to a notice on the website of the city’s markets watchdog.
MOVES Credit Suisse appoints former Morgan Stanley banker in Mexico
Brenna Hughes Neghaiwi – Reuters
Credit Suisse (CSGN.S) has hired former Morgan Stanley (MS.N) banker Alejandro Ortega Aguayo to lead its advisory team handling its wealthiest clients in Mexico, the Swiss bank said on Thursday.
BNP Paribas in wealth management JV talks with China’s AgBank -sources
BNP Paribas’ (BNPP.PA) asset management arm is in talks to form a wealth management venture with a unit of Agricultural Bank of China (AgBank), sources said, as the French firm pursues a bigger slice of China’s $19 trillion market.
Wells Fargo Pushes Back Its Return to Office by Two More Weeks
Hannah Levitt – Bloomberg
Wells Fargo & Co. pushed back its return-to-office plans by two more weeks to mid-October. The company, which has the most employees of any U.S. bank, will now begin bringing back staffers who have been working remotely starting Oct. 18, rather than Oct. 4, according to an internal memo Wednesday from Chief Operating Officer Scott Powell. Last month, Wells Fargo delayed its office return, originally set for Sept. 7, by a month as Covid-19 cases surged again across the U.S.
Singapore to let blank cheque companies raise funds starting on September 3, beating Hong Kong to the punch with SPACs
Chad Bray – South China Morning Post
Singapore said on Thursday that it would allow special purpose acquisition companies (SPACs) to go public on its bourse starting Friday, as the city state hopes to become the go-to market in Asia for what has been one of the hottest fundraising trends globally in the past 18 months.
Longer Wait for Dividends Sinks South African Insurer’s Stock
Roxanne Henderson – Bloomberg
Discovery says pandemic uncertainty and economic risks remain; China’s Ping An Health to get South African insurer’s funding
Discovery Ltd.’s shares slid the most since the height of the pandemic last year after the South African insurer said it will withhold dividends and contribute additional capital for its investment in China’s Ping An Health Insurance.
How Defaults in China Are Reshaping Its Credit Market: QuickTake
After three record years of bond defaults, Chinese policy makers rushed when the pandemic hit to prevent another wave of missed payments. Now they are taking advantage of a strengthening economy and stable financial markets to take a tougher stance with indebted giants such as China Huarong Asset Management Co. and China Evergrande Group — firms that had been considered “too big to fail.” The result has been a repricing of risk in China’s credit markets that should discourage the kind of debt-fueled expansion that not only threatens the financial system but could also weaken President Xi Jinping’s grip on power.
European executives face increased investor scrutiny over pay – report
Simon Jessop – Reuters
Investors in Europe’s seven biggest markets increased their opposition to executive pay and the re-election of some directors in the most recent season for annual general meetings, consultancy Georgeson said in a report here.
Japan investigating Amazon cloud disruptions to brokers, airline
Japan is investigating an Amazon Web Services (AMZN.O) outage that caused disruptions at major online brokerages, a leading mobile phone carrier and the country’s biggest airline, a government spokesperson said on Thursday.
EXCLUSIVE Apple hit with antitrust case in India over in-app payments issues
By Aditya Kalra – Reuters
Apple Inc (AAPL.O) is facing an antitrust challenge in India for allegedly abusing its dominant position in the apps market by forcing developers to use its proprietary in-app purchase system, according to a source and documents seen by Reuters.
A cautionary tale for cycling converts; A cardiac episode offers lessons in philosophy as well as the need for health checks
Jonathan Derbyshire – FT
A couple of months ago a colleague who knew I’d developed a serious obsession with cycling during the pandemic arranged for an advance copy of a book called The Midlife Cyclist to be sent to me. I was very much its ideal reader — middle-aged and full of what the author Phil Cavell calls the “zealotry of the convert”.