Kategorie: Ethereum News

Ethereum news about the ETH blockchain and its crypto ecosystem.

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New York State Attorney General files a lawsuit KuCoin

  • The NY state AG was able to buy and sell crypto on KuCoin.
  • KuCoin is however not registered in New York.
  • This is the AG’s eighth lawsuit against shadowy cryptocurrency platforms.

Letitia James, the New York state Attorney General, has announced that she has filed a lawsuit against KuCoin for issuing crypto services in New York without registration.

James says that she was able to buy and sell cryptocurrencies on the Seychelles-based cryptocurrency exchange despite the fact that it has not been registered in New York as a securities broker or dealer.

Violating securities law

In the suit filed on March 9 at the Supreme Court of the State of New York County, James also alleges that KuCoin violated securities law by selling and offering to sell and purchase and purchasing cryptocurrencies that are securities and commodities to New Yorkers without first seeking registration.

In addition, the lawsuit also alleges that KuCoin error by selling its KuCoin Earn product. The AG has labelled this product as a security that has not been registered.

There are also allegations that KuCoin misrepresented itself since it hasn’t registered itself as one to be allowed to function as one.

James cites Ethereum as security in the lawsuit

The New York AG’s suit also states that under the state and federal authority, LUNA, UST and ETH are categorized as commodities under the state’s Martin Act and that KuCoin filed to register as a commodities broker.

It is the first time the AG has referred to Ethereum’s Ether (ETH) as a security although there have been similar allegations by people in other regulatory authorities in the US.

KuCoin’s native token KCS drops 5.7%

The price of KCS, the native token of KuCoin, has plunged 5.78% partly buoyed by the recent developments.

KuCoin is ranked the fifth largest cryptocurrency exchange if found guilty could be liable to a fine as was the case with Kraken, one of the leading US-based cryptocurrency exchanges, which was fined by the Commodity Futures Trading Commission (CFTC) for offering unregulated crypto investment products.

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​​Stablecoins and Ether are going to be commodities, says CFTC Chair

Key takeaways

  • CFTC chair Rostin Behnam believes that stablecoins and Ether are going to be commodities.

  • The CFTC has always maintained that Bitcoin, Ether, and other cryptocurrencies are commodities.

  • Behnam has called for a proper regulatory framework to cover the cryptocurrency market.

Stablecoins and Ether will be regarded as commodities

Rostin Behnam, the chairman of the Commodity Futures Trading Commission, told the United States senate that Ether and stablecoins should be regarded as commodities.

He made this statement during a Senate Agricultural hearing on Wednesday, March 8th. When asked by Senator Kirsten Gillibrand about the differing views held by the CFTC and the Securities and Exchange Commission (SEC) following the CFTC’s 2021 settlement with stablecoin issuer Tether, Behnam said the agency considers stablecoins to be commodities. He said;

“Notwithstanding a regulatory framework around stablecoins, they’re going to be commodities in my view. It was clear to our enforcement team and the commission that Tether, a stablecoin, was a commodity.”

The CFTC had maintained that some digital assets, including Bitcoin and Ether, are commodities. 

When asked what evidence the agency would use to win regulatory influence over Ether during the Senate hearing, the CFTC chair said it wouldn’t allow Ether futures products to be listed on CFTC exchanges if it didn’t believe that it was a commodity asset. He added that;

“We have litigation risk, we have agency credibility risk if we do something like that without serious legal defenses to support our argument that [the] asset is a commodity.”

A regulatory framework for crypto is still needed in the United States

Regulating cryptocurrency companies in the United States have been left to the SEC and CFTC. However, there is no clear regulatory framework for cryptocurrency companies to operate in the United States.

The SEC has been very active in regulating cryptocurrency companies for what it believes are violations of securities laws.

Last month, the SEC charged Nishad Singh, a former lead engineer at cryptocurrency exchange FTX for defrauding investors of the now-collapsed crypto trading platform.

The regulatory agency is also investigating Robinhood over its cryptocurrency activities.

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Ethereum price forms bearish flag ahead of a pivotal week

  • Ethereum price has formed a bearish flag pattern on the four-hour chart.

  • The next key catalysts will be the Fed statement, NFP data, and consumer inflation numbers.

  • ETH could crash to the next support level at $1,500.

Ethereum price remained in a consolidation phase in the past few days as investors brace for its defining moment. ETH was trading at $1,566, where it has been in the past few days. This price is significantly lower than the year-to-date high of $1,747. 

Key market events

The next two weeks will be important for the future of cryptocurrencies and other financial assets like stocks and bonds. That’s because of the key events that will happen from a macro perspective. On Tuesday, Jerome Powell, the Federal Reserve chair will testify before congress, where he is expected to make a case for more rate hikes in a bid to calm the elevated inflation.

The other important data will come out on Friday, when the US will publish the latest non-farm payrolls (NFP) data. Economists expect the data to show that economy added more than 200k jobs in February. This report will be an important one considering that the previous on caught many investors by surprise as the economy added over 500k jobs.

Therefore, a strong jobs report means that the Fed has room for more interest rate hikes. It will signal that employers are still adding jobs, which is doing good thing for the economy. 

The other catalyst for Ethereum prices will be next week’s consumer price index (CPI) data scheduled for next week. Economists expect the data to show that consumer prices remained at an elevated level, even as they pulled back below 6%.

Take together, these numbers will signal what the Fed needs to do going forward. Signs of more tightening will mean that the recent ETH price rally has faded and that it could move to retest its lowest points in 2022. 

ETH price will also react to the upcoming Shanghai upgrade and the ongoing collapse of Silvergate Capital. Silvergate is a company that provides banking solutions for mostly crypto companies like FTX.

Ethereum price prediction

The 4H chart is not looking good for ETH prices. For one, the coin has formed a bearish flag pattern, which is usually a bearish sign. It has collapsed below the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved sideways. Before that, Ethereum has found a strong resistance level at about $1,700.

Therefore, my view is that Ethereum will likely continue falling as sellers target the key support at $1,500 followed by $1,436. 

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Lido Finance triggers “staking rate limit” after 150K+ ETH gets staked in a day

  • The highly anticipated Ethereum Shanghai upgrade is only days away now.
  • The Shanghai upgrade is causing a lot of activity on Lido finance.
  • The “staking rate limit” was activated after the daily staking limit of 150,000 Ether was reached.

As reported in our earlier news, the Lido Finance protocol is witnessing a surge in activity amid the upcoming Ethereum Shanghai/Capella upgrade. The rise in activity mainly attributed to increasing ETH staking has consequently caused the price of Lido Dao (LDO), the native token of Lido Finance, to hike considerably over the past few days.

At press time, LDO was trading at around $3.09, up 4.09% in the past 24 hours.

“Staking Rate Limit” activation

Lido Finance had to activate its “Staking Rate Limit” safety feature after over 150,000 ETH tokens were staked in a single day on February 25. According to a tweet by Lido:

“Lido protocol has registered its largest daily stake inflow so far with over 150,000 ETH staked.  Upon reaching this number, a curious (but important) protocol safety feature called Staking Rate Limit was activated.”

Lookonchain, a keen on-chain analyst, shared a screenshot that showed that the 150,100 ETH could have been made by a single user, with three deposits of 50,000 ETH each, and one of 100 ETH.

As a liquid staking protocol, Lido Finance allows users to stake Ether (ETH) without needing to lock their tokens, as with most crypto staking platforms. When a user deposits ETH on Lido, he/she is issued with a liquid variant of the deposited ETH, called staked ETH (stETH). The stETH entitled the users to daily staking rewards.

How the rate limit will work

In a guide, Lido Finance stated that the “Staking Rate Limit” acts as a “safety valve” and it aims at limiting the amount of stETH that can be minted during high inflow times so as to mitigate ill side effects like rewards dilution.

In the guide, Liod states that the “Staking Rate Limit”:

“Works by decreasing how much total stETH can be minted at any one time based on recent deposits, and then replenishing this capacity on a block-by-block basis.”

The replenishing capacity is capped at the rate of 6,200 Ethereum ETH per hour.

More than $9.162 billion ETH has been staked with Lido Finance as of February 27, according to the protocol’s website. The amount of staked ETH on the protocol has increased by almost $4 billion since the beginning of the year.

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Lido Dao price up 13% as staking flows rise ahead of Shanghai

  • Lido Dao (LDO) price was up more than 13% in the past 24 hours on Sunday at 3:30 pm ET.
  • LDO is gaining momentum after recovering from lows of $2.72 amid improved sentiment around the upcoming Ethereum upgrade Shanghai.
  • LDO could see a strong move upward amid gains for liquid staking solutions.

Lido Dao price has increased by 13% in the past 24 hours to recover losses recently suffered following negative market reaction to hotter-than-expected US Personal Consumption Expenditures (PCE) index.

But after cryptocurrencies more than held at major support levels following the dump on news of the Fed’s preferred inflation tool, Lidao Dao native token LDO is taking the lead among liquid staking tokens.

LDO price jumps to 6-month high amid LSD positivity

On Sunday afternoon, the Lido Dao token rose to $3.16 from 24-hour lows of $2.72, its highest price since August 2022.

The token enjoyed the gains as Bitcoin recovered above $23k amid fresh strengthening at this the key support level. But Lido’s double digit gains were the biggest amongst the top 30 cryptocurrencies by market cap.

Even as the rates environment remains a sticking point for bulls across equities and crypto, LDO and other Liquid Staking Derivatives (LSDs) are likely to ride a major upcoming crypto event. This is because the highly anticipated Ethereum Shanghai upgrade is only days away now.

Also likely to help LDO is the US Securities and Exchanges Commission (SEC)’s recent crackdown on centralised staking services. While regulatory uncertainty remains a big issue for all of crypto, moves against CeFi players could also nonetheless prove beneficial to decentralised staking solutions. Lido Finance knows this.

Indeed, Lido just saw its largest daily inflow of staked Ether (ETH), according to on-chain details shared by Web3-focused research group Cryptomium.

Pseudonymous crypto trader and analyst Pentoshi says that LDO is likely to have a strong move as LSDs pick up momentum going into the upgrade.

With prices above $3 now, sustained upside momentum could see bulls target $4.00 and then $5.00 in March as Ethereum holders begin to access withdrawals of the staked ETH.

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