Coinbase wants clarity 🔍

"Attitude is a little thing that makes a big difference."

— Winston Churchill

👋 Friends, Rallie here. The newsletter that feels like a proud parent when you school all your friends on crypto and finance.

On the menu:

• 💣 Coinbase vs. SEC

• 🗞️ Headlines that hit

• 📈 Refresh: Stablecoins

• 💯 Top tweets

The Rallie Recap

🔍 Coinbase just wants clarity, is that so much to ask?

• This week, Coinbase took legal action against the US Securities and Exchange Commission (SEC), asking a federal judge to force the regulator to share its answer on the company's July 2022 petition on whether existing securities laws could be extended to the crypto industry.

• In the petition, Coinbase asked that the SEC “propose and adopt rules to govern the regulation of securities that are offered and traded via digitally native methods” referring to digital assets like cryptocurrencies.

• As it stands right now, there's a big lack of clarity in how cryptocurrency should be regulated in the U.S., and it's causing a lot of headaches for industry players.

• The SEC never publicly responded to Coinbase’s petition, but instead began aggressively ramping up enforcement actions and warnings against crypto exchanges, including Coinbase.

• And the company has some things to say... in a blog posted today, Coinbase Chief Legal Officer, Paul Grewal, wrote, “From the SEC’s public statements and enforcement activity in the crypto industry, it seems like the SEC has already made up its mind to deny our petition. But they haven’t told the public yet. So the action Coinbase filed today simply asks the court to ask the SEC to share its decision.”

• Much of Coinbase’s argument is led by the idea that cryptocurrencies listed on the exchange are not securities – a major contrast to claims by SEC Chair Gary Gensler, who has repeatedly stated that he thinks the majority of digital assets do meet the standards of a security under federal law.

• Earlier this month, Coinbase CEO, Brian Armstrong, said the company would possibly leave the US if crypto regulation isn't made more clear.

Headlines That Hit

• 📸 Snap, crackle, pop. Snap shares dropped as much as 20% after hours today as the company reported first-quarter results that missed revenue expectations.

• 🇨🇳 All eyes on China. The yuan became the most widely-used currency for cross-border transactions in China in March, overtaking the dollar for the first time in history.

• 🚩 And this is why we don't take financial advice from influencers. Last year, Logan Paul spent $623K USD on an NFT. Today, it’s worth essentially nothing.

• 🛟 No lifeguard on duty. This week, First Republic Bank’s market value plunged below $1bn USD for the first time ever after, a report said the U.S. gov won't come to the rescue.

Rallie Refresh: Stablecoins

Heard of stablecoins, but still unsure what they actually are? Well it's your lucky day because we're breaking it down! Let's dive in:

• Stablecoins are digital currencies that are designed to keep their value stable.

• They are usually pegged to a real-world asset, like the US dollar or gold, to maintain their stability.

• Stablecoins are global, borderless, and operate 24/7, making them a convenient and accessible choice for users around the world.

• One of the most popular types of stablecoins is USDT (Tether), which is pegged to the US dollar and widely used in cryptocurrency trading.

• Stablecoins offer a level of transparency and accountability that traditional fiat currencies often lack, as their blockchain-based nature allows for easy auditing and tracking.

• They also have a powerful use case for for remittances, offering a fast and affordable way to send money across borders without the hassle and fees of traditional banking.

• Stablecoins have become increasingly popular in countries with unstable currencies, offering a reliable alternative to hyperinflation and other economic issues.

📈 The more you know!

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That's all for today. Stay hungry & we'll catch you next time. ✌️

DISCLAIMER: This is not financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions.