ConsenSys, the blockchain and web3 software powerhouse behind MetaMask, recently stepped into the spotlight with its response to the SEC’s inquiry on Ethereum’s proof-of-stake (PoS) mechanism. In a robust defense, the firm asserted that concerns around fraud and manipulation are unfounded.

A federal judge in Wyoming has determined that the Federal Reserve is not obligated to grant digital asset bank Custodia access to its master account system. The decision deals a blow to Custodia’s efforts to gain direct access to the Fed’s payment systems and the US money supply, a privilege typically reserved for traditional financial institutions.

Tether, the issuer of the world’s largest stablecoin USDT, has purchased an additional $627 million worth of Bitcoins in the first quarter of 2024. This strategic acquisition has pushed Tether’s total bitcoin holdings to an impressive 75,354 BTC, surpassing the $5 billion mark for the first time.

Today’s Newsletter

MetaMask’s parent company ConsenSys urges SEC to approve Ethereum spot ETF
Custodia Bank loses lawsuit challenging Fed rejection of master account application
Tether added nearly 8.9K bitcoin to holdings in first quarter

Markets

Ticker

24hr

Bitcoin

-1.9%

-0.8%

Ethereum

-3.6%

-2.7%

L1s

3.4%

L2s

-2.8%

1.2%

DeFi

1.5%

3.8%

Fear & Greed Index

Extreme Greed (79)

Greed (75)

Data powered by CoinGecko.

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Top Stories

REGULATION

MetaMask’s parent company ConsenSys urges SEC to approve Ethereum spot ETF

Their argument hinges on Ethereum’s PoS outpacing the security features of Bitcoin’s proof-of-work (PoW), which underpins already SEC-approved Bitcoin-based ETFs. With faster block finality, enhanced attack resistance, and environmental sustainability, Ethereum, as per ConsenSys, sets a new benchmark in blockchain security.

The urgency of this debate is underscored by the looming SEC deadline on May 23 for the approval or denial of spot ETH ETF applications, including those from giants like Fidelity and Grayscale. With Bloomberg analysts pegging the approval odds at 30% for May, the discourse around Ethereum’s security and regulatory acceptance is more relevant than ever. [cryptobriefing]

REGULATION

Custodia Bank loses lawsuit challenging Fed rejection of master account application

Judge Scott Skavdahl of the US District Court in the District of Wyoming rejected Custodia’s claim that it is statutorily entitled to a master account. The court emphasized that Federal Reserve Banks have the discretion to approve or deny master account applications, even if an institution meets the eligibility criteria. This ruling underscores the Fed’s authority to regulate access to its systems and maintain the stability of the US financial system.

Custodia Bank, a Wyoming-based special purpose depository institution, has been embroiled in a legal battle with the Federal Reserve since 2022. The bank’s application for a master account, filed in 2020, was denied in January 2023 after intervention from the Federal Reserve Board of Governors. This case highlights the challenges faced by digital asset banks seeking to integrate with the traditional financial system and the regulatory hurdles they must overcome to gain equal footing with conventional banks. [coindesk]

BITCOIN

Tether added nearly 8.9K bitcoin to holdings in first quarter

Tether’s bitcoin holdings have been steadily growing since September 2022, with the company accumulating BTC every quarter. The latest purchase of 8,888 bitcoins took place throughout the first quarter and was settled at the end of March. This substantial investment has propelled Tether to become the seventh-largest holder of Bitcoin, up from its previous rank of 11 earlier this year.

Tether first disclosed its Bitcoin holdings in May 2023, announcing its plan to purchase BTC with up to 15% of its profits every quarter. This move is part of Tether’s strategy to diversify its stablecoin reserves and reduce its reliance on US government debt. Tether’s growing Bitcoin holdings and its involvement in the Bitcoin mining and energy production space demonstrate the company’s confidence in the long-term potential of the digital asset. [coindesk]