Some key dates to be aware of related to Bitfinex (iFinex), Tether and the NYAG (The NYAG has until July 8 to file a response and the judge scheduled a hearing on the motion to dismiss for July 29)
On May 21, 2019 — Bitfinex filed a motion to dismiss the proceeding brought by the NYAG on the grounds that Bitfinex/Tether do not do business in NY, the Martin Act does not apply to its business and the Martin Act cannot be used to compel a foreign corporation to produce documents stored overseas. Bitfinex and Tether also sought an immediate stay of the NYAG’s document demands.
On May 22, 2019 — Judge Joel M. Cohen of the New York Supreme Court granted Bitfinex’s motion for an immediate stay of the document demands. He issued an order requiring the companies to produce only documents relevant to the limited issue of whether there is personal jurisdiction over the companies in New York but staying the document order in all other respects. The NYAG has until July 8 to file a response. And the judge scheduled a hearing on the motion to dismiss for July 29.
Looking at the crypto market, Bitcoin CME futures expire today and, as pointed out in previous reports, the Commitment of Traders (COT) report shows that large speculators are overwhelmingly net short. A combination of this together with the uncertainty surrounding Tether may result in a further unwinding of long positions. At the same time, the use of MakerDAO’s “lock” function, which allows Collateralized Debt Positions (CDP) holders to add more collateral, remains elevated, having reached its 3-month high over the last 2 days. As a guide, holders can only add pooled ETH (PETH) to a CDP as collateral. Generally, you do this when you open a CDP or when the ETH price drops and you are below your personal collateral threshold or your CDP is approaching liquidation. This also points to market fatigue and potential short-term correction.
Elsewhere, San Francisco-based incubator for the blockchain Ethereum Classic (ETC), ETC Labs, has announced that it has partnered with cryptocurrency firm Metronome to create a solution for Ethereum (ETH)/ETC interoperability.
In terms of news flow, Cointelegraph has reported that Ireland-based cryptocurrency exchange Bitsane has apparently vanished, taking as many as 246,000 users’ crypto deposits with it. Launched in 2016, Dublin-registered Bitsane LP was formerly listed as one of Ripple’s approved exchanges — a January 2018 CNBC article had also pitched the exchange as an option for investors seeking to trade XRP ahead of its listing on major platforms such as Coinbase.
Finally, as reported by Reuters, real-time payments have been possible in the 19-country currency bloc since 2017, but only about half of the euro zone’s banks have joined the scheme that underpins these transactions and it is mostly used for domestic payments. The project could now accelerate as banks feel the heat of new competitors like Facebook, which last week unveiled plans for a cryptocurrency that would offer seamless payments to its users worldwide.
Thank you for reading,
The BeQuant’s Analytics team