Here is our outline for our newsletter today🔥

• Ex-FTX Compliance Officer Sued for Allegedly Paying Off Would-Be Whistleblowers🌬

• It’s A 'Forgone Conclusion' That Ethereum Is A Commodity🙅‍♂️

• Ark Amends SEC Filing to Match BlackRock✍

Ex-FTX Compliance Officer Sued for Allegedly Paying Off Would-Be Whistleblowers🌬

FTX's lawyers have filed a lawsuit against Daniel Friedberg, the company's former compliance officer, accusing him of allowing executives' criminal activities to go unnoticed for years and allegedly paying off potential whistleblowers.

The complaint, filed earlier this week, alleges that Friedberg acted as a "fixer," providing "exorbitant hush money" to individuals who threatened to expose FTX's alleged misappropriation of user funds.

The lawsuit lists multiple charges against Friedberg, including legal malpractice, breach of fiduciary duty, corporate waste, and fraudulent transfers.

According to FTX's lawyers, Friedberg had a responsibility to prioritize the interests of Alameda and FTX above his own and those of other FTX insiders who were allegedly siphoning funds.

They claim that Friedberg breached this duty by facilitating the unauthorized diversion of billions of dollars for his own benefit and the benefit of FTX insiders, including Sam Bankman-Fried.

Friedberg served as both the chief compliance officer for FTX's U.S. arm and general counsel for Alameda Research from 2017 until the downfall of both companies in November 2022. The exact amount of money paid by FTX executives to keep potential whistleblowers silent has been redacted from the complaint.

FTX's legal team seeks to recover the payments made to Friedberg, along with interest on his salary, signing bonus, and equity stake. Additionally, they have requested the return of 102 million Serum tokens, valued at over $12 million, which were granted to Friedberg during his tenure.

I wonder whether they are making Daniel take the fall for SBF in order to reduce his sentence. It could be a move from the company’s lawyers 🤔

It’s A 'Forgone Conclusion' That Ethereum Is A Commodity🙅‍♂️

In a recent interview with CNBC, Ethereum co-founder Joe Lubin expressed his confidence in the classification of Ethereum as a commodity, despite the hesitancy of SEC Chairman Gary Gensler to publicly admit it.

Lubin, the ConsenSys Founder, highlighted the regulatory verdict on Ethereum, pointing to former SEC commissioner Bill Hinman's 2018 speech on crypto securities and Ethereum.

Lubin mentioned that the SEC had already spoken on the matter, referring to Hinman's speech. However, new documents have revealed that Hinman received warnings from colleagues that his speech could create confusion in the markets by implying that the SEC had already deemed Ethereum a non-security.

Lubin also highlighted the stance of the Commodities and Futures Trading Commission (CFTC), stating that they have categorically declared Ether as a commodity.

While CFTC Chairman Rostin Benham believes that many cryptocurrencies are securities, he also believes that Bitcoin, Ethereum, and Tether should fall under the jurisdiction of his agency as commodities.

On the other hand, SEC Chairman Gary Gensler has been relatively silent about his position on Ether. Some videos from Gensler's time as an MIT professor indicate that he once considered Ethereum a security, while others suggest that he believed it had transitioned into a commodity by 2018.

To address the uncertainty surrounding Ether's classification, members of Congress, including Cynthia Lummis and Kirsten Gillibrand, are working on legislation to provide clarity.

They have voiced agreement with the CFTC's perspective that Ether is a commodity, aligning it with Bitcoin. Lubin believes it is a forgone conclusion that Ether is indeed a commodity, although there may be a few regulators in the United States who are hesitant to acknowledge this fact.

It is confusing right? How the regulators in the US can’t decide on what crypto falls under what category 😂

More clarity is needed in this sector going forward.

Ark Amends SEC Filing to Match BlackRock✍

ARK Invest has made a significant amendment to its SEC filing.

The company has added a surveillance-sharing agreement (SSA) to its proposal, a move that aims to address potential market manipulation concerns. This change comes shortly after BlackRock filed its own spot Bitcoin ETF application, which already included such an agreement.

What exactly is a surveillance-sharing agreement?

It refers to the sharing of information with regulators to prevent potential market manipulation. This includes details about market trading activity, clearing activity, and customer identification. The inclusion of an SSA is seen as crucial by the SEC, as it ensures that the applicants can adequately protect investors against manipulative practices.

Previous Bitcoin ETF applications that were rejected or still pending did not feature SSAs. However, BlackRock's inclusion of an SSA in its recent ETF filing caught the attention of many.

As a $9 trillion asset manager, BlackRock's application has garnered significant buzz and speculation surrounds the industry's perception of it, given its size and the presence of a surveillance-sharing agreement.

It's worth noting that ARK Invest's previous attempt to launch a spot Bitcoin ETF was rejected by the U.S. Securities and Exchange Commission (SEC). The regulators cited the company's failure to demonstrate how it could prevent market manipulation by cryptocurrency traders.

With the amendment to its SEC filing, ARK aims to address those concerns and potentially gain an edge in the Bitcoin ETF race.

In related news, the SEC recently approved the first leveraged Bitcoin futures ETF, BITX. The exchange-traded fund made a successful debut, recording $5.5 million in trades on its first day.

I think this is very bullish for the overall crypto market📈 Let’s be careful and invest with caution in this market🔥

✨Bonus News✨

Disclaimer: This is not any kind of financial advise. This newsletter is solely informational; it does not constitute investment advice, a solicitation to buy or sell any securities, or a recommendation regarding how to manage your money. Be cautious and conduct your own study, please.