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Expert Calls on SEC to Label Ripple’s XRP as Security

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Ripple has so far purchased around $45 million worth of XRP with more assurance from the company executives that they may continue to purchase more to support a healthy market.

XRP, the fourth-largest cryptocurrency by market cap, has been the center of discussion among experts since its emergence. A part of the cryptocurrency community sees Ripple‘s XRP as nothing but a security while others do not treat it as such.

The recent comment on the status of the digital asset comes from Peter Brandt, who declared his stand rubbishing claims that XRP is not a security. This contradicts the view of Chris Giancarlo, former Commodity Future Trading Commission (CFTC) chairman who believes that XRP is not a security. 

On November 10, 2020, a Twitter user expressed his view claiming XRP company owns almost half of the total circulating coins. In response, Brandt stated that the claim is a “classic case of the market being manipulated by a bag-holder.”

The status of XRP has been up for discussion since 2018 with SEC unable to come out with a firm decision on this topic especially after cracking down on several crypto-related projects for selling unregistered securities. There have been reported lawsuits that condemn XRP as an unregistered security. 

Ripple and XRP Activities Opening Way for More ‘Security’ Argument

Ripple, which has been said to be operating independently from XRP owns more than half of the total coins. Out of the 100 billion pre-mined coins, Ripple is said to own 60 billion XRP with 55 billion put in escrow. The Q3 market report published by Ripple speaks volumes with the revelation that the company has been purchasing a lot of the coins. 

Ripple has so far purchased around $45 million worth of XRP with assurance from the company executives that they may continue to purchase more to support a healthy market. To clarify the ongoing misunderstanding concerning the security status of XRP, Giancarlo who happens to be no longer part of the regulatory body provides what may be holding the SEC back from treating it as an unregistered security. 

In a paper entitled “Cryptocurrencies and U.S. Securities Law: Beyond Bitcoin and Ether” published in the International Financial Law Review, Giancarlo and other Co-Author argued that the recently improved adoption of XRP by Business to Business and Consumers as a medium of exchange and payment method underscores its utility as a substitute of fiat.

The paper further argues that the expanding analysis of SEC and Howey test put XRP under the same category as a medium of exchange or currency. In this case, the fair application of these yardsticks do not qualify XRP as a security. 

XRP is currently on the move as it has sealed several partnership agreements with payment platforms and financial institutions. It is not fully decentralized as the other cryptocurrencies but centrally controlled with a percentage of the coins released into circulation annually.

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Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.





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Beeple Presents NFT Platform WENEW to Sell Moments in Time

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Beeple asserted that the NFTs constituted a new prototype that feeds off the remarkable achievements in human history, which can be commemorated and honored through the platform.

Mike Winkelmann aka Beeple, one of the most famous digital artists around the world,  presented WENEW,  the premier curator and provisioner of iconic moments as Non-Fungible Tokens (NFTs). The platform helps people collect stellar instances in sports, arts, and culture on the blockchain.

The platform which aims to ‘immortalize moments on the Blockchain’ has roped in industry giants like TIME, Endeavor, IMG, Universal Music Group, Warner Music Group, The Champions Wimbledon, and Open Earth Foundation. TIME has been delegated as the curation partner, and the work will include assisting WENEW to recognize the awe-inspiring moments in history.

The first auction to take place will commemorate tennis ace Andy Murray’s triumphant feat at Wimbledon in 2013. The home page of WENEW’s website displays an impressive gallery of photos from Andy’s long-awaited victory against Serbian player Novak Djokovic. The bid that commences on July the 2nd will not only sell an NFT but the entire experience, making the auction more riveting. The highest bidder in the deal will be provided VIP benefits like sporting a match with Murray at Wimbledon, along with a couple of tickets to the men’s finals in 2022. The bidder will also enjoy a private behind-the-scenes tour for a wholesome experience.

The Ethereum-run platform will, in addition to blockchain ownership, furnish the collectors with a Physical Artifact of their WENEW moment. With the help of Arweave technology, an IT company specializing in data storage and blockchains, the WENEW moments will be combined with profound editorial works that exhibit an essential history. Some of the ‘premium moments’ will also provide exclusive access to once-in-a-lifetime collectible memorabilia. 

Since Ethereum has been functioning on inflated gas prices (which is the unit that estimates the amount of computational effort required to execute distinct operations), it is not regarded as an eco-friendly blockchain. To uphold the platform’s and Beeple’s claims of supporting sustainable NFTs, WENEW has partnered with Open Earth Foundation which will manifest activities curated to diminish energy-intensive exchanges. The platform also professes to fund enterprises towards a wide-ranging variety of climate programs.

Beeple, the highest-paid NFT artist in the world, asserted that the NFTs constituted a new prototype that feeds off the remarkable achievements in human history, which can be commemorated and honored through the platform. He explained how meaningful memories can shape and inspire people in a way that matters. 

“WENEW exists to facilitate and make concrete these once-abstract connections,” concluded Beeple.

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Chinese Ride-Hailing Firm Didi Targets $60+ Billion Valuation in IPO

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Going by Didi’s updates prospectus, Morgan Stanley Investment Management Inc has shown interest in acquiring a share of up to $750 million in the IPO.

China’s ride-hailing giant Didi Global Inc is expecting that an IPO could value it at over 60 billion. An SEC filing made Thursday shows that the company is going to list its shares on the New York Stock Exchange (NYSE) under the ticker symbol ‘DIDI’.

Didi will offer 288 million American Depository Shares (ADS) or 72 million Class A common stock, valued at $13-$14 each. At the upper end, the company could raise $4.03 billion, making it the biggest US IPO of 2021. It would also be the biggest U.S. share sale done by a Chinese company since 2014.

Moreover, in case of an over-allotment, the company could sell 43.2 million extra shares thereby raising an extra $605M.

Initially, Didi (Xiaoju Kuaizhi Inc.) wanted to list on the Hong Kong Exchanges (HKEX) but turned instead to NYSE. The business sought to mitigate risks for increased regulatory scrutiny in its practices, including using part-time drivers and unlicensed cars.

Already, the State Administration for Market Regulation (SAMR), China’s market regulator, has launched an antitrust probe on Didi. Investigations will determine if Didi has used unfair competitive practices, in addition to transparency in the ride-hailing pricing mechanisms. The probe is the latest, with Alibaba Group (HKG: 9988) and Tencent Holdings Ltd (HKG: 0700) having preceded.

Concerns over more Chinese regulatory crackdown have now cut the company’s IPO valuation by 33%. The drop was also attributed to uncertainty in the company’s growth prospects.

Didi Market Perspective and NYSE IPO

Going by Didi’s updates prospectus, Morgan Stanley Investment Management Inc has shown interest in acquiring a stock of up to $750 million in the IPO. Singapore’s Temasek Holdings Ltd. (SGX: TEKB) would also like to subscribe to $500 million worth of stock. Other giant tech firms in Asia counted as investors are SoftBank Group Corp (TYO: 9984), Alibaba, and Tencent.

Goldman Sachs Group Inc (NYSE: GS), JPMorgan Chase and Co (NYSE: JPM), and Morgan Stanley (NYSE: MS) are the IPO’s lead underwriters. On Thursday, Didi added to this cluster to include Barclays, Citigroup, and BofA Securities, among others.

Founded in 2021, the ride-hailing firm operates in 15 countries internationally, making it one of the top-five private start-ups worldwide. The firm also has over 490 million annual active users globally and it intends to reach 800 million by 2022.

As the company recovered from pandemic-inflicted sales, its Q1 revenue more than doubled year-on-year to reach $6.4 billion. The company also posted a profit for the same period.  Net income was $837 million before shareholder payouts, with a comprehensive net income of $95 million.

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A financial analyst who sees positive income in both directions of the market (bulls & bears). Bitcoin is my crypto safe haven, free from government conspiracies.
Mythology is my mystery!
“You cannot enslave a mind that knows itself. That values itself. That understands itself.”



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Robinhood Delaying Its IPO Plans amid Expansion of Its Crypto Business

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The initial plan of Robinhood was for the IPO to be done in June but the plans stretched to July.

A reliable source has it that In the past, the SEC has been concerned about Robinhood‘s growing business related to cryptocurrencies. While the company may be listed by summer, those plans may as well be achieved later, probably in fall. Robinhood plans to put its house in order and publicize its past financial performances to make way for the public listing. A company’s spokesperson disclosed that a successful Initial Public Offer (IPO) filing was done earlier in the year, March. According to Bloomberg, the initial plan of Robinhood was for the IPO to be done in June but the plans stretched to July.

Robinhood Activities amid Its IPO Plans

Robinhood began trading cryptos two years ago, 2018. Today the company’s portfolio includes Bitcoin, Litecoin, and even meme-based Dogecoin which started as a joke. Besides the mentioned digital coins, clients can get many products on this platform. Robinhood is particularly popular with first time (novice) crypto investors. Robinhood became both popular and controversial during the pandemic and has elected new members to its board. The company is also popular for meme stocks.

The crypto market has been very volatile this year. Bitcoin achieved a high of $64,000 after being backed and endorsed by high-profile investors, notably Elon Musk. However, the rally was short-lived and the prices dipped to as below $30 K in June. Other crypto have been following the same trend increasing uncertainty in the general market.

Sometimes in the near future, Gary Gensler, the current SEC chair, is expected to make momentous rulings on digital assets. Robinhood made the application in a “bad year”. The SEC has been busy, thanks to the many IPOs, particularly for Special Acquisition Companies (SPACs) in their in-tray. These delays have however caused an equity backlog in capital markets. As per Bloomberg’s report, SEC staff has however warned lawyers that this time around, it may take well over a month to review SPAC paperwork. Additionally, they can expect another two to three weeks to get feedback on changes and amendments.

What Ails the Cryptocurrency Market

In the recent past, China has intensified its crackdown on crypto, particularly Bitcoin. Following the Chinese government’s decision to launch a Central Bank Digital Currency (CBDC), the digital Yuan, Bitcoin was no more welcome. In fact, all Bitcoin-focused activities were banned.

Last month, the Chinese government denied rumors suggesting that they wanted to ban Bitcoin mining. However, the same authorities reviewed the same matter, but this time said that they wanted Bitcoin miners out ASAP.

The decision was informed by the thinking that Bitcoin and the digital Yuan would not thrive in a common environment. Government authorities believed that when put in the same ecosystem, Bitcoin would outshine the digital Yuan and possibly hinder its growth.

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Patrick is an accounting & economics graduate, a Cryptocurrency enthusiast, and a Blockchain technology fanatic. When not crafting informative pieces on any of the above subjects, he will be researching on how the Blockchain technology can transform the world, particularly the financial space.



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