Intro/Disclaimer: Since late 2022, I’ve prepared weekly updates for attorneys at my firm to stay abreast of the latest Web3 legal developments. The biggest stories are included in Bi-Weekly posts on the firm’s BitBlog, where we provide concise tl;dr overviews and insights into how these developments might ripple through the industry. In pursuit of a more thorough and personal discourse, I also share expanded versions of these updates on my personal blog every Tuesday. Here, you’ll find my unvarnished perspectives, offering a deeper dive into the nuances of these legal narratives. Please note, the views and opinions I express, both on BitBlog and my personal blog, are solely my own. They do not reflect the official stance or endorsement of my firm.
It was a relatively quiet week last week, as many in the space were at or focused on the largest Bitcoin conference of the year, taking place in Nashville this past weekend. The big news from the conference was former President Trump’s speech, promising to support the industry in the U.S. and have the Department of Treasury form a Bitcoin strategic reserve similar to the U.S.’s strategic gold reserve. Something Presidential candidate RFK, Jr. also hit on. But there were some updates in crypto election funding and a huge blow to Senator Warren’s crypto-killing bill last week.
Here’s everything that happened last week in Web3 legal:
Coinbase Moves to Compel SEC Production of Documents
Coinbase has filed a Motion to Compel the SEC to produce certain documents in the agency’s case against the exchange. This comes after oral arguments on a related issue occurred, with the judge warning Coinbase against overreaching in its document requests. Coinbase is looking to compel the production of, among other things, (1) documents related to SEC meetings with Coinbase and others prior to the litigation; (2) documents related to tokens named in dispute/staking functionalities at issue; and (3) documents related to speeches Chair Gensler gave on digital assets in his personal capacity.
Tl;dr: This is seemingly a part of a two-part strategy by Coinbase which also has requested documents through a FOIA action in a separate court. The Hinman speech documents saw the light of day thanks to the Ripple litigation, and one can expect more documents which are unfavorable to the agency will be eventually forced to be disclosed in this action. With Chair Gensler expected to resign after Biden leaves office, would be a real shame to see his lasting legacy tarnished by emails revealing truth about his political vendetta against the digital asset industry. Reallllllll shame.
Other Stories
The Digital Chamber and others are urging Kamala to use the hot swap of candidates as an opportunity to walk back what was increasingly becoming a partisan issue under Biden as to regulation of digital assets. Technology shouldn’t be partisan. Makes no sense.
I really enjoyed this thread from Austin on why somebody who thinks the financial and online information distribution system largely works should support crypto.
Things you love to see: Hamilton Lane launching a fund tradable on the SOL blockchain. It just makes sense for investment vehicles to be traded in a blockchain authenticated manner to limit risks and costs. Now, let’s see them on a blockchain that doesn’t go down once a month.
The SEC has filed a Motion to Dismiss the currently pending lawsuit filed by MetaMask digital wallet developer, Consensys Software Inc., regarding the status of Ether under federal securities laws and the digital wallet’s software functionalities related to swapping and staking of digital assets. This jurisdictional battle was bound to happen between the pending action in Texas with the subsequently filed SEC action against the developer now pending in New York. I think the SEC probably has the better argument here, but can never count out the Northern District of Texas to go rouge.
Around 20% of Americans own crypto and of those owners, 73% said in a recent poll that they would consider a candidate’s crypto positions in voting determinations.
Fairshake, the pro-crypto super PAC, is now the biggest PAC of this election cycle with $200 million raised. If you think politicians are not paying attention to that, you don’t know politics.
Spot Ether ETFs generated over $1 billion in trading volume on the first day. Which seems good? Is that good? I think that’s good. Now let the products stake so it’s efficient to hold through those products.
Prediction markets are continuing to have a moment in the summer Olympics and lead up to the Presidential election. It’s a nice little trojan horse to crypto adoption, since most news reporting on them doesn’t mention or realize they are powered through digital assets.
Senator Marshall has withdrawn his co-sponsorship of the Senator Warren crypto-killing bill which is advertised as an “AML/KYC” compliance bill but is really designed to kill self-custody of digital asset in America. Love to see it, especially as Senator Warren continues to spread misinformation tropes about environmental or energy risks of crypto mining (ask anybody in energy sector, and they will tell you crypto mining and AI compute is keeping renewable energy production alive in the U.S.).
Meanwhile, Senator Lummis has proposed a bill for the U.S. to form a Bitcoin strategic reserve. Something Trump also hit on during his Bitcoin Nashville talk along with promises to revamp the SEC. Looks like the Senate is finally catching up to the House on crypto support.
Conclusion
If you have any questions or would like me to write about anything else, let me know on Twitter (X?) or Warpcast. As always, I am an attorney, I am not your attorney. For legal advice, you should always consult (and pay for) an attorney.
The NFTtorney 