Crypto wrap: Uncertainty for UK CBDCs, FTX to reimburse customers, Ethereum ETF buzz

Digital Pound Foundation event speakers say UK CBDC is not a given, FTX says it will not relaunch exchange.

We caught up on developments locally and internationally.

Digital Pound panel discusses CBDC potential in UK

GRIP attended the Digital Pound Foundation’s event Exploring the Evolution of Digital Money – what’s on the Horizon for 2024?

Digital money expert David Birch made an impassioned speech, saying payments shifts were a “once in a generation event”, but that any agenda on CBDCs should not be “technologists setting the agenda and deciding; it should be civil society.”

The author of The Currency Cold War said the public’s views should be taken into consideration, since a makeshift poll had shown just a 30% public interest in the matter.

He identified six innovation drivers: sovereignty, inclusion, resilience, influence, sustainability, and innovation.

David Birch speaking at CMS.
Photo: Martina Lindberg

FTX announces reimbursements

After buzz around plans for a relaunch, FTX attorney Andy Dietderich told a court in Delaware the failed exchange would not relaunch.

After mooting the idea of a relaunch in November last year, FTX 2.0 reportedly failed to find investors. “FTX was an irresponsible sham created by a convicted felon,” Dietderich said. “The costs and risks of creating a viable exchange from what Mr Bankman-Fried left in a dumpster were simply too high,” Dietderich said.

Dietderich said the exchange could “cautiously predict” fully repaying users and creditors, but added this was “an objective” and not a “guarantee.” But they would be repaid at November 2022 prices, when crypto overall was going through a bear cycle. That was also the month FTX filed for bankruptcy

Standard Chartered Ethereum ETF optimism

A prediction from Standard Chartered Bank says Ethereum ETFs could be approved in the first half of this year, following in the footsteps of bitcoin eTFs.

“This is a political call. We believe there is no upside for SEC Chair Gary Gensler to approve a spot Ethereum ETF given how upset progressive Democrats were over the agency’s approval of a spot bitcoin ETF earlier this month.”

Jaret Seiberg, TD Cowen Research Group

“We expect pending applications for ETH US spot ETFs to be approved on May 23, the final deadline for the first of the ETFs under consideration – the equivalent date to January 10 for BTC ETFs,” said the research team led by Geoffrey Kendrick, head of forex and digital assets research, Standard Chartered Bank. “If ETH prices perform similarly to how BTC prices performed in the lead-up to BTC ETF approval, ETH could trade as high as $4,000 by then.”

But others are less optimistic. TD Cowen Washington Research Group gave late 2024 or early 2025 as a more realistic date.

“We do not expect the SEC in 2024 to approve a spot Ethereum ETF,” a research team led by Jaret Seiberg said this week. “This is a political call. We believe there is no upside for SEC Chair Gary Gensler to approve a spot Ethereum ETF given how upset progressive Democrats were over the agency’s approval of a spot bitcoin ETF earlier this month.”

Thailand introduces crypto-friendly rules

Thailand’s version of the SEC pivoted to more crypto-friendly regulations.

The criteria regarding investing in digital tokens are:

  • supervising the issuance of investment tokens by removing investment restrictions on retail investors for digital tokens that have real estate or real estate income streams as the underlying asset and digital tokens that have an infrastructure business or an infrastructure business revenue stream as the underlying asset; 
  • reviewing the criteria to support the creation of custodial wallet provider businesses and being able to provide services to digital asset business operators that are related in the manner of having major shareholders;
  • digital asset business operators who wish to operate other businesses require permission from the SEC before proceeding;
  • improving service standards by digital asset business operators; raising the quality and increasing the reliability of the overall digital asset market.

The Thai SEC has, however, said it will not approve bitcoin ETFs.

George Osborne joins Coinbase as adviser

Following the trend of businesses hiring British ex-politicians, Coinbase has appointed former UK Chancellor George Osborne as an adviser.

Osborne has taken on various consultancy positions since leaving politics for journalism in 2017.

“There’s a huge amount of exciting innovation in finance right now. Blockchains are transforming financial markets and online transactions. Coinbase is at the frontier of these developments. I look forward to working with the team there as they build a new future in financial services,” Osborne said.

Coinbase CEO Brian Armstrong expressed a positive view of the UK in the past year, particularly in light of what he views as American regulatory hostility towards crypto. He has even discussed considering relocating Coinbase’s headquarters to London.

“The US is squandering an early lead, in part because SBF embarrassed some politicians and regulators who now want to look tough on crypto. Pretty much everyone else has moved on though, and FTX is not really discussed in UK, UAE, etc,” Armstrong said at the Innovate Finance Global Summit in London last year.