Also: SEC expects crypto action, Greenpeace drops BTC donations, Iran's mining crackdown |

What you need to know today in crypto and beyond

May 21, 2021

Welcome to The Node.

Next week is Consensus 2021, CoinDesk’s biggest event of the year, featuring panels, workshops, keynote speakers, fireside chats, networking and more, all exploring the evolution of digital finance and blockchain technology. The Node will bring the best of Consensus to your inbox in special morning and evening editions from May 24-27. You can register for Consensus here.

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–Daniel Kuhn

Today's must-reads

Top Shelf

ADVANCE WARNING: The U.S. Department of the Treasury is calling for businesses that receive transfers of more than $10,000 in crypto to report them to the IRS. The policy is said to go into effect in 2023, though it may have contributed to market volatility yesterday.

EXPECT ACTION: SEC chief Gary Gensler said Thursday that federal financial regulators should “be ready to bring cases” against bad actors in crypto, cyber and fintech. While far from descriptive, the statement shows consumer financial protections may become a greater concern under the Biden administration.

CAPITAL ALLOCATION? Coinbase is in talks to acquire Osprey Funds, an asset management firm with a popular closed bitcoin fund and newly launched Polkadot fund. In other institutional product news: ETF provider Teucrium Trading filed an application with the SEC to launch an ETF, benchmarked by bitcoin futures rather than physical BTC. This product could have an edge in getting SEC approval.

GREENING BTC: Greenpeace USA has stopped accepting bitcoin donations, citing its carbon footprint and lack of use. Bitcoin companies are scrambling to deal with the increasingly heated energy debate. BitMEX said today it is committed to becoming carbon neutral – it’ll start buying carbon offsets. Separately, Chinese mining firm BTC.com invested $25 million in a new Texas facility, claiming its energy mix is 85% renewable.

BLOCKCHAIN BLOCKERS: On Tuesday, China issued a warning to institutions not to service crypto-related businesses, a restatement of existing policy that sent ripples through the market. The notice – though familiar – signals a sharpened focus on the financial industry. Separately, the Hong Kong government is moving to license virtual asset service providers and set up "necessary intervention powers" to restrict or prohibit some crypto services. Finally, Iran’s intelligence agency will begin cracking down on illegal crypto miners to reduce strain on the nation’s electricity grid.

–D.K.

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Countdown to #Consensus 2021

First COVID. Then Gamestop. Then Coinbase. The events of the last year have destined bitcoin to play an integral role in our world.

Next week at Consensus by CoinDesk, our virtual big-tent conference, we explore the place of bitcoin as an asset, as a worldview and as a response to the extraordinary policies coming out of our financial, technological and societal institutions.

Join our Explorations track "Bitcoin as a Worldview," sponsored by Stacks, with Cynthia Lummis, Lyn Alden, Dan Held, Meltem Demirors and more at Consensus by CoinDesk, May 24-27. Register today.

Overheard on CoinDesk TV

Sound Bite

“It’s not about the money, it’s about moving the culture forward and giving back to the community.”

–Danny Green of the Philadelphia 76ers, on his NFT story, on CoinDesk TV's "First Mover."

What others are writing...

Off-Chain Signals

Bitcoin Miners Are Giving New Life to Old Fossil-Fuel Power Plants (WSJ)
“Despite the volatility on Wednesday, Hawkins said many retail traders remained interested in trading [bitcoin] ETFs. ‘This is something that people want to trade and own,” he said. “[Bitcoin] is a very, very high risk underlying asset and people have to know that. ETFs are very clear about the risk disclosure.’” (Financial Times)
FTX preparing to raise up to $1 billion at $20 billion valuation (The Block)
British MP Tom Tugendhat is an ETH bull (sees BTC “flippening”) and wants “crypto innovation in the U.K.” (The Block)
Deutsche Bank: "The value of bitcoin is entirely based on wishful thinking" (Yahoo)
Privacy Coin Monero Rises 30% After Biden Reveals Tax Plans for Crypto Transactions (Decrypt)

–D.K.

A message from Saïd Business School, University of Oxford and Esme Learning

Embrace the Fintech Revolution with the Oxford Fintech Programme. Saïd Business School, University of Oxford and Esme Learning are working in partnership to deliver the Oxford Fintech Programme, a six-week, online course accessing critical industry and academic insights. You’ll gain foundational knowledge and explore emergent fintech trends from a global perspective, as part of an immersive cohort through a world-class center of learning, teaching and research. As a CoinDesk subscriber, you can receive a 15% reduction on the program fee when you register to attend.

A message from CoinDesk

Introducing Unlocked 101 at Consensus by CoinDesk 2021

New to crypto? Here's a crash course. Unlocked 101 is a free educational series of sessions designed to give you the tools to navigate crypto. Sessions will be hosted May 4–20 to prepare you for Consensus by CoinDesk 2021, our virtual big-tent event.

Putting the news in perspective

The Takeaway

TFW No More Up Only
Hi, this is Brady Dale. These are bullish days in crypto.

Well, they were. This week's wild sell-offs allow a moment of space to look back on a heady yesterday when many felt the good times would never have a hiccup again.

On May 3, amid the gains, MakerDAO Foundation alum Mariano Conti tweeted out the following challenge:

Challenge accepted.

For younger readers, The Police were a great 1980s band that launched the legend of the great solo act known as Sting. One of the band's classic songs is 1978's "So Lonely." Most of the lyrics of "So Lonely" consist of crooning "so lonely" over and over with various vocal and guitar rejoinders.

But it does have two proper verses. Revised for crypto, those were more than enough to evoke the spirit of these times. It will require other talents than those I was bequeathed, I'm afraid, to turn this into a recorded track.

Until the charts see green again, here's a tune meant to evoke optimistic days:

"Up Only"

Someone told me yesterday
That when you sell your ETH for gains
It's just like saving for a rainy day
Locking in your savvy ways

But I can see the coming flip
DeFi making TradFi trip
And all my artsy NFTs
Disrupting hipster snobbery

Up only
Up only
Up only
Up only

Up only
Up only
Up only

Up only

Up only
Up only

Now Bitcoin's losing dominance
And Vitalik's taking prominence
I've twelve and twenty staked on 2*
For when devs say that 1 is through

Taking gains at 8%
Unless I have slash event
You give your heart, I run my node
It proves my stake will not erode

Up only
Up only
Up only
Up only

Up only
Up only
Up only

Up only

Up only
Up only

Up only (I see it)
Up only (I see it)

Up only (I feel)
Gotta hold, gotta hold

It's gonna go!
Up only
Up only
Up only

Up only
Up only

Only, ETH's only
Up only
Up only
Up only

Up only
Up only

Holding only!
Up only
Up only
Up only

I see it!
Up only

I hold
I hold

I hold hold hold
I hold hold hold

I hold
I hold

I hold hold hold

It's up only
Up only
I'm gonna hold

Hold only
Up only
I only hold
I only hold

Up only (I'm holdin')
Up only (I'm holdin')
Up only (I'm holdin')
Up only (I'm holdin')
Up only (I'm holdin')
Up only (I'm holdin')

* Running an Ethereum 2.0 validator requires a minimum of 32 ETH to run. Ethereum 1.0 used proof-of-work, not proof-of-stake. At first the old chain will run as a part of Ethereum 2.0 but many expect it to someday wind down.

–Brady Dale

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