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BitMEX, the cryptocurrency exchange and derivatives trading platform co-founded in 2014 by Arthur Hayes, is looking for a buyer, according to two people with knowledge of the plans.
The storied exchange, which arguably made perpetual futures the most popular product among leverage-hungry crypto traders, appointed boutique investment bank Broadhaven Capital Partners late last year to assist with the sales process, the people said. There has been some M&A interest around the crypto derivatives space of late. For instance, major exchanges Kraken and Coinbase are said to be vying for ownership of the leading crypto options exchange Deribit. Meanwhile, FalconX also bought Arbelos Markets earlier this year to expand its derivatives business.
Back in 2020, BitMEX was alleged to have failed to implement adequate anti-money laundering measures in place, and later pled guilty to the charges. Hayes resigned as CEO shortly after the U.S. brought criminal charges, alongside co-founders Ben Delo and Samuel Reed. BitMEX and Broadhaven declined to comment on the acquisition plans. |
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Coinbase has been freed from its protracted legal battle with the U.S. Securities and Exchange Commission as the agency agreed to drop the case that's been among the industry's core fights in federal court.
Though the SEC's intention to agree to shut down the legal dispute had already gone public when the U.S. crypto exchange announced the deal last week, the commissioners had to cast a formal vote to ask a federal judge to throw the switch. The dismissal was done in such a way that the regulator can't change its mind later. "It’s time for the commission to rectify its approach and develop crypto policy in a more transparent manner," SEC Acting Chair Mark Uyeda said in a statement. SEC lawyers already filed a motion to dismiss the case.
Dropping this main case doesn't free the SEC from other Coinbase legal matters, including the company's petition to force the agency to establish crypto rules and Coinbase's pursuit of internal documents in the exchange's ongoing work to reveal the regulator's private deliberations on how to approach digital assets. But this enforcement case was the top legal concern for the U.S. public company, and it sought to elevate the central legal questions of what makes a crypto security and when (and how) a digital assets exchange should register with the agency. Those fundamental questions still await answers that must now be provided by the U.S. Congress.
Once the SEC's previous leadership departed — especially the crypto skeptic chair, Gary Gensler — the temporary chair elevated by President Donald Trump, Mark Uyeda, began overhauling the agency's legal officials and its stance on digital assets. Uyeda named fellow Republican Commissioner Hester Peirce to run the agency's crypto task force, and both of them were vocal critics of the way Gensler approached the industry.
The digital assets sector didn't have to wait for the confirmation of Paul Atkins, Trump's pick to permanently run the agency. Both Uyeda and Peirce served as his counsels when he was a commissioner at the SEC, so they're widely expected to be on a course he'll maintain. So far, that course has seen a wave of abandoned crypto investigations and dropped cases, including against Robinhood, Gemini and ConsenSys's MetaMask, and pauses of matters involving Tron and Binance.
The regulator is no longer maintaining the interpretation of the U.S. Supreme Court's so-called Howey test that it said had indicated many crypto projects qualified as securities.
"Goodbye," Chief Legal Officer Paul Grewal posted on social-media site X after the SEC's announcement on Thursday. "And good riddance." |
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The U.S. Securities and Exchange Commission (SEC) is dropping yet another case against an American crypto company, as the regulator continues its strategic retreat from the so-called “regulation by enforcement” approach to crypto regulation it took under the leadership of former Chairman Gary Gensler. Joe Lubin, CEO of Brooklyn-based crypto software company ConsenSys, said in a Thursday X post that the SEC has agreed to drop its ongoing securities enforcement case against ConsenSys’s MetaMask wallet tool. Like the agency’s decision to drop its case against crypto exchange Coinbase, which was announced last week, the move must first be approved by the agency’s commissioners. “We were committed to fighting this suit until the bitter end but welcome this outcome. No company wants to be the target of agency enforcement, but at the same time, it was our duty and honor to stand up for blockchain software developers in the hour it was most needed, as I’m sure our industry peers who also stood up against regulatory overreach would tell you,” Lubin wrote. The SEC sued ConsenSys over MetaMask last June, alleging that the popular wallet tool was an unregistered securities broker that “engaged in the offer and sale of securities.” The suit came approximately two weeks after the SEC informed ConsenSys that it would close its probe into Ethereum 2.0, which ConsenSys had previously sued the regulator over in April 2024, citing regulatory overreach. The SEC’s decision to drop its enforcement suit against ConsenSys is the latest in a string of dropped cases and investigations into crypto companies, including Gemini, Robinhood Crypto, Uniswap Labs, OpenSea and Coinbase. It's also asked courts to pause ongoing cases against Binance and the Tron Foundation, as well as their affiliated companies and executives. The agency is currently overhauling its approach to crypto regulation under the new leadership of Acting Chair Mark Uyeda, who created a Crypto Task Force – spearheaded by crypto-friendly Commissioner Hester Peirce – just one day after Gensler’s departure. In a statement earlier this month, Peirce laid out the SEC’s roadmap for crypto regulation, and urged companies to be patient as the agency figured out how to “disentangle” itself from ongoing litigation. “We appreciate the SEC’s new leadership and the pro-innovation, pro-investor path they are taking,” Lubin wrote. “We will remain deeply engaged with public and private policymakers going forward. Crypto wants the U.S. to address the best interests of consumers and businesses alike, and we are already on our way to making that happen.” |
Memecoins Aren't Securities |
The U.S. Securities and Exchange Commission (SEC) is officially washing its hands of memecoins. The federal securities regulator said that memecoins — which it defined as a “type of crypto asset inspired by internet memes, characters, current events or trends for which the promoter seeks to attract an enthusiastic online community to purchase the memecoin and engage in its trading” — are more like collectibles than securities, according to a staff statement from the SEC’s corporate finance division published on Thursday. Because memecoins have “limited or no use or functionality,” they do not meet the definition of a security under the Howey Test and are therefore outside the SEC’s jurisdiction. The statement is a formalization of comments made by Commissioner Hester Peirce — the leader of the SEC’s newly-created Crypto Task Force, which has been at the vanguard of the agency’s about-face on crypto regulation since it was formed in January — earlier this month during an interview with Bloomberg TV. In the interview, Peirce said that “many” of the memecoins on the market fall outside the SEC’s jurisdiction. “If people want to buy a token or product that lacks a clear long-term value proposition, they should feel free but should not be surprised some day if the price drops,” Peirce wrote in her roadmap for crypto regulation published earlier this month. “In this country, people generally have a right to make decisions for themselves, but the counterpart to that wonderful American liberty is the equally wonderful American expectation that people must decide for themselves, not look to Mama Government to tell them what to do or not to do, nor to bail them out when they do something that turns out badly.” Such legal interpretations from the securities regulator don't have the weight of formal regulation, but industries overseen by the SEC and other federal regulators tend to follow these kinds of staff statements closely. The infamous Staff Accounting Bulletin No. 121 — guidance known as SAB 121 that was offered by agency accounting staffers — caused turmoil in the crypto sector and the bankers who felt constrained by it until the bulletin was erased by the SEC's current leadership. In this case, a footnote in the staff memecoin statement points out that it's "not a rule, regulation, guidance, or statement" approved by the commission. Though Peirce has made it clear that American investors are responsible for doing their own due diligence on the tokens they buy, the SEC has not ruled out the possibility of stepping in and using its enforcement powers in the case where memecoins are used to evade securities laws. “Notwithstanding the foregoing, this statement does not extend to the offer and sale of meme coins that are inconsistent with the descriptions set forth above, or products that are labeled “meme coins” in an effort to evade the application of the federal securities laws by disguising a product that otherwise would constitute a security,” the staff statement said. “As noted above, the Division will evaluate the economic realities of the particular transaction.” |
The Takeaway: Tokenization's Data |
By Renato Mariotti
For decades, your investment portfolio has revolved around a key academic idea that hasn’t held up very well: efficient markets. There’s a direct line from the efficient markets theory of Eugene Fama in the 1960s to modern portfolio theory. It paved the way for index funds, a strategy that has not only weathered market cycles but also become the default for managing pensions and retirement accounts. As we step into a new era of digital finance, tokenized assets may offer a way to broaden our investment horizons in ways that traditional models have overlooked. Index fund investing didn’t arise by chance. In the early 1970s, amid vigorous debates over market efficiency, Burton Malkiel’s seminal work advocating index funds in 1973 (in his book “A Random Walk Down Wall Street”) was embodied in John Bogle’s launch of the Vanguard S&P 500 fund in 1975. This cemented a strategy that focused on broad diversification and minimal trading. Astonishingly, passive index-investing has triumphed around the world, even though the theory underpinning it, that investors are always rational, hasn’t held up well.
Behavioral psychologists like Daniel Kahneman and Amos Tversky illuminated the flaws in our decision-making processes. This is highlighted in Daniel Kahneman’s award winning book, “Thinking Fast and Slow.”
In the ensuing decades, economists have reconciled efficient markets and irrational behavior into the concept of “pretty good markets.” Aggregated wisdom in the form of prices trends towards being right, over time, though from day to day and case to case there are significant gaps that investors can exploit. Index funds have held up well because exploiting those opportunities is hard to do consistently or cheaply.
At the same time, the regulatory framework governing institutional investing reinforces this reliance on proven strategies. Fund managers operate under strict fiduciary duties that require them to prioritize client interests and mitigate risk. As a result, they allocate the bulk of their portfolios to assets with long, established track records, typically government bonds and passive equity funds.
In short, the criteria for “acceptable” investments aren’t driven solely by potential returns; they are fundamentally tied to data history, reliability, and transparency. In case you were wondering, that means index funds.
In this environment, venturing into uncharted territory is not taken lightly. New asset classes, no matter how promising, are initially sidelined because they lack the long-term, daily data that makes them viable for inclusion in a fiduciary portfolio. Until now, almost all portfolio theory has been based on U.S. equities and government bonds. Although that universe has expanded over time to include index funds and bonds from other large economies, it still represents only a relatively small portion of the world’s assets. Portfolios are constrained at the intersection of regulations and data. And that’s all going to change.
Read the full op-ed here.
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