🐻 Crypto is under attack. What's next?
The truth behind the failing market and economy
GM builders 👋. What a crazy week it's been so far…the SEC is suing Binance and Coinbase, Apple is the new king of AR/VR and aliens are real. Is it me, or does it feel like we are living in a Black Mirror episode?
With heavy uncertainty in the market, I’m curious to know, how many of you are still here and bullish on crypto? Are you sticking it out and building through the bear market or are you losing some hope?
📣The big story. Crypto is under attack. Where do we go from here?
🐻Other news to bear in mind. The SEC wants to freeze Binance US assets, DOGE investors are attempting to sue Elon Musk (again) for insider trading and Robert F. Kennedy Jr. continues to be a popular Presidential candidate in the crypto community.
🐾Resources to paw into. A free speech app and shopping app that lets you earn Bitcoin too.
📣The big story
Crypto is under attack. Where do we go from here?
On Monday, the SEC dropped yet another huge bomb on the crypto industry. Binance, the world’s largest crypto exchange and their CEO Changpeng Zhao (CZ) have been charged with 13 criminal offences.
Today we charged Binance Holdings Ltd. (Binance); U.S.-based affiliate, BAM Trading Services Inc., which, together with Binance, operates ; and their founder, Changpeng Zhao, with a variety of securities law violations.
— U.S. Securities and Exchange Commission (@SECGov)
Jun 5, 2023
The 136-page document makes several accusations against the platform and CZ, including:
Selling unregistered securities (i.e. SOL, ADA, MATIC, SAND, etc.),
Failing to restrict US users from accessing Binance.com via VPN,
Improper management and commingling of customer funds, and the list goes on.
If these allegations are true, this would completely wipe out CZ’s ‘good guy’ image that he took over from SBF after the FTX scandal. But here’s the thing, the SEC isn’t just targeting CZ, they’re going after the entire crypto industry.
Just a day after the Binance charges, the SEC moved forward to place charges against Coinbase for also breaking US securities laws.
Today we charged Coinbase, Inc. with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency and for failing to register the offer and sale of its crypto asset staking-as-a-service program.
— U.S. Securities and Exchange Commission (@SECGov)
Jun 6, 2023
The SEC and Coinbase have been in an ongoing battle for the past few months, so this was less of a surprise. But still, things are not adding up…why is the government so adamant on destroying the crypto industry while bailing out their failing financial system?
The stages of mass destruction
Let’s take a step back and look at the bigger picture.
Stage 1: Fear, uncertainty and doubt
It all started last year when FTX came crumbling down and wiped out $16 billion from the market. The scandal revealed just how friendly FTX CEO, Sam Bankman-Fried (SBF) was with political influencers and his particularly cozy relationship with the SEC’s Chairman, Gary Gensler.
.@GaryGensler and the SEC had more meetings with SBF and FTX/IEX than anyone else in crypto, allegedly to craft a special regulatory framework designed to benefit FTX alone.
Making backroom regulatory deals with bad actors is not a tool in the SEC’s toolbox.
— Tom Emmer (@GOPMajorityWhip)
Dec 22, 2022
If the regulators actually cared about protecting investors they would have stopped FTX early on. But it never happened despite having regular meetings with SBF, the biggest crypto scammer of all.
Now, I’m not saying that the government had a hand in collapsing FTX…but it certainly played in their favor 🤷. When FTX was exposed as a scam and went bankrupt, fear and uncertainty plagued the crypto industry. Investors were exiting their positions and going back to the trusted financial system for safety.
Stage 2: Destruction
But the “real banks” and “real money” turned out to be a risky bet as well. In the past months, several crypto and retail banks followed the same fate as FTX and went bankrupt—Silvergate Bank, Signature Bank, Silicon Valley Bank, and First Republic Bank just to name a few.
The FED simultaneously bails out the banking sector while the SEC declares war on the solution: Crypto
All while FTX 2.0 prepares for launch
SOMETHING DOESN'T ADD UP twitter.com/i/web/status/1…
— Mario Nawfal (@MarioNawfal)
Jun 6, 2023
At the same time, the weakening US dollar has been imminent with the continuous printing of money and the growing strength of the BRICs nation.
A meeting of foreign ministers from the BRICS countries started today in South Africa.
Foreign ministers from at least 15 other countries from the Global South were invited to a second BRICS meeting tomorrow.
Expansion and a new common currency are coming…
— Gold Telegraph ⚡ (@GoldTelegraph_)
Jun 1, 2023
Now with the recent passing of the debt ceiling deal that will likely squeeze every bit of liquidity from the market, we can see that the government isn’t just trying to destroy crypto, but the whole nation. Why on earth would they do that? Because the destruction of the old makes room for the new.
What happens next?
Stage 3: The solution
As soon as next month, the Federal Reserve is set to launch their new payment system network, FedNow. This will get rid of the slow ACH process and enable instant transactions between banks. It sounds great, but some folks have begun to speculate that FedNow is laying the foundation to usher in a central banking digital currency (CBDC).
Though the Feds deny this claim now, I can’t help but think that it may become true in the near future.
#FedFAQ: Is FedNow replacing cash? Is it a central bank digital currency?
No. FedNow is not related to a digital currency. FedNow is a payments service the Federal Reserve is making available for banks and credit unions to transfer funds. (1/6)
— Federal Reserve (@federalreserve)
Jun 6, 2023
While the financial system continues to fall apart, the US dollar tumbles and crypto crashes for the millionth time, CBDC will be marketed as the grand solution to all the problems.
Stage 4: Dependency
I imagine adoption to be slow. A recent survey conducted by Cato shows that nearly half of Americans don’t even know about the CBDC yet, but eventually, we could hit the stage of dependency. With consumer debt climbing to new heights and the job market declining, a majority of the population will be looking to the government for a lifeline. And there is no better way to introduce a new solution when there is no other choices available.
This all might sound crazy to you, I know. But if we learned anything from these past years, it’s that crazy conspiracies aren’t that crazy anymore 🤷♀️
When we look at all these stories, it’s important to take a step back to see how it fits into the bigger narrative. It’s like when a company launches a new product or feature. How does it fit into their greater company mission and purpose?
Despite the negative mainstream media narratives of crypto, I can’t help but feel more bullish than ever that crypto is the solution, not CBDC. Stay diligent and plan accordingly .
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🐻 Other news to bear in mind
🚨 The SEC wants to freeze Binance.US assets. Following the SEC’s charges against the crypto exchange, they have also filed an emergency motion to freeze Binance US assets. Keep in mind that Binance US is only a small percentage of the business for Binance(dot)com.
🐕️ Dogecoin investors accuse Elon Musk of insider trading (again). Investors of the popular meme coin have filed a lawsuit against Musk once again, claiming that his Twitter posts, appearance on SNL and other behavior wrongfully manipulated the price of DOGE. This is the third time that the lawsuit has been amended. Something tells me that this won’t bother Musk too much.
👍️ Jack Dorsey endorses Robert F. Kennedy Jr as president. Following Kennedy’s keynote speech at Bitcoin 2023 conference, ex-CEO of Twitter Dorsey confirms his support of Kennedy and predicts that he can beat both Trump and DeSantis. What do you think? Did Kennedy’s keynote at Bitcoin convince you enough?
🐾Resources to paw into
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That’s all for this issue. If you could take a moment to give your feedback, I’d greatly appreciate it!