The regulator is releasing final guidance to help member states get ready for MiCA which is set to take effect imminently, as some nations are trailing behind.
The European Securities and Markets Authority (ESMA) has released its final guidance on Tuesday to help member states implement the impending rules.
ESMA published its final report on reverse solicitation, systems, what crypto may constitute as a financial instrument and draft technical standards on market abuse prevention.
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The European Union’s Markets in Crypto Asset (MiCA) rules – bespoke rules for the crypto sector – are meant to come into force by December 30 across the bloc of 27 nations. But some countries are yet to put in place legislation to implement MiCA.
Portugal’s central bank even told CoinDesk on Monday that it is yet to figure out which national competent authority will be responsible for the rules since legislation has not passed.
A part of what caused delays for national competent authorities was the short period between ESMA releasing its final technical standards in October and the implementation date, industry trade associations told CoinDesk.
“Looking ahead, as the transitional period progresses, we will continue to provide guidance and work with all [National Competent Authorities] NCAs to ensure the smooth implementation of MiCA and to support a level playing field through supervisory convergence actions,” Verena Ross, ESMA Chair, said.
The crypto company behind USDT, the largest stablecoin, decided to shutter its own euro-pegged stablecoin and back smaller issuers that comply with the EU’s MiCA regulations.
Tether, the crypto company behind the $140 billion USDT cryptocurrency, said on Tuesday it has invested in European stablecoin company StablR.
StablR issues euro and U.S. dollar stablecoins EURR and USDR and obtained an electronic money institution (EMI) license in Malta in July, a necessary step to comply with EU-wide regulations.
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Tether will also support StablR’s operations with its recently unveiled tokenization platform Hadron, providing tools for compliance, know-your-customer (KYC) and anti-money-laundering (AML) checks, risk management and secondary market monitoring.
The firms did not disclose the size of the investment nor the valuation. A Tether spokesperson told CoinDesk that Tether now has a “significant equity position” in StablR.
The investment is the latest example of Tether’s strategy to keep a foothold in the EU by backing smaller issuers and providing services through its tokenization platform Hadron as the bloc’s MiCA regulation enters into force by the end of this year. The firm decided to shutter its own euro-pegged stablecoin last month, while invested in Netherlands-regulated payments firm and stablecoin issuer Quantoz.
“The European stablecoin market is at a turning point, with regulation finally catching up to innovation,” Tether CEO Paolo Ardoino told CoinDesk. “The company sees the evolving regulatory landscape as a positive step forward but is concerned about the systemic risks it introduces, particularly within the already vulnerable European banking sector.” Tether has been a vocal critic of the MiCA rules that require major stablecoin issuers to hold a large part of the backing assets in bank deposits. The company holds over 83% of USDT reserves in U.S. government bonds, repo agreements and money market funds.
Stablecoins, or cryptocurrencies with steady prices pegged to fiat currencies, are a $200 billion and quickly growing class of digital assets. They are popular as liquidity for crypto trading and are getting increasingly used for everyday payments and remittances due to cheaper and faster settlements using blockchains instead of traditional banking rails. U.S. dollar stablecoins dominate the market with a nearly 99% share, while their euro counterparts lagged in adoption sitting at just about $400 million in market value.
The medical device company adopted a bitcoin treasury strategy earlier this year and currently holds 2,084 tokens worth roughly $220 million.
The analyst who wrote this piece owns shares of Semler Scientific (SMLR) and MicroStrategy (MSTR).
Shares of Semler Scientific (SMLR), the small-cap medical device maker that adopted a bitcoin treasury strategy earlier this year, are now available for options trading.
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This comes after six months of share-price growth for the company driven by its bitcoin (BTC) pivot and capital-raising initiatives. Semler had requested approval on Dec. 5 from options exchanges to allow options trading as the company believed it met the eligibility requirements.
Though no official announcement has been made, a check of brokerage accounts Tuesday morning U.S. hours showed the options as available to trade.
Options are financial contracts that give the investor the right, but not the obligation, to buy or sell a stock at a specified price before a certain date. The introduction of options on a stock gives investors new tools to hedge risk and speculate on price movements.
Among the requirements needed for an options market to be granted are a minimum share price of around $3-$5, a minimum market capitalization of at least $75 million and sufficient trading volume of around 500,000 to 1 million shares per day. Additionally, a minimum number of publicly available shares and sufficient number of shareholders are required.
Semler’s stock price has almost tripled to more than $74 as of Monday’s close since making public its initial bitcoin purchases on May 28. It has a market cap topping $600 million. SMLR is ahead 5% in premarket action Tuesday to $78.20.
The company recently filed a second prospectus supplement under its S-3 Shelf, which has seen an additional $50 million in share offerings under its existing at-the-market (ATM) program, increasing the total offering to $150 million. To date, the company has raised approximately $100 million in proceeds through ATM issuance.
Semler to date has acquired 2,084 bitcoin for $168.6 million, or an average price of about $81,000 each. Those holdings are worth about $222 million at bitcoin’s recent price of roughly $106,500.
Semler may be looking to recreate the success mammoth bitcoin holder MicroStrategy (MSTR) has achieved through the issuance of convertible notes to raise capital for accumulating more tokens. By not causing immediate dilution of existing shares, convertible offerings can be a more attractive way than share offerings to raise cash. The active options market Semler is hoping for allows investors an easy way to hedge, thus making convertible paper more attractive to potential buyers.
Disclaimer: This article, or parts of it, was generated with assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy.
The Ethereum Name Service’s forthcoming Namechain will be based on Linea, a zero-knowledge rollup.
ENS Labs, the company behind the Ethereum Name Service, said Tuesday that it picked Linea’s technology to build its upcoming layer-2 network, Namechain.
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Linea is a zero-knowledge rollup that came out in July 2023 and was built by Ethereum infrastructure giant Consensys. It is the seventh-largest rollup network, according to L2Beat, with $1 billion locked in its ecosystem.
ENS Labs said it picked Linea to build its network for two reasons. “One is sort of values alignment,” said Nick Johnson, the founder and lead developer of ENS. The other has to do with speed.
Rollups are a special type of blockchain where one can transact faster and at a lower cost. There are two kinds of rollups: optimistic and zero-knowledge. Optimistic rollups use optimistic proofs, which have a seven-day window to dispute transactions before they are finalized (proofs are assumed to be “optimistic” that no one will dispute their contents). Zero-knowledge rollups, by contrast, use zero-knowledge cryptography, seen by many as a superior technology, to secure proofs and finalize those proofs within minutes.
ENS has been described as “the phone book for Web3,” but a more precise analogy is the web’s domain name service (DNS). The domain name “CoinDesk.com” is easier to remember and type than a numerical IP address. Similarly, ENS handles like parishilton.eth, which the namesake heiress acquired in 2021, are more relatable than the strings of letters and numbers that make up Ethereum wallet addresses.
For this service, “we need fast finality,” Johnson said. That’s because “you want to be able to update your ENS name and have the chain reflect it in the smallest interval possible. And to do that and have it remain decentralized and secure, we need fast finality, and optimistic roll-ups can’t deliver that,” Johnson said.
The news comes as other major crypto projects announce their intentions to roll out layer-2 networks, though unlike ENS, some of the biggest names in blockchain have tapped Optimism’s OP Stack to build out their networks.
ENS will be one of the first major projects to build out a layer-2 blockchain based on Linea’s technology (Linea is also building a layer-2 network for blockchain wallet application Status.)
The team behind Linea said last month that it plans to issue a Linea token. Both Johnson and Nicolas Liochon, the founder of Linea, told CoinDesk that there are no concrete plans yet for how that token would be used in the Namechain ecosystem.
Liochon said having the Namechain team working on the Linea stack will help strengthen and decentralize the L2 protocol.
“We really want to have multiple organizations contributing to Linea, and we work on having more organizations too, as a way to make [the network] more secure,” he said. “So really, we want to have multiple teams so there’s no centralization point.”
$90 million worth of PENGU has traded in its first hour of release.
PENGU, the native token of non-fungible token (NFT) project Pudgy Penguins, has debuted at a $312 million market cap after the token was distributed to NFT holders via an airdrop.
The Solana-based token has a total supply of 88.88 billion and has racked up around $90 million in trading volume in the first hour since release, CoinMarketCap shows.
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23.5% of PENGU’s supply was allocated to the airdrop while a further 22% has been set aside from Solana and Ethereum communities. An additional 12.3% of supply will also be used as liquidity on decentralized exchanges.
The floor price of the Pudgy Penguin NFTs has risen alongside the release of PENGU, with the cheapest NFT now trading at 34.1 ETH ($136,000) to mark a 2.6% increase. It is now the second most expensive collection after CryptoPunks.
It has outperformed the wider NFT market which remains in a multi-year slump following the emergence of meme coins this cycle. NFTs were the plat du jour in 2022 amongst the more speculative crypto investors, but as hype and liquidity withered away so did asset prices. Trading volume on NFT exchange OpenSea topped $2.7 billion in a single day in 2022, whilst this month it has struggled to top $30 million.
Nigeria has been clamping down on illegal activity regarding crypto in the country.
Nigeria arrested 792 people following a raid at a building where people allegedly committed crypto-related scams, Reuters reported on Monday.
The suspects would lure victims, typically from America and Europe, with romantic offers before asking them to hand over money for fake crypto investments, the report said.
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The people, who included Chinese and Filipino nationals, were detained last week at a seven-floor building in Lagos, Economic and Financial Crimes Commission spokesperson Wilson Uwujaren told Reuters.
“Once the Nigerians are able to win the confidence of would-be victims, the foreigners would take over the actual task of defrauding the victims,” he said.
Nigeria has been clamping down on illegal activity related to crypto. At one point it was reported that the country had blocked several exchanges from operating within its borders. More recently the country has been in an almost year-long legal dispute with Binance and its executives over alleged money laundering and tax evasion charges.
CoinDesk reached out to Nigeria’s Economic Financial Crimes Commission for a comment.
Fuel claims to be the fastest and cheapest Ethereum rollup.
Fuel, a layer-2 network built on Ethereum, has announced that airdrop claims for its native token will open on Dec. 19, with ten percent of the total supply being allocated to more than 200,000 eligible wallets.
The window for airdrop claims will run for one month. 28% of the airdrop allocation will go to phase-1 pre-depositors, 20% to those who used the Fuel bridge, and 12.5% to “NFT connoisseurs.”
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Fuel claims to be the fastest and least expensive rollup on Ethereum. It boasts a transaction processing speed of up to 600 TPS at around $0.0002 per transaction. Fuel achieves this via parallelization, state minimization and interoperability. For comparison, Arbitrum, the largest layer-2 by TVL, has averaged 27.6 TPS over the past 24 hours, while Base is averaging around 90 TPS, according to L2BEAT data.
The token will have a maximum supply of 10 billion and users on the network can still earn “points” for Fuel phase 2, which can eventually be converted to the FUEL token.
Fuel’s block explorer shows that it has processed 154,000 transactions over the past 24 hours and has 63 active decentralized applications (dapps).
The investment round was led by Haun Ventures and included contributions from Coinbase Ventures and Tiger Global.
Stablecoin infrastructure platform BVNK has raised $50 million in Series B funding as it seeks to expand its U.S. operations.
Formed in late 2021, BVNK raised $40 million in Series A funding the following May and won registration in Spain a few months later.
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For the past year, the London-based company has been expanding in the U.S., opening an office in San Francisco, building a team and applying for operational licenses.
BVNK has applied for licenses in all U.S. states, securing approval in several, including Alabama, Arizona, Delaware, Florida, Michigan and New Hampshire, the company told CoinDesk in an e-mail.
The latest investment round was led by Haun Ventures and included contributions from Coinbase Ventures and Tiger Global, BVNK said on Tuesday.
The company aims to help businesses incorporate stablecoin payments into their processes, such as paying contractors worldwide, instant settlement with merchants and sending payouts without delays and exchange-rate risks.
OFAC says a front company in the UAE had been converting crypto into cash for North Korea.
The U.S. Treasury Department on Tuesday said it had shut down a North Korean money laundering network that used crypto to clean millions of dollars for the hermit kingdom, a global leader in crypto crime.
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A front company in the UAE called Green Alpine Trading, LLC, had been converting crypto into cash for North Korea, according to a press release by the Treasury’s Office of Foreign Assets Control (OFAC). The U.S. government’s sanctions wing stuck that company on its blacklist as well as two Chinese nationals who had been participating in the network since 2022.
The United Arab Emirates partnered in the takedown, according to the press release. It is not clear what’s become of the two now-sanctioned Chinese nationals, Lu Huaying and Zhang Jian. They worked in cahoots with DPRK “agent” Sim Hyon Sop, the press release said.
North Korea is among the most aggressive state actors to target the crypto industry. Its agents have allegedly stolen billions of dollars worth of crypto to fund the country’s nuclear weapons program. But making digital cash useful, requires its conversion into fiat.
Green Alpine may have played a small part in that web. The Treasury press release didn’t say what money it laundered, beyond that it was from “illicit revenue generation schemes.”
Read more: How North Korea Infiltrated the Crypto Industry
Senator Tim Scott said the Senate will tackle crypto bills, and the incoming chair of the House Financial Services Committee said he hopes to pass them in 2025.
WASHINGTON, D.C. — The crypto industry got a promise for action Tuesday from the Republican U.S. lawmakers who will have the authority to move digital assets legislation, with key members of the Senate and House of Representatives saying the sector will finally get what it’s awaited for years.
The incoming Republican chair of the U.S. Senate Banking Committee, Senator Tim Scott, and his counterpart on the House Financial Services Committee, Representative French Hill, were welcomed with enthusiasm by a Blockchain Association crowd in Washington, in sharp contrast to the uncertain tone of the same event last year. The two lawmakers said at the policy event that both chambers of Congress and the administration of President-elect Donald Trump will all be pulling in the same direction to make legislation happen.
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The two starting points, they said, will be the Financial Innovation and Technology for the 21st Century Act (FIT21) — the bill to establish comprehensive crypto market guardrails that cleared the House this year by a wide bipartisan margin — and a stablecoin bill that was close to a bipartisan deal but ground to a halt over a few sticking points around the role of the federal and state governments.
“Congress needs to do its job, find a compromise and put things right,” Hill said, suggesting his aim is to get passage of crypto market-structure legislation — something “like FIT21” — in the first few months of the session.
That’s a familiar message from the House side of Congress, but it’s the Senate that had long been the source of resistance. Senator Scott will soon arrive in his committee chairmanship with a stark reversal of Democrat predecessor Senator Sherrod Brown’s crypto suspicion.
“In my opinion, it is the next wonder of the world,” he said, also promising that his panel would have a crypto offshoot. “I’m going to be the chairman that creates a digital assets subcommittee for the first time.”
Senator Brown, the current chairman, lost his Ohio Senate race in November, overcome by Republican Bernie Moreno, a blockchain businessman. Brown had been a key constraint to crypto progress in the Senate, though the new top Democrat of the committee will be Senator Elizabeth Warren, the progressive firebrand from Massachusetts, who is expected to loudly criticize crypto from the sidelines in the next couple of years.
Scott acknowledged, “She’s very good at what she does.”
But he said, “I think the future’s incredibly bright,” and he said he’s already started conversations on crypto policy.
Representative French Hill (right), the next chair of the House Financial Services Committee, predicted crypto legislation in 2025. (Nikhilesh De/CoinDesk)
Hill argued that crypto legislation can’t properly happen without wide bipartisan support.
“To win, ultimately, you need 60 votes in the Senate,” he noted. “You need to build consensus.”
Most Republicans have drifted into the crypto camp over the years, a trend that accelerated since last year. But some Democrats — often younger lawmakers — have joined them, culminating in 71 Democrat votes for FIT21 in the House. But the Senate will be closely divided, with 53 Republicans to 47 Democrats, so both parties must be involved in any major initiative.
SEC’s role
Also at the Blockchain Association Policy Summit on Tuesday, the U.S. Securities and Exchange Commission’s two Republican commissioners — Mark Uyeda and Hester Peirce — spoke about the changes they expect at the agency next year.
Uyeda criticized the agency’s crypto accounting standard, the controversial Staff Accounting Bulletin No. 121 (SAB 121), which he said had “very, very wide-ranging ramifications” for a policy that didn’t go through the proper channels.
Peirce said that while the regulator awaits new digital assets laws from Congress, “we can say some of this stuff is just outside our jurisdiction.”
“We can certainly work closely with the CFTC,” she said. “We stand ready to work on things once that’s a possibility. … I think there are a lot of places for us to help.”
