March 2024 witnessed pivotal developments across the cryptocurrency and financial sectors, marking a significant period of regulatory scrutiny. [ccpw id=60480] made headlines with the activation of the Dencun upgrade, a monumental step forward in scalability and fee reduction. Meanwhile, the London Stock Exchange announced plans to accept [ccpw id=60415] and Ethereum Exchange Traded Notes (ETNs), signaling growing institutional interest in cryptocurrencies. However, the month was not without its controversies, as former crypto magnate Sam Bankman-Fried faced a 25-year prison sentence over the FTX scandal. Additionally, Ripple Labs encountered a formidable legal battle with the U.S. Securities and Exchange Commission (SEC). These events underscore the dynamic nature of the cryptocurrency landscape and its intersection with traditional finance.
Ethereum Activates Dencun Upgrade to Cut Transaction Fees
The most significant news from March is the Dencun hard fork. It is the most significant Ethereum upgrade since the Merge, went live on the Ethereum mainnet Wednesday 23th March at around 9:55 am ET. This upgrade focuses on scalability, featuring EIP-4844 or Proto-Danksharding, which creates a separate data channel for layer-2 data. This results in significantly lower transaction fees on rollups. Additionally, Dencun includes a total of 9 Ethereum Improvement Proposals (EIPs) making it one of the largest single hard forks in terms of improvements shipped.
The main benefit of Dencun is the reduction in transaction fees with most rollups and users expected to see benefits within hours to days. This improvement is driving anticipation as it brings Ethereum closer to a future where transaction fees are negligible. EIP-4844, likened to the “NoSQL movement of the 2010s,” provides developers with temporary data storage space, fostering innovation without compromising decentralization. Overall, Dencun represents a significant step forward in Ethereum’s journey towards scalability and decentralization.
London Stock Exchange to Accept Bitcoin and Ethereum Crypto ETNs in Q2 2024
The London Stock Exchange (LSE) has announced plans to accept applications for the admission of Bitcoin and Ethereum Exchange Traded Notes (ETNs) in the second quarter of 2024. This decision aligns with the details outlined in the crypto ETN factsheet available on the Exchange’s website. To maintain market integrity, the Exchange will consider applications for Crypto ETNs that meet specific criteria. Issuers must also engage with a custodian subject to Anti-Money Laundering (AML) regulation.
In response to the Financial Conduct Authority’s ban on the sale of derivatives and ETNs referencing unregulated crypto assets to retail consumers, Crypto ETNs traded on the LSE will be available for professional investors only. Prospective issuers are encouraged to engage early with the Exchange to discuss their proposed admission. Additionally, specific timeframes have been set for submitting draft Static Data Forms to prevent potential admission delays.
Sam Bankman-Fried Sentenced to 2 Decades Over FTX Scandal
Sam Bankman-Fried, once a once prominent figure in the crypto world, has been handed a 25-year prison sentence for his role in the FTX fraud saga. This is the most shocking news from March. The verdict was delivered by Judge Lewis Kaplan in Manhattan marked the culmination of a lengthy legal battle that exposed one of the most significant financial deceptions in recent history.
Bankman-Fried, the ex chief of the defunct crypto exchange FTX, was convicted of fraudulent activities and conspiracy to launder money. While the prosecution wanted a harsher punishment of upto 50 years, arguing his extreme greed, the defense advocated for a shorter term of approximately seven years. Despite Bankman-Fried’s attempts to assert his innocence during the trial, crucial testimonies, including from former associate Caroline Ellison, led to his conviction on all charges. The swift jury decision after four hours of deliberation underscores the severity of the case.
Kraken Financial Launches Qualified Custody Solution for U.S. Institutional Clients
Kraken Financial, the state-chartered bank of the Kraken exchange, has introduced qualified custody solution through its institutional arm, Kraken Institutional. Operating under the regulatory framework of Wyoming USA, Kraken Financial is authorized to provide digital asset storage and deposit accounts for institutional investors. It ensures the separation of customer funds and assets from operational funds.
Tim Ogilvie, Head of Kraken Institutional, emphasized the significance of custody services in institutional crypto trading, particularly in light of the recent surge in Bitcoin ETFs. With over 12 years of experience safeguarding client assets, Kraken offers its qualified custody solution as part of its institutional services. Kraken Custody streamlines storage, management, and transfer of crypto assets for institutional clients. Through its launch of custody services, Kraken aims to lead institutional-grade cryptocurrency offerings, facilitating institutional investors’ entry and success in the crypto market.
SEC Seeks $2B in Fines from Ripple Labs, Legal Officer Reveals
In a legal saga of epic proportions, Ripple Labs faces a monumental challenge as the U.S. Securities and Exchange Commission (SEC) pursues fine totaling up to $2 billion. Stuart Alderoty, Ripple’s Chief Legal Officer, disclosed this alarming development. At the heart of the dispute lies the SEC’s accusation that Ripple unlawfully sold unregistered securities, specifically its cryptocurrency $XRP. Ripple vigorously contests these claims and now it is preparing to mount a robust legal defense in April.
The outcome of this high-stakes confrontation carries significant ramifications for the cryptocurrency industry. Judge Analisa Torres’s recent ruling, which favored Ripple by excluding certain XRP sales from being deemed securities, has been closely watched by other crypto firms under SEC scrutiny. Now observers await further developments, anticipating how the company will navigate this complex legal terrain. Ripple’s case holds far-reaching implications, influencing the trajectory of crypto regulation and innovation. It’s a pivotal moment, shaping the future landscape of digital finance and regulatory clarity.
In conclusion, March 2024 was a month of profound significance for the cryptocurrency industry. It was marked by pivotal events that underscored its dynamic nature and regulatory challenges. Ethereum’s activation of the Dencun upgrade represented a monumental leap forward in scalability and fee reduction, while the London Stock Exchange’s decision to accept Bitcoin and Ethereum ETNs signaled growing institutional interest in cryptocurrencies. However, controversies such as Sam Bankman-Fried’s sentencing and Ripple Labs’ legal battle with the SEC highlighted the sector’s susceptibility to legal scrutiny. These developments underscore the critical juncture at which the cryptocurrency industry stands, shaping its future trajectory and regulatory landscape.
