Here’s What You Missed in Crypto This Week

Coinbase files action against SEC on crypto clarity as Binance.US terminates deal for Voyager assets

As bitcoin, ethereum and other cryptocurrencies get increasing attention from investors, Wall Street and its traditional banks continue to adjust to the shift. Catch up on this week’s top stories highlighting the intersection of these old guard and new school areas of finance with this recap compiled by The Fly.

COINBASE FILES ACTION AGAINST SEC ON CRYPTO CLARITY: Coinbase (COIN) Chief Legal Officer Paul Grewal said in a Monday blog post that the company filed a narrow action in the U.S. Circuit Court "to compel the SEC to respond ‘yes or no’ to a rulemaking petition we filed with them last July asking them to provide regulatory guidance for the crypto industry.”

The company said, “The SEC is required by law to respond to petitions ‘within a reasonable time,’ but they have not yet responded to our petition from last July, which is why we filed our action in court today. It’s obvious that there’s a lack of clarity among our regulators regarding crypto, as even the chair of the SEC has declined to say which crypto assets are securities. The crypto industry, and its users need clear laws and rules to follow that are built for a new technology. Enforcement actions based in inapplicable securities law aren’t the answer."\

On Wednesday, H.C. Wainwright initiated coverage of Coinbase with a Buy rating and $75 price target. Coinbase is the largest centralized cryptocurrency exchange in the U.S. and second largest in the world, processing $830B in total crypto trading volume for retail and institutional investors in 2022, the analyst said. The firm is not ruling out the potential for additional downward share pressure over the short-term as investors learn more about the SEC’s probe and potential actions against Coinbase. However, it is "very constructive" on shares over the near- to medium-term based on the current valuation and where we are in the crypto price cycle. "Crypto winter is over, and spring has sprung," H.C. Wainwright wrote.

Additionally in a Thursday blog post, Grewal stated in part: "Last month, we shared that we received a vague and broad Wells notice from the SEC – today we’re sharing our response to the SEC. We provided a written and video submission to the SEC, and we discussed those submissions with the SEC a few days ago. Coinbase is the same company that we were when the SEC allowed us to become public two years ago, after detailed discussions with us about the very aspects of our business that are now the subject of the Wells notice. We didn’t list securities then, and we still don’t. We’d like to in the future, but the SEC has still not complied with the law by providing companies like Coinbase with a way to register to be able to do that. We do not relish litigation against the SEC, but we will vigorously defend ourselves – and stand up for the rule of law for everyone. In the meantime, the financial system still needs updating, so we’ll continue building. We will also continue to ask Congress for legislation and the SEC for rulemaking so that regulatory clarity isn’t left to the courts."

BINANCE.US TERMINATES DEAL FOR VOYAGER ASSETS: Voyager Digital (VYGVQ) tweeted on Tuesday from its official Twitter account: "Today we received a letter from Binance.US terminating the asset purchase agreement. While this development is disappointing, our chapter 11 plan allows for direct distribution of cash and crypto to customers via the Voyager platform… Consistent with the plan, we will now move swiftly to return value to customers via direct distributions. We will provide more information on next steps and any actions customers need to take in the coming days.”

IRIS ENERGY INCREASES HASHRATE TO 5.2 EH/S: Iris Energy (IREN) announced Wednesday it has increased its operating hashrate from 4.6 EH/s to a current level of 5.2 EH/s. All remaining 0.3 EH/s of miners have been delivered and are pending installation. In addition to 160MW of operating data centers in BC, commissioning of the first 20MW at Childress is nearing completion. The Company advises that the first 20MW data center is now operational at Childress, Texas. Following energization of the 100MW primary substation on April 22, 2023, the first batches of miners have been installed and are currently hashing. Commissioning of the balance of the 20MW data center is expected imminently.

Prior to the news, B. Riley analyst Lucas Pipes raised the firm’s price target on Iris Energy on Tuesday to $5 from $4 and kept a Buy rating on the shares. The company provided an installation update last week where it increased its operating hash rate to 4.6 EH/s, for a 48% increase in under three weeks, the analyst said. The firm cited strong execution for the target raise.

BITFARMS REACHES HASHRATE OF 5 EH/S: Bitfarms (BITF) announced Monday it has reached 5 EH/s of production on April 27, 2023. As disclosed on April 24, 2023, in Argentina, 2,100 new miners were energized and the underclocking of existing miners was discontinued as scheduled, directly contributing an additional 250 PH/s of total production.

Geoff Morphy, CEO of Bitfarms, said, "Bitfarms reached a new all-time high of 5.0 EH/s by expanding production at our Rio Cuarto farm in Argentina to 18 MW. This exciting moment reflects our team’s hard work over the last two years resulting in our largest, most advanced and lowest cost facility. With our new miner purchases and further expansion opportunities, we expect our farm in Argentina to be a significant growth driver in the coming months as we build toward our year-end goal of 6.0 EH/s."

MICROSTRATEGY INITIATED WITH BUY: Berenberg analyst Mark Palmer initiated coverage of MicroStrategy (MSTR) on Thursday with a Buy rating and $430 price target. The analyst views the stock as offering equity investors an attractive way to express a view on bitcoin. MicroStrategy offers an alternative with a correlation to bitcoin of 0.90, the analyst said. The firm noted that since MicroStrategy launched its bitcoin acquisition strategy on August 10, 2020, its share price has appreciated by 143% while the price of bitcoin increased by 139% during that span.

CRYPTO STOCK PLAYS: Cryptocurrency revenues have been pointed to as reasons to be bullish on Advanced Micro Devices (AMD) and Nvidia (NVDA) in select research. Ideanomics (IDEX), Riot Platforms (RIOT), Overstock (OSTK), and SRAX (SRAX) are other stocks that have been touted, or promoted themselves, as a way to play the crypto theme.

PRICE ACTION: As of time of writing, bitcoin rose roughly 3% this week to $28,998 in U.S. dollars, according to TradeBlock.

Keywords: bitcoin, ethereum, dogecoin, litecoin, crypto, cryptocurrency, cryptocurrencies, token, stocks, blockchain, stablecoin, regulation