Read in the Digest:
- OKX fail to process transactions for hours over intermittent outage at Alibaba
- Nigeria proposes bill to legalize the use of Bitcoin (BTC) and other cryptos
- Crypto analyst draws similarity between collapsed Terra and Binance’s BNB
- Democrats plan on returning more than $1 million in Bankman-Fried donations
- Hester Peirce, “Crypto Mom,” says the SEC’s Howey test has its limitations
OKX Fail to Process Transactions for Hours Over Intermittent Outage at Alibaba
Seychelles-based cryptocurrency exchange OKX suffered a connection issue that halted deposits and withdrawals on the platform for more than 25 hours, starting in the early hours of Sunday, December 18th.
OKX clarified that the exchange’s failure to process deposits and withdrawals was due to a hardware failure in Alibaba Cloud’s Hong Kong data center, the exchange’s primary infrastructure provider.
On-chain data showed one million SOS sent being recorded as the last transaction that OKX processed before the outage. Transactions have been restored at OKX, as Alibaba fixed the issues in its Hong Kong IDC Zone C server.
Deposits and withdrawals for BTC, ETH, TRX, USDT, USDC, and other TRC20 and ERC20 tokens resumed on Monday, December 19th, at 4:00am UTC. OKX also announced that deposits and withdrawals for other tokens listed on the exchange would resume at 9am.
- The exchange clarified that customers’ funds remained safe throughout the period of the outage.
Why You Should Care
With the increasing scrutiny on centralized exchanges, the outage and relationship with a single cloud provider could hurt OKX’s image.
Nigeria Proposes Bill to Legalize the Use of Bitcoin (BTC) and Other Cryptos
Twenty-two months after the Central Bank of Nigeria (CBN) placed a blanket ban on cryptocurrencies, the African nation is reportedly looking to pass a law recognizing the use of Bitcoin and other cryptos for transactions.
As reported by local media, Ibrahim Babangida, Chairman of the House of Representatives Committee on Capital Markets and Institutions of Nigeria, says the nation will soon pass the law to keep up with “global practices.”
The bill would amend the 2007 Investments and Securities Act and recognize bitcoin as legal capital for investment. If the amendments pass, the nation’s SEC will “recognize cryptocurrency and other digital funds as capital for investment.”
Despite the CBN ban on cryptos in February 2021, Nigeria remains one of the countries with the highest peer-to-peer crypto trading volumes worldwide, along with Thailand and the Philippines.
- However, Babangida noted that the law will not completely lift the CBN on cryptocurrencies but only will make their use legal.
Why You Should Care
If the bill addresses the growing crypto usage within the country, it could be a major catalyst for Nigeria to grow its crypto sector and economy.
Crypto Analyst Draws Similarity Between Collapsed Terra and Binance’s BNB
Crypto has seen several tragedies in 2022, with the collapse of Terra’s ecosystem resulting in the second-biggest realized loss in the industry at $20.5 billion. However, a crypto analyst has predicted that Binance Coin (BNB) could follow the same path.
According to crypto analysts, @SmartContracter aka Bluntz, “the 5-year uptrend in BNB/BTC has come to an end,” a trend that came before the collapse of Terra’s LUNA and UST in April this year.
Bluntz suggests that with the uptrend ending, the BNB could experience a minimum 40-50% price plunge from here. He adds that he will “be avoiding this coin like the plague from here.”
Bluntz backs up his claims by highlighting his prediction of a 50% downtrend for Terra, which came before the collapse. His predictions came in April. Terra’s stablecoin (UST) would lose its peg in May, leading to the collapse of the ecosystem.
- The potential of a downtrend for BNB is strengthened by the increasing FUD surrounding the exchange, as concerns over its reserves grow.
Democrats Plan on Returning Over $1 Million in Bankman-Fried Donations
Before the implosion of FTX, Sam Bankman-Fried was known as a prolific political donor, with Elon Musk alleging that he donated more than $1 billion to politicians, especially Democratic campaign groups.
However, with charges of conspiracy and wire fraud, recipients of SBF’s generosity are looking to return their donations. According to a report, three Democratic campaign groups are preparing to return over $1 million received from SBF.
The Democratic National Committee (DNC) could return as much as $815,000, while the Democratic Senatorial Campaign Committee (DSCC) and the Democratic Congressional Campaign Committee (DCCC) are setting aside $103,000 and $250,000, respectively.
A DNC spokesperson said that “given the allegations around potential campaign finance violations by Bankman-Fried,” the committee will “return as soon as we receive proper direction in the legal proceedings.”
- SBF was the second-largest “CEO contributor” to Biden’s 2020 presidential campaign, with $5.2 million in donations.
Why You Should Care
The Democrats’ decision adds to the pressure on other political organizations yet to decide what to do with SBF’s donations.
Hester Peirce, “Crypto Mom,” Says the SEC’s Howey Test Has its Limitations
In a recent podcast, SEC Commissioner Hester Peirce, popularly known as the “crypto mom,” said that the Howey test, used to determine whether a digital asset should be classified as a security, has some limitations.
While the SEC chairman Gary Gensler has said “many tokens may be unregistered securities,” Peirce argues otherwise, saying, “just because I sold you the orange grove as part of an investment contract doesn’t turn the orange grove into a security.”
According to the crypto mom, defining crypto as a security is not addressed by the Howey test. She said it is a “much harder question to answer, and I think it’s one that people answer differently.”
Pierce adds that because of the importance of the subject, there needs to be clarity on what makes a digital asset a security or a commodity. However, she said there had been no “positive movement” on regulation since she joined in 2018.
- The classification of digital assets as securities or commodities is an issue that the SEC boss has avoided, only stating that Bitcoin was not a security.
Why You Should Care
Peirce says there would be fewer objections to applying the Howey test if the SEC had a different approach to regulating cryptos.