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Operation Choke Point 2.0 is an alleged initiative by the Biden administration aimed at restricting crypto firms' access to banking services, drawing parallels to a previous program under Obama. Critics argue that regulatory actions from agencies like the SEC and FDIC have pressured banks to sever ties with the crypto industry, despite official denials of the program's existence. Trump has pledged to dismantle this initiative if re-elected, echoing his previous efforts to end the original Operation Choke Point.
Jump Trading has agreed to pay $123 million to settle SEC charges related to its involvement in the collapse of the algorithmic stablecoin TerraUSD, which resulted in over $40 billion in investor losses. The SEC accused the firm of misleading investors about TerraUSD's stability and violating securities laws during Luna token offerings. Despite earning $1.28 billion from backing TerraUSD, the settlement suggests an acknowledgment of the issues surrounding its actions, prompting calls for stricter regulations in the crypto market.
UBS has intensified lobbying efforts to prevent new regulations following the Credit Suisse crisis, with significant donations to conservative parties raising concerns. The SP calls for a ban on party funding from UBS, arguing that it undermines regulatory independence and accountability. The PUK report highlights how bank lobbying contributed to regulatory fatigue, impacting the effectiveness of FINMA.
Switzerland's banking history is marred by crises, from the 90s real estate bubble to UBS's near-collapse in 2008. Strengthening Finma's powers and clarifying supervisory roles are crucial, yet past political complacency raises concerns about future vigilance and the risk of self-regulation returning. The Confederation must adopt a proactive stance to prevent existential financial crises, particularly regarding UBS's perceived threat.
The European Union's upcoming MiCA regulations, effective December 30, 2024, will ban USDT, the leading stablecoin, from regulated platforms, raising concerns about liquidity and market competitiveness. This strict approach contrasts with more permissive strategies in regions like the U.S., potentially driving talent and investment away from Europe. The challenge lies in balancing regulation with innovation to maintain a robust digital economy.
The Ripple lawsuit against Bradley Sostack is set against a backdrop of regulatory challenges and potential political instability in the U.S. Key dates include a mediation questionnaire due on December 23, 2024, and a critical presentation of arguments in March 2025. The outcome could significantly impact the regulatory landscape for cryptocurrencies, particularly XRP, amid ongoing concerns about the SEC's effectiveness and the broader implications for innovation and investor protection.
The Federal Supreme Court has ruled that cooperative banks must reimburse early repayment penalties due to inadequate information in loan agreements. Borrowers who paid these penalties in 2021 should act quickly, as claims may become time-barred by December 31, 2024. Legal advice is recommended to assess entitlement and calculation errors.
The PUK report on Credit Suisse's downfall presents thirty proposals aimed at enhancing financial supervision and addressing the "too big to fail" issue, emphasizing the need for better coordination among authorities. While the Federal Council acknowledges most recommendations, it rejects a key proposal for stricter residency requirements for board members, citing existing corporate governance regulations. The report highlights the ineffectiveness of FINMA's interventions and raises concerns about the regulatory capture of financial authorities.
The Federal Council has reaffirmed its rejection of a state guarantee for UBS, citing risks of competition distortion and the need for higher capital requirements. The PUK report highlights the unresolved issue of taxpayer protection and calls for stronger regulatory measures, including potential nationalization options for large banks. As Switzerland grapples with the implications of the Credit Suisse crisis, the future of banking regulation remains uncertain.
In 2021, El Salvador became the first country to adopt Bitcoin as legal tender, facing immediate criticism, particularly from the IMF, which cited risks to financial stability and consumer protection. To secure a $1.4 billion liquidity injection, El Salvador is now complying with IMF conditions that limit cryptocurrency adoption, revealing vulnerabilities in its ambitious Bitcoin initiative.
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