January 19, 2024

🥛 Crypto’s next big battle ⚔️

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GM. This is Milk Road, your daily dose of crypto, more reliable than your old flip phone's battery life.

Here’s what we got for you today:

  • Coinbase vs. the SEC ⚔️

  • How Bitcoin miners are stabilizing Texas’ energy grid 🪫

  • Bitcoin just lapped silver 🍪


Crypto is a lot like a video game – before leveling up, there’s a boss fight. 

Except in crypto, it’s the same big, bad boss every time… the SEC. 

Right now, the fight is the SEC vs Coinbase.

Here’s what’s going on:

  • The SEC sued Coinbase for “operating as an unregistered broker, exchange, and clearing agency” last year.

  • In the process, the SEC accused Coinbase of selling securities and namedropped 13 cryptocurrencies including SOL, ADA, MATIC, etc.

  • The SEC is arguing those tokens are securities because people buy them as a way to invest in a common “enterprise” and possibly profit from its success. (According to the Howey Test, that makes it a security).

  • Coinbase is arguing that buying tokens doesn’t guarantee the buyer any rights (or profits) as part of the purchase. The exchange compared buying tokens to buying Beanie Babies, which aren’t securities. 

Earlier this week, both sides were able to make their oral arguments in court, in front of a judge. 

The bad news… the Judge hasn’t made any official ruling yet. 

The good news… many people think Coinbase is the “favorite” to win and can get the case dismissed after this week's arguments. 

Here are some of the best reactions from Twitter:

Why this case matters: The judge's decision in this case will likely clarify the SEC's jurisdiction over the crypto sector and could set a precedent for how crypto is regulated in the U.S.

  • If Coinbase wins, it could put a lot of tokens “in the clear.” 

  • If the SEC wins, it could further muddy the waters around what tokens are securities and which ones aren’t. 

We’ll be keeping a close eye on this one.


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Texas is one of the weirdest places on Earth… 

  • In the summer, it gets so hot you can go outside and fry an egg on the sidewalk (not recommended, but it is possible).

  • In the winter, it gets so cold you don’t even need a fridge/freezer – just leave your food outside and it’ll stay cool (again… not recommended, but possible).

You get the best worst of both worlds in Texas. 

Right now, it’s getting hit by an “Arctic Blast”. Which sounds like a new drink at Taco Bell, but it just means it’s cold as f*ck. 

The problem: when Texas gets hit by extreme weather, the energy grid goes through a lot of stress. 

The solution: Bitcoin miners are helping stabilize the energy grid. 

  • Miners get paid to curtail their operations and shut off their machines.

  • As a result, it frees up energy on the grid that can be used elsewhere (i.e., homes, hospitals, local businesses).

It’s a win-win for everyone.


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Bitcoin surpasses silver to become the second-largest ETF commodity in the U.S. In the words of the great Ludacris… ‘move, b*tch, get out the way!’

dYdX passed Uniswap as the largest decentralized exchange (DEX) by volume. The DEX recently migrated from Ethereum to Cosmos and just saw $757M in volume over 24 hours. 

The total value of crypto received by “illicit addresses” has dropped from $39B → $24.2B. This only made up about 0.34% of all on-chain transaction volume last year.

Tether bought $380M worth of Bitcoin. The stablecoin issuer now owns 66,464 BTC (worth ~$2.8B).

Bitcoin’s hash rate dropped 25% this week. The big reason why? There’s a huge winter storm in Texas, so miners there are curtailing power to help strengthen the local power grid. 

BlackRock says its spot bitcoin ETF is attracting a diverse investor base. BlackRock Head of U.S. iShares Product Rachel Aguirre said both retail and new investors are interested in the firm’s spot bitcoin ETF.






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