BlockFi’s Lead Investor Bows Out Amid Regulatory Uncertainty

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 31 July 2021

⏱️ 12 minutes

🔗️ Recording | iTunes | RSS

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Summary

Today on the Brief: Robinhood's underperforming IPO and settlement battles MicroStrategy’s continued faith in bitcoin Proposed sweeping crypto legislation Robinhood’s underperforming initial public offering came amid settlement after settlement, with the latest coming with the Financial Industry Regulatory Authority (FINRA). Next on the Brief, MicroStrategy’s second-quarter earnings report lays out the company’s intention to buy more bitcoin. Alongside these crypto ups and downs, the regulatory narrative continues: proposed legislation on digital assets covers everything from the Securities and Exchange Commission’s authority over digital securities to U.S. Treasury authority over stablecoins. In the main discussion, NLW covers BlockFi’s tumultuous run-ins with regulatory bodies in New Jersey, Alabama and Texas, and most recently, Vermont. BlockFi has been making simultaneous appeals to regulators to address their concerns and to their existing customer base to affirm their accounts will not be affected. An unconfirmed report last night, first shared by Eric Newcomer and not able to be confirmed by CoinDesk, claims that a major Wall Street investor has pulled their funding in the midst of the regulatory onslaught. Will BlockFi be the first victim of shifting regulatory winds? Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW The Breakdown is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Razor Red” by Sam Barsh. Image credit: screenshot of BlockFi website.

Transcript

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0:00.0	I've tended to see a fair bit of dismissiveness around some of these things on Twitter
0:04.4	based on the fact that previous regulatory challenges have been sort of nothing burgers, and
0:08.7	I just don't want to see us blindsided.
0:11.0	It's a tightrope for sure, how to be vigilant without being paranoid, how to take seriously
0:15.4	the challenge that new regulations could pose without collapsing into hysterical hyperbole,
0:20.7	how to rip apart headlines for the sake
0:22.4	of nuance.
0:24.6	Welcome back to The Breakdown with me, NLW.
0:28.7	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:35.9	The breakdown is sponsored by Nidig and produced and distributed by CoinDesk.
0:42.3	What's going on, guys? It is Friday, July 30th, and today we are talking about a report that BlockFi's lead investor is bowing out amidst regulatory uncertainty. First up, however, let's do the brief. First on the
0:57.1	brief today, a quick check-in on the Robin Hood IPO. At this point, it's a tale as old as time. Hot
1:04.4	tech company goes public, excitement peaks, before the listing, stock goes live, and instantly drops.
1:12.1	This is the story with Coinbase, and it's the story with Robin Hood.
1:15.6	The difference being that Robin Hood didn't trade up in a big way first like Coinbase did,
1:19.4	but it also didn't fall as far on the other side.
1:22.5	Still, however, ultimately Robin Hood closed 8.4% off its initial price,
1:27.4	which was technically the worst first
1:29.2	session after an IPO of its size ever. Remember, Coinbase was a direct listing. Now,
1:35.3	Robin Hood could have a bit of a tough time ahead of it. Settlement after settlement, it can't seem
1:40.3	to shake legal questions. The latest is Vlad T Tenaf's failure to register with Finra, the
1:45.5	financial industry regulatory authority. The company argues that Vlad doesn't have to because he's
	...

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