Crypto News Today: U.S. Senate Votes against SEC | CME Group to List BTC | JPMorgan on BTC Mining

Ibrahim Ajibade
Published: May 17, 2024, 22:00 GMT+00:00

Key Points:

  • The Chicago Mercantile Exchange (CME) Group moves to launch Spot Bitcoin trading services.
  • In a research report, JPMorgan pointed to a decline in Bitcoin’s mining costs after the 2024 BT halving event.
  • Lawmakers in the United States Senate voted on a joint resolution, to overturn an SEC rule affecting financial institutions doing business with cryptocurrency firms.
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Crypto News Today: U.S. Senate votes against SEC crypto rule, CME Group plans spot Bitcoin trading, and JPMorgan reports a drop in Bitcoin mining costs. Stay updated on the latest developments in cryptocurrency.

In today’s crypto news, the U.S. Senate votes to overturn an SEC rule affecting banks’ dealings with cryptocurrency firms. Likewise CME Group plans to introduce spot Bitcoin trading, while JPMorgan reports a significant drop in Bitcoin mining costs following the recent halving event.

These developments signal major shifts in regulatory and market dynamics within the cryptocurrency space.

CME Group Eyes Spot Bitcoin Trading

The world’s leading futures exchange CME Group, is planning to launch spot trading for Bitcoin, capitalizing on the surging interest from Wall Street money managers in the cryptocurrency.

The Chicago-based exchange has been in talks with traders seeking a regulated platform to buy and sell Bitcoin, according to sources familiar with the discussions.

This move, which hasn’t been finalized, follows the U.S. Securities and Exchange Commission’s approval of spot Bitcoin exchange-traded funds in January, which have attracted investment from Wall Street giants including JPMorgan and Wells Fargo.

Other large investors, including hedge funds like Bracebridge Capital and pension funds like the Wisconsin Investment Board, have also poured billions into spot Bitcoin exchange-traded funds.

Offering spot trading alongside existing Bitcoin futures contracts would allow investors to engage in basis trades, a common strategy for professional traders, in which traders sell futures contracts while buying the underlying asset – in this case Bitcoin – to profit off of the small gap between both.

CME, an exchange catering to large hedge funds and proprietary traders, emerged as the largest Bitcoin futures market over the renewed institutional interest in the crypto space.

The proposed spot trading operation would be run via the EBS currency trading platform in Switzerland, known for its comprehensive regulatory framework overseeing the trade and custody of cryptocurrency assets.

Bitcoin Mining Costs Dropped Below $50,000 Per BTC: JPMorgan

In a research report, JPMorgan pointed to a decline in Bitcoin’s mining costs after the recent halving event, using the current hashrate and power consumption of the Bitcoin network to estimate mining costs of around $45,000 per BTC.

Bitcoin (BTC) Price Action May, 12 - May, 17 2024. | Crypto News Today
Bitcoin (BTC) Price Action May, 12 – May, 17 2024.

The figure is down from previous estimates exceeding $50,000, and the drop was attributed to declining hashrate after the halving event, which cut the Coinbase reward miners receive per block found in half, as unprofitable miners exit the network.

JPMorgan’s analysts noted that there was a delayed exit, which was attributed to the launch of the Runes protocol, a new token creation method within the Bitcoin network that triggered a temporary spike in transaction fees, which in turn offset the halving’s impact.

The report emphasized the boost provided by Runes was short-lived, as transaction fee revenue has since fallen dramatically. As power consumption in the network has fallen more than its hashrate, it adds, unprofitable miners with inefficient operations exited.

JPMorgan’s report sees limited Bitcoin upside in the near future over several headwinds, which include a lack of positive catalysts and the disappearing impulse of retail crypto investors.

U.S. Senate Votes to Overturn SEC Rule on Crypto

Lawmakers in the United States Senate voted 60 to 38 to pass a joint resolution, H.J.Res. 109, aiming to overturn a Securities and Exchange Commission (SEC) rule affecting financial institutions doing business with cryptocurrency firms.

The resolution aims to nullify Staff Accounting Bulletin No. 121, which mandates that banks must keep customers’ digital assets on their balance sheets and maintain sufficient capital against them, something that many lawmakers and industry leaders see as stifling innovation.

The resolution previously cleared the U.S. House of Representatives and now faces a potential veto from President Joe Biden, who said he planned on vetoing the bill after expressing concerns about investor protection and the stability of the broader financial system.

Should the President veto the bill, it would return to Congress where it would require a two-thirds majority in both houses to override the veto.

About the Author

Ibrahim Ajibade Ademolawa is a seasoned research analyst with a background in Commercial Banking and Web3 startups, specializing in DeFi and TradFi analysis. He holds a B.A. in Economics and is pursuing an MSc in Blockchain.

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