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Caitlin Long 🔑 Profile picture
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18 May, 4 tweets, 3 min read
NEW PIECE OF US REGULATORY PUZZLE: a paper criticizing @USOCC's change of longstanding rule last January, which paved way for #digitalasset custodians to get OCC trust bank charters. Today OCC said it's all under review. Sands are shifting in DC. @CSBSNews
papers.ssrn.com/sol3/papers.cf…
2/ Link to the paper was hard to see in the quote tweet, so here it is again: 🧐
papers.ssrn.com/sol3/papers.cf…
3/ ...but also just saw this too -- coincidence to release this statement on the same day as the @USOCC news??
4/ ...and for good measure, adding this to the thread -- it happened at the FDIC yesterday. More shifting sands in DC:
americanbanker.com/news/fdic-seek…

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More from @CaitlinLong_

Caitlin Long 🔑 Profile picture
20 May
1/ IT'S CLEAR a US #crypto regulatory crackdown is starting but I'm optimistic bc most of the major players/agencies have spoken already & the policy is taking shape: it's "pay taxes, comply w/ laws & don't take shortcuts, & we'll enable the innovation." It's NOT a "#bitcoin ban"
2/ A clear chronology:🧐
* Fed releases pymt system access guidelines (5/5)
* SEC warns abt #bitcoin futures (5/11)
* Binance IRS/DOJ story in Bloomberg (5/13)
* IRS article in WSJ=warning to pay taxes (5/14)
* FDIC ice thaws--it issues its first RFI (5/17)
...continued👇...
3/ ...continuing:
* OCC says reviewing all prior #crypto bank actions (5/18)
* Senate Banking Chairman warns OCC to clamp down on trust bank charters (5/19)
* Treasury Sec Yellen announces big IRS tax compliance push (5/20)
* Fed's Powell plans paper on payment innovation (5/20)
Read 6 tweets
Caitlin Long 🔑 Profile picture
15 May
1/ SOME THOUGHTS on #stablecoins & the #crypto selloff, which are probably connected.

HUGE news last week & it matters far more than @elonmusk or @binance news. A long thread 👇:
2/ First, #Tether finally disclosed how it invests reserves & it was a big negative surprise (not previously knowable at this level of detail). This news probably contributed a lot to #crypto selloff since Wednesday.
3/ Why? Because now risk managers at #crypto hedge funds almost certainly will require haircuts on #Tether, which means traders had to sell #crypto to reduce their total risk exposure.
Read 37 tweets
Caitlin Long 🔑 Profile picture
21 Apr
AND IT’S OFFICIAL!! 🤠#Wyoming will recognize #DAOs as a new type of LLC, effective July 1! Thank you legislators & @GovernorGordon for building on Wyoming’s history of inventing the LLC, which all other states followed roughly a decade later. We’re doing it again! A thread👇. 1/
What problem does #Wyoming’s #DAO law solve? It’s the prob of joint-&-several liability for all participants in a DAO, if the DAO were ever deemed by a court to be a general partnership 😱New law handles this by applying LLC liab protections to DAOs that meet the requirements. 2/
KEY is that, unlike regular LLCs, #Wyoming Secretary of State can yank the liability protection from a DAO that commits fraud or engages illegal activities (unlike with a regular LLC). So, only use this law for valid projects & get counsel—it won’t be useful for invalid ones. 3/
Read 7 tweets
Caitlin Long 🔑 Profile picture
26 Mar
1/ SOME THOUGHTS on the Texas #blockchain bills. Lots of good stuff here!! But Texans have more work to do. I hope sharing these thoughts helps you!

First, IT'S AWESOME that Texas is likely to become 2nd state to treat #bitcoin the same as money under US commercial law. 🚀💥🤠
2/ This is AWESOME & is LONG overdue. For lawyers out there Texas is proposing to apply the UCC "take free" rules, which means innocent purchasers of #bitcoin & other virtual currencies take free of any adverse claims as long as they didn't defraud the seller. THIS IS A BIG DEAL!
3/ It's same as the in-process proposal of @uniformlaws. Texas is jumping out ahead to adopt it early. I've been an observer of Uniform Law Commission process & it has made great strides to get to where it is--namely that #control of a virtual currency is the determining factor.
Read 16 tweets
Caitlin Long 🔑 Profile picture
2 Mar
1/ QUESTION for #DeFi experts--has anyone seen analysis of DeFi projects under Misesian distinction of **commodity credit** vs **circulation credit**?

Here's where I'm going: if all debt in the DeFi system is commodity credit, then system is solvent & yield is coming from vol.
2/ But if some debt in the system represents circulation credit, then system is fundamentally not solvent at the systemic level--so that at least some of the yield is coming from counterparty risk, & then the question becomes "how do you quantify the credit risk in the system?"
3/ In other words, yield can be broken into 2 components: risk-free nominal yield + a credit spread. If all debt in the #DeFi project is commodity credit, then system is solvent (ie, all debt backed by someone else's equity)--so in theory no credit spread (excl. operational risk)
Read 5 tweets
Caitlin Long 🔑 Profile picture
21 Feb
THIS PASSAGE in interview of James Grant by Kevin Duffy struck me given heartbreak in Texas. Interview predated Texas storms.

Commodity mkts have been booming generally, driven by tight supply

When demand spike hits tight supply, prices ⬆️. It’s not just happening in #bitcoin
BTW, the price of a gallon of gasoline is up about 20% since Jan 1 near me. Ouch. #inflation
“What matters to me...is speaking up...for the great institution of corporate solvency (you’d be surprised how controversial it can become at the end of a boom).-James Grant @mises

I agree—corporate solvency can go out window in bull mkts. Happens to #bitcoin intermediaries too
Read 4 tweets

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