As Masa Son, Anthony Scaramucci, the people behind TikTok and probably you, as well, have noticed, there’s some serious shit going on in China. There’s continuing pressure on the country’s biggest companies. There are the arrests. There’s the ongoing trade war. There’s the whole Evergrande meltdown, which may not be another Lehman Brothers and which may have been totally predictable and which may be in some measure the accountants’ fault, but which is certainly bad all the same.

Oh, also, as noted China knower Ray Dalio predicted, they’re putting a stop to all this crypto nonsense once and for all.

In a Q&A posted to its website, the People’s Bank of China said services offering trading, order matching, token issuance and derivatives for virtual currencies are strictly prohibited. Overseas crypto exchanges providing services in mainland China are also illegal, the PBOC said…. Workers at foreign crypto exchanges will be investigated, it added.

On this side of the world, the we’re going with a more nuanced approach toward the apparently illegal, at least until Gary Gensler and Saule Omarova really get involved.

Treasury Department officials also want assurances that the stablecoin firms have the technical capacity to handle big surges in transactions, so that they do not set off a chain reaction of trouble if large numbers of customers try to cash out their holdings…. The rules, they said, will likely mandate that reserves are always liquid enough to meet redemption demands, and that the software systems handling these transactions are robust enough to avoid crashes and severe slowdowns when facing mass simultaneous transactions…. Another option would be to create some kind of new type of banking charter for stablecoin issuers that addresses many of the regulatory concerns.

The Securities and Exchange Commission also could use its powers to demand that certain stablecoin issuers with reserves backed by securities — such as commercial paper, bonds or money market funds — register as securities, which would require companies to provide more disclosures to investors.

None of which seems to have done much to cool the craze for cryptos.

Grayscale Investments, which calls itself the world’s largest digital-currency asset manager, launched a fund two months ago that invests in tokens tied to crypto-trading platforms including Uniswap and SushiSwap. Wealthier U.S. investors are eligible to buy the Grayscale Decentralized Finance (DeFi) Fund’s shares, which don’t freely trade now but could in the future, according to the company…. The Securities and Exchange Commission is investigating the startup behind Uniswap…. Grayscale earlier this year dissolved a fund created to invest in the cryptocurrency XRP and returned cash to investors after the SEC sued the company behind that digital asset.

“The fact that in crypto people are still charging commissions on trading fees, that’s insane,” Christine Brown, chief operating officer of Robinhood’s crypto business, said on stage at the Mainnet crypto conference in Manhattan on Wednesday. Indeed, many crypto exchanges, like Coinbase, Binance, Gemini, and Kraken, do charge fees, usually a percent of the amount to be purchased.

Yup, that's what's insane, Christine. Anyway, if all of that scares you for some reason, there are always other fun and exciting way to lose money out there.

This month, American guitar maker Gibson said it would use Rally, a site specializing in collectibles, to issue shares in prototype instruments designed in collaboration with famous players…. Investors may get fooled again: Hot pandemic money has taken vintage-instrument prices close to the previous peak, dealers say. And, in a way reminiscent of pre-2008 subprime mortgages becoming triple-A-rated, the “vintage” label has expanded to include the notoriously shoddy guitars made in the 1970s.

China’s central bank says all cryptocurrency-related activities are illegal, vows harsh crackdown [CNBC]
Regulators Racing Toward First Major Rules on Cryptocurrency [NYT]
Crypto Funds Trade in Coins That Are Under SEC Scrutiny [WSJ]
Will Robinhood force crypto trading to go ‘no-fee’? [Fortune]
Buying a Share of a Collectible Guitar? In This Market, You May Get Shredded. [WSJ]
Alibaba, Under Beijing Pressure, Moves to Sell Stake in State-Owned Broadcaster [WSJ]
HNA Group's chairman and CEO taken by police in China [CNN]
Commerce Secretary Gina Raimondo Aims to Strengthen Business Ties With China [WSJ]
The Evergrande-Lehman analogy is wrong [Yahoo! News]
Evergrande’s crisis was ‘a long time coming,’ says banned short-seller Andrew Left [CNBC]
China Evergrande Auditor Gave Clean Bill of Health Despite Debt [WSJ]
Evergrande’s Global Bondholders Didn’t Receive Interest Payment [WSJ]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

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