Buy the Pump, Sell the Dump — Does Momentum Investing Work in Bitcoin?

Since the start of the year, Bitcoin (BTC) price has been as high as $9,200 — a 2-month high — while going as low as $6,900 on Jan. 3. Bitcoin’s volatility is one of the most frequently discussed issues that arise when investors evaluate Bitcoin as an asset class. However, its volatile behavior is what provides an opportunity for investors to take advantage of the price movements and make a profit. 

Following predictions as optimistic as the $100,000 forecast based on the stock-to-flow model, investors may foresee another period of high price speculation, opening the door for a wider set of investment strategies. 

On the other side, if investors end up experiencing a bearish scenario like the majority of 2018 and a portion of 2019, bolder strategies based on wide price movements may serve as a good alternative for market makers. 

Cryptocurrency market weekly overview. Source: Coin360

Strategies based on large price movements have been exploited for decades in traditional markets, especially in stocks. One of those strategies is momentum investing. An investor evaluates the daily returns for a sample of stocks and identifies which one was the biggest loser and winner in the price for that day. 

In traditional markets, it was found to be lucrative to buy the winner stock that day and hold it for a certain period (up to investor discretion) and sell (short) the loser stock. Usually, investors develop this strategy based on portfolios of best and worst-performing stocks instead of only choosing the best and worst performer from the chosen sample. 

However, it’s not uncommon for the individual momentum strategy to also be applied among investors despite raising questions about investment diversification. Nevertheless, if diversification is found to be ineffective in the crypto space, as reported by Cointelegraph, an investor might expect better results from an individual momentum strategy instead of focusing on portfolios. 

How does Momentum investing work in the crypto environment?

Firstly, we identify the top-20 cryptocurrencies in the market today and get the daily returns for each currency during 2019. Throughout a portion of last year, we have seen a bearish scenario in the market. However, Bitcoin picked up and ended the year with a cumulative return of 65%. 

By analyzing this strategy for a period with such characteristics, we can present a bolder strategy for investors to take advantage of bigger swings in smaller currencies since the biggest coins showed modest gains. 

Secondly, we identify which was the currency that had the highest (winners) and the lowest (losers) return from the top-20 currencies for each day in 2019. 

After identifying the daily winners and losers, we assume that an investor buys its closing price that day and sells it the following day, also at the closing price. The closing price (latest data in the range at UTC time given by Coin360) is assumed for simplicity purposes as it is open for investors to decide the desired time to buy and sell during those days. Another variation of the strategy can consist of holding the coin for more than one day. 

By employing this strategy every day in 2019, we find that an investor who buys the winners gets the best cumulative return of 140%. Whereas, an investor that buys the losers and sells them the following day retrieves a negative return for this period (-105%). In traditional markets, the strategy works in the same way with the investor buying the winners and sells the losers. 

Such volatile behavior leads us to also look at a risk-adjusted performance measure since an investor must be compensated by the exposure to higher risk investment. When exploring this strategy — buying the winners — a Sharpe ratio (the measure of risk-adjusted return of a financial portfolio) of 1.11 is achieved, excluding transaction costs, which is an acceptable performance for the strategy. 

January 2019-December 2019 momentum strategies (Buying Winners & Buying Losers) cumulative returns

As we would expect, lower market-capped coins appear more often as the best or worst performing currency in the market: Chainlink (LINK), Tezos (XTZ) and Cosmos (ATOM). 

The same currencies appear in both scenarios much more often than with other currencies. As we would expect, the higher market capped coins appear less frequently as the highest/worst performers (e.g. BTC, ETH, LTC, XRP).

Currencies with most appearances as best and worst-performing currency during the sample period

Key factors in a crypto momentum strategy

Looking forward, an investor delving into these types of strategies should be aware of certain factors. The first is that we looked at the top-20 currencies in the market today and examined their returns for the last year. 

Hence, some of the coins analyzed may not have been in the top-20 during some periods of 2019 as some may have just been recently launched or their volatility dislodged them from the sample. At the same time, currencies with volatile price swings may be included in some periods, raising the risk of the strategy but also the possible gains.

Another factor is the liquidity risk of employing such a strategy. When a lower market-capped coin sees a significant gain in price, it may be harder to buy it during a 24-hour period as most holders might expect the coin to go even higher or set very high sell limits for new investors to take advantage of this opportunity. 

Finally, a strategy that is based on daily trading will incur high transaction costs. In this example, we exclude these expenses from the cumulative returns and Sharpe ratio calculations, which will cause a decrease in performance after computing the impact of operational costs.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Cointelegraph News

LocalBitcoins Quietly Suspends Accounts in Multiple Regions Without Notice

Popular Bitcoin (BTC) exchange platform LocalBitcoins is allegedly suspending user accounts with little fanfare, citing an “enhanced due diligence process.”

Finland-based LocalBitcoins, one of major global peer-to-peer (P2P) crypto exchanges, has reportedly suspended user accounts in some countries in Africa, the Middle East and Asia without warning, with some users being unable to withdraw their Bitcoin, Forbes reports Jan. 25.

LocalBitcoins gives no public statement on the matter while the first reports came about a week ago

According to the report, the first complaints started coming in last week, with LocalBitcoins users in countries like Afghanistan, Iraq, Nigeria, Syria, and Pakistan claiming that they were not able to withdraw their Bitcoins without deleting their accounts.

As LocalBitcoins has made no official announcement on the matter, Cointelegraph has asked the company to provide a comment but did not receive an immediate response. This story will be updated should they respond. Meanwhile, LocalBitcoins tweeted on Jan. 28 that they have some planned website maintenance work, which reportedly lasted for one hour.

Apparent connection with European Union’s new AML law 

Following the suspensions, one of the alleged affected users of LocalBitcoins suggested on Reddit that the action must be connected with the European Union’s new Anti-Money Laundering (AML) law, which is known as 5th Anti-Money Laundering Directive (5AMLD). In a Jan. 28 post on Reddit, the user claims that new accounts users are not able to send Bitcoin that they received in their wallets, while customer support is not responding “at all.”

In a separate Jan. 22 personal blog post, the Redditor reported the issue in detail, noting that those users who got their LocalBitcoins accounts suspended were shown the following message:

“Customers residing or otherwise located in the following countries are required to have an enhanced due diligence process. The countries are defined by EU commission: Afghanistan, American Samoa, The Bahamas, Botswana, Democratic People’s Republic of Korea, Ethiopia, Ghana, Guam, Iraq, Libya, Nigeria, Pakistan, Panama, Puerto Rico, Samoa, Saudi Arabia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, US Virgin Islands, Yemen.”

LocalBitcoins users have to wait for 14 days to get access to their BTC

Other Redditors reported that the affected LocalBitcoins users will have to wait for at least 14 days to delete their accounts in order to withdraw their Bitcoin. One Redditor purportedly had to request the deletion of his account in order to get access to his crypto, noting that he was likely to have been affected by the new unannounced policy by LocalBitcoins:

“It’s really sad to see that even though I have a fully verified Tier 2 status, my account has been put on a forced holiday probably because I am in one of the targeted countries. […] I really hope I do get my bitcoins back after 14 days. I have submitted an account deletion request and received a confirmation email from your support team.”

Some affected users claim that their accounts were banned for no reason

Another Redditor, who claims to represent a crypto-related business in Lebanon, reported that LocalBitcoins suspended his account without sending any email before blocking the account. Nader Dirany, a co-founder of the local crypto business, complained that the account suspension has led to termination of his whole business despite him having set up the account almost 3 years ago as well as verified his account with the passport.

Meanwhile, Bitcoin is becoming more and more important in Lebanon amid the intensifying economic crisis in the country, Dirany said in an email to Cointelegraph. He considered LocalBitcoins’ (LBC) decision to suspend his account unfair:

“Sincerely I consider the LBC’s decision is unfair and unjustified, and a catastrophe on my business; especially that I resigned on September-2019 from my position as “Principal Consultant” in Utilities & Energy as to focus on having an online business in Cryptocurrency where LBC platform is considered one of its main pillars.”

LocalBitcoins trading volumes dropped over 50% from June 2019 to early January 2020

Founded in 2012, LocalBitcoins has emerged as one of the most popular Bitcoin exchanges for allowing safe P2P transactions with directly between the retailer and the customer and without involvement by any third party. However, the popular exchange started seeing a notable drop in trading volumes after the exchange abruptly terminated the option for users to perform local cash trades in June 2019. As LocalBitcoins continued to tighten its AML policies in 2019, its global Bitcoin trading volumes have been gradually dropping to touch a multi-year low in early 2020. According to data from Bitcoin statistics website Coin Dance, global Bitcoin trading volumes on LocalBitcoins dropped more than 50% since September 2019 by early January 2020.

Global weekly LocalBitcoins volume

Global weekly LocalBitcoins volume. Source: Coin Dance

LocalBitcoins’ proprietary AML and Know Your Customer policies are not the only reason for the massive decline of BTC trading on the platform. On Jan. 10, the European Union’s AML law 5AMLD officially came into force, forcing some companies to cease or relocate operations before the beginning of 2020.

In an interview in November 2019, LocalBitcoins CEO Sebastian Sonntag said that he expected that the KYC situation would become more stable “in the following weeks,” projecting that “improvements in the verification flow should also influence positively.”

Cointelegraph News

UK High Court Orders Freeze on $1M of Bitcoin in Ransomware Case

A United Kingdom High Court ordered a proprietary injunction on Bitcoin (BTC) obtained through a ransomware attack on a Canadian insurance company. A proprietary injunction is an order which prevents a person from dealing with their own assets when it is subject of a proprietary claim.

On Jan. 17, the UK High Court released documents concerning a ransomware attack, in which over 1,000 computers of the insurance company were rendered unusable through the use of malware that encrypted files, making them unaccessible. The unidentified attackers demanded $1.2 million in Bitcoin in exchange for decrypting the data.

The firm’s insurer covered the client’s losses from cybercrime and agreed with the hackers to pay $950,000 in Bitcoin to decrypt the files, and received a tool to unlock them 24 hours after making the payment.

Still, the company needed 10 days to restore all of its systems, including 20 servers and 1,000 desktop computers.

Bitfinex asked to hand over account data

The company’s insurer hired blockchain major analytics firm Chainalysis to track the ransom. The analysis revealed that most of the Bitcoin, 96 BTC had been immediately laundered through crypto exchange Bitfinex. The court required Bitfinex to provide any information concerning the holder of the account that received the ransom by Dec. 18, 2019.

When Cointelegraph contacted Bitfinex, the firm did not clarify the status of the ransomers’ Bitcoin or what data was handed over to the court, stating:

“Bitfinex has robust systems in place to allow it to assist law enforcement authorities and litigants in cases such as this. In this case we have assisted the Claimant to trace the stolen Bitcoin and we understand the focus of the Claimant’s attention is no longer on the Bitfinex platform. It now appears Bitfinex is an entirely innocent party mixed up in this wrongdoing.”

According to a Jan. 25 report from New Money Review, the case is still ongoing. Darragh Connell, the insurance company’s legal representative, said, “Return hearings of the interim injunction will be heard again in due course before Mr Justice Bryan who has reserved the case to himself […] As this is only the interim stage, my client’s claim will need be determined after a trial in the Commercial Court in London.”

Ransomware attacks are a major cybersecurity threat and are becoming increasingly advanced. As Cointelegraph reported in early December 2019, Texas-based data center provider CyrusOne paid a $600,000 ransom in BTC in such an attack.

In June 2019, hackers managed to infect the systems of the city council of Riviera Beach with ransomware and encrypt government files. Florida agreed to pay $600,000 worth of Bitcoin to the hackers.

Cointelegraph News

Draft of India’s National DLT Strategy Calls for State-Run Digital Rupee

A draft of India’s national strategy on blockchain and distributed ledger technology suggests a central bank digital currency (CBDC), the digital Indian rupee, and a national blockchain.

The National Institute for Smart Governance (NISG), a non-profit public body incorporated by the government of India, has published a draft document on the country’s national blockchain strategy. Issued on Dec. 30, the document appears to have been published recently as major local publications such as The Economic Times of India reported on the draft strategy on Jan. 28.

Digital rupee should be issued on a national blockchain of India

In the document, the NISG has proposed the Central Bank Digital Rupee (CBDR), a digital currency issued on a national permissioned blockchain. NISG  “strongly recommended” that the CBDR be issued by India’s government and the country’s central bank, the Reserve Bank of India. The document reads:

“As an alternative to Public Blockchains that operate with native cryptocurrency, like Ethereum, it is strongly recommended that Government of India along with RBI come out with a Central Bank Digital INR (CBDR) administered over a Public Permissioned Blockchain that processes transactions through a Turing Complete Virtual Machine allowing decentralized applications to run on its platform.”

Light touch regulatory approach is needed to address an existing lack of clarity

The NISG also outlined the existing legal challenges for the industry in India associated with lack of regulatory clarity. As such, the body urged Indian authorities to develop and promote regulatory clarity in the industry by publishing official statements instead of making public statements:

“Public statements, whether through the press or formal speeches, are helpful but are not official statements of application by the agency. If an agency intends to enforce its laws in new and innovative ways, it must first notify industry stakeholders of its intent to do so and the way in which existing law applies.”

Additionally, the company recommended adopting a “light touch regulatory approach” at the initial stages of the blockchain industry’s development in India. According to the NISG, existing regulation in India is “too restrictive” and does not take into account the potential of emerging technologies.

India’s central bank said it hasn’t banned crypto

The news comes a few days after the central bank of India said that virtual currencies are not banned in the country, elaborating that instead, regulated entities are banned from offering crypto assets in the country. As reported, the RBI banned Indian banks from providing crypto-related services in the country in 2018.

The RBI made its statement amid ongoing court hearings against the central bank at the Indian Supreme Court, as an consortium of crypto firms and experts attempts to have the ban repealed.

Source Cointelegraph

BTC Price Back at $9,000 But No, Coronavirus Isn’t ‘Good for Bitcoin’

Bitcoin (BTC) may be gaining thanks to “economic fear” over coronavirus — but only up to a point, analysts are concluding as the disease spreads. 

The cryptocurrency hovered at around $9,000 on Tuesday, capping 4% gains for the week in which coronavirus sent China into partial lockdown. 

Coronavirus uncertainty creeps into markets

Fears are now surfacing about the impact on Chinese economic growth, while global signals also suggest investors are more cautious about the short term. 

For Cointelegraph Markets analyst Mati Greenspan, the sentiment is already palpable. Uploading a chart of United States bond yields, he noted one-month performance delivered higher returns than the longer seven-year options.

“It means investors are expecting trouble in the short term,” he explained in comments. 

Such economic uncertainty and unease on markets have often sparked increased bullish action for Bitcoin. As Cointelegraph noted, the Iran crisis earlier this month was just the latest geopolitical event that appeared to buoy the Bitcoin price.

While Greenspan noted Bitcoin remained a highly non-correlated asset, mainstream media claims that Bitcoin was defying traditional markets and gaining purely on the back of coronavirus were widely panned. 

A report by the Financial Times with the headline “Coronavirus is good for Bitcoin” came in for particular criticism. Notably, the report cited two random Twitter accounts dedicated to altcoin XRP as sources.

As Cointelegraph reported, Bitcoin has long exhibited increasingly strong technical fundamentals, which preceded recent price moves. 

Vays: virus would “hurt” BTC in epidemic scenario

Discussing the impact of coronavirus, trader Tone Vays nonetheless stopped short of agreeing with the idea that the disease could perpetually fuel further gains. 

If it were to spread internationally, for example, panicked investors would likely reduce speculative activity, meaning less interest in non-traditional assets such as Bitcoin. 

On the latest episode of his Trading Bitcoin YouTube series, Vays told viewers:

“The coronavirus does bring some economic fear, so the fear that the coronavirus could start to spread is certainly helping the rise of Bitcoin versus hurting the rise of Bitcoin.”

Vays also noted that Bitcoin would need to stay above $9,000 for several days to cement its recent bullish gains.

Google search data for “coronavirus” and “Bitcoin”

Google search data for “coronavirus” and “Bitcoin.” Source: Google Trends

Meanwhile, data from Google Trends appears to underscore the lack of correlation between the crisis and Bitcoin, with search interest in the latter remaining comparatively flat throughout the past month.

Cointelegraph News

Bitcoin Must Hold $9K for 2-3 Days to Secure Bull Market

Bitcoin (BTC) rising above $9,000 has turned heads amid fresh uncertainty in China but has yet to convince one of its best-known traders.

In the latest episode of his Trading Bitcoin YouTube series on Jan. 28, Tone Vays said that despite the past week’s upward price momentum, he was not yet bullish on Bitcoin. 

Vays: BTC has not confirmed the bull market 

“Am I ready to declare a bull market? No,” he summarized. 

Famously cautious about overly enthusiastic price forecasts, Vays previously warned markets were giving mixed signals and that BTC/USD could dip lower. At the time, in mid-January, the pair traded at around $8,100. 

Suggesting downside at the time was the BitMEX funding rate, an indicator which Vays noted generally runs contrary to others but has a high degree of accuracy. 

Now, as then, the funding rate is “favoring the bears,” he continued, but not to the extent it once did. 

Nonetheless, Vays concluded that levels above $9,000 — and the 200-day moving average — need to hold for several days in order to convince him of a bullish trend. 

“If we fall back below the 200-day moving average, then the double top holds,” he said, referring to Bitcoin’s previous trip above $9,000 around Jan. 17.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

Binance CEO demands bear shakeout

Not everyone shared the sentiment of fragility. In a tweet on Tuesday, Changpeng Zhao, CEO of crypto exchange Binance, even urged followers to shun price forecasters who predicted lower levels than at present for BTC/USD.

Zhao wrote: 

“Now is the time to unfollow people who predicted btc to 5000 in the last couple months, and btc to 1000 a year ago.” 

While that should ostensibly include Vays, his perspective echoes traders and analysts who likewise told Cointelegraph that those waiting to buy in at lower levels had already missed their chance. 

Among them were veteran trader Peter Brandt, as well as EzeeTrader partner Charlie Burton. 

Cointelegraph News

Gemini Europe Hires New Chief Compliance Officer for Europe Expansion

Gemini Europe — the United Kingdom and EU affiliate of the Winklevoss twins’ United States-based crypto exchange Gemini — has appointed a new chief compliance and money laundering reporting officer.

As part of the firm’s expansion into the transatlantic market, the new appointee, Blair Halliday, will oversee Gemini Europe’s compliance program in the region. 

A press release published on Jan. 28 revealed that Halliday will be based in London and report directly to Gemini’s managing director of the U.K. and Europe, the former Sterling Bank executive Julian Sawyer.

A career tackling financial crime

Halliday formerly served as chief compliance officer for crypto finance firm Circle across the Europe and the Middle East and Africa region, where he directed the firm’s global anti-money laundering compliance program.

Prior to this role, he served as executive director of financial crime and compliance at U.K. fintech CashFlows and as CCO at New York Stock Exchange owner International Currency Exchange.  

Before his move into fintech and digital assets, Halliday worked at the Royal Bank of Scotland for 14 years in various roles focused on tackling financial crime.

Rules and “thoughtful regulation”

The Winklevoss’ approach to compliance has in the past drawn some criticism from the more libertarian fringe of the community, as with their “Crypto Needs Rules” ad campaign in 2019, which made a strong bid to remold crypto’s image with an emphasis on robust regulation and compliance-driven market practices.

At the time, a senior Gemini executive said the form believed crypto investors “deserve the exact same protections” and standards as those in traditional markets.

In the platform’s recent stage of European and U.K. expansion, Cameron Winklevoss has continued to emphasize this agenda, writing in a blog post in December 2019 that:

“The concept of thoughtful regulation itself was first developed out of the lessons learned in these [E.U. and U.K.] markets over centuries. Our ethos — to ask permission, not forgiveness — was a first in the crypto industry and both honors and continues to build on Europe and the UK’s tradition of thoughtful regulation.”

Source Cointelegraph

Bitcoin Price Breaks Through Key Resistance as Traders Target $9.2K

Bitcoin daily price chart. Source: Coin360

Bitcoin (BTC) bulls appear to have found a second wind which allowed them to push the price above $9,000 to daily high at $9,150.  As discussed in an earlier analysis, bulls had been fighting to hold the price above $8,800 throughout the day and multiple attempts at knocking out the $9K mark were held back by $8,963 and $8,985. 

BTC USD 6-hour chart. Source: TradingView

Traders will now look for Bitcoin to sustain above $9,118.85 in order to flip the $9,100 to $9,200 zone to support and set a daily higher high. Above $9,200 traders will now look to $9,500, $9,600, $9,963 and $10,538 as the next targets for Bitcoin price. 

Since Jan. 24 Bitcoin has rallied 11.31%, meaning an eventual pullback could see the price revisit $8,900 and $8,700. At the time of writing the moving average convergence divergence (MACD is on the verge of crossing above the signal line on the daily time frame and the histogram is on the verge of shifting from negative to positive as it approaches 0. 

BTC USD daily chart. Source: TradingView

The relative strength index is also bullish with a reading of 66 but not yet overbought suggesting bulls could push the price higher. As mentioned previously, during strong rallies Bitcoin price can continue surging higher regardless of multiple indicators flashing overbought readings so traders are advised to keep a close eye on trading volume, the Chaikin Money Flow oscillator and also be wary if a double top candlestick pattern forms as this would be an early sign of a short term reversal. 

Bitcoin daily price chart. Source: Coin360

The overall cryptocurrency market cap now stands at $250.3 billion and Bitcoin’s dominance rate is 66.1%. A number of altcoins also mirrored Bitcoin’s gains. Cardano (ADA) rallied 8.05%, Bitcoin SV (BSV) has held on to an 8.54% gain and Litecoin (LTC) rallied 7.49%.

Keep track of top crypto markets in real time here

Cointelegraph News

Bitcoin Price Pushes Above $8.8K as Bulls Attempt to Reclaim $9,000

After a pleasant weekly close, Bitcoin (BTC) bulls turned up Monday prepared to push the price to the $9K mark and possibly above. Over the weekend numerous crypto analysts suggested that if the price sustained above the $8,650 resistance Bitcoin would rally to $8,800 to set a daily lower high, consolidate, then make another run at the $9,200 mark. 

Bitcoin daily price chart. Source: Coin360

All, except the latter, has come to pass and at the time of writing traders are attempting to push the price through 9,000 but $8,963 has been a sticking point. Purchasing volume continues to rise and the 6-hour timeframe shows the RSI pushing above 72 as bullish momentum continues to rise on the moving average convergence divergence (MACD) histogram. 

BTC USD 6-hour chart. Source: TradingView

Neither indicator is in overbought territory and at the moment Chaikin Money Flow (CMF) oscillator has flipped positive above 0 and continues to rise, demonstrating that bulls are continuing to pump funds into Bitcoin. 

Experienced traders will recall that when volume sustains throughout a strong upside move, oscillators like the Stoch, RSI, and MACD can become overbought and hold these positions as Bitcoin’s price continues to surge higher. Thus, incorporating other indicators like moving averages, candlestick patterns, and the Bollinger Bands can provide additional valuable insight. 

BTC USD daily chart. Source: TradingView

The daily chart shows Bitcoin en-route to setting a new daily higher high slightly above $9,200 and this point also aligns with the upper arm of the Bollinger band indicator. If bulls are successful in pushing the price above $9,230, traders will set $9,500 as the next destination for Bitcoin price.

Above $9,500, $9,600, $9,963 and $10,538 are the next areas that traders will reach for. Looking at Bitcoin’s longer-term market structure on the daily chart, one can see that $9,119.85 is an important level to sustain above. Since July 16, 2019, this level functioned as strong support so if bulls are able to flip this resistance to support it would solidify Bitcoin’s trend reversal and significantly reduce the likelihood that the price will drop below $8,000 in the near future. 

$9,119 is also close to the 36.2% Fibonacci retracement level from Bitcon’s June 26 drop from $13,800. Some traders view this Fib level as being nearly as significant as the 61.8% level and the daily chart shows this Bitocin frequently bounced off this level as support for 6 months before dropping below it in September 2019 thus flipping it to resistance. 

Over the coming days bulls will fantasize about Bitcoin sustaining above $9,119.85, then pushing its way through the 38.2% Fibonacci retracement at $9,250 as this would set the digital asset up for a well-measured shot at $10,000.  

Bitcoin daily price chart. Source: Coin360

The overall cryptocurrency market cap now stands at $245.8 billion and Bitcoin’s dominance rate is 65.9%. As Bitcoin rallied 4.26% a number of the top-20 altcoins followed suit with impressive gains. Bitcoin SV (BSV) rallied 11.32% while EOS and Ethereum Classic (ETC) gained 9.41% and 15.3% respectively.

Keep track of top crypto markets in real time here

Cointelegraph News

Former Bakkt CEO and Current Senator Loeffler Delays Disclosing Assets

The clock is ticking on former Bakkt CEO senator Kelly Loeffler’s Financial Disclosure Report, with ethics watchdogs on guard. 

Senator files extension

Loeffler filed an extension that would give her until May 5 to submit her Financial Disclosure Report. The report, which all officials are required to submit, airs potential conflicts of interest by identifying asset holdings. In the case of Loeffler, these are presumed to be substantial.

Craig Holman, an ethics lobbyist at Public Citizen, told Cointelegraph, “Extensions on filing are not uncommon. The purpose really is just transparency, obviously, of one’s potential conflicts of interest.”

Following her Jan. 8 senate appointment, the Republican from Georgia was then appointed to the Senate Agriculture Committee, giving obvious grist to ethics analysts. The committee oversees the body — the Commodity Futures Trading Commission (CFTC) — that oversees her husband’s company — Intercontinental Exchange (ICE).

As a voting member of the committee, Loeffler, who raised eyebrows with her appointment last month, will vote on issues and appointments that affect the reported $600 million personal fortune of her husband, Jeffrey Sprecher, CEO of ICE, the company that owns Bitcoin options contracts regulator Bakkt.

The Agriculture Committee oversees the CFTC, which monitors ICE, which owns the New York Stock Exchange. As a member, Loeffler would consequently be at risk of casting conflicting votes on commissioners of and appointments to the CFTC.

“I’m not aware of any upcoming votes,” said Holman, “although there very likely are votes that directly affect her and her husband’s wealth. I mean, she’s treading right into the middle of one big conflict of interest.”

Failure to file a Financial Disclosure Report risks both civil and financial penalties.

Resolution of conflict

Some ethics analysts consider rules of ethical oversight to have been defanged. Senators don’t need to divest from conflicting assets, nor must they place them in a blind trust, a move that would ease ethical concerns.

“She could avoid all of those problems by putting her money in a blind trust, and that would largely resolve the issue,” said Holman.

Presented as an outsider when appointed, Loeffler and her husband have donated a reported $3.2 million to political candidates, mostly Republicans. She also pledged $20 million of her own money to her campaign in November.

Cointelegraph News