Going to war is about as American as the Fourth of July. I mean, we’re very good at it. We’re also very good at declaring wars on vague things like drugs and terror. 🇺🇸

So now as crypto recovers from a volatile 2022 and the SEC launches lawsuit after lawsuit against crypto firms, we can’t help but wonder: Is the US declaring war on crypto?

We’re going to take this newsletter to broach some wartime peace talks and get to the bottom of the American crypto conflict.

Espresso Shots

☕️ NFT.com Enters Public Beta 💻 🌎

NFT.com, a new NFT marketplace with an impressive domain, has launched its public beta.

NFT.com is also announcing an Amazon-Prime like membership to individuals who join the platform and mint a custom NFT.com/You profile (think: NFT.com/Coffee.)

Profile holders then get access to discounted fees, exclusive features, and an NFT.com social profile that can be used to display NFTs.

What sets NFT.com apart from other marketplaces is its aggregation. Users can seamlessly buy and sell across NFT.com, OpenSea, Looksrare, and X2Y2 all at once.

NFT.com is one of several portfolio companies owned by Immutable Holdings, founded by Jordan Fried. Other businesses and brands owned by Immutable Holdings include Immutable Asset Management, 1-800-Bitcoin, and Coffee and Crypto.

That’s right. This Coffee and Crypto. But we gladly support our corporate overlords and cover this development of our own free will.

Pay no attention to the puppet strings on our elbows and hands as we type this section.

☕️ SEC vs. Do Kwon ⚖️ 🥊

The SEC is suing Terraform Labs and co-founder Do Kwon for misleading investors in the lead up to the collapse of Terra.

The suit is formally charging Do Kwo and Terra Labs with fraud, selling unregistered securities, and selling unregistered security-based currency swaps.

The collapse of Terra, of course, led to a wave of bankruptcies in the crypto sphere.

Gurbir Grewal, the SEC’s Director of Enforcement, issued a press release stating that Terraform Labs, “was neither decentralized, nor finance.” Ouch.

Though, the most difficult aspect of this case, is the fact that Do Kwon is still famously on the run and his whereabouts are unknown.

Though some say you can still hear Do Kwon’s voice on the wind, giggling and cackling, “If you want to sue me, you’ll have to catch me first!”

☕️ The Return of Napster 🎧 🎶

Napster Ventures, the revived entity of once-music-download-giant, Napster, has acquired Mint Songs, a song-building tool for Web3 musicians.

Mint Song co-founder, Garrett Hughes, will be brought on to Napster as an advisor and he’s incredibly enthusiastic about the deal’s potential:

“As we looked for a partner that could take what we’ve built over the last two years and give artists a true marketplace for their assets where millions of fans are already active,” 

Hughes continued: “It became abundantly clear that Jon and Napster have the vision to finally take Web3 music to the mainstream.”

As exciting as this deal may be, it’s made even more exciting by the fact that Limewire, another popular music download giant, beat them to it.

Yep, that’s right. Limewire is a music-related NFT marketplace now. I guess it's good to know that after we die we'll all come back as web3 shells of our former selves.

Spilling the Beans

America's War on Crypto

Even if you haven’t been paying close attention to the news, you may have noticed that the United States hasn’t been too friendly to crypto recently.

Things reached a boiling point last week with Payward Ventures.

Payward Ventures and Payward Trading Ltd., are two crypto companies that are usually referred to by their much better known alter ego, Kraken.

The Securities and Exchange Commision (The SEC) charged Kraken a $30 million fine for selling unregistered securities and forced Kraken to shut down it's staking as a service program.

And of course, the severity of this public statement against crypto affected the market accordingly. Coinbase, which operates a staking program as well was quick to get ahead of it.

Crypto stocks dropped across the board, many posting their first losses of 2023 after what had been a remarkably rosy market.

But the SEC wasn't done with us there. Oh no.

The SEC now intends to sue Paxos, a crypto firm, for violating investor protection laws.

The issue at the center of that suit is that Paxos issues and maintains Binance USD (BUSD) a US dollar backed stablecoin. The SEC now believes this is an unregistered security.

This ongoing conflict between American regulators and the notion that cryptocurrencies are unregistered securities is nothing new.

Though we’re a country that heralds ourselves as a melting pot, always ready for new inventions and big ideas, the reality is: our laws are nowhere near ready for crypto.

America doesn’t like new ideas when they threaten the existing infrastructure of the old ideas and very old laws.

Staking isn’t an unregistered security, staking programs aren't even a security at all.

Meanwhile, collateralized stablecoins like BUSD are also not securities. They're stablecoins, they're an entirely new concept without any laws to regulate them.

All of this has unfortunately left us in a situation where we have a congress that's not great at passing laws, and an SEC that's decided to take on crypto using the courts.

It's hardly an ideal situation. While it's easy to point figures at the SEC and it's delightfully charming head, Gary Gensler, he's also got a near impossible job.

Gensler is the head of the United States' lead financial regulatory industry, and our country has no clear regulatory guidelines surrounding crypto.

And admittedly none of these actions are coming completely out of the blue.

Just last January, the Biden White House published a post entitled, “The Administration’s Roadmap to Mitigate Cryptocurrencies’ Risks.”

And here they go mitigating them!

The SEC is trying their best, really. But like an out of touch parent, they just don’t quite get it.

But while a parent might make misguided judgements out of a place of love, the SEC likely isn't acting out of love. Ultimately, the SEC and crypto are diametrically opposed.

Why? Because decentralized finance wouldn’t need to exist without the failures of centralized finance.

Roughly 4.5% of Americans are unbanked, meaning that they have no checkings or savings account. 42% of Americans were denied a loan in the past year alone.

So, no, American banking and centralized finance isn’t for everyone.

And it’s certainly against the big banks and the current American infrastructure if American citizens begin flocking away from Chase, BofA, and M&T and toward decentralized finance.

The SEC have started quite a few battles, but the war is only beginning.

And if you need us, we’ll be cowering in a fox hole. Because like most writers, we’re cowards.

Meme of the Day

Honestly, the resemblance is uncanny.

Crypto 101

Hello class, today we're revisiting the all important term "staking" but we've decided to do something a little differently this time.

For this installment of Crypto 101, we’re going to have a guest lecturer. Gary Gensler, aka vitamin-deficient Jeff Bezos, to teach you a little something about Staking. Enjoy!

https://www.sec.gov/news/sec-videos/office-hours-gary-gensler-staking-a-service

The Last Sip

Just in case you thought we were at peace, here’s a quick list of America’s ongoing, metaphorical war:

• The War on Drugs

• The War on Hunger

• Former New York City Mayor Michale Bloomberg’s One Man War on Sodas Larger than Sixteen Ounces

Stay Caffeinated,

Coffee & Crypto Team

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.