CryptoSlate Wrapped Daily: Celsius to repay users; SEC may apply custody rules to crypto CryptoSlate Wrapped Daily: Celsius to repay users; SEC may apply custody rules to crypto
The bankrupt lending firm Celsius has announced that is preparing to repay certain users. Meanwhile, the SEC has said that it could expand federal custody rules to cryptocurrency. These and other stories in today's edition of Crypto Slate Wrapped.
4 min read
Updated: Aug. 4, 2023 at 3:22 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The biggest news in the cryptoverse for Feb. 15 saw Celsius announce that it plans to begin paying back eligible users. Elsewhere, the SEC has proposed expanding federal custody rules to the crypto sector. Plus, Charles Hoskinson on staking regulation, and finally, someone has uploaded a recording of a fart onto Bitcoin’s Ordinal Network.
CryptoSlate Top Stories
Celsius prepares to reopen partial withdrawals for eligible users
Bankrupt crypto lender Celsius will be notifying eligible users about how they can start withdrawing assets in certain custody accounts, the firm announced on Feb. 15.
Celsius included the list of eligible users in its distribution schedule and will send emails and in-app notifications for the next steps, according to the announcement. However, Celsius has not yet set a date for when it will reopen withdrawals. The withdrawals will be restarted only for U.S.-based customers while international users have to await further court instructions.
SEC suggests including crypto into federal custody rules
The US Securities and Exchange Commission (SEC)’s chairman Gary Gensler proposed expanding federal custody requirements to include crypto, according to CNBC News.
The expansion will require crypto exchanges to go under heavier registration processes to be considered a custodian and separate their users’ assets from the company holdings, CNBC reported.
Gensler stated: “Our securities law says that you need to properly segregate customer funds. You also shouldn’t be running a broker-dealer or a hedge fund and an exchange. The New York stock exchange doesn’t also have a hedge fund on the side and trade against their customers.”
Currently, federal custody regulations include assets like funds or securities held by investment advisers. According to the current setting, investment advisers must hold the securities and funds that belong to their customers at a federal or state-chartered bank.
Hoskinson: SEC had justified concerns about Kraken staking
Input Output (IO) CEO Charles Hoskinson argued that the SEC was right to go after Kraken over its Staking Program.
During a live stream broadcast on Feb. 14, Hoskinson spoke in detail about the SEC-Kraken enforcement action. Informing his comments was the actual complaint filed by the regulator with the District Court.
Based on his interpretation of the document, he understood that the regulator has no problem with staking. However, this is not the case for in-house exchange staking programs.
FTX reportedly in talks to recoup $400M investment in Modulo Capital
FTX management led by John Ray III is reportedly in talks with Modulo Capital founders to reclaim about $400 million that Sam Bankman-Fried invested in the hedge fund, New York Times reports.
Modulo Capital is a Bahamas-based hedge fund launched by former Jane Street traders Xiaoyun Zhang and Duncan Rheingans-Yoo. SBF reportedly invested about $400 million shortly before his empire collapsed.
Following FTX’s bankruptcy in November 2022, SBF’s investment in Modulo Capital was converted into cash and kept in an interest-bearing account at JPMorgan, sources close to the firm confirmed to NYT.
SBF bond signers revealed to be former Stanford faculty; FTX bankruptcy judge rules against probe
Two notable developments concerning the bankrupt crypto firm FTX and its former CEO, Sam Bankman-Fried, occurred in court on Feb. 15.
Previously, Judge Lewis Kaplan allowed two individuals who signed Sam Bankman-Fried’s bail bonds to be publicly identified during his criminal trial.
Court documents today revealed that those bond signers (or sureties) were a Stanford University senior research scientist and a former Stanford Law dean who signed a $200,000 bond and a $500,000 bond, respectively.
In FTX’s separate bankruptcy proceedings, a judge ruled that an additional independent probe is not necessary and denied a motion to appoint an independent examiner.
PUSH jumps 41% as Push Protocol (EPNS) launches on BNB chain
Push Protocol (formerly EPNS,) the blockchain messaging and communications protocol, launched on BNB Chain on Feb. 15, as its PUSH token jumped 41% over the past 24 hours.
The goal is to “expand its reach and appeal across an ever-diverse list of ecosystems” following its prior launches on Ethereum and Polygon. “Launching on BNB Chain helps Push to get closer to its vision of onboarding one billion users to web3,” said Harsh Rajat, project lead and founder of Push Protocol.
Access Protocol to go live Feb. 15 with ACS airdrop for CoinGecko Candies
Access Protocol, the digital content monetization platform — adopted by crypto content platforms such as The Block, CoinGecko, CryptoBriefing, and CryptoSlate — is set to go live on Feb. 15.
Following a community AMA on Twitter, the project will launch on the Solana blockchain with listings on MEXC, Gate.io, Coinbase, and ByBit at 5 PM UTC on Feb. 15 for the native ACS token.
At launch, the ACS will have its inflation set to 2% and “slowly scaled to 5% over the coming months.” In the future, the community will manage the inflation level, according to the launch Medium article.
Someone uploaded a fart to Bitcoin Ordinal network and apparently sold it for $280k
A new Ordinal minted on the Bitcoin blockchain network, inscription 2042, consists of a one-second audio clip capturing the sound of a wet fart.
Launched in January by software engineer Casey Rodarmor, Ordinals are essentially a protocol that allows for data to be stored on Bitcoin’s blockchain network. Think NFTs but for Bitcoin.
They’re so new you can’t even buy them via a marketplace like OpenSea. They require special Bitcoin Ordinal wallets to store and trade, but this has not stopped people from uploading strange and uncanny files to the Bitcoin network.
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Author 
Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
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Celsius Network
Celsius Network is a bankrupt cryptocurrency lending company that was founded in 2017 and headquartered in Hoboken, New Jersey.
FTX
FTX is a defunct cryptocurrency exchange, currently in bankruptcy proceedings, that was founded by Sam Bankman-Fried and Zixiao “Gary” Wang in May 2019.
Charles Hoskinson, based in Colorado, stands out as a prominent figure in the blockchain and cryptocurrency sphere.
Gary Gensler is an American government official and former investment banker who President Joseph Biden nominated to chair the U.S.