Kristin Johnson, one of the newest commissioners of the Commodity Futures Trading Commission (CFTC), said that while her agency may be smaller than the Securities and Exchange Commission (SEC), she likes its chances of becoming a primary regulator for the crypto markets.

• "What I would suggest in response to arguments that the CFTC is the underdog in some jurisdictional fight is that I like being an underdog," Johnson said. She spoke during a panel discussion at Crypto Connection, a conference hosted by the TabbFORUM on Tuesday.

• "Yes, [the] CFTC is smaller" but that's why "we might be more capable of being responsive," she said, responding to a question about whether the CFTC or SEC should have greater regulatory authority over the crypto sector.

• Johnson is one of five commissioners on the CFTC, which is chaired by Rostin Behnam.

• U.S. senators Cynthia Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.) recently introduced a wide-reaching crypto legislation bill that many have seen as giving the CFTC greater regulatory oversight than the SEC. But that view has been rejected by Gillibrand.

• Gillibrand, speaking on CoinDesk TV's "First Mover" program last week, said the bill is "clarifying the roles" that the SEC and CFTC have in overseeing crypto, and that the bill sponsors had worked with SEC staff in creating the legislation.

Global crypto exchange Huobi can now offer its services in New Zealand after registering with that country's financial services provider register, according to an emailed statement on Friday.

• All exchanges have to register with the New Zealand Companies Office before offering services to local users, the statement said.

• Singapore-based Huobi has continued to expand its global footprint of late, most recently acquiring Latin American crypto exchange Bitex to boost its presence in that region. The company is also planning to return to the U.S.

AUSTIN, Texas — The collapse of Terra’s terraUSD (UST) made some investors think twice about buying stablecoins. The algorthmic stablecoin, pegged to the U.S. dollar, turned out to be less than stable, and investors in stablecoins as a whole were spooked about being left with nothing.

It’s the exact opposite way of thinking for Bermuda’s premier, David Burt. He said in an interview the Terra debacle highlights the importance of good regulation, vindicating his goal of making his country the world’s home for safe, innovative assets.

The recent dramatic loss of terraUSD’s dollar peg “is a validation of the approach that we've taken,” Burt told CoinDesk during the recent Consensus 2022 conference here.

“What Bermuda wants to be is the hub of the global stablecoin market, where it is issued under a regulated environment so investors and citizens can have confidence,” he said. “There are stablecoins, but then there are regulated stablecoins.”

He first told CoinDesk about his aims for crypto regulation during a "Money Reimagined" podcast in October 2020. Last week, it was announced that Bermuda had issued its first digital asset banking license to locally-based institution Jewel Bank, representing the first new bank license of any kind issued by Bermuda in 21 years.

It’s been a long wait, but Burt hopes people will take that as a sign of the nation's thoroughness and credibility and be confident the Bermuda Monetary Authority has done its homework to protect hard-earned savings.

“Our regulator has responsibility to ensure that in breaking this new ground [involving stablecoins] all the risk has been assessed,” he said. “That might take longer, but you will know that we go through an incredibly thorough process.”

Jewel

In addition to being a bank, Jewel plans to issue a U.S. dollar-linked stablecoin in the fall of this year for use in wholesale financial markets, potentially followed one pegged to the Bermudian dollar and then other currencies.

“Digital assets broadly are going to change the way in which the world operates,” Burt said. “We believe that is certainly going to be the future, and we want Bermuda to be the home of innovation.”

Jewel’s CEO agrees it’s not been an easy process – although Nick Lepetsos stressed that, as a bank-issued, fully reserved asset, its proposed stablecoin has a much more robust model than Terra’s algorithmic version.

Lepetsos told CoinDesk the procedure to secure Jewel's license included a grueling set of questions about the company’s expertise, capital and reason for existing – far from the cartoon view of “going to the DMV, the Department of Motor Vehicles, where you just sign up and get in line and you wait a while, and you get your license,” he said.

While long a major financial center, Bermuda’s a tiny territory – and business models like Jewel’s will depend on being able to reach bigger markets in places like the U.S.

Tax haven

But Burt doesn’t seem worried about the prospect of being shut out.

European Union lawmakers considering the bloc’s landmark Markets in Crypto Assets Regulation (MiCA) have proposed that crypto providers should be barred from serving European markets if they operate from known tax havens. That could potentially include places like Bermuda, which was added to an EU “graylist” of noncooperative tax jurisdictions in February.

The European Commission has urged a rethink of plans it says could breach international trade law. But even if an EU blacklist does emerge for territories with sloppy crypto rules, Burt doesn’t seem worried.

“I would say that if they were to do that type of ranking, Bermuda would probably be at the top of the list,” he said. However, when it comes to regulation, “We know how to do this stuff, and so we have no fear about what may come.”

The FBI and LinkedIn (LNKD) are working together to fight fraudsters using the job-seeking and networking platform to lure investors into cryptocurrency schemes, according to a CNBC report.

• The bad actors pose a "significant threat" to LinkedIn and its consumers, according to Sean Ragan, the FBI's special agent in charge of the San Francisco and Sacramento, California field offices, according to the report. “This type of fraudulent activity is significant, and there are many potential victims, and there are many past and current victims,” Ragan said.

• In a typical scenario, according to the report, a scammer will pose as a professional with a fake profile and reach out to a LinkedIn user, starting with small talk before elevating to an offer to make money through crypto investments. Eventually, the scammer leverages the trust earned over months to direct the user to invest money to a site controlled by the perpetrator, and then drains the account.

• A group of victims told CNBC that their losses ranged from $200,000 to $1.6 million.

• The FBI has seen an increase in this particular investment fraud, said Ragan, confirming also that it has active investigations but could not comment since they are open cases.

• LinkedIn acknowledged in a statement to CNBC that there has been a recent uptick of fraud on its platform. "We work every day to keep our members safe, and this includes investing in automated and manual defenses to detect and address fake accounts, false information, and suspected fraud,” the company said.

• While LinkedIn said it doesn’t provide estimates on how much money has been stolen from members through its platform, it did say it removed more than 32 million fake accounts from its platform in 2021, according to its semiannual report on fraud, the report added.

• The report revealed that the majority of the perpetrators had been traced by the Global Anti-Scam Organization, a victim advocacy and support group, to Southeast Asia.

The Federal Reserve Board has released its twice-yearly monetary policy report, noting that "recent strains experienced in markets for stablecoins…and other digital assets have highlighted the structural fragilities in that rapidly growing sector."

• The report is a preview of Fed Chair Jerome Powell's testimony in Congress next week. Powell is expected to outline the Fed's plans to combat inflation. This week, Powell announced a 75-basis point rise in short-term interest rates, the largest increase in 28 years.

• The report, which is submitted to the President of the Senate and the Speaker of the House of Representatives, elaborated on how "generally, stablecoins that are not backed by safe and sufficiently liquid assets and are not subject to appropriate regulatory standards create risks to investors and potentially to the financial system, including susceptibility to potentially destabilizing runs."

• The TerraUSD stablecoin collapsed in dramatic fashion last month, functionally losing all of its value. The report pointed to the "concentrated nature" of the stablecoin sector in which Tether, USD Coin and Binance USD constituted more than 80 percent of the total market value, growing rapidly over the past year to more than $180 billion in March 2022.

• According to the report, "these vulnerabilities may be exacerbated by a lack of transparency regarding the riskiness and liquidity of assets backing stablecoins."

• The report added that the President’s Working Group on Financial Markets, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency have all made recommendations to address prudential risks posed by stablecoins.

Michelle Bond, the CEO of crypto trade organization the Association for Digital Asset Markets (ADAM) is running for U.S. Congress.

A Suffolk County native, Bond is running for election in the Republican primary in New York’s first congressional district, which includes eastern Long Island. The district is currently represented by Republican Lee Zeldin, who will leave his seat vacant to run for New York governor.

Though Bond has spent years in the crypto industry, she’s not running a crypto-centric campaign, unlike several other political candidates who have emerged from the industry, including longtime bitcoiner Bruce Fenton, who is running for the Republican nomination for New Hampshire’s seat in the U.S. Senate.

Instead, Bond – who describes herself as an “America First conservative” – says she’s more concerned about gas prices and the country’s economic growth. In a campaign announcement provided to CoinDesk, Bond describes herself as “pro-life, pro Trump’s border wall…[and] she believes the police need to be defended, not defunded.”

Bond sees crypto as a part of the bigger picture of financial innovation.

“I’m obviously pro-innovation and I think [crypto’s] important for a lot of different reasons – for jobs, and opportunities and economic advancement,” Bond said. “My job in Congress will be to represent Suffolk County…I think the focus really needs to be on not just the broader topics but everything that’s affecting the day-in, day-out life of the residents of Suffolk County.”

“My experience from fintech and crypto and financial services and even my time on the Senate Banking Committee will inform my decisions but, really, my first and only loyalty is to representing my people at home,” Bond added.

If Bond wins the election, she will step down from her role as CEO at ADAM.

“I love ADAM, it’s been awesome building the association, growing it … I have every intention of staying [on as CEO] if I were not to win, but I’m going to win,” Bond said.

Prior to her role at the trade group, Bond was the head of government relations at Ripple.