Here are some of the major developments in the world of crypto over the past few days.
ARK Invest has terminated its partnership with 21Shares and is no longer involved in the ETF. As a result, 21Shares filed an updated Ethereum Spot ETF S-1 filing and changed the fund name from ARK 21Shares Ethereum ETF to 21Shares Core Ethereum ETF. As part of the partnership, 21Shares sponsored the ETF and Delaware Trust Company acted as trustee.
Coinbase Custody Trust Company held the underlying Ether assets securely, while ARK Investment Management played a supporting role as a sub-advisor in charge of marketing the shares to investors. In addition to Bitcoin and Ethereum futures, the duo launched another product called the ARK 21Shares Blockchain and Digital Economy Innovation ETF.
ARK Invest and 21Shares collaborated in September 2023 to submit an application for a spot Ether ETF. The fund aims to provide Ether direct exposure and trade on the Cboe BZX Exchange, which will utilize the CME CF Ether-Dollar Reference Rate—New York Variant. Last week, the U.S. Securities and Exchange Commission approved Form 19b-4 for eight Ethereum ETFs. Issuers must activate their S-1 statements before they can begin trading.
Cryptocurrency exchanges that have not applied for an operating license with the Hong Kong Securities and Futures Commission (SFC) are required by law to immediately cease operations in the region. To minimize investor risks, Hong Kong regulators have given cryptocurrency exchanges a clear ultimatum to apply for a license by February 29 or cease operations within three months.
In May alone, six cryptocurrency exchanges, including global players such as OKX and Huobi HK, withdrew from the Hong Kong market. While most exchanges did not provide any reasons for the surprise turn of events, Hong Hong-based Gate.HK cited the need for a “major overhaul” of its trading platform before it could comply with Hong Kong’s regulatory requirements.
As of May 31, 18 cryptocurrency exchanges have applied for operating licenses in Hong Kong. The SFC said the list of approved exchanges will be announced by June 1. The SFC recommends investors to consult the official list of approved exchanges to mitigate risks associated with trading cryptocurrencies.
Centralized cryptocurrency exchange DMM experienced a server hack on May 30, leading to a loss exceeding $305 million ($67,656) worth of Bitcoin (BTC). The exchange temporarily suspended withdrawals, new account openings, new spot buy orders, and new leveraged orders.
Crypto users began discussing the attack on social media platforms, where new unknown wallets were transferred. The exchange said it had "already taken steps to prevent unauthorized transfers" and would "procure the appropriate amount of BTC" to ensure all users are compensated.
DMM Exchange is owned by the DMM Group, an e-commerce conglomerate. It was founded in January 2018. The company also owns a cryptocurrency mining company. Hacking and fraud remain a problem for cryptocurrency exchange users, and in November, the Poloniex exchange lost more than $100 million after an attacker seized its private keys.