Raphael Stevens

Kristin N. Johnson, commissioner at the CFTC, said the regulator has been in conversations with Binance to address its concerns about the company’s conduct.
She said the regulator hopes to find a path forward in the legal battle with crypto exchange Binance — however, at this stage, there is no “immediate path forward.”
The CFTC sued Binance last month alleging the platform solicited users in the U.S. through its platform and allowed them to trade derivatives despite not being authorized to do so.

A Commodity Futures Trading Commission official said Tuesday that she hopes to find a “path forward” in the regulator’s legal battle with crypto exchange Binance, noting that no decision has been taken yet on whether to settle the case or take it to court.
Kristin N. Johnson, commissioner at the CFTC, said that the regulator has been in conversations with Binance to address its concerns about the company’s conduct.

The CFTC sued Binance, its CEO Changpeng Zhao and its former chief compliance officer last month, alleging the platform solicited users in the U.S. through its platform and allowed them to trade derivatives despite not being authorized to do so.
Binance said it would stop operating in the U.S. in 2019.
“I want to be really careful not to prejudge what will actually happen in the litigation. And I want to say that typically, in the context of any litigation, we are always ready to have conversations and typically even ahead of the litigation,” Johnson said in an interview with CNBC’s Arjun Kharpal Tuesday.
“We’ve been in continuing conversations with the business to describe what we understand is potentially problematic conduct and to give them an opportunity to explain that conduct and to help us find a path forward.”
“As of the moment, we can conclude that there is not an immediate path forward,” she added. “That doesn’t mean there couldn’t be one and hopefully there will be one.”

Her comments mark a rare statement on the Binance suit to media since the CFTC first announced it was suing the company on Mar. 27.
Binance was not immediately available when contacted by CNBC. In a blog post following the complaint’s filing, Zhao disagreed with the CFTC’s findings and said the exchange was “committed to transparency and cooperation with regulators and law enforcement” in the U.S. and globally.
The Binance group, unlike its U.S. affiliate Binance.US, isn’t regulated in the U.S. The company has frequently faced criticism for operating in various jurisdictions — including the U.K., Italy and Singapore — without approval.
Crypto companies have faced tougher scrutiny in the U.S. lately in the wake of the $32 billion flameout of crypto exchange FTX and a slew of other industry collapses and a plunge in prices which caused hefty losses for investors.
On Monday, Coinbase filed suit against the U.S. Securities and Exchange Commission — making good on a vow made by CEO Brian Armstrong last week to take the regulator to court. Coinbase suggested the regulator should be forced to clarify whether it would allow the crypto industry to be regulated under existing securities laws.
Johnson said she hopes that Congress will step in to introduce crypto-specific rules soon.
The crypto industry is still largely unregulated, however calls for it to be brought within the regulatory fold have grown following recent blowups in the space like the implosion of crypto exchange FTX and stablecoin firm Terra.
“I do think that we’ll have to be really careful to have dynamic regulation that is not just responsive to the asset classes that we see in the market today but that gives us the flexibility and capability to respond as entrepreneurs and innovators, coders and developers of software protocols continue to release more and more interesting asset classes and products and financial markets,” she said.
“Under immediately existing laws, there is provision to understand how securities laws would apply to any digital assets that qualify as securities. And those the same in the context of commodities,” Johnson said.
“However,” she added, “it is imperative that Congress step up and make plain what their preference is in terms of how to deal with the spot market oversight. I think that’s the singular space, if we went very narrow, specifically to your uncertainty point, that spot market oversight, that definitional piece is very critical. And I think it’s helpful for us if Congress assist us and giving us that guidance.”
WATCH: Bitcoin at $10,000 — or $250,000? Investors are sharply divided on 2023 More

The Venture Capital Alliance (VCA), a coalition of more than 20 venture capital firms, launched Tuesday with the goal of getting the VC industry to increase its commitments to climate tech.
The alliance has laid out guidance that its VC members and their portfolio companies must follow to ensure they meet the requirements to achieve net-zero emissions by 2050.
Some of the world’s largest VC funds, including Tiger Global, have signed up as members of the alliance.

Mark Carney, former governor of the Bank of England, is now the UN special envoy for climate action and finance.
DANIEL LEAL-OLIVAS | AFP | Getty Images

A group of venture capital firms including Tiger Global and Union Square Ventures on Tuesday set up an alliance aimed at making private tech investing more climate-friendly.
Called the Venture Climate Alliance (VCA), the coalition of more than 20 climate tech and generalist funds seeks to get the VC industry to increase its commitments to climate tech, a branch of technology devoted to finding solutions to the climate crisis.

The alliance lays out guidance that its VC members and their portfolio companies must follow to ensure they meet the requirements to achieve net-zero emissions by 2050.
According to a statement, the VCA’s stated aim is to “ensure that methodology and metrics are at the heart of how we determine what is a good climate investment, and what investment will have the greatest positive effect on the mission to build tech for a regenerative world.”
Portfolio companies are given guidance on how they should decarbonize their operations, such as using emission-free data centers, deploying less energy-intensive software in their tech stack, or rebuilding supply chains around low-carbon alternatives, the statement said.
Other funds signed up to the VCA include climate VCs World Fund, 2150, and Prelude Venture. Collectively, the investment firms involved manage a combined $62.3 billion in assets, according to Crunchbase figures.
Generalist VC firms will need to make routine assessments of their carbon footprint, align their early-stage startup bets with net-zero goals. For climate tech-specific investments, VC firms signed up to the alliance will have to ensure the technology they’re investing in has the potential to save at least 100 megatons of carbon dioxide emissions.

It is not the first initiative to bring climate’s role in startup investing to the forefront. Leaders for Climate Action launched in 2020 with specific clauses added to deal term sheets guiding how startup firms should make their operations more climate-friendly.
The VCA takes such initiatives a step further with the blessing of the United Nations. The U.N. approved the VCA as part of its Race to Zero campaign aimed at mobilizing climate action. The alliance will fall under the Glasgow Financial Alliance for Net Zero (GFANZ), a group formed during the COP26 climate conference.
Mark Carney, the former Bank of England governor and currently co-chair of the GFANZ, said investing in climate solutions was “a critical, foundational pillar of a comprehensive, economy-wide transition to net zero, and one of the four financing strategies in the GFANZ net zero transition plan framework.”

“In keeping with our industry-led approach to date, we welcome the launch of the Venture Climate Alliance as a new sector-specific alliance under GFANZ, and applaud efforts by venture investors to establish workable and high-integrity standards for tracking the contributions of early-stage innovations in the transition to net zero,” Carney said in a statement Tuesday.
The VCA aims to amplify efforts by tech startups and their venture backers to combat the climate crisis with new technologies. Technologists are working on a multitude of solutions ranging from carbon capture — the process of capturing and removing carbon dioxide from the air — to battery electric vehicles to tackle climate change.
While climate tech has proven to be a fast-growing area of tech, it still fails to attract the mammoth sums other sectors such as fintech and crypto have achieved. In 2022, fintech companies attracted $79 billion in venture funding, according to data from Dealroom. That was down 38% from 2021. Still, it eclipsed the $50 billion raised by the climate tech sector, which itself saw funding drop 10% in 2022.
Valuations in the climate tech space have also fallen. In 2022, the combined enterprise value of global climate tech startups dropped by 30% to $1.6 trillion, according to Dealroom data.
“The launch of the VCA is no coincidence. If you look at the last year, many generalist funds have learned that some bubbles burst in the fintech space, in the cryptocurrency space, in the e-commerce space,” Danijel Visevic, founder of World Fund, told CNBC.
“I would say everything that is not solving big problems got into big trouble last year, because then suddenly it became obvious that there were valuations across the market that were not backed by the problem those startups and technologies address.”
VC investment as a whole has slumped dramatically in the past year as investors have soured on technology, a sector known for its focus on cash-intensive, rapid growth. The collapse of Silicon Valley Bank, a critical player in lending to climate ventures and other startups, in March was a major blow to the sector.
“Macro conditions more broadly have likely had a bigger impact on the industry than SVB; at the moment we are seeing what looks like more of a correction in valuations than a downturn or an outright intractable market environment,” Alexandra Harbour, founder and chair of the VCA and a principal at Prelude Ventures, told CNBC.
“The burden of proof on teams out raising at 2020 or 2021 valuations can be high, but it’s mostly dependent on their performance over the past several quarters and whether they were able to hit critical milestones.” More

Fidelity Investments’ Peter Lynch
Frank O’Brien | Boston Globe | Getty Images

Legendary investor Peter Lynch has one of the best investing records under his belt, but he still has regrets for not buying into some of the biggest tech companies in recent years.
The former Fidelity Magellan fund manager revealed Tuesday that he wished he hadn’t missed out on the explosive growth in Apple.

“Apple was not that hard to understand. I mean, how dumb was I?” Lynch, vice chairman of Fidelity Management & Research, said on CNBC’s “Squawk Box.” Apple has a “nice balance sheet. I should have done some work on Apple … it’s not a complicated company.”
Lynch recounted how his daughter had bought an iPod for $250 at the time and how he recalled thinking Apple was making a high margin on it. Yet he didn’t buy the stock.
Lynch, 79, acknowledged that Warren Buffett saw Apple’s potential and capitalized on it. The “Oracle of Omaha” had shied away from tech stocks for decades, claiming they were outside of his expertise. But under the influence of his investing lieutenants, he bought into Apple in 2016 and made it his single biggest holding in his portfolio.

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Apple stock – long term

The tech giant turned out to be one of Buffett’s most successful bets in his career, making him more than $100 billion on paper in just a few years. Buffett still views Apple as a consumer product company for its loyal customer base and strong brand effect.
Other than Apple, Lynch expressed regret for not buying into chip giant Nvidia, one of the biggest gainers in the semiconductor space in the past few years and a big enabler in artificial intelligence.

“Nvidia has been a huge stock I wish I could pronounce it,” Lynch joked.

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Nvidia long term

Lynch made his name for managing Fidelity’s Magellan Fund from 1977 to 1990. Under his 13-year management, the fund earned an annualized return of 29.2%, consistently more than doubling the S&P 500′s performance. He also increased Magellan’s assets under management from $20 million to $14 billion during his tenure.
The outstanding record made Lynch a renowned figure on Wall Street, who later wrote investment books including “One Up on Wall Street.” More

Traders wearing masks arrive before the opening bell at the New York Stock Exchange (NYSE) in Wall Street in New York City.
Johannes Eisele | AFP | Getty Images

Check out the companies making headlines before the bell on Tuesday.
First Republic Bank — The San Francisco-based regional bank plunged after it said Monday that deposits fell by 40% to $104.5 billion during the first quarter, which came out worse than Wall Street’s expectations. First Republic said that its deposit flows have since stabilized. The stock was down nearly 22% in early morning trading and has declined by 86.6% so far this year. On Tuesday, Janney downgraded First Republic to sell from neutral and lowered its price target on the stock to $8 from $10, implying a 50% downside from Monday’s closing price.

UPS — UPS shares fell 1.6%after the shipping giant reported quarterly results that missed analyst expectations. The company earned an adjusted $2.20 per share on revenue of $22.93 billion. Analysts expected earnings of $2.21 per share on revenue of $23.01 billion, according to Refinitiv.
3M — The industrial stock added 1.3% before the opening bell. 3M reported $1.97 in earnings per share, higher than analysts expectations of $1.58 from FactSet. The Minnesota-based company announced it would cut about 6,000 positions globally in efforts to focus on high-growth markets such as automotive electrification and home improvement, while prioritizing emerging growth areas such as climate technology and semiconductors.
McDonald’s — Shares advanced less than 1% after the company beat Wall Street expectations for the first quarter. The company reported $2.63 in adjusted earnings per share on $5.9 billion in revenue. Analysts polled by Refinitiv expected $2.33 in per-share earnings and $5.59 billion in revenue. The stock was recently up 9.8%.
General Motors — Shares gained 2.1% after General Motors raised its key guidance for 2023 and reported first-quarter earnings that beat Wall Street’s top- and bottom-line forecasts. The company reported $39.99 billion in revenue, higher than $38.96 billion according to Refinitiv data. Adjusted earnings came in at $2.21 per share, above the consensus estimate of $1.73. General Motors and Samsung SDI are also expected to announce as early as Tuesday that they plan to build a joint battery manufacturing plant in the U.S.
JetBlue — The stock popped more than 2.3% in the premarket after the airline forecasted a “solidly profitable” second quarter due to strong travel demand. For the first quarter, JetBlue posted a 34 cents loss, less than the 39 cents expected, per Refinitiv.

Packaging Corp of America — Shares fell 6.8% after the company reported an adjusted profit per share of $2.20, which came in below a StreetAccount forecast of $2.27 per share. The company’s second-quarter guidance also missed expectations.
Novartis — Shares of the pharmaceutical company added more than 3% after it raised its full-year earnings outlook, saying it expects sales to grow by mid-single digits. Novartis reported earnings per share of $1.71 on $12.95 billion in revenue, topping analysts’ expectations of $1.54 per share on $12.52 billion in revenue.
PepsiCo — Shares of the beverage and snacks giant climbed nearly 1.6% in premarket trading after it posted earnings and revenue that topped Wall Street’s expectations. PepsiCo also raised its outlook on the full year. The company said first-quarter revenue totaled $17.85 billion, surpassing the $17.22 billion consensus estimate of analysts polled by Refinitiv. PepsiCo reported earnings per share of $1.50, topping analysts’ expectations of $1.39.
— CNBC’s un Li, YAlex Harring, Michelle Fox Theobald and Tanaya Macheel contributed reporting. More