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Welcome to the Forward Guidance newsletter, brought to you by Ben Strack and Casey Wagner. Here’s what you’ll find in today’s shortened edition:

• Coinbase seeks to use the SEC’s Ripple case appeal to advance its own legal fight. Ben has the details. 

• Jobs week is behind us; now we’re on to inflation week! Casey shares what you need to watch for in the coming days.

The SEC’s appeal of the court’s decision in its case against Ripple appears to be having, well, a ripple effect. 

As a refresher: A federal judge ruled last year that while Ripple’s institutional sales of XRP counted as an unregistered securities offering, programmatic sales did not. The court then, in August, ordered Ripple to pay a $125 million penalty — far below the $2 billion the SEC had sought.

The US securities regulator appealed that decision last week.

Now, crypto exchange Coinbase has referenced the SEC’s appeal in a letter to Judge Katherine Polk Failla (overseeing the SEC v. Coinbase suit) — urging the court to grant its own motion for interlocutory appeal from earlier this year.

By doing so, the court “would help ensure that the Second Circuit has before it a full account of the legal and practical implications of the SEC’s litigating position — a position that the SEC acknowledged just weeks ago has sown ‘confusion,’” wrote lawyer William Savitt, who is representing Coinbase. 

A Coinbase spokesperson told me in an email on Monday that the company “remains confident that we are right on the facts and the law.”

Indeed, the company has the legal bills to prove its belief that this is a fight worth fighting.

Blockchain Association policy counsel Laura Sanders told Blockworks that the SEC’s appeal underscores that it’s essential for the court to weigh in on various foundational questions. “Namely: Is an obligation past the point of sale required for a secondary-market transaction to involve an investment contract?” she explained.

You probably know by now that the so-called Howey test is used to determine whether something is an investment contract and should thus be regulated as a security. 

Well, the word “Howey” appeared four times in Savitt’s letter. The lawyer notes the SEC’s appeal reconfirms that “the issues presented by Howey’s application to secondary-market digital asset transactions are of ‘industry-wide significance.’”

Arie Heijkoop, a partner at law firm Haynes and Boone, said the appeals court should take into account the facts of each case as it considers both. A ruling on each appeal — which in this case would be made by the same court — would go a long way to determine how digital assets should be treated under current US securities laws.  

“And given that the SEC has not shown a willingness to provide official regulation or guidance on these matters, having it settled through litigation seems to be the way to get any clarification with this SEC administration,” he said.  

The court's decision to grant the appeal motion or not will ultimately depend on how much appetite it has for this clash, Heijkoop added.  

“The judges will have to decide whether there is enough in all the pleadings and filings before it to make a big decision that could ultimately steer the industry,” he said. “Or whether they want to see the battle develop and play out further.”  

— Ben Strack

The amount of money that left bitcoin investment vehicles last week, according to CoinShares data. In a sign investors may be moving more toward a risk-off strategy, digital asset investment products on the whole recorded $147 million of net outflows. 

CoinShares analysts attribute the moves to Friday’s better-than-expected jobs report, which has markets anticipating a lower interest rate cut from the Federal Reserve next month.

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Happy Monday! With the September jobs report in the rearview mirror, the focus this week is back on inflation. Here’s what we’ll be watching: 

• The minutes from the FOMC meeting last month — when central bankers opted for a large cut of 50 basis points — will drop on Wednesday. As a reminder: The dot plot showed that most committee members see us ending 2024 with a federal funds rate between 4.25% and 4.75%. The minutes will give us a better understanding of how they came to this decision, though. After Friday’s positive jobs report, markets on Monday were calling for a 25bps cut in November, with fed funds futures prices showing an 84% likelihood, according to CME Group. 

• We’ll get the weekly initial jobless claims data on Thursday. Analysts are expecting a slight uptick in first-time filers for the week ended Oct. 5 — calling for 230,000, vs. 225,000 the week prior. On the heels of September’s jobs report, a mild increase shouldn’t be enough to spook markets, but any sign of unemployment edging lower is going to be appreciated. 

• Also on Thursday, we will get September’s CPI report, followed by the PPI on Friday. Analysts expect core CPI to show a 0.2% monthly increase, down from the 0.3% rise recorded in August. PPI is similarly projected to show prices are inching lower, as analysts forecast a 0.1% monthly increase vs. 0.2% in August. 

• Last but not least, we will get the University of Michigan’s consumer sentiment survey, which is expected to come in a bit higher than last month (70.3, compared to 70.1). It’s a good litmus test for how optimistic Americans are feeling about their finances and the economy at large.

— Casey Wagner

How will the asset management sphere adapt to the growing prominence of digital assets?

Jeff John Roberts of Fortune will be interviewing Coinbase’s President of Asset Management Sebastien Bea at Permissionless to explore this multitrillion-dollar question.

• Bitcoin’s price surged to roughly $64,300 today before settling above $63,500 just after 2 pm ET — up roughly 1% from 24 hours ago.

• As alluded to earlier, US spot bitcoin ETFs notched about $275 million of net outflows last week, according to Farside Investors data. Flows into their ETH counterparts over the same span (Sept. 30 to Oct. 4) were also negative, at about $25 million. The latter ETF category has seen $548 million of net outflows since the July 23 launches.   

• Crypto-focused asset manager 21.co has linked up with Crypto.com, the company revealed Monday. As an initial step in the “long-term, strategic partnership,” 21.co Wrapped Bitcoin (21BTC) will source bitcoin liquidity from Crypto.com. 

• It’s officially Permissionless week. We hope to see some of you in Salt Lake City!