Meta Digest

SEC fired up the crypto community after Coinbase notice

Stephen Reynolds Stephen Reynolds on March 23, 2023

SEC – US authorities have started cracking down on the crypto area, which has had a significant impact on the community.

The SEC sent a warning to Coinbase on Wednesday, saying that the company’s staking products are unregistered securities.

Parts of the Coinbase exchange and Coinbase Wallet were also discussed.

The SEC’s moves against Coinbase have sparked outrage in the cryptocurrency world.

As a result, concerns have arisen concerning the implications of the situation for bitcoin in the United States.

Coinbase

According to reports, Coinbase executives are dissatisfied with how the SEC enabled US investors to participate in cryptocurrency for years before abruptly pulling the rug out from under them.

For months, Coinbase allegedly engaged in regulatory and policy discussions with the SEC.

They began immediately after petitioning the SEC in July, asking the authorities to initiate a public rulemaking process to define what would be constituted securities.

Coinbase sent a letter to the SEC on Monday to clarify the rules governing staking.

The SEC subsequently informed the corporation that it would take enforcement action against it.

Coinbase CEO Brian Armstrong discussed how the SEC permitted the business to go public on the Nasdaq in a Twitter thread.

Coinbase informed customers earlier on Wednesday that Algorand staking incentives will be suspended on March 29.

In that afternoon, Paul Grewal wrote a blog post claiming that the Wells Notice did not offer information to which they could reply.

 

Reaction

Caitlin Long, the founder and CEO of Custodia Bank, shared her thoughts on Twitter, writing:

“It should be crystal clear by now that the Biden Administration wants all crypto – even the legit parts of it – run out by the US.”

“See also yesterday’s White House economic report, which dunked on all financial innovation while espousing the “stability” of traditional banks.”

Long and others questioned the SEC’s unexpected issuance of a “Wells Notice.”

For years, they permitted Coinbase, a publicly listed firm, to provide staking incentives, but have just recently threatened to sue the company, saying they issued unregistered securities.

“Over the past 9 months, [Coinbase] has met with the SEC more than 30 times, sharing details of our business to build a path to registration,” wrote Coinbase Chief Legal Officer Paul Grewal.

“During this time, the SEC hasn’t given basically 0 feedback on what to change, or how to register. Instead, today we received a Wells Notice.”

Chris Dixon, general partner at Andreessen Horowitz, chipped in, saying:

“Since day one, @coinbase has invested heavily in being fully compliant with US laws even when it forced them to move slower or lose a competitive edge vs other exchanges that chose to take shortcuts.”

“The US has a strong history of fostering innovation, and regulators have played a key role by establishing clear rules and pursuing bad actors,” he continued.

“We hope the US will take a more constructive approach to collaborating with innovators while protecting consumers.”

Read also: Stablecoins witness change after Circle confirms SVB exposure

Support & criticism

Numerous members of the cryptocurrency community have shown their support for Coinbase, saying they stand with the firm and Adam Cochran, the founder of Cinnemhain Ventures (CEHV).

Although others criticized the SEC, some members of the cryptocurrency community used the occasion to bash Coinbase.

The most outspoken complaints came from the XRP community, many of whom were still irritated by Coinbase’s removal of XRP from the Coinbase Wallet last fall.

Nevertheless, Ripple Labs has been fighting the SEC in court since December 2020.

The corporation was accused of deceiving investors and raising $1.3 billion in unregistered securities, according to the agency.

“I doubt I will ever understand how the SEC can sign off on @coinbase being publicly listed then raise all these issues afterwards,” said attorney Bill Morgan.

“Forget just crypto, how is the SEC protecting shareholders of Coinbase with this dreadful conduct?”

Image source: CryptoSlate

Silicon Valley Bank CEO slammed for ‘stupid’ strategy

Hector Andrews Hector Andrews on March 20, 2023

Silicon Valley Bank – The initial distress of the SVB collapse has passed out, and people are looking for someone to blame.

Silicon Valley Bank CEO Greg Becker is being blamed by the tech industry.

Many people hold Becker responsible for the corporation’s standing as the second-largest American financial disaster in history.

According to an alleged SVB employee, Becker openly acknowledged the bank’s financial difficulties before secretly offering cash aid to weather the storm.

As a result of the actions, many withdrew their money, creating a scared atmosphere.

“That was absolutely idiotic,” said the employee. “They were being very transparent.”

“It’s the exact opposite of what you’d normally see in a scandal. But their transparency and forthright-ness did them in.”

The buildup

Last Wednesday night, Greg Becker and his leadership team stated that they expected to raise $2.25 billion in cash from $21 billion in asset sales, resulting in a $1.8 billion loss.

SVB has failed to make any definite commitments, despite its best efforts.

The announcement jolted Silicon Valley, where the bank has been a key lender to tech entrepreneurs.

Several entrepreneurs were worried.

Many firms withdrew $42 billion on Thursday, according to California regulator data, while Silicon Valley Bank’s shares plunged 60%.

Silicon Valley Bank had a negative cash position of around $958 million when it ended that day.

“People are just shocked at how stupid the CEO is,” said the SVB employee.

“You’re in business for 40 years and you are telling me you can’t raise $2 billion privately? Get on a jet and fly to Kuwait like everyone else and give them control of one-third of the bank.”

The CEO of Silicon Valley Bank, Greg Becker, is said to have apologized to staff in a video statement.

“It’s with an incredibly heavy heart that I’m here to deliver this message,” said Becker.

“I can’t imagine what was going through your head and wonder, you know, about your job, your future.”

Read also: Silicon Valley Bank collapsed, crypto space affected

Hysteria

According to Jeff Sonnenfeld, CEO of Yale School of Management’s Chief Executive Leadership Institute (CELI), Silicon Valley Bank officials deserve to be chastised for their “tone-deaf, mismanaged execution.”

Sonnenfeld and CELI’s research director, Steven Lian, declared in a joint statement:

“Someone lit a match and the bank yelled, ‘Fire!’ – pulling the alarms in earnest out of genuine concern for transparency and honesty.”

Sonnenfeld and Tian stated on Wednesday night that publicizing the $2.25 billion unsubscribed capital offering was unnecessary.

They stated that Silicon Valley Bank has adequate capital to meet regulatory standards.

They also claimed that disclosing the $1.8 billion gap was unnecessary.

According to Sonnenfeld and Tian, the one-two punch created a tremendous frenzy, culminating in a rush to withdraw deposits.

They suggested that the bank may have separated the statements by at least one or two weeks, therefore lessening the impact.

President Joe Biden’s administration launched a proposal to help Silicon Valley bank clients on Sunday.

Biden also stated that the US government will properly investigate all parties involved in the SVB disaster.

He released a statement saying:

“I am firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again.”

The Fed’s involvement

Jerome Powell, the Chairman of the Federal Reserve and Biden’s choice to lead the Feds, and his colleagues, according to Jeff Sonnenfeld and Steven Lian, carry part of the blame.

“There should be no mistaking that Silicon Valley Bank’s collapse was a direct result of the Fed’s persistent and excessive interest rate hike,” they wrote.

According to them, the Fed’s attempts to decrease inflation had two impacts:

  • The value of the bonds Silicon Valley Bank was relying on for capital
  • The value of the tech startups SVB catered

Silicon Valley Bank, on the other hand, had more than a year to plan for and address the difficulties.

The unidentified SVB employee referred to the bank’s balance-sheet manipulation as “stupidity,” calling the CEO and CFO’s plan into question.

But, the employee, who is also a Wall Street veteran, feels the bank’s demise was due to errors and “naivety” rather than unlawful activities.

“The saddest thing is that this place is Boy Scouts,” they said.

“They made mistakes, but these are not bad people.”

Image source: The Business Journal

Blockchain industry set to flourish in the Middle East

Josh Barter Josh Barter on March 20, 2023

Image source: IDB

Blockchain technology has been the hottest topic in the tech industry for the past few years, and it is now looking to take a leap forward.

A new blockchain and crypto association was recently formed in the Abu Dhabi Free Economic Zone.

It aims to improve the blockchain and crypto ecosystem development in the Middle East, North Africa and Asia.

The association

The Middle East, Africa & Asia Crypto & Blockchain Association (MEAACBA) was established a few days earlier at the Abu Dhabi Global Market (ADGM).

In addition, the ADGM is a free economic zone in the city center.

It is governed by its own civil and commercial laws.

Additionally, the zone aims to promote the growth of fintech businesses in the United Arab Emirates (UAE).

The non-profit organization aims to facilitate regulatory solutions, create business opportunities and invest in education to support industry growth.

Staff

The MEAACBA will be led by CEO Jehanzeb Awan, the founder of an international risk and compliance consultancy based in Dubai.

Other association supporters include:

  • Richard Teng, Binance’s regional head of the Middle East and North Africa (MENA)
  • Stuart Isted, Crypto.com’s general manager of Middle East and Africa
  • Ola Doudin, the CEO of BitOasis, a cryptocurrency exchange in the region

In addition, Awan said he hopes the organization will bring a collective and community-based approach to improve industry growth in the MENA region.

He also hopes to develop far-reaching benefits for the “highly dynamic and exciting” space.

“The industry will benefit from the Association as it provides a coordination mechanism between regulators, government agencies, banks, legal tax, and advisory firms to address the most pressing challenges,” said Awan.

In addition, Ahmad Jasim Al Zaabi, ADGM’s chairman, said that the MEAACBA’s addition would help create a more “progressive financial sector” in the region.

The launch

The launch of MEAACBA comes as the FSRA in November released a set of “guiding principles” in its approach to dealing with the regulatory complexities that the digital asset industry brings.

The Financial Services Regulatory Authority is the financial regulatory body of the ADGM Free Economic Zone.

Additionally, the principles are “crypto-friendly.”

It continues to adhere to the United Nations’ strict international anti-money laundering (AML) and counter-terrorist financing (CFT) standards.

Moreover, recent studies show that the MENA region is the fastest-growing cryptocurrency market.

Additionally, between July 2021 and June 2022, the volume of transactions in the MENA region increased by 48% over the last 12 months.

It reached $566 billion.

The use case for cryptocurrencies in emerging markets comes from holding savings and remittances.

Finally, it curbs inflation in unstable economies.

Reference:

Middle East, Asia, and Africa blockchain association launches in Abu Dhabi

Ledger Stax to revolutionize hardware wallets

Josh Barter Josh Barter on March 20, 2023

Ledger Stax – As the crypto space develops in prominence, so are the innovations to accommodate it.

Although being present for almost a decade, hardware wallets have only recently gained momentum.

Those who have used them have generally described them as functional.

Most hardware wallets look like USB sticks, pocket calculators, or remote automobile key fobs.

They appear simple, yet they hold a big quantity of money.

The French hardware wallet company is attempting to gain market share with the release of its latest gadget, the Ledger Stax.

The new wallet

With its luxury appearance, the Ledger Stax is a polished-looking piece of hardware that appears like another Apple product.

Tony Fadell, the original iPod’s creator, came up with the idea.

Fadell designed the Stax to be a sleek piece of hardware with industrial design advances such as the first curved E Ink display.

The key selling feature of the Ledger Stax is its display.

It is intended to be a desirable product, a showcase for eye-catching crypto assets such as NFTs.

A curved screen wraps around one side of the wallet, while the narrow face shows information such as the battery level and device name.

The aluminum and plastic Ledger Stax features the company’s new branding on the back face.

The hardware contains a USB-C port on the bottom and a sleep button on the side.

The Stax, on the other hand, can charge wirelessly and interact with other devices through Bluetooth and NFC.

Additional features

The Ledger Stax is the same length and height as a credit card, but its 6mm thickness makes it more difficult to fit into a wallet.

The Stax also weighs a comfortable 45g, which is the sole drawback to its premium feel.

Additionally, the hardware has magnets that allow users to stack wallets together like a stack of books, taking advantage of the option to put a name on the wallet’s spine.

The Ledger Stax, priced at $279, might tempt multimillionaire NFT collectors.

Read also: Avalon digital universe expansion receives massive funding

Transactions

Potential purchasers can access the Ledger Stax functionalities via the Ledger Live app.

Users must link the gadget with a smartphone using Bluetooth.

After creating the transaction on Ledger Live, they can send Bitcoin, Ethereum, Dogecoin, or other cryptocurrencies.

They may then review the transaction information on the Ledger Ledger and sign it.

Users sign transactions by long pressing the E Ink screen, a feature that differs from the previous Ledger hardware devices’ two-button press.

Most people would be concerned about transaction speed, however receiving on the Stax is simplified by the E Ink screen, which shows the wallet’s QR code.

NFTs

A demonstration demonstrated how consumers may configure their NFTs on the Stax screen using Ledger live.

Users merely need to press on “lock screen picture,” and their NFT collection will be shown.

Customers then click on their preferred NFT, which gives them the ability to alter the contrast levels to make the image stand out.

The Ledger Stax’s slickness is likewise simplified, earning it the moniker: “Web3’s iPod moment.”

Limitations

The simplicity, however, is restricted since crypto novices are still wrestling with the concepts of wallet addresses and transaction signatures.

Additionally, people concerned about security will continue to debate Bluetooth’s inclusion.

Although private keys are a safe component of the gadget, Ledger admits that some consumers will be hesitant to utilize the wireless protocol.

Although Ledger Stax is clearly one of the most inventive designs, it lacks one distinguishing feature.

Because NFTs are often colorful and occasionally animated, black-and-white E Ink is incompatible.

Nevertheless, if Ledger releases a new version of the Stax that supports colorful screens, it will very certainly be the leading choice for individuals looking for hardware wallets.

Image source: Dezeen

FTX struck with major debt to 50 creditors

Clara Emily Clara Emily on March 20, 2023

Image source: The Block

FTX, the well-known cryptocurrency, has been in trouble for the past few weeks.

FTX owes $3.1 billion to its top 50 creditors, according to documents filed Saturday in Delaware bankruptcy court.

The document clarifies the extent of potential losses suffered by clients.

The filing

According to Saturday’s filing, the crypto exchange’s top 10 creditors each have more than $100 million in unsecured claims.

The claims total more than $1.45 billion.

The filing explained that the debt does not include anything owed to company insiders.

However, this may change with additional information.

FTX owes its largest creditor more than $276 million.

The company now owes around $21 million to its 50th largest creditor.

Despite the enormous debt, the filing can only scratch the surface of what the company owes.

Last week, FTX said it could have over a million creditors.

The company owes its third-largest creditor $174 million.

Although unconfirmed, the figure matches what Genisis, a cryptocurrency lender, announced ten days ago: $175 million in funds locked in its FTX trading account.

Read also: FTX probed by Bahamas police in the weekend

Filing notice

A notice accompanying the filing explains that FTX based the totals on information that can be seen but was not accessible.

The notice says the company was unable to access customer data fully.

FTX, led by new chief executive John J. Ray III, said in the filing that its debt numbers might be inaccurate.

There may be payments to creditors that need to be reflected in the books or records of the company.

Creditors

A request was filed to withhold information about FTX’s creditors and their personal information.

In addition, the motion says disclosing creditors’ names could give predatory companies a lead.

It reads:

“Public dissemination of the Debtors’ customer list could give the competitors an unfair advantage to contact and poach those customers, and would interfere with the Debtors’ ability to sell their assets and maximize value for their estates at the appropriate time.”

“The Debtors historically did not keep appropriate books and records,” it continued.

“[And] the Debtors are currently working to access certain sources of data and records that are currently unavailable.”

Read also: Creator royalties to stay on several NFT marketplaces

Chapter 11 cases

The decision to create a list of FTX creditors came from overlapping creditors in its Chapter 11 cases, unorganized filing, and limited time and resources.

“Creditor information, and in particular customer information, is not clearly labeled or identifiable by [FTX],” the motion reads.

“As a result, presenting the information on a consolidated basis will ensure the most relevant and known information can be promptly disclosed.”

A date is ready for the “first day of hearing” in FTX’s bankruptcy proceedings.

As a result, it will take place in Wilmington, Delaware, on Tuesday.

Reference:

FTX says it owes over $3 billion to its 50 largest creditors

Alameda payments handed SBF billions while others only got millions

Vina Grady Vina Grady on March 17, 2023

Alameda – On Wednesday, the infamous crypto exchange business FTX’s new management made an unexpected announcement concerning its founder’s compensation.

The company’s co-founder and ex-boss, Sam Bankman-Fried, reportedly got $2.2 billion in payments and loans from Alameda Research.

The sum is enormous and sticks out in comparison to other executives.

Caroline Ellison, the former CEO of Alameda Research, received only $6 million in compensation.

According to new management documents, a total of $3.2 billion was awarded to ex-FTX workers, the vast majority of whom came from the company’s sister trading firm.

Alameda

When FTX went bankrupt in late 2022, Alameda Research was right in the middle of it.

Sam Bankman-Fried founded the quantitative trading firm as well.

According to newly appointed FTX CEO John J. Ray III, who took over leadership after SBF left, Alameda has the right to use FTX customer assets for its own objectives without oversight.

FTX, on the other hand, was previously regarded as one of the pinnacles of the Web3 period.

It was a cryptocurrency exchange where customers could purchase, sell, and speculate on the future prices of various cryptocurrencies.

Before its demise, FTX had over 134 enterprises under its umbrella and was located in the Bahamas, which was more open to bitcoin.

SBF founded Alameda in 2019, however he claims he will step down as CEO in 2021, leaving day-to-day operations in the hands of others.

Authorities suspect that the sudden collapse of FTX was caused by management putting extraordinarily risky wagers with customer cash given by Alameda Research.

The payouts

According to papers released this week by FTX’s new management, SBF received the majority of the $3.2 billion in compensation.

While he received the most money, former FTX director of engineering Nishad Singh received $587 million.

Meanwhile, co-founder Gary Wang pocketed $246 million.

Ryan Salame, former FTX Digital Markets co-CEO, earned $87 million, while Sam Trabucco, former Alameda Research co-head, received $25 million.

According to the announcement, they did not include the significant sum of more than $240 million spent on purchasing luxury property in the Bahamas.

It should also be mentioned that Trabucco stepped down as CEO of Alameda in August.

Since then, he has not been seen or heard from.

Despite the fact that the rest of SBF’s inner circle has already been prosecuted, prosecutors have refused to charge Sam Trabucco.

Read also: Sam Bankman-Fried receives $250 million release bail, ordered to stay with family

Ellison

Upon Trabucco’s resignation, Caroline Ellison was named Alameda Research’s sole CEO in October 2021.

They were once co-CEOs of the platform.

Ellison and Sam Bankman-Fried had an on-again, off-again relationship.

While her involvement in the company’s failure was well known, her background gained even more interest, since her now-deleted Tumblr blog gave an uncommon perspective on what transpired in the Bahamas penthouse.

The penthouse housed ten people, including Ellison and SBF, who made important decisions there.

The group was classified as a “polycule,” or a network of persons in a polyamorous relationship, so decisions were not the only thing going on.

In November, Ellison’s blog, which was active from 2014 until 2022, presented content that coincided closely with her past.

Her site shows a strong interest in racial science and polyamory.

It also provided further insight into the author’s viewpoint on the crypto industry, as expressed in one post:

“I didn’t get into this as a crypto true believer. It’s mostly scams and memes when you get down to it.”

The charges and the company today

Sam Bankman-Fried is currently facing 12 felony accusations in the United States, some of which were handed down in a superseding indictment in February.

The charges allegedly include a conspiracy to defraud FTX clients through derivatives purchases and sales.

In January, SBF pleaded not guilty to the initial charges.

Since then, he has been awaiting his trial in October.

Meanwhile, Ellison, Wang, and Singh have confessed and are cooperating with police.

FTX client cash worth billions of dollars are now missing, with a major amount allegedly taken.

Image source: Salon.com

Stablecoins witness change after Circle confirms SVB exposure

Josh Barter Josh Barter on March 15, 2023

Stablecoin –  The failure of Silicon Valley Bank last week alarmed the tech and crypto industries, with the latter especially affected in the aftermath of the 2022 FTX failure.

Circle reported that it had been exposed to Silicon Valley Bank, and USDC was momentarily depegged over the weekend.

Anticipating the worst, investors looked to a variety of options.

The news

USDC holders were concerned after the SVB crash over the weekend, while holders of other stablecoins saw a more productive movement.

The market capitalizations of these projects increased dramatically.

Circle, the world’s second-largest stablecoin by market capitalization, reduced its dollar peg to $0.87 on Friday.

The abrupt drop might be ascribed to the corporation reporting that it kept around $3.3 billion in cash reserves at Silicon Valley Bank.

Circle swiftly reassured investors that their risk was limited, stating that the entire amount of its capital in SVB was less than 10% of USDC’s $42.1 billion cash reserves.

On Monday, American and British officials intervened, restoring public trust in Circle.

The stablecoin is now worth a fraction of a penny less than its peg.

When USDC rebounded, rivals had already capitalized on Circle’s stumble.

Tether

Tether has been one of the most contentious stablecoin producers, but its token, the USDT, rose somewhat over the weekend.

Alex Mahinsky, then-CEO of insolvent crypto lender Celsius, told the Financial Times in 2021 that Tether was minting USDT against top cryptocurrency Bitcoin and Ethereum collateral for a few of significant customers.

Tether, on the other hand, was fined $41 million by the Commodities Futures Trading Commission (CFTC) in 2021.

The CFTC is an independent American government authority that regulates derivatives.

The corporation misled about its financial reserves, and it lacked USDT for a significant stretch between 2016 and early 2019.

Tether’s openness has since increased.

It engaged BDO Italy in August 2022 to generate periodical attestation reports for USDT reserves.

After Silvergate and Silicon Valley Bank failed, Tether CEO Paulo Ardoino told investors that the firm was not at risk..

Gains

USDT had a market capitalization of $71.9 billion on Friday.

Nevertheless, by Monday evening, the sum had risen to about $75 billion.

Nonetheless, the market cap slid slightly, but not before recording a 1.6% rise overall.

Dai

The Maker, one of DeFi’s longest-running initiatives, maintains and regulates DAI’s stablecoin supply.

It is also supported by cryptocurrencies, specifically USDC.

Other Ethereum-based cryptocurrencies, such as Ethereum and Wrapped Bitcoin or WBTC, can also be used to mint it.

DAI is sometimes referred to as a decentralized stablecoin due to the decentralized structure of its collateral and the fact that the protocol overseeing the stablecoin is not monitored by a single organization.

With a market valuation of $6.2 billion, DAI is now the fourth largest stablecoin on the market.

Gains

DAI had a market valuation of $4.9 billion on Friday.

But, by Monday morning, the figure had risen by 28.6%.

Its current market capitalization is $6.3 billion.

Individuals looking to get rid of USDC were most likely directed to DAI.

As individuals burnt USDC, the availability of DAI increased dramatically.

Nevertheless, DAI was depegged on Saturday and fell to a low of $0.88, paralleling USDC.

Read also: Chainspace creates NFT portals connecting Bitcoin and Ethereum

TrueUSD

TrueUSD, an Ethereum-based stablecoin, was announced in 2018 as the first regulated stablecoin to be entirely backed by the US dollar.

TUSD is backed 1:1 by cash, according to Chainlink’s proof-of-reserve monitoring tool.

The SEC prepared a complaint against Paxos, the company behind Binance’s dollar-pegged BUSD stablecoin, in February.

As an alternative, Binance issued $180 million in TUSD, accounting for the 114.5% growth in TUSD’s market valuation during the last month.

TrueUSD, on the other hand, was vulnerable to Silvergate.

Minting and redemptions were halted for some Signature Bank users.

According to a Monday tweet, the remainder of TrueUSD’s banking network was unaffected.

Gains

TUSD’s market worth remained at $1.3 billion throughout the day on Friday.

Its market worth increased by 53.8%, and it has been above $2 billion for the previous two days.

Liquity USD

Liquity is similar to DAI in that it operates on the same principles, but with the addition of interest-free loans.

Instead of fluctuating interest rates, Liquity charges a modest one-time fee upfront with its loans.

LUSD is its dollar-pegged native coin, and loans are made in LUSD with Ethereum as security.

As the concerns over the crypto banking crisis and Circle’s depegging faded, Liquity CEO Michael Svoboda pushed his stablecoin by retweeting LUSD supporters.

Gains

On Friday, LUSD had a market capitalization of $230 million.

It increased by 10.4% over the weekend and is now worth $256.2 million.

Image source: Root Stock

Ava Labs CEO finds silver lining in crypto industry shift after FTX

Clara Emily Clara Emily on March 13, 2023

Ava Labs – The crypto market crashed in 2022, and it became even more chaotic when the largest crypto exchange platform FTX went bankrupt.

The fall caused a domino effect, putting financial hardship on other crypto firms who were exposed to FTX.

It also resulted in some firms declaring bankruptcy, closing down, or freezing assets.

Emin Gün Sirer, the founder and CEO of Ava Labs, accused Sam Bankman-Fried, the creator of FTX, of causing massive damage.

The news

The FTX collapse last autumn stung an already battered sector even more.

The collapse of the once-mighty crypto exchange harmed its reputation, particularly the industry’s legitimacy and confidence.

“The damage that Sam [Bankman-Fried] did is immeasurable,” said Sirer.

“All that goodwill that we built over many, many years of hard work is just usurped by some guy who comes in and puts on this boy genius act.”

The CEO of Ava Labs stated that he has witnessed the digital assets business evolve from nothing to what it is now.

He also mentioned that he worked hard as a computer science professor at Cornell University to bring additional knowledge and understanding into blockchain technology.

Sirer has also organized workshops and provided information about cryptocurrencies to legislators.

Emin Gün Sirer recounted how the prospect of Sam Bankman-Fried’s effect on the crypto realm kept him awake at night.

The CEO of Ava Labs stated that he was aware of shifting regulatory tides, warning that it may be risky for persons and organizations working in cryptocurrency.

SBF

The crypto market imploded in the summer of 2022, and digital asset values plummeted.

Sam Bankman-Fried, the now-famous FTX founder, rose to prominence during this period.

His profile soared, drawing comparisons to John Pierpont Morgan for the 30-year-old entrepreneur.

The crypto crisis was akin to the 1907 economic panic, and Morgan was important, if not godlike, in determining which enterprises would survive and whose would perish.

SBF’s reputation had been unrivaled for months, until everything changed in November.

Downward spiral

When FTX fell apart, Sam Bankman-reputation Fried’s as the crypto’s golden boy began to erode.

Following a run on the exchange triggered by a sharp decline in the FTT token, FTX’s native token, the firm declared bankruptcy.

According to the bankruptcy complaint, the crypto exchange did not maintain one-to-one reserves of customer assets.

As a result, FTX was unable to accept withdrawals.

Read also: Blur continues momentum with incentive program

Arrest

Sam Bankman-Fried was detained in December 2022.

He was eventually accused with a slew of offenses ranging from fraud to money laundering.

SBF is accused of stealing billions of dollars in client monies.

Sam Bankman-Fried pled not guilty despite growing evidence.

Later, the FTX founder would face further allegations, including illicit political donations.

Donations totaled tens of millions of dollars.

Scrutiny

Former partners compared SBF to Bernie Madoff as a result of his shenanigans.

Skybridge’s managing partner, Anthony Scaramucci, regarded SBF as a friend before his betrayal.

“I thought Sam was the Mark Zuckerberg of crypt,” said Scaramucci. “I did not think he was the Bernie Madoff of crypto. I got it wrong.”

Nevertheless, Ava Labs CEO claimed Sam Bankman-Fried’s lack of scrutiny was due to the image he worked hard to maintain.

Sirer discussed how he groomed his unkempt hair and spent so much money on marketing to change the world’s perception of him as a genius.

Aftermath

The aftermath of the FTX collapse, according to Emin Gün Sirer, would rely on establishing a positive discussion with regulators.

The CEO of Ava Labs emphasized the failure of numerous cryptocurrency startups and projects trapped in the company’s web of deception.

Additionally, Sirer stated that it is critical to stress that FTX’s fate was caused by a centralized body, not crypto itself.

Silver linings

After the conundrum FTX set up, Emin Gün Sirer is now looking for a silver lining.

Although he is aware of the harm and the subsequent spread to other firms, the Ava Labs CEO feels the damage would have been greater if it had gone unchecked.

“If we had given Sam a couple more years of runaway, it would have been worse,” said Sirer.

He also realized how SBF’s antics drew attention to crypto.

“I no longer have to educate people on what Bitcoin [or] Ethereum is.”

Emin Gün Sirer also expressed happiness that Ava Labs was never a “Sam coin.”

“We were never a Sam coin, and therefore we stayed out of that whole craziness,” said the Ava Labs CEO.

“And we’re just thanking our lucky stars for it.”

Image source: Coincu News

FTX Japan allows withdrawals again

Hector Andrews Hector Andrews on March 13, 2023

FTX Japan – Despite the fact that FTX, a significant crypto exchange site, has been inactive for months, there has been movement in releasing the frozen monies.

Customers of FTX Japan may now withdraw their crypto deposits and fiat money, according to an announcement made on Monday by the company’s Japanese affiliate.

The withdrawal procedure will take place via the Liquid Japan cryptocurrency trading platform, which FTX purchased in the spring of 2022.

The news

Although withdrawals were suspended in November 2022 when Sam Bankman-Fried’s crypto empire failed and filed for bankruptcy, the latest news gives FTX Japan clients some cause for optimism.

The Tokyo-based business claims that customers who qualify can withdraw their money.

By email, they were informed of the procedure.

Customers must open a Liquid Japan account and validate the balance on their FTX Japan account in order to withdraw money.

The announcement

In a blog post, FTX Japan expressed regret to its clients and provided them with information on how to withdraw their money.

“We are very sorry for the concern and inconvenience caused to our customers due to the suspension of our service,” the blog post said.

“In order to proceed with withdrawals, customers who have assets in their FTX Japan account would need to confirm the balance of their assets and transfer them to their Liquid Japan account.”

“Customers who do not have a Liquid Japan account are required to open one before they can transfer assets.”

“We have sent an email to all eligible customers regarding the details of the procedures.”

“If you have not completed the procedure, please follow the instructions in the email and complete the process.”

“Please note that due to the large number of requests from customers, it may take some time for the withdrawal process to be completed.”

“We will announce the resumption of other FTX Japan services as soon as possible.”

Read also: Chainspace creates NFT portals connecting Bitcoin and Ethereum

Japanese subsidiary

FTX Japan was one of the more recent branches when compared to other subsidiaries.

It began operations in June 2022 and lasted less than six months until the cryptocurrency exchange went down.

“Japan is a highly regulated market with a potential market size of almost $1 trillion  when it comes to cryptocurrency trading,” Sam Bankman-Fried said in June 2022.

SBF was chosen as the interim CEO when FTX Japan first went live.

Customers who utilized other FTX subsidiaries like FTX.US aren’t as fortunate as those who used FTX Japan, where the most recent advancement will allow customers to breathe.

While the international exchange is going through bankruptcy procedures in a Delaware court, other subsidiaries are still suspended.

The fall of an empire

The top cryptocurrency exchange in the market, if not the top one, was FTX.

However, the exchange’s bankruptcy filing in November 2022 shook the cryptocurrency community.

The exchange’s native cryptocurrency, FTT, had a sharp decline in price, which prompted the bankruptcy filing.

When assets began to leave FTX, it became clear that FTX was unable to maintain one-to-one reserves of client assets.

As a result, the exchange was unable to process withdrawals, which forced firm executives to declare bankruptcy.

As soon as Sam Bankman-Fried was taken into custody and accused with financial offenses like:

  • Wire fraud
  • Conspiracy to commit money laundering

Notwithstanding the weight of the evidence against him, SBF has entered a not guilty plea.

FTX progress

FTX submitted a motion in December 2022 seeking authorization for the sale of the four financially sound subsidiaries of the business, namely:

  • Embed Technologies
  • FTX Europe
  • FTX Japan
  • LedgerX

The goal of the initiative was to assist the corporation in raising capital and pay off creditors who are owed billions of dollars.

Recently, the Southern District of New York court presiding over SBF’s criminal case considered an addendum to his bail arrangement that forbade him from using devices.

He made the choice as a result of using the Signal app to communicate encrypted messages across a virtual private network.

The group in charge of FTX’s bankruptcy proceedings issued a warning last Friday about scam tokens posing as FTX customers’ debt.

“The FTX Debtors have not issued any debt token,” tweeted FTX. “Any such offers are unauthorized.”

Image source: VOI

Apple’s updated review guidelines map out new NFT policies

Hector Andrews Hector Andrews on March 13, 2023

Tech giant Apple remains adamant about its controversial stance on NFTs and is responding to it with updated App Store policies.

According to Apple Insider, Apple released its updated NFT review policies on Monday.

NFTs can exist in App Store’s apps but cannot unlock additional features or content.

The guidelines

Per the policy, apps can use in-app purchases to sell NFTs and NFT-related services, such as:

  • Minting
  • Listing
  • Transferring

“Apps may allow users to view their own NFTs, provided that NFT ownership does not unlock features of functionality within the app,” the guidelines read.

How it affects users

Apple’s policies are likely to discourage users from purchasing NFTs.

NFTs typically unlock token-gated content such as NFT Moonbirds and NFT Bored Ape Yacht Club.

NFT holders get exclusive access to merchandise, various communication channels and other benefits.

Developers will not have the authority to create buttons, external links, or calls to action that indicate how users can navigate the App Store to purchase NFT via other platforms.

Instead, the App Store wants users to make in-app purchases.

They are also not allowed to pay in cryptocurrencies.

The importance of the guidelines

App Store Review Guidelines tell developers what they can and cannot publish to the App Store.

If they violate the guidelines, Apple will reject or remove the apps.

Apple announced that it would take a 30% cut of all NFTs sold in apps offered through its App Store in the past.

The new update coincides with its previous announcement.

Last month, the news disappointed Tim Sweeney, the CEO of Epic Games and a crypto enthusiast.

He said Apple should be stopped because its decision crushed “nascent technology” that could rival its overpriced in-app payment service.

Other notes

Besides NFTs, Apple is changing some of its language regarding cryptocurrency exchange apps on the App Store.

“Apps may facilitate transactions or transmissions of cryptocurrency on an approved exchange,” the guidelines wrote.

“Provided they are offered only in countries or regions where the app has appropriate licensing and permissions to provide a cryptocurrency exchange.”

Reference:

Apple bans using NFTs to unlock content, features in apps

Image source: Tech Crunch