Cryptocurrency prices played follow the leader on Monday, dropping in the red as macroeconomic forces appeared to affect digital assets. With bitcoin (BTC) trending downward, altcoin prices followed suit, but there were some notable exceptions.
Cryptocurrency prices played follow the leader on Monday, dropping in the red as macroeconomic forces appeared to affect digital assets.
With bitcoin (BTC) trending downward, altcoin prices followed suit, but there were some notable exceptions.
Double-digit gains
EOS and chiliz (CHZ) both posted double-digit gains. Chiliz spiked in the hour after conventional markets closed in North America. (All figures based on CoinMarketCap data.)
For the most part, though, price declines prevailed as bitcoin fell below $22,000 and stock markets declined.
The Dow Jones Industrial Average, S&P 500, and NASDAQ, which contains many tech companies that tend to influence crypto, were down modestly.
FTX exchange coin plunges
The FTX crypto exchange’s coin (FTT) plunged after the company behind it got into hot water with the US Federal Deposit Insurance Corporation (FDIC).
The regulator issued FTX’s US subsidiary a cease-and-desist letter on Friday over alleged misleading statements regarding federally insured accounts. (The FDIC insures bank deposits, excluding cryptocurrencies and stocks.)
FTX president Brett Harrison had stated in a subsequently deleted tweet that “direct deposits from employers to FTX US are stored in individually FDIC-insured bank accounts in the users’ names,” the Verge reported.
The tweet also said that “stocks are held in FDIC-insured and SIPC [Security Investor Protection Corporation]-insured brokerage accounts.”
After complying with FDIC’s request to delete the tweet, Harrison defended it.
Clash with FDIC
“The tweet was written in response to questions raised on twitter regarding whether direct USD deposits from employers were held at insured banks (i.e. Evolve Bank),” he wrote.
But the FDIC argued that the comment falsely suggested that FTX and investors funds were insured by the FDIC.
“We really didn’t mean to mislead anyone, and we didn’t suggest that FTX US itself, or that crypto/non-fiat assets, benefit from FDIC insurance,” Harrison wrote in another tweet.
“I hope this provides clarity on our intentions. Happy to work directly with the FDIC on these important topics.”
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Peter Schiff has shared his view on the lawsuit against Mark Cuban, who allegedly promoted a cryptocurrency scam that led to financial losses among those who invested in a Ponzi scheme.
Schiff believes that Cuban’s story is just the beginning, and he has been warning people for years that when the Bitcoin bubble pops, all people who lost money in the cryptocurrency industry will try to make some of it back by suing people who promoted certain projects or gave investment advice.
The famous Bitcoin critic also believes Cuban knew how dangerous investments in Bitcoin can be, and the businessman knew it was a “scam” but still decided to promote certain projects.
Schiff was surprised that Cuban used the market opportunity and his name to profit from the crypto mania as he thought that the Shark Tank star has more than enough money to live happily without tying his name up with cryptocurrency scams.
In the end, the gold supporter added that only people winning from this whole situation is lawyers. Schiff remains a heavy Bitcoin critic and does not believe in the long-term future of the asset or the technology behind it. Recently, Schiff predicted a significant drop of the first cryptocurrency ahead of BTC’s plunge to $21,000.
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FTX, the crypto exchange controlled by Sam Bankman-Fried, received a cease-and-desist warning on Friday from the Federal Deposit Insurance Corporation, telling the company to stop “misleading” consumers about the insurance status of their funds.
The FDIC issued letters to five crypto companies, including FTX US. Unlike deposits held at U.S. banks, cryptocurrencies stored with brokerages are not protected by the government.
“Based upon evidence collected by the FDIC, each of these companies made false representations —including on their websites and social media accounts — stating or suggesting that certain crypto-related products are FDIC-insured or that stocks held in brokerage accounts are FDIC-insured,” the regulator said in a press release.
In addition to FTX US, the FDIC notified Cryptonews.com, Cryptosec.info, SmartAsset.com and FDICCrypto.com. The FDIC said the companies must “take immediate corrective action to address these false or misleading statements.” The agency said knowingly misrepresenting or implying that an uninsured product is FDIC-insured is prohibited by the Federal Deposit Insurance Act.
In the letter specifically to FTX, the FDIC said it appeared that on July 20, Brett Harrison, the president of FTX.US, published a tweet stating that direct deposits from employers are stored in FDIC-insured accounts in the user’s name.
Harrison tweeted on Friday that he deleted that post and didn’t mean to indicate that crypto assets stored in FTX are insured by the FDIC, but rather “USD deposits from employers were held at insured banks.”
“We really didn’t mean to mislead anyone, and we didn’t suggest that FTX US itself, or that crypto/non-fiat assets, benefit from FDIC insurance,” Harrison wrote.
FTX.US is a U.S. cryptocurrency exchange owned by FTX, which is based in the Bahamas and has been largely focused on building its business outside of the U.S.
The FDIC also said that the websites for SmartAsset and CryptoSec identify FTX as an ”‘FDIC-insured’ cryptocurrency exchange.”
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Big tech critics have long singled out the industry as having too much power, and the cofounder of a powerful crypto giant just chimed in on the matter.
Yat Sui, who leads Hong Kong-based Animoca Brands — which backs a number of major crypto projects and owns The Sandbox — told Bloomberg in a report published Wednesday that his company has invested in more than 340 firms spanning finance, gaming, and blockchain.
The goal, he told Bloomberg, is to tear down tech giants’ dominion over the industry and return online ownership of one’s digital identities and properties back to users. He called the likes of Meta, Facebook’s new parent company, and Microsoft “digital dictatorships” without saying more in the interview.
Siu did not immediately respond to a request to elaborate.
Web3 is, in theory, the future of the internet that will live on the blockchain, the same backbone supporting cryptocurrencies like bitcoin. It won’t be controlled by entities like Google or Twitter.
It’s been a core part of Web3’s argument that a decentralized online world can strip power from the tech monopolies of Web2, namely Meta, Google, Apple, and others. The idea is that since people’s data would theoretically be decentralized — meaning living on the blockchain instead of servers owned by tech conglomerates like Amazon — that would weaken our reliance on the large companies currently dominating the space.
Web3, as it stands right now, is still merely a thought, despite Mark Zuckerberg’s screaming from the rooftops that the metaverse is the future — and spending $10 billion on making it so.
However, Siu and Animoca Brands have been in the Web3 sphere since before the term became a buzzword.
The company was founded in 2014 and has poured cash into a number of significant crypto projects — it bought a stake in Dapper Labs, the parent company of Cryptokitties, in 2018 and owns The Sandbox, one of the more fleshed-out metaverses where rapper Snoop Dogg “lives.”
Animoca has also backed Axie Infinity, a hot crypto game, and OpenSea, the world’s largest online NFT marketplace.
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Digital asset brokerage Genesis said on Wednesday that CEO Michael Moro is stepping down and the company is slashing 20% of its workforce, the latest casualties as the cryptocurrency market unwinds.
Derar Islim, Genesis’ operating chief, will take over as interim CEO while the company searches for a permanent replacement, the company said in a statement.
Genesis is a unit of Digital Currency Group, the crypto investor and conglomerate founded by Barry Silbert. Genesis was early in the market, launching the first over-the-counter crypto trading desk in 2013, and then expanding to become a major lender.
During the 2021 crypto boom, Genesis boosted its book dramatically. Loan originations surged more than sevenfold to $131 billion, and the company increased headcount by 22% to 170 employees. By mid-2022, that number had swelled to 260. A cut of 20% equates to the loss of about 52 jobs.
The rapid turn in the crypto market this year, which sent bitcoin and ethereum tumbling, wiped out firms whose businesses were tied directly to prices of digital assets. Hedge fund Three Arrows Capital, or 3AC, filed for bankruptcy as did brokerage Voyager Digital and crypto lender Celsius Network.
While Genesis has weathered the storm better than other players in the market, the firm suffered significant losses due its exposure to 3AC. In July, Genesis filed a $1.2 billion claim against 3AC because of breached loans.
“Genesis was not immune to the market drop and the damage to overall sentiment,” the company said in a report on second-quarter market observations. “As we’ve stated publicly, Genesis had loan exposure to Three Arrows Capital. Our parent company DCG assumed the liability related to losses on these loans, leaving our balance sheet healthy so Genesis could continue to be a source of strength for our clients.”
Moro, who joined Genesis in 2015 and took over as CEO the following year, will stay on during the leadership transition, Genesis said. The company said it also recently hired new executives as chief risk officer, chief compliance officer and chief technology officer.
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Financial services and investment management firm Galaxy Digital on Monday announced it has terminated the $1.2 billion acquisition of digital asset trust company BitGo as it failed to provide audited financial statements for the year 2021.
The proposed acquisition was the global crypto industry’s first $1 billion deal.
“Galaxy remains positioned for success and to take advantage of strategic opportunities to grow in a sustainable manner,” said Mike Novogratz, CEO and Founder of Galaxy.
“We are committed to continuing our process to list in the US and providing our clients with a prime solution that truly makes Galaxy a one-stop shop for institutions,” he added.
No termination fee is payable in connection with the decision.
Galaxy Digital said it intends to complete the proposed reorganisation and domestication to become a Delaware-based company, and subsequently list on the Nasdaq, upon completion of the SEC’s review and subject to stock exchange approval of such listing.
“Galaxy remains focused on executing its business objectives and driving long-term performance for investors. That includes the planned rollout of Galaxy One Prime,” it said.
Galaxy Digital reported a loss of $554.7 million in the second quarter, up from a loss of $183 million a year ago period, Amod the global crypto meltdown.
BitGo company offers a multi-signature bitcoin wallet service, where keys are divided among a number of owners to manage risk.
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WhiteBIT has Ukrainian origin and is now one of the biggest cryptocurrency exchanges in Europe. The platform recently shared plans to launch its own digital asset, WhiteBIT Token (WBT). The token will provide the users with unique opportunities like fee reduction, holding benefits and much more.
WhiteBIT has been giving its users striking announcements since the beginning of its largescale market expansion. Just a month ago, the platform completed its functionality with perpetual futures trading, becoming one of the few crypto exchanges in the world that offer such a possibility. Now, WhiteBIT is planning to launch its own token, which seems a natural step for an exchange of this level.
Here are the main facts to know about WBT:
- It will have a limited supply.
- The token design presupposes organic interactions with other projects of the ecosystem.
- WBT ownership promises various bonuses to tokenholders.
- The token will have a weekly burning mechanism.
The asset will be issued in the amount of 400 million WBT, with 200 million as treasury tokens. This amount will be distributed to corresponding funds inside the ecosystem to protect the asset from inflation. Treasury tokens will be gradually unlocked within the following three years. Half of the issued tokens will be frozen and brought to the market according to the pre-designed schedule.
WhiteBIT users will be able to enjoy numerous benefits from owning and holding WBT. The exchange plans to hold profitable activities, trading competitions and bounties to prove the effectiveness of the new asset and build a community around it. Here are some of the advantages for WBT holders and owners to enjoy:
- A 40-50% increase in the referral rate
- Reduced fees
- Free ERC-20-protocol token withdrawals
- Free Anti-Money Laundering checks and much more.
Being an in-house token, WhiteBIT Token will gradually expand the scope of its possibilities available to platform users. Learn more about WBT on the official WhiteBIT platform.
Volodymyr Nosov, WhiteBIT CEO, said, “WhiteBIT Token is the implementation of a long-cherished idea of a truly effective token designed to give the best to users. Smooth interoperation of all WhiteBIT ecosystem products, generous fee reduction, increased rates for the referral program, and much more, are only [some] of the prospects this asset entails.”
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The Netherlands Crime Agency (FIOD) said it arrested a 29-year-old who is a suspected developer of Tornado Cash, the crypto mixer that was slapped with US sanctions earlier this week.
The platform, which mixes cryptocurrencies into the decentralized ethereum network and hides the origin of users’ tokens, was prohibited from operating in the United States earlier this week after the US Treasury said North Korean hackers had been using the service for money laundering.
US Treasury officials say the platform has laundered around $7 billion in crypto, and an analysis by TRM Labs shows North Korean hackers are responsible for $1 billion of the laundered funds.
Regulators did not name the suspect, but said he was detained on Wednesday and will be presented to a judge today in the Netherlands for helping money laundering and concealing other criminal financial activity on Tornado Cash’s platform.
“Multiple arrests are not ruled out. These advanced technologies, such as decentralised organisations that may facilitate money laundering are receiving extra attention from the FIOD,” regulators said in a statement.
The sanctions on Tornado Cash are the latest development as regulators crack down on the crypto industry and turn the screws on decentralized finance firms. 2022 has seen a wave of high profile crypto hacks and cyberthefts.
Earlier this year, North Korean hackers stole $625 million in cryptocurrency from Axie’s Infinity Ronin Network, one of the largest thefts in history of the blockchain. Another $100 million was stolen from Harmony Bridge – with evidence that 98% of those funds were later laundered through Tornado Cash, according to an analysis from Elliptic.
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Billionaire bitcoin bull Mike Novogratz believes the forced deleveraging of the cryptocurrency market is over and that investors can expect new narratives to shape the space following a brutal quarter for digital assets.
His optimism comes after a rocky year for crypto investors, following the crash of the Terra stablecoin and the related Luna token, which set off a domino effect of losses and bankruptcies across the sector. Crypto has enjoyed a few rallies since then, but the bitcoin and ethereum are still down around 60% from their November highs.
“We had a forced deleveraging that happened because of a lot of imprudent credit policies at lots of places, that I think exacerbated how bad the move would be,” Novogratz said in an interview with CNBC.
But Novogratz thinks that the cycle is ending, with the potential for more positive change in the crypto market to come this quarter.
“The worst is over,” he said of last quarter’s big sell-off. “There is no more forced deleveraging that’s going to happen. And so now, the market hits an equilibrium, and it waits for new narratives.”
Developments like ethereum’s upcoming merge could be a big narrative shift for the market, one that generates renewed enthusiasm among investors, Novogratz said. The merge is one out of five planned updates to the ethereum blockchain, CoinDesk reported, and will switch the blockchain over from a proof-of-work to a proof-of-stake system to increase efficiency.
Bitcoin may also be on a new path, with Coinbase’s recent partnership with BlackRock: “That’s like a monumental announcement,” Novogratz said.
Bitcoin’s steady adoption in mainstream finance is keeping Novogratz bullish on the largest crypto by market cap. He added he was particularly optimistic about the outlook for the coin in the current economic climate.
“I think bitcoin remains a really good macro asset for an environment where the macro is pretty uncertain,” Novogratz said.
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Working toward its stated goal to build the highest-performing, most reliable blockchain application programming interface (API) platform, Bware Labs, the company behind Blast, is launching the Houston Incentivized Testnet.
The purpose of the testnet mainly revolves around verifying all the technical aspects involved in the decentralization of the Blast API Platform, from the proprietary Node Integrity Protocol to the staking mechanism. At the same time, it aims at preparing future node providers for the mainnet launch while giving them the option to obtain enough funds to join the platform in its production state.
In terms of rewards, the total amount reserved for the entire Houston Testnet is 1 million Bware Tokens (BWR), which is 1% of the total token supply. The tokens received during the testnet will be sufficient for each participant to be able to run at least one node when the mainnet is live.
Bware Labs claims that — thanks to its integrity protocol and incentivization mechanism — the Blast API platform will be able to keep the highest level of performance in the industry even after decentralization takes place. This means that no change in the quality of service will be visible to its constantly growing number of adopters and customers, among which it can already enumerate CoinGecko, Decentralized Information Asset, Connext Network, Moonwell, Subscan, DappRadar and many others.
The first phase — dubbed the launch phase — of the Houston Testnet will be restricted to the companies’ closest partners from the infrastructure and node-operating segments. The list includes reputable companies with vast experience in running blockchain infrastructure such as Dokia Capital, Stakin, P2P, Hashquark, Hypersphere and Woodstock. Once this preliminary stage is completed, Bware Labs will welcome independent node runners to onboard the testnet in the orbit phase, or phase two, and earn rewards while helping the company achieve its mission of providing quality-driven, decentralized services.
The Houston Incentivized Testnet will end with the landing phase — the third phase, where the creativity of participants is required in finding improvements, corner cases or other feedback that will help the platform become more robust and easier to use by both API consumers and node providers.
All details for the Houston Testnet — as well as the schedule and missions for those interested in becoming Blast partners as node providers — are available on the Houston Testnet landing page at houston.blastapi.io/houston-testnet.
About Bware Labs
The mission of Bware Labs is to create an infrastructure and development ecosystem that can help Web3 builders throughout their entire blockchain journey. The company aims to play a decisive role in worldwide blockchain adoption.
Proving its commitment to bringing true reliability and quality to Web3, Bware Labs has partnered with some of the greatest names in the industry, such as Polygon, Avalanche, Elrond, Moonbeam and Fantom. This will further support blockchain development efforts by providing the highest quality infrastructure services in the crypto space.
Bware Labs also supports Blockchain projects from a validator role. Capitalizing on its engineering team’s vast blockchain experience, the company is trusted by more than 15 blockchain networks to run validators for its projects.
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