🏓 Kraken Down
Hey TC folks. This week has been one hell of a race. There are investigations into a number of crypto companies such as Kraken and Paxos; SBF, FTX, and Voyager litigation; Tether's confidence in the future; Do Kwon's vacation in Serbia; and the not-so-popular CBDC project in China.
Weekly Digest From TradeCrypto.com #3
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Daily statistics update:
Today's market is red. BTC is trading at $21,908; ETH is around $1,551.
💪 Bitcoin dominance: 41.43%
📉 Total Crypto Market Cap: $1.02T
😲 Fear and greed index: 48 (Neutral)
🚀 7d Gainers (Top-100)
• SingularityNET (AGIX) +124.04%
• The Graph (GRT) +64.02%
• Rocket Pool (RPL) +52.20%
😭 7d Losers (Top-100)
• Fantom (FTM) -25.03%
• Aptos (APT) -21.36%
• Terra (LUNA) -21.28%
🔮 Doom Cat: BUSD to crash?
China tries to boost CBDC adoption
If not cryptocurrencies, then government-controlled 🏦 yuans, CBDCs. During Chinese New Year, China began promoting the adoption of e-CNY through millions of funds to 200 "activities" across the country. For example, over $14.7 million in Shenzhen was transferred to the catering industry. Overall, the target is quite lofty, as total usage has yet to reach the $14 billion mark 📌. As a reminder, the largest CBDC pilot project was launched two years ago at $14b. According to a January report, there are only 260 million users who uploaded the e-CNY Wallet app, compared to 903 million who use mobile banking and 360 billion citizens in total.
SBF agrees on communication ban
Apparently, SBF had no choice after DOJ called for a ban and proved that 🤡 SBF may have influenced his ex-employees before they testified. From now on, no one will receive SBF's messages from encrypted apps. However, he can still use Facetime, Zoom, and iMessage. But if something fishy occurs there, prosecutors will see it and punish him. SBF actually got off pretty lightly. And I'm sure if someone wants to deliver a message, they will find💡a way.
South Korean officials travel to find Do Kwon
Destination: Serbia. Remember 2 months ago they posted that Do Kwon was spotted there, and they asked Serbia to cooperate? Interestingly, since then, Do Kwon has been quiet 🤐 on Twitter and only resurfaced this month to respond to posts accusing him of theft. Do Kwon said he didn't steal anything. Yes, Do Kwon so far denies any wrongdoing at Terra. And he has been on the run since the collapse. Your bets: will they catch him? 👮♀️
Voyager subpoenas former FTX and Alameda
Voyager's lawyers took action after last week's incident when Alameda ordered the firm to return $446 million. Now the former FTX Alameda executives must provide tons of documents 🗞, especially copies of all FTX-SEC communications. Papers regarding their financial standing before and after the bankruptcy filing, as well as proof of claim. A fee examiner was appointed to look at it too. If you ask me, this is a very normal reaction from Voyager, as they're trying to prove that FTX screwed them 👊 over by making them believe they were financially stable to buy out the bankrupt company.
Coinbase says SEC will ban staking
Brian Armstrong caused a stir on Twitter saying there were rumors that SEC would ban staking for US retail investors once and for all 🚨. To tell the truth, it spread in the media, and of course, the liquid staking market reacted, leading to a surge in liquid tokens, especially Lido. SEC declined to comment, but some time ago, its chair Gary Gensler said that cryptocurrencies that allow staking can be considered securities, even though ether (ETH) is recognized as a commodity by the CFTC. Many responded by saying SEC doesn't know what it actually is 🤫 cause they say staking is "another indicia that, under the Howey test, the investing public is anticipating profits based on the efforts of others."
Tether shares reserves report
The renowned auditing firm BDO looked at Tether's reserves and found that the company is doing more than just fine 🤌. Not only did they certify that Tether has a clean financial slate, but they also emphasized that its colocated assets of $67 billion exceed its liabilities of $66 billion by $1 billion. Tether said last year that it aims to eliminate commercial paper from its reserves, and BDO says it had indeed done so. Paolo Adrorio, CEO of the stablecoin issuer, praised 🙌 the company on Twitter, saying it is very stable and a good risk manager no matter how bad the crypto market is.
SEC investigates Paxos
A bee probably bit the SEC in the butt as they started probing every company. Paxos is another victim 🤛 if you can say so. Paxos is a stablecoin issuer with its own USDP and Binance's BUSD. The scope of the investigation is really unclear now. This only adds to the rumors that Paxos may withdraw its application for a national trust bank charter from the OCC. Paxos didn't comment 🤫 on the investigation, denying the words of full banking charter withdrawal. Sit tight, my friends, and follow the story closely.
Kraken shuts down staking
Breaking News🚨🚨. SEC Investigation of Kraken was reported a day after Brian Armstrong of Coinbase said the SEC might ban staking for all. The report said SEC was investigating the exchange for flouting rules on selling unregistered securities. The bombshell dropped 💣. Not only does Kraken have to pay SEC $30 million for the law violation, but it also bans staking. Non-U.S. customers aren't affected, and stacked Ether will remain so until the Sharghai hard fork, while other staked tokens will be automatically unstaked. SEC says it's for the good of U.S. citizens, as staking offers rewards but little protection. What a shame, SEC. And a total misconception. Gary said, "Today's action should make clear to the marketplace that staking-as-a-service providers must register and provide full, fair, and truthful disclosure and investor protection." Is this a threat?👊
Arthur Hayes: Be Present
A day ago, Arthur Hayes wrote an essay about why he started buying BTC. Disclaimer: he believes the bull market has started. After the SEC began bombing the US crypto companies, it may be an opportunity to buy a dip. 📉 Arthur said altcoins are also a solid option and that the first 6 months of 2023 are the perfect time to invest. 🪙
Conclusion: SEC is in the spotlight, not only spoiling the U.S. market but also worsening the general mood, making people ask whether cryptocurrencies are over. The thing is, the overall staking market is huge, and even if it's just Kraken, it might be the only one right now. What is the future of Paxos, what do they want to find there, and why has SEC started to torment the crypto industry now? We'll see you next week with answers. As you can see, the week for the industry is a big thing. Recommend you to read Arthur Hayes's essay over the weekend.
See you next week, folks! Thanks for being with us.
Brought to you by Maksym, Yana, and Aleksandar :)
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What is Crypto Ping Pong digest?
TC lads here are working quite hard and from time to time we gotta chill. Recently, we got ourselves a ping pong table to complete our lazy-bag-stuffed chill zone. As you all know our main hobby is Crypto, so even while we play we don’t really shut up about it. Ever.
So memes, leaks, gossips naturally come about – we collect them and share them with you in this interstellar space on our site we like to call Crypto Ping Pong digest.