This week, Twitter served as a public confessional where the many crypto companies affected by FTX’s sudden, historic collapse came forward to declare just how much exposure they had to the bankrupt exchange.
This week in coins. Illustration by Mitchell Preffer for Decrypt.
This being week two of the FTX disaster story, crypto investors can expect things to get worse before they get better. However, the two market leaders, Bitcoin and Ethereum, no longer appear to be in freefall.
Bitcoin (BTC), the largest cryptocurrency by market capitalization, only dropped 1% over the past week and trades at $16,655. Ethereum (ETH), the No. 2 cryptocurrency, shaved off about 4% of its value and trades for $1,210 a...
The intensity of conversations surrounding the collapsed exchange didn’t really abate this week. On Monday, Binance CEO Changpeng Zhao—who two weekends ago exposed FTX’s insolvency when his announcement that Binance sell all its holdings of FTX’s native token, FTT, caused a bank run on the exchange—denied accusations that he was just shorting the token.
Full disclosure: Binance never shorted FTT. We still have a bag of as we stopped selling FTT after SBF called me. Very expensive call. https://t.co/3A6wyFPGlm
The disgraced former billionaire was also tweeting cryptic one-letter tweets. By Tuesday, it became clear that he was very slowly writing the words “WHAT HAPPENED.” On Wednesday, he gave his side of things with the caveat that his “memory might be faulty in parts.” The full thread ran 32 tweets long.
In less than a week, one of the largest and most trusted crypto exchanges went up in flames, along with its crypto celebrity founder and CEO Sam Bankman-Fried. Dan Roberts, Stacy Elliott, and Kate Irwin from the gm podcast walk you through exactly how it happened, what it means for you, their own takes on the most interesting subplots, and what we can learn from it all. Plus: We review some comments SBF and CZ made on this podcast that look remarkable in hindsight. Watch and make sure to subscribe to the gm podcast on Apple or Spotify.
Bankman-Fried’s strange behavior prompted several conspiracy theories, the most convincing one being that he was tweeting new tweets while he was simultaneously deleting old ones in an attempt to escape detection by bots that repost deleted tweets.
He needn’t have gone to so much trouble, though. Turns out one account archived them.
We've archived @SBF_FTX's tweets over the past year. Due to the recent bankruptcy, and growing concern around his account activity, we've decided to release the list of 118 tracked tweets that have since been deleted after posting.https://t.co/ts04Mbvv1z
Ethereum co-founder Vitalik Buterin on Tuesday weighed in on the whole drama.
Automatically downgrading every single thing SBF believed in is an error. It's important to actually think and figure out which things contributed to the fraud and which things didn't.
Don't be the guy who would have tried to cancel vegetarianism in 1945.
Vitalik Buterin, Ethereum co-founder and perhaps one of the most recognizable people in crypto, chastised ex-FTX CEO Sam Bankman-Fried today when asked about the businessman and the collapse of his exchange.
At the LaBitConf conference in Buenos Aires, Argentina, the man behind the second-biggest cryptocurrency said the colossal collapse of FTX was inevitable because of its centralized nature.
“This year we’ve seen a huge number of things that break because they have a model which is fundament...
On Thursday, a 30-page affidavit from new FTX CEO John J. Ray revealed that FTX itself doesn’t know how much cash it has, or even how many people it employs. Ray said he had “never” seen anything like it in his career—and he was the lawyer who shepherded Enron through its historic bankruptcy proceedings.
Jonathan Wu, who heads growth at Aztec Network, an Ethereum-based privacy solution, cherry-picked the best parts of Ray’s report in a thread.
I just read FTX's Chapter 11 First Day Affidavit.
In it, the appointed restructuring CEO John Jay Ray III, who oversaw Enron's bankruptcy proceedings, calls FTX's case the worst of his career.
Jordan Schachtel, an independent journalist, pointed out the fact that the lawmakers investigating FTX’s collapse have been pretty chummy with Bankman-Fried over the last year.
— Jordan Schachtel @ dossier.substack.com (@JordanSchachtel) November 17, 2022
Twitter’s new CEO Elon Musk is himself feeling heat from authorities over his conduct since taking office, particularly the mass layoffs. Musk used the FTX catastrophe to make light of the situation in a meme.
Several businesses did well this week following the FTX catastrophe, including cold wallet manufacturers and decentralized exchanges (DEXs), both of which offer customers self-custody solutions to keep their crypto safe from withdrawal freezes by secretly insolvent exchanges. Uniswap creator Hayden Adams noted that on Monday, his exchange was the second largest in the world for Ethereum trading behind Binance.
Vitalik Buterin welcomed the sudden change in consumer preferences. He also urged caution.
The "centralized anything is evil by default, use defi and self-custody" ethos did very well this week, but remember that it too has risks: bugs in smart contract code.
Grayscale’s world-leading Bitcoin Trust has been hitting new lows as a result of the current bear market. Its shares currently trade at a heavy discount of 45% to its underlying asset. This is not good news for investors. Crypto researcher @Mhonkasalo explained in a couple of charts why it would be a bad thing for the whole market if Grayscale were to suddenly liquidate its crypto holdings. It may seem unlikely, but the crypto asset manager has done it before, with XRP.
If Grayscale liquidates what comes on the market: - 635k BTC (~$13.3b). - 3.1m ETH (~$3.7b).
The Full Federal Court of Australia ruled in favor of crypto lender Block Earner on Tuesday, overturning previous findings that its discontinued "Earner" product constituted a regulated financial product requiring licensing.
An appeal from the Australian Securities and Investments Commission (ASIC) to impose penalties on Block Earner was dismissed, with the regulator ordered to pay full legal costs, including those incurred from the original trial.
With the ruling, the court has completely overt...
Circle, the company behind the USDC stablecoin, has unveiled an infrastructure platform aimed at modernizing cross-border payments by allowing banks and financial institutions to move money instantly, 24/7, using fully reserved digital dollars (USDC) and euros (EURC).
The Circle Payments Network (CPN) will allow banks and financial providers to send money instantly, 24/7, using stablecoins like USDC and EURC. It is designed to support invoice payments, remittances, treasury services, payroll, an...
Publicly traded company Upexi plans to create a Solana corporate treasury, using more than $90 million worth of newly raised funds. The Monday announcement sent Upexi shares skyrocketing, more than quadrupling in price as a result.
The Nasdaq-listed consumer products firm, which has been diversifying into the crypto space, raised $100 million in its latest funding round, the company said Monday in a press release. Roughly 95% of those funds are earmarked for establishing, filling and operating a...
