09 Dec 2022

The Friday Focus: Issue 63

It’s all about policy this week, and lawmakers are louder than ever after the FTX collapse. Let’s dive into it!
The Friday Focus SVG
Weekly happenings
Top storiesAs usual, let’s start with the latest FTX-related news. Alameda Research’s investments were leaked this week, and it’s now clear where some of the customer funds went; In mostly illiquid private placements, and it was reportedly over $5 billion. FTX held talks with Taylor Swift over a $100 million sponsorship deal, but it never went through. FTX’s newly acquired LedgerX is up for grabs (and solvent) as part of the restructuring process. Sam Bankman-Fried is also facing market manipulation inquiries related to TerraLuna. Moreover, SBF has hired Mark Cohen as his defense attorney. The same attorney recently defended Ghislaine Maxwell in her sex trafficking trial. Sounds like someone is guilty…Headlines have been heavily focused on policy this week. Let’s start in the US, where the House Financial Services Committee is weighing a subpoena for SBF, and The Senate Banking Committee wants him to testify the day after, on Dec 14. Talking about subpoenas, Three Arrows Capital founders, Zhu and Davies, are (finally) getting subpoenaed.In other US policy news, SEC Chair Gary Gensler assured us that SEC could go after crypto firms with its current authority, the FTC is investigating crypto firms over misleading advertisement, and senators want more info on Silvergate’s “egregious failure” on FTX. Moreover, a new US bill would require crypto miners to report greenhouse gas emissions. Crypto is, without a doubt, on the agenda among lawmakers and regulators in the US these days.In the EU, a new crypto taxation proposal could bring in $2.5 billion, as companies offering EU residents crypto services will need to report on transactions to tax authorities. The European Commission is hoping for enforcement starting in 2026.Moving over to crypto exchange news, Bybit just announced layoffs of 30%. Binance’s BTC reserves are supposedly overcollateralized, according to an audit report, and Binance US is expanding zero trading fees to ETH. Coinbase is also making moves, now asking users to switch from USDT to USDC, and the CEO says that their revenue will collapse by over 50% this year.Genesis has been making headlines this week. The company reportedly owes over $900 million to Gemini customers, and the total loans to creditors amount to $1.8 billion, and counting. Genesis also said its plan to resolve the lending unit’s woes could take weeks. In other lending news, Nexo is moving out of the US, and Celsius has been ordered to return almost $50 million of user funds. Talking about Celsius, Galaxy snapped up Celsius’ crypto custodian GK8 in an auction win last week.It’s not completely dead on the TradFi scene despite the state of the crypto market. Goldman Sachs is reportedly hunting for bargain crypto firms after FTX’s collapse, with its CEO writing an op-ed in the WSJ this week. Still, most news stories have a negative taste to them. Signature Bank is trying to move away from its crypto stamp as it sheds deposits, but several analysts are still downgrading the company. And in a series of canceled SPACs recently, stablecoin provider Circle was the latest to pull the plug this week.Some notable NFT headlines are worth mentioning this week. Nike’s RTFKT unveiled new web3 sneakers, Warner Music Group will release Polygon music NFTs, and Starbucks NFTs are now available to beta testers.That’s all for this week. Until next time!
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