Hi Stackers,
Genesis spent recent days seeking at least $1 billion in fresh capital, and it's warning potential investors it may need to file for bankruptcy if its efforts fail, people familiar said. But a spokesperson said there aren't plans to do so imminently.
Let’s dive into the rest of the news this week.
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Crypto.com’s Cronos (CRO) Cryptocurrency Has Decreased in Value Following Concerns of Proof-of-Reserves, While Binance Is Forming an Industry Recovery Fund
The Crypto.com exchange, as well as the wallet provider, is getting scrutiny from the crypto community as on November 13, the analytics provider known as “Lookonchain” did research into the reserves. Based on their data, Crypto.com has Ethereum wallets and Six Bitcoin wallets which hold $2.68 billion in digital assets. The exchange also holds more Shiba Inu (SHIB) than Ethereum (ETH), where it holds $531 million in SHIB compared to $446 million in ETH. It also holds $80 million in its own CRO token.
Changpeng Zhao also made an announcement that Binance will be forming an industry recovery fund aiming to help projects which are strong but in a liquidity crisis. They also welcomed other industry players with cash who are interested in co-investing.
The Collapse of the FTX Exchange and The Consequences
Alameda Research, a trading firm Sam Bankman-Fried founded, was trading billions of dollars from FTX accounts and leveraged the exchange’s native cryptocurrency, FTT, as collateral. Many employees, as well as outside auditors, were unaware FTX did not have enough money, to match the demands of customer withdrawals.
Between $1 billion and $2 billion of FTX customer funds disappeared, as Sam Bankman-Fried had a secret back door through which he could transfer billions. Two sources familiar with the topic said the ex-CEO transferred $10 billion of customer funds from FTX to the asset trading house, Alameda Research.
There were also conflicting reports emerging about the U.S. Securities and Exchange Commission (SEC) helping FTX with legal loopholes. SEC Chairman Gary Gensler was rumored to be helping FTX. However, a new report explains this is not the case.
Charles Gasparino from Fox Business explained the March meeting between the two sides was described by a person attending as a 45-minute lecture by Gensler on what he wants from a cryptocurrency exchange.
A lawsuit was filed against Sam Bankman-Fried alongside other celebrity endorsers of the FTX exchange, alleging FTX took “advantage of unsophisticated investors from across the country” and owed American investors over $11 billion in damages.
The Securities Commission of the Bahamas made an announcement in which it ordered the contents of FTX’s crypto wallet to be transferred to government-controlled wallets. Through a press release, the commission said it had made the order under existing authorities, allowing it to take action if it needs to protect the clients or their funds.
Cryptocurrency lender BlockFi Inc. is preparing a potential bankruptcy filing after it halted withdrawals of customer deposits and acknowledged it had significant exposure to the bankrupt cryptocurrency exchange known as FTX. BlockFi is now planning to lay off workers and is preparing for a Chapter 11 bankruptcy.
Banking Giants, As Well as New York Fed, Began a 12-Week Digital Dollar Pilot.
According to an announcement made by the participants, the Global Banking giants have begun a 12-week digital dollar pilot alongside the Federal Reserve Bank of New York.
Citigroup Inc, HSBC Holdings Plc, Mastercard Inc, and Wells Fargo & Co are just some financial companies participating in the experiment, alongside the New York Fed's innovation center, based on a statement. The project, which is called the regulated liability network, will be constructed within a test environment and will use simulated data.
Binance Announces It Will Relaunch the Bid for the Bankrupt Cryptocurrency Lender Known As Voyager
Binance.US, the American version of the world’s largest cryptocurrency exchange, has begun preparations towards placing a bid for the bankrupt cryptocurrency lending platform known as Voyager Digital, based on people familiar with the topic.
Following the announcement by competing for crypto exchange FTX that they have filed for bankruptcy, Voyager said it has reopened the bidding process for the company and is in active discussions with alternative bidders.
Thanks for reading,
James