Sam Bankman-Fried: Founder of bankrupt crypto firm FTX arrested in Bahamas
What's happening in crypto
This week, the cryptocurrency industry has seen many big developments. Here’s the latest brought to you by Stack - the best developer tracking data in Web3.
Goldman Sachs announced plans to invest in crypto companies, the Federal Trade Commission is investigating firms, and the Office of the Comptroller of the Currency (OCC) has issued a warning.
Additionally, Circle has canceled plans to go public, Coinbase CEO Brian Armstrong has said the firm's revenue will decrease by 50% or more, and Ethereum developers have determined March 2023 as a solid date to release Staked Ether (ETH). Finally, Warner Music Group, Polygon (MATIC), and EGND have conducted a strategic partnership to launch a Web3 Music Platform.
Let’s dive in.
Goldman Sachs Seeking Crypto Firms After FTX Event, the Federal Trade Commission Is Investigating Firms, and the OCC Issues a Warning
Goldman Sachs announced plans they are aiming to spend tens of millions of dollars towards buying or investing in crypto companies after the collapse of the FTX exchange left them with lower valuations.
Mathew McDermott, Goldman's head of digital assets, told Reuters FTX’s implosion ended up resulting in the requirement of trustworthy, regulated cryptocurrency players, where big banks are seeing this as an opportunity to pick up new business.
Additionally, The Federal Trade Commission is investigating numerous firms as a part of a new crackdown on deceptive advertising within the cryptocurrency space as a whole.
However, a spokesperson declined to name any firms or say what prompted these investigations.
"While we can't comment on current events in the crypto markets or the details of any ongoing investigations, we are investigating several firms for possible misconduct concerning digital assets," the spokesperson stated.
The Office of the Comptroller of the Currency (OCC) has warned banks of the emerging risks surrounding cryptocurrencies, claiming the sector should take a cautious approach and seek permission when engaging with crypto or crypto firms in specific cases. OCC highlighted there were several key risks of crypto in its December 8 Semiannual Risk Perspective for Fall 2022 report.
SBF Arrested in Bahamas
The Royal Bahamian Police Force announced that FTX founder Sam Bankman-Fried had been arrested.
The statement said that the arrest came after the United States filed criminal charges against Bankman-Fried, and the nation expects the United States to request Bahamian extradition of Bankman-Fried in short order.
"As a result of the notification received and the material provided therewith, it was deemed appropriate for the Attorney General to seek SBF’s arrest and hold him in custody pursuant to our nation’s Extradition Act," the statement, attributed to Attorney General Ryan Pinder, said.
The New York Times said the charges could include wire fraud, securities fraud, money laundering and related conspiracy charges.
Circle Has Canceled Plans Towards Going Public
The stablecoin issuer known as Circle, the company behind USD Coin (USDC), has terminated the agreement with the special-purpose acquisition company known as Concord Acquisition Corp and, as such, is stepping back from plans of going public.
The firm announced both of the companies approved the move. However, Circle originally announced plans to go public in July of 2021, with a valuation of $4.5 billion. This valuation was later doubled when they amended their terms in February.
The Chief Executive Officer (CEO) of Circle, Jeremy Allaire, said that the firm had not completed the U.S. Securities and Exchange Commission's "qualification in time."
Coinbase CEO Sees Revenue Decrease 50% or More Throughout the Crypto Route
Coinbase Global Inc. Chief Executive Officer (CEO), Brian Armstrong, announced that the cryptocurrency exchange's revenue would be cut by half or more throughout the year as the declining prices, as well as the collapse of its rival, FTX, has decreased the confidence investors initially had.
Through an Interview on Bloomberg’s “David Rubenstein Show: Peer-to-Peer Conversations,” Brian Armstrong stated, “Last year in 2021, we did about $7 billion of revenue and about $4 billion of positive EBITDA, and this year with everything coming down, it’s looking, you know, about roughly half that or less.”.
Additionally, Coinbase published an article on December 8 prompting users to make the switch from Tether (USDT) to USD Coin (USDC) with zero fees. They stated that USDC is one of the most trusted, as well as reputable digital dollars that is fully backed with reserves of high quality.
Ethereum developers have determined March 2023 as a solid date to release Staked Ether (ETH)
The developers behind the Ethereum blockchain have determined that the network's next hard fork, known as "Shanghai, "will have a target release time frame of March 2023. This upgrade will include code from EIP 4895 that will allow Beacon Chain staked Ether (ETH) withdrawals.
Developers were also in agreement to address the implementation of the EVM Object Format (EIF) in the Shanghai upgrade, featuring a collection of EIPs that upgrade the Ethereum Virtual Machine (EVM), an environment in which smart contracts are executed. The Ethereum Improvement Proposals (EIPs) included are EIP 3540, EIP 3670, EIP 4200, EIP 4570, and EIP 5450.
Warner Music Group, Polygon (MATIC), and EGND Conduct Strategic Partnership to Launch a Web3 Music Platform
An ecommerce and interactive platform builder, known as LGND.io, has formed a strategic partnership with the Polygon (MATIC) blockchain network developer alongside Warner Music Group to create a Web3 platform purpose-built for music known as LGND Music.
It is scheduled to launch in January 2023, and it is designed to be a music and collectibles platform with support for digital collectibles from any blockchain through a proprietary player. Its main goal is to make it possible for users to play their digital collectibles anywhere.
The partnership will also enable select Warner Music Group artists to launch digital collectibles on both the application and the desktop platforms. These creators can then interact with their fan base through special content and curated experiences. It will be built on top of Polygon and, as a result, aim to offer low gas fees and quick transactions.
Thanks for reading,
James