FTX Transfers $145M in Stablecoins to Crypto Exchanges

• Three wallets associated with FTX and its subsidiary, Alameda Research, have moved around $145 million in stablecoins.
• FTX is currently attempting to recover assets and liabilities exceed $8.8 billion.
• Alameda Research recently sold its remaining interest in venture capital firm Sequoia Capital to the Abu Dhabi sovereign wealth fund for $45 million and filed a lawsuit against Grayscale Investments in the Court of Chancery in Delaware.

FTX-related Stablecoins on the Move

$145M transferred to crypto exchanges as three wallets reported associated with FTX and Alameda Research have moved 69.64 million USDT and 75.94 million USDC between them.

Ongoing Investigations

Faced with demands from different groups of investors, FTX continues to move funds amid multiple ongoing investigations.

FTX Recovering Assets

According to lawyer Andy Dietderich, by January 2023, the troubled cryptocurrency exchange had already recovered $5 billion in cash and liquid cryptocurrencies – however total liabilities exceed $8.8 billion.

Alameda Sells Interests

Alameda Research sold its remaining interest in venture capital firm Sequoia Capital to the Abu Dhabi sovereign wealth fund for a payment of $45 million.

Lawsuit Against Grayscale Investments

The company has also filed suit against Grayscale Investments in the Court of Chancery in Delaware seeking „to unlock $9 billion or more in value for shareholders“.

SEC Accuses Utah Firm of $18M Crypto Mining ‚Fraud‘ Scheme

Summary

• The US Securities and Exchange Commission (SEC) has filed a complaint against Green United LLC, its founder Wright Thurston, and contracted promoter Kristoffer Krohn for offering securities in the form of $3,000 „Green Boxes“ and „Green nodes“ purported to mine the GREEN token on the „Green Blockchain“.
• The SEC alleges that these offerings were fraudulent as the hardware sold didn’t mine GREEN as it was an Ethereum-based ERC-20 token that could not be mined and the Green Blockchain didn’t exist.
• The real scheme, according to the SEC, was using the funds to buy S9 Antminers — Bitcoin BTC $22,268 Bitcoin -1.05% MARKET CAP$430.02bVOL. 24H$769.90m BTC $34.49k mining rigs — which were passed off as the Green „boxes“ and „nodes“ to investors.

Details of Allegation

The United States Securities and Exchange Commission said Green United’s operation was a fraud, with the community quick to quell fears of the SEC classing crypto mining as a security. The regulator filed a complaint in a Utah District Court on March 3 against Green United, its founder Wright Thurston, and contracted promoter Kristoffer Krohn alleging that they offered securities between April 2018 and December 2022 by selling investments in $3,000 “Green Boxes” and “Green nodes” purported to mine the GREEN token on “Green Blockchain”. Investors were told that this would increase their return up to 50% per month.

Reality of Scheme

However, what investors were promised is not what happened in reality. The actual scheme according to SEC’s complaint was using investor money to buy S9 Antminers—Bitcoin mining rigs—which were then passed off as “green boxes” or “green nodes” while they only mined Bitcoin instead of GREEN tokens that investors weren’t receiving anyway because Ethereum-based ERC-20 tokens can’t be mined on any blockchain yet due to lack of technical capabilities. Furthermore, there wasn’t even any existing Green Blockchain so it was impossible for anyone investing in this project get anything out of it whatsoever except losses from their investment money going into someone else’s pocket without them ever seeing any returns like originally promised .

Misinterpretation by Crypto Community

The crypto community took one interpretation from this case where it seemed like SEC was going after crypto miners arguing that selling miners or offering hosting for them is a securities investment contract but Timothy Peterson argued against this interpretation saying that this case does not target mining in general but rather targets frauds related specifically with GREEN tokens which falsely claimed returns up until 50% per month when there wasn’t even any existing blockchain for those tokens .

Conclusion

In conclusion , investing always carries some risk associated with it but if done right can give you big returns but buyers must beware before investing anywhere especially if there are too good claims being made with no proof backing those claims up . This should have been obvious with Green United’s scheme because if you think about it , how can something offer such high rewards so quickly without taking into account all factors involved? It’s best practice for potential investors to research thoroughly before making any investments into new projects so they don’t end up having their hard earned money stolen from them .

Trezor Producing Chips for Wallets to Optimize Supply Cycle

• Trezor announced that they are now producing their own silicon chips to optimize production and reduce lead times in the supply cycle.
• The move aims to protect customers from price fluctuations based on component supply and demand, while also responding quickly to demand-triggering events like the FTX collapse.
• Trezor does not expect its wallets‘ prices to be affected by this change.

Trezor Accelerates Chip Production

Hardware wallet manufacturer Trezor has announced that they will start facilitating the production of its key component, the chip wrapper, in its flagship product — the Trezor Model T. This move is intended to significantly optimize Trezor wallets‘ production, reducing lead times in the supply cycle from two years to several months.

Protects Consumers From Market Fluctuations

The new chip optimization will also eliminate delays in shipping finished products and protect consumers from exposure to price fluctuations based on component supply and demand. Demand for Trezor wallets spiked by at least 300% after the FTX collapse in November 2022 as crypto investors rushed to move their crypto holdings from centralized exchanges.

Specifications For New Chips

The new chips will be implemented exclusively for the firm’s Trezor T model, while other Trezor wallets will remain unaffected. A spokesperson for Trezor noted that „Model One“ has a different chip unaffected by the chip crisis“. It is planned that future models can all be equipped with the new chip.

Price Unaffected By Change

Trezor does not expect that the price of new wallets will be affected due to this change as it was noted that „the peak in chip prices is apparently ending“ so „our own chips are more or less the same price as mass-produced ones“. The significant benefit is that it allows them to handle any future potential chip shortage without increasing prices or delays in delivery.

Conclusion

Overall, this decision by Trezor should help reduce lead times and protect consumers from market fluctuations when sourcing components for their hardware wallets. They do not anticipate any changes in wallet prices either which should make customers feel more secure when purchasing their products.

Stablegains Sued for Misleading Investors on ‚Safe‘ UST Investment

• Stablegains is being sued in a California court for allegedly misleading investors and failing to comply with securities laws.
• The plaintiffs allege that Stablegains diverted all customer funds to Anchor Protocol without their knowledge or consent, and falsely advertised UST as a safe investment.
• The complaint also states that Stablegains failed to disclose that UST is a security, and did not register with the SEC either as a securities exchange or broker-dealer.

Stablegains Sued for Misleading Investors

Decentralized finance yield platform Stablegains has been sued in a Californian court for allegedly misleading investors and failing to comply with securities laws. On Feb. 18, plaintiffs Alec and Artin Ohanian filed a complaint in the U.S. District Court for the central district of California, alleging that the shuttered DeFi platform diverted all of its customer funds to Anchor Protocol without their knowledge or consent.

Stablegains Failing To Comply With Securities Laws

The plaintiffs allege that UST was a security and that Stablegains broke federal securities laws by failing to disclose this information and by not registering with the U.S. Securities and Exchange Commission either as a securities exchange or as a broker-dealer.

Anchor Protocol Offered Yields Of Up To 20%

Anchor Protocol offered yields of up to 20% on the Terraform Labs algorithmic stablecoin, Terra USD (UST). Stablegains offered a 15% gain for its customers, pocketing the difference from yields offered by Anchor Protocol.

UST Ecosystem Collapsed In May

The Ohanians stated that there were „disastrous consequences for Stablegains‘ customers,“ following the collapse of the UST ecosystem in May when UST de-pegged from the dollar, causing significant losses for users who had invested in it through Stablesgaines’s services.

Conclusion

In conclusion, this lawsuit alleges that Stablegains misled investors concerning investment safety protocols while diverting customer funds into Anchor Protocol without users’ knowledge or consent, breaking federal securities laws in multiple ways including failing to register with SEC as either an exchange or broker-dealer.

Coinbase to Defend Staking in US Courts: CEO

• Coinbase’s executives are standing up for its crypto staking services, claiming they cannot be classified as a security and threatening to bring the matter to courts in the US.
• Coinbase CEO Brian Armstrong promised that they will ‘defend this in court if needed’.
• According to Coinbase’s chief legal officer, Paul Grewal, staking is not a security under the US Securities Act or Howey test.

Coinbase Defends Staking Services

Coinbase’s executives are defending their crypto staking services, saying that it cannot be classified as a security and threatening to take it to courts in the United States if need be. In response, Coinbase CEO Brian Armstrong tweeted that they will „defend this in court if needed.“ The move follows an agreement between Kraken and the Securities and Exchange Commission on Feb 10th to stop offering staking services or programs to clients in the country.

SEC Claimed Kraken Failed To Register

The SEC claimed that Kraken failed “to register the offer and sale of their crypto asset staking-as-a-service program” which was now qualified as securities. Aside from halting said service, Kraken agreed to pay $30 million in disgorgement, prejudgment interest and civil penalties.

Staking Not A Security Under The US Securities Act

Coinbase’s chief legal officer, Paul Grewal weighed in on the issue with a blog post claiming that “staking is not a security under the US Securities Act nor under Howey Test“. He added further stating that trying to superimpose securities law onto such processes does not help consumers at all but instead makes them unable to access basic crypto services which also pushes users towards offshore, unregulated platforms.

Brian Armstrong’s Tweet

In response to this statement by Grewal, Brian Armstrong posted on Twitter “Coinbase’s staking services are not securities. We will happily defend this in court if needed” sending out an implicit message of assurance for those who use their service.

Kraken Agrees To Pay SEC Fine

Kraken agreed with SEC regarding offering unregistered Staking as a Service Program leading them paying $30 million fine including disgorgement prejudgment interest and civil penalties along with halting said service altogether

Bitcoin Clings to $23.5K as Bulls Refuse to Give Up

• Bitcoin clings to $23.5K as trader says BTC ‚identical‘ to 2020 breakout
• Market data from the US provides modest volatility but no overall trend change
• Traders are mixed on BTC’s longer-term outlook, with some expecting further gains and others expecting a pullback

Bitcoin Clings To $23.5K

Bitcoin (BTC) held steady around the $23,500 mark on Feb. 4 as bulls refused to give up support in out-of-hours trading. Macroeconomic data releases from the United States provided modest volatility but no overall trend change as traders bided their time heading into the weekend.

Mixed Longer-Term Outlook

Opinions on the longer-term outlook were mixed, with some maintaining that there was little reason to trust that Bitcoin’s rally would continue and others remaining optimistic about further gains. Popular trader Crypto Tony pointed out that „we have yet to complete a higher high and higher low market structure change“. Fellow trader Credible Crypto compared current BTC price action to late 2020 just after Bitcoin had passed its old 2017 all-time high, saying that „price action has developed beautifully off our lows“.

Wall Street Open

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD holding a narrow range in place since the Feb. 3 Wall Street open. Meanwhile, macroeconomic data releases from the United States provided modest volatility but no overall trend change as traders bided their time heading into the weekend.

Classic Bull Market Structures

Several sources point to classic bull market structures now in place on BTC price charts despite not everyone being bullish about the future of Bitcoin prices. Credible Crypto noted how current consolidation is identical to price action seen during a previous impulse from 10k – 60k+.

Final Thoughts

Whether or not Bitcoin will continue its pump remains to be seen, but traders are certainly watching closely for any signs of support or resistance at key levels like $22,765 or even $50,000 if got there eventually.

New York Assembly Introduces Bill to Accept Crypto as Payment

•The New York State Assembly has introduced Bill A523, which allows state agencies to accept cryptocurrency as a form of payment for fines, civil penalties, taxes, fees and other payments charged by the state.
•The bill does not obligate state agencies to accept crypto as payment, but it does clarify that state agencies can legally agree to accept such payments and that these agreements should be enforced by the courts.
•The bill was introduced by Democratic Assembly Member Clyde Vanel, who is often seen as a crypto-friendly politician.

On January 26th, the New York State Assembly introduced Bill A523, which could potentially revolutionize the way fines, taxes, fees, and other payments are collected by the state. The bill, which was introduced by Democratic Assembly Member Clyde Vanel, would allow state agencies to agree to accept cryptocurrency as a form of payment.

The legislation doesn’t mandate that agencies must accept crypto, but it does clarify that they can do so and that these agreements should be enforceable by the courts. This would represent a major step forward in legitimizing the use of digital currencies, which have long been seen as a risky and volatile asset class.

The introduction of the bill is a sign of the growing acceptance of crypto and blockchain technology among governments and institutions. It could also open the door to increased adoption of digital currencies as a payment method, which would provide greater access for individuals and businesses alike.

The implications of the bill could be far-reaching, as it would make it easier for people to pay fines, taxes, rent, and other obligations with a cryptocurrency of their choosing. This could make it easier for people to pay their debts, as well as make it simpler for state agencies to collect payments.

The bill is still in its early stages and will need to go through the legislative process before becoming law. If it is passed, it could be a major step forward for crypto and blockchain technology. It could also provide greater access to digital currencies and provide more opportunities for individuals and businesses to use them.

BlockFi’s Leaked Finances Reveal $1.2B in Assets Linked to SBF’s Failed Firms

• BlockFi’s secret financials were accidentally leaked, revealing that the firm had $1.2 billion in assets tied to Sam Bankman-Fried’s failed companies, FTX and Alameda Research.
• BlockFi is reportedly selling $160 million in Bitcoin miner-backed loans, with the proceeds going towards expanding its crypto lending services.
• BlockFi has also secured a $500 million round of funding from a consortium of investors.

BlockFi has had a tumultuous 12 months, having been caught up in the Terra fiasco and narrowly avoiding bankruptcy after receiving a $400 million lifeline from FTX US in July 2022. However, the company’s financials have recently been accidentally leaked, revealing that BlockFi has $1.2 billion in assets linked to Sam Bankman-Fried’s failed companies, FTX and Alameda Research.

In an attempt to distance itself from the FTX debacle, BlockFi is also reportedly selling $160 million in Bitcoin miner-backed loans, with the proceeds going towards expanding its crypto lending services. The company is also rumored to be in the process of securing a $500 million round of funding from a consortium of investors.

The leaked financials have revealed that BlockFi had $315.9 million worth of assets linked to FTX and $831.3 million in loans to Alameda as of Jan. 14. The documents also show that the company has been struggling to stay afloat in the aftermath of FTX’s collapse.

These leaked financials have caused a stir in the crypto lending community, as it is clear that BlockFi has been heavily exposed to SBF’s failed enterprises. This has raised questions about whether or not the company will be able to escape this mess unscathed.

BlockFi has attempted to distance itself from SBF’s companies, but it is clear that it will continue to be affected by the fallout from FTX’s collapse. The company has also failed to provide any details about the alleged $500 million round of funding that it is reportedly in the process of securing.

It remains to be seen whether BlockFi will be able to weather the storm and continue to provide crypto lending services. For now, the company will have to continue to deal with the aftermath of the FTX fiasco and its exposure to Sam Bankman-Fried’s failed enterprises.