23 November

“Amid concerns over the health and future of Digital Currency Group (DCG) following the collapse of crypto exchange FTX, company CEO Barry Silbert told shareholders of the crypto conglomerate that while it owes its own Genesis Trading arm $575 million, the firm aims to emerge “stronger” from the crypto winter.

Silbert said in the letter to investors, that the $575 million worth of intercompany loans are due in May 2023, and that DCG took out the loans like any other crypto firm would. Loan funds were used towards investments and also to repurchase DCG stock from non-employees, Silbert wrote.

DCG also owes Genesis $1.1 billion on a promissory note due in June 2032 related to the default of Three Arrows Capital. Silbert said that DCG is on track for $800 million in revenue in 2022, a dip of about 20% from last year, and told shareholders that ‘we will let you know if we decide to do a financing round.’

Genesis leadership and their board decided to hire financial and legal advisors, and the firm is exploring all possible options amidst the fallout from the implosion of FTX.

Let me be crystal clear: DCG will continue to be a leading builder of the industry and we are committed to our long-term mission of accelerating the development of a better financial system. We have weathered previous crypto winters, and while this one may feel more severe, collectively we will come out of it stronger.”

See Also: Genesis Global Capital Has Hired Investment Bank Moelis to Explore Options Including Bankruptcy: New York Times
See Also: Gemini Still Working With Genesis, Digital Currency Group to Unlock Earn User Withdrawals
See Also: Cathie Wood’s Ark Invest Buys $1.5M in Grayscale Bitcoin Trust Shares
See Also: Binance Cites Conflict of Interest for Passing on Genesis Investment: Report

“‘You have witnessed probably one of the most abrupt and difficult collapses in the history of corporate America,’ an attorney for FTX said during the company’s first bankruptcy hearing in Delaware on Tuesday. There are over 100 different debtors tied to the FTX group that filed for bankruptcy.

Bromley described the FTX empire – at its height valued at $32 billion – as the ‘personal fiefdom of Sam Bankman-Fried.’ The lawyer told the court that Bankman-Fried and a small group of executives ran the company ‘with a lack of corporate controls that none of us in the profession … have ever seen.’

FTX was in the control of a small group of inexperienced and unsophisticated individuals, and unfortunately, the evidence seems to indicate that some or all of them are also compromised individuals.

A substantial amount of [FTX’s] assets have either been stolen or are missing.

The attorney questioned some of FTX’s expenditures, saying that one of the U.S. entities spent around $300 million on real estate in the Bahamas – homes and vacation homes for members of FTX’s leadership team.

The new team at FTX, including new CEO John Ray III, has “assembled a team of investigators,” which includes former enforcement officials with the Securities and Exchange Commission, Commodity Futures Trading Commission and former prosecutors, Bromley said. FTX has also retained crypto analytics firm Chainalysis to help it investigate the company’s holdings.”

See Also: FTX Bankruptcy Filing: ‘No Amounts’ Will Be Paid to SBF or His Inner Circle
See Also: Bahamas FTX Liquidators Agree to Transfer Bankruptcy Case to Delaware
See Also: Singapore central bank explains why Binance was on its alert list, but FTX wasn’t

The various divisions of Sam Bankman-Fried’s crumbling set of companies have $1.2 billion in cash as of Nov. 20, far below the $3.1 billion it owes its top 50 creditors, court documents show.

About $751 million of that is held in debtor entities and the rest, $488 million, is in non-debtor entities, according to the document. About $514 million is unrestricted cash, $260 million is custodial and $465 million is restricted cash, which is earmarked for specific purposes like loan repayments and can’t be use for general business purposes. It may have more than 1 million creditors, and owes the 50 largest about $3.1 billion.

Alameda Research has the largest reserve of cash out of the various entities at $393 million, while FTX Japan has the largest reserve of cash at $171 million of firms under the FTX silo. The Japanese crypto exchange has reportedly said it is preparing to restart withdrawals by the end of the year.”

See Also: ‘Substantial amount’ of FTX’s assets stolen or missing — Bankruptcy counsel

“Alexey Pertsev has been ordered to stay in jail until Feb. 20 after a Netherlands court found the Tornado Cash developer represented a flight risk. Pertsev has been held in detention since August, days after the U.S. Treasury used sanction powers against the Tornado protocol.

At the hearing on Tuesday, Dutch public prosecutor Martine Boerlage announced money-laundering charges for the first time. Boerlage has accused Pertsev of facilitating the processing of dirty money by writing the Tornado Cash code.

Boerlage also denied claims that the software was autonomous, saying that Pertsev and others had de facto control. Pertsev, Semenov and Storm may have held so many tokens for the protocol they could in practice ‘always outvote everyone elsewhen it came to decision making, Boerlage added.

Pertsev’s lawyer, meanwhile, argued that the service had legitimate uses. ‘The goal of Tornado Cash is to bring privacy for the user, giving the user control over crypto transactions,’ Cheng said. The prosecution had not convincingly demonstrated specific facts linking Pertsev to the alleged crime as required by Dutch and European law, Cheng added.

It’s clear to us that these judges are not as familiar with the subject matter as they should be. At the moment, the case law regarding criminal activities is all about bitcoin mixers … It’s very important that the court understands that Tornado Cash is something different.

Pertsev’s arrest and detention has drawn widespread outcry, including protests in Amsterdam and a tweet from Edward Snowden comparing Pertsev’s treatment to the kid gloves afforded to executives at collapsed crypto exchange FTX.”

See Also: Mango Exploiter’s Funds Get Liquidated After Roiling Aave Using $20M of Borrowed Curve Tokens

“There’s a common theme underlying the year’s biggest crypto blowups. From 3AC and Celsius to FTX (and perhaps soon Genesis?) — plenty of centralized crypto entities have been blowing up and leaving users holding the bag.

Amid the recent FTX-driven turmoil in crypto’s centralized finance sector, the top DeFi projects on Ethereum have been trodding along just fine. These battle-tested decentralized protocols show us the power of being able to personally manage your own money onchain without having to worry about corrupt intermediaries like FTX’s leadership.

Accordingly, this Bankless tactic will walk you through the best ways to take control of your crypto by doubling down on DeFi using the most proven dapps available today.”

Sales for the Saudi Arabia-themed non-fungible token (NFT) collection called “The Saudis” increased 387% on Tuesday following the country’s surprise 2-1 win against Argentina, which is considered one of the best soccer teams in the world. Argentina’s fan token (ARG), in contrast, dropped 21% over the past 24 hours.

Crypto tokens have become popular among gamblers in this year’s World Cup. Chiliz (CHZ), the native token of the Chiliz blockchain that powers Socios.com, the largest sports fan token creator platform, surged 39% in the week before the start of the competiton.”

See Also: Ethereum Metaverse Game The Sandbox to Launch LAND Sale With Playboy, Tony Hawk, Snoop Dogg