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Gm! Never a boring week in crypto. But this time, it’s different. It’s dark. Where do I even start? And how do I even explain?
What’s Happening in Web3
Let’s begin the show…
1. SBF, What Have You Done??
It all started with a Billionaire (CZ – CEO of Binance) tweeting that he is gonna dump the tokens of his competitor (SBF’s FTX Exchange) because SBF has been talking things about them with the regulators in a way that would prove detrimental for Binance.
And here we are, with FTX filing chapter11 bankruptcy, Sam saying sorry multiple times for trading with customer funds which he should not have done in the first place, thereby losing customer funds (billions of dollars) and his wealth (negative?). By filing for Chapter 11 bankruptcy, the company can continue operating, while restructuring its debts under court supervision.
- SBF is tied to more than 130 companies. The post FTX collapse effects are gonna be severe.
- At least $1 billion of client funds missing at failed crypto firm FTX.
- Is $CRO (crypto.com) is gonna be fine? Who knows!!
- After the bankruptcy, FTX got hacked. Crazy, right?
- 10% of Multicoin AUM is stuck on FTX.
- Genesis declares $175 million exposure to FTX.
- Ontario Teachers Fund Sank $95M in Failed FTX Empire
- SBF tweeted ‘what’ after $10 billion+ in lost funds, a suspicious hack on a Friday night and reports of SBF attempting to flee.
- And his contributions in politics…, also linked to Ukraine.
- “Alameda CEO Caroline Ellison said that she, Mr. Bankman-Fried, and two other FTX executives, Nishad Singh and Gary Wang, were aware of the decision to send customer funds to Alameda.”
- Huobi announced $18.1 million in crypto cant be withdrawn on FTX- $13.2m are customer assets.
- Securities Commission of the Bahamas freezed FTX’s assets.
- SBF lives in a $35m house & owns $200m+ of land in the Bahamas
- Why would FTX acquire Voyager and BlockFi if they had no cash and were insolvent?
- Is Gary Gensler linked to this who FTX – Alameda thing?
- The SEC will try to punish US companies for this collapse?
- Elon Musk: He set off my bs detector, which is why I did not think he had $3B.
- FTX chief regulatory officer Daniel Friedburg has a sketchy past?
Finally: Ponzi Scheme. Highly leveraged loans. Money Laundering. Hacking?…… Steady lads, deploying more chaos!!
2. Royalties are SAFU?
We all know about the ‘Optional Royalities’ shit that many NFT marketplaces are adopting where buyers will have the option to pay or not pay a royalty on the purchase.
Now, to protect your NFTs from not being paid royalties, Nifty Gateway introduced Creator Royalty Standard & Coalition.
That’s not the only news!!
Opensea, the largest Ethereum NFT marketplace came up with an on-chain enforcement tool. It is a snippet of code that NFT creators can add when building their smart contracts that will ensure they continue to receive a cut of the proceeds every time an NFT exchanges hands.
And…”We will continue to enforce creator fees on all existing collections” – OpenSea.
SuperRare says royalties have always been a core part of their inspiration since day one.
3. How To Die IRL?
But why create such a thing in the first place? IDK!!
4. Updated Sanctions on Tornado Cash
The U.S. Treasury imposed new sanctions on Tornado Cash, alleging its use by the North Korean government.
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) redesignated Tornado Cash, citing “its role in enabling malicious cyber activities, which ultimately support the DPRK’s [Democratic People’s Republic of Korea] WMD [weapons of mass destruction] program.”
Basically, nuclear weapons.
5. $400M Mistake
All the funds are returned. On another note, the firm’s native token $CRO, is now down more than 50% for the week.
Imagine sending those funds to me accidentally.
6. 3.4 Billion Freaking Dollars of BTC
Department of Justice seizes $3.36 billion Bitcoin in connection with the Silk Road fraud. Yes, that’s Billion with a ‘B’.
This man James Zhong transferred at least approximately 50,000 Bitcoin from Silk Road’s (darknet market) Bitcoin addresses into Individual-1’s own addresses, without ever providing any goods or services in return. Here is a thread explaining the full story.
US Government Now Has More BTC Than Largest Crypto Holders.
- In February, a New York couple was indicted for stealing about 120,000 BTC, much of which was recovered by law enforcement.
- Another Silk Road-related seizure in November 2020 netted the government 70,000 BTC.
- Previously, seized assets have been auctioned off to various bidders. Most notably, in 2014, venture capitalist Tim Draper purchased 30,000 bitcoins for an undisclosed amount.
7. Chainlink – Proof Of Reserve Product
Chainlink launched a new proof-of-reserve product.
Can it prevent future crypto exchanges collapse?
“We’re in conversations with a majority of the top exchanges and everyone else who can benefit from this. The demand for proof-of-reserves have 10x’d.” – Sergey Nazarov (co-founder of Chainlink).
8. Net Deflationary Ether
Ethereum hit the much-anticipated milestone of zero net issuance, 54 days after it the network transitioned to proof-of-stake consensus.
What does that mean? Ether’s net issuance turns negative. On Nov 9th ETH has become net deflationary since the Merge.
9. Market Overview
The global crypto marketcap fell below $900B this week, because of the FTX collapse. Bitcoin fell below 16000$ for the first time since 2020. And ETH fell below $1100.
- Bitcoin: -17%
- Ethereum: -17%
- Polygon: -22%
- Solana: -53%
- BNB: -13%
- El Salvador is now down 60% on its bitcoin holdings, from $105 billion to $41 billiom, per Bloomberg.
- “We’re excited about bitcoin [because] it’s something greater than all of us. We’re actually buying into a protocol which is spreading all across the earth to solve a problem.” – Michael Saylor.
- The SEC won its case against LBRY, after charging it with offering its LBC tokens as unregistered securities in 2021.
- Coinbase is laying off more than 60 staff in its recruiting and institutional onboarding departments, The Information reported Thursday.
- Meta (formerly Facebook) fired 11,000 employees. It is also set to extend hiring freeze.
- According to MevWatch, the Ethereum network was found to enforce OFAC compliance on over 73% of its blocks.
- Google Cloud announced plans for building a block-producing Solana validator to participate in and validate the network.
- Bitcoin hit $16K this week. All thanks to FTX drama. On Nov 10th, 2021, Bitcoin reached an all-time high of $69,044. A year later, on the same day, here we are.. Another fun fact: Microstrategy’s paper loss on Bitcoin crossed $2B.
- Sequoia Capital to mark down its $213.5 million FTX investment to $0.
- Galaxy Digital revealed a $76.8 million exposure to FTX, $47.5 million of which is “in the withdrawal process.”
- Rolex announced they are entering the metaverse with their new NFT trademark application.
- Crypto lender BlockFi paused withdrawals post FTX drama.
- MetaMask launched MetaMask Bridges, a bridge aggregation service that allows users to transfer their assets across multiple blockchains from within the wallet.
- Tether, the issuer behind the No. 1 U.S. dollar-backed stablecoin, USDT, froze almost $47M worth of USDT held by FTX exchange on the Tron blockchain.
- Polygon co-founders Anurag Arjun and Mihailo Bjelic recently confirmed that engineers who contribute to the chain are attempting to turn it into a “true L2” also known as a rollup.
- 20% of all reserves at one of the world’s top crypto exchanges crypto.com are held in the highly speculative memecoin shiba inu (SHIB).
- 3,500 “Sleeping Bitcoins” from 2011 worth more than $60 Million awaken.
Numbers Of The Week
Polygon has added 43M unique wallet addresses in the last 5 months.
Avalanche’s NFT sales improved by 180% in the last quarter.
SBF transferred at least $4B to Alameda Research after suffering losses from deals in May and June.
- Wait, what? Binance went to war with FTX, announced they are selling a whole bunch of FTT tokens, caused a bank run, market crashed, investors panicked, now CZ is buying the whole company and it’s just a Tuesday. Did I get this right? [Aleksandra Huk]
- FTX broke. Binance offering a bailout. FTT down -75%. Do Kwon on UpOnly. BitBoy claiming to have ended Sams career. Su Zhu tweeting for the first time in 5 months. All in less than 24 hours. I won’t say it can’t be beaten but holy shit this day has been something else. [Cold Blooded Shiller]
- SBF the public figure deserves what it’s getting and it’s even healthy to have a good dunking session to reaffirm important community values. Sam the human being deserves love, and I hope he has friends and family that can give it to him. [Vitalik Buterin]
- Collectively cause hundreds of billions of losses for the everyday investor? Feel free to still shitpost on twitter and go to the beach. Write some code that allows people to preserve their privacy? Straight to jail (without charge). [sassal.eth]
- A quick guide on MEV
- The Binance – FTX War
- Ethereum Basics: Accessing the World Computer
- What happens from here, and what it means for this industry (Post FTX Collapse)
- Everything you need to know about Alameda Research and the collapse of FTX
- Why Ethereum Is More Decentralized After the Merge
- 134 of FTX’s firms filed for bankruptcy
- Ethereum embodies 6 values embedded in US ideals
- Possible Airdrop for MetaMask users
- A personal rant on investing by Polynya
- Web3 Isn’t Taking Privacy Seriously Enough
- Why DeFi > CeFi in terms of financial stability and resilience?
- Beware of this NFT scam
Do You Know?
$1.5 BILLION were stolen from cross-chain bridges in 2022.
Meme Of The Week 😂
Disclaimer: None of this is financial advice. This newsletter is strictly educational and is not investment advice. Please be careful and always do your own research.