Future Timeline

Crypto lender BlockFi files for bankruptcy, cites FTX exposure

Source: Reuters

Nov 28 (Reuters) - Cryptocurrency lender BlockFi has filed for Chapter 11 bankruptcy protection, it said on Monday, the latest crypto casualty after the firm was hurt by exposure to the spectacular collapse of the FTX exchange earlier this month. The filing in a New Jersey court comes as crypto prices have plummeted. The price of bitcoin , the most popular digital currency by far, is down more than 70% from a 2021 peak.

“BlockFi’s Chapter 11 restructuring underscores significant asset contagion risks associated with the crypto ecosystem," said Monsur Hussain, senior director at Fitch Ratings. New Jersey-based BlockFi, founded by fintech executive-turned-crypto entrepreneur Zac Prince, said in a bankruptcy filing that its substantial exposure to FTX created a liquidity crisis. FTX, founded by Sam Bankman-Fried, filed for protection in the United States earlier in November after traders pulled $6 billion from the platform in three days and rival exchange Binance abandoned a rescue deal.

"Although the debtors’ exposure to FTX is a major cause of this bankruptcy filing, the debtors do not face the myriad issues apparently facing FTX," said the first day bankruptcty filing by Mark Renzi, managing director at Berkeley Research Group, the proposed financial advisor for BlockFi. "Quite the opposite." BlockFi said the liquidity crisis was due to its exposure to FTX via loans to Alameda, a crypto trading firm affiliated with FTX, as well as cryptocurrencies held on FTX's platform that became trapped there. BlockFi listed its assets and liabilities as being between $1 billion and $10 billion.

Renzi said that BlockFi had sold a portion of its crypto assets earlier in November to fund its bankruptcy. Those sales raised $238.6 million in cash, and BlockFi now has $256.5 million in cash on hand. In a court filing on Monday, BlockFi listed FTX as its second-largest creditor, with $275 million owed on a loan extended earlier this year. It said it owes money to more than 100,000 creditors. The company also said in a separate filing it plans to lay off two-thirds of its 292 employees.

Read more: https://www.reuters.com/technology/cryp ... 022-11-28/

Crypto Probably Isn’t Dead, but Should It Be?
by Emily Stewart
November 29, 2022

Introduction:

(Vox) It would be easy to write crypto’s obituary right now. The technological ecosystem has never quite managed to justify the logic of its existence or reach the mass adoption its boosters have promised for years. The latest crypto winter is turning into the crypto ice age, with company after company appearing to be in trouble and, at the very least, facing questions about their stability.

Months of turmoil in the space have culminated in the spectacular implosion of crypto exchange FTX and the incredible downfall of its founder, Sam Bankman-Fried. His business operations have been revealed to be a disaster, and Bankman-Fried as a deeply unserious person and potential fraudster.

According to a count from the website Web3 is Going Just Great, $12 billion have been lost to intentional crypto grifts and scams. That count doesn’t include the $8 billion that appears to have been lost by Bankman-Fried, not to mention other recent high-profile collapses. (Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.)

For those who have been paying attention to the sector, this sort of feels like waking up from a worldwide hypnosis. The metaverse thing, which is basically Zoom meetings with legless cartoons, never made sense. Neither did this idea that images of pixelated punks and weird-looking monkeys were worth millions of dollars as NFTs. Thousands of crypto tokens and coins spun up out of thin air have been revealed to be nothing more than magic beans. Project after project has fallen apart, often taking customers’ money with them, and then there’s the multitude of outright crypto scams.

Crypto isn’t just a financial space where the line goes up and the line goes down; it’s also a place where the line goes poof! and disappears.

Read more here: https://www.vox.com/the-goods/2022/11/ ... -coinbase

Same here within the UK, like Caltrek's comment in March with the US.

UK to Launch Government-Backed ‘Digital Pound’ for Central Bank Digital Currency

December 12, 2022 by Save Britain

The Bank of England has started consultations on implementing a Central Bank Digital Currency (CBDC), which could usher in the globalist vision of a cashless society where all transactions are traceable by the government, according to an announcement made this week by the de facto head of His Majesty’s Treasury.

Chancellor of the Exchequer Jeremy Hunt announced that the Bank of England will start consultations on the design of a Central Bank Digital Currency (CBDC), which would serve as a digital equivalent of the pound sterling, as part of his “Edinburgh Reforms” of Britain’s financial services.

Hunt said in a written statement to Parliament that the government will begin “bringing forward a consultation in the coming weeks to explore the case for a central bank digital currency – a sovereign digital pound – and consult on a potential design.”

“The Bank of England will also release a Technology Working Paper setting out cutting-edge technology considerations informing the potential build of a digital pound,” he added.

In contrast to Bitcoin, which functions on a decentralised basis in which no single person can control its functions, ownership, or value, a CBDC would be similar to traditional fiat currency issued by a central bank, such as the Bank of England, and therefore could suffer from the same inflation issues if the central bank decided to issue more of it — like printing cash

.

https://savebritain.org/uk-to-launch-go ... -currency/

This would make it easier for the government to spy on you on every little thing you buy from food to technology in digital form.

FTX collapse shows crypto is 'too dangerous' not to regulate, Bank of England deputy governor says

In an exclusive interview with Sky News, Sir Jon Cunliffe says investors and the financial system need protection from the "casino" of crypto trading.

Friday 23 December 2022 08:06, UK

Cryptocurrency trading is "too dangerous" to remain outside mainstream financial regulation and could pose "a systemic problem" without action, the deputy governor of the Bank of England has warned.

Speaking for the first time since the founder of the crypto trading platform FTX was arrested and charged with massive fraud, Sir Jon Cunliffe told Sky News the Bank is considering regulation to protect retail investors in the "casino" of crypto trading, as well as the wider financial system from potential crypto shocks.

Sam Bankman-Fried was extradited on Wednesday from the Bahamas to the US where he will appear in a New York court charged with eight counts of fraud, money laundering and breaking campaign finance.

The collapse of FTX left more than one million customers unable to withdraw assets worth an estimated $8bn.

Prosecutors allege he used FTX's customers' money to cover losses in his private crypto hedge fund Alameda Capital in what the company's new chief executive told Congress was "old-fashioned embezzlement".

https://news.sky.com/story/ftx-collapse ... s-12773169

ººº wrote: ↑Fri Feb 03, 2023 3:55 pm

...and another one bites the dust...

Do Kwon: US regulator charges cryptocrash boss with fraud

7 hours ago

US financial regulators have charged failed South Korean cryptocurrency boss Do Kwon and his company Terraform Labs with "orchestrating a multi-billion dollar crypto asset securities fraud".

The Singapore-based firm created the Terra Luna and TerraUSD tokens, which collapsed spectacularly last year.

The collapse is estimated to have cost investors more than $40bn (£33.5bn).

Mr Kwon and Terraform Labs did not immediately respond to a BBC request for comment.

"We allege that Terraform and Do Kwon failed to provide the public with full, fair, and truthful disclosure as required for a host of crypto asset securities, most notably for LUNA and Terra USD," US Securities and Exchange Commission (SEC) chairman Gary Gensler said in a statement.

https://www.bbc.co.uk/news/business-64671745

NFTs are Down, but They're Not Dead
by Brady Dale
February 21, 2023

Introduction:

(Axios) The market for NFTs has gotten smaller. But it hasn't died.

Why it matters: Despite the societal and media urge to eulogize the fall of any once-big thing, more than $480 million worth of NFTs exchanged hands in the past 30 days. Perhaps more importantly, the market is changing in a fundamental way.

The big picture: From the beginning of the NFT (lesser known as "non-fungible tokens") boom in early 2021, the issue that's held the marketplace back has been liquidity.

• It's hard to truly know an asset's "value" when a person can't sell it quickly when they want to.

• Lately one marketplace, Blur, has been trying to change that, catering to people making a living day trading NFTs.

Read more here: https://www.axios.com/2023/02/21/nft-market-frenzy

Do Kwon: Fugitive 'cryptocrash' boss arrested in Montenegro

2 days ago

South Korea police say that Do Kwon, the fugitive cryptocurrency boss behind the $40bn (£32.5bn) collapse of the terraUSD and Luna tokens, has been arrested in Montenegro.

He has since been charged with fraud by prosecutors in the US.

Earlier this year US regulators accused Mr Kwon and his company Terraform Labs of "orchestrating a multi-billion dollar crypto asset securities fraud".

The firm did not immediately respond to a BBC request for comment.

South Korea authorities issued an arrest warrant for Mr Kwon last September as they believed Terraform Labs had violated capital market rules.

https://www.bbc.co.uk/news/technology-65058533



Reuters

This Telegram Bot is Crypto's Silver Lining
by Brady Dale
September 14, 2023

Introduction:

(Axios) Telegram is infested with bots, and that's the good news — at least for true believers in cryptocurrency looking around for anything to feel good about.

Driving the news: Unibots is one of a small handful of Telegram trading bots that are seeing profits, excitement and value creation (for now).

• Yes, but: These kinds of platforms all tend to be run by anonymous teams, because they are non-compliant and likely quite risky.

In short: These bots make it really easy to trade crypto on your phone. They even enable complex trades, like limit orders, copy trading (doing anything a successful trader does) or even scam insurance.

Read more here: https://www.axios.com/2023/09/14/crypt ... ram-bot

Criminal Activities Cause Losses of $30 Billion in the Crypto Sector
October 16, 2023

Introduction:

(Eurekalert) Digital financial products are increasingly coming under the crosshairs of cyberattacks. However, evidence-based results are not yet available regarding the actual magnitude of this threat. Researchers from the Complexity Science Hub and the University of Montreal have now, for the first time, shown that the global damage amounts to at least $30 billion and is on the rise. A preprint of the study was recently published on arXiv.

Decentralized Finance (DeFi) represents a new financial paradigm where financial services, such as lending, are offered through decentralized computer programs running on so-called blockchains. It's well-known that numerous criminal attacks occur in this space. However, "since there is no central point of contact for criminal cases, evidence-based statements about the total damage could not be made until now," explains Bernhard Haslhofer, head of the Cryptofinance research group at the Complexity Science Hub.

AT LEAST 1,155 CRIMINAL INCIDENTS

Therefore, the researchers have now compiled documented criminal incidents in the crypto sector from various databases for the first time. In doing so, they identified a total of 1,155 criminal events from 2017 to 2022. "But this doesn't mean there couldn't be more cases. Accordingly, all our results are minimum values," emphasizes Haslhofer. The resulting total damage: $30 billion, roughly equivalent to Luxembourg's state revenue in 2022.

These 1,155 cases might not be the whole picture, but they constitute one of the most extensive set of events analyzed to date, which represents the first step towards assessing the size and scope of the DeFi crime landscape,“ says Catherine Carpentier-Desjardins of the University of Montreal.

Conclusion:

WHERE DOES THE MONEY GO?

This study shows where attacks are most likely to occur and the extent of the damage. However, tracking the money trail in the DeFi sector is currently extremely difficult. That's why the "DeFi Trace" project is currently underway at the Complexity Science Hub, led by Bernhard Haslhofer. "Over the course of two years, we aim to develop methods to automatically trace illegal payment flows in the DeFi sector, thereby containing criminal activities," says Haslhofer.

Read more here: https://www.eurekalert.org/news-releases/1004782

Bitcoin has reached all-time high prices in both Turkey and Nigeria, reflecting the growing popularity of cryptocurrency in these countries. The high prices are likely due to a number of factors, including inflation, economic instability, and increasing awareness of Bitcoin. When I read about inflation, I am scared, but I don't worry because I check trustful reviews on https://casinosanalyzer.com/bonuses-by-countries/united-states-usa to get advantaes about the best offers. I read about the best USA no deposit bonus codes to use them and win while playing my favorite games.

Putting it out there that cryptocurrency is about to enter another bull run. Ethereum is still the best bet in terms of risk and returns imo. It's the only major blockchain that actually has a revenue model (selling blockspace) and is generating profit. In terms value settled daily it settles in the realm of 20-30 billion dollars a day on average whereas bitcoin is only settling 2-4 billion. Price targets are anywhere from 8-12kish based on diminishing returns from the last 2 market cycles.

I think this will be bitcoins last bull market before entering a multi-cycle secular bear market that may genuinely send it to zero. Bitcoin has major miner extractable value (MEV) flaws in its economic model that the bitcoin community is unwilling to recognize even exist. They will become pronounced by around 2030 and there is no narrative to carry bitcoin after ETF approval. Hyperbitcoinization isn't happening for a variety of reasons.

The MEV problem is complex and people write whole research papers about it. Here's a good one.

https://www.cs.princeton.edu/~arvindn/p ... ng_CCS.pdf

I won't claim to understand all the math but from what I do understand the root of the problem lies in bitcoin's declining block rewards. Every four years bitcoin's block rewards halve and the market right now loves it, it's core to bitcoin's value proposition to most people. Halving block rewards reduces bitcoin's inflation rate and thus new supply entering the market which has an upward pressure on bitcoin's price. The problem is that block rewards also pay miners to secure the network and those miners need payed more and more to keep up with bitcoin's increasing computational demands in order to stay solvent. With less bitcoin being payed out, and higher costs overall, the only way for miners to stay solvent is if the price of bitcoin rises proportionally to the halving in block rewards every 4 years, or... to "cheat."

Relying on block rewards has worked so far, but bitcoin can't go up in price like this forever unless it genuinely does replace every national currency on Earth which isn't going to happen for reasons I don't feel like I need to convince this community of. The hard limits of this growth are going to be apparent over the next 8 years imo. Some people have the crises point pegged farther along around 2040, but let's be honest, does anyone here actually see bitcoin being worth $500,000-$1,000,000 by 2028? Because I don't, and it doesn't match up with the diminishing returns of bitcoin's current market structure, and that is the kind of price that will be needed around then in order to maintain security of the network.

So what actually happens when bitcoin can't keep growing and its security is compromised? That paper I posted goes into different ways malicious miners will be financially incentivized to attack the network. 51% attacks to reorganize the blockchain, which, would allow miners to take funds from other people's wallets by redirecting their transactions to their own wallets. MEV on transactions will also allow miners to extract rent from people transacting on the network by taking extra fees beyond the one's the protocol defines. The situation gets bad pretty fast. I would not be surprised to see bitcoin trading at under $10,000 in 2030 and under $1,000 in 2040. The MEV problem will create a death spiral as capital flees out of the ecosystem or to another blockchain with a secure network. It's important to note though, this will not be a fast process, there's still enough room in the model for bitcoin to appreciate in value over the next year or so and there are some stopgap measures like increasing transaction fees that the bitcoin devs will likely attempt.

I don't expect the bitcoin community to be able to ideologically accept major changes to the protocol or giving up on the halving process though. Bitcoin could fork into a different consensus protocol like ethereum did, but it won't. The bitcoin community died when it refused to increase blockspace size back in 2017 and has only ossified more since. That's a whole different technical debate from years past but in essence the bitcoin community believes their economic model works when it doesn't and has refused to upgrade the network for years which is causing death by stubbornness. Once enough miners are attacking the network with regularity people's trust in bitcoin will reach a tipping point that I think will cause bitcoin to enter a market crash it never recovers from.

Not just SBF: seven other crypto icons who fell in 2023

December 25, 2023 at 8:00 AM

They were billionaires. They were megastars.

They were the very best their generation had to offer, and they vowed to revolutionise the world of finance and money itself.

But crypto can be slippery and when the boom of 2021 gave way to the hard reality of a bear market, many of the industry’s icons fell.

In 2023, a legal reckoning followed the financial fallout, and criticisms that had long been levelled at the digital assets industry — theft, money laundering, fraud — became actual charges, verdicts, and guilty pleas.

Here’s a roll call of eight crypto figures who are spending their holidays behind bars or out on bail awaiting trial, or sentencing.

https://www.dlnews.com/articles/people- ... l-in-2023/



Sam Bankman-Fried is one of many crypto icons that faced a legal reckoning in 2023. Credit: Andrés Tapia

wjfox wrote: ↑Thu Dec 28, 2023 11:37 am Not just SBF: seven other crypto icons who fell in 2023

December 25, 2023 at 8:00 AM

They were billionaires. They were megastars.

They were the very best their generation had to offer, and they vowed to revolutionise the world of finance and money itself.

But crypto can be slippery and when the boom of 2021 gave way to the hard reality of a bear market, many of the industry’s icons fell.

In 2023, a legal reckoning followed the financial fallout, and criticisms that had long been levelled at the digital assets industry — theft, money laundering, fraud — became actual charges, verdicts, and guilty pleas.

Here’s a roll call of eight crypto figures who are spending their holidays behind bars or out on bail awaiting trial, or sentencing.

https://www.dlnews.com/articles/people- ... l-in-2023/



Sam Bankman-Fried is one of many crypto icons that faced a legal reckoning in 2023. Credit: Andrés Tapia

Update on this: -

Sam Bankman-Fried: Disgraced 'crypto king' jailed for 25 years after stealing billions of dollars from FTX customers

Thursday 28 March 2024 19:00, UK



Disgraced crypto entrepreneur Sam Bankman-Fried has been sentenced to 25 years in prison after being convicted of stealing billions of dollars from his customers.

He was the chief executive of FTX, which suddenly went bankrupt in November 2022 - leaving millions of users frozen out of their accounts and unable to make withdrawals.

The 32-year-old American could have faced up to 100 years behind bars - but last month, his lawyers argued such a sentence would have been "barbaric" and a five-year term would be more appropriate.

Initial reports said he had been sentenced to 20 years - but this has since been corrected to 25.

Prosecutors had asked the judge to jail Bankman-Fried for 40 to 50 years, arguing the public needed protecting from the fraudster and a harsh punishment would deter other criminals.

https://news.sky.com/story/sam-bankman- ... s-13103158