FTX collapse – pressnews

4Jan

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Technology

Beware the Dangers of Crypto Regulation

[ad_1] With so many unknowns and the risks of contagion mostly contained, the best policy right now is caution. The collapse of FTX and the charges against Sam Bankman-Fried have brought many renewed calls for crypto regulation, from both commentators and legislators. That is precisely why this is a time for caution. No matter how strong the temptation, we should not overregulate. Begin with two central facts. First, there are numerous ways for small and large investors to lose their money, including by investing in risky equities. Regulating crypto won't end that danger. Second, despite being one of the largest financial frauds in history, FTX has not created systemic financial risk, which should be the main concern of regulators. And market forces already have made the risk from ...

Binance, Alone at the Top After FTX, Stirs ‘Too Big to Fail’ Crypto Worry

18Dec

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Binance, Alone at the Top After FTX, Stirs ‘Too Big to Fail’ Crypto Worry

[ad_1] The death spiral of Sam Bankman-Fried’s empire bolsters the dominance of Changpeng Zhao’s exchange and amps up potential dangers for the entire sector. Now that Sam Bankman-Fried's fall from grace is complete, uneasiness is growing around the dominance that his rival Changpeng Zhao's Binance holds in the cryptocurrency market. The worries surfaced again on Friday as the accounting firm Mazars Group halted work for Binance and other crypto firms on reports that are meant to demonstrate that the companies hold the necessary reserves needed to cover any potential surge of customer withdrawals. Zhao, who goes by his initials CZ, has insisted repeatedly that Binance doesn't misuse customer funds like FTX allegedly did and that his exchange can process whatever amount of withdra...

The FTX Crypto Victim Card Can Be Hard to Play

16Dec

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The FTX Crypto Victim Card Can Be Hard to Play

[ad_1] Blaming Sam Bankman-Fried is convenient cover for some firms that should have known better. The crypto industry has suffered many booms and busts in its brief lifespan, but nothing like this. Sam Bankman-Fried, currently sitting in a Bahamian jail, has been accused by the US securities regulator of orchestrating a years-long fraud that diverted billions in customer funds from opaque and offshore exchange FTX to a now-bankrupt trading empire. The outrage among FTX's roughly 1 million creditors is understandable, as is the skittishness of investors yanking money from other crypto platforms like Binance. Bankman-Fried has tried to present himself as a naive 30-year-old who got out over his skis, but each day brings new reports of elaborate internal tools used to support the pro...

Crypto Lender Amber Scraps Bonuses, Cuts Jobs as FTX Collapse Turmoil Continues

15Dec

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Crypto Lender Amber Scraps Bonuses, Cuts Jobs as FTX Collapse Turmoil Continues

[ad_1] Amber Group, one of Asia’s biggest trading and lending platforms for digital currencies, has canceled this year’s staff bonuses as the one-time industry darling grapples with the crypto downturn. Amber Group, one of Asia's biggest trading and lending platforms for digital currencies, has canceled this year's staff bonuses as the one-time industry darling grapples with the crypto downturn. The Singapore-based outfit told employees this week that it is scrapping performance-based bonuses for 2022 due to slower business growth and market uncertainties, in an internal memo viewed by Bloomberg News. Since June, Amber has kicked off a series of cost-cutting measures including redundancies and wage reductions. Some of its management team have voluntarily agreed to give up all or ...

FTX Lesson No. 1: Don’t Fall Asleep in Accounting Class

14Dec

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Technology

FTX Lesson No. 1: Don’t Fall Asleep in Accounting Class

[ad_1] Sam Bankman-Fried is a reminder that under the heading, 'Boring But Important,' basic bookkeeping tops the list. Investigations are underway into the stunning collapse of FTX and its sister company, Alameda Research. FTX-related case studies will be taught in business schools for years to come. Out of the tangled mess, one lesson already has become clear: The lack of a serious accounting system or even basic internal controls contributed to the company's downfall. As professors of accounting, it's a continual challenge convincing students that our courses are important when they're tempted by sexier-sounding classes with titles that include words like “innovation,” “artificial intelligence” or “fintech.” “Introduction to Financial Accounting” doesn't pique the interest of th...

Binance, Tether to Solana, After FTX Fall, These Crypto Entities Are Grabbing the Spotlight

14Dec

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Technology

Binance, Tether to Solana, After FTX Fall, These Crypto Entities Are Grabbing the Spotlight

[ad_1] Sam Bankman-Fried’s arrest in the Bahamas pending a possible extradition to the US opens a fresh chapter in efforts to untangle whether his crypto empire was built using fraudulent methods. Sam Bankman-Fried's arrest in the Bahamas pending a possible extradition to the US opens a fresh chapter in efforts to untangle whether his crypto empire was built using fraudulent methods.Regardless of the outcome, the demise of his digital-asset exchange FTX continues to shake the wider crypto market's foundations. Skittish investors are pulling money out of rival exchanges, fearful of having their assets stuck should any of those venues collapse. At least one major crypto firm has filed for bankruptcy in the wake of FTX's unraveling, while two others were forced to suspend some withdrawal...

Cryptoverse: Jump or slump? $30k or $5k? Play the bitcoin roulette

13Dec

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Cryptoverse: Jump or slump? $30k or $5k? Play the bitcoin roulette

[ad_1] Plucky bitcoin's been holding steady since seeing off the chaos of the FTX collapse, gathering its strength to rally towards the dizzy heights of $30,000 in 2023. Plucky bitcoin's been holding steady since seeing off the chaos of the FTX collapse, gathering its strength to rally towards the dizzy heights of $30,000 in 2023. Battered bitcoin's been unresponsive since being clobbered by the FTX collapse, taking in a deep ragged breath before plunging towards the depths of $5,000. Place your bets, spin the wheel. The world's dominant cryptocurrency has certainly been uncharacteristically muted over the past two weeks, treading water between about $15,770 and $17,350 in the eerie wake of the FTX-induced market mini-crash in November. What happens next is anyone's guess. "T...

An Obscure Bank Found Its Key to Success. Then FTX Collapsed

10Dec

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Technology

An Obscure Bank Found Its Key to Success. Then FTX Collapsed

[ad_1] Over the course of a decade, the La Jolla, California-based company transformed itself from a bank catering to small businesses into a publicly traded firm. Silvergate Capital Corp. was dealing with the same problem many small US banks face: How do you differentiate yourself when larger competitors do everything you do, only better?The solution it found was to focus on a sector other banks didn't want to touch: cryptocurrency. Over the course of a decade, the La Jolla, California-based company transformed itself from a bank catering to small businesses into a publicly traded firm known for providing banking services to major crypto clients such as Coinbase Global Inc. and Gemini Trust Co. — as well as Sam Bankman-Fried's FTX and Alameda Research. The arrangement was going well,...

Mystery of Terra Collapse Deepens With Possible FTX Role Raised

9Dec

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Mystery of Terra Collapse Deepens With Possible FTX Role Raised

[ad_1] US prosecutors are said to be investigating Sam Bankman-Fried, the founder of collapsed crypto exchange FTX and its sister trading platform Alameda Research. The latest twist in the downfall of crypto maven Sam Bankman-Fried is prompting a reexamination of the implosion of the Terra algorithmic stablecoin ecosystem that wiped out around $40 billion in market value earlier this year.US prosecutors are said to be investigating Bankman-Fried, the founder of collapsed crypto exchange FTX and its sister trading platform Alameda Research, regarding his possible involvement in orchestrating the death spiral of TerraUSD (UST) and its affiliated token Luna, according to a report in the New York Times citing people with knowledge of the matter. Separately, Bloomberg News reported that FT...

A Hedge Fund Hit by FTX Collapse Defaults on $36 Million of Debt

6Dec

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Technology

A Hedge Fund Hit by FTX Collapse Defaults on $36 Million of Debt

[ad_1] Contagion from the collapse of crypto exchange FTX is spreading into the world of decentralized finance. Contagion from the collapse of crypto exchange FTX is spreading into the world of decentralized finance, as lending protocol Maple Finance severed ties with a hedge fund that defaulted on almost $36 million worth of crypto loans on its platform.Sydney-based Orthogonal Trading said in a tweet on Tuesday that it defaulted on a $10 million loan after being “severely impacted by the collapse of FTX and associated trading activities,” without giving further details. M11 Credit, which runs a lending pool on Maple, on Monday said Orthogonal Trading had informed it on Dec. 3 about its inability to repay. Orthogonal Trading had taken out $31 million of loans in the USDC stablecoin an...