SBF Misbehaved & Now He’s Grounded 😅

In today's edition: 💸 5 bullish on-chain signs, 🙅‍♂️ Tether denies a loan to Celsius, 🥷 a new DeFi exploit, and more!

February 02, 2023

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On the Pod…

And … a New Video on Regulation Post-FTX! 💯

We're trying something new — short videos about hot topics in crypto. Watch it here & let us know what you think of what Gary Gensler called crypto exchanges 👀

What’s Poppin’?

5 Positive On-Chain Signals in a Bear Market

Is the worst over for crypto? These five pieces of on-chain data could give market participants a reason to be optimistic.

SBF Restricted From Contacting FTX Employees

Former FTX CEO Sam Bankman-Fried has been barred from contacting FTX and Alameda employees. A ruling issued by U.S. District Judge Lewis Kaplan on Wednesday modified Bankman-Fried’s bail conditions to include this restriction after prosecutors accused him of witness tampering earlier this week.

Bankman-Fried had contacted Ryne Miller, the General Counsel at FTX, through email and encrypted messaging app Signal, suggesting the two “vet things with each other.” He also emailed current FTX CEO John Ray III, requesting an in-person meeting.

Tether Denies Borrowing $2B From Celsius

Stablecoin issuer Tether has denied a claim from Celsius’s bankruptcy examiner that it borrowed $2 billion from the bankrupt crypto lender. The 476-page examiner’s report published on Tuesday detailed how Celsius overleveraged itself to Tether with loans that were “twice its credit limit,” citing a document from 2021.

Tether CTO Paolo Ardoino claimed in a tweet that the firm had never borrowed from Celsius. He called the report a “mischaracterization,” pointing to a possible typo in the filing.

BonqDAO Loses $88M in Exploit

Decentralized borrowing protocol BonqDAO was exploited for $88 million in tokens, as per a report from The Block. The hacker removed 114 million of AllianceBlock’s wrapped token “wallbt” and 98 million of Bonq’s collateralized Euro-pegged stablecoin. AllianceBlock is a protocol that provides a bridge between traditional finance and DeFi.

So far, the hacker has sold around $1.2 million worth of tokens but is struggling to convert the rest of the stolen funds due to a lack of liquidity – which is the goal of both AllianceBlock and BonqDAO.

AllianceBlock said that the incident was isolated to ALBT troves on Bonq, and that no other smart contracts were breached or compromised.

Voyager Digital Denies Alameda's $446M Clawback Attempt

Alameda Research’s plans to reclaim $446 million worth of loan repayments from Voyager Digital have fallen through. A court filing on Wednesday shows that Alameda’s motion has been denied by Voyager and its creditor committee. Voyager expects that Alameda’s claims will be reclassified as equity, or placed as a secondary claim to all other creditor claims.

Alameda’s alleged false statements regarding its financial strength were the main reason that Voyager purchased the loans on its insolvent balance sheet.

“Had the committee known the truth, it would never have approved the AlamedaFTX transaction,” said the Voyager creditors.

Celsius Allows 94% Withdrawal for Certain Customers

Bankrupt crypto lender Celsius will let select customers withdraw their assets from the platform. 

In an update to its withdrawal process posted to Twitter on Wednesday, Celsius said that customers who qualify for the service will be allowed to withdraw 94% of their balances from custody accounts. The firm has published the names of users who are allowed to withdraw their assets from the platform.

Celsius said it will send a detailed email around Feb. 15 informing users of their eligibility to withdraw crypto locked on the platform.

Users who request a withdrawal will also be charged withdrawal fees of $2.25 for BTC, $2.40 for ETH, $5.20 for ERC-20 tokens and $1.20 for other altcoins. Those that do not have sufficient asset balances to satisfy the fee requirements will not be permitted to withdraw their assets.

Stargate to Reissue Tokens After Alameda Wallet Hack Fears

DeFi bridge protocol Stargate plans to reissue all of its native STG tokens and airdrop them to existing holders. The token reissue was announced in a blog post on Wednesday, with the protocol citing a “significant threat” to its protocol owned liquidity (POL). The concern stems from recent on-chain transfers that suggest a hacker was controlling Alameda’s wallets.

Alameda purchased around 10% of STG’s total supply in a community sale conducted in March 2022.

“Without a token re-issuance a malicious actor with access to Alameda’s private keys could claim the Stargate tokens from the contract as they vest and misappropriate them as they seem to have with other funds,” said Stargate.

On Unchained Premium…

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In Other News…✍️✍️✍️

  • Officials from multiple states requested a federal bankruptcy judge to appoint an independent examiner to assess FTX's financial situation due to concerns about the transparency of the fallen crypto exchange's assets. 

  • Paul Engelmayer, a U.S. District Court Judge, dismissed the allegations made in a class-action lawsuit filed by customers who accused Coinbase of selling unregistered securities and not registering as a broker-dealer.

  • The U.S. Treasury's Office of Foreign Assets Control (OFAC) imposed sanctions on two cryptocurrency addresses associated with a Russian arms dealer.

  • Coinbase NFT recently announced a temporary halt on new NFT releases following an artist's announcement on Twitter that their upcoming NFT drop would not be launching on the marketplace.

  • The Federal Reserve raised interest rates by 25 basis points, which was what the market expected, and crypto assets remained flat. 

  • Core Scientific, a bankrupt Bitcoin miner, was granted approval by a judge to refinance its debt.

Today in Crypto Adoption...

  • Luxor Technologies, a company providing Bitcoin mining services, initiated the industry's first consolidated marketplace for new mining machines. 

The $$$ Corner…

  • Lending and borrowing marketplace Archimedes raised $4.9 million in a seed funding round.

What Do You Meme

📈 Your Market Update 📉

  • BTC is up 3.62%, trading at $23,849

  • ETH is up 6.3%, trading at $1,674

  • BTC dominance: 40.91%

  • Crypto market cap: $1.12 trillion

*All data as of today, 5 am ET

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