FTX goes up in flames and impacts the broader crypto industry, causing regulators to respond: Hodler’s Digest, Nov. 6-12


coming every saturday Hodler’s Digest It will help you keep track of all the important news that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions, and much more – a week at Cointelegraph in one link.

Top news this week

The ongoing FTX and Binance saga: everything that has happened so far

An earthquake rocked the crypto space this week, its impact felt across numerous stories involving FTX, Alameda Research, and Binance. Although the bad news came this week, the suspicions related to the state of FTX appear to have started on November 2. The concerns had to do with a large number of FTX tokens (FTT) in the hands of Alameda (Sam Bankman-Fried, aka SBF, founded Alameda and co-founded FTX). By November 6, Binance had decided that it would sell its important position in FTT. FTX’s withdrawal problems arose on November 7, symptomatic of a bank run. Binance expressed interest in buying FTX but rejected the purchaseciting concerns on November 9.

Other developments throughout the week included SBF reportedly requests $8 billion to cover trade withdrawals and news of the situation affecting other big players as Sequoia Capitalas much as related regulatory headlines.

November 11th saw the resignation of SBF as well as FTX, Alameda and FTX US filing for Chapter 11 bankruptcy in the United States. About 130 entities under FTX Group are filing for bankruptcy.

Breaking: Bahamas Securities Regulator Freezes FTX Assets

On November 10, FTX saw its assets frozen and its registration suspended by the Bahamas Securities and Exchange Commission, based on suspicions of mishandling client funds. The Supreme Court of the Bahamas chose a provisional liquidator, which means that FTX must now get permission to touch any of its assets. FTX is primarily based in the Bahamas, under its jurisdiction. The situation regarding FTX User Withdrawals It has been touch and go, with some withdrawals apparently being approved and funds coming out of the exchange. Additionally, FTX negotiated an agreement with Tron to allow TRX, BTT, JST, SUN, and HT holders to exchange FTX assets to external wallets without penalty.

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Chainlink Labs Offers Proof-of-Reserve Service for Conflicting Exchanges

Given the situation with FTX, there has been talk of requiring crypto exchanges to submit proof of reserve, which would essentially ensure that exchanges hold enough assets to cover their liabilities. Chainlink Labs has developed a product that aims to make that process easier for exchanges. Multiple crypto exchanges have been put forward with the intention of providing some sort of proof of reserve system (not necessarily Chainlink’s product, but some sort of system in general), including Binance, which has already advanced in a proof of reserve system.

White House says ‘prudent regulation of cryptocurrency’ is needed, hinting at situation with FTX

The turmoil this week has prompted the administration of US President Joe Biden to police the crypto space, with the help of US regulatory bodies for enforcement. “The administration […] has consistently argued that without proper oversight, cryptocurrencies risk harming ordinary Americans,” White House press secretary Karine Jean-Pierre said during a Nov. 10 press conference. really necessary.”

Post-Election Roundup: Who Were the Winners and Losers for and Against Crypto in the US Midterm Elections?

The US midterm elections occurred on November 8. The crypto space had a presence in the elections, encompassing a wide number of stances and positions on industry regulation held by the politicians involved. Among the mix, JD Vance, a well-known Bitcoin owner, won a seat in the Ohio Senate. Tom Emmer and Patrick McHenry, two pro-crypto figures, also held their positions in Minnesota and North Carolina, respectively. However, Brad Sherman, who is less crypto-friendly, won re-election in California.

Winners and losers

WL NOV 12 01

At the end of the week, Bitcoin (BTC) I sat down $16,932, Ether (ETH) a $1,274 Y XRP a $0.37. Total market capitalization is $859.61 billion, according to to CoinMarketCap.

Among the largest 100 cryptocurrencies, the top three altcoin gainers of the week are PAX Gold (PAXG) at 5.69%, Gemini dollar (GUSD) at 0.71% and Dai (DAY) at 0.14%.

The top three altcoin losers of the week are FTX Token (FTT) at -89.18%, Solana (SUN) to -50.30% and Loopring (LRC) at -38.47%.

For more information on cryptocurrency prices, be sure to read Cointelegraph Market Analysis.

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most memorable quotes

“If the world economy is a circulatory system, it is stagnant. The pieces are dying.”

michel jazzakacryptographer and founder of Valuechain

“If you look closely, fractional NFTs represent the very essence of the Web3 concept.”

Alexei KulevetsWalken Co-Founder and CEO

“I think what people often misunderstand is that Web3 is not a new exclusive Internet. Within Web3 we also find Web2, in the same way that we found the old World Wide Web within Web2.

max kordeklist president

“With a global MICA [Markets in Crypto-Assets regulatory framework]the FTX accident would not have happened.”

Stefan Bergermember of the Committee on Economic and Monetary Affairs of the European Parliament

“All crypto exchanges should test merkle-tree reserves.”

Chang Peng “CZ” ZhaoBinance CEO

“FTX.com was an offshore exchange not regulated by the SEC. The problem is that the SEC failed to create regulatory clarity here in the US, so many US investors (and 95% of business) went abroad. Punishing corporate America for this is pointless.”

brayan armstrongCoinbase CEO

prediction of the week

Bitcoin Price Bottom Takes Shape as ‘Old Coins’ Hit Record 78% of Supply

Bitcoin started the week above $21,000, though the asset fell sharply after the FTX news broke, dipping below $16,000 on Nov. 9, according to Cointelegraph’s BTC Price Index. Subsequently, BTC rallied as high as $18,000, but then declined once more.

Decentrader’s pseudonymous co-founder Filbfilb explained why the FTX situation is such an important event in the industry. His explanation essentially said that all was well during the crypto industry’s most recent bull market, but the players were overextended. Then came the bear market, and falling prices created holes in corporate balance sheets. He explained that a healthy recovery could be a multi-year effort.

FUD of the week

Digest 12 11 02

Report: Tether Freezes $46 Million USDT From FTX, Setting New Precedent

Stablecoin issuer Tether Limited apparently froze around $46 million worth of USDT held on FTX’s Tron blockchain wallet, according to Whale Alert blockchain observations Nov. 10. Tether has not previously frozen a company or exchange wallet, only privately owned wallets in tandem with regulatory investigations. In comments to Cointelegraph, a Tether spokesperson did not confirm the alleged freeze, but noted the company’s regular communication with law enforcement.

Bitcoin miner Iris Energy faces $103 million default claim from creditors

The bear market lows continued this week, as news surfaced about financial difficulties at renewable energy Iris Energy’s Bitcoin mining operation. According to a notice of default issued by mining rig maker Bitmain Technologies, the company allegedly owes $103 million in total. Multiple factors have apparently contributed to Iris Energy’s declining financial position, such as the depressed price of Bitcoin and increases in electricity costs.

BlockFi limits platform activity, including suspending customer withdrawals

Withdrawals and other features have come to a halt on BlockFi, and the digital asset lending platform explains that it is waiting for clarity on FTX’s ordeal. Furthermore, BlockFi noted that clients should refrain from depositing to BlockFi wallets or their platform of interest. BlockFi and FTX US previously reached an agreement involving a $400 million line of credit extended to BlockFi.

Best Cointelegraph Features

Digest 12 11 03

How to prevent your crypto community from imploding

“There were a lot of cypherpunks at those early Bitcoin meetups I attended.”

Some central banks have withdrawn from the digital currency race

There are at least four countries that have scrapped or halted CBDC plans so far, and each central bank has its own reasons for not launching one.

Could Bitcoin have launched in the 1990s, or was it waiting for Satoshi?

With the Internet, elliptic curve cryptography, even Merkle trees and PoW protocols all present, Bitcoin was “technically possible” in 1994.

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editorial staff

Writers and reporters at Cointelegraph Magazine contributed to this article.