In a special edition of CoinMarketRecap, Connor Sephton and Molly Jane Zuckerman dive into the crisis that has engulfed FTX. We find out what led to the exchange filing for bankruptcy, the bombshell allegations against Sam Bankman-Fried and other executives, and what all of this means for the thousands of people who had funds locked up in the platform. Plus — we take a look at what will happen next as bankruptcy proceedings wind their way through the courts, and how this will affect the wider crypto sector. You can find us on Apple Podcasts, Spotify and Google Podcasts.
The Justice Department is being urged to investigate FTX’s collapse — and bring prosecutions if necessary. Two U.S. senators are calling for the “flesh and blood” victims of the exchange’s demise to be remembered. Elizabeth Warren and Sheldon Whitehouse went on to allege that Sam Bankman-Fried deployed “intentional and fraudulent tactics” during his time as CEO. Galaxy Digital’s Mike Novogratz told CNBC that SBF “certainly did things with our coins that were illegal” — and slammed the 30-year-old for “running around The Bahamas giving press conferences.” And expressing confidence that the embattled entrepreneur will face consequences, he added: “I think that his day will come.”
Sam Bankman-Fried isn’t the only one being blamed for what happened at FTX. One crypto-friendly politician, Tom Emmer, has argued that SEC chairman Gary Gensler is almost as much to blame. He’s accused the regulator of giving SBF and his business “special treatment” — telling Fox News that the SEC has been ineffective: “Where was [Gensler] on Celsius? Where was he on Voyager? Where was he on Terra/LUNA? And now where was Gary Gensler on FTX?” Not all of his colleagues were as tough on Gensler. Senator Cynthia Lummis pointed out that it can take years to develop enforcement action against complicated firms. Her Republican colleague Pat Toomey also pointed out that much of FTX was based in The Bahamas.
With the World Cup now underway, there’s a lot of buzz surrounding football (or soccer if you’re reading us in the U.S.) Cristiano Ronaldo has just launched an NFT collection in partnership with Binance — coming in the same week as his sudden departure from Manchester United. Meanwhile, it seems fan tokens are being used to vent anger at the performance of some national teams. The Argentine Football Association’s ARG fan token plummeted about one-third during its shocking upset by Saudi Arabia, falling from $7.26 to $4.90. On the other hand, the “floor price” of “The Saudis” NFT collection jumped 50% during the game, with sales volume up almost 1,000%, top NFT site OpenSea reported.
The metaverse, NFTs and Web3 will become a bigger and bigger playground for cyberthieves, phishers and scammers, cybersecurity firm Kaspersky said. The Russian firm’s Crimeware and Financial Cyberthreats in 2023 report has warned these attacks will be most prevalent in the entertainment and gaming sectors. That said, Kaspersky also believes that people are getting wise to the simpler scams like givebacks, in which someone — often posing as a celebrity — offers to send anyone double the BTC (or some such) they send in as a way of “giving back to the community.” Another prediction is that ransomware blackmailers will turn away from increasingly traceable Bitcoin in favor of privacy coins like Monero and Zcash.
Thanks for reading! Have a great day — more news tomorrow!
