Blockbytes Weekly - Week 9, 2024
Can you imagine taking trading tips from SBF in a Brooklyn jail cell? Sounds pretty interesting tbh
Bitcoin Is Hitting All-Time Highs Around the World
Despite not reaching its November 2021 all-time high in U.S. dollar terms (...yet), Bitcoin has set new records in local currencies across various global markets due to the strength of the U.S. dollar.
The U.S. dollar index (DXY) has increased by 10.7% since November 2021, affecting currencies worldwide and making bitcoin particularly attractive in markets such as China, Japan, the U.K., and India, along with developing countries like Argentina, Turkey, and Egypt.
The surge of the dollar is attributed to the robust growth of the U.S. economy compared to other major economies, although recent weak consumption and housing data in the U.S. suggest the future might be less predictable.
Japan has experienced a significant decline in the value of the yen, by 24%, making Bitcoin reach a record price in Japan before the recent surge in its price.
Aurelie Barthere, an analyst with Nansen, highlights a possible link between the U.S. dollar's value and cryptocurrency prices through the rates channel, suggesting a complex interplay between traditional and digital currencies.
Fantom Foundation Awarded Default Judgement Against Multichain
In July 2023, the Multichain bridge experienced a significant exploit, leading to the loss of over $210 million in assets across multiple chains, with losses in the Fantom ecosystem accounting for roughly a third of the total. After failed attempts to engage with Multichain Foundation’s former directors and key personnel, the Fantom Foundation initiated legal action against them, citing breach of contract and fraudulent misrepresentations. A notable development occurred on January 30, 2024, when Singapore’s High Court ruled in favor of Fantom, marking a successful default judgment that came into effect retroactively from November 30, 2023.
The complexity of the case was exacerbated by the lack of legals grounds for Fantom to recover funds on behalf of users, cross-jurisdictional legal challenges, and the opaque nature of police investigations.
Endeavors to tackle the issue included filing police reports in both Singapore and China, engaging legal counsel across multiple regions, partnering with blockchain intelligence firm TRM for forensic analysis, and initiating legal action in Singapore.
Following the court ruling, plans are underway to petition for the liquidation of the Multichain Foundation and appoint a liquidator to manage the recovery and distribution of assets.
While this legal victory marks a significant step forward, it begins a new phase in the ongoing efforts to manage the repercussions of the exploit, with the Fantom Foundation looking to leverage this win to assist all affected users in recovering their assets.
Bitcoin ETF mania is boosting BlackRock and Fidelity, which together have captured 79% of inflows into ‘Newborn Nine’
The surge in Bitcoin's price has significantly increased the flow of investments into spot Bitcoin ETFs, with BlackRock Inc.’s iShares Bitcoin Trust (IBIT) and Fidelity Investments’ Wise Origin Bitcoin Fund (FBTC) attracting the majority of these inflows.
Representing 79% of total inflows into the "Newborn Nine," a collection of the latest exchange-traded funds investing directly in Bitcoin, these funds have outshone their competitors.
In response, other funds have reduced their fees in efforts to compete, with Valkyrie Investments and Franklin Templeton offering significantly lower fees.
Amidst the competition, Grayscale Investment maintains a higher fee for its Bitcoin trust, even as it faces over $8 billion in outflows, suggesting a strategic play for long-term positioning in the market.
BlackRock appears to be gaining a dominant position in the sector, highlighted by a record single-day inflow of $612 million into its IBIT fund, showcasing the firm's strong distribution network and commitment to providing access to Bitcoin investments.
Nigerian Government Fines Binance $10B for ‘Illegal Transactions’
The Nigerian Government has imposed a substantial $10 billion fine on the cryptocurrency exchange Binance, citing profits from "illegal transactions" as the reason behind this decision, according to Bayo Onanuga, an advisor to President Bola Tinubu.
The fine was publicized after Nigerian officials arrested Binance executives, highlighting a crackdown on unregistered exchanges avoiding tax obligations.
Binance is under scrutiny for utilizing an exchange rate deemed "illegal" by Nigeria, with the Central Bank of Nigeria (CBN) being the only authorized entity to set the country's exchange rates. This situation allegedly exacerbates Nigeria's economic dilemmas, especially during a period of considerable volatility for the Nigerian Naira.
This series of events underscores Nigeria's increasing regulatory actions targeting the cryptocurrency sector, amidst concerns over the impact of such transactions on the country's economic stability.
Before announcing the fine, Bayo Onanuga had been vocal about the need for Binance to be accountable for its perceived negative influence on Nigeria's economy, particularly during a time when the nation is striving to stabilize its financial status.
Trading Platform Robinhood, Layer-2 Arbitrum Team Up To Offer Swaps To Users
Robinhood, the widely recognized trading platform, has made headlines at ETHDenver by unveiling a new feature for its Robinhood Wallet users, enabling them to access swaps on Arbitrum, a layer-2 blockchain built on top of Ethereum.
Robinhood announced the integration of Arbitrum swaps into its Robinhood Wallet at ETHDenver, aiming to simplify access to decentralized finance (DeFi) for its users.
Following the announcement, Arbitrum's native token, ARB, experienced an 11% increase in value, highlighting the market's positive reaction to the collaboration.
The partnership focuses on enhancing Web3 accessibility by offering low-cost in-app swaps and cross-chain transactions, addressing the complexity typically associated with layer-2 solutions.
Arbitrum is distinguished in the DeFi sector for its high Total Value Locked (TVL) of approximately $3.2 billion at time of writing, leading among Ethereum's layer-2 solutions.
Tether’s USDT stablecoin hits historic $100B market cap
Tether's USDT stablecoin has reached a milestone market capitalization of $100 billion, marking a significant achievement in the crypto industry and strengthening its position as the largest stablecoin by market cap.
This growth represents a 9% increase year-to-date, distancing it further from its closest competitor, USD Coin (USDC), which also saw growth but remains over $71 billion behind.
The company behind Tether has managed to record a substantial quarterly profit of $2.85 billion in Q4 of 2023, with significant holdings in U.S. Treasury Bills and Bitcoin.
Concerns have been raised about the quality of assets backing USDT, prompting Tether to work towards reducing its exposure to higher-risk assets and pledging to eliminate loans from its reserves by the end of 2024.
Tether aims to maintain trust and confidence among its users by ensuring full backing of each USDT token with its reserves and emphasizing its collaboration with law enforcement agencies to address concerns over illegitimate uses.
FTX founder SBF asks for a 6.5-year sentence, tells prison guards to invest in Solana
The legal team of Sam “SBF” Bankman-Fried, the former CEO of FTX, has requested a notably lenient sentence of 5.25 to 6.5 years in prison for their client. This plea comes after SBF was convicted of various fraud and money launderin
SBF's legal defense described the recommended 100-year sentence as excessively harsh for a first-time offender, highlighting his potential for rehabilitation and the absence of direct financial harm to victims, asserting that all parties affected by the FTX collapse are expected to be fully reimbursed.
The defense submission also emphasized the support from friends and family for a more lenient sentencing approach, suggesting SBF's positive personal attributes and the unjust nature of the suggested long-term incarceration.
SBF has been detained at the Metropolitan Detention Center in Brooklyn since the summer of 2023, where he has become known for trading prison commodities and offering financial advice to fellow inmates and guards, maintaining his connection to the crypto world through a proposition involving Solana’s SOL cryptocurrency.
The fall of FTX, previously a crypto exchange giant valued at $32 billion, and SBF's subsequent legal troubles have brought to light the volatile nature of the cryptocurrency industry and the intricate legal and economic issues surrounding its regulation and oversight.