The crypto spot market has delivered returns to traders who took advantage of a bright start to the week. This pushed prices into uncharted territory across the board for over a month. The recent price surge has pushed Bitcoin above $18,230 and the BTC/USD pair has closed its fifth consecutive day of positive trading. These string of gains are part of a streak of green candles that have been slightly hurt since the beginning of the year, only tainted by losses recorded over the weekend. Beyond market movements, the broader industry remains in a difficult position to navigate the headwinds that are afflicting traders at the same time.
In the latest development, FTX Exchange has lost naming rights to the 21,000-capacity home arena of NBA team Miami Heat due to a federal court ruling. A deal agreed in March 2021, at the request of FTX executive deputies and Miami-Dade County, will close with a ruling Wednesday set for Dec. 31, allowing it to seek a new sponsor. . Here are other headlines about the problematic exchange, the progress of the lawsuit, and other relevant agency updates this week.
Binance.US Seals Acquisition of Lender Voyager Digital
Closed cryptocurrency lender Voyager Digital received initial approval Tuesday from the Southern District of New York to proceed with the $1 billion sale of customer accounts and other assets to the U.S. subsidiary of the world’s largest cryptocurrency exchange, Binance. Got. News of the acquisition Binance.US launched last month has, at least in part, brought Voyager’s plans to settle creditors closer to reality. New York Bankruptcy Court Judge Michael Wiles has authorized the release of a statement outlining details of Voyager’s planned asset sale.
The court further scheduled a confirmation hearing for March 14, noting that the plan must be approved by the required number of disabled creditor classes for it to become law. The bankrupt lender originally reached an agreement with FTX to sell him for $1.4 billion, but the deal fell through as concerns about FTX’s liquidity surfaced. Binance.US wasted no time and won the race once bidding resumed. Voyager’s lawyer Joshua Sussborg, who attended the hearing, told the court that the acquisition by Binance.US would be the best outcome for Voyager’s creditors. He argued that a self-liquidation scenario would not result in much asset recovery for affected customers.
Regulators that determine the outcome of transactions
Voyager Digital has nearly won expedited review of the agreement by the US National Security Agency, but the regulator itself could prove to be a hurdle. The Commission on Foreign Investment in the United States (CFIUS) has previously claimed that Voyager intends to review past deals. The interagency panel, whose oversight includes foreign investment, suggested that the outcome could affect the parties’ ability to enter into a transaction, the timing of closing, or the material terms of the transaction. Additionally, the Securities and Exchange Commission (SEC) filed a limited objection last Wednesday, questioning Binance.US’ financial ability to effect the trade, and is following it closely.
U.S. market regulators have highlighted flaws in the details provided by exchanges regarding the steps they take to protect client assets. We also presented the issues raised regarding the intended methodology of crypto portfolio rebalancing. If the deal goes through, Voyager estimates that the customer will recover approximately 51% of the value of the assets held by the lender at the time of bankruptcy. The deal is a combination of a $20 million cash payment and an agreement to move Voyager customers to the exchange. They have been able to withdraw funds and have been inactive since July last year.
Coinbase Closes Shops in Japan Amid Massive Layoffs
In an interview with BNN Bloomberg on Wednesday, Coinbase’s vice president of business development, Nana Murugesan, revealed that the exchange would be putting an end to exploits in Japan. Business executives said the company’s decision to close most of its operations in the Asian country effectively cut employee positions. Murugesan said only a small number of staff would remain in the role to protect client assets, although he did not disclose specific numbers.
He also declined to give details of a potential sale or possible merger of the Japanese division, revealing that the company is currently navigating a transition period. It will only come after the conclusion of ongoing discussions between Mr. Nao Kitazawa and the regulator, Japan’s Financial Services Agency (JFSA). Murugesan speculated that the exchange is “right-sizing” its business to match available opportunities, adding comments similar to those of the CEO regarding its dedication to global expansion.
NYSDF Orders Coinbase To Pay Fines For Substandard KYC Checks
Notably, the exchange recently fined $50 million for failing to fully comply with Know-You-Customer (KYC) requirements. He also agreed to invest an additional $50 million into the company’s compliance program over the next two years. The arrangement came after regulators discovered that Coinbase allowed customers to create accounts without fully verifying their identities. The exchange also overlooked other due diligence requirements regarding anti-money laundering.
Deficiencies in compliance controls encouraged “suspicious or illegal activity” on the platform in accordance with consent orders issued by authorities. One of the specific cases cited by the regulator was a customer charged with “crimes related to child sexual abuse,” identified through Coinbase’s customer due diligence process when opening an account on the exchange. It was not. The user is reported to have engaged in “suspicious transactions that may be related to illegal activities without detection by Coinbase” for over two years. Eventually her Coinbase detected the user, closed the account, and reported the activity to law enforcement. Since then, the exchange has committed to addressing the issue and enforcing clearer and more comprehensive regulation in the crypto industry.
Zipmex exchange under investigation in Thailand
The trend of troubled exchanges is emerging in Asia as well, with cryptocurrency exchange Zipmex being investigated by Thailand’s Securities and Exchange Commission (SEC) for alleged illegal manipulation as a fund manager. It is reported. Bloomberg’s report on Wednesday included a letter from the domestic market regulator, the exchange. Zipmex, already in financial straits, made the decision to stop withdrawals last year and was reported to law enforcement officials in September for failing to submit its records to the commission. Exchanges must respond by Thursday, January 12th.
Accumulating DCG anguish on all fronts
In another development on Tuesday, the co-founder and president of cryptocurrency exchange Gemini Cameron Winklevoss said in an open letter sent to the conglomerate’s board of directors that CEO of Digital Currency Group (DCG) Barry Silver. demanded that Toh be dismissed. Winklevoss said the expulsion had to take place before any solution could be found regarding the settlement of the creditors.Further explanation by Winklevoss was how Genesis had a contagion effect from the downfall of defunct hedge fund Three Arrows Capital. was covered. The bankruptcy of his 3AC, which loaned about $2.36 billion to the fund, meant that the lending business had to absorb his $1.2 billion loss.
of response In response to its accusations, the DCG said that all Winklevoss diverts personal responsibility and the exchange’s vision for the Earn program. Gemini announced this week that it is scrapping the latter’s flagship plans. The escalating turmoil has drawn the attention of US prosecutors and domestic market regulators who are reportedly investigating the matter. Nonetheless, VC firms have shown a willingness to continue discussions to finally reach a working solution amid increasing setbacks.
DCG’s creditor, cryptocurrency trading platform Bitvavo, has declined DCG’s offer to pay off 70% of its outstanding debt, notifying it wants a full settlement, in an update on Jan. 11. The Netherlands-based exchange has rejected a partial repayment plan representing a counteroffer from a troubled firm, citing that the debtor has “sufficient resources” to pay the full amount. The blog was published shortly after the exchange decided to pre-fund approximately $297 million in assets that were offered to the venture to avoid getting stuck in a sticky situation. Bitvavo assured that it had sufficient funds to continue operations, but insisted on repayment, which it decided to secure.
“Like Gemini, we share confidence that we can find a solution that satisfies all parties involved.”
Regarding the issues affecting DCG, Galaxy Digital chief Mike Novogratz said in an interview on CNBC’s Squawk Box on Tuesday that digital asset investment firms wouldn’t necessarily need to sell assets to stay safe. DCG last week announced the closure of HQ, its wealth management arm.Reported by information estimates that HQ had about $3.5 billion in assets under management when it closed last week. Last November, the asset manager told shareholders it owed $575 million in loans and $1.1 billion in promissory notes to Genesis Global Capital, the lending arm of Genesis Global Trading.lender pause “Initiation and redemption of new loans in the same month due to”extreme market turmoil“
Binance Wins While Other Exchanges Shrink
Binance was the clear winner among centralized trading platforms in terms of performance and overall expansion in 2022. The exchange started the year with the same purpose in mind, CEO Changpeng Zhao confirmed at the Crypto Finance Conference on Wednesday. It reiterated that it would increase headcount from 15% to 30%.
The exchange’s employee list has more than doubled from last year’s 3,000 to eventually reach nearly 8,000. John Woods of the Algorand Foundation provided insight into the future of cryptocurrencies in an interview on Jan. 8, citing recent concerns headlines about exchanges have tarnished the sector’s image and undermined user confidence. However, we observed that the most important fundamentals were unaffected.