First Mover Asia: Bitcoin Drifts Lower as Crypto Winter Continues
7 min read
Good morning. Right here’s what’s taking place:
Costs: Bitcoin drifted decrease in Tuesday buying and selling, albeit not by a lot as crypto costs remained largely frozen close to ranges they’ve held for every week.
Insights: On this final week of 2022, First Mover Asia is revisiting a couple of of CoinDesk’s (CD) finest, most impactful tales from the previous yr. Lower than a month after a CD story led to the implosion of crypto change large FTX in November, Chief Insights Columnist David Z. Morris zeroed in on the seriousness of CEO Sam Bankman-Fried’s offenses. The U.S. Division of Justice subsequently charged Bankman-Fried with wire fraud and different alleged crimes. After posting bail, he’s confined to his mother and father California dwelling besides to train, and should put on a monitoring machine.
Catch the newest episodes of CoinDesk TV for insightful interviews with crypto trade leaders and evaluation. And sign up for First Mover, our day by day publication placing the newest strikes in crypto markets in context.
Costs
792.84
−7.9 ▼ 1.0%
$16,700
−217.1 ▼ 1.3%
$1,211
−16.3 ▼ 1.3%
S&P 500 day by day shut
3,829.25
−15.6 ▼ 0.4%
Gold
$1,821
+25.2 ▲ 1.4%
Treasury Yield 10 Years
3.86%
▲ 0.1
BTC/ETH costs per CoinDesk Indices; gold is COMEX spot value. Costs as of about 4 p.m. ET
Frozen Markets, a Bitcoin Drift
By James Rubin
Bitcoin drifted decrease in Tuesday buying and selling, albeit not by a lot as traders continued their historic, year-end hibernation. Crypto costs stay frozen close to the degrees they’ve held for a lot of the previous two weeks.
The most important cryptocurrency by market capitalization was lately altering arms at $16,700, off 1.3% over the previous 24 hours however close to its most up-to-date assist just below $17,000. BTC’s value has remained resilient over the previous two months, regardless of the widening fallout from the implosion of crypto change FTX.
In a CoinDesk TV First Mover interview, Martin Leinweber, digital asset product strategist at Market Vector Indexes, famous bitcoin’s energy relative to different cryptos. “If you look at the coins that demonstrate relative strength, which means coins that fell the least amount from the all-time high, you will notice names that nearly no one would have imagined, especially when you consider the ranking,” Leinweber mentioned. “So bitcoin was not the most defensive coin, one might expect from a store of value.”
Story continues
Ether was lately buying and selling simply over $1,200, additionally down 1.3% from Monday, identical time. Most different main cryptos had been barely within the pink with LINK, the token of software program platform Chainlink, and CRO, the native cryptocurrency of change Crypto.com, every sinking greater than 2%. The CoinDesk Market Index (CDI), an index measuring cryptos’ efficiency, fell 1.15%.
Main fairness indexes closed combined after a excellent news, unhealthy information day during which China introduced it will enable worldwide vacationers to enter the nation once more however Russia mentioned it will ban oil gross sales to international locations that had positioned a $60 per barrel value cap on it – the newest fallout from Russia’s unprovoked invasion of Ukraine. How the strikes will have an effect on costs worldwide is unsure. Brent crude oil, a broadly watched measure of worldwide power markets, was lately promoting at $85 per barrel, an 11% acquire over the previous three weeks. The tech-heavy Nasdaq slipped 1.4%, however the Dow Jones Industrial Common ticked up barely.
In the meantime, FTX’s unhappy, unsavory saga continued with documents filed in Caribbean court displaying that former CEO Sam Bankman-Fried borrowed a whole bunch of thousands and thousands of {dollars} from Alameda Analysis to buy his stake in buying and selling app Robinhood Markets (HOOD).
In an affidavit earlier than his arrest, Bankman-Fried mentioned he and FTX co-founder Gary Wang collectively borrowed over $546 million from Alameda by way of promissory notes in April and Might. They used that cash to capitalize Emergent Constancy Applied sciences Ltd., the shell company that in Might purchased a 7.6% stake of Robinhood.
The FTX disaster has renewed requires stronger regulation some seven months after the TerraUSD (UST) stablecoin misplaced its greenback peg. The ensuing collapse of the Terra ecosystem through the spring jolted lawmakers who had been hesitating to create stricter pointers focusing on digital property to ratchet up their efforts. As but, little concrete has resulted, though many crypto insiders anticipate modifications within the yr forward and past to guard traders.
Market Vector Indexes’ Leinweber mentioned he would embrace stablecoin regulation. “I welcome those regulations,” he mentioned. “It will lead to more dollars in that space. There are some unregulated, poorer constructed ones. But they’re also good stablecoins.”
Largest Gainers
Largest Losers
Insights
FTX’s Collapse Was a Crime, Not an Accident
By David Z. Morris, CoinDesk Chief Insights Columnist
Within the weeks since Sam Bankman-Fried’s cryptocurrency empire was revealed to be a home of lies, mainstream information organizations and commentators have typically failed to offer their readers a simple evaluation of precisely what occurred. August establishments together with the New York Occasions and Wall Road Journal have uncovered many key info in regards to the scandal, however they’ve additionally repeatedly appeared to downplay the info in ways in which soft-pedaled Bankman-Fried’s intent and culpability.
It’s now clear that what occurred on the FTX crypto change and the hedge fund Alameda Analysis concerned a wide range of aware and intentional fraud supposed to steal cash from each customers and traders. That’s why a latest New York Occasions interview was widely derided for seeming to border FTX’s collapse as the results of mismanagement rather than malfeasance. A Wall Road Journal article bemoaned the loss of charitable donations from FTX, arguably propping up Bankman-Fried’s strategic philanthropic pose. Vox co-founder Matthew Yglesias, courtroom chronicler of the neoliberal established order, appeared to whitewash his personal entanglements by crediting Bankman-Fried’s cash with helping Democrats within the 2020 elections – sidestepping the probability that the cash was successfully embezzled.
Maybe most perniciously, many shops have described what occurred to FTX as a “bank run” or a “run on deposits,” whereas Bankman-Fried has repeatedly insisted the corporate was merely overleveraged and disorganized. Each of those makes an attempt to border the fallout obfuscate the core subject: the misuse of customer funds.
Banks could be hit by “bank runs” as a result of they’re explicitly within the enterprise of lending buyer funds out to generate returns. They’ll expertise a short-term money crunch if everybody withdraws on the identical time, with out there being any long-term downside.
However FTX and different crypto exchanges should not banks. They don’t (or mustn’t) do bank-style lending, so even a really acute surge of withdrawals mustn’t create a liquidity pressure. FTX had particularly promised customers it will by no means lend out or in any other case use the crypto they entrusted to the change.
CoinDesk’s Chief Insights Columnist David Z. Morris unpacks his newest opinion piece that argues Sam Bankman-Fried, former CEO of troubled crypto change FTX, is a fraud.
See additionally: Divisions in Sam Bankman-Fried’s Crypto Empire Blur on Alameda’s Balance Sheet
In actuality, the funds had been despatched to the intimately linked buying and selling agency Alameda Analysis, the place they had been, it appears, merely gambled away. That is, within the easiest phrases, theft at an almost unprecedented scale. Whereas the overall losses have but to be quantified, as much as one million customers might be impacted, in response to a chapter doc.
Necessary occasions.
11 p.m. HKT/SGT(3 p.m. UTC): U.S. Pending Home Sales (Nov. MoM/YoY)
8 p.m. HKT/SGT(12 p.m. UTC): U.S. Mortgage Bankers Association mortgage applications (Dec. 23)
CoinDesk TV
In case you missed it, right here is the latest episode of “First Mover” on CoinDesk TV:
Bitcoin Miners Powered Off as Winter Storm Battered North America; Bitcoin Holds Near $17K
Miners throughout the U.S. powered down over the weekend as a robust storm swept throughout North America. MarketVector Indexes Digital Asset Product Strategist Martin Leinweber shared his crypto markets evaluation. Additionally, Akin Gump Associate Ian McGinley shared his ideas on the newest authorized developments for former FTX CEO Sam Bankman-Fried.
Headlines
Crypto Investment Firm Midas Shutting Down Platform Following Losses: The collapse of Celsius and FTX led to greater than 60% of Midas’ property underneath administration being withdrawn.
Mango Markets Exploiter Eisenberg Arrested in Puerto Rico: Federal brokers weren’t a fan of Avraham Eisenberg’s “highly profitable trading strategy.”
Pudgy Penguins NFTs Break All-Time Highs With Holiday Rally: A quick-rising flooring value caps the as soon as written-off assortment’s banner yr.
Ellison and Wang Will Be ‘Game Changers’ in Bankman-Fried’s Trial, Lawyer Says: The testimony of the 2 FTX insiders might be damning for Bankman-Fried as he fights felony costs, in response to Ian McGinley, a companion at Akin Group.
Justice Department Launches Criminal Probe Into $400M FTX Hack: Bloomberg: Consultants have advised the digital fingerprints left by the alleged hacker factors to an inside job.
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