FTX Collapse Claims Another Victim

GM Readers! It's a new day. Time to jump on the morning train.

Today's selection:

• Genesis - Latest FTX Victim
• SBF Tweets
• FTX In The Big Picture
• Selected Meme of The Day
• Bite-Sized News

GENESIS GOING DOWN

Another one bites the dust. At least it appears so.Genesis Trading, a digital currency trading and lending company, has just announced something unnerving.

And when a crypto company is referring to the FTX crash... you know this means no good.

What is happening: Genesis' Crypto Lending Unit is halting withdrawals on their platform. Refers to FTX collapse as the reason behind their hardships.

Genesis Global Capital is the name of the unit. At the end of 2022's third quarter, they had $2.8 billion in total active loans.

After FTX fell, Genesis Trading revealed that they ended up with $175 million in locked funds on FTX. It's far from certain that they're getting it back.

People started withdrawing. And continuous withdrawals Sudden would have left them bare-footed on winter's ice.

Even though Genesis Trading is an independent lending unit that operates separately from Genesis Global Capital, the news still communicate trouble on their front.

Gemini, the crypto exchange, is also affected by this. They have a partnership with Genesis.

'We are working with the Genesis team to help customers redeem their funds from the Earn program as quickly as possible', Gemini spokesman said.

FUD is all knocking at the door. Naturally, they'll do what's in their power to dissolve it.

But there's more.

The parent company of Genesis is Digital Currency Group. It's also the parent company of Grayscale.

Grayscale is one of the largest holders of bitcoin, worth $11B.

Such distress signals could activate the reaction chain. And it would lead to further collapse.

Everything started with people panicking and withdrawing their assets in favour of something safer, like cold-storage wallets. Liquidity problems ensue.

Let's see how the story develops, let's hope that it's going to be only temporary. If not, the domino effect will continue, claiming new victims, new losses, new fear.

TL;DR: Crypto trading company Genesis announced that their lending unit has frozen client withdrawals. They blame FTX collapse for this.

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SBF TWEETS

Yesterday we wrote about the 'Crypto King' becoming the 'Cryptic King'. About how SBF tweeted some eyebrow-raising, odd stuff.

Well, today he expanded the unusual thread. But this time it was comprehensible.

SBF summarised the circumstances that he currently finds himself in. He made his goal public:

'My goal—my one goal—is to do right by customers. I'm contributing what I can to doing so.'

So SBF announced his 'only goal'. But... in the following tweet he mentioned two more goals:

As the thread unfurls, SBF shares his ambitions:

'What can I try to do? Raise liquidity, make customers whole, and restart,' states SBF. And then, he adds:

'Maybe I'll fail. Maybe I won't get anything more for customers than what's already there.'.

And then, he ends the thread with aplomb:

The reactions were... not entirely supportive.

But that's the SBF's perspective. There are other takes. More critical, more demanding, less forgiving.

TL;DR: SBF shared what he's going through in a series of personal tweets. The audience wasn't too convinced.

FTX. THE BIG PICTURE

It's not only SBF that spoke his mind on Twitter. Everyone's doing that. Some takes are hotter than others, and some people's insights are sharper than others'.

Heavy-weight crypto commentator, investor, entrepreneur Balaji Srinivasan whose Twitter handle is @balalis, has recently shared a thread about what FTX story reveals.

And... It's an explosive read. 'Why is legacy media protecting SBF?' Balaji asks in the beginning.

'He bought them, with what may have been stolen customer funds', he continues.

In an in-depth analysis, Balaji lays out his arguments, insights about SBF, allegedly, taking FTX customers' money, and giving it to media corporations.

It has already been proven that SBF gave millions of dollars to such banes as Vox, ProPublica, Semafor, Intercept.

And, as Balaji says, it's just the tip of the iceberg. Because FTX has a '$10 billion hole' in customers' funds. Funds that evaporated. Somewhere.

He insists that this money is working in SBF's favour. Today's silence was paid for yesterday. With stolen funds.

The FTX story is an unprecedented case. What we know today is just the tip of the iceberg. We'll be hearing many more updates about this topic for months to come.

TL;DR: Crypto analyst Balaji Srinivasan shared insights about how and why the media is silent about SBF. He states that SBF used customers' funds to silence it.

SELECTED MEME OF THE DAY

BITE-SIZED NEWS

• After Draining FTX, Hacker Becomes the 35th Largest Ethereum Holder. Sinister achievements.
• Crypto Lender BlockFi is Reportedly Preparing for Potential Bankruptcy. Dominos continue falling.
• USDC Stablecoin Issuer Circle Adds Support for Apple Pay. Hooray for global adoption.
• Nike to Launch Its Web3 Platform, Dubbed .SWOOSH. The latest web3 drip.
• Federal Reserve Bank of New York Rolls Out 12-Week Proof-of-Concept CBDC Pilot. Step by step. Not everyone likes that.