SBF faces 115 years in prison, Binance’s FUD and auditors quitting crypto: Hodler’s Digest Dec. 11-17
Top Stories This WeekFTX founder Sam Bankman Fried arrested and set to be extradited the US. Sam Bankman Fried was taken into custody on Monday by the Royal Bahamas Police Force. He is expected to remain there until February after his request for bail was denied in Bahamian courts. SBF has reportedly filed a second bail application in the Supreme Court of the Bahamas. After eight counts of fraud were filed against him by the United States government, his arrest was made. Bankman-Fried could be sentenced to 115 years imprisonment if he is convicted. However, legal commentators told Cointelegraph that there are still many details to the case. The domino effect of FTX’s collapse has also had a negative impact on the professional lives and careers of Bankman-Fried’s parents. Their Stanford Law School courses were cancelled. A class-action lawsuit was filed against Silvergate Bank in California regarding FTX. It seeks to hold the bank responsible for allegedly placing FTX user funds into Alameda Research’s bank accounts. Venture capital investor Kevin O’Leary claimed that Binance and FTX were at war and one put the other out business intentionally. O’Leary claimed that the hearing was part of a larger investigation into FTX’s collapse in which Binance played a significant role. Binance has been plagued by fear, uncertainty and doubt (FUD) in recent days, resulting in a drop of liquidity. Nansen, a crypto analytics firm, reports that Binance had net withdraws of more than $3.6 Billion between Dec. 7 and Dec. 13.
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Rep. Tom Emmer considers bringing back a bill to reduce crypto red tape. In light of the collapse in FTX, US lawmakers are under pressure to enact crypto regulations. Congressman Tom Emmer believes it is “probably a great time” to reintroduce a bipartisan bill to ease requirements for certain crypto projects and businesses to register as Virtual Asset Service Providers. The Blockchain Regulatory Certainty Act is a bill that aims to remove certain requirements and hurdles for “blockchain developers” and service providers. This includes miners, multisignature service providers, and decentralized finance platforms. Two of the most prominent auditors have abruptly stopped offering crypto auditing services. Mazars Group removed Binance’s proof-of reserve audits from its website, just days after it confirmed that the crypto exchange had 575,742 Bitcoin. Other crypto exchanges that use Mazars’ services such as Crypto.com or KuCoin were also affected by the decision. Mazars later explained that the pause was due “concerns about the way these reports will be understood by the public.” Armanino, an accounting firm, has also stopped providing crypto auditing services. Armanino worked with many crypto trading platforms such as OKX, Gate.io, and the embattled FTX Exchange. MetaMask will allow users to purchase and send Ethereum through PayPal. In another move into crypto, PayPal teamed up to allow Ether (ETH), purchase and transfer via its platform. By logging into the MetaMask app, users will be able to access their PayPal account and complete transactions.Initially, only selected PayPal users in the United States will be able to test the service. Other traditional payment companies are also looking to incorporate crypto into their services. Three trademarks were filed by Western Union in October for digital wallet management and exchanging digital assets. According to CoinMarketCap, the total market cap stands at $817.82 billion. Bitcoin (BTC) is at $16,826, Ether (ETH) at $1,194 and XRP at $0.35.
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Most Memorable Quotes
“Binance is a huge unregulated global monopoly right now, and they put FTX out business.”
Kevin O’Leary is a venture capital investor
“I thought it made sense. The principles were revolutionary and the ideas were brilliant, but the kid was only a teenager. […] Who was i to challenge that?
Danielle Cloud, former FTX employee
“Our experience with [crypto] platforms, FTX and others, is that they’re deliberately evasive. They are a way by which money laundering happens in large.”
Ashley Alder, chair of the United Kingdom’s Financial Conduct Authority
“Just like we protect our physical assets, so we must ensure that people protect their digital assets as well as personal information within the metaverse.”
Andrew Newman, chief tech officer and co-founder at ReasonLabs
“Looking ahead, pretty much everybody who could go bankrupt was bankrupt.”
Arthur Hayes, former CEO of BitMEXPrediction of the week Bitcoin falls below $17K due to ‘craziest myths’ about Binance sink BTC priceBitcoin dropped below $17,000 because traders were concerned that Binance’s FUD would trigger bearish BTC price action. According to Cointelegraph Markets Pro data and TradingView data, BTC/USD hit multi-day lows at $16,928 on December 16. The latest macroeconomic data from the United States and policy update provided by TradingView data showed that the pair has retraced its entire run back to its one-month highs. It’s interesting to see everyone suddenly so bearish about BTC as though it were only acting weakly. SPX is doing exactly what it did before, perhaps even worse,” commented Micha?l van de Poppe (founder and CEO of trading company Eight), questioning whether the Binance FUD really played a role in the markets. According to a report, Microsoft has quietly banned cryptocurrency mining from its online services to improve the stability of its cloud services, and protect customers against cyber fraud and attacks. These new restrictions were imposed on Microsoft’s universal licensing terms. They state that “mining cryptocurrency” is not allowed without prior Microsoft approval. Microsoft joins other cloud computing providers like Google in banning customers from mining cryptocurrency. Gemini was affected by a third-party incident that resulted in 5.7 million emails being leaked. Gemini appears to have been the victim of a data breach by a third-party vendor. According to documents obtained by Cointelegraph, hackers gained access to 5,701,649 line of information about Gemini customers’ email addresses as well as partial phone numbers. Gemini claims that the breach was caused and warned of ongoing phishing attacks. The database that was leaked did not contain any sensitive information, such as names and addresses. The United States Securities and Exchange Commission (SEC), filed a claim against eight people associated with Atlas Trading, a Discord-based forum, for alleged stock manipulation. According to the SEC, bloggers made at most $100 million by buying large positions in securities, recommending them and then selling their shares to take advantage of the demand generated by their “deceptive promotion.” The complaint did not mention cryptocurrencies or other digital assets. Most likely. Security experts believe that negotiating with hackers is a smart way of obtaining most of the stolen funds. Others argue that it is not wise to do so. Listen up! Cointelegraph launches 4 crypto podcasts. Want more crypto content? Cointelegraph’s new podcast section features four separate shows exploring a variety of impactful topics.Arthur HayesAtlas TradingBinanceBitcoinBitcoin ETFBitcoin PriceCrypto PodcastexchangesFTXGeminiKevin O’LearyMazarsMetamaskMicrosoftPayPalSBFSECStablecoinsRead also