Regulators in the Bahamas Are Holding $3.5 Billion in FTX Customer Assets (CoinDesk)
"The Securities Commission of the Bahamas has taken custody of FTX deposits valued at more than $3.5 billion as of Nov. 12, according to a media release published late Thursday by the SCB. Shortly after FTX filed for bankruptcy, about $372 million worth of tokens were stolen from the exchange by an unknown actor thought to be an external hacker. Given media reports of a cyberattack on FTX, and possible looting of FTX-controlled wallets by former employees, the Commission said in its statement it "determined that there was a significant risk of imminent dissipation as to the digital assets under the custody or control of [FTX] to the prejudice of its customers and creditors.""
FBI Investigating 3Commas Data Breach (CoinDesk)
"The FBI is investigating the 3Commas data breach, CoinDesk has learned. The investigation comes after weeks of criticism from users of the Estonia-based crypto trading service, who say its CEO repeatedly brushed off warning signs that the platform had leaked user data. This week, 100,000 Binance and KuCoin API keys linked to 3Commas were leaked by an anonymous person. On Thursday, two 3Commas users told CoinDesk that they were contacted by agents from the FBI’s Cincinnati Field Office in connection to the leak."
FTX-Owned Liquid Announces Plan to Return Customer Funds (The Block)
"Liquid, a Japanese fintech firm owned by FTX, has released a plan on how the firm will return assets to customers. The return process will be specific to users who have FTX Japan and Liquid Japan accounts, according to a statement. "For the assets entrusted to us by our customers at FTX Japan and Liquid Japan, we are proceeding with system development so that withdrawals and withdrawals will be possible from the Liquid Japan web version. Specifically, you will be able to check your FTX Japan balance from the Liquid Japan web version, and then you will be able to withdraw/take out," Liquid said, according to a translated company release."
BITDAO’s Bit Token Rises 20% Ahead of $100 Million Buyback (The Block)
"The price of BitDAO’s bit token jumped more than 20% in less than 24 hours ahead of the expected approval of a $100 million buyback plan. The voting distribution for the proposal has already passed the minimum threshold and has 148 million yes votes, with no opposition. Unless something drastic happens prior to the Dec. 30 deadline at 11 p.m. EST, the vote should pass. The buybacks are slated to begin on Jan 1., and the DAO will purchase bit at $2 million in USDT a day for 50 days."
Galaxy Digital Pops Day After Argo Mining Acquisition Announcement (The Block)
"Galaxy Digital shares rose more than 13% a day after saying it would buy Argo Blockchain's Helios mining facility. The company will pay $65 million for the facility and will also provide a $35 million loan to Argo. Other crypto-related stocks saw mixed performances, with Silvergate down 1.4% and Coinbase up 0.8%. Traditional markets rose, with the S&P 500 closing up 1.75% and the Nasdaq up 2.59%. Bitcoin and ether were higher, up 0.8% and 1%, respectively, over the 24 hours before 5:30 p.m. EST."
Binance Warns About 3COMMAS API Leak, Says Users Should Disable Keys (The Block)
"Binance CEO Changpeng Zhao said he's "reasonably sure" there were "wide spread API key leaks" from trading-bot platform 3Commas after fresh speculation about an October incident emerged on social media on Wednesday. A 3Commas spokesperson confirmed the leak in a statement to The Block. "I strongly believe @tier10k is correct here," he wrote on Twitter, referring to a post from a user that said an API leak had been published. "If you have ever put an API key in 3Commas (from any exchange), please disable it immediately.""
China to Launch First National ‘Digital Asset’ Marketplace (CoinDesk)
China is launching its first state-backed non-fungible token (NFT) marketplace, the latest sign of embrace for a technology that has occupied a legal gray area within the country’s notoriously strict regulations on cryptocurrency. A ceremony celebrating the launch of the marketplace will be held in Beijing on Sunday. The platform will be run by three state-owned and private entities, including China Technology Exchange and Art Exhibitions China, both of which are government-backed, and Huban Digital, a private company, according to a report by Chinese state media outlet China Daily."
Crypto Exchange Gemini Sued by Investors Over Interest-Earning Program (CoinDesk)
"Crypto exchange Gemini is being sued by investors over the sale of its interest-earning crypto products, court filings from Tuesday show. Investors Brendan Picha and Max J. Hastings filed a class-action lawsuit on behalf of themselves and "others similarly situated" with the U.S. Southern District Court of New York. They are seeking a trial by jury, according to the complaint."
FTX Customers File Class Action Suit to Have Their Payments Prioritized (The Block)
"Four FTX customers filed a class action lawsuit demanding priority in repayment, citing $2 billion in customer funds which have gone missing. The suit was filed in the U.S. Bankruptcy Court for the District of Delaware, where FTX's bankruptcy proceedings are ongoing. Retail customers who suffered financial losses following the bankruptcy filing of FTX and sister company Alameda Research “should not have to stand in line” with other creditors waiting for fund recovery, the complaint argues."
Bankman-Fried Arraignment in New York Set for Next Week (The Block)
Disgraced FTX founder Sam Bankman-Fried will be arraigned by the U.S. District Court for the Southern District of New York next week. Court documents set Bankman-Fried's arraignment on Jan. 3. Bankman-Fried faces two charges of wire fraud and six counts of conspiracy. Associates of Bankman-Fried, Caroline Ellison and Gary Wang, are already cooperating with prosecutors on their roles in misleading investors about the nature of the relationship between FTX and linked trading firm Alameda Research. Those pleas likely provided the court with information about Bankman-Fried's activities."
US Probes How $372 Million Vanished in Hack After FTX Bankruptcy (Bloomberg)
"Federal prosecutors are investigating an alleged cybercrime that drained more than $370 million out of FTX just hours after the cryptocurrency exchange filed for bankruptcy last month. The Department of Justice has launched a criminal probe into the stolen assets that is separate from the fraud case against FTX co-founder Sam Bankman-Fried, according to a person familiar with the case who asked not to be identified as the investigations are still ongoing. US authorities have managed to freeze some of the stolen funds, the person confirmed. However the frozen assets only represent a fraction of the entire loot."
Mango Markets Exploiter Arrested in Puerto Rico for Alleged Market Manipulation (The Block)
"Authorities are not buying that code was law in the $114 million exploit of a decentralized exchange. Federal authorities have arrested Avraham Eisenberg in Puerto Rico for his exploit of decentralized exchange Mango Markets, unsealing charges against him in the U.S. District Court for the Southern District of New York. Eisenberg was charged with commodities fraud and commodities manipulation, the complaint shows."
Crypto Investment Firm Midas Shutting Down Platform Following Losses (CoinDesk)
"Midas Investments, an investment firm that focused on DeFi (decentralized-finance) yields, is shutting down its platform following its losses this year, according to a blog post from CEO and founder Iakov “Trevor” Levin on Tuesday. Levin wrote that this past spring, the Midas DeFi portfolio lost $50 million, or 20% of its $250 million in assets under management, and that after the collapse of crypto lender Celsius Network and exchange FTX, 60% of the assets on Midas' platform were withdrawn."
Bankman-Fried’s Criminal Case Assigned to Judge in Trump, Prince Andrew Cases (Reuters)
"Sam Bankman-Fried's criminal case over the collapse of his FTX cryptocurrency exchange has been reassigned to a judge recently known for handling defamation lawsuits against former U.S. President Donald Trump and a sexual abuse lawsuit against Britain's Prince Andrew."
Pudgy Penguins NFTs Break All-Time Highs With Holiday Rally (CoinDesk)
Pudgy Penguins NFTs are on a Christmastime tear. The Ethereum-based non-fungible token (NFT) lineup has eclipsed Bored Ape Yacht Club (BAYC) and other so-called “blue chip” digital collectibles in 24-hour trading volume – its 1,200 ETH is nearly double that of the runner-up, BAYC, according to data site Nansen. That surge in trading activity comes as Pudgy Penguins sets new all-time highs in terms of ETH-denominated floor price, a popular metric. At press time, the lowest asking price for a “Pengu” on NFT trading hub OpenSea was 7 ETH. That’s a 32% jump in 24 hours, per Nansen."
SEC Heightening Scrutiny of Auditors’ Crypto Work (WSJ)
"The Securities and Exchange Commission is stepping up scrutiny of the work that audit firms are doing for cryptocurrency companies, concerned that investors may be getting a false sense of reassurance from the firms’ reports, a senior official at the regulator said. “We’re warning investors to be very wary of some of the claims that are being made by crypto companies,” Paul Munter, the SEC’s acting chief accountant, said in an interview."
Judge Pulls Out of SBF-FTX Case Citing Husband’s Law Firm’s Advisory Link (Cointelegraph)
"The ongoing legal proceedings around former FTX CEO Sam Bankman-Fried (SBF) took a new turn as District Judge Ronnie Abrams withdrew her participation from the case. The United States District Court for the Southern District of New York recused itself from the FTX case after revealing that a law firm — which employs Abrams’ husband as a partner — had advised the crypto exchange in 2021. In a Dec. 23 filing, Judge Abrams revealed that her husband, Greg Andres, is a partner at Davis Polk & Wardwell, a law firm where he has been employed since June 2019. Additionally, it was highlighted that the law firm had advised FTX in 2021."
FTX Asks Court for Help in Battle Over $450 Million in Robinhood Shares (The Block)
"Defunct crypto exchange FTX has sought assistance from a U.S. bankruptcy court in an ongoing fight over ownership of about $450 million in Robinhood Markets stock. Specifically, 56 million shares are owned by Emergent Fidelity Technologies, an entity 90% owned by disgraced FTX founder and former CEO Sam Bankman-Fried and organized in Antigua and Barbuda, according to a court filing. The parties trying to gain control of the Robinhood shares — frozen on brokerage ED&F Man Capital Markets in November — are failed crypto lender BlockFi, FTX creditor Yonathan Ben Shimon and Bankman-Fried."
Fidelity Files for Metaverse Trademarks in Latest Crypto Push (The Block)
"Fidelity has filed three U.S. trademark applications to provide services in the metaverse and other virtual worlds in its latest step into the realm of digital assets. The firm wants to provide its traditional services in alternate realities, according to the filings. The applications mention NFTs and NFT marketplaces, virtual real estate investing, crypto trading and metaverse investment services. Fidelity has been quicker to embrace digital assets than most other large investment companies and in October said it was planning 100 more crypto hires to expand its digital asset team to 500. The firm opened up commission-free retail crypto trading accounts in November after first announcing a waiting list."
Nexo Terminates Potential Deal With Troubled Crypto Lender Vauld (The Block)
"Crypto lender Nexo, which was in talks with rival crypto lender Vauld to potentially acquire it, has terminated the discussions. The potential deal has fallen through after six long months of dialogue, according to a source with direct knowledge of the matter and an email obtained by The Block. The email, dated today and sent by Vauld founder and CEO Darshan Bathija to the firm's creditors, states that "our discussions with Nexo have unfortunately not come to fruition.""