| Here's your daily Inside Cryptocurrency briefing: - 🤝 BlockFi's in-principle agreement with FTX to resolve its claims against the bankrupt crypto exchange,
- 🏆 The recipients of CoinMarketCap's first crypto awards,
- 👮 South Korean authorities' request for help from Interpol for Do Kwon's extradition, and more.
Enjoy your reading! Doğa
p/dogayurduneri | |
| 1 | | Bankrupt crypto lender BlockFi has reached an in-principle agreement with the bankrupt crypto exchange FTX and its sister company Alameda Research to settle its claims against the two firms. As part of the deal, FTX and Alameda Research agreed to pay $874.5M to BlockFi and waive all their claims against the company. More: - The settlement will resolve BlockFi's claims against FTX and Alameda Research and see BlockFi customers receiving their claims at full value.
- The $874.5M figure includes a $185.2M claim against FTX for BlockFi customers' assets held on the exchange and a $689.3M claim against Alameda Research for the loans the sister firm received from BlockFi.
- A $250M portion of the total sum will be treated as a secured claim and be prioritized after FTX officially exits bankruptcy when its reorganization plan, filed in December 2023, is approved by creditors.
- The remaining amount will be paid like other similar claims against FTX, depending on the bankrupt exchange's ability to repay its own customers and creditors.
- BlockFi's bankruptcy administrators said they achieved the deal through early mediation, ensuring that the money to be spent on litigation is directed to fund distribution to customers.
- The in-principal agreement is still subject to the approval of U.S. Bankruptcy Judge John Dorsey.
Zoom Out: - FTX, previously the third-largest crypto exchange, filed for Chapter 11 bankruptcy in November 2022, with all the 130 entities under the roof of FTX Group, following the claims that the former CEO, Sam Bankman-Fried (SBF), used customer funds in FTX to compensate for losses at Alameda Research.
- In the same month, BlockFi also filed for Chapter 11 bankruptcy, citing the volatility in the crypto market and its exposure to the collapse of FTX.
- The two companies sued each other last year, filing their claims.
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| 2 | | 
What the numbers say: Gold, the largest asset by market cap, recently hit a new all-time high in the U.S. dollar (USD), maintaining its upward trend. The first price record within the week came on Tuesday, with $2,130 per troy ounce. However, the asset further renewed this record, and its price reached as much as $2,164 in spot markets on Thursday, up from $2,034 a month earlier. Relevance: Bitcoin (BTC), the largest cryptocurrency by market cap, also hit a new all-time high above $69,000 on Tuesday this week, surpassing its previous price record in November 2021. The new all-time highs marked the first time Bitcoin and Gold hit new price records simultaneously since the emergence of Bitcoin in 2009. Historically, the popular cryptocurrency has been defined as digital gold many times. The simultaneity in the price records has reinforced this description once more, bringing Bitcoin another correlation related to traditional finance and increasing investor confidence in the token. Brands that should care: The new all-time high in Bitcoin's price was mainly triggered by the huge investor interest in recently launched spot Bitcoin exchange-traded funds (ETFs) in the U.S. The new investment products were approved by the U.S. Securities and Exchange Commission (SEC) and began trading in January. However, the funds managed to reach record daily trading volumes of billions of dollars only within two months. The Bitcoin ETF issuers in the U.S. include some of the largest traditional financial services firms, such as Fidelity, Franklin Templeton, Valkyrie, Ark Invest, Grayscale, BlackRock, WisdomTree, and Invesco Galaxy. | | | |
| 3 | | The U.S.-based business intelligence firm MicroStrategy has upsized its convertible senior note offering, intended to add more Bitcoin (BTC) to the firm's digital asset reserves, from $600M to $700M. The move came several days after the firm first announced its plans to raise $600M by selling convertible senior notes to purchase additional Bitcoin. More: - Convertible senior notes are a type of security that allows the purchaser to convert the note into a predefined amount of the issuer's shares.
- MicroStrategy's notes will be offered only to qualified and institutional investors.
- The notes will also generate a 0.625% interest annually and come due in 2030.
- The conversion price for the notes will be $1,497.68 per share, representing an over 20% increase from the current trading price of MicroStrategy's shares at around $1,230.
- Holders of the notes will be able to require MicroStrategy to repurchase their notes on Sept. 15, 2028, or if an event constituting a fundamental change occurs at a repurchase price equal to 100% of the principal amount of the notes.
- MicroStrategy will be able to redeem the notes after March 22, 2027, by repaying the notes' principal amount and any accrued interest in cash if its common stock trades consistently above 30% of the determined conversion price.
- The firm is currently the largest corporate Bitcoin holder, with its reserve of 193,000 BTC worth around $13B at current prices.
Zoom Out: - MicroStrategy began its Bitcoin purchases in 2020 and boosted its reserves, especially last year.
- Last month, the company's crypto advocate co-founder and executive chairman, Michael Saylor, stated that it does not plan to sell any of the firm's Bitcoin holdings and intends to continue to buy additional bitcoins.
- Saylor also recently said MicroStrategy will rebrand as a Bitcoin development company to reflect its strategy to accumulate more Bitcoin and promote the growth of the Bitcoin blockchain network.
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| 4 | | South Korea's National Police Agency has requested assistance from the International Criminal Police Organization (Interpol) in extraditing Do Kwon, the co-founder of the collapsed Terra ecosystem, to South Korea from Montenegro. The request was sent to the Interpol's General Secretariat through an electronic document. More: - South Korea's Ministry of Justice also requested similar help from Interpol, though the documents have yet to receive a response.
- Kwon is currently under detention in Montenegro, where he was arrested in March 2023 while trying to fly to Dubai carrying falsified traveling documents.
- Since his arrest, both the U.S. and South Korea have sought Kwon's extradition to try him on various charges, including fraud, securities law violations, deceiving investors, racket collecting, and building a Ponzi scheme.
- Neither country has a direct extradition treaty with Montenegro.
- Montenegrin courts ordered Kwon to be extradited to the U.S. several times, but these orders were overturned by the appellate court, which accepted appeals filed by the lawyers for Kwon.
- Most recently, a Montenegrin court ruled that the Terra co-founder would be extradited to South Korea, which would probably face another appeal by Kwon's legal team.
- In its request, the National Police Agency underlined that South Korea requested Kwon's extradition first, ahead of the U.S.
- Interpol previously got involved in the process once more when it issued a red notice for Kwon in September 2022, urging law enforcement agencies worldwide to locate and arrest the co-founder.
Zoom Out: - The multibillion-dollar Terra ecosystem collapsed in 2022 after the prices of its native tokens, Luna and TerraUSD, plummeted nearly to zero in May and lost all their value against the U.S. dollar (USD).
- The downfall caused over $60B to be wiped off the crypto market, triggering a prolonged crypto winter.
- Terraform Labs, the firm behind the ecosystem, filed for bankruptcy in January this year, reporting both assets and liabilities in the range of $100M to $500M.
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| 5 | | Crypto-focused hedge fund Pantera Capital has started raising money from its investors to purchase the Solana (SOL) tokens held by the bankrupt crypto exchange FTX at a discounted price. The firm's Pantera Solana Fund will be able to buy up to $250M of SOL from FTX. More: - The tokens will be purchased for $59.95, a price 39% below the SOL token's 30-day average price.
- Each investor must invest at least $25M to participate in the fund.
- Investors must also agree to a vesting period of as long as four years, meaning that the purchased tokens will be initially locked, and the ownership of their benefits will be gradually distributed over four years.
- Pantera Capital will charge a 0.75% management fee and a 10% performance cut.
- The move will allow FTX's new management to dispose of its SOL holdings and increase its cash amount, which would be distributed to its creditors, without putting immediate pressure on the SOL's price.
- FTX currently holds $5.1B of SOL tokens, which accounts for roughly 10% of the total supply.
- SOL increased its value by 650% over the past 12 months and four times since FTX filed for bankruptcy in November 2022.
Zoom Out: - In January, FTX attorneys announced that FTX intends to fully reimburse its customers and creditors, stating that the bankrupt firm abandoned its plans to relaunch its crypto exchange.
- Since then, the firm has accelerated its efforts to recover more funds and increase its cash to fully repay its creditors.
- FTX's co-founder and former CEO, Sam Bankman-Fried (SBF), was a major backer of Solana, the blockchain network behind the SOL token.
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| 6 | | Crypto market data platform CoinMarketCap has recently announced the winners of its first CMC Crypto Awards after a 10-day evaluation process. The committee has considered the results of online voting, data analysis, and expert reviews while determining the recipients of the awards. More: - The event made a selection among individuals, products, and initiatives currently trending in the Web3 industry.
- The awards ceremony was streamed live on Wednesday.
- The ceremony distributed awards in eight categories: Crypto of the Year, Bridge Builder of the Year, Meme Coin of the Year, Social Influencer to Watch, Most Innovative L1/L2/Cross-Chain Project, Most Innovative NFT & Gaming Project, Most Innovative DeFi Project, and Crypto Leader of the Year.
- The recipients of the first seven categories have become Solana, BlackRock, Bonk, ZachXBT, Celestia, Pudgy Penguins, and Uniswap, respectively.
- Notably, the Crypto Leader of the Year category rewarded all its nominees, including Vitalik Buterin, Ryan Selkis, Brian Armstrong, Changpeng Zhao (CZ), and Julia Leung.
- CoinMarketCap CEO Rush Luton said it was impossible to pick just one winner for the category since all five of the nominees have contributed to the industry so much over the last 12 months in very different ways.
- The awards of all the winners have been immortalized as NFTs on the Ethereum blockchain network.
Zoom Out: - The CMC Crypto Awards was backed by some of the most well-known firms in the crypto industry, such as Binance, Coinbase, and Trust Wallet.
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- The U.S. state of Arizona's senate has started reviewing a proposal to add spot Bitcoin (BTC) exchange-traded funds (ETFs) to two of the state's retirement systems as an investment tool.
- Recent court filings have revealed that the U.S.-based crypto exchange Gemini and the now-defunct crypto lender Genesis Global discussed a potential merger in October 2022.
- Web3 app store Magic Square has announced that it allocated $66M of its native SQR token as grants for projects listed on its platform.
- India's National Informatics Centre (NIC), a state agency in the country, has disclosed that 7.93 million governmental documents are currently hosted across five blockchains.
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 | Staff Writer | | Doga is a tech and science editor who has been writing news for nearly 10 years. She worked for leading tech platforms and mainstrem media channels as an editor and presenter throughout his career. Then, she carried her know-how to more than one platform. She is a part-time cat lover and binge-watcher, and also fond of science, space, and emerging tech. She always has a story to tell. She is a bit addict to the laughter and -unfortunately- the '90s culture. | | This newsletter was edited by Aaron Crutchfield | |
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