Crypto News Headlines (07-Dec-2022)

Signature Bank (SBNY) will shrink its deposits tied to cryptocurrencies by $8 billion to $10 billion, signaling a move away from the digital asset industry for the bank that until recently had been one of the most crypto-friendly companies on Wall Street.

“We are not just a crypto bank and we want that to come across loud and clear,” Signature Bank’s CEO Joe DePaolo said at an investor conference in New York hosted by Goldman Sachs Group Inc. on Tuesday.

Nearly a quarter of the New York-based bank’s $103 billion in total deposits, or roughly 23.5%, came from the crypto industry as of September 2022. But given the recent “issues” in the space, Signature will reduce that amount to under 15% eventually, DePaolo said.

Ledger has revealed a new hardware wallet that’s roughly the same size as a credit card. Ledger Stax also features an e-ink touch screen that’s customizable and offers capacitive touch. The France-based crypto hardware wallet manufacturer is well known for creating hardware wallets such as the Nano. Similarly, Stax allows users to secure their cryptocurrency assets and non-fungible tokens (NFTs) in a EAL 5+ certified secure element-equipped setting.

The new machine was designed by Tony Fadell, an American engineer and former senior vice president of the iPod division at Apple. Reports explain that in 2001, Apple supported Fadell’s idea to create an MP3 player and online music store. That year, Fadell was hired to assemble and run the iPod and special projects division in April. Beside’s the iPhone, Apple’s iPod was one of the company’s most successful products. Fadell claims as far as crypto hardware wallets are concerned, he tested a number of competitors.

ApeCoin’s staking rewards are just around the corner, set to begin emitting on December 12, and the official staking contract has already taken in nearly $32 million worth of APE in one day—along with a wealth of Bored Ape Yacht Club and Mutant Ape NFTs.

More than 7.6 million APE have been deposited into the contract to date, along with a number of NFTs. That price has been ticking up since Horizen Labs launched the official staking contract on Monday, and now is up 6% over the last 24 hours at a current price of $4.16.

There is plenty of fear in the crypto market since Sam Bankman Fried’s digital assets exchange, FTX, went bust, so much so that digital assets have decoupled from the risk revival in traditional markets.

Yet bitcoin’s (BTC) dominance rate or the top cryptocurrency’s share in the total crypto market has held steady at around 40%, contradicting its record of rising sharply during times of stress.

According to observers, the stagnant dominance rate represents several developments, including an exodus of investors from the market.

“BTC has not outperformed the downside in recent months, so investors no longer view it as a safe haven,” Wes Hansen, director of trading and operations at crypto fund Arca, said in an email.

Most cryptocurrencies are likely to be regulated as securities in the United States according to the CEO of Intercontinental Exchange Inc (ICE), Jeffrey Sprecher, and Senator Elizabeth Warren.

The renewed focus on regulating cryptocurrencies as securities comes in light of FTX’s recent implosion, which wiped countless billions from the market, put consumer funds in limbo and soured crypto’s reputation among regulators and officials.

Speaking on Dec. 6 at the financial services conference by Goldman Sachs Group Inc, Sprecher — whose ICE operates the New York Stock Exchange — confidently stated crypto assets are “going to be regulated and dealt like securities.”

Smart contract auditing platform Sherlock predicted a $4 million loss for its stakers, about a third of the capital in its staking pool, because of Orthogonal Trading FTX-induced loan defaults on crypto lending protocol Maple Finance, the firm said Monday in a blog post.

Sherlock said it had deposited some $5 million USDC of its $12 million staking pool on Aug. 31 to the credit pool on Maple overseen by M11 Credit.

Orthogonal Trading’s insolvency, triggered $31 million of loans in the credit pool to default this week. The bad debt represents 80% of the credit pool’s outstanding loans. When Sherlock invested in the pool, however, Orthogonal’s borrowings only accounted for 14% of the pool’s loans.

The CEO of the Nasdaq-listed cryptocurrency exchange Coinbase (Nasdaq: COIN), Brian Armstrong, has slammed FTX co-founder Sam Bankman-Fried (SBF) for blaming his collapsed exchange’s $8 billion hole on an “accounting error.”

Bankman-Fried was asked in an interview with Bloomberg, published Friday, how he “misplaced $8 billion.” The former FTX boss replied: “Misaccounted.” He further explained that FTX customers sometimes wired money to his trading firm, Alameda Research, instead of sending it directly to FTX. The crypto exchange’s internal accounting system then double-counted the money, crediting it to both the exchange and the customers.

Many people do not believe Bankman-Fried’s excuse, including the CEO of Coinbase. Armstrong tweeted Saturday:

I don’t care how messy your accounting is (or how rich you are) — you’re definitely going to notice if you find an extra $8B to spend.

A pair of popular electronic musicians who are also prominent NFT backers are teaming up—and drawing inspiration from their respective CryptoPunks profile pictures (PFPs).

Steve Aoki and Justin “3LAU” Blau announced today that they have formed a supergroup via their Ethereum NFTs and will release new music under the name Punx. Though both are seasoned producers with their own respective sonic signatures, 3LAU tweeted that they plan to deliver a new style of electronic music through their Punx collaboration.

Although Punx will leverage the artists’ CryptoPunks NFTs, they won’t be launching NFTs of their own for this project—at least not at first. The pair previously released their first song together, “Jenny,” as an NFT in 2021.

Crypto companies are likely to find it harder and more expensive to get their promotional materials approved in the U.K. if proposals put forward by the country’s financial regulator are accepted.

The Financial Conduct Authority (FCA)’s two-month consultation, which kicked off on Tuesday, suggests limiting the number of firms able to approve marketing communications. It would withdraw approval authority from companies authorized under the Financial Services and Markets Act 2000 and require an additional level of authorization to allow the FCA to monitor this activity more closely.

“Historically, we have seen too many non-compliant promotions being approved and then communicated by unauthorized firms to retail consumers,” the consultation said.

The United States lawmakers have proposed an amendment to the State Department Basic Authorities Act of 1956 that includes information on crypto rewards and payouts.

The proposed amendment under the National Defense Authorization Act (NDAA) requires the Department of State, an executive department of the U.S. federal government responsible for the country’s foreign policy and relations, to inform about any crypto payouts or rewards within 15 days of making it.

The NDAA is the name for each of a series of United States federal laws specifying the annual budget and expenditures of the U.S. Department of Defense.

The official document read:

“Not later than 15 days before making a reward in a form that includes cryptocurrency, the secretary of State shall notify the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate of such form for the rewards.”