Crypto News Headlines (12-Oct-2022)

Crypto hosting and mining company Core Scientific (CORZ) has said it intends to pursue what it feels it is owed by Celsius Mining, the mining affiliate of the beleaguered crypto lender.

The firm said in a U.S. Securities and Exchange Commission (SEC) filing on Wednesday that it “intends to vigorously defend its interests” and that it has retained legal advisors to assist it with relation to Celsius Mining.

“An adverse or untimely ruling by the bankruptcy court that provides Celsius the benefits of the Company’s hosting services without Celsius fully paying the costs of such services would have a material effect on the Company’s business, financial condition, results of operations and cash flows,” the firm said.

Core Scientific provides hosting services to Celsius Mining, for which it claims to be owed around $5.4 million. Along with its parent company, Celsius Mining filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York in July.

Alphabet Inc.’s Google Cloud and the Nasdaq-listed crypto exchange Coinbase announced Tuesday “a new, long-term strategic partnership to better serve the growing Web3 ecosystem and its developers.”

Under the agreement, Coinbase will use Google Cloud to build its advanced exchange, grow data services, and process blockchain data at scale. The exchange will also leverage Google’s fiber-optic network to enhance the global reach of its crypto services.

In addition, Coinbase will build its global data platform on Google Cloud’s infrastructure and leverage the internet giant’s data and analytics technologies to provide Coinbase customers with machine learning-driven crypto insights, the announcement details, elaborating:

As part of the partnership, Google Cloud is positioned to enable select customers, starting with those in the Web3 ecosystem, to pay for its cloud services via select cryptocurrencies.

Several tokens powering some of the industry’s biggest Layer-1 protocols, including Cardano, Solana, and Avalanche, are among the worst affected by the latest bear market, dropping hefty value over the past week.

Cardano (ADA), the eighth-largest cryptocurrency by market cap, is down 9.5% over the last week, trading about $0.395 by press time, data from CoinGecko shows.

The Cardano blockchain went through a major upgrade with the Vasil hard fork in September, which introduced a host of new features, including an optimized code base and reduced transaction times.

Yet, the upgrade failed to boost the price of ADA, which is now down 22.5% over the last month, and almost 82% since the start of the year.

The crypto community is in uproar over the recent news that the beleaguered DeFi protocol Celsius Finance has revealed the wallet addresses and transaction details of thousands of its users in a court filing.

The filing was submitted to a judge last week as part of bankruptcy proceedings involving Celsius. It contains more than 14,500 pages listing the financial transactions of its entire user base, including those of its founders Alex Mashinsky, Dan Leon and Nuke Goldstein. In addition, customer names, transaction dates, account types, assets and other information is included in the disclosure, as well as the amounts send.

Celsius did at least redact the addresses of its users in the submitted documents, but the crypto community was quick to voice its dismay on Twitter, warning that many of Celsius’s users could end up being “doxxed” if hackers are able to link the exposed accounts to an individual.

“The @CelsiusNetwork bankruptcy court filing is the worst breach of user #privacy in #web3 history. Over 14,000 pages of identifiable user information and transaction history,” said Manta Network co-founder Kenny Li in a tweet.

21Shares, a major global provider of cryptocurrency exchange-trading products (ETP), is debuting a physical Bitcoin (BTC tickers down $19,121) ETP in the United Arab Emirates.

The new 21Shares Bitcoin ETP has started trading on the international financial exchange Nasdaq Dubai under the ticker ABTC, the firm announced on Oct. 12.

The newly launched crypto product is physically backed, which means that it’s fully collateralized by the underlying Bitcoin assets they track with 1:1 leverage, 21Shares co-founder and CEO Hany Rashwan told Cointelegraph. The ETP’s underlying crypto assets are deposited in an offline wallet to ensure better security, he noted.

21Shares’ expansion into the UAE is a major milestone in the company’s international growth. Including Nasdaq Dubai, 21Shares’ ETPs are listed across 12 exchanges, including SIX Swiss Exchange, Deutsche Börse, EuroNext, BXSwiss, Wiener Börse, Quotrix, Gettex, Börse Stuttgart, Börse München, Börse Düsseldorf and Nasdaq.

Crypto mixers are a challenge for the U.S. Department of Justice (DOJ) but they haven’t “necessarily slowed us down,” the chief crypto prosecutor at the law enforcement agency said Tuesday.

Eun Young Choi, the director of the DOJ’s national crypto enforcement team, told the audience at DC Fintech Week that enforcing the laws against crimes with a crypto component is “no different than a lot of other activities.”

Investigators have to trace funds and either wait for them to move to track them back to perpetrators or move quickly to identify a lead, she said.

While mixers and other automated tools cause challenges for the DOJ, they are not slowing investigators down, Choi added, responding to a question by moderator and conference organizer Chris Brummer.

The Nasdaq-listed crypto exchange Coinbase announced Monday that it has received “In-Principle Approval (IPA) as a major payments institution license holder from the Monetary Authority of Singapore (MAS).” The announcement details:

This license will allow us to offer regulated digital payment token products and services in the island state.

“Today’s announcement underlines our commitment to Singapore as a regional hub,” Coinbase stressed. “Singapore serves as the hub for Coinbase’s APAC institutional business … Gaining this in-principle approval from MAS is an important step, as we plan to launch our full suite of retail, institutional and ecosystem products. Singapore plays a critical regulatory and commercial role in APAC and beyond, and serves as our global talent hub; we are excited to continue investing and building for the crypto economy here.”

Coinbase explained that it has been quietly increasing its presence in Singapore for some time now. The company announced Singapore as a tech hub last year and Coinbase Ventures has invested in over 15 Singapore-based Web3 startups in the past three years.

Crypto asset manager Valkyrie Funds said Tuesday it will liquidate its Balance Sheet Opportunities ETF (VBB), a bitcoin bull-focused investment vehicle that fizzled during its less than one year life.

The fund will be liquidated at the end of October, said the company in a statement, and then delisted from Nasdaq, where it has traded since December 2021. Investors who hold the ETF through liquidation will get a cash redemption for the value of their shares, according to regulatory filings.

The fund’s dissolution “was the best course of action,” Valkyrie said, noting the decision to cut it was “part of an ongoing review of products aimed at ensuring the firm best meets client demand.”

Investors never showed much demand for Valkyrie’s third ETF, where the largest positions are Tesla (TSLA) and MicroStrategy (MSTR), companies known for holding bitcoin on their balance sheets. Net assets under management are currently only about $570,000, a miniscule number for ETFs.

Acting Comptroller of the Currency Michael J. Hsu urged his fellow regulators not to lower their standards when dealing with crypto under the pressure of “being perceived as anti-innovation luddite.” According to the OCC, it’s necessary to “learn and smartly adapt” to ensure safety, soundness, and fairness regarding the industry.

Hsu made his remarks on crypto during his speech at the Harvard Law School on Oct. 11. The full text of the speech was published on the OCC’s official website.

Having started from his private experience example, Hsu criticized the rush and fear of missing out (FOMO) syndrome, which, in his opinion, heavily influenced the regulator community when it comes to crypto:

“Promises of innovation and inclusion often mask crypto’s promotion of a gold rush vibe that exploits people’s fear of missing out on the next Google or Amazon.”

Although bad news for the companies involved, bankruptcies, liquidations, and tokens going to zero have created myriad opportunities for accounting firms like Armanino.

The company, founded in 1969, started looking at providing services to crypto firms back in 2014, and has since built out an entire suite of products under the umbrella of its TrustExporer brand.

“The stuff that happened over the summer really was like what we’ve been planning for and trying to talk to people about,” Clayton Lowery, a senior blockchain manager, told Decrypt at the Chainlink SmartCon event in New York. “It took a couple years and, unfortunately, for a few bad things to happen. But that’s really what we’re seeing. We’re seeing so many people come in.”