Crypto News Headlines (23-Nov-2022)

Battles between crypto exchange titans has driven much of this month’s chaos in the industry. The latest salvo from Binance’s CEO appears to have been inaccurate.

On Tuesday, Binance CEO Changpeng “CZ” Zhao stepped into one of the biggest worries of the moment: doubts among some observers that Grayscale, operator of the biggest bitcoin trust, actually holds all the bitcoin it says it does. Grayscale, which – like CoinDesk – is owned by Digital Currency Group, has said those concerns are unwarranted. And Grayscale has been backed up by its partner Coinbase, the exchange that holds the bitcoin.

But Zhao tweeted numbers that, if they were true, would undermine Grayscale and Coinbase’s position. “Just stating ‘news reports,’ not making any claims,” he wrote in the now-deleted tweet.

While several traditional banking institutions are now offering or considering offering cryptocurrency-related services in Brazil, crypto-centric applications are also seeking to include traditional financial instruments in their services portfolio. Bitpreco, a Brazilian exchange, is now expanding its services to offer banking functions. The company is one of the largest in Brazil, accounting for 13% of all bitcoin transactions in the last three months.

Ney Pimenta, one of the partners at Bitpreco, explained that these new services, which will include payments, digital accounts, and even credit cards, will be offered through a new app called Bitybank. The objective of this inclusion is to drive more users to crypto through the offering of less niche-oriented services. On this, Pimenta explained:

Digital banking was a great success in Brazil. It is an extremely easy way to bring users to the crypto world with a full-service experience where they can buy, sell, withdraw, deposit, exchange for other assets, and experience DeFi, with the same ease of investing in savings.

New York Governor Kathy Hochul signed a two-year moratorium on new permits for proof-of-work (PoW) cryptocurrency mining operators that rely on carbon-based fuel to power their activities.

“The law will prohibit Environmental Conservation Law permits from being issued for two years to proof-of-work cryptocurrency mining operations that are operated through electric generating facilities that use a carbon-based fuel,” reads a memo for the bill.

Approved by the New York State Assembly in April, Senate Bill S6486D was passed by the New York State Senate in June this year.

The tweet became legendary in crypto. But now, following the collapse of FTX and Sam Bankman-Fried’s bankruptcy, the tables have turned.

Crypto mining and staking firm Foundry will buy two “turnkey” crypto mining assets with a total of 17 megawatt (MW) computing capacity from bitcoin miner Compute North, which filed for Chapter 11 bankruptcy protection in late September

Foundry will buy Compute North’s sites in North Sioux City, S.D. and Big Springs, Texas that have a fully operational capacity of six MW and 11 MW, respectively, according to a statement on Tuesday.

Compute North, one of the world’s largest bitcoin mining firms, said in September that it couldn’t fulfill debt obligations worth up to $500 million. Since then, its assets have been sold off to different entities, including its own lender, Generate Capital, which bought the company’s stake in two mega-mining facilities for $5 million, earlier this month.

Cryptocurrency lending firm Genesis Global Capital has reportedly hired a restructuring adviser to explore all possible options that include, but aren’t limited to, a potential bankruptcy.

It is understood that the firm has hired investment bank Moelis & Company to explore options, while people familiar with the situation have stressed that no financial decisions have been made and that it is still possible for the company to avoid a bankruptcy filing, according to a New York Times report on Nov. 22.

Interestingly, Moelis & Company was also one of the firms engaged by Voyager Digital after it suspended withdrawals and deposits on Jul. 1 in order to explore “strategic alternatives.”

Days later, Voyager Digital filed for Chapter 11 bankruptcy in the Southern District Court of New York as part of a reorganization plan that would eventually “return value to customers.”

Bitcoin turned green Tuesday, coinciding with the news that noted investor Cathie Wood’s Ark Investment Management bought $1.5 million in Grayscale’s Bitcoin Trust (GBTC) shares.

Bitcoin (BTC) was recently trading at about $16,100, up 0.9% in the past 24 hours. The largest cryptocurrency by market capitalization hit a two-year low of $15,480 Monday as jitters over trading firm Genesis’ future loomed over the market.

“It seems crypto traders are already pricing in a bankruptcy for crypto lender Genesis,” Edward Moya, an analyst at foreign-exchange broker Oanda, wrote in a note on Tuesday.

Austrian crypto exchange platform Bitpanda has secured “a crypto custody and proprietary trading licence for crypto assets from the German Federal Financial Supervisory Authority (BAFIN).” According to Bitpanda, securing the license means the crypto exchange has become the “first European retail investment platform to meet BAFIN’s strict regulatory requirements.”

In a statement, Bitpanda said the license allows it to extend its crypto custody and crypto assets trading services to German residents. Commenting on his company’s new milestone, Eric Demuth, CEO of Bitpanda, said:

Receiving the licence in Germany is the result of many months of hard work on the part of the entire Bitpanda team and took close cooperation with the team at BAFIN. It strengthens our position as a pioneer in terms of regulation in Europe and highlights yet again how well-positioned we are in this area. We want to give our customers a safe, secure and simple way to invest.

Bitcoin has recovered some ground after hitting its lowest price for two years yesterday, per CoinGecko.

The world’s largest cryptocurrency clawed its way back above the $16,000 mark and, on Wednesday morning, was trading 4.9% higher than a day earlier at $16,498.99.

Bitcoin hit its lowest point since November 2020 on Tuesday amid a perfect storm of high-profile bankruptcies, regulatory pressure, and short selling.

But the market was on the upswing by Wednesday, with most major coins in the green. The global cryptocurrency market cap was $862 billion, up 5.9% from a day earlier.

According to Bloomberg, Core Scientific Inc., the largest bitcoin mining company listed in the United States, said its losses increased to more than $1.7 billion in the first nine months of this year due to soaring energy costs and intense competition among miners has resulted in a sharp drop in profit margins.

Core Scientific, the largest US publicly-traded Bitcoin miner in terms of computing power, said its loss for the first nine months of the year climbed to over $1.7 billion

— Bloomberg Crypto (@crypto) November 22, 2022

The Austin, Texas-based company was one of the hardest hit miners with low Bitcoin prices sending mining revenue dropping to record lows.

The downfall of former crypto exchange FTX has had the entire industry in disarray since the situation began to unravel days before it declared bankruptcy on Nov. 11. A new op-ed from United States Senator Elizabeth Warren revealed a negative stance toward the industry with regard to the fallout.

Warren wrote that the crypto industry is on a “well-worn path of financial innovation,” which starts with exciting rewards but ends in “crippling losses.” She compared it to subprime mortgages of 2008, penny stocks and credit-default swaps.

The Senator said what happened with FTX should be a “wake-up call” to regulators to enforce laws on the industry.