Crypto trading/market thread

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Hong Kong is warming up to crypto, and a licensing regime for Virtual Asset Service Providers (VASP) – the local term for crypto exchanges – kicks in on June 1.

Does this mean crypto is going "fully legal" then in the city for everyone, as a tweet suggests? Not at all.

While the situation may change later, for the time being the VASP framework for licensing exchanges, which just finished a multiyear consultation, allows them to provide access only to accredited professional investors. Retail investors are excluded.

The Hong Kong government has indicated that the Securities and Futures Commission (SFC), its securities regulator, may consider retail access to virtual asset services in the future, after further consultation.
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No, Hong Kong Won’t Be Allowing Retail Traders Access to Crypto on June 1

A tweet suggesting the city will make crypto fully legal for all citizens is a misreading of the legislation.

www.coindesk.com

 

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Wish I had thought of building this bridge:

MetaMask users can now buy crypto with fiat directly from their wallets

ConsenSys has partnered with Mercuryo to enable MetaMask users to buy crypto with bank cards, Apple Pay, and various bank transfer methods directly from their wallets.

www.kitco.com

 

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Some analysis suggests the Shanghai upgrade for Etherium will not lead to significant sell off event:

New Research Examines Impact of Incoming Ethereum Update That Will Enable Staked ETH Withdrawals - The Daily Hodl

New research is examining the possible impacts of investors having the ability to withdraw their staked Ethereum (ETH) next month.

dailyhodl.com

 

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(Kitco News) - Amid a crackdown on the crypto industry in the U.S. with a focus on cryptocurrency exchanges, Coinbase is reportedly in talks with stock exchange platform IEX to create a federally approved digital asset marketplace, according to people familiar with the matter.

Coinbase and IEX look to launch the first federally regulated U.S. crypto exchange

Coinbase is reportedly in talks with the stock exchange IEX and the SEC to create a federally approved digital asset marketplace in the U.S.

www.kitco.com

 

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A town official allegedly set up a secret cryptocurrency mining operation in a crawl space under a Massachusetts school, according to police.

Town official set up secret cryptocurrency mining operation in crawl space at local school, police say

 

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Crypto markets likely facing some significant headwinds thanks to unraveling fraud and/or government regulators choking out business.

Silvergate Capital (SI) was downgraded to “Underweight” from “Neutral” by JPMorgan (JPM) after the crypto bank said that it was evaluating its ability to continue as a going concern and delayed the filing of its annual report on Wednesday.

The crypto-friendly bank said it needed to delay the filing of its annual 10-K for the 2022 fiscal year, and would take an additional two weeks to complete it.

The Wall Street giant also withdrew its price target for the stock, which was $14 a share previously. Silvergate shares fell 47% to $7.18 in premarket trading.

Silvergate’s rating was also downgraded to “Hold” from “Buy” by Canaccord Genuity. The broker also cut its price target on the stock to $9 from $25.

JPMorgan notes that in the recent quarter Silvergate realized a $886 million loss from selling underwater securities, resulting in tangible book value (TBV) being cut more than half to $12.93.

“With the company having sold additional securities (beyond what was guided) as a loss in January/February, this reflects that the company is facing continued liquidity challenges,” JPMorgan analysts led by Steven Alexopoulos wrote.
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Silvergate Downgraded by JPM, Canaccord Amid Doubts of Bank’s Solvency

JPMorgan cut its recommendation on the stock to "Underweight" from "Neutral" and withdrew its price target.

www.coindesk.com

A bipartisan grouping of three US Senators has written to Binance asking for details on its money laundering controls, accusing the crypto exchange of being a "hotbed of illegal financial activity," according to the Wall Street Journal.
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The exchange is reportedly bracing itself for significant fines for past conduct. A Binance spokesperson did not immediately respond to CoinDesk's request for comment.

Binance a 'Hotbed of Illegal Financial Activity,' Senators Claim: WSJ

A bipartisan grouping of three Senators has pressed the crypto exchange on allegations it sought to limit compliance.

www.coindesk.com

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Robinhood has just disclosed in a regulatory filing on Feb. 27 that it had been subpoenaed by the regulator regarding its crypto activities.

"In December 2022, shortly after FTX filed for bankruptcy on November 11, 2022, and following the bankruptcies of several other major cryptocurrency trading venues and lending platforms earlier in 2022, including Three Arrows Capital, Ltd., Voyager Digital Holdings, Inc., and Celsius Network LLC (“Celsius”) (collectively, the “2022 Crypto Bankruptcies”), we received an investigative subpoena from the SEC regarding, among other topics, RHC’s cryptocurrency listings, custody of cryptocurrencies, and platform operations," the company said.

Robinhood Might Stop Offering Crypto Services

As a result, the brokerage firm warned that if the SEC or a court concludes that cryptocurrencies or certain cryptocurrencies are "securities," the platform would simply "ceasing support for such cryptocurrencies on our platform."
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Robinhood Targeted in Regulator Crypto Crackdown

 

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Crypto exchange Coinbase stops initiating payments to or from Silvergate

Cryptocurrency exchange Coinbase Global Inc said on Thursday it was no longer accepting or initiating payments to or from Silvergate Capital Corp after the lender warned it was evaluating its ability to operate as a going concern.

www.reuters.com

 

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The wild west is getting wilder.

 

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Major digital assets plunged as the business day began in Hong Kong on Friday.

Bitcoin (BTC) and ether (ETH) both dropped more than 5% as customers fled crypto bank Silvergate, whose stock tumbled 58% during U.S. trading Thursday. Most of the other 10 largest cryptocurrencies by market cap saw declines similar to BTC and ETH's.
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Bitcoin, Ether Drop Over 5% in Massive Sell-Off as Market Continues to Digest Silvergate

Bitcoin plunged to $22,277 and Ether hit $1,563 as crypto tumbled during the opening hours of East Asia's trading day.

www.coindesk.com

 

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Etherium Shanghai update pushed to mid April:

Ethereum Shanghai hard fork pushed to mid-April

Ethereum’s highly-anticipated Shanghai hard fork, which is designed to enable the withdrawal of staked Ether, has been pushed back and will now take place in mid-April.

www.kitco.com

 

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Silvergate is going poof.

Silvergate shutting down operations and liquidating bank

Silvergate Capital announced on Wednesday that it will wind down operations and liquidate Silvergate Bank.

www.cnbc.com

 

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29 arrested after thousands swept up in cryptocurrency investment scam​

Story by Ahmed Shawkat • Yesterday 2:02 PM

Cairo — Egyptians who invested in a cryptocurrency mining app were hit last week with the daunting realization that the incredible profits they thought they were making all boiled down to fiction. The platform, called Hoggpool, was launched in August.

In a promotional video, a man introduced the company with a claim that it was founded in Colorado in

2019 and was investing in cutting-edge industries, from "life sciences technology" to "space tech and blockchain." He called it "one of the leading energy providers worldwide" and said it offered "cryptocurrency mining at all levels."

More:

29 arrested after thousands swept up in cryptocurrency investment scam

 

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Worldwide crypto & NFT rug pulls and scams tracker​

Worldwide crypto & NFT rug pulls and scams tracker - Comparitech

The crypto world is reported to be worth over $3 trillion with over 300 million people worldwide owning some form of crypto. But as our cryptocurrency and NFT heist trackers have found, crypto is a lucrative business for hackers. These trackers don’t account for insider jobs and scams (e.g...

www.comparitech.com

 

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In its March attestation, Circle had revealed that part of its $9.88 billion in cash reserves was held at SVB, although it did not disclose the total amount. Following the collapse of SVB, withdrawals from USDC mounted, with the crypto intelligence platform Nansen showing over $1 billion in redemptions from the stablecoin since SVB’s shutdown. USDC has a market cap just north of $40 billion.

As USDC lost its $1 peg across different crypto exchanges amid withdrawals, Circle sought to instill confidence, with the company tweeting at 6:50 pm ET that it would continue to operate normally, sharing that SVB was one of the six banking partners it uses for the 25% of its reserves that it keeps in cash, although still not disclosing the amount held at SVB.

Circle reveals it has $3.3 billion stuck at Silicon Valley Bank as USDC wobbles against its peg

The company insisted that it was protecting the stablecoin from a "black swan failure."

fortune.com

 

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Amid the worst banking crisis since 2008, four Republicans in the U.S. Senate, led by Senator Bill Hagerty (R-TN), have written a letter to the heads of several federal banking regulatory agencies asking them to explain the coordinated effort to crack down on crypto-related banking providers in recent months.

The letter was addressed to Federal Reserve Chair Jerome Powell, Federal Deposit Insurance Corporation (FDIC) Chair Marty Gruenberg, and Office of the Comptroller of the Currency (OCC) Chair Michael Hsu, seeking further insights into recent statements made by the banking regulators that have called for heightened supervision of crypto-related activities.

“These releases have caused banks to reevaluate their decision to provide banking services to the crypto sector, resulting in crypto firms’ bank accounts being unexpectedly closed,” the Senators wrote. “This coordinated behavior seems disturbingly reminiscent of Operation Choke Point… an Obama Administration initiative where federal regulators applied pressure on financial institutions to cut off financial services to certain licensed, legally operating industries simply because certain regulators and policymakers disfavored those industries.”

The result of an investigation into Operation Choke Point found that businesses were illegally targeted by government officials, and the FDIC was forced to take steps to clarify that banks are allowed to provide services to legal businesses and provide enhanced training to its examiners.

“Unfortunately, nearly four years after the enhanced training, banking regulators seem to be reverting to old practices,” the letter said. “Even if the actions towards the crypto economy emanate from different regulatory concerns – it appears that the desired outcome from the banking regulators is similar to that of Operation Choke Point – the de-banking of the crypto industry in America.”
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Senators say regulators are 'de-banking' the crypto sector in America

A group of four U.S. Senators has issued a letter to banking regulators seeking an explanation for the coordinated effort to crack down on crypto-related banking providers.

www.kitco.com

Letter:

https://www.hagerty.senate.gov/wp-content/uploads/2023/03/Hagerty-Chokepoint-Letter-FINAL.pdf

 

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• Bitcoin rose in a broad crypto rally Monday after US regulators bailed out customers of Silicon Valley Bank.
• The value of the total crypto market topped $1 trillion as fears around failed SVB and Signature Bank ebbed.
• Meanwhile, Circle said its $3.3 billion reserves in SVB would be available and its stablecoin would regain its peg.

Bitcoin rises and crypto market tops $1 trillion again after US regulators bail out SVB customers

 

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Regarding post #135 above (bold emphasis is mine):

On Friday, Signature Bank customers spooked by the sudden collapse of Silicon Valley Bank withdrew more than $10 billion in deposits, a board member told CNBC.

That run on deposits quickly led to the third-largest bank failure in U.S. history. Regulators announced late Sunday that Signature was being taken over to protect its depositors and the stability of the U.S. financial system.

The sudden move shocked executives of Signature Bank, a New York-based institution with deep ties to the real estate and legal industries, said board member and former congressman Barney Frank. Signature had 40 branches, assets of $110.36 billion and deposits of $88.59 billion at the end of 2022, according to a regulatory filing.
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According to Frank, Signature executives explored "all avenues" to shore up its situation, including finding more capital and gauging interest from potential acquirers. The deposit exodus had slowed by Sunday, he said, and executives believed they had stabilized the situation.

Instead, Signature's top managers have been summarily removed and the bank was shuttered Sunday. Regulators are now conducting a sales process for the bank, while guaranteeing that customers will have access to deposits and service will continue uninterrupted.
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For his part, Barney, who helped draft the landmark Dodd-Frank Act after the 2008 financial crisis, said there was "no real objective reason" that Signature had to be seized.

"I think part of what happened was that regulators wanted to send a very strong anti-crypto message," Frank said. "We became the poster boy because there was no insolvency based on the fundamentals."

Why regulators seized Signature Bank in third-biggest bank failure in U.S. history

The swift move shocked executives of Signature Bank, said board member and former congressman Barney Frank.

www.cnbc.com

 

[spinalcracker]

looks like the strong anti-crypto message fell on deaf ears , at least for today

 

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The reaction to last week's sudden wave of banking collapses led to a surge of fear across the market, which pushed crypto investors to exit positions en masse in an attempt to avoid a third major contagion event in less than a year.
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As markets plunged into fear, traders used the opportunity to open short positions with the expectation that matters would continue to deteriorate over the weekend and into Monday as the banking contagion spread and investors exited the market.

Unfortunately for short sellers, the U.S. Federal Reserve stepped in and announced that it would be covering the deposits at both SIVB and Signature Bank, which led to a resurgence in crypto prices.

As a result of the turnaround, data provided by Coinglass shows that more than $311 million worth of short positions were liquidated across all crypto markets on Saturday and Sunday.

The liquidations continued Monday, with the latest Coinglass data indicating that a total of 89,121 traders have had their positions liquidated in the past 24 hours, with the amount liquidated totaling $367.28 million.

Shorts decimated, crypto funds see record outflows amid banking concerns

Digital asset funds experienced record outflows last week in the wake of widespread banking concerns while the turnaround in the market decimated short sellers.

www.kitco.com

 

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An international law enforcement operation has taken down ChipMixer, a dark web “mixer” that helped criminals launder over $700 million, Europol and other policing agencies announced on Wednesday. Amongst its users were North Korean hackers and Russian spies, according to the Department of Justice.

Crypto ‘Mixer’ Laundered $700 Million For Customers, Including Russian And North Korean Spies, DOJ Says

 

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From the link:

According to the FBI's recently released annual internet crime report, $10.6 billion was lost due to online scams and frauds in 2022. This is up 46 percent from the $6.9 billion in losses in 2021. Furthermore, even though losses are way up, the number of complaints from scam victims made to the FBI's Internet Crime Complaint Center (IC3) were actually down from the previous year.

Online crypto scammers stole more than $10 billion in 2022

 

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On Tuesday, Tom Emmer, Majority Whip of the U.S. House of Representatives, sent a letter to Federal Deposit Insurance Corporation (FDIC) chair Martin Gruenberg, calling on the FDIC head to answer the question as to whether the agency has specifically instructed banks not to provide services to crypto firms.

“Recent reports indicate that Federal financial regulators have effectively weaponized their authorities over the last several months to purge legal digital asset entities and opportunities from the United States,” Emmer wrote.

The representative cited the recent comments from former House Financial Services Committee chair Barney Frank, co-author of the Dodd-Frank Act, who said during an interview on Monday that the targeted nature of these regulatory efforts is meant to send the message that crypto is toxic and should be avoided.

“If this is the case, these actions to weaponize recent instability in the banking sector, catalyzed by catastrophic government spending and unprecedented interest rate hikes, are deeply inappropriate and could lead to broader financial instability,” Emmer wrote.

Emmer’s letter mentioned the joint statement released by the Fed, FDIC and the Office of the Comptroller of the Currency in January that discouraged banks from holding crypto or serving crypto clients, the Feds public statement issued in February that “seemingly turned this perspective into a final” without a public comment period and the Biden Administration’s “Roadmap to Mitigate Cryptocurrenices’s Risks” as further evidence of a coordinated effort to malign the industry.

“In under a week, regulatory statement-driven market fear drove mass withdrawals at the few remaining banks that provide legal crypto firms access to financial services,” Emmer said. “The Administration’s demonstrated effort to choke off digital assets from the United States financial system is a lazy and destructive regulatory strategy that is stagnating innovation and subjecting American users of digital assets to less sophisticated regulatory jurisdictions.”

Emmer added that while Congress is focused on working across the aisle to develop nonpartisan legislative solutions for the crypto community, “Reports indicate that this Administration may be driven by a political agenda that has already harmed everyday Americans.”

The Congressman has called on the FDIC to officially answer whether it has instructed banks under its supervision to not provide crypto firms banking services, and if so, to explain the analysis for this instruction and “the goal of the instruction if not to discourage banks from servicing digital asset clients.”

Emmer also wants the FDIC to indicate whether it has explicitly or implicitly communicated with any banks that “their supervision will be more onerous in any way if they take on new (or maintain existing) digital asset clients.”
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Emmer is calling on Gruenberg and the FDIC to answer these questions no later than 5:00 p.m. on March 24.
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Rep. Emmer accuses the U.S. government of colluding to cut off crypto from the banking industry

U.S. House Rep. Tom Emmer has sent a letter to the FDIC probing allegations that the U.S. government is colluding to cut crypto off from the banking industry.

www.kitco.com

 

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Context for Rep. Emmer's letter mentioned in my last post:

Signature Bank is on the market after being shuttered by state regulators on Sunday, but any potential buyer reportedly has to agree to a major caveat: no crypto.

Reuters first reported the development on Wednesday evening, citing sources familiar with the matter.

The New York-based bank’s weekend closure came two days after the collapse of another bank, the California-based Silicon Valley Bank (SVB), and less than a week after the closure of another California-based bank, Silvergate Bank. All three of the now-defunct banks were known as being crypto-friendly financial institutions.

Signature Bank, whose crypto clients accounted for a quarter of its deposits, was reportedly under investigation by the Department of Justice (DOJ) and the U.S. Securities and Exchange Commission (SEC) for potentially lax monitoring that may have enabled money laundering.
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Signature Bank’s Prospective Buyers Must Agree to Give Up All Crypto Business: Report

The Federal Deposit Insurance Corporation (FDIC) has reportedly asked banks interested in acquiring the shuttered New York institution to submit bids by Friday.

www.coindesk.com

 

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Shanghai update to the Etherium network scheduled for April 12 now.

Ether withdrawals to begin on April 12 as SEC Chair Gensler restates that ETH is a security

The Shapella hard fork, which will enable staking withdrawals, is set to be integrated into the Ethereum mainnet on April 12.

www.kitco.com

 

[spinalcracker]

Bitcoin rises 9.2% to $27,359 — Reuters

Bitcoin surged 9.2% to $27,359 at 2207 GMT on Friday, adding $2,309 to its previous close.

stocks.apple.com

 

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Microsoft is testing a built-in cryptocurrency wallet for the Edge browser​

3/17/2023, 4:14 PM

Microsoft appears to be testing a built-in cryptocurrency wallet for Edge, according to screenshots pulled from a beta build of the browser. The feature, which the screenshots say is strictly for internal testing, was unearthed by Twitter user @thebookisclosed, who has a history of digging up present-but-disabled features in everything from new Windows 11 builds to ancient Windows Vista betas.

Full:

Microsoft is testing a built-in cryptocurrency wallet for the Edge browser

Crypto wallet would join coupons, cash back, and "buy now, pay later" add-ons.

arstechnica.com

 

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I wouldn't trust it. Browsers seem to be easily compromised by malware.

 

[spinalcracker]

not a bad month for BitCoin

up about 35%

how high will BC go by Dec 2023 is anyone’s guess eh

 

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Bold emphasis is mine:

WASHINGTON – The Federal Deposit Insurance Corporation (FDIC) entered into a purchase and assumption agreement for substantially all deposits and certain loan portfolios of Signature Bridge Bank, National Association, by Flagstar Bank, National Association, Hicksville, New York, a wholly owned subsidiary of New York Community Bancorp, Inc., Westbury, New York.

The 40 former branches of Signature Bank will operate under New York Community Bancorp's Flagstar Bank, N.A., on Monday, March 20, 2023. The branches will open during their normal business hours. Customers of Signature Bridge Bank, N.A., should continue to use their current branch until they receive notice from the assuming institution that full-service banking is available at branches of Flagstar Bank, N.A.

Depositors of Signature Bridge Bank, N.A., other than depositors related to the digital banking business, will automatically become depositors of the assuming institution. All deposits assumed by Flagstar Bank, N.A., will continue to be insured by the FDIC up to the insurance limit. Flagstar Bank's bid did not include approximately $4 billion of deposits related to the former Signature Bank's digital banking business. The FDIC will provide these deposits directly to customers whose accounts are associated with the digital banking business. Questions may be directed to (866) 744-5463.
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Subsidiary of New York Community Bancorp, Inc., to Assume Deposits of Signature Bridge Bank, N.A., From the FDIC

Subsidiary of New York Community Bancorp, Inc., to Assume Deposits of Signature Bridge Bank, N.A., From the FDIC

www.fdic.gov

FDIC has split off and debanked Signature's crypto clients. Operation Choke Point is in full effect.

 

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Operation Choke Point making it's way to the UK:

U.K. banks should be given a “whitelist” of registered crypto firms to avoid the sector being cut off from the financial system, lobby group CryptoUK has said in letters sent to regulators Tuesday.

Concerns over legitimate crypto companies getting debanked have spread to the U.K., where major lenders say they discourage access to riskier financial products for their customers’ own good.
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UK Crypto ‘Whitelist’ Needed to Solve Debanking, Lobby Group Says

British banks have said they keep customers away from crypto for their own protection.

www.coindesk.com

 

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A combination of bugs and human error has resulted in the loss of more than $1.15 billion worth of Ethereum (CRYPTO: ETH), according to research conducted by Conor Grogan, who is the director of product strategy and business operations at Coinbase Global Inc. (NASDAQ: COIN).

The Dark Side Of Crypto: Over 600,000 ETH Worth $1.15B Vanishes Into Thin Air

 

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... and people have collectively sent 24k Ethereum to a burn address for some unknown reason. ...

lulz

 

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SEC vs. Ripple verdict could come at pivotal time for crypto industry

 

[spinalcracker]

anyone care to guess on how the Fed decision today will affect Bitcoin , up or down?

 

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anyone care to guess on how the Fed decision today will affect Bitcoin , up or down?

I'm guessing sideways as American crypto industry is largely unbanked currently. I'm guessing most crypto trading right now is happening outside of USA borders and therefore less likely to be reactive on Fed interest rate news. But I could definitely be very wrong on this.

 

[spinalcracker]

I'm guessing sideways as American crypto industry is largely unbanked currently. I'm guessing most crypto trading right now is happening outside of USA borders and therefore less likely to be reactive on Fed interest rate news. But I could definitely be very wrong on this.

if this mornings movement , oh gawd that sounds awful , is any indication , up up and away

is it to early to say To the moon! ?

or ,

the train is leaving the station?

 

[pmbug]

Operation Choke Point 2.0 continues:

SEC Warns Coinbase It's Pursuing Enforcement Action Over Securities Violations

Coinbase says the SEC informed the company of plans to pursue an enforcement action against the exchange and its staking services, but few details were offered.

www.coindesk.com

 

[spinalcracker]

any chance of a Bitcoin ticker at the Top of the Page with the gold and silver?

 

[spinalcracker]

Operation Choke Point 2.0 continues:

SEC Warns Coinbase It's Pursuing Enforcement Action Over Securities Violations

Coinbase says the SEC informed the company of plans to pursue an enforcement action against the exchange and its staking services, but few details were offered.

www.coindesk.com

i do not completely understand staking

but i did opt in for it the other day as Coinbase gave all their customers the option…

based upon my history of returns , i opted in lol

 

[pmbug]

any chance of a Bitcoin ticker at the Top of the Page with the gold and silver?

I would need to find one that has similar dimensions to the existing charts. We do have finviz charts for BTC and ETH at the side or bottom of the page depending upon whether you are browsing with a computer or phone.