Reading time 4m50s
GM.
John J. Ray III, FTXās new CEO (whoās getting paid $1,200/hr for the job), apparently thinks FTX could actually get up and running again.
Either heās been reading SBFās Substack too much, or he knows something we donāt. How terrifying.
And fallen crypto lender Genesis has officially filed for Chapter 11 Bankruptcy ā the co-founders of Gemini, the Winklevoss twins, are ready to throw hands at Barry Silbert (Genesis CEO) and his company with a lawsuit.
Weāre gonna hit all the above and more today, but not before we do the final trivia question of the week!
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Youāve heard of Layer 1 and Layer 2 blockchains ā but what does a Layer 0 chain do?
Tap your answer below to see if youāre right!
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Today's Agenda:
Oh No. Theyāre Restarting FTX?! š±
Genesis Files for Bankruptcy š
NFT Sales Broke $101M Last Year š§Ø
JP Morgan CEO: āBTC Is a Pet Rockā š¤£
Nexo Capital Pays SEC $45M š§
Please, no. Anything but that š¤¢
Current FTX CEO John Ray has chillingly optimistic views about the future of the exchange. Namely, the fact that he thinks the exchange has a future at all.
Ray thinks that restarting the Exchange could be the best way to make users whole again and restore what was lost. Sam Bankman-Fried couldnāt agree more, which feels like a huge warning sign š
And yes, SBF is still on his āFTX US is solventā kick, āas he always has been.ā
The thought of FTX coming back just leaves an awful taste in my mouth. Forget about how the crypto industry would feel ā what would the outside world think of us?
If we reinstate an organization that destroyed peopleās lives with its corruption, no one will want to take crypto seriously. Or maybe Iām wrong? Let me know what you think on Twitter!
Okay, that one was good š
Also, in wild but related news, three men drove a car straight into the metal barricade outside SBFās parentsā house.
They told a security guard āYou wonāt be able to stop usā and then drove away. The guards werenāt able to get their license plate info.
Although I do want justice to be served to SBF and FTX, I donāt wish any physical harm to the man. This is alarming ā and it explains why his family is paying $10k a month for security š
Well, itās not surprising, but Barry Silbertās company has bitten the Chapter 11 bullet.
With liabilities somewhere between $1-10 BILLION, Genesis apparently hasnāt been able to fix its liquidity crisis and is now seeking the protection that bankruptcy would provide.
The company will now undergo a huge restructuring process led by an āindependent special committeeā that has the goal of ensuring "an optimal outcome for Genesis clients and Gemini Earn users."
For context, Genesis owes Gemini Earn users $900M, and hasnāt payed a cent of it yet. Geminiās co-founders, the Winklevoss twins, are happy to see this step forward.
However, the Winklevoss twins are 100% ready to sue Genesis if it keeps refusing to pay Earn users back:
Digital Currency Group (DCG) is Genesisās parent company.
Both sides are in hot water right now, though. Gemini itself is currently facing charges (along with Genesis) from the SEC for selling unregistered securities.
What happens next will depend on whether Genesisā restructuring is actually able to get the company standing once again and whether Gemini takes legal action against Genesis before that point. Weāll keep you updated.
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Other Top Stories Today š¢
With the overall market downturn, itās refreshing to see some positive statistics. NFT sales increased by 67% in 2022 to a whopping $101M. The industry saw a shift away from hype-driven NFT drops to utility-focused projects, which has felt much more sustainable to me. ETH still sits at the top of the NFT blockchain market share, but it only has 21% ā Polygon and Solana are closing in on it with more than half of ETHās market share each.
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Ok, this one actually gets me š¤£ Jamie Dimon, the CEO of finance giant JP Morgan, still hates Bitcoin. He literally called it a pet rock, implying that it does nothing and is meaningless.
This is the head of the company that has plans to build a crypto wallet and is already providing crypto payments and exchanges to customers, apparently hates Bitcoin. Iāll be honest ā this feels childish, and Iām wondering if Dimon just lost a lot of money on a max leverage BTC trade and is taking out his anger about it š
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Nexo has settled with the SEC outside of any court case, keeping completely silent about any of the investigations the North American Securities Administrators Association (NASAA) and the SEC have been conducting about its sale of securities through its Earn program over the past year. Gary Gensler, the Chairman of the SEC, said the following: āWe charged Nexo with failing to register its retail crypto lending product before offering it to the public, bypassing essential disclosure requirements designed to protect investors.ā The settlement is for $45M and will be paid out to at least 17 separate state securities regulators.
Web3 Resource of the Day
Understand Layer 0, 1 and 2 of Blockchain - Article from CryptoStarsWhy is Layer 0 so important if no transactions take place on it? Why do Layer 2s do things āoff-chainā?The terms Layer 0, 1, and 2 are thrown around constantly in the crypto space, and Iām convinced that at least half the people saying them donāt really understand what theyāre talking about. This article lays out a really solid foundation for what each layer of blockchain technology actually does, and itās all explained in context of the other layers too.
Happy Friday! Welcome to the Weekend
We DID IT! Another Friday, and another week of news in the Web3 space. We hope you feel informed and up to date.
The biggest story Iām anticipating for next week? The big reveal of Genesisā financial adviser. My money is definitely on Pepe, but weāll see.
Thatās all for today, frens!
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DISCLAIMER: This is not financial advice. This newsletter is strictly educational and is not investment advice to buy or sell any assets or to make any financial decisions. Do your own research.