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Fire in the Hole 🧨
The crypto market is teetering on the verge of crashing under $1 trillion following last week’s $200 billion sell-off and a gradual decline over the weekend. Traders are now braced for a highly-anticipated speech by Federal Reserve chair Jerome Powell at the Jackson Hole central banking conference in Wyoming on Friday where he’s expected to talk about the economic outlook and potentially shed light on how he will attempt to cool the economy without freezing it over. Read the full story on Forbes.
The bitcoin price has dropped, dragging down the ethereum price while EOS has climbed.
The bitcoin price has slipped a further 1% over the last 24 hours, taking its weekly losses to almost 13%. Ether
One bright spark in a dim market this morning is one-time ethereum rival EOS
Now read this: How the bitcoin boom led to ‘a giant fleecing of ordinary people’
Explosive growth 💥
FTX, founded in 2019, has grown quickly to become one of the world’s largest crypto exchanges.
A million dollars isn’t cool… Crypto exchange FTX, led by crypto’s version of financier J. Pierpont Morgan, Sam Bankman-Fried (SBF), raked in more than $1 billion in revenue in 2021—up a blistering 1,000% from the year before, according to leaked documents seen by CNBC.
By the numbers: FTX revenue surged from $89 million to $1.02 billion in 2021, a ten-fold increase. Operating income rocketed to $272 million, up from $14 million in 2020, while net income soared to $388 million last year, up from just $17 million.
But but but… FTX’s yearly revenue remains a far cry from market leader Coinbase, which brought in revenue of $7.4 billion and net income of $3.6 billion last year.
On the up: During the first quarter of 2022, FTX brought in $270 million in revenue and is on track to top last year’s revenue in 2022, according to an investor deck shared with CNBC. Though this calculation was done before the crypto market tanked and lost around $2 trillion of value, so take it with a big pinch of salt.
Home run: SBF confirmed the numbers via Twitter, replying to the CNBC post that: “[For what it’s worth], numbers here are correct ballpark.”
A happy coincidence: It’s been pointed out that the CNBC reporter who got hold of the investor deck, Kate Rooney, was “in the Bahamas” to interview SBF last week, where FTX is headquartered and Bankman-Fried lives. “I wonder who would leak such a winning report,” asked Coindesk reporter Danny Nelson on Twitter.
Public negotiation: The leaked documents come just a month after Bloomberg reported FTX and FTX US are in talks to raise fresh capital following SBF’s recent spending spree. In January, FTX announced it raised $400 million at a $32 billion valuation, while FTX US raised a separate $400 million at an $8 billion valuation.
SBF wants you! Bankman-Fried has used the latest crypto winter to shore up his crypto empire, buying crypto trader Bitvo and the clearing company Embed. In July, FTX US struck a deal with crypto lender BlockFi that gives FTX an option to buy the struggling company and was in talks to buy South Korean crypto exchange Bithumb. SBF also tried to bail out Voyager Digital and reports have emerged that he has invested anonymously in other companies. Bankman-Fried has taken a 7.6% passive stake in trading app Robinhood but denied a takeover attempt is in the works.
Dear Sam: Last week, the Federal Deposit Insurance Corporation (FDIC) issued warnings to five companies, including FTX’s U.S. arm, to stop making false and misleading statements about FDIC deposit insurance, writing them cease-and-desist letters. Blockworks has more.
Good to know: Banks and the crypto lobby are clashing with lawmakers over a Fed digital dollar
$1.2 trillion oil fund under attack 🪖
🛢️ Norway’s $1.2 trillion oil fund, the world’s largest sovereign wealth fund, has said it’s more concerned about cyber attacks than market volatility, with crypto-enabled ransomware attacks up almost 250% against financial targets during the first six months of 2022.
🗣️ “We’re seeing many more attempts, more attacks [that are] increasingly sophisticated,” Norges Bank Investment Management chief executive Nicolai Tangen told the Financial Times, adding: “When it comes to ransomware, about half of network intrusions are phishing attempts and the other half are remote access attacks using stolen credentials.”
📉 A report out last month found the overall number of ransomware attacks, which use malicious software to lock users out of their systems until they transfer bitcoin or some other cryptocurrency to the attacker, declined 23% from January to June as the crypto market crashed.
Now read this: Crypto is tumbling, but in Argentina it’s still a safer bet
The week ahead 📆
👀 Look out for these cryptocurrency and crypto-related events this week.
⛏ Bitcoin
– Ethereum Miners Will Have Few Good Options After The Merge
📢 On Thursday, the Jackson Hole Economic Symposium, an annual conference of central bankers, gets underway in Wyoming with Federal Reserve chair Jerome Powell taking center stage on Friday. He’s expected to give his view of the economy and shed light on how the Fed will proceed in the months ahead as officials attempt a tightrope walk between fighting inflation and causing a recession.
⚡ Also Thursday, Tesla’s
– Here’s what you should know about the 3-for-1 stock split approved by Tesla shareholders
Listen to this: Biden’s approach to crypto
