SBF's day in court 🦹🏻
SBF testifies without a jury present. Monegro sees the FTX downfall as Solana's opportunity. Yuga Labs win big against satirical copycats. UK law lets police freeze suspicious crypto
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Manhattan's federal court played host to an unusual scene on Thursday when FTX founder, Sam Bankman-Fried, testified before US District Judge Lewis Kaplan—but sans the jury.
The reason for their absence? Judge Kaplan deemed it necessary to evaluate which portions of Bankman-Fried's testimony would be allowed when the jury returns.
Guided by lead attorney, Mark Cohen of Cohen & Gresser, Bankman-Fried delved into several discussions, including his interactions with Bahamian regulators and the legal advice he procured from FTX's legal team.
Under direct questioning, SBF eloquently detailed how all his actions at FTX had been under the legal guidance of the company's attorneys.
And for a minute, it seemed like having SBF testify was the defense's ace in the hole.
But then, the tables turned.
As Assistant US Attorney Danielle Sassoon began her cross-examination, SBF found himself on shakier ground.
Sassoon's probing queries pushed him to delve into specifics, leading to a few uncomfortable stumbles and longer-than-necessary responses.
Facing a staggering 110-year prison sentence over seven charges related to fraud and conspiracy, Bankman-Fried is accused of misappropriating a massive sum from FTX's clientele.
As the questioning intensified, his answers frequently converged on the phrase, "I don't recall."
This evasive pattern prompted Judge Kaplan to comment on Bankman-Fried's "interesting way of responding to questions."
The Deleted Messages
SBF found himself facing questions about his use of Signal, an encrypted messaging app, for corporate communications.
SBF's defense? He claimed the move to Signal was with the blessing of FTX counsel Daniel Friedberg. But, while Friedberg might have approved the app's use, the app's auto-delete feature was SBF's own play.
One week, and any digital trace of the messages vanish.
Quite the ephemeral strategy, isn't it?
Then came the zinger from Sassoon: "Did any lawyer tell you that you could delete your messages with Caroline Ellison, Gary Wang and Nishad Singh?"
The room could have frozen as SBF uttered, "Not specifically."
Further, SBF cited a 2021 document retention policy that seemingly exempted non-email communication, suggesting these transient messages were technically within policy bounds.
Yet, when probed about the alleged "fake" balance sheets and a whopping $13 billion gap in FTX's books, SBF hinted that some discussions never reached their lawyers to avoid potential misinterpretation or embarrassment.
Migration of Funds
At the heart of the drama?
The mysterious migration of FTX user funds from Alameda to the enigmatic North Dimension.
Rumors hint North Dimension is a backstage player in money laundering.
SBF, however, claimed cluelessness about this fund shuffle, suggesting banks might've preferred the elusive North Dimension over crypto-tied Alameda.
While he acknowledged North Dimension's role in this saga, he emphasised his limited involvement.
"I am not a lawyer... At FTX, customers believed accounts would be sent to Alameda."
But, here's the catch
The jury wasn't there for all this drama. Judge Lewis Kaplan, had decided to first assess the relevance of Bankman-Fried's testimony before letting the jury hear it.
The jury's chairs remained empty, making one wonder about the actual impact of this courtroom roller-coaster.
Until this point, the jury's only exposure to Bankman-Fried's statements had been through select video clips, including one of him discussing Alameda Research on a podcast and another featuring his congressional testimony on cryptocurrencies.
Friday beckons with anticipation.
Judge Kaplan will decide what parts of the testimony the jury will get to hear. There's speculation that the defense may recalibrate their strategy based on Thursday's events.
TTD Blockquote🎙️
Joel Monegro, co-founder of Placeholder.
FTX implosion was a ‘clear market opportunity’ for Solana.
Remember when everyone was giving Ethereum the cold shoulder in 2018 and 2019?
A moment of silence for the naysayers...
But Monegro, being the risk-taker he is, thought it was the perfect time to bet big on Ethereum.
And boy, did it pay off.
Fast forward to today, Ethereum’s chilling on its crypto throne, all thanks to bold moves like these.
The FTX-Solana Drama 🍿
So, while everyone was freaking out over the FTX saga, Monegro saw a familiar pattern with Solana.
Think of it as a déjà vu moment.
According to Monegro, Solana’s story felt eerily like an Ethereum rerun.
So, what did he do?
He dove right into the Solana pool, of course.
Sure, there were some initial reservations due to FTX flexing its muscles all over the Solana ecosystem.
With FTX out of the picture, Monegro felt like it was time for Solana to shine.
“We started slowly investing and then accelerated our pace post-FTX because in our minds, it took care of our biggest problem with the network.”
The Solana Advantage (or Why Ethereum Might Want to Watch Its Back)
Joel Monegro is all praises for Solana.
He feels the platform is kind of like the "cool kid" that sits between the traditional internet (Web2) and the decentralised one (Web3).
Plus, it offers the charm of being more user-friendly.
Who doesn’t love that?
And there's another juicy tidbit.
Solana deals are apparently more wallet-friendly than Ethereum deals.
The crypto space has evolved past its baby steps, and now it’s all about delivering value straight to the end user.
Monegro believes the future lies with platforms that understand this, and he's betting on Solana to lead the charge
Where’s ETF?🚨
Investors have been eagerly awaiting the launch of a Bitcoin ETF, and it seems that one may finally be on the horizon👇🏻
TTD Numbers 🔢
$1.5 Million
Ryder Ripps found himself with a not-so-small bill of $1.5 million after a US District Judge in California sided with Yuga Labs, creators of the Bored Ape Yacht Club NFTs.
Ripps and co-defendant, Jeremy Cahen, were sailing smoothly with their "satirical" version until Yuga Labs dropped the legal anchor.
Ripps and Cahen defended their actions, claiming their use of the BAYC trademarks was merely "satire" and "parody."
However, the court sided with Yuga Labs, ordering the defendants not only to pay damages but also to cease all sales and return related online assets.
Adding salt to the wound, the judge granted Yuga Labs an additional $200,000 for cybersquatting violations linked to domain names tied to the defendants.
These actions further underlined the court's stance that the defendants had a "bad faith intent to profit."
$6.5 Million
FTX is delving into the details of its hefty donations to the Center for AI Safety (CAIS), a nonprofit known for prioritising AI safety on par with threats like nuclear warfare.
Court filings on October 25 reveal FTX donated a whopping $6.5 million to CAIS in the mere months leading up to the exchange's financial downfall in November 2022.
The exchange is urging a Delaware Bankruptcy Court to greenlight subpoenas seeking clarity on whether CAIS entered any contracts, received payments, or had any significant communications with FTX and its former top brass.
FTX alleges that the AI nonprofit has been tight-lipped, rebuffing their calls for a voluntary breakdown of the funds.
This move by FTX to shine a light on its dealings with CAIS is thought to be part of a broader mission to gather funds for settling with its creditors and the numerous customers left in the lurch post-bankruptcy.
As of June, FTX claims to have clawed back around $7 billion but still finds itself $1.7 billion short.
TTD The UK 🇬🇧
In the latest chapter of the UK's crypto journey, there's a new rule in the playbook. With the stamp of approval from the King, law enforcement now has a swanky new tool in their belt.
The 'Economic Crime and Corporate Transparency Bill' is now law.
Its mission? Empower the local police to swiftly freeze any suspicious crypto assets - even without a court's say-so.
Backstory: This bill entered the scene last September, and it has seen some tweaks along the way. While its primary aim is to tackle the crypto bad guys, there's a broader scope now, encompassing issues like terrorism and tracing assets linked to crypto crimes.
Google's "Buy Bitcoin" Searches Skyrocket
As Bitcoin's price soars, so does public curiosity. Google has witnessed a sharp rise in searches related to buying Bitcoin, especially in the UK, where the query "buy Bitcoin" escalated by an astounding 826% in just a week, as per Cryptogambling.tv's research.
The surge isn't limited to the UK. Globally, there's been a remarkable uptick in Bitcoin-related searches.
In the US, people inquiring, "should I buy Bitcoin now?" shot up by over 250%. Even more specialised searches, such as “can I buy Bitcoin on Fidelity?” spiked, seeing a 3,100% rise in a week.
Further data reveals a 110% global increase in the query “Is it a good time to buy Bitcoin?” over the same period.
Additionally, a 250% surge was noted for "BlackRock Bitcoin ETF" searches, pointing to anticipation for BlackRock's potential Bitcoin ETF.
This heightened interest aligns with Bitcoin's price jump, touching $35,000 on October 24 for the first time since May 2022.
Analysts speculate that this momentum might be tied to the impending approval of a Bitcoin ETF, suggesting a potential institutional buying frenzy.
Bitcoin's recent performance shows a 27% gain over the last two weeks, indicating its growing attraction in the financial market.
TTD HTX 🧧
Justin Sun, the influential owner of crypto exchange HTX, states that the firm raked in a cool profit of $98 million in the third quarter of 2023.
$202 million in revenue minus $104 million in expenses.
And for those keeping score, he forecasts even brighter days ahead, anticipating profits to touch $104 million in Q4.
Industry Headwinds: Sun acknowledges that the third quarter was no cakewalk for the crypto industry, citing the US Federal Reserve's high-interest policy as a major speed bump causing widespread revenue dips.
However, ever the optimist, he commented …
“The overall market recovered in the fourth quarter. We are optimistic about the fourth quarter. The revenue forecast is still relatively conservative.”
He predicts that the bearish crypto market is wrapping up and expects a resurgence in both Q4 2023 and Q1 2024. His take? The crypto world is about to bask in a "spring recovery".
Behind the Curtains: Yet, it hasn't been all roses for HTX. Despite these optimistic projections, the company's inner workings hint at turbulence.
At a recent event, it came to light that HTX has scaled down its workforce considerably, dropping from 2,500 to a mere 900 this year.
The reason? Falling revenues earlier this year reportedly led to slashed salaries and bonus cuts, even causing an internal uproar among employees.
TTD Surfer🏄🏻
Pepecoin, a popular memecoin, has seen its market cap double to $500 million in just one week.
CryptoPunk NFT holders have the opportunity to obtain physical prints of their digital art items for a limited time.
Crypto recovery firm Unciphered is offering to crack former Ripple CTO Stefan Thomas' hard drive containing 7,002 Bitcoin, worth around $244 million.
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