• Bitcoin (BTC) is benefiting from instability in the financial system, falling inflation and regulatory overhang on stablecoins.
• Investors are shifting from higher beta or more volatile cryptocurrencies into BTC and from stablecoins to BTC.
• The Fed’s policy of raising rates has led to falling prices of Treasurys, lowering the value of USD and making BTC more attractive as an investment.

Bitcoin Benefits From Crypto’s Flight To Quality

Instability in the financial system is driving investors towards bitcoin, according to crypto-services provider Matrixport. Traders and investors have shifted away from both higher beta cryptocurrencies and stablecoins into bitcoin due to a variety of factors.

Surviving Falling Inflation

The Federal Reserve’s interest rate policy has severely damaged some investment portfolios and threatened the financial stability of the economy, leading many investors to flock towards bitcoin for safety. As long as these trends persist, bitcoin prices can stay high and continue rallying.

Stablecoin Regulatory Overhang

Regulatory scrutiny around Paxos Trust’s binance USD (BUSD) caused funds to move out of that currency into BTC, while Circle Internet Financial’s USD coin (USDC) lost its peg when money flowed out.

Falling Treasury Prices

The Fed’s policy of raising rates has led to falling prices in U.S. Treasuries which lowers the value of the U.S. dollar relative to other currencies – thereby making investments in other assets such as bitcoin more attractive.

Conclusion

The combination of these factors leads Matrixport researcher Markus Thielen to conclude that “investors have now woken up” regarding cryptocurrency investments – with bitcoin being one particular asset that benefits from this flight to quality.

• JPMorgan has reported that the termination of Silvergate Exchange Network (SEN) and the collapse of crypto bank Silvergate will cause a challenge for the crypto industry.
• Silvergate had provided services to more than 1000 institutional crypto market participants such as exchanges, miners, stablecoin issuers and fund managers.
• Replacing this instantaneous network for processing dollar deposits and withdrawals among crypto market participants will be difficult due to regulatory pressures, with some services migrating to other banks like Signature Bank.

Challenge for Crypto Industry

JPMorgan (JPM) said in a research report Thursday that the collapse of crypto bank Silvergate and the termination of the Silvergate Exchange Network (SEN) pose a challenge for the crypto industry. Silvergate had operated as a gateway for more than 1,000 “institutional crypto market participants including major crypto exchanges, miners, stablecoin issuers, market makers and digital asset fund managers that have been using its network to transfer fiat currency between their Silvergate accounts and the accounts of other Silvergate customers,” analysts led by Nikolaos Panigirtzoglou wrote.

Replacement Difficulty

Replacing this instantaneous network for processing dollar deposits and withdrawals among crypto market participants will be challenging given the current backdrop and the “general unwillingness of traditional banks to engage with crypto companies following the FTX collapse and given high regulatory pressures,” JPMorgan said. The entry of new depository institutions seems unlikely at present due to heightened regulatory scrutiny of cryptocurrency operations.

Services Migration

Some of the services provided by Silvergate will migrate to other banks such as Signature Bank, Provident Bancorp, Metropolitan Commercial Bank and Customers Bancorp, according to JPMorgan’s analysis. Some customers who left Silvergate have already announced they are migrating to Signature Bank; however its capacity to replace Silvergate would likely be limited due to market and regulatory pressure to reduce risks associated with cryptocurrencies.

FTX Collapse

JPMorgan also noted that general unwillingness from traditional banks towards engaging with crypto companies follows after FTX’s collapse which might have lead them into being cautious about taking up any risks associated with cryptocurrencies in order not face any losses or legal implications later on down line.

Heightened Regulatory Scrutiny

The heightened regulatory scrutiny on cryptocurrency operations is making it difficult for new depository institutions from entering in this space causing further difficulty when replacing an already existing platform like SEN which was providing services all across different sectors in relation with cryptocurrency operations.

• Silvergate Bank’s share price has plummeted over 50% after its crypto industry clients announced they would suspend business with the bank.
• The bank said it needed to answer requests from independent auditors and regulatory agencies, and it was facing potential inquiries from the US Department of Justice.
• Coinbase, Circle, Paxos, Crypto.com, Bitstamp, Cboe Digital Markets, Galaxy Digital and Gemini have all suspended their operations with Silvergate Bank.

Silvergate Stock Drops Over 50%

Silvergate Bank (SI)’s stock price has taken a beating on news that its cryptocurrency industry clients are suspending operations with the bank. The bank had previously warned of several headwinds they were facing including possible inquiries from regulators and the US Department of Justice as well as an audit request by its independent auditors.

Crypto Clients Fleeing Beleaguered Bank

Coinbase, Circle, Paxos, Crypto.com, Bitstamp, Cboe Digital Markets, Galaxy Digital and Gemini have all announced that they will no longer be doing business with Silvergate Bank due to these uncertainties surrounding the financial institution. Kraken is currently the only major crypto exchange continuing to use Silvergate after ending some transactions with rival Signature Bank (SBNY).

Review of Books With Auditors

Silvergate has been forced to delay filing its annual 10-K filing while they review their books with their auditors and answer any inquiries or investigations that may arise in connection with this review process. The bank also warned investors in a forward-looking statement that their ability to continue as a going concern over the next year may be affected by these events.

Repayment of Federal Home Loan Bank Loans

The bank further revealed that they may need to repay loans taken out last year from Federal Home Loan Banks which could put additional strain on their finances. As a result of this news and its impact on investment confidence in the company’s future prospects fo success; shares in Silvergate dropped more than 50% to an all-time low on Wednesday’s trading session.

Kraken Remains Loyal To Silvergate

Kraken remains loyal to Silvergate by continuing do business through them despite other companies leaving for greener pastures elsewhere; however no comment was given when asked about this situation specifically .

• Platypus Finance, a DeFi protocol for stablecoins, was hacked last week and lost $9 million.
• The protocol worked with crypto exchange Binance to identify the hacker responsible for the attack.
• Platypus has managed to recover at least 63% of funds and is working with law enforcement and Aave’s governance forum to release other assets.

Platypus Finance Hack

Platypus Finance, a decentralized finance (DeFi) protocol for stablecoins, suffered a hack last week in which $9 million was stolen from the platform. The Avalanche-based protocol has since worked with crypto exchange Binance to identify the exploiter responsible for the attack and has managed to recover at least 63% of user funds.

Exploit Details

The exploit consisted of three consecutive attacks. The first attack drained $8.5 million worth of digital assets from the main pool, including Circle’s USDC, Tether’s USDT, Maker’s DAI and Paxos’ binance USD. The second attack mistakenly transferred $380,000 of stablecoins to lending protocol Aave. The hacker used a Binance account that went through know-your-customer checks for a withdrawal request.

Recover Funds

Platypus Finance recovered $2.4 million of stolen USDC stablecoins with the help of blockchain security firm BlockSec while Tether froze $1.5 million of stolen USDT as well as filed a complaint in France and contacted law enforcement agencies about the incident. Additionally, Platypus submitted a proposal to Aave’s governance forum for releasing those assets worth around $287,000 back into its platform safely without any losses incurred by users affected by this attack..

Repayment Plan

Platypus Finance said it will repay a minimum of 63% of funds to users after recovering part of them back from their attacker successfully under its repayment plan In order ensure greater security going forward, it also implemented new measures such as additional solvency checks on all pools along with various bug fixes in its system protocols .

Conclusion

Overall despite this unfortunate event causing some financial loss on both sides; Platypus Finance is taking active steps towards restoring user trust in its system by recovering most funds back from attackers & implementing various precautionary measures that should make DeFi protocols more secure against similar attacks in future

• TrueFi’s TRU token rallied over 200% after Binance’s TUSD mint sparked speculation.
• The speculation appears to be connected to TUSD, a stablecoin previously issued by TrueFI but no longer is.
• The rally was likely caused by traders mistakenly connecting the two tokens.

TrueFi’s TRU Token Rallies Over 200%

The rally appears to come from traders mistakenly connecting TRU with TUSD, a stablecoin that had been issued by TrueFi in the past but now no longer is. By Krisztian Sandor Feb 16, 2023 at 6:03 p.m. UTC Updated Feb 16, 2023 at 7:24 p.m. UTC

Background of the Rally

TRU, the governance token of decentralized lending protocol TrueFi, surged 220% on Thursday in an hour, data by CoinMarketCap shows, in a speculative flurry over a Binance stablecoin transaction. Before the rally took off, Binance, the world’s largest crypto exchange by volume, minted $50 million of TrueUSD (TUSD) stablecoin, according to blockchain data. The event sparked speculation among crypto traders about TUSD potentially gaining a larger role in trading on Binance after the regulatory crackdown on the Paxos-issued Binance USD (BUSD).

Mistaken Connection between Tokens

However, the speculation about the TRU token appears to be misplaced because the issuers of the TrueUSD and TRU tokens were separated a while ago. TrustToken sold TUSD in 2020 to a firm called Techteryx, according to an announcement by TrustToken Chief Executive Rafael Cosman at the time. The post said Techteryx is an “Asia-based conglomerate with businesses … in the traditional real estate, entertainment, environmental and information technology industries.” TrustToken also separated from the TrueFi protocol and was renamed Archblock last year as TrueFi embarked on its road to decentralize its platform.

TRU Price Movement

TRU surged as high as 14

• The SEC is meeting in a closed-door session on Thursday to settle charges with Kraken over offering unregistered securities.
• Kraken will immediately end its crypto staking-as-a-service platform for U.S. customers and pay $30 million in order to settle the SEC charges.
• The SEC has confirmed that Kraken’s staking services for U.S. customers will be shut down under the settlement agreement.

Kraken Agrees to Shutter US Crypto-Staking Operations

The U.S Securities and Exchange Commission (SEC) has voted on a settlement with cryptocurrency exchange Kraken where it agreed to immediately end its crypto staking-as-a-service platform for U.S customers and pay $30 million in order to settle the SEC charges of offering unregistered securities.

SEC Charges Over Unregistered Securities

Kraken offered its staking services with an APY of up to 20%, promising to send customers staking rewards twice per week, as stated on their website. It also offered a crypto lending product which provided up to 24% yield but both these services are expected to shut down under the said settlement agreement with the SEC.

Closed Door Session

The SEC held a closed door commissioner meeting on Thursday afternoon regarding settling charges against Kraken, and an announcement may come later in the day after the publication of this article, according to an industry person briefed on the matter.

Implications For Cryptocurrency Regulations

CoinDesk Global Policy and Regulation Managing Editor Nikhilesh De discussed how this case could have implications for wider cryptocurrency regulations across different countries, such as requirements for KYC/AML processes or even laws governing certain types of activities related to digital assets or tokens that can be classified as securities or financial instruments in some jurisdictions around the world.

Conclusion
The resolution between Kraken and SEC is seen as another milestone towards establishing clearer regulations surrounding cryptocurrency companies operating within US jurisdiction by providing greater legal certainty regarding activities related to digital assets or tokens that can be classified as securities or financial instruments in some jurisdictions around the world

• Bittrex, a Seattle-based cryptocurrency exchange, is cutting its staff by more than 80 people due to market conditions.
• CEO Richie Lai cited the “new economic environment” as the primary reason for the cuts.
• This follows other crypto exchanges such as Coinbase and Gemini who have also had to make layoffs in light of recent market downturns.

Bittrex Laying Off More Than 80 People

Seattle-based cryptocurrency exchange Bittrex is reducing its staff by more than 80 people, the company confirmed Thursday, citing market conditions. In a leaked email on Twitter, Bittrex CEO Richie Lai told employees the team had been working “aggressively” to reduce expenses and increase efficiencies, but were not successful. The reductions affected at least some employees in most departments across Bittrex, a spokesperson told CoinDesk.

Reason Behind Layoffs

CEO Richie Lai cited the “new economic environment” as the primary reason for the cuts. He wrote that “the market downturn triggered by multiple failures in the crypto ecosystem became an outright collapse by the end of the year,” which prompted them to reset their strategy and balance their investments with this new reality.

Other Crypto Exchanges Make Layoffs

Bittrex is one of many crypto exchanges that announced layoffs in light of sharp declines in cryptocurrency prices and other prominent crypto firms collapsing. In January, U.S.-based exchange Gemini announced a third round of layoffs, while Coinbase said it would cut 20% of its workforce. According to CoinDesk estimates since April more than 29,000 jobs have been lost across the crypto industry based on media reports and press releases.

Job Losses Since April

CoinDesk estimates that since April more than 29,000 jobs have been lost across the crypto industry based on media reports and press releases.

Conclusion

The ongoing pandemic has had significant impacts on various industries all around world – including cryptocurrencies – causing numerous companies to resort to layoffs as they face unprecedented times ahead and recalibrate their strategies accordingly

• Rep. French Hill (R-Ark) announced that the newly formed U.S. House of Representatives subcommittee on digital assets, financial technology and inclusion will prioritize stablecoin legislation.
• Hill noted that the committee will also pursue a privacy statute federally, which is important to ensure that consumers and businesses can exchange digital assets with confidence.
• He also said that the committee plans to use its stablecoin draft as a model for how it will approach digital asset regulation moving forward.

The U.S. House of Representatives recently established a new subcommittee on digital assets, financial technology and inclusion, under the chairmanship of Rep. French Hill (R-Ark). On Thursday, Hill revealed the priorities of the subcommittee and highlighted the importance of stablecoin legislation in the United States.

Hill noted that stablecoins are a type of digital asset that have the potential to revolutionize the global economy, as they can be used to facilitate transactions quickly and securely. He went on to say that the subcommittee will use its stablecoin draft as a model for how it will approach digital asset regulation moving forward.

In addition to stablecoin legislation, Hill said that the committee will also pursue a privacy statute federally, which is important to ensure that consumers and businesses can exchange digital assets with confidence. He added that the subcommittee will also address the issue of which regulatory body, the SEC or the CFTC, will have explicit oversight on digital assets.

Hill concluded by emphasizing that the subcommittee’s goal is to ensure a secure, transparent and efficient digital asset industry in the United States. He said that the subcommittee will work with the industry to provide clarity on the regulatory framework and develop policies that protect both consumers and businesses.

Overall, Hill’s comments provide a good insight into the priorities of the subcommittee and show that the U.S. government is taking the digital asset industry seriously. It remains to be seen what the subcommittee will achieve in the coming months, but it is clear that the future of digital assets in the United States looks brighter than ever.

• Timothy Stranex, co-founder and chief technology officer (CTO) of cryptocurrency exchange Luno, departed in December 2020.
• Stranex was replaced as CTO by Simon Ince, who joined Luno as its vice president of engineering nearly two years ago.
• Luno’s parent company is Digital Currency Group and it has over 10 million customers worldwide.

Cryptocurrency exchange Luno recently made a major change to its executive team with the departure of its co-founder and chief technology officer (CTO), Timothy Stranex. Stranex had served as Luno’s CTO for nearly 10 years after founding the company with Carel van Wyk, Pieter Heyns and current CEO Marcus Swanepoel. His departure in December 2020 was to “pursue personal projects”.

To fill the void left by Stranex, Luno hired Simon Ince as its new CTO. Ince joined the company nearly two years ago as its vice president of engineering. With Ince at the helm, Luno is confident in its ability to continue developing its products and services to meet the needs of its customers.

Luno is owned by Digital Currency Group (also the parent company of CoinDesk). It has offices in London, Singapore, Cape Town, Johannesburg, Lagos, and Sydney, and has over 10 million customers worldwide.

In the wake of Stranex’s departure, Luno CEO Marcus Swanepoel expressed his appreciation for the co-founder’s hard work and dedication to the growth of the company during his tenure. Swanepoel also expressed his confidence in Ince, stating that he is the perfect fit to lead Luno’s technology into the future.

With its new CTO in place, Luno is poised to continue its mission to democratize access to digital assets and make cryptocurrency accessible to all. The exchange is committed to innovating and creating products and services tailored to its customers, while also ensuring its platform is secure and compliant with regulations.

• Ethereum’s Beacon Chain staking contract has surpassed 16 million ETH, or 13.28% of the total ether supply, worth $22.38 billion.
• This milestone follows Ethereum’s successful shift to a proof-of-stake network in December 2020.
• Ethereum developers have determined that the network’s next hard fork “Shanghai” will have a target release time frame of March 2023, which will enable Beacon Chain staked ether withdrawals.

Ethereum has achieved a major milestone after its successful shift to a proof-of-stake network in December 2020. More than 16 million ether (ETH) has been deposited into Ethereum’s Beacon Chain staking contract, data from Etherscan shows. This means that more than 13.28% of the total ether supply, worth $22.38 billion, has been staked on the network.

The Ethereum staking contract went live in 2020 and since then, the Ethereum network has seen a steady increase in staked ether. This milestone occurs as Ethereum developers determine that the network’s next hard fork “Shanghai” will have a target release time frame of March 2023. This upgrade will enable Beacon Chain staked ether withdrawals.

The upgrade is a highly anticipated one, as it will enable users to withdraw their staked ether, which is currently impossible. This will open up a number of opportunities for users, such as the ability to earn rewards on their staked ETH, as well as the ability to use the staked ETH for everyday transactions.

Ethereum is currently the second-largest blockchain network, and its success has been attributed to its solid foundation and its ability to handle a large number of transactions. With the upcoming “Shanghai” hard fork, the Ethereum network is set to become even more powerful and reliable, as well as more accessible to users.

The Ethereum network promises to be an even more powerful and reliable network, as well as a more accessible one for users. With the upcoming “Shanghai” hard fork, users will be able to withdraw their staked ether, allowing them to reap the rewards of their investments. This opens up a number of opportunities for users, such as the ability to earn rewards on their staked ETH, as well as the ability to use the staked ETH for everyday transactions.

As the Ethereum network continues to grow and evolve, the number of users staking their ether is sure to increase. With the upcoming hard fork, users will be able to withdraw their staked ether, and this will open up a world of possibilities. From earning rewards on their investments to using their staked ETH for everyday transactions, the Ethereum network is sure to become even more powerful and reliable.