News Updates November 14, 2022
1. Bitcoin Surging After Elon Musk Says ‘BTC Will Make It, but Might Be a Long Winter’. On Monday (14 November 2022), the Bitcoin price, which had fallen below $16,000 to reach its lowest level in over a year, started surging shortly after bullish comments from Tesla, SpaceX, and Twitter CEO Elon Musk, as well as from Binance Co-Founder and CEO Changpeng Zhao (aka “CZ”). According to data byTradingView, just before the tweets from Musk and CZ (which were sent out around 6:40 a.m. UTC on 14 November 2022), Bitcoin was trading around $15,948 (having fallen below the $16K roughly two hours earlier), and shortly after the tweet, the $BTC price started surging, reaching $16,821 by 7:51 a.m. UTC):
It all started yesterday (13 November 2022) when angel investor and entrepreneur Jason Calacanis asked on Twitter where Bitcoin’s price (which reached an all-time high of around $69,000 on 10 November 2021) would be in a year from now:
Roughly a day later, Musk, who bought Twitter for $44 billion in late October 2022, sent out a tweet that suggested he remains confident in Bitcoin’s future:
D.A. Wallach 7h
@dawallach·
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Replying to @Jason
"I think it’ll be fine. BTC is still cool".
Elon Musk@elonmusk
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"BTC will make it, but might be a long winter"
2. Crypto Exchange AAX Suspends Withdrawals as FTX Failure Reverberates
The suspension for as long as 10 days was blamed on the failure of an unidentified third party. The Hong Kong-based exchange has said it has no exposure to Sam Bankman-Fried’s company.
Crypto exchange AAX said it had suspended activity, citing a scheduled upgrade that had been delayed by turbulent markets.
The failure of a third-party partner means services will be delayed for as long as 10 days, the Hong Kong-based company said Sunday. The exchange did not identify the partner, and has said it has no exposure to FTX, a rival whose collapse has caused chaos in the industry.
“Withdrawals have been suspended to avoid fraud and exploitation,” the company said. “AAX will continue our best efforts to resume regular operations for all users within 7-10 days to ensure the utmost accuracy.”
Users’ balances have to be manually restored after a partner failed, causing the system to record abnormal data, the company said. Vice-President Ben Caselin tweeted that the delay was being taken as an “extra precaution” following scheduled maintenance.
On Friday, the company, which launched in 2019 as the first external user of the London Stock Exchange Group’s (LSEG) matching technology, said it had no financial exposure to FTX or its affiliates. It stores a “substantial amount” of its assets in cold wallets and doesn't lend out user funds to venture activities, it said.
FTX filed for bankruptcy protection in the U.S. on Friday, and CEO Sam Bankman-Fried resigned. There have also been reports of FTX’s assets being hacked, and of the exchange using customer funds to prop up its trading arm Alameda.
A spokesperson for the London Stock Exchange told CoinDesk it was not the third party referred to by AAX and that there were "no issues" with its systems.
3. Solana losses more than half its value: What’s next for SOL?
The FTX liquidity crisis hit the crypto industries, and retail investors are seeking an emergency exit by selling their stakes and investing in safer government bonds because central authorities do not back decentralized cryptocurrencies. If this liquidity crisis persists for a long time, then the value of all cryptocurrencies, such as Bitcoin, Ethereum, and Solana, will further decrease.
Last week, the leading cryptocurrencies were in deep trouble, and Solana, being a popular cryptocurrency, was in the red. This week investors are not confident about buying their stake because they are worried about the future potentialities of these cryptocurrencies and their sustainability for the long term.
Binance’s CEO came up with the solution with a recovery fund, but it has not been implemented yet. That is why we can find buying opportunities in Ethereum and Bitcoin, but the mid-cap cryptocurrencies such as Solana are still in the red.
If you are interested in the future projects and wide use cases of Solana, you have to wait for the next few months to understand the momentum before investing for the long term. You can read our SOL prediction and analysis by clicking here to get a short- and long-term trend after this downfall.
Solana prices might change drastically because the U.S. Congress and SEC are checking the issue of the FTX liquidity crisis, so any news can change the performance of cryptocurrencies in the next few weeks.
4. Crypto.com claims user funds safe despite ‘accidental’ Ether transaction
The chief executive of Crypto.com, said the exchange’s exposure to FTX when it shut was under US$10 million.
Singapore-based cryptocurrency exchange Crypto.com transferred 320,000 Ether, close to 80% of its ETH reserves worth around US$400 million at the time, to rival exchange Gate.io, instead of sending it to a new cold storage address, a move that CEO Kris Marszalek called accidental.
Marszalek hosted a live Q&A on Monday to take questions from investors and clarify the exchange’s stance on the transaction, as well as answer questions on other pressing issues in the industry.
The following Q&A has been edited for language and brevity.
Please explain your process to validate sending funds to the correct addresses. Where was the breakdown in the US$400 million moved incorrectly?
Kris Marszalek: The first thing I want to clarify is that every single address that our systems allow funds to be sent to, is whitelisted and pre-approved. There is no way that systems can go to an address that we can’t control and get the funds back from. So people were speculating if we had to go and ask [Gate.io] to return the funds to us. No, we could just withdraw the funds and send [them] back because it was our corporate account with them. It’s just that the amount was so large that it was above their daily withdrawal limit, so we asked them to increase our daily withdrawals, and that was the extent of their help.
Is it true that you’ve stopped withdrawals?
Marszalek: This is absolutely not true. We’re operating as usual again. There is a heightened level of activity, which means higher trading volumes, more revenue for us, and also higher numbers of deposits and withdrawals. What you will see is that in our customer service tickets, there was some backlog there. We are working hard and making sure that you get answers for customer service in a timely manner, but withdrawals are absolutely core and withdrawals are working, and will always be working. This is absolutely fundamental.
5. Ukraine’s Cyberpolice Expose Members of Crypto Fraud Scheme Making €200 Million a Year.
A report shows Ukrainian Cyberpolice identified members of a group that defrauded people around the world through fake crypto investment offers. The criminal organization maintained offices and customer service centers with thousands of employees in a number of European countries.
Cyberpolice Department Busts Ukrainian Arm of International Financial Fraud Scheme
The cybercrime combatting unit of the National Police of Ukraine (NPU) has exposed five Ukrainian citizens accused of participating in a large-scale international scheme that lured victims with promises of high profits from fake investments in cryptocurrencies and securities.
The entity behind the criminal undertaking had established representative offices and call centers across Europe, Ukrainian police officials revealed. The estimated annual losses resulting from its activities exceeded €200 million ($207 million), a press release detailed.
The operation was carried out together with the NPU’s Main Investigative Department, the Prosecutor General’s Office of Ukraine and assisted by Europol, the European Union Agency for Law Enforcement Cooperation, and Eurojust, which is the EU’s body for judicial cooperation.
Law enforcement authorities from Albania, Finland, Georgia, Germany, Latvia, and Spain also helped the investigation against the organization which launched in Ukraine in 2020. Seven countries have initiated court proceedings in relation to the case, the Cyberpolice said.
