The Friday Focus: Issue 75
Our weekly K33 Research newsletter.
This week's crypto bombshell detonated on Thursday, with cryptocurrency-focused U.S. bank Silvergate's fresh revelations about its FTX exposure causing industry-wide drama. Get up to date on Silvergate and other crypto-related news in our Friday Focus below.
Top stories
Near 50% fall in Silvergate's shares over FTX exposure prompts survival doubts
SEC Chair Gensler says crypto exchanges may not be 'Qualified Custodians'
Cryptocurrency-focused US bank Silvergate's share price halved after fresh revelations about its FTX exposure and subsequent questions about its survival. That warning caused a flurry of activity, with major partners, including crypto exchange Coinbase, dropping Silvergate in a rush to safety.
In related news, FTX has 'massive shortfall' in assets, according to bankruptcy lawyers. Further evidence of the prevalence of unsustainable business models in crypto came in a court filing revealing Voyager Digital's Reward Program lost $58M in 2022. On a more positive note, Mt. Gox bankruptcy repayments are rumored to finally start but will not destabilize the bitcoin price, according to UBS.
The groundwork for global cryptocurrency rules will be laid out in a coming FSB and IMF Synthesis Paper, according to reports from the latest G20 meetings. The SEC plans to keep growing its crypto unit amid SEC Chair Gary Gensler stating crypto exchanges may not be qualified custodians. Everyone's not convinced of the fruitfulness of SEC's work, though. Some U.S. lawmakers argue SEC's accounting policy undermines safe crypto custody, and Grayscale will argue the SEC is inconsistent as the Bitcoin ETF dispute heads to court.
In the crossover between traditional banking and cryptocurrency, three Japanese banks start a new stablecoin experiment. At the same time, in the U.K., the Bank of England claims blockchain technology is not efficient enough to power CBDCs.
What’s new from our research analysts this week?
March is already here, and in case you're wondering what will drive the markets in the upcoming month, be sure to check out Vetle Lunde's Monthly Market Wrap-up.
PoS eradicates the importance of token inflation in many cases, according to our research analyst Anders Helseth. Read why in the article below.
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