THE ENDING IS SO NOT CLEAR…
Celsius’ problems will (probably) never end, Binance SEO CZ criticism for FTX SEO Sam Bankman-Fried, and more.
Coo! It’s a Crypto Owl! I’m looking for crypto news as responsibly as Liam Neeson is looking for his daughter in his movies.
On Today’s Menu:
🌮SPICY TACOS: Celsius shifted 25k wrapped Bitcoin to FTX exchange
🌯BURRITOS: CZ criticizes Sam Bankman-Fried for his loan to Voyager
🍕VEGAN PIZZA: Genesis liquidated 3AC
🫒 OLIVES: Crypto news around the web
CELSIUS MOVED 25K WRAPPED BITCOIN TO FTX: CONCERNS OF DUMPING ARE HERE AGAIN
So, I guess the crypto community should probably forget how it feels like to be calm and safe. Because what’s going on right now… It’s just crazy!
It’s not enough for Celsius; one problem leads to another problem, and we have a never-ending cycle of issues.
Recently, the Celsius network moved 25k wrapped Bitcoin (wBTC) to the FTX exchange. If you think 25k is not that much, well, it’s a $529 million value. So.. it is a lot.
Why is it bad news?
The reason is unclear why Celsius made such a large transfer;
This transfer could cause a dump of a wBTC on the exchange;
The dump could cause a crash in BTC prices. AGAIN.
Why this could be a good sign?
There is some hope that wBTC will be swapped for BTC;
It could mean that Bitcoin withdrawals will be possible again on the Celsius Network;
In the past 24 hours (from 7th to 8th July), Bitcoin has risen by ~8%, reaching $22k at 4 am. Now it’s at ~$21.8k.
Celsius CEO Alex Mashinsky remains silent.
I don’t want to sound pessimistic, but I wouldn’t be excited about this move. Because the last time, as Celsius has been removing wBTC and Ether from AAVE and sending it to FTX, staked Ether (sETH) lost its peg. And then the whole sh*tshow started. So I think this situation with wBTC could be very similar.
CZ CRITICIZES SAM BANKMAN-FRIED AND HIS DECISIONS
Binance CEO Changpeng Zhao, known as “CZ”, had a critical opinion about FTX CEO Sam Bankman-Fried’s actions.
In yesterday’s newsletter, I wrote that to save the now-bankrupt Voyager Digital, Sam Bankman-Fried gave it a $500 million loan through Alameda Research, a company also owned by Bankman-Fried. But, the funniest part is that when Voyager failed, it turned out that Alameda itself owed Voyager $377 million! I like how the tables have turned. Too bad it’s too late to save Voyager.
Anyway, back to CZ and his criticism, the CEO of Binance said that he “would never do that type of deal”. Well, yes, that would be a logical decision.
He adds: “That was surprising even to me, to be honest. I try not to comment on our competitors or industry peers. <...> I would never say, 'I will invest in your company and then you loan me some money.' I would just not invest in that company, I'll keep my money."
Exactly.
GENESIS LIQUIDATED 3AC
Another one. Joined the list of companies (Voyager, BlockFi, FTX, etc.) that liquidated the Three Arrows Capital (3AC).
Just look what Genesis CEO Micheal Moro wrote on Twitter almost a month ago:
He mentions a “large counterparty who failed to meet a margin call” to Genesis.
Now, this “large counterparty” appears to be a 3AC.
So, what happened?
According to the tweets of Michael Moro:
The loan to 3AC weighted average margin requirement of over 80%; this means that 3AC had to maintain this amount of value. Otherwise, Genesis will sell the collateral.
So, this is what basically happened. 3AC didn’t meet the margin, and Genesis found “the optimal strategy to further isolate the risk” and sold their collateral.
The companies already liquidated 3AC have all suffered significant losses - Voyager just went bankrupt, and BlockFi is also walking a thin line. Based on this decision to liquidate 3AC, could Genesis fail in the future? I’ll be there to watch it.
MORE CRYPTO NEWS AROUND THE WEB
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Disclaimer: This newsletter is strictly educational. None of this information is intended to be financial advice. Always do your own research and act responsibly with your profits.