Cryptocurrency

Sam Bankman-Fried did financial system a favour

14 Nov 2022

The curly-haired cryptocurrency kingpin pushed regulators and politicians to legitimise assets like bitcoin. A few more years and his now-bankrupt exchange FTX would have burrowed deeper into mainstream finance, amplifying the damage. His downfall sends the process into reverse.

Capital Calls: Twitter ads, Supervoting stock

11 Nov 2022

Concise views on global finance: Elon Musk is giving big brands an easy out – and a drain on advertising is harder for Twitter to overcome than Facebook; a dual-class share structure enabled the ousted CEO of TuSimple to team up with his co-founder and sack the board.

FTX crash is old lesson for financial newcomers

9 Nov 2022

The crypto exchange, once valued at $32 bln, hangs in the balance after rival Binance scrapped a rescue bid. Customers could face losses; a prolonged selloff could ensue. While it may not comfort founder Sam Bankman-Fried, the cryptoverse will be better off for FTX’s agonies.

Crypto’s JPMorgan mutates into Bear Stearns

8 Nov 2022

Sam Bankman-Fried’s FTX, last valued at $32 bln, provisionally agreed to sell its non-U.S. business to rival exchange Binance. After playing industry lifesaver, he’s now being rescued. The reversal will sting backers like SoftBank and exposes the immaturity of digital currencies.

NFTs may not get back up off the canvas

7 Nov 2022

Global non-fungible token sales have dropped over 90% since January. Enthusiasts remain hopeful that NFTs can branch into new, more durable applications that are less like trinkets. But with rate rises upending niche assets, don’t bet on it.

Lisbon tech schmooze takes baby steps to reality

4 Nov 2022

Amid 2022’s cratering valuations, venture capitalists attending the Portugal-based Web Summit are appropriately more cautious about new startups. Yet crypto crowds are still out in force. That’s despite the need for tech cash to focus more on solving problems like climate change.

Kim Kardashian makes an example out of the SEC

3 Oct 2022

Imposing a $1.3 mln fine on the Instagram star marks an attempt to warn other crypto promoters. It’s unclear how much impact such social-media influencers have on the market, though. Without real teeth, SEC Chair Gary Gensler risks exposing his lack of tools to regulate properly.

Ethereum energy cut necessary but insufficient

15 Sep 2022

The blockchain used to trade ether revamped its process of awarding new coins in an effort to manage power usage. The new plan, which forces people to offer collateral to facilitate transactions and earn new coins, is smart. But it doesn’t address the speculative nature of crypto.

Capital Calls: Crypto fans, Disney’s magic bundle

1 Sep 2022

Concise views on global finance: MicroStrategy founder Michael Saylor is enthusiastic about bitcoin, and its “freedom and self-sovereignty”. A lawsuit over his alleged tax avoidance shows digital limits. Meanwhile, Disney looks to channel the synergistic Force.

D.C. turf war opens crypto regulatory arbitrage

18 Aug 2022

The Fed issued the latest salvo in a regulatory tussle, requiring banks to alert the agency when they offer services for bitcoin and its ilk. The SEC and CFTC are also fighting to oversee the $1 trln market. It’s an opportunity for digital currency outfits but hurts token owners.

Moelis’ crypto foray is a bottom-ticking flier

25 Jul 2022

Investment banks often launch advisory initiatives at the top of hot markets. The boutique led by Ken Moelis is instead pushing into blockchain as the market is imploding. The business looks ripe for consolidation. If Moelis culls market share, it may have cracked a new model.

Comatose watchdogs evoke Great Recession flashback

14 Jul 2022

Crypto lender Celsius slipped through regulatory cracks at the state and federal level. Failures in isolation aren’t big enough to be systemic. But SPACs, too, are crumbling, and people are getting hurt. As sirens wail, like 15 years ago, financial police sleep through it.

EU crypto rules will cheer banks and deter minnows

6 Jul 2022

Europe’s digital asset legislation set clearer guidelines on cross-border transactions. That’s good for big banks keen to mix it with the likes of Coinbase and Binance. But while those bigger crypto beasts are able to swallow higher compliance costs, smaller fry will struggle.

Sam Bankman-Fried bailouts flag crypto’s fragility

22 Jun 2022

The wunderkind’s businesses coughed up $750 mln to help ailing brokers Voyager Digital and BlockFi. The rescues suggest the sector cannot easily withstand the failure of just a few players. And winners like Bankman-Fried may not save the $900 bln industry if prices tank again.

Bankman-Fried derivatives plan too clever by half

17 Jun 2022

Crypto wunderkind Sam Bankman-Fried wants to disrupt how derivatives are cleared. The plan relies on tech rather than human discretion to manage risk. While it’s innovative and could bring in retail traders, large customers aren’t excited. It’s a solution in search of a problem.

MicroStrategy is a conglomerate with bitcoin twist

16 Jun 2022

The software firm sits on a $3 bln pile of deflating bitcoin, bought as part of an unusual bet by founder Michael Saylor. While the shares have collapsed, the company oddly trades above the value of its component parts. There’s no reason it should.

Crypto crash lays bare upstarts’ minimal progress

13 Jun 2022

The plunge in bitcoin and other digital currencies has vaporised $2 trln of market value since November. But the pain falls mostly on punters trading tokens rather than banks or companies. Crypto fans will have succeeded the day that everyone else must worry about their blowups.

Crypto smackdown does more harm than good

8 Jun 2022

The SEC wants firms that safeguard digital assets to mark that risk on their balance sheets. That means certain lenders may have to hold more capital against crypto. Though guardrails are useful, the measure could shut out banks like Goldman and incentivize more shadowy businesses.

Venture royalty bets $4.5 bln on self-disruption

26 May 2022

Andreessen Horowitz’s new crypto fund comes less than a year after its last one. The former backer of Facebook and Airbnb reckons blockchain-based giants will conquer the web by rewarding users. If true, that should also mean less money for venture capitalists.

Review: War on digital payment fails to hit target

20 May 2022

Brett Scott’s “Cloudmoney” seeks to remind the world of the value of physical cash. It’s true that an overly automated system of money carries risks like the potential for surveillance. But the campaigner underestimates consumer demand for digital transactions.