Exchanges/Platforms

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.

LME’s best hope is to pay up, then shape up

7 Jun 2022

Elliott Management is suing the London Metal Exchange for voided nickel trades. If it wins its judicial review, the LME could take a flood of further legal blows. Its Hong Kong owner’s best defence may be to pre-emptively compensate angry traders, whilst rebooting governance.

Capital Calls: Microsoft micromanages tech jitters

2 Jun 2022

Concise views on global finance: A 1% revenue shortfall because of a strong dollar normally isn’t that important. Microsoft’s warning reflects how nervous tech investors have become.

Inflation revives spectre of the long bear market

19 May 2022

The S&P 500 Index has fallen almost 20% from its early January peak. Such downturns have become shorter and less frequent due to support from the Federal Reserve, says Edward Chancellor. But rising prices have removed the safety net. The next selloff could inflict more damage.

Wanted: Chillaxed CEO for $21 bln French laggard

18 May 2022

Frédéric Oudéa will depart from SocGen after 15 years at the helm. He leaves a bloated bank with one of the lowest valuations in Europe and an unclear appetite for change. Breakingviews imagines a letter from a headhunter specialising in cushy job placements.

Stablecoin panics may be a feature not a bug

17 May 2022

Crypto tokens like Terra and $80 bln Tether were supposedly pegged to the dollar. Yet the former failed and the latter wobbled. Holding 100% cash reserves would help. But there’s no fun, or money, in that. Users can always flock to the new, sketchy coin offering juicy rewards.

ICE’s Black Knight deal has antitrust snare

13 May 2022

The NYSE owner is paying a big premium to round out its mortgage tech dominance with the servicing-focused Black Knight. But the combination looks to pose antitrust problems, and a loose merger agreement gives ICE room to blow up the deal if it runs into resistance.

SoftBank’s Son is running out of ammunition

12 May 2022

The stock market values the $60 bln technology conglomerate at half the sum of its parts. In the past, founder Masayoshi Son has used buybacks to prop up the shares. High leverage and slumping markets make that tricky. More radical measures, like a breakup, seem off the table.

Stablecoin crash drags crypto ideals back to earth

11 May 2022

TerraUSD, a digital token supposedly pegged to the U.S. dollar, slumped to a fraction of that. The popular store of value is vulnerable because its design is based on trading incentives, not hard reserves. For crypto fans there’s a tradeoff between decentralisation and stability.

Stars align for UAE to become a global crypto hub

6 May 2022

Big exchanges Binance, FTX and Kraken are expanding in Dubai and Abu Dhabi as local regulators grant licences to trade virtual assets. The world’s leading financial regulators have been wary of cryptocurrencies. A variety of factors give UAE the chance to steal a march on them.

The elusive value of past investment mistakes

5 May 2022

A new library in Edinburgh hopes to improve financial understanding by studying historical errors. The best investors understand the importance of learning from their painful howlers. Yet, says Edward Chancellor, ultra-low interest rates have induced a kind of collective amnesia.

Didi’s New York woes mask deeper problems

4 May 2022

The Chinese ride-hailing group hopes leaving the Big Board will ease Beijing’s cybersecurity probe. It now faces a U.S. investigation into its IPO. Yet the bigger blow in its new annual report is rising regulatory pressure at home, raising fresh doubts about Didi’s core business.

Robinhood’s growing pains could use some Buffett

3 May 2022

The Sage’s deputy, Charlie Munger, said the platform encouraged short-term gambling. But perhaps not enough: Robinhood is cutting jobs and revenue is falling. New ideas – like accounts that stimulate investment – aren’t horrible, but only if they invoke old, boring philosophies.

Capital Calls: Gap falls through the inflation gap

22 Apr 2022

Concise views on global finance: Shares in the clothing retailer fell over 19% after the company warned of a sharper drop in sales and announced the departure of Nancy Green, the boss of its Old Navy unit.

Twitter’s scarce suitors, Didi’s New York exit

21 Apr 2022

As Elon Musk dangles a $41 billion offer, Breakingviews columnists discuss whether anybody will end up buying the social network in this Viewsroom podcast. Plus, the Chinese ride-hailing firm cancels its U.S. listing less than a year after arriving, leaving shareholders stranded.

China’s overseas oil giant preps for inward turn

21 Apr 2022

CNOOC, booted off New York, popped the maximum 44% on its Shanghai debut. It was well-timed, with sanctions on Russia boosting the fossil fuel’s price. Diplomatic tensions make its foreign business risker, and it may ditch some assets. But there’s plenty to do closer to home.

How metals markets can limit future debacles

19 Apr 2022

UK regulators want answers after the London Metal Exchange voided nickel trades. A supply crunch in a wider range of metals means Europe’s key market can expect more crises. Regaining trust may require new leaders, but the LME can at least reduce the impact of future shocks.

Didi’s peers will pay price of New York debacle

19 Apr 2022

The Chinese ride-hailing group is planning a U.S. exit less than a year after arriving. But shareholders, who have seen the stock fall 85% since the disastrous IPO, have no guarantee of an exit afterwards. The corporate wreck will taint other mainland firms eyeing the Big Board.

An economist’s warning for stock market investors

14 Apr 2022

Most economic theory is far removed from the gyrations of financial assets. A new book from a veteran City of London economist attempts to close the gap. Edward Chancellor explains why his troubling conclusions about U.S. equity valuations deserve to be taken seriously.

Chinese firms’ New York exit hits tricky new phase

13 Apr 2022

Quora-like Zhihu won’t raise a cent from its Hong Kong float, the first so-called homecomer to eschew the chance. It won’t be the last: Many of them are, like the $1.4 bln Q&A forum, cash rich. But insiders are selling. That can weigh on valuations, hurting regular investors.