Bitcoin hits a two-month high, and the SEC targets Gemini

Bitcoin prices tested the $21,000 level; Gemini and Genesis Global Capital faced a lawsuit from the SEC, the Ethereum team confirmed the timetable for the Shanghai hard fork, and other events of the past week.

Bitcoin price tests the $21,000 level

Last week proved positive for Bitcoin — the price began to rise on January 9, overcoming resistance at $17,000. The following impulse to $19,000 was accompanied by higher trading volumes. This happened against the backdrop of inflation data in the United States.

Glassnode reported that realized volatility of Bitcoin and Ethereum has fallen to extreme lows, historically preceding explosive moves in either direction.

This week the average hash rate of digital gold hit an all-time high after the December downturn.

On January 14, prices tested above $21,000. At the time of writing, the leading cryptocurrency was trading around $20,900.

By the end of the week, all top-10 cryptocurrencies by market capitalization were in the green. Cardano posted the strongest gain, its price rising 26%.

Total cryptocurrency market capitalization surpassed $1 trillion. Bitcoin’s dominance index stood at 39.4%.

Bitcoin’s first transaction marks 14 years

Fourteen years ago, on January 12, 2009, Bitcoin made the first transaction in the cryptocurrency, sending 10 BTC to cryptographer Hal Finney.

U.S. DOJ seized Robinhood shares owned by Sam Bankman-Fried

The U.S. Department of Justice seized 55,273,469 Robinhood shares (about $450 million) belonging to FTX founder Sam Bankman-Fried. The department also took control of more than $20 million. The funds were held by the brokerage firm ED&F Man Capital Markets.

About 117 potential buyers expressed interest in acquiring units of the FTX exchange undergoing bankruptcy. At the end of the week, the court approved their sale.

Meanwhile, FTX Group advisers restored access to assets worth more than $5 billion, which can be used to pay affected creditors.

SEC files suit against Gemini and Genesis Global Capital

Earlier this week, media reported that the SEC and the U.S. Department of Justice began examining the nature of Digital Currency Group (DCG)’s relationship with its OTC platform Genesis Global Capital.

On January 9, GBTC jumped 12%. The market reaction coincided with news that Morgan Stanley bought Grayscale Bitcoin Trust shares for $3.6 million through a European fund. The daily gain was the largest since February 2022. GBTC’s discount to NAV narrowed from a record 49% to 44%.

The next day, Gemini co-founder Cameron Winklevoss, in another open letter, urged DCG head Barry Silbert to resign over the outstanding $900 million debt under the Earn program by Genesis Global Capital. According to Winklevoss, Silbert-led structures misled the public about their financial condition and solvency.

At the end of the week, media reported that Genesis Global Capital’s debt exceeds $3 billion. As part of fundraising efforts, DCG is considering selling $500 million of assets from its venture capital portfolio.

Interest in DCG assets has already been shown by Tron founder Justin Sun. He said he is prepared to allocate up to $1 billion for this purpose.

Gemini and the crypto-lending platform Genesis Global Capital faced a lawsuit from the SEC. The regulator accused the companies of selling unregistered securities under the Earn program.

What about Binance?

According to media reports, U.S. authorities have shown interest in the relationships between American hedge funds and Binance as part of an anti-money-laundering investigation.

Forbes journalists noted that in the past month the exchange faced a significant outflow of assets — over the last two months it lost about $12 billion.

Ethereum developers confirm Shanghai hard fork timeline

Ethereum developers said that the Shanghai hard fork will be activated on the testnet in February and on the mainnet in March. The update includes EIP-4895, which will allow withdrawals of ETH from the Beacon Chain staking contract. In response to the announcement, governance tokens for liquid staking platforms such as Lido Finance rose.

Mass layoffs continue

Crypto exchange Coinbase will lay off another 950 employees as part of a 25% cut in operating costs. Since June 2022 this will be the third wave of layoffs affecting 2,110 staff. The exchange will also wind down much of its operations in Japan.

ConsenSys, the company behind MetaMask, announced plans to sever ties with 100 or more employees.

The exchange and wallet operator Blockchain.com will lay off 110 employees (28% of staff) as part of cost-cutting efforts in the crypto winter.

The cryptocurrency platform Crypto.com announced a new round of layoffs — the cuts will affect 20% of its staff, said CEO Kris Marszalek.

Binance chief Changpeng Zhao, by contrast, said the company would increase its headcount by 15–30% in 2023.

What to discuss with friends?

• Former FTX leadership accused of spending $40 million on luxury hotels and meals.
• CoinMarketCap accused of conducting fake airdrops.
• WhiteBIT became a partner of Ukraine’s national football team.
• Bill Gates questioned the disruptive potential of metaverses.

Voyager Digital gains approval to sell assets to Binance.US

The bankrupt crypto broker Voyager Digital has received initial court approval to sell its assets to Binance.US. If the deal is completed, Voyager clients could recover up to 51% of their funds. Users will be transitioned to the Binance platform, after which withdrawals will resume.

Despite the approval, the company said the offer faced resistance from the SEC, the U.S. Department of Justice, regulators in New York, Texas, Vermont and Hawaii, as well as Alameda Research, which is undergoing bankruptcy proceedings.

El Salvador’s parliament passes law to issue bitcoin bonds

The law will provide a legal framework for issuing digital assets, including Bitcoin-backed bonds. The enacted document will also provide protection for issuers and consumers in the crypto space from fraud. Oversight and regulation will be handled by a new body — the National Commission on Digital Assets.

Flare network token airdrop took place

On January 9, airdrop of Flare network tokens, designed to create cross-chain and Internet of Things–friendly dapps, took place.

4.279 billion FLR were distributed to millions of users, including clients of cryptocurrency exchanges Binance, OKX, Kraken, Bithumb, UPbit, KuCoin and BitBank. They went to holders who had at least 1 XRP as of the snapshot on December 12, 2020.

Report: crypto industry losses from hacks in 2022 rose to $3.6 billion

In 2022, the Web3 industry’s losses from 167 major attacks totaled about $3.6 billion. This was 47.4% higher than the year before, Beosin said. More than half of the total losses came from 12 cross-chain-bridge incidents — $1.89 billion. DeFi protocols were attacked 113 times (67.6% of total hacks).

Polygon team proposes to conduct a hard fork

The developers of the Ethereum scaling platform Polygon proposed to conduct a hard fork. If approved by the community, the update was scheduled for January 17, 2023. The proposed upgrade aims to smooth gas-fee peaks and reduce the time of potential blockchain reorganizations.

Also on ForkLog:

• The SEC and CFTC filed a lawsuit against a participant in the Mango Markets DeFi attack.
• An expert pointed to fixes to Binance’s shortcomings in BUSD operations.
• Authorities in Europe uncovered a cryptocurrency scam.
• The media called for disclosure of anonymous guarantors of Sam Bankman-Fried.

What else to read?

The 2022 year in review is in, but ForkLog’s annual report on key changes across industry segments has just been published.

In traditional digests, the week’s main events in cyber security and artificial intelligence were also compiled.

The decentralized finance (DeFi) sector continues to attract heightened attention from crypto investors. ForkLog has gathered the most important events and news of the past weeks in the digest.

Read ForkLog’s bitcoin news in our Telegram — cryptocurrency news, prices and analysis.