Bitcoin Mining Bankruptcy | Crypto Exec Exodus

SBF’S HOT POCKETS

Sam Bankman-Fried has again proved himself to be the savior of the crypto world this week as he won the auction for embattled brokerage Voyager Digital’s assets. The U.S. unit of FTX will pay Voyager $1.42 billion, an 8% premium to the market value of the assets, and then turn the crypto over to investors through new accounts at FTX US that will offer them incentives to remain. The purchase agreement between FTX US and Voyager will be presented to the U.S. Bankruptcy Court for the Southern District of New York on October 19 and will be subject to a creditor vote, according to Voyager’s announcement on Tuesday. According to Bloomberg, Bankman-Fried is also considering bidding for the assets of bankrupt lender Celsius Network and is in the process of raising a $1 billion funding round for FTX.

CRYPTO LOSES TWO MORE TOP EXECUTIVES

FTX US may have picked up a couple of million customers as part of a winning bid for Voyager Digital’s cryptocurrency assets, but it’s losing a president. Brett Harrison said on September 27 that he is stepping down from that position. “Over the next few months, I’ll be transferring my responsibilities and moving into an advisory role at the company,” Harrison tweeted Tuesday.

Earlier that day, Alex Mashinsky, founder and CEO of bankrupt crypto lender Celsius Network, also resigned. “I regret that my continued role as CEO has become an increasing distraction, and I am very sorry about the difficult financial circumstances members of our community are facing,” wrote Mashinsky in a resignation letter.

Last week, Jesse Powell said he is relinquishing his top position at cryptocurrency exchange Kraken, which he founded in 2011. In August, Sam Trabucco, co-CEO of Bankman-Fried’s trading firm Alameda Research, made a similar announcement.

Source: Forbes Digital Assets, powered by Nomics. Prices as of 4:00 p.m. on September 30, 2022.

The True Value Of Cryptocurrencies

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JIHAN WU RAISES FUNDS TO PURCHASE MINERS’ ASSETS

Digital mining company Bitdeer Technologies Holdings, led by crypto-billionaire Jihan Wu, is attempting to raise $200 million from outside investors to buy discounted hardware despite strong headwinds for the mining industry and an icy outlook from Wall Street. With bitcoin down 58% year-to-date and the cost of power on the rise globally, mining margins have shrunk and many miners do not have the cash to finish paying for recently acquired gear.

Wu is the cofounder of the world’s largest computer-chip company for bitcoin mining, Bitmain. After settling a lengthy disagreement with the other cofounder, Micree Zhan, he took control of spin-off Bitdeer. The company will start its acquisition plans with a $50 million investment and aims to raise an additional $200 million from outside investors like family offices, venture capital firms and investment funds.

CFTC GOES AFTER DAOS

The Commodity and Futures Trading Commission (CFTC) last week fined a DAO called bZeroX, ordering the collective to pay $250,000 for illegal leveraged/margin trading of digital assets and failing to adopt “know your customer” programs. The amount is negligible, but the case marks the first occasion of an action brought against members of a DAO by the CFTC and could have wide-ranging consequences for future regulation.

Additionally, now Ooki DAO—a successor to bZeroX—is facing similar charges, and the CFTC is using unconventional methods to pursue action. According to court documents filed on Tuesday, members of Ooki DAO were notified of the lawsuit when a CFTC paralegal posted the complaint and other documents to an online discussion forum meant for DAO members to discuss governance issues. The documents were also submitted through a help chat box on the DAO’s website.

BLOCKCHAIN 50: CALL FOR 2023 NOMINATIONS

For four years the Forbes Blockchain 50 list has chronicled the institutional adoption of technology popularized by bitcoin. Since the inaugural roundup in 2019 the enterprises on our list—often household names like Walmart and Boeing—have moved beyond test projects and now rely on distributed ledgers in key parts of their businesses to improve efficiency and transparency. Now is your chance to help us find the best possible honorees for next year’s issue. We look for businesses valued at $1 billion or more or those that generate at least $1 billion in annual revenue and have made meaningful use of the technology. Read more here.

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