Bankman-Fried Confined To Parents’ Cali Home | Inside Teflon Tether

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SBF EXTRADITED, MAKES BAIL, MOVES IN WITH PARENTS

In the space of three days, former billionaire Sam Bankman-Fried went from a Nassau, Bahamas jail to a federal court in New York, which freed him on a $250 million personal recognizance bond and sentenced him to supervised house arrest at his parents’ residence in Stanford, California, until a January 3 court date.

After a Bahamas judge approved the extradition on Wednesday, the founder and former CEO of the FTX crypto exchange appeared in New York on Thursday, where he was freed in a deal that required only that his parents pledge their home equity and that he promise to return to court in lieu of $250 million bail. He faces a slew of charges in connection with the collapse of FTX, including wire fraud, conspiracy to commit money laundering and campaign finance violations, to which he has yet to plea, but he has repeatedly denied intentional wrongdoing.

His top lieutenants—Caroline Ellison, who was CEO of the trading firm Alameda Research, and FTX cofounder Gary Wang—have pleaded guilty to fraud, mainly engaging in a scheme to divert and misappropriate FTX customer funds, U.S. Attorney Damian Williams announced Wednesday night.

ONE OF THE LARGEST CRYPTO MINERS FILES FOR CHAPTER 11

Convertible noteholders are leading a bankruptcy refinancing of Core Scientific with a plan to acquire 97% of the equity in a reorganized version of the crypto miner in exchange for up to $75 million of debtor-in-possession financing. The Ad Hoc Noteholder Group, which represents more than 50% of the holders of Core Scientific’s secured convertible notes, will provide $56 million of that sum and will seek an additional $19 million from others who hold that paper, the company announced Wednesday.

The Austin, Texas-based miner filed for Chapter 11 bankruptcy protection in the Southern District of Texas on December 21, court papers show. It has listed assets and liabilities of $1 billion to $10 billion each, with 1,000-5,000 creditors. The top creditor, BRF Finance, is owed $42.4 million. BRF, a unit of lender B. Riley Financial, had made a competing rescue offer that would not have involved bankruptcy, according to a statement from Michael Bros, Core’s senior vice president of capital markets and acquisitions, which was filed as part of the bankruptcy proceedings.      

Source: Forbes Digital Assets, powered by Nomics.  Prices as of 11:00 a.m. on December 23, 2022.

BINANCE.US TO BUY VOYAGER’S ASSETS

The American franchise of the world’s largest crypto exchange, Binance, will purchase the assets of the embattled crypto lender Voyager Digital for about $20 million. The remainder of the $1.02 billion bid involves what a Voyager press release calls the current market prices for its assets, noting that the final value will be set in the future. As part of the deal, Binance.US will get the right to acquire 3.5 million of Voyager’s customer accounts. Once the funds get transferred and then dispersed to clients, which will not happen until the bankruptcy court decides the prorated share that each account will receive, it will be up to Binance.US to try to retain the customers and their assets.

The structure of this deal is similar to the September agreement between Voyager and FTX.US, the U.S. affiliate of crypto exchange FTX, which would have sent $51 million to Voyager in exchange for moving what was at that time $1.422 billion worth of crypto to FTX. Voyager will seek the approval of the bankruptcy court to enter into the asset purchase agreement at a hearing on January 5. The sale will be conducted in accordance with a Chapter 11 plan, which will be subject to a creditor vote.    

VISA WANTS TO BRING ETHEREUM USERS ONE STEP CLOSER TO BEING THEIR OWN BANKERS

On Monday, the credit giant released a proposal that would let owners of the ether cryptocurrency set up automatic payments directly from their self-custodial wallets—one that would not require banks or other centralized entities to be part of the picture. While the service is far from groundbreaking to pretty much anyone who has a bank account, the proposal, resulting from an internal hackathon hosted by Visa earlier this year, would go a long way to making the often-obtuse world of crypto more approachable for consumers.

According to Catherine Gu, Visa’s head of central bank digital currencies and protocols, the company is also working with independent Ethereum developers on increasing the transaction volume capacity, security, privacy and interoperability with other blockchains.        

ELSEWHERE

Binance, Alone At The Top After FTX, Stirs ‘Too Big to Fail’ Crypto Worry [Bloomberg]

Washington Needs A Crypto Rethink [The New Yorker]

FTX Seeks To Claw Back Sam Bankman-Fried’s Political Donations [Financial Times] 

Nina Bambysheva
Reporter
Forbes Money & Markets

Steven Ehrlich
Editor 
Forbes CryptoAsset & Blockchain Advisor

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