Bitcoin’s Sharp Drop | Credit Card Processor Dumps Binance

Original cryptocurrency fell to its lowest since June.

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Nina Bambysheva Senior Reporter, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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CRYPTO SLUMP

A sharp selloff has ended weeks of relative calm in the cryptocurrency market. Bitcoin slid more than 8% on Friday. Forced liquidations in the futures market on Thursday afternoon helped steepen a decline that began earlier in the week. Other tokens, including ether, XRP and lido staked ether, also fell, pushing the market’s value to $1.11 trillion, down 9% since the prior Friday.

Analysts attributed the plunge to global economic issues and the reassessment of the timeline for introduction of spot-market bitcoin exchange-traded funds in the United States. Attention is focused on China’s deteriorating real estate market and on elevated interest rates in the United States, where the 10-year Treasury bond yields about 4.25%, near its highest level since 2007.

CHECKOUT.COM DROPS BINANCE, CITING REGULATORY CONCERNS

The London-based credit card processing company that ballooned its business model by servicing billions in crypto transactions for Binance clients cut short its contract with the crypto giant this week.

In a pair of letters sent to Binance on August 9 and 11, Checkout CEO Guillaume Pousaz terminated his company’s relationship with its once-largest customer citing “reports of regulators' actions and orders in relevant jurisdictions” and “inquiries from partners.” The second letter, seen by Forbes and sent two days after the first, cited additional concerns over Binance’s anti-money laundering, sanctions and compliance controls, and said the termination would be effective August 17. Checkout spokesperson Lewis Jones confirmed to Forbes the company had ended its contract with Binance.

In response, Binance told Forbes it disagreed with Checkout’s basis for terminating the contract and said it was considering legal action.

CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$26,148

10.9%

Ether (ETH)

$1,666

9.5%

Tether (USDT)

$1

0%

Binance Coin (BNB)

$217

9.2%

XRP (XRP)

$0.5

20.2%

Source: Forbes Digital Assets. Prices as of 3:12 p.m. on August 18, 2023.

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FTX AND GENESIS REACH $175 MILLION SETTLEMENT

FTX-affiliated crypto hedge fund Alameda Research will receive a $175 million claim on the estate of bankrupt crypto lender Genesis Global Capital, according to documents filed Thursday in the U.S. Bankruptcy Court for the District of Delaware.

The settlement marks a significant reduction from the $3.9 billion that FTX’s lawyers requested in May to help compensate creditors in the Bahamas-based exchange’s own bankruptcy case. Referring to the pre-bankruptcy version of the company, the lawyers alleged Genesis “was one of the main feeders of funds for FTX and instrumental to its fraudulent business model.”

COINBASE’S BASE MAKES A SPLASH IN ETHEREUM LAYER 2 BATTLE

The largest cryptocurrency exchange in the U.S. launched its Layer 2 blockchain Base last week, but it already has a greater number of daily transactions (573,000) than similar networks such as Arbitrum (543,000) and Optimism (395,000). In comparison, Ethereum averages about 1 million daily transactions.

A Layer 2 typically refers to a network built on top of another blockchain (commonly known as Layer 1) that helps extend the capabilities of the underlying system.

Elsewhere

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