This SNAFU unfortunately means that those assets won't be available to be repaid to FTX customers, although this loss is relatively small compared to the total amount owed.
On November 16, Gemini halted withdrawals from Earn after Genesis halted withdrawals after FTX collapsed. Since then, Gemini and Genesis have been engaged in a very public battle, with Gemini's founders accusing Genesis and its parent company of misconduct and demanding the return of the $900 million in Gemini customer funds.
- "SEC Charges Genesis and Gemini for the Unregistered Offer and Sale of Crypto Asset Securities through the Gemini Earn Lending Program", U.S. Securities and Exchange Commission
Like the first round of layoffs, they were performed via email to employees' personal emails, because access to internal systems had already been cut off. The public blog post acknowledged that the strategy "feels sudden and harsh".
Crypto reporter Colin Wu has also reported that the company is requiring all employees to begin accepting their salaries in Tether or USDC stablecoins, or face dismissal. Rumors on Twitter emerged that internal communications channels had been shut down to quell dissent over the change.
Some crypto advocates commenting on the change maintained that there should be no difference to employees if they receive salaries in stablecoins vs. real money, but none seemed able to elucidate any legitimate reason that an exchange might find itself unable to pay salaries except in stablecoins.
At least they're not being asked to take salaries in USDD, the Tron-based stablecoin associated with Justin Sun. USDD depegged even further from its peg (which has been unstable since around October 2022), dipping to around $0.97.
Michel said in his defense that he "never intended to rug but the community went way too toxic". In a press release, an IRS Special Agent stated, "Michel can no longer blame the NFT community for his criminal behavior."
Mutant Ape Planet — though clearly based on it — is unaffiliated with the Mutant Ape Yacht Club project, a Yuga Labs-created spin-off of their own Bored Ape Yacht Club.
- "Non-Fungible Token (NFT) Developer Charged in Multi-Million Dollar International Fraud Scheme", U.S. Attorney's Office of the Eastern District of New York
Genesis is currently in a really bad spot, halting withdrawals from their lending arm in the wake of the FTX collapse and warning of bankruptcy shortly afterwards. The company owes $900 million to customers of Gemini, and Gemini's CEO recently sent an open letter to Genesis's parent company demanding the funds be returned.
Silvergate announced that they would be cutting 40% of their staff — around 200 employees. They also announced that they would be taking a $196 million impairment charge on assets they purchased from Diem — Facebook's blockchain-based payment system once known as Libra. "Given the significant changes in the digital asset industry landscape, this charge reflects the Company’s belief that the launch of a blockchain-based payment solution by Silvergate is no longer imminent," they wrote.
Silvergate's stock plunged 41% on the news.
- "Silvergate Raced to Cover $8.1 Billion in Withdrawals During Crypto Meltdown", The Wall Street Journal
- "Silvergate Capital cutting headcount 40%, takes $196M impairment charge", Seeking Alpha
- "Silvergate Announces Select Preliminary Fourth Quarter 2022 Financial Metrics and Provides Business Update", Seeking Alpha
The lawsuit seeks to permanently bar Mashinsky from engaging in similar business in the state, and seeks disgorgement, damages, and restitution.
- "Attorney General James Sues Former CEO of Celsius Cryptocurrency Platform for Defrauding Investors", New York Attorney General
Fanatics purchased a 60% stake in Candy Digital in a $100 million Series A round in October 2021. Now, they've sold the stake to a group of investors led by Galaxy Digital for an undisclosed amount, in what Rubin wrote was "a rather straightforward and easy decision". He highlighted Fanatics' ability to "realize [when] things aren't working", he wrote in the email.
After many attempts over the span of a year to contact Paul, directly and via his manager (who CoffeeZilla did speak with), Paul has claimed that CoffeeZilla made no attempts to get his side of the story. Instead of addressing any of the many well-researched claims about the flagrant (alleged) grift that Paul has been perpetrating, he has instead reacted in typical (alleged) cryptoscammer fashion: by threatening to sue CoffeeZilla.