The Week in Crypto – FTX, Argo and Bitcoin ETFs
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This week in crypto we’ve seen Sam Bankman-Fried enduring a week from hell, the SEC fighting back in its Bitcoin ETF argument with Grayscale, and Argo Blockchain staving off bankruptcy…for now. If you’re sitting comfortably, then I’ll begin.
No. 3 – SEC Answers Back in Grayscale Bitcoin ETF Case
The Securities and Exchange Commission (SEC) this week made its first comments on the lawsuit filed against it by Grayscale over its decision not to award the company a Bitcoin ETF. Grayscale had applied to turn its GBTC platform into a Bitcoin ETF, but when this was rejected in June, Grayscale filed legal proceedings on the very day.
The SEC argued that “the two products are not the same” and have “fundamental differences in the ability to detect and deter fraud and manipulation”, which is why they rejected the conversion. It bolstered its case by highlighting a statement from the New York Stock Exchange that “fraud and manipulation may exist and that bitcoin trading on any given exchange may be no more uniquely resistant to fraud and manipulation than other commodity markets.”
No. 2 – Argo Blockchain Keeps the Wolf From the Door
Troubled Bitcoin miner Argo Blockchain this week managed to stave off bankruptcy, although it has admitted that it may not see out the month. Following news at the end of October that it needed emergency funding to continue operating and the suspension of its shares on Friday, the crypto world was full of expectation that yesterday would bring an announcement of Chapter 11 bankruptcy, especially after a drafted announcement was accidentally posted to its website and then taken down.
However, Argo has said that it is working on an “equipment financing transaction” that will keep it going for the short term, but admitted that its future isn’t looking good. Times are famously tough for Bitcoin miners right now, and although the difficulty rate has dropped a little in recent days, this is still not enough to make Bitcoin mining a worthwhile pursuit at present.
No. 1 – Sam Bankman-Fried’s Week From Hell
This week saw FTX co-founder and disgraced former CEO Sam Bankman-Fried arrested by Bahamas police at the request of U.S. officials, just hours before he was due to testify before a U.S. House finance committee. Bankman-Fried was arrested on multiple charges including wire fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy and money laundering.
Bankman-Fried was denied bail, after which the then SEC formally charged him with three counts of fraud, arguing that he “orchestrated a years-long fraud” to conceal multiple things from FTX’s investors. He has swapped his billion dollar apartment for the Bahamas Department of Correctional Services where he will stay until his extradition hearing, which is slated for February 8, 2023.
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Filed under: Bitcoin - @ December 17, 2022 9:00 am