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Sam Bankman-Fried

FTX Wins Auction for Voyager Digital’s Assets

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FTX and Binance were pursuing the purchase of Voyager. In July, FTX submitted a proposal for Voyager, which was turned down as a “low-ball offer.” 

Early in July, Voyager stopped allowing consumers to withdraw their money as cryptocurrency values fell. Then, as creditors of the firm in bankruptcy court, its clients were compelled to line up alongside experienced restructuring attorneys and financiers as inexperienced participants in a potentially lengthy procedure in order to recover their cash.

The assets of Voyager were put up for auction this week through the bankruptcy court. The billionaire Sam Bankman-FTX Fried’s exchange and Wave Financial, a digital asset investment company, squared off in the last round.

FTX steals the show

Sam Bankman-billionaire-founded Fried’s digital asset exchange, FTX US, won the bidding for the assets of defunct crypto firm Voyager Digital Ltd.

According to a statement released by Voyager Digital on Monday in New York, the arrangement is worth roughly $1.4 billion, made up of an “extra compensation” of about $111 million and the $1.3 billion market value of every cryptocurrency held by the insolvent company.

After the bankruptcy process is through, customers will be able to switch to the FTX US platform, according to Voyager, who also stated that the acquisition agreement would be submitted to the court on October 19 for approval.

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FTX Wins Auction for Voyager Digital’s Assets 2

The acquisition comes after multiple prior attempts by Sam Bankman’s exchange to rescue or buy Voyager. At the end of March, the New York-based network had 1.19 million funded accounts and around 3.5 million users.

After an unsuccessful attempt by Alameda Research, a trading firm connected to FTX, to save Voyager with a revolving line of credit, the company filed for bankruptcy protection in July.

Alameda said in September that it will pay back the $200 million in BTC and ETH it had acquired from Voyager by month end.

Bankman-Fried has been relentlessly acquiring struggling cryptocurrency businesses this year, snatching up millions of users and priceless technology for less than they were worth.

Earlier this year, FTX supported the cryptocurrency platform BlockFi and was considering buying out Robinhood Markets Inc.

The current auction which ended up in Sam Bankman’s favor lasted for two weeks.

Reports Suggest That FTX Is Raising $1 Billion to Ramp up Acquisitions

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FTX is trying to ramp up its expansion and acquisition spree. According to reports, Sam-Bankman Fried’s cryptocurrency exchange FTX is in discussions with potential investors to acquire $1 billion in fresh cash as it seeks to use the additional funds for financial acquisitions during the down market.

The discussions are still ongoing, and the specifics might yet alter, according to a report from CNBC on September 21 that cites persons familiar with the situation. The fundraising amount would maintain the FTX’s existing worth of almost $32 billion if it turned out to be genuine.

In addition to the $400 million raised in January, the prospective $1 billion investment round might indicate significant investor confidence in the company despite the industry’s protracted crypto winter.

FTX to expand its acquisition game

Some of the fresh funds will reportedly be used for additional dealing in the cryptocurrency field, according to unnamed sources. This is not surprising considering how active FTX and SBF’s quantitative research company Alamada Research have been throughout the bear market.

Since July, when Bankman’s exchange laid out a joint bid with Alameda to acquire troubled crypto lender Voyager Digital following its bankruptcy filing, there have been rumblings about a prospective takeover of Voyager Digital by Bankman’s exchange.

The plan was criticized by Voyager, which called it “a low-ball bid disguised up as a white knight rescue” and a move “intended to generate notoriety for itself rather than value for Voyager’s consumers” in bankruptcy court documents in New York.

The Wall Street Journal (WSJ) reported on September 20 that FTX and Binance are now the top bidders for Voyager’s assets, with FTX’s offer coming in just under $50 million and Binance’s estimated to be about the same amount. Both bids have not yet been approved, according to the WSJ, and the auction is still open until September 29.

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Reports Suggest That FTX Is Raising $1 Billion to Ramp up Acquisitions 4

An investment arm of the company called FTX Ventures announced earlier this month that it will pay an unknown sum to purchase a 30% share in Anthony Scaramucci’s asset management company SkyBridge Capital.

As part of larger aspirations to grow into Canada, the exchange also signed a deal to buy Canadian cryptocurrency platform Bitvo in June. An agreement for a $400 million revolving credit line and an option to purchase BlockFi for about $240 million was also struck by FTX US and the ailing lending company a month earlier.

FTX Clarifies: ETH Trading To Remain Open Through Out The Merge

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Bahamian cryptocurrency exchange FTX has clarified that trading on Ethereum would remain active all through the merge and will only suspend [and not halt] deposits and withdrawals of wrappers and layer 2.

These are Arbitrum One, Solana [Wormhole], and Binance Smart Chain [BSC] which will be reopened after the Merge is completed and networks return to stability, the updated blog read.

FTX deleted the original tweet which said it would temporarily disable blockchain transfers of secondary chains for ETH to ensure the settlement is clean. Nevertheless, CEO Sam Bankman-Fried a.k.a. SBF later confirmed that trading would stay unaffected.

One month ago, the crypto spot and derivatives exchange announced that ETH-related futures markets would not be impacted before the scheduled merge.

The trading platform with its headquarters in the Caribbean nation of Bahamas elucidated via a blog post that it won’t suspend or settle ether derivatives like futures and perpetual before the integration and that it plans to continue live trading throughout the event.

FTX- “We will do our best to support continuous trading”

The exchange also informed users that its Ethereum futures and perpetual contracts [ETH-0930, ETH-1230, ETH-PERP] will monitor the proof of stake in Ethereum after the Merge. “We will do our best to support continuous trading,” it added.

As per CoinGecko, FTX is the second-largest cryptocurrency exchange in terms of daily derivatives trading volume. The exchange has supported derivatives contracts worth $7.5 billion as per the latest data.

Among other crypto assets, the exchange also provides futures and perpetual contracts with ether as their underlying value.

In addition to that, data from various reports noted that the aggregate open interest of ether futures across exchanges has increased from $5 billion in mid-June to more than $7.7 billion in August.

Moving away from the existing energy-intensive proof of work [PoW] mechanism, the much-awaited ETH update is expected to increase the network’s through-put, and make it cost-effective as well as environmentally friendly.

That also means the end of the miners’ income streak, thus eliminating a huge portion of rewards for contributing to the blockchain.

Here is Sam Bankman-Fried’s crypto roadmap for 2022

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Sam Bankman-Fried a.k.a SBF, CEO, and founder of trading platform FTX reflected on the growth of the crypto industry in 2021 and shares his expectations for the new year in his detailed post. Through a series of tweets, the exec at first talks about how the digital asset industry has an edge over the legacy institutions in terms of large userbase, smart contracts, varied use cases, etc but still have few lingering issues such as lack of regulatory clarity, limited transaction scalability that needs to be taken into considerations moving forward.

At the beginning of the post, Sam Bankman points out the uneasiness between industry and regulators who are often at loggerheads as seen in several cases around the world. The exec noted,

“On one hand, it’s not clear what the process is for token issuance, platform registration, and stablecoins in many jurisdictions. This makes it hard for the industry to move forward as securely, and hard for institutional players to get involved. On the other hand, many regulators have found it very difficult working with crypto companies: instead of working collaboratively, we’ve seen a ton of examples of tension boiling over.”

Next, he weighs on the blockchain scalability which the exec thinks is inadequate at the current pace of 50k TPS as industrial-scale applications often require millions. And, while digital assets hold huge promise for payments, SBF laments, in reality, very few are done with them today. That being said Sam Bankman put forward a few proposals for the coming year.

Sam Bankman-Fried’s key focus for 2022

Starting off, the Chief Exec insists that the need of the hour is to work in collaboration to effectively address the existing regulatory gaps while at the same time allowing liquidity to move to places like the US, or to Europe, and other jurisdictions. Stablecoins for that matter presents the perfect use case in this context.

According to SBF, the key focus should be to ‘create a reporting/transparency/auditing-based framework to ensure they are backed as they say they are. This would solve 80% of the issue while allowing stablecoins to thrive onshore’. Secondly, there should be standard markets oversight, in a unified regime that creates similar standards for spot, futures, etc. And third, a disclosure, registration, and anti-fraud-based regime for token issuances.

Turbulent Times for COVER Protocol as Experts Call it a ‘Stealthy Rug’

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It is no longer news that decentralized finance [DeFi] is one of today’s buzzing topics among crypto enthusiasts. Wherever there is tremendous popularity and hype, predators are there. And thus, investors and traders are highly skeptical of any product offering because of the nascent nature of this space.

The latest platform that has come under tight scrutiny by community experts is the COVER protocol and its founding team more specifically. Jason Choi, the Founder of ‘The Blockcrunch Podcast’, criticized the project and revealed he was hopeful that about Cover protocol and thought that it could be a viable addition to DeFi insurance, but the team’s “repeated reckless decisions” suggested otherwise.

Jason Choi went on to claim,

“70% of new supply is rewarded to a new yield farm, to be launched. SAFE1 farm and dumpers are irrelevant. SAFE2 holders who backed the project now own 17% of the project vs 100%”

Unveiled in September this year by Chefinsurance, the Cover protocol is basically insurance to the DeFi’s smart contracts. These are inherently risky. The protocol promised to address the biggest obstruction to the DeFi space, which happens to be the involvement of humans.

Its native SAFE token witnessed two massive pumps in its price which was then followed by and two huge dumps. This happened when the token was called ‘SAFE’ and the other, after its migration to SAFE2. The SAFE token saw a meteoric surge of a whopping13,500% driving its price all the way to roughly $73,640 before crashing to the press time price of $3.66 per token.

With respect to SAFE2, soon after the token migration on the 26th of September, the token climbed all the way to $700 before dropping by nearly 90%, at an approximate press time value of $88.86.

It all started with the departure of its lead investor, Azeem Ahmad. It was primarily due to dumping and the inexperience of developers, which led to several prominent players in the industry taking over the insurance protocol.

Notably, Cover Protocol’s official blog post claimed to have received grants from Andre Cronje and Blue Kirby, both from Yearn.Finance. Additionally, Sam Bankman-Fried, the CEO of FTX was also mentioned as one of the key advisors of the platform to which he commented,

It is important to note that this isn’t an isolated bizarre event. Both SBF and Andre Cronje are two very popular and vocal industry experts on Twitter and their alleged involvement in several other projects have been a bone of contention for quite some time. SBF was recently accused of allegedly borrowing YFI and destroying its price, before later selling it on Binance. Cronje, on the other hand, was in the receiving end of a severe backlash and was also sued over his unfinished Eminence Finance [EMN] project, which was hacked.