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Attorney Deaton Says It’s “Absolute Nonsense” to Claim SBF Had Good Intentions For FTX Customers

Lele Jima
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Attorney Deaton Says It’s “Absolute Nonsense” to Claim SBF Had Good Intentions For FTX Customers

Attorney Deaton does not believe SBF had good intentions following his actions.

The cryptocurrency community has continued to comment on the sudden collapse of FTX, which wreaked havoc on the entire industry. More than a week after FTX collapsed, members of the cryptocurrency are still commenting on the incident.

Attorney John Deaton, the founder of Crypto Law, a media outlet that covers U.S. legal and regulatory news for cryptocurrencies, joined many crypto stakeholders to comment on the FTX saga.

Deaton’s comment on the issue were in response to a tweet made by Mario Nawfal, CEO of IBC Group. Nawfal claimed that FTX insiders revealed that the exchange’s founder Sam Bankman-Fried (SBF) had good intentions. According to Nawfal, his sources disclosed that SBF started lying when things grew too fast and out of his control.

“Verified FTX Insider: SBF had good intentions, but things grew too quickly too fast & got out of hand. SBF lost control. SBF started lying, and this led to compulsive lying, backed up by a false sense of altruism that led him to believe his own lies leading to his demise,” Nawfal said.

Deaton Responds to Nawfal’s Claims

Responding to Nawfal’s tweet, attorney Deaton described the comment as “absolute nonsense.” Deaton, representing over 75,000 XRP holders in the Ripple vs. SEC lawsuit, said SBF can’t have good intentions after stealing “$10 billion of customers’ funds.” 

The Crypto Law founder said SBF was able to gain access to customers’ funds via his acquisition of BlockFi, a crypto lender FTX bailed out with a $250 million loan earlier this year.

“[SBF] gets no benefit because there is zero doubt,” attorney Deaton added.

Another Crypto Stakeholder With Similar Sentiments

Many people do not believe SBF had good intentions. Prominent cryptocurrency whistleblower Thierry Arys Ruiz also agreed with attorney Deaton. 

FTX Sudden Collapse and Subsequent Troubles

As reported last week, FTX, a former leading cryptocurrency exchange, suffered a major collapse, with sources claiming that over $8 billion black hole was discovered in its balance sheet.

Trouble started for the former-leading cryptocurrency firm after Coindesk noted in a report that SBF had used FTX’s balance sheet to further loans. A pseudonymous crypto researcher Dirty Bubble Media piled further pressure on FTX last week by asking whether the company was insolvent. Dirty Bubble Media noted that SBF might have found a way to hack the global financial system by printing billions of dollars from nowhere.

On November 6, 2022, Changpeng Zhao (CZ) brought the attention of crypto investors to the FTX saga after announcing that Binance would liquidate its FTT tokens holdings, worth around $580 million. CZ claimed Binance is not against FTX in any way. However, the world’s largest exchange will not support anyone who lobbies behind other industry players.

Since the announcement, FTX’s woes have soared. SBF announced that he filed FTX, FTX.US, and Alameda Research for Chapter 11 bankruptcy proceedings. The United States Justice Department, as well as two top legal firms, are investigating the FTX Group’s collapse. Tether, the official issuer of USDT, has also commenced freezing all USDT accounts linked to FTX, based on authorities’ request.

582 Billion Shiba Inu (SHIB) Leaves ShibaSwap

Zabi
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582 Billion Shiba Inu (SHIB) Leaves ShibaSwap

Over 582.73 Billion Shiba Inu (SHIB) moved out of ShibaSwap in the past 24 hours.



The wallet labeled “timmie.eth” unstaked an alarming 572.60 Billion Shiba Inu (SHIB) from ShibaSwap and transferred his total SHIB holdings, including unstaked SHIB, to the unknown wallet in the past 24 hours.

Ethersan.io data reports that the wallet labeled “timmie.eth” unstaked a shocking 572,601,096,091 (572.60B) SHIB, worth $5,061,793 ($5.06M) from ShibaSwap in one significant transaction executed about 9 hours ago. After a few minutes of unstaking, the wallet transferred his total Shiba Inu holdings i.e., 582,732,098,558 (582.73B) SHIB, worth $5,139,697 ($5.13M) to an unknown wallet in a single robust transaction and left himself with Zero SHIB.

572.60 Billion Shiba Inu Unstaked in the Past 24 Hours
572.60 Billion Shiba Inu Unstaked in the Past 24 Hours

Whereas, the receiving wallet’s SHIB balance increased by 582.73B SHIB to a whopping 583,195,705,359 (583.19B) SHIB, worth $5,155,450 ($5.15M).

Unknown Wallet Received 582.73 Billion SHIB from timmie.eth
Unknown Wallet Received 582.73 Billion SHIB from timmie.eth

Shiba Inu still maintains its top position as the biggest holding in dollar value among the largest 2000 ETH Whales. As per WhaleStats, the top 2000 ETH whales collectively hold $80,326,737 ($80.32M) worth of SHIB in their wallets.

On the other hand, Shiba Inu fails to defend its crucial support located at $0.0000093 on the daily chart and breaks lower following the widespread selloff in the global crypto market. As of writing, Shiba Inu is trading at the price of $0.000008744, down -9.91% over the last day, with a 24-hour trading volume of $262,673,995 ($262.67M).

13,000 ETH Burned In A Few Days As FTX Collapse Causes Surge In On-Chain Transactions

Mark Brennan
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13,000 ETH Burned In A Few Days As FTX Collapse Causes Surge In On-Chain Transactions

FTX collapse has an unexpected effect on Ethereum.

A surge in on-chain transactions has led to the burning of 13,000 ETH in just three days, according to data from Etherscan.

It comes as users rushed to take their assets off exchanges as rumors of FTX’s insolvency took hold. Former FTX CEO Sam Bankman-Fried, in a message to staff, indicated that the now-bankrupt crypto exchange processed over $6 billion in client withdrawals in just three days, according to a Reuters report. It is a severe jump from an average of about tens of millions daily. 

Ethereum hourly withdrawals on FTX reached a new all-time, according to crypto pundit Lark Davis’s tweet on Monday. Consequently, the increased burns due to increased on-chain transactions and Ethereum’s significantly reduced daily issuance post-Merge have ensured that the crypto asset has achieved deflationary status. 

The ultrasound.money ETH supply chart shows that the token’s supply took a nosedive on Monday just after Binance’s Changpeng Zhao declared that the exchange was liquidating its FTT position triggering the FTX bank run. As a result, the annual issuance now sits at -0.032% after a steep drop in the last couple of days. Furthermore, data shows that Ethereum’s supply has dropped by 6,158 ETH post Merge.

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It is worth noting that Ethereum has held up better than Bitcoin in the wake of the FTX collapse. Compared to Ethereum, which did not even put in a new yearly low, Bitcoin tapped two-year price lows at $15,682.

As highlighted above, FTX and about 130 other subsidiaries and sister companies this week filed for chapter 11 bankruptcy after a bank run confirmed suspicions of shady financials. Notably, the once-second-largest crypto exchange in the world loaned a considerable amount of user funds to its sister company Alameda Research collateralized by its exchange token FTT, which is highly illiquid.

On Monday, SBF still gave users assurances that the exchange was fine. But, notably, things have taken a turn for the worse as it appears someone has hacked the crypto exchange and withdrawn over $300 million worth of assets. This further reduces the chances of users getting fair compensation for their holdings through bankruptcy proceedings.

Scott+Scott Now Investigating FTX Collapse

Lele Jima
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Scott+Scott Now Investigating FTX Collapse

 

FTX Legal Woes Continue As Another Top US Law Firm Launches Investigation Into the Exchange’s Activities.



Scott+Scott, an international law firm focusing on complex litigations across U.S. and Europe, has announced that it is investigating the collapse of FTX to determine whether its executives violated United States securities laws.

The law firm urged investors of FTT, the native cryptocurrency of FTX, who suffered huge losses in the exchange’s collapse, to contact its attorney Sean Masson.

“If you purchased FTX securities (e.g., FTT tokens or its high yield-bearing accounts) and have suffered losses to your FTX investments, you are encouraged to contact Scott+Scott attorney Sean Masson at (212) 822-5522 or smasson@scott-scott.com,” the law firm noted in a press release.

FTX Legal Woes Soar

The recent development further increases Sam Bankman-Fried and FTX’s legal woes. As reported yesterday, a top United States law firm Rosen announced that it has started investigating the collapse of FTX. The rationale behind the move is to enable the company to prepare a class action against the former leading cryptocurrency exchange and its founder to help investors recover their losses.

Rosen and Scott+Scott are not the only entities investigating the FTX incident. The United States Justice Department revealed earlier this week that it was also investigating the matter to ascertain whether the exchange misappropriated customers’ funds. In other news, Tether has commenced freezing USDT accounts linked to FTX based on authorities’ requests.

FTX Sudden Collapse

On November 2, 2022, cryptocurrency news outlet Coindesk reported that the balance sheet of Alameda Research was being used as collateral to further FTX’s loans. Two days later, a pseudonymous cryptocurrency researcher known as Dirty Bubble Media asked if FTX was insolvent, adding:

“It’s almost as if SBF found a way to hack the financial system, printing billions of dollars out of thin air against which he was able to borrow massive sums from unknown counterparties.”

Changpeng Zhao, Binance CEO, and founder made matters worse for FTX after he announced that the exchange would liquidate its position in FTT, which was worth approximately $530 million at the time.

CZ noted that Binance did not make the decision to move against its competitor, FTX. However, he said Binance will not support “support people who lobby against other industry players behind their backs.”

FTX and Alameda Research, were plunged into a series of troubles, which exposed the state of FTX’s financial holdings. Sources claimed that a huge hole of $6 billion was found in the exchange’s balance sheet. All moves to salvage the situation, including the last-minute attempt made by Binance to acquire FTX, did not yield positive results.

Left with no other option, FTX filed for Chapter 11 bankruptcy. While many people thought FTX’s woes were over, the admin in charge of the exchange’s Telegram group disclosed that hackers had hijacked the trading platform. Users were urged not to access the FTX website as it might download Trojans onto their devices.

These unfortunate developments caused the value of FTT to dip from a weekly high of above $25 to a paltry $1.91 today.

Dogecoin UP, Records $1.5B Inflows After Elon Musk Comment “Doge To The Moon”

Lele Jima
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0
Dogecoin UP, Records $1.5B Inflows After Elon Musk Comment “Doge To The Moon”

Dogecoin surges after Elon Musk’s comment.



Dogecoin recorded a huge inflow today after Elon Musk made a surprise appearance in a Twitter space and chanted “DOGE to the Moon.” 

According to data from Crypto Vinco, Dogecoin recorded an inflow of $1.5 billion shortly after Musk commented.

The huge amount of funds pumped into the world’s largest canine-themed cryptocurrency also boosted the price of DOGE to 12%. DOGE moved from $0.079 to $0.089 in one hour, according to data on Coingecko.

Musk Promoting Dogecoin

The development will not surprise many, given that Musk has been instrumental in promoting Dogecoin’s widespread adoption and price in recent months. Musk’s effort contributed to putting Dogecoin on the right path for the previous all-time high (ATH) of $0.73, the token set last year.

As reported, DOGE rallied over 100% last month after Musk completed the acquisition of Twitter. Many crypto enthusiasts believe the world’s richest man will find a way to accept DOGE payments for some Twitter services. Cardano founder Charles Hoskinson also noted that he expects Dogecoin to somehow merge with the social media platform.

FTX Hacker Swaps 400 Billion Shiba Inu To Ethereum

Albert Brown
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FTX Hacker Swaps 400 Billion Shiba Inu To Ethereum

400B Shiba Inu from Hacked FTX Funds Swapped to Ethereum (ETH).



An address labeled as “FTX Accounts Drainer” appears to have recently converted a whopping 400B SHIB ($3.9M) from the hacked FTX funds to 2,346 ETH ($2.96M), incurring an approximate loss of $1M in the process.

Amidst the escalating FTX hack situation, an address dubbed “FTX Accounts Drainer” just recently swapped 400 billion SHIB tokens worth approximately $3.9M to 2,346 ETH valued at $2.9M on CoW Protocol. Blockchain security platform Peck Shield recently highlighted the development.

“The address 0x59ab…32b labeled as FTX Accounts Drainer has swapped 400,000,000,000 $SHIB (~$3.9M) to 2,346 $ETH (~$2.96M), -$1M,” Peck Shield disclosed in a tweet Saturday, as an Etherscan dashboard revealing the transaction was shared.

 

Etherscan reveals that the address executed a swap of 400B Shiba Inu tokens to 2,346.2 ETH on the CoW Protocol on November 12, a few hours after the recent FTX hack. The transaction, which saw 400B SHIB dumped at once, appears to have impacted the asset’s price, as Peck Shield disclosed. Shib is currently trading at $0.000009477, down 7%.

Recall that The Crypto Basic recently disclosed a recent hack targeting FTX.com and FTX US, which resulted in the withdrawal of about 593 billion Shiba Inu tokens worth over $5.7M from both platforms in the early hours of Saturday. Following the hack, reports of $1B in missing customer funds on FTX surfaced.

The hack seemed imminent because many investors have sought avenues to take out their funds from FTX.com. The exchange suspended withdrawals in other regions but kept them open for accounts in Bahamas. FTX US was also reported to have suspended withdrawals. Several proponents have solicited help from Bahamian users by sending them funds for taking out. Notwithstanding, this has not been particularly successful, as FTX has suspended transfers between accounts within the platform.

However, some users discovered a way to bypass the roadblock by selling NFTs on the FTX NFT marketplace, as disclosed by prominent crypto influencer Cobie. The Bahamian account had withdrawn up to $21M worth of USDT as of Friday.

This underlines how desperate investors are regarding funds withdrawal, indicating that most of them would resort to risky efforts to achieve this, and desperation often exposes people to exploits.

Terra Classic Community To Access More Scam Protections With Allnodes Anti-Scam Services

Mark Brennan
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Terra Classic Community To Access More Scam Protections With Allnodes Anti-Scam Services

Allnodes launches new features to prevent users from losing their delegated tokens.


The Terra Classic community can now access extra security features to prevent scammers from going away with their delegated tokens via a new Allnodes service, according to network validator Classy in a tweet yesterday.

The Anti-Scam Help service is available to everyone using Allnodes to stake assets in the Cosmos ecosystem, the company writes in its blog post. The service helps users withdraw their undelegated assets immediately after the unbonding period expires. 

Notably, in many instances where hackers have gained access to user wallets and undelegated user assets, they have been able to beat users to the punch to withdraw them first. It is this problem that Allnodes hopes to solve with its new service.

Users can choose from two Anti-Scam Help service options, the free Regular Service or the Premium Service, which charges a percentage of the funds recovered should Allnodes succeed.

Allnodes, in a disclaimer, warns that the service does not guarantee the recovery of user funds. However, it increases the chances.

Notably, nothing is charged to the user of the Premium Service if the recovery attempt fails. However, Premium service users are more likely to recover their funds as Allnodes broadcasts their withdrawal transaction to multiple network nodes than a single node with the Free Service. Consequently, with the Premium Service, it is more likely that the withdrawal transaction gets processed before the scammer’s transaction.

It is worth noting that Keplr, Ledger, and Cosmostation are the only wallets that currently support the service. Consequently, users must create a wallet with one of these platforms to use the service.

It comes in addition to scam protection proposals passed on the Terra Classic chain to give users an added sense of security. Notably, due to its budding community, scammers are increasingly targeting the LUNC community.

Classy, who shared the Allnodes announcement, was also the author of a Terra Classic proposal that increased the minimum requirements for users to make and initiate voting on proposals on the Terra Classic network. The proposal came in response to the rise in scam proposals on the Terra Station.

Terra Classic Burns Exceed 27B with Total Staked LUNC Surpassing 850B

Albert Brown
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Terra Classic Burns Exceed 27B with Total Staked LUNC Surpassing 850B

Terra Classic (LUNC) burns have cumulatively exceeded 27 billion tokens, with total tokens staked surpassing 850B.



The campaign to revive Terra Classic (LUNC) asset remains on track, as the community has witnessed a total cumulative burn of 27.1B LUNC tokens since the campaign kicked off, with total staked tokens amounting to 852.3 cumulatively.

The exciting achievement was highlighted by “LUNC Burn” – an unofficial community-driven Twitter handle that tracks LUNC burn transactions. “Total burned $Lunc: 27.1b,” the handle noted in a tweet Saturday, as it shared more insight on the state of the asset’s supply.

It was also revealed that 208.61M tokens had been burnt in the past 24 hours, following the 0.2% rate adjustment. In addition to the 27.1B LUNC already burnt, investors have staked up to 852.3B LUNC tokens, the handle revealed. The staked tokens represent 12.38% of the asset’s total supply of 6.8 trillion.

 

Out of the total supply of 6.8 trillion tokens, 86.7%, which amounts to 5.9 trillion LUNC represents the asset’s current circulating supply.

Binance, in particular, has been contributing the most to support the community’s burn campaign. However, regarding its off-chain burns, the exchange switched from a weekly report to a monthly basis after its fifth batch of burns. Validators Allnodes and LUNCDAO have also been active in effecting burns burning 30M and 22M LUNC, respectively, on OCT 24.

Binance’s latest batch reported a burn of 1.2B LUNC on October 31. The next report is slated for December 2. Besides the LUNC burns, CZ recently revealed that Binance retains its Terra Classic holdings.

As several ideas come in from all angles to introduce more effectiveness in the revival campaign, The Crypto Basic recently reported a suggestion from Terra Classic developer Alex Forshaw which would concurrently burn $2M worth of LUNC.

Deaton Excited As Paradigm Files Amicus Brief Supporting Ripple Against SEC

Lele Jima
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Deaton Excited As Paradigm Files Amicus Brief Supporting Ripple Against SEC

Another entity opposes SEC’s claim in an ongoing lawsuit against Ripple.



Paradigm Requests to File Amicus Brief Against SEC’s Characterization of Crypto Assets As Securities.

Cryptocurrency-focused investment firm Paradigm has filed a motion requesting permission to file an amicus brief in the ongoing lawsuit between Ripple and the Securities and Exchange Commission (SEC).

According to Paradigm, its amicus brief is focused on shedding light on a subtle but significant distinction that will define the impact of the case on the crypto market. The company’s amicus brief is against the SEC’s characterizing crypto assets as securities. Paradigm noted that the case is beyond what is seen on the surface.

“On the surface, this case is about whether certain offers and sales of XRP tokens were securities offerings. But the SEC’s rhetoric goes further than its claims require or the law supports. It asserts that XRPtokens, and by extension many other crypto assets, are themselves securities,” it said.

Supportive Document Backing Paradigm’s Argument

Paradigm said the SEC’s attempt to conflate an investment scheme with the cryptocurrency sold in the scheme is fundamentally inconsistent with the country’s existing securities law.

The company attached as an exhibit Lewis Cohen’s book dubbed Ineluctable Modality of Securities Law: Why Fungible Crypto Assets Are Not Securities (“Why Fungible Crypto Assets Are Not Securities”).

The book published by Cohen et al. reviewed and analyzed all U.S. federal cases that have ever applied the Howey test, which the Ripple case is currently based on.

“This study confirmed that no federal appellate court has held that an asset that is the object of an investment contract transaction is itself a security, nor that a subsequent transfer of that asset would be a securities transaction (nor has the SEC cited any such authority),” Paradigm added.

Furthermore, Paradigm said it is not new to see the SEC use the Howey test to evaluate fundraising schemes. However, it is relatively new to see the same test applied to XRP tokens.

“It is the foundation upon which the SEC seeks to claim sweeping new authority to regulate not just investment offerings (its proper statutory role), but virtually the entire secondary market for crypto assets,” Paradigm added.

Attorney Deaton Excited

The recent request made by Paradigm to file an amicus brief has prompted a reaction from attorney John Deaton, the founder of Crypto Law and the legal representative of over 75,000 XRP holders in the lawsuit. 

He briefly described the addition of Cohen’s study as great news on a rough day.

Second Round Of Terra Classic Lottery Burns 7.93M LUNC While Winner Gets 18M Coins

Mark Brennan
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Second Round Of Terra Classic Lottery Burns 7.93M LUNC While Winner Gets 18M Coins

 

Terra Rebels burn 7.9 million Terra Classic (LUNC).


Terra Rebels Burn 7.93M LUNC After Second Round Of Terra Classic Lottery Game.

The second round of the Terra Rebels lottery game has ended with the winner going away with 18.3 million Terra Luna Classic (LUNC) and the Rebels sending 7.9 million LUNC to the burn wallet, according to a tweet from Terra Rebels admin ClanMudhorn yesterday.

It brings the total amount of LUNC burned by the game to about 18.5 million LUNC in two rounds. The Crypto Basic reported that the game burned over 10.5 million LUNC after the previous round.

For the uninitiated, the independent Terra Classic developer group launched the game about two weeks ago. It is the first decentralized application that the Terra Rebels have built on the Terra Classic network.

New details reveal that the game has gone through a rebranding process since it first launched. Notably, the game’s theme now depicts a mission to the moon. Developers have changed the name from “Terra Rebels Lottery Game” to “Terra Rebels Moonshot.” Additionally, game rounds are now “Missions, ” participants are called “Astronauts,” the prize money is called “fuel,” and tickets are called “Moon tickets.”

However, despite the rebranding, details from the Terra Rebels Discord show that the modalities of the game remain the same. Moon tickets cost 5000 LUNC, a little above $0.93 at current prices, with each mission lasting seven days. Notably, the game sends 60% of the pool to the winner and 26% to the burn wallet.

Community members excited by the project have started making suggestions to make things more interesting. 

For example, one user noted that the Rebels could issue the tickets for the lottery as NFTs to participants, so they get something as a reward for participating even if they don’t win. At the same time, another added that the game could also have different modes with varying time limits for each round. For example, people with less patience could opt for a 24 hours round, while people who want to stand a chance to win more could opt for a month-long round.

Mission 3 has already started, and LUNC community members can participate by navigating to the “DAPPS” tab on the official Terra Rebels website, according to a tweet by reXx of the Terra Rebels yesterday.

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