Cryptocurrencies, tokens, NFTs, virtual "assets" frauds

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All those celebrities pushing crypto not so vocal now​

Basketball player Joel Embiid starring in Crypto.com's new ad titled Bravery Is A Process. PHOTO: SCREENGRAB FROM CRYPTOCOM/YOUTUBE

May 18, 2022

NEW YORK (NYTIMES) - In the latest commercial from the virtual currency exchange Crypto.com, titled Bravery Is A Process, star basketball player Joel Embiid walks through Philadelphia while his former college coach Bill Self lends the narration.
"Even when our path didn't make sense to everyone else, we kept going," Mr Self says in the ad, which made its debut on May 6. "We keep going, until our path is the one they wish they'd taken."
What the ad does not say: The crypto market is in the middle of a meltdown. Buyers beware.
Enthusiasm for crypto from Hollywood celebrities and top athletes reached a fever pitch over the past year. On social media, during interviews and even in music videos, they portrayed virtual currency as a world with its own hip culture and philosophy - one that was more inclusive than traditional finance and that involved the chance to make loads of money.
The US National Football League's Super Bowl was nicknamed the "Crypto Bowl" this year because so many ads - which cost as much as US$7 million (S$9.7 billion) for 30 seconds - featured the industry, several of them starring boldface names.
But after investors watched hundreds of billions of dollars disappear in a sell-off this month, those famous boosters now face intensifying criticism that they helped drive vulnerable fans to invest in crypto without emphasising the risks.
Unlike clothes or snacks or many other products hawked by celebrities, the crypto market is volatile and rife with scams.

"This is real money that people are investing," said Dr Giovanni Compiani, an assistant professor of marketing at the University of Chicago whose research has found that younger, lower-income investors tend to be overly optimistic about crypto's trajectory. "Those who promote it should be more upfront about the potential downsides."
So far, crypto's celebrity boosters have been largely silent about whether they have any second thoughts about their promotions.
Crypto.com declined to make Mr Embiid available to discuss his partnership with the company.

Hollywood star Matt Damon, who compared the advent of virtual money to the development of aviation and spaceflight in a critically panned but widely seen Crypto.com ad last year, did not respond to requests to weigh in.
No response either from basketball star LeBron James, who was featured in the company's Super Bowl commercial this year.


Actress Reese Witherspoon, an Oscar winner who declared online in December that "crypto is here to stay", did not respond to a request for comment.
Neither did actress and entrepreneur Gwyneth Paltrow, who lent her name to a bitcoin giveaway late last year.
Heiress Paris Hilton, who has nearly 17 million followers on Twitter who watch her coo over her lap dogs Crypto and Ether, did not respond to a request for comment.
Neither did several other famous crypto pushers, such as actress Mila Kunis and American football players Aaron Rodgers and Tom Brady (although Brady's and Rodgers' profiles on Twitter still feature laser eyes, a popular symbol of bitcoin bullishness).
A representative for tennis star Naomi Osaka, who became an ambassador for the crypto exchange FTX this year, wrote in an e-mail that "she sadly is overseas and not available".
Crypto's instability underscores a basic fallacy of celebrity marketing: A famous person's endorsement may be memorable but it does not make the product being pushed inherently worth trying.
"If I were Matt Damon or Reese Witherspoon, I would be questioning my willingness to take on this kind of gig," said Syracuse University associate professor of marketing Beth Egan.

 

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"Temasek doesn’t comment on direct investing activities but as of “today, Temasek does not own Bitcoin,” said Pradyumna Agrawal, the fund’s managing director for blockchain investment."

F**king dis-ingenious statement by a foreign talent: "as of today". This could mean that Temasek did own bitcoin (and TerraUSD and Luna) the days, weeks, and months before and could have made a lot, or lost 99% (TerraUSD and Luna).

How much of the citizens' hard-earned reserves have been lost in cryptocurrencies? A few billions?

Singapore’s Temasek says doesn’t own Bitcoin, but prepping for tokenized assets​

The Bitcoin community got a lift last year when it was reported Singapore’s sovereign wealth fund had bought Bitcoin. The company told Forkast in an interview that they do not own BTC, but they are keen on blockchain investments.

Singapore’s Temasek Holdings, one of the world’s top 10 sovereign wealth funds, said it doesn’t currently own Bitcoin, but it is active in blockchain investments and looking at emerging opportunities in the industry.
Temasek doesn’t comment on direct investing activities but as of “today, Temasek does not own Bitcoin,” said Pradyumna Agrawal, the fund’s managing director for blockchain investment, in an interview with Forkast’s Editor-in-Chief Angie Lau.
“But that is not a statement on whether we like Bitcoin or whether we want to own Bitcoin or not,” Agrawal said in the May 13 interview in Singapore. “That is just a factual statement of fact.”
His comments follow media reports last year that said Temasek, which manages a portfolio worth about S$381 billion (US$274 billion) for the city-state, was buying Bitcoin.

The reports at the time were “misinformation which we have chosen not to comment on,” Agrawal said.
Play

However, elsewhere Temasek is letting its wallet do the talking in the industry, and is “very focused on backing the best projects,” Agrawal said.
In February, it led a US$200 million funding round in cryptocurrency firm Amber Group. Also, Australian non-fungible tokens (NFTs) startup Immutable in March raised $200 million in a Series C funding led by Temasek.

Temasek has a flexible mandate toward blockchain companies that prefer raising money through tokenization, Agrawal said.
“We can gain exposure or seek to gain exposure to areas which we think are of interest to us and will deliver appropriate risk-adjusted returns,” he said.
“It’s within our mandate to be able to own tokens,” Agrawal added. But if Temasek wants to be able to directly hold and act on tokens, “you need a completely different set of infrastructure.”

Agrawal (right) sat down with Forkast’s Editor-in-Chief Angie Lau for an upcoming episode of Word on the Block.
Another way of saying Temasek is getting ready to handle tokenized assets?

“I would say it will need some time to ensure that it meets our operating risk requirements and that we can do it at scale,” he said.
In Singapore, it’s not just Temasek that sees opportunities in blockchain technology.
GIC, another major Singaporean sovereign wealth fund, on Thursday led a $170 million Series F financing round in New York-based blockchain data analysis firm Chainalysis.
GIC has also invested in crypto exchange Coinbase and Hong Kong’s digital asset company BC Group.

 

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Police report made against Terraform Labs in Singapore; police not investigating​

A police report was lodged against Terraform Labs and its South Korean co-founder Kwon Do Hyeong last week. PHOTO: BLOOMBERG

Joyce Lim
Senior Correspondent

May 18, 2022

SINGAPORE - A police report was lodged by a "concerned citizen" against Singapore-registered firm Terraform Labs and its South Korean co-founder Kwon Do Hyeong last week.
The complainant claimed to know of more than 1,000 Singaporeans who have invested in UST and Luna and making the police report was to "seek justice for all those who have lost money".
The report, which has been circulating online, also contained the address of Terraform Labs.
Police confirmed the report had been made but did not confirm that they are investigating Terraform Labs.
The Straits Times understands that police are not investigating.
Last week, the price of both TerraUSD - better known as UST - and its affiliated cryptocurrency Luna collapsed following a wave of selling pressure.
UST is a stablecoin that was pegged to the United States dollar using an algorithm.

The Terra blockchain was halted and restored twice, which saw both Luna and UST being delisted from exchanges, including Binance.
The Singapore-registered Terraform Labs co-founded in 2018 by Mr Kwon, better known as Do Kwon, and American citizen Daniel Hyunsung Shin is the driving force behind the Terra blockchain.
The Accounting and Corporate Regulatory Authority record showed the firm had a paid-up capital of $12.

In the wake of last week's chaos, Mr Kwon was apparently trying to promote a plan to revive the Terra ecosystem.
His wife has reportedly sought emergency protection after an unidentified man "trespassed" into their apartment building in South Korea, Seoul police told digital media platform Forkast. She has been provided with security, the report said.
Crypto exchange Coinhako told users on Wednesday (May 18) that trading in Luna and UST will cease at 11.59 pm on the same day and that they could withdraw their UST and Luna holdings if they wanted.
If they do not, Coinhako will convert the remaining Luna and UST balances to Singapore dollars at the prevailing rate and credit them to users' Coinhako SGD wallet.
Crypto investor Ng Yu Jie, 27, said: "The current value of Luna is zero. I get nothing even if I convert or withdraw the coins"
Mr Ng said he had paid $1,500 for 30 Luna coins last December.
On April 6, the value of one Luna more than tripled to $158.
"I was hoping for it to hit 10- to 20-fold before I sell," said Mr Ng.
"I had thought Luna was safe because it was pegged to UST and UST is a stablecoin pegged to the US dollar. I didn't expect the value to drop so sharply and wiped out all my investments in three days."
Mr Ng said he does not think Mr Kwon would be able to revive the Terra network as "people would have lost trust in Terra".

 

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"In fact, cryptocurrencies have yet to prove their worth as a dependable and scalable means of payment versus traditional finance."

Singapore, through the Monetary Authority of Singapore, have been promoting Singapore as a crypto and digital payment hub and even introduced the Payment Services Act 2019. Now the government, through the Shitty Times mouthpiece, is trying to backtrack and say that cryptos is not proven as a payment system.

TerraUSD collapse unlikely to hamper blockchain innovation in S'pore​

The co-chairman of the Blockchain Association Singapore said the country's blockchain ecosystem is well diversified to absorb shocks such as the TerraUSD collapse. PHOTO: BLOOMBERG

Ovais Subhani
Senior Correspondent


MAY 19, 2022, 12:32 PM SGT

SINGAPORE - The blockchain industry in Singapore and elsewhere will survive virtually unscathed from the ripple effects of TerraUSD's shocking meltdown that has shaken investor confidence in cryptocurrencies.
That is because the use of the distributed ledger technology, which forms the foundation of all crypto assets, goes far beyond powering digital currencies. In fact, cryptocurrencies have yet to prove their worth as a dependable and scalable means of payment versus traditional finance.
For instance, Chainanalysis, a Singapore unicorn worth US$8.6 billion (S$11.9 billion), provides blockchain data analytics, risk management, compliance and fraud detection services to government agencies, exchanges and financial institutions.
Another Singapore unicorn, Fireblocks, valued at US$8 billion in its last funding round, is an enterprise-grade platform that delivers secure infrastructure for moving, storing and issuing digital assets.
Unicorns are start-ups that have scaled the US$1 billion valuation milestone.
Last year, J.P. Morgan, DBS Bank and Temasek announced plans to develop a blockchain-powered open industry platform for accelerated cross-border payments, trade transactions and foreign exchange settlements.
The Blockchain Association Singapore currently has about 150 members, and its co-chairman, Mr Chia Hock Lai, said more than a dozen of them are unicorns.

"Singapore's blockchain ecosystem is well diversified to absorb shocks such as the TerraUSD collapse," Mr Chia told The Straits Times.
In fact, the Wall Street crypto crash may accelerate regulation of the market, providing more clarity and confidence to deep-pocketed institutional investors to move in and further energise blockchain innovation, he said.
Regulators worldwide have been raising red flags as genuine investor interest in crypto assets turned into a hype, promoted less by mainstream media and more by maverick experts on social media platforms who often misrepresent cryptocurrencies as a get-rich-quick scheme.

However, concerns that regulatory intervention may suppress private enterprise innovation have so far held back any major moves by most policymakers.
In fact, Singapore's Payment Services Act 2019 is seen as a favourable crypto regulation, described by the Republic's central bank as a forward-looking and flexible framework for the regulation of payment systems, including digital payment token service providers.
However, earlier this year the Monetary Authority of Singapore (MAS) took a tougher stance, repeating for the umpteenth time its warning that trading cryptocurrencies is highly risky and not suitable for the public.
In January, it issued a set of guidelines aimed at limiting crypto firms in advertising their services to the public.

Such warnings and guidelines are still far from the kind of comprehensive clampdown by China, which last year banned all cryptocurrency-related transactions.
The ban triggered a massive sell-off of Bitcoin - the world's first cryptocurrency - wiping out about US$1 trillion from its global market value.
In the wake of TerraUSD's downfall, United States Treasury Secretary Janet Yellen said the incident shows the dangers of private digital coins, which, while unregulated, can present the same kind of risks as bank runs.
A month earlier Ms Yellen gave some clues to her approach to the regulation of digital assets.
"When new technologies enable new activities, products and services, financial regulations need to adjust. But that process should be guided by the risks associated with the services provided to households and businesses, not the underlying technology," she said on April 7.
She said consumers, investors and businesses should be protected against fraud and misleading statements regardless of whether assets are stored on a balance sheet or distributed ledger.
Similarly, firms that hold customer assets should be required to ensure those assets are not lost, stolen, or used without the customer's permission. And taxpayers should receive the same type of tax reporting on digital asset transactions that they receive for transactions in stocks and bonds, she added.
In recognition of the fact that digital assets, including cryptocurrencies, are part of a larger trend - the digitalisation of finance - several central banks including the US Federal Reserve and MAS are planning to launch their own digital currencies.

China's experiment with a central bank digital currency is at a much more advanced stage than most.
Last month, the People's Bank of China announced that it would expand the digital yuan pilot programme to a total of 23 cities. Within days, technology and entertainment giant Tencent announced that it would enable use of the digital yuan as a payment option on its social media and payment app WeChat in the pilot regions.
Yet, most experts believe central banks are unlikely to rush in, amid fears a hasty move may destabilise the financial industry.
"Private initiative will continue to dominate the blockchain ecosystem for years to come," said Mr Chia.
In Singapore, Mr Chia said there are three major areas of focus.
One is enterprise blockchain, which refers to boosting efficiency by streamlining business processes at scale, such as supply chain traceability and transparency, or the settlement of global trade payments.
The other area is institutional investment in not just cryptocurrencies, but also increasingly in digital tokens backed by assets such as corporate bonds, real estate and private equity.
Then there is the trend of consumerisation of blockchain, where retailers can sell their products, including artwork, comic books, collectibles, and games, as non-fungible tokens or via digital marketplaces such as metaverse.

 

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Cryptos are crashing, will NFTs be next?​

OpenSea admitted in January that more than 80 per cent of the NFTs created with its free tool were fraudulent. PHOTO: REUTERS

MAY 22, 2022

PARIS (AFP) - A slew of celebrity endorsements helped inflate a multibillion dollar bubble around digital tokens over the past year, but cryptocurrencies are crashing and some fear non-fungible tokens (NFTs) could be next.
NFTs are tokens linked to digital images, "collectable" items, avatars in games or property, and objects in the burgeoning virtual world of the metaverse.
The likes of Paris Hilton, Gwyneth Paltrow and Serena Williams have boasted about owning NFTs, and many under-30s have been enticed to gamble for the chance of making a quick profit.
But the whole sector is suffering a rout at the moment, with all the major cryptocurrencies slumping in value, and the signs for NFTs are mixed at best.
The number of NFTs traded in the first quarter of this year slumped by almost 50 per cent compared with the previous quarter, according to analysis firm Non-Fungible.
It reckoned the market was digesting the vast amount of NFTs created last year, with the resale market just getting off the ground.
Monitoring firm CryptoSlam reported a dramatic tail-off this month, with just US$31 million (S$42.8 million) spent on art and collectibles in the week to May 15, the lowest figure all year.

A symbol of the struggle is the forlorn attempt to resell an NFT of Twitter founder Jack Dorsey's first tweet.
Mr Dorsey managed to sell the NFT for almost US$3 million last year, but the new owner cannot find anyone willing to pay more than US$20,000.

The year of scams​

Ms Molly White, a prominent critic of the crypto sphere, told AFP there were many possible reasons for the downturn.

"It could be a general decrease in hype, it could be fear of scams after so many high-profile ones, or it could be people tightening their belts," she said.
The industry's reputation has been hammered for much of the year.

The main exchange, OpenSea, admitted in January that more than 80 per cent of the NFTs created with its free tool were fraudulent - many of them copies of other NFTs or famous artworks reproduced without permission.
"There's a bit of everything on OpenSea," said Mr Olivier Lerner, co-author of the book NFT Mine d'Or (NFT Gold Mine).
"It's a huge site and it's not curated, so you really have no idea what you're buying."
LooksRare, an NFT exchange that overtook OpenSea in sales volume this year, got into similar problems as its rival.
As much as 95 per cent of the transactions on its platform were found to be fake, according to CryptoSlam.
Users were selling NFTs to themselves because LooksRare was offering tokens with every transaction - no matter what you were buying.
And the amounts lost to scams this year have been eye-watering.
The owners of Axie Infinity - a game played by millions in the Philippines and elsewhere, and a key driver of the NFT market - managed to lose more than US$500 million in a single swindle.

'Like the lottery'​

Lawyer Eric Barbry told AFP: "As soon as you have a new technology, you immediately have fraudsters circling."
He pointed out that the NFT market has no dedicated regulation so law enforcement agencies are left to cobble together a response using existing frameworks.
Ms White said strong regulation could help eliminate the extreme speculation but that could, in turn, rob NFTs of their major appeal - that they can bring quick profits.
"I think less hype would be a good thing - in its current form, NFT trading is enormously risky and probably unwise for the average person," she said.
NFTs are often likened to the traditional art market because they have no inherent utility, and their prices fluctuate wildly depending on trends and hype.
But Mr Lerner suggested a different comparison.
"It's like the lottery," he said of those seeking big profits from NFTs. "You play, but you never win."

 

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Some young investors get burnt by cryptocurrency crash, regret recklessness; experts raise depression fears​

Kanchanara/UnsplashSome investors were aware of the risks involved in cryptocurrencies and were sceptical when they entered the market, but others had a larger risk appetite or believed that it was "risk-free".

• An investor in Singapore lost about S$40,000 in days, about 90 per cent of his total investment and a third of his savings
• The crash of stablecoin Luna led to concerns about suicide ideation and reckless behaviour
• One enraged investor in South Korea tried to break into the home of a businessman involved in the technology behind the cryptocurrency
• Holding funds in a related token, TerraUSD, was particularly popular among some Singaporeans
• Some platforms were offering an interest rate of about 20 per cent a year for deposits of TerraUSD

BY DARYL CHOO

BY KIMBERLY LIM
Published May 17, 2022

SINGAPORE — He was having his breakfast when he looked at the cryptocurrency exchange application on his device and saw to his shock that the price of the Luna tokens he had bought at US$5.28 (S$7.35) was spiralling downwards last Thursday morning (May 12). In early May, the tokens were trading above US$85 apiece.
Confused, the man, who wanted to be known only as Mr Low, immediately sent a message to his friends who had invested in Terra, a related cryptocurrency, hoping to find out what was happening.
He said: "A few friends told me that it will re-peg (to the US dollar) and Luna will stabilise, so I just held (on to it)."
Mr Low, who is in his late 20s, recently lost his job as a business associate at a consumer health company due to company cutbacks. He said that he had lost close to S$40,000 in a matter of days. This was 90 per cent of his total investment and a third of his savings.
He said: "Initially, there was a lot of confusion. I was not aware, unlike now, of why the market was reacting that way and why TerraUSD had de-pegged (from the US dollar) and Luna was spiralling. There was some blind hope that it would re-peg, so I just kept holding and not selling."

Over the past week, the cryptocurrency market went into a full meltdown after investors were spooked by the collapse of TerraUSD, or UST, one of the world’s largest so-called stablecoins.
Stablecoins are digital tokens pegged to the value of traditional assets such as the US dollar. Often promoted as a stable means of exchange, these coins are often used by traders to move funds around when speculating on other cryptocurrencies.
Last Tuesday, TerraUSD broke its 1:1 peg to the US dollar and fell as low as 75 US cents, based on figures from price site CoinGecko. Its price is now hovering around just nine US cents.
Unlike other stablecoins that have reserves in traditional assets, TerraUSD maintains its peg through a complex algorithm that involves the use of another cryptocurrency token, Luna.
Luna, once ranked among the top 10 most valuable cryptocurrencies, has since plunged to virtually zero from an all-time high of US$119.18 set on April 5 this year.
Luna and TerraUSD are tokens that run on the Terra network, a blockchain-based project developed by start-up Terraform Labs, which is based in Singapore.

The crash led to concerns about suicide ideation and reckless behaviour, with one enraged investor, who had reportedly lost US$2.3 million in the crash, trying to break into the home of Terraform Labs’ co-founder and chief executive officer Do Kwon on Monday in the South Korean capital of Seoul.
In a series of tweets last Saturday, Mr Do wrote on Twitter that he was “heartbroken about the pain” caused by the crash, adding that he had not profited from this incident and had not sold any TerraUSD tokens during the crisis.
The stability of such cryptocoins was once the cornerstone of the crypto ecosystem, with the United States Federal Reserve estimating a collective market value of all stablecoins at US$180 billion in March this year.

“
Mentally, I am okay. My faith reminds me that life is bigger than a financial portfolio, and though I was irresponsible in risk management, I would accept the mistake and move on and not harp on it.
A cryptocurrency investor in Singapore who lost about S$40,000 investing in Luna tokens
”

TODAY spoke to seven Singaporeans, aged in their 20s and 30s, whose investments in TerraUSD and Luna, ranging from S$1,500 to S$6,000, took a tumble last week.
Although some were aware of the risks involved in cryptocurrencies and were sceptical when they entered the market, others had a larger risk appetite or believed that it was "risk-free".
Holding funds in TerraUSD was particularly popular among some Singaporeans, as some platforms that allow users to deposit and borrow cryptocurrencies were offering an interest rate of about 20 per cent a year to people who deposit TerraUSD with them.

And these holdings were “risk-free” because the TerraUSD tokens are pegged to the US dollar and would not lose their value — or so the investors thought.
Mr Low said that he had friends who were invested in the Terra ecosystem.
"At the time, this meant you unlocked a savings rate that beat the Singapore banks by 400 times on an annual basis. And that it was 'risk free', so many people jumped onto the boat. They are coping just fine as a majority of their losses are purely paper profits," he added.
Another investor, 37, who wanted to be known only as Ashton and who works as a technician, said that he lost about S$6,000 from the crash, but his portfolio was still mainly in other coins such as bitcoin and ether.

DEPRESSIVE AND SUICIDAL THOUGHTS​

However, many others saw their life savings wiped clean over the span of two days, prompting some of them to have suicidal thoughts. There were personal finance writers who have raised concerns about suicide ideation following the crash of Luna.
At least one member of a Telegram chat group centred around the Singapore-based Chain Debrief cryptocurrency online publication has spoken about attempting suicide, which has been a “cause for concern” for Mr Jacky Yap, the publication’s founder.

Mr Yap told TODAY in an interview last Friday: “We remind everyone to not do anything foolish, and if anyone needs to talk to someone, they can always reach out to us. We also remind everyone that we all have earning power and that whatever is lost can always be earned back.”
Indeed, this is a trend happening in other parts of the world, with moderators of the Reddit threads on Terra and Luna pinning a post with suicide hotline numbers, over concerns voiced in the thread.
The Woke Salaryman, a page on personal finance, with more than 316,000 followers on Instagram and almost the same number of likes on Facebook, posted a series of graphics on Tuesday reassuring people who had lost money in the crash.
The graphics were captioned: “We typically don't like to post three times a week. But this is important”.
The post on Facebook had more than 10,000 shares and 8,900 reactions five days after it was posted. The co-founders behind the page also received several direct messages on social media platforms, with fellow investors airing their grievances.
Speaking to TODAY in a Zoom interview last Friday, Woke Salaryman co-founder He Ruiming said: “Quite a few people sent direct messages to us. We are in quite a few crypto groups as well, so I see quite a number of people talking about being depressed, saying that everything is hopeless now. So we thought it would be important to put out a message.

“People came to confide (in me) because they knew I invested as well. They asked me, ‘What should I do?’ By the time the news came out, there was already very little people could do.”

LESSONS FROM THE CRASH​

Some investors were “mentally prepared” for the crash, while others were looking for ways to move on from the episode.
Mr Low said: “Mentally, I am okay. My faith reminds me that life is bigger than a financial portfolio, and though I was irresponsible in risk management, I would accept the mistake and move on and not harp on it.”
Personal finance writers and bloggers are urging young investors to try to find ways to recover from the crash.
Mr Timothy Ho, managing editor and co-founder of investing website Dollars and Sense, said: “If you are young, it’s not the end of the world. Maybe you lost money that could have paid for one to two holidays to Europe that you didn’t get to go due to the pandemic, or the down payment to a car. It’s okay to move on.”
Many emphasised the importance of having a diversified portfolio, which should be a key takeaway from the crash.

“Having a diversified portfolio is vital because if you lose a huge chunk of your portfolio at once, it’s hard to recover. A diversified portfolio may not give us the highest possible returns, but will protect us in bad times like this,” Mr Ho from Dollars and Sense website said.

​

 

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Fools and money. They are never meant to be together.

 

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Retail investors should steer clear of crypto even as S'pore addresses risks without stifling innovation: DPM Heng​

DPM Heng warned investors about cryptocurrencies even as Singapore adapts its rules to addresses the key risks that such assets pose. PHOTO: REUTERS

Rei Kurohi
Tech Correspondent

May 31, 2022

SINGAPORE - Crypto assets like cryptocurrencies and non-fungible tokens (NFTs) are constantly evolving and highly risky but have the potential to transform the future of finance, Deputy Prime Minister Heng Swee Keat said on Tuesday (May 31).
He warned that retail investors should steer clear of cryptocurrencies even as Singapore adapts its rules to address the key risks that crypto assets pose.
"Retail investors especially should steer clear of cryptocurrencies. We cannot emphasise this enough," he said.
Mr Heng was speaking at the opening of the second Asia Tech x Singapore Summit at The Ritz-Carlton Millenia Singapore hotel in Marina Bay, organised by the Infocomm Media Development Authority.
He noted that crypto assets have gathered much interest due to their phenomenal growth and promises of high returns and, more recently, the crash of Terra Luna, which caused many investors to suffer heavy losses and triggered knock-on effects on Bitcoin and other cryptocurrencies.
Nevertheless, Singapore will continue to adapt its rules to ensure that regulation remains facilitative of innovation, the minister said.
Mr Heng, who is also Coordinating Minister for Economic Policies, said crypto assets are part of a new wave of emerging digital technologies known loosely as Web 3.0 and the way to approach this is to keep an open mind.

"We must pierce through both the hubris and the veil of suspicion to understand the potentially transformative underlying technologies," he said. "Let us not throw out the baby with the bathwater."
This is because the digital asset ecosystem comprises an entire range of services beyond cryptocurrency trading.
"We remain keen to work with blockchain and digital asset players to encourage innovation, and build up trust in the sector," he added.
In the last two years, the Monetary Authority of Singapore (MAS) has granted licences and in-principle approvals to 11 digital payment token service providers, including stablecoin players like Paxos, crypto exchanges like Coinhako and traditional financial institutions like DBS Vickers.
At the same time, MAS has consistently warned the public against trading in cryptocurrencies and took steps to limit promotion of cryptocurrencies to the general public earlier this year.

DPM Heng Swee Keat speaking at the opening of the second Asia Tech x Singapore summit on May 31, 2022. ST PHOTO: ALPHONSUS CHERN
"We will continue to evaluate applications, and facilitate live experiments through regulatory sandboxes, to enable safe adoption in the financial sector," said Mr Heng.
He also announced the launch of Project Guardian, a collaborative effort by MAS to partner the industry to explore the tokenisation of financial assets and develop the future of finance infrastructure.
The first industry pilot will be to explore potential decentralised finance applications in wholesale funding markets.
Said Mr Heng: "In short, we must approach emerging tech with an open mind, separating the hubris from its true underlying potential.
"Through regulation, we work constructively to realise the gains of these new technologies, and partner responsible and innovative players with strong risk management capabilities to build the foundations of the digital asset ecosystem."

 

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Big investors exited Terra as collapse began while small ones bought: Report​

Until now, the firm has largely remained silent about Terra's demise. PHOTO: REUTERS

Jun 3, 2022

NEW YORK (BLOOMBERG) - Jump Crypto, a firm heavily involved in the defunct Terra blockchain, said some large investors exited Terra-related positions as the TerraUSD (UST) stablecoin began to lose its peg, while small investors continued buying during the collapse.
That detail was part of a report on Terra's meltdown in early May that Jump Crypto, the crypto unit of Chicago-based Jump Trading, published on Thursday (June 2).
Until now, the firm has largely remained silent about Terra's demise - including how Terra's backer, Luna Foundation Guard, allocates its remaining funds to compensate users of UST, or steps the firm took in a failed effort restore the coin's one-to-one peg to the United States dollar.
While Jump Crypto's president, Mr Kanav Kariya, is listed on the foundation's website as a member of its governing council, the report does not discuss his firm's role in the stablecoin drama.
But the findings - based on publicly available blockchain transactions, excluding internal data at Jump Crypto - indicate that several large investors exited their position in UST much earlier than many smaller ones, another example of how cryptocurrency remains a game for large professional players.
UST, a stablecoin that ran on the Terra blockchain (now Terra Classic), was designed to maintain its dollar peg through both algorithms and trading incentives involving another token, Luna.
The growth of Terra exploded over the past two years among both large and mom-and-pop investors, thanks to its quasi-bank, Anchor, which promised 20 per cent interest rates for depositors of UST at some point.

But a chain of events triggered a "death spiral" that sent both UST's and Luna's prices down to virtual zero, shocking the crypto market and raising questions about its viability. The crash triggered a broader shock and billions of dollars vanished in just a few days.
Jump Crypto acknowledged findings in an earlier report by Nansen, a blockchain analytics platform, that a handful of wallets including one associated with crypto lender Celsius were "critical" as the dollar peg slipped, leading to an unraveling of the entire blockchain.
The Jump Crypto report, written by researchers Nihar Shah and Maher Latif, pointed out that while some large depositors of UST got out of Anchor as early as May 7, some small depositors increased their exposure between May 7 and May 9. The outflows of UST from Anchor played a key role in stripping UST away from its peg further, according to Jump.
Large depositors were able to run down almost 15 per cent of their UST position in Anchor almost immediately when the dollar-peg slip first took place on May 6, while small depositors, or wallets with less than US$10,000 (S$13,700) in Anchor as at May 6, increased their exposure.
"However, their total position size was an order of magnitude smaller than that of mid-sized and large depositors, and so this increased exposure was insufficient to counteract the outflows," the report concluded.
Jump Crypto considers it unlikely that the wallet that helped touch off the meltdown was associated with a professional trading entity, based on analysis of the wallet's history.
On May 7, the mysterious wallet reduced its UST position through a series of transactions by about US$85 million, a move that the crypto market has concluded was the first in a series of events that triggered the larger disaster.
Citadel Securities and BlackRock said in May that they had nothing to do with Terra's downfall, after many on social media started speculating who was responsible of the event.

 

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Beware of crypto pump-and-dump scams​

The crypto economy has been torn to shreds in recent weeks with hundreds of billions knocked off the value of the sector. PHOTO: REUTERS


JUN 5, 2022

(AFP) - In a sleepy corner of the crypto economy, the value of an obscure coin called Enzyme was tumbling downwards along with its peers but something unusual happened mid-May.
Enzyme, also known as MLN, rocketed from 30 US cents to 47 US cents in just minutes and daily trading volumes exploded from around US$3 million (S$4.1 million) to more than US$100 million, according to CoinGecko.
A few hours later, it crashed back down to 35 US cents.
The coin had just been "pumped and dumped", an age-old scam when traders get together and orchestrate a price hike to bag a quick profit.
"In the stock market, pump and dump is illegal, which is why criminals take advantage of the less robust regulatory framework around crypto assets," said Mr Mircea Mihaescu of compliance outfit Coinfirm.
The crypto economy has been torn to shreds in recent weeks with hundreds of billions knocked off the value of the sector and some currencies completely collapsing.
The scamming industry - worth some US$7.8 billion last year according to Chainalysis data - has not given up though.

Scammers continue to find fertile ground on the Telegram app and Twitter, positioning themselves as benevolent heroes helping those who have lost out in the crash.
The rationale preys on the cult-like nature of crypto investing, but experts say it is far from the truth.
It all started when messages from users with pseudonyms started going in social media channels, claiming that "whales", or rich investors, were starting to accumulate MLN coin.

One of them was ironically named "WallStreetBets - Pumps".
Everyone who saw the Telegram messages or the hype on Twitter knew their only chance to make a profit was to get in and out fast. In reality, almost all of them would have lost. The price spike lasted for just minutes and the only ones guaranteed success were those organising the scam.
"In any pump-and-dump scheme, everyone is convinced they are the pumper," said behavioural economist Stuart Mills from the London School of Economics.
This is far from being the only saga involving groups that openly pump coins on Telegram.

Kucoin Crypto Pumps Trading, for example, is already advertising a pump timed for next week. Monaco Pump Group claims to be run by "two of the richest whales in Monaco".
Data scientist Matt Ranger reckons most of these schemes are run by groups of low-level career scammers with one main skill - marketing.
"You don't have to know how to write a line of code," he said of the pump-and-dump schemes.
The Telegram groups churn out messages that tap into the sense of grievance at the heart of the crypto economy - the feeling that mainstream economic institutions have failed young people.
"This signal was meant for everyone to recover from the recent Luna events," the WallStreetBets group said, referring to the failure of a major crypto project called Terra/Luna. And the group thanked "mega whales" for helping to pump up the value.
The insular world of crypto creates its own fictions, where billionaires sacrifice themselves for the good of the community.
It goes hand-in-glove with currently popular conspiracy theories that the crash in the crypto economy was engineered by investment firms like BlackRock or Citadel. These companies, the theory goes, deliberately crashed Bitcoin so they could buy into the space at a lower price.
Mr Stuart Mills points out that this helps the pump-and-dump groups to dehumanise their victims and boost their own sense of grievance.
"All of a sudden these unethical means become more justified," he said. "I was screwed, so time to screw the bad guys over."
However, Mr Ranger points out that during slumps like the current one, such scams quickly become unsustainable.
"The only buy orders are the people on that Telegram group or on Twitter," he said. "As soon as you hit the last one, it collapses, because there's nothing else, there's no organic real demand."

 

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Bored Ape NFTs face steep declines in broad crypto asset rout​

The Bored Ape Yacht Club NFTs saw a 25 per cent decrease in average price in the past 24 hours. PHOTO: REUTERS


JUN 14, 2022

NEW YORK (BLOOMBERG) - Popular collections of non-fungible tokens (NFTs), including the celebrity-favoured Bored Ape Yacht Club (BAYC), are being hit hard as the crypto market sinks.
The NFT Index, which tracks the performance of NFTs and is weighted based on each token's circulating supply, fell about 23 per cent in the past 24 hours. The BAYC NFTs saw a 25 per cent decrease in average price in the same period, according to data from DappRadar and CoinMarketCap. Some of these tokens had sold for millions of dollars in recent months.
The price drops are part of a broader crypto sell-off occurring in part because of the surprise inflation readings that hit a 40-year high last Friday (June 10). Bitcoin fell as much as 15.5 per cent, reaching an 18-month low and down more than 50 per cent from its all-time record in November.
Bitcoin was trading at around US$23,523 (S$32,750) just after the stock market closed in New York.
The NFT market had been a bright spot relative to the rest of assets in the crypto space during the market rout. Investors have built substantial portfolios of NFTs in the past six months despite their low liquidity compared with fungible tokens like Bitcoin and Ether.

 

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Bitcoin tumbles amid crypto contagion fears after Celsius Network freezes withdrawals​

The Celsius move triggered a slide across cryptocurrencies, with their value dropping below US$1 trillion, on June 13, 2022. PHOTO: REUTERS

June 14, 2022


SINGAPORE (BLOOMBERG, REUTERS) - Bitcoin extended declines on Tuesday (June 14) as investor sentiment took another leg down over fears that bigger Federal Reserve interest rate hikes loom to quell inflation.
Also triggering worries was the move by major US cryptocurrency-lending company Celsius Network on Monday to freeze withdrawals and transfers, citing "extreme" market conditions, another sign of the financial market downturn hitting the cryptosphere.
The Celsius move triggered a slide across cryptocurrencies, with their value dropping below US$1 trillion (S$1.39 trillion) on Monday for the first time since January 2021, sparking worries the rout might spill over to other assets or hit other companies.
"Almost anything can be systemic in crypto... because the whole space is over-levered," said Mr Cory Klippsten, chief executive of Swan Bitcoin, a Bitcoin savings platform. "It is all a house of cards."
Celsius CEO Alex Mashinsky and Celsius did not respond to Reuters' requests for comment.
New Jersey-based Celsius, which has around US$11.8 billion in assets, offers interest-bearing products to customers who deposit cryptocurrencies with its platform. It then lends out cryptocurrencies to earn a return.
Bitcoin, the world's largest digital token, shed as much as 10.3 per cent to reach US$20,824, the lowest level since December 2020. It fell as much as 15 per cent on Monday after the Celsius announcement.

A range of other tokens from Ether to Avalanche were also nursing losses.
"Sentiment for cryptos is terrible as the global crypto market cap has fallen below US$1 trillion dollars," said Mr Edward Moya, senior market analyst for the Americas at Oanda. He added that a Bitcoin drop below the US$20,000 level could lead to "even uglier" price action.
Cryptocurrencies have become emblematic of a flight from speculative investments as monetary policy is tightened around the world to fight price pressures, draining liquidity from global markets.

Crypto lender Celsius freezing withdrawals on Monday exacerbated worries about the stress in the digital-asset sector, which was already on tenterhooks after the collapse of the Terra/Luna ecosystem.
Traders are also monitoring MicroStrategy, whose big bet on Bitcoin is backfiring. Among the issues weighing on the company is the threat that an even deeper drop in the token's price will require it to post additional collateral for loans.
Companies exposed to cryptocurrencies have previously warned that declines in token prices could have ripple effects, including by triggering margin calls.
Markets extended a sell-off on Monday after United States inflation data last Friday that showed the largest price increase since 1981, prompting investors to raise their bets on Fed rate hikes.
That was likely the key driver of the crypto market nosedive, Mr Jay Hatfield, chief investment officer at Infrastructure Capital Management, wrote in a note on Monday.
"The Fed's overexpansion of its balance sheet led to a number of bubbles, including tech stocks (and) crypto tokens," he said.

Cryptocurrency investors have also been rattled by the collapse of the TerraUSD and Luna tokens in May, which was shortly followed by Tether, the world's largest stablecoin, briefly breaking its one-to-one peg with the US dollar.
In a blog post on Monday, Tether said that while it has invested in Celsius, its lending activity with the crypto platform has "always been overcollateralised" and has no impact on Tether's reserves. The token was last trading flat at US$1.
Also on Monday, BlockFi, another crypto-lending platform, said it was reducing its headcount by about 20 per cent due to a "dramatic shift in macroeconomic conditions". BlockFi said that it has no exposure to Celsius.
Bitcoin, which surged in 2020 and 2021, is down more than 50 per cent so far this year. Ethereum is down over 67 per cent in 2022.

Crypto lending​

Celsius says on its website that customers who transfer their crypto to its platform can earn an annual return of up to 18.6 per cent. In a blog post on Sunday evening, the company said it had frozen withdrawals, as well as transfers between accounts, "to stabilise liquidity and operations while we take steps to preserve and protect assets".
"We are taking this action today to put Celsius in a better position to honour, over time, its withdrawal obligations," the company said.
Celsius' token has fallen about 97 per cent in the last 12 months, from US$7 to around 20 US cents, based on CoinGecko data.

'Grey area'​

Crypto-lending products have surged in popularity and many companies have launched offerings within the last year.
This has sparked concerns among regulators who are worried about investor protection and systemic risks from unregulated lending products.
Celsius and crypto firms that offer similar services operate in a regulatory "grey area", said Mr Matthew Nyman at CMS law firm.
Celsius raised US$750 million in funding last year from investors, including Canada's second-largest pension fund Caisse de Depot et Placement du Quebec. Celsius was valued at the time at US$3.25 billion.
As at May 17, Celsius had US$11.8 billion in assets, its website said, down by more than half from October, and had processed a total of US$8.2 billion worth of loans.
Mr Mashinsky, the CEO, was quoted in October last year saying that Celsius had more than US$25 billion in assets.
Rival crypto lender Nexo said on Monday it had offered to buy Celsius' outstanding assets.
"We reached out to Celsius on Sunday morning to discuss the acquisition of its collateralised loan portfolio. So far, Celsius has chosen not to engage," said Nexo co-founder Antoni Trenchev.
Celsius did not respond to a request for comment on Nexo's offer.

 

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Bill Gates blasts crypto, NFTs as based on 'greater fool' theory​

Bill Gates described digital banking as "hundreds of times more efficient" than cryptocurrencies. PHOTO: AFP

June 15, 2022

SAN FRANCISCO (BLOOMBERG) - Billionaire Bill Gates dismissed cryptocurrency projects such as nonfungible tokens (NFTs) as shams "based on the greater fool theory" at a climate conference on Tuesday (June 14), reviving past criticisms of digital assets.
The greater fool theory argues that prices go up because people are able to sell an overpriced item to a "greater fool", whether or not it is overvalued. That is, of course, until there are no greater fools left.
"Obviously, expensive digital images of monkeys are going to improve the world immensely," Mr Gates said sarcastically while speaking at an event in Berkeley, California, hosted by TechCrunch. He said he is neither long nor short the asset class.
Mr Gates has criticised crypto before, sparring with Tesla's Elon Musk last year over whether Bitcoin is too risky for retail investors and the environmental harm of mining coins. Speaking on Tuesday as the founder of Breakthrough Energy Ventures, the climate-focused fund he began in 2015, Mr Gates noted the difficulty of recruiting Silicon Valley engineers to work in industries like chemicals and steel production in need of lower greenhouse gas emissions.
Bitcoin plunged more than 15 per cent on Monday and another 5.4 per cent on Tuesday, part of a broader crypto sell-off fueled by higher than forecast US inflation and the halt of withdrawals by the lending platform Celsius. Popular NFT collections, including the celebrity-favoured Bored Ape Yacht Club, are also being hit hard.
Mr Gates also defended digital banking efforts he has supported through his philanthropic foundations, which he described as "hundreds of times more efficient" than cryptocurrencies.

 

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Singapore-based crypto hedge fund's cryptic tweet fuels speculation over losses​

Recent attention on Three Arrows has centered around its exposure to a cryptocurrency called staked Ether, or stETH. PHOTO: REUTERS

June 15, 2022

NEW YORK (BLOOMBERG) - Speculation about the financial health of cryptocurrency hedge fund Three Arrows Capital intensified on Wednesday (June 15) after a tweet from co-founder Zhu Su hinted at potential stress amid a deep sell-off in digital assets.
"We are in the process of communicating with relevant parties and fully committed to working this out," the former Credit Suisse Group trader tweeted from his verified account, without providing further details. Mr Zhu and Three Arrows co-founder Kyle Davies did not respond to requests for comment.
While information on the fund's size and trading strategies is sparse, blockchain analytics firm Nansen estimated in early March that Singapore-based Three Arrows managed about US$10 billion (S$13.9 billion). It owned more than 5 per cent of the Grayscale Bitcoin Trust as at December 2020, according to the latest available regulatory filings, though it is unclear whether Three Arrows has maintained that position. The trust has a market value of about US$10 billion.
Recent attention on Three Arrows has centred around its exposure to a cryptocurrency called staked Ether, or stETH.
The fund started withdrawing stETH from decentralised platforms last month, according to Nansen. As recently as Tuesday morning, it withdrew more than 80,000 stETH from decentralised lending project Aave in four transactions and then swapped 38,900 of the stETH for 36,700 Ether.
The trade may have resulted in a "big haircut", said Nansen content lead Andrew Thurman. The stETH token is supposed to be redeemable for one Ether coin, after a planned upgrade to the Ethereum network takes effect.
The price of stETH has tumbled 35 per cent in the past seven days to US$1,137.38, while Ether has declined 34 per cent to US$1,193.98, according to CoinGecko.

The total market value of cryptocurrencies tracked by CoinGecko has plunged to US$984 billion from US$3 trillion in November. Losses accelerated in recent weeks amid concerns about United States Federal Reserve rate increases, the collapse of the Terra blockchain and a crisis at crypto lender Celsius Network.

 

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Bitcoin rout hits ‘darkest’ phase with entire market underwater​

Bitcoin clawed its way to US$20,816 on June 15, 2022. PHOTO: REUTERS
UPDATED

JUN 15, 2022

NEW YORK (BLOOMBERG, REUTERS) - The bear market for Bitcoin has entered its “deepest and darkest” phase, with even long-term holders who had toughed it out until now coming under extreme pressure.
That’s according to strategists at Glassnode, which tracks an indicator known as realised price, the average purchase price of all Bitcoins in circulation. The cryptocurrency is currently trading roughly US$1,000 below the coin’s current realized price of US$23,430, according to the firm.
Bitcoin dropped as much as 5.2 per cent to US$20,833 early Wednesday (June 15) in London.
“The current bear market is now entering a phase aligned with the deepest and darkest phases of previous bears,” the strategists wrote in a note. “The market, on average, is barely above its cost basis, and even long-term holders are now being purged from the holder base.”
Market watchers have become preoccupied with figuring out which cohorts of investors are getting hurt the most during the current crypto winter. With Bitcoin now hovering around December 2020 lows, many newer entrants are now underwater.
Meanwhile, UBS strategists are monitoring Bitcoin miners - whose businesses have been under pressure due to high energy costs and capex commitments - for potential signs of capitulation, which could also have an impact on prices.
Bitcoin’s slump is already having ramifications for other companies exposed to the crypto market.

On Tuesday, cryptocurrency exchange Coinbase Global said it would slash 18 per cent of its workforce, or about 1,100 jobs, as part of efforts to rein in costs amid volatile market conditions. Crypto lending platform BlockFi said on Monday it would lower headcount by about 20 per cent, while Singapore-based crypto exchange Crypto.com said last Friday it would axe about 260 employees or 5 per cent of its workforce.
Digital-asset investors have been partially spooked by crypto lender Celsius Network pausing withdrawals, swaps and transfers, though the broader market remains under duress after a key inflation print came in hotter than expected last week, meaning that the Federal Reserve will have to be aggressive in its attempts to cool rising prices.
Lori Calvasina, head of US Equity Strategy at RBC Markets, said she’d like to see Bitcoin stabilize. “It has become another helpful indicator of sentiment and risk assets generally,” she said on a podcast.

Meanwhile, Glassnode strategists said that a change in the net position of HODLers - the staunchest investors who refuse to sell - can be used to estimate the magnitude of coin volume they’re accumulating or distributing. That reading suggests that approximately 15,000-20,000 Bitcoins per month are transitioning into the hands of HODLers, a decline of 64 per cent since early May, an indication of weakening accumulation.
Bitcoin has fallen more than 30 per cent this month. Its decline Wednesday marks its ninth straight day of losses, with the rate of change over the past three days at 24 per cent - the starkest drop in its history.
“Bitcoin trades like a penny stock,” Brian Nick, chief investment strategist at Nuveen, said in an interview. “There’s all kinds of reason to think that once it starts falling quickly, it can continue to fall. If it can move 20 per cent in two days, it can move another 20 per cent the next two days.

'Panic'​

Celsius, which had around US$11.8 billion in assets, offers interest-bearing products to customers who deposit crypto at its platform. It then lends out coins to earn a return.
"The market is now panicking about the impact and contagion if Celsius becomes insolvent," wrote Singapore fund manager QCP Capital in a note.
Crypto investors were already rattled by the collapse of the TerraUSD and Luna tokens in May which were shortly followed by Tether, the world's largest stablecoin, briefly breaking its 1:1 peg with the dollar.
Celsius's move to suspend withdrawals has raised fresh questions about regulatory oversight of such crypto-lending platforms.
On Tuesday, US Securities and Exchange Commission chair Gary Gensler told an event that such platforms were operating akin to banks, and questioned how they could offer such large returns.
"I caution the public. If it seems too good to be true, it just may well be," he added.

 

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Crypto crash: What's causing the rout in cryptocurrencies?​

After the crash of the Terra/Luna stablecoin, the value of the entire digital coin market has fallen below US$1 trillion. PHOTO: AFP

Kang Wan Chern
Assistant Business Editor

JUN 15, 2022

SINGAPORE - The cryptocurrency bloodbath has continued this week with Bitcoin at levels not seen since late 2020 while the value of the entire digital coin market has fallen below US$1 trillion (S$1.4 trillion) for the first time since January 2021.
The rout comes after the crash of the Terra USD/Luna stablecoin project last month, which resulted in a significant loss in confidence in the crypto ecosystem.
Take Bitcoin. It was flying high at US$69,000 in November 2021 but now hovers just above US$20,000. On Monday alone, Bitcoin tumbled by around 17 per cent.
Here's why crypto prices are still falling:

What caused the latest rout?​

This week's sell-off in crypto was triggered after Celsius Network, a major United States cryptocurrency lending company, froze withdrawals and transfers on Monday, citing "extreme" market conditions.
Celsius is one of the largest lenders of crypto, with around US$11.8 billion in assets, according to Bloomberg.
It offers users higher-than-average interest rates on their crypto deposits and then lends out the coins to earn a return.


This has led to panic about the potential impact on the broader crypto market.
"If people won't be able to withdraw their cash when they want to, or when they need to, and especially when the market is falling sharply, it could trigger a bank run on cryptocurrency firms," Ms Ipek Ozkardeskaya, senior analyst at Swissquote Bank noted.
Additionally, crypto lenders are unregulated so there are few rules on the capital they must hold, or transparency over their reserves, which would have taken a hit from the recent volatility.

What should crypto investors watch out for next?​

Volatility will likely come from the global economic situation.
Crypto prices have been volatile since the start of the year, pummelled by central banks raising interest rates to tackle soaring inflation.
This has raised fears that the banks will need to act even more aggressively and drive investors away from risky assets like cryptos, wrote Mr Sipho Arntzen, an analyst from private bank Julius Baer.
All eyes will be on the US Federal Reserve's two-day meeting this week, with the bank widely expected to announce further rate hikes at the gathering or in the months ahead.
The market is anticipating a 75-basis point rise in one of the next three meetings this year, so any level above or below this could to lead to short-term spikes or slides in crypto prices.

Is it the end of the line for crypto?​

No, but there will be more pain ahead.
The financial health of Singapore-registered cryptocurrency hedge fund Three Arrows Capital has already come under scrutiny due to its exposure to a cryptocurrency called staked Ether (stETH).
Celsius is also exposed to stETH. According to Bloomberg, one Celsius wallet identified by blockchain analytics platform Nansen showed that it holds more than US$400 million in stETH.
The price of stETH has tumbled 35 per cent in the past seven days to US$1,137.38, while Ether has declined 34 per cent to US$1,193.98, according to CoinGecko.
Ms Ozkardeskaya noted that the market fallout from Terra Luna's collapse, Celsius' decision to halt activity on its accounts and layoffs by prominent crypto firms like Coinbase signal that the industry may not be ready for further contagion.
But Mr Arntzen said that while crypto will take time to stabilise, "there remains long-term potential in the asset class due to the disruptive potential of the underlying blockchain technology".

 

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Babel Finance suspends withdrawals as crypto markets slump​

Cryptocurrency valuations have plunged in recent weeks as investors dump risky assets in a rising rate environment. PHOTO: REUTERS

JUN 17, 2022

BENGALURU (REUTERS) - Hong Kong-based Babel Finance temporarily suspended the withdrawals and redemption of crypto assets on Friday (June 17), as the crypto lender scrambles to pay its clients after the recent slump in the digital currency market.
Cryptocurrency valuations have plunged in recent weeks as investors dump risky assets in a rising rate environment, with Bitcoin, which reached a record high of US$69,000 (S$96,000) in November, having lost more than half its value this year.
"Recently, the crypto market has seen major fluctuations, and some institutions in the industry have experienced conductive risk events. Due to the current situation, Babel Finance is facing unusual liquidity pressures," said the company.
Crypto lenders gather crypto deposits from retail customers and reinvest them, proclaiming double-digit returns and attracting tens of billions of dollars in assets. However, the recent meltdown has lenders unable to redeem their clients' assets.
Babel, which has 500 clients and limits itself to Bitcoin, Ethereum and stablecoins, raised US$80 million in a funding round last month, valuing it at US$2 billion. It had ended last year with US$3 billion of loan balances on its balance sheet.
Earlier this week, United States-based retail crypto lending platform Celsius Network froze withdrawals and transfers between accounts "to stabilise liquidity" as the collapse of cryptocurrency TerraUSD in May triggered a rise in redemptions.

 

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Bitcoin drops below US$20,000 to lowest since December 2020​

Bitcoin is down about 59 per cent this year.

June 18, 2022

SAN FRANCISCO (REUTERS) - Bitcoin dropped below US$20,000 (S$27,900) on Saturday (June 18) to its lowest level in 18 months, extending its slide as investors pull back from riskier assets amid rising interest rates.
The biggest cryptocurrency was down 7.1 per cent to US$18,993 at 5.06pm Singapore time, having earlier touched US$18,732, its lowest since December 2020.
It is down about 59 per cent this year, while rival cryptocurrency Ether, which is backed by Ethereum, is down 73 per cent.
The digital currency sector has been pummelled this week after cryptocurrency lending company Celsius Network froze withdrawals and transfers between accounts.
The sector has also suffered losses after companies such as Coinbase Global, Gemini and Blockfi said they would lay off thousands of employees as investors ditch risky assets.

 

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Elon musk how!

 

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Singapore regulator MAS vows to be 'unrelentingly hard' on crypto​

Singapore has approved few applications for a licence to operate a crypto business. PHOTO: ST FILE


JUN 23, 2022

SINGAPORE (FINANCIAL TIMES) - Singapore will be "brutal and unrelentingly hard" on bad behaviour in the crypto industry, according to its fintech policy chief, marking a stark shift in rhetoric after years of the city state courting the sector.
Mr Sopnendu Mohanty, chief fintech officer at the Monetary Authority of Singapore (MAS), the country's central bank, questioned the value of private cryptocurrencies and said he expected a state-backed alternative to be launched within three years.
"We have been called out by many cryptocurrencies for not being friendly," he told the Financial Times in an interview. "My response has been: Friendly for what? Friendly for a real economy or friendly for some unreal economy?"
Mr Mohanty added: "We have no tolerance for any market bad behaviour. If somebody has done a bad thing, we are brutal and unrelentingly hard."
The crypto meltdown has hardened the stance of officials in Singapore, where many crypto businesses had been set up because of the perceived friendly regulatory environment and low taxes.
But crypto exchanges, including Bybit and Binance, have shunned Singapore in recent months as MAS started rolling out increasingly restrictive rules.
Mr Mohanty was speaking as South Korean prosecutors narrowed in on Singapore-based Terraform Labs, the company behind the collapsed stablecoin TerraUSD and its twin token Luna.

In the aftermath of Luna's US$40 billion (S$55.5 billion) wipeout, crypto hedge fund Three Arrows Capital, headquartered in Singapore, was also plunged into a crisis after failing to meet margin calls.
"I think the world at large is lost... in private currency, which is causing all this market turmoil," said Mr Mohanty.
He said Singapore has enforced a "painfully slow" and "extremely draconian due diligence process" for licensing crypto businesses.
Singapore has approved few applications for a licence to operate a crypto business.
Crypto.com, a cryptocurrency trading platform, on Wednesday received in-principle approval to operate. Crypto.com has also received a licence in Dubai and plans to launch a cryptocurrency exchange service there.
But Mr Mohanty's comments suggested that some crypto businesses may face an uncertain future in Singapore.
This week, MAS co-launched a "centre of excellence" in the city state to work on the development of a central bank digital currency, a concept that several countries are exploring to potentially wrest control of online payments from crypto businesses.

Led by software developer Mojaloop and backed by Singapore's investment company Temasek, the group hopes to implement the digital currency in a system that enables low-cost international payments.
Mr Mohanty said his "best bet" was that a digital currency would be integrated into the platform within "a few years", adding that it would not be exclusive to Singapore and would be available to other central banks.
"We are relentlessly focused on the infrastructure of the future economy, which can be based on a digital asset," he said.