Bitcoin Jesus could be at the heart of Crypto's latest scandal.
Welcome to The Daily Forkast, June 29th 2022.
I'm Joel Flynn of Forkast with the latest on what's happening on the blockchain.
And at the center of it is accusations over a $47 million loan to CoinFLEX.
It is apparently owed by one of the biggest names in bitcoin.
We've got details on that.
Plus, legal action against Celsius and a whole lot more.
So let's get you up to speed from Asia to the world.
Join thousands of NFT traders who already start their day on CryptoSlam.
Well, there's been another twist in the CoinFLEX's tale.
Bitcoin Jesus Roger Ver has denied defaulting on a US$47 million loan with the exchange
tweeted overnight that rumors over the debt were apparently false.
He didn't name CoinFLEX specifically, but he did insist it was actually them who owed
him money.
Shortly after that tweet, CoinFLEX CEO Mark Lamb said there had been served with a default
notice.
He added that the two parties had had a long standing relationship, and while their accusation
was unfortunate, CoinFLEX still hoped to be able to resolve this situation.
CoinFLEX, of course, froze transactions last Friday.
It cited uncertainty over a counterparty, as well as extreme market conditions.
Neither Lamb nor Ver have so far responded to Forkast's requests for comment as of the
time of this recording.
CoinFLEX is also a sponsor of Forkast.
Meanwhile, legal action could be on the horizon for Celsius.
The troubled crypto lender froze withdrawals earlier this month and is apparently at risk
of insolvency.
Speaking exclusively to Forkast, Ben Armstrong, better known as crypto educator Bitboy Crypto
says that investors are planning to fight back.
Forkast's Carolyn Wright has the details.
According to its website, Celsius managed over US$11.8 billion in assets on May 17.
However, withdrawals and transfers were put on pause on June 13th, with the lender citing
extreme market conditions as the reason.
And now the big question is, will investors ever see their cash again?
Bitboy Crypto certainly hopes so.
Forkast's Editor in chief Angie Lau sat down with the crypto influencer and investor Ben
Armstrong, asking him if a class action lawsuit is in the cards.
What we've discovered is class action is not going to be the rout against Celsius.
I've been in talks with my lawyers.
We are...
There is an action coming on our behalf, along with some other investors.
So we're right now trying to compile a list of some other plaintiffs that have seven figures
or more locked up in Celsius.
And so they will be receiving some stuff from us probably pretty soon, but we're dead set
on this.
It's not just the big investors he's hoping to help either.
I've also been in talks with attorneys about helping the people that have lower amounts
on Celsius, ranging anywhere from a few thousand dollars to six figures.
And so I'm at that point once once I get this time straightened out, what I'm doing going
to be helping those lawyers recruit people to do some other actions that can help them
as well.
He says it's important to not stand by and let this kind of thing happen in crypto.
If you look at what happened with Terra Luna, in some ways it's a different situation because
you really got one guy behind the whole thing and it's not, you know, they're not custody,
custody being your assets.
Celsius has a much, much higher level of responsibility in this as they were cutting our assets.
And it's something that I trusted fully.
A lot of other people trust it fully.
Armstrong says investors have been left questioning whether they can really trust any third party
staking platform.
I'm Caroline Wright, Forkast.
Now, investors may have been spooked by crypto lenders freezing withdrawals, but Wall Street
seems to have spied an opportunity.
Both Goldman Sachs and Morgan Creek Digital are trying to make deals, despite critics
claims that the crypto bubble has already burst.
So why are they so keen?
Forkast's Lachlan Keller has more.
Global crypto market capitalization has plunged almost 70% from last November's record high
of just over US$3 trillion . And that set off a cascade of distress with speculation
that several high flying crypto operations are verging on insolvency.
However, big Wall Street players are moving in to take advantage of the crypto firesale.
Goldman Sachs is looking to raise US$2 billion to buy distressed assets from Celsius and
gauging interest from Web3 crypto funds to contribute.
Meanwhile, asset manager Morgan Creek is attempting to raise $250 Million to counter an offer
from crypto exchange FTX to bail out Blockfi.
One expert told Forkast:
What people are starting to see is opportunities that distressed assets will attract buyers.
Quite simply, there's blood in the water and when you've got blood in the water, the sharks
start to circle.
Sycamore says both will likely hold on to the assets until we see some recovery in the
crypto space.
And that may take some time.
I don't think we'll start to see a rebound in prices until the Fed starts to pivot and
the Fed isn't going to start to pivot for the next three or four months.
I think the fact that they are looking and scratching around suggests that they are taking
a longer term bullish view of the market.
Andrew Sullivan of Asian Markets Sense says that Goldman Sachs is not just about seizing
the opportunity buying distressed assets over.
They're already seeing a lot of their clients involved in the crypto space.
So being able to buy into an existing platform, whether it's profitable or not in the short
term doesn't really matter too much for them.
They've got enough excess capital on their balance sheet probably to make this.
They can say this is a long term investment, it's not a short term speculative play.
It's part of our it's going to be part of our core business in time.
Well, any firm moving in on distressed assets need to be mindful of the recent events like
Celsius three areas Capital and the collapse of Terra, Sullivan is optimistic about the
impact of these events could have on the industry.
There have been some great speculators out there that have been effectively going short
or or borrowing long and making some very bold bets without any real substantive backing
behind it.
I think the fact that it's happening in the crypto world now is probably a good thing
because it's it's alerted everybody to the risk that's out there that these speculative
firms will take advantage of the of the terms you offer them.
And if you don't do proper, proper controls, then you are going to lose money.
With crypto winter in full force, the industry will be watching to see what can be made of
the situation.
I'm Lachlan Keller, Forkast.
Meanwhile, the US says North Korea should face sanctions for crypto hacking.
The US Treasury Department's Brian Nelson said North Korea's hacks have helped fund
its weapons of mass destruction.
The Undersecretary for Terrorism and Financial Intelligence was visiting South Korea on Tuesday.
He told local media there that cooperation with Seoul on sanctions was being discussed.
Etherium sidechain Ronin, which Axie Infinity runs on, was hacked for over US$620 million
worth of crypto last March.
The US has said Pyongyang was behind the hack, which of course was one of the largest DeFi
heists in history.
Meanwhile, Sky Mavis Ronin Bridge is finally back online after a three month network hiatus.
The bridge is used by Axie Infinity players to transfer assets between Ronin and the Ethereum
main chain.
According to its newsletter, The Ronin Bridge has been through three orders since the hack,
and it is now increased security and a limit on suspicious withdrawals.
You can find out more about the Ronin hack as well as all of our other top stories today
at Forkast.News.
Make sure you head there.
All right.
Let's return to HTC's metaverse phone.
We mentioned it Monday.
It is now available.
The Desire 22 pro is preloaded with apps from its Viverse arm that apparently offers users
what it calls a rich metaverse experience and without a VR headset.
The Taiwanese firm said the phone allows users to create virtual avatars and manage crypto
assets on both Ethereum and on Polygon.
But it is currently only available in Taiwan, Japan and Europe.
All right.
We're just a day away from one of the biggest crypto conversations of the year.
Forkast's Crypto Rising livestream event is taking place tomorrow.
Its focus is the future of stablecoins.
Forkast's Editor in chief Angie Lau will be joined by some of Crypto's most influential
figures.
They'll be talking about a race against time that regulators are facing in the wake of
the spectacular collapse of Terra Luna.
Do not miss it.
You can sign up at Forkast.News and make sure you join us tomorrow, June 30th at 9 p.m.,
Hong Kong time, 9:00 AM Eastern.
There's also more details on all of the day's stories and more on the website.
Head to our Twitter as well for breaking news and updates on what we're talking about right
now @Forkast_News.
That is it for today's Daily Forkast, though.
I'm Joel Flynn.
I'll see you next time.