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Justin Sun’s Tron DAO Reserve To Buy $1 Billion Tether (USDT)

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Justin Sun’s Tron DAO Reserve To Buy $1 Billion Tether (USDT)

Summary:

  • Tron DAO Reserve tweeted plans to scoop up $1 billion USDT, crypto’s largest stablecoin token issued by Tether.
  • The Justin Sun-backed decentralized autonomous organization upped its USDT deployment from $300 million supposedly “To safeguard the overall blockchain industry and crypto market”.
  • Sun announced the massive buy after Tether’s token depegged following short positions opened by Alameda Research amid uncertainty surrounding FTX.

Tron DAO Reserve plans to bolster its holdings with $1 billion USDT, Tether’s stablecoin token with a $68 billion market cap at press time. The decentralized autonomous organization (DAO) which manages USDD’s reserves increased its USDT pledge by $700 million.

Per tweets posted by the Justin Sun-backed DAO, topping up its algorithmic stablecoin reserves helps “to safeguard the overall blockchain industry and crypto market”.

Prior to the Tether scoop, USDD was backed by over $200 million held in Bitcoin (BTC), $492 million in Circle’s USD Coin (USDC), and some 10 billion Tron (TRX) tokens. These numbers were pulled from Tron DAO’s USDD total collateral summary here.

Tron DAO stressed that the massive USDT buy will be held on centralized exchanges. The decision comes at a time when industry faith in so-called centralized crypto entities is low following the failures of Celsius, Three Arrows Capital, Hodlnaut, and possibly FTX to name a few.

To safeguard the overall blockchain industry and crypto market, TRON DAO Reserve will purchase total 1 billion USDT. You may see the change of balance on https://t.co/L52UWqhmkR and all the reserve will be in CEXs.

— TRON DAO Reserve (@trondaoreserve) November 10, 2022

USDT issuer Tether disclosed that the firm processed approximately $700 million redemptions. This means users exchanged their digital tokens for USD or other supported fiat currencies amid market uncertainty.

The massive withdrawals as SBF’s FTX crypto exchange stared down the insolvency barrel also supposedly caused Tether to depeg slightly from the U.S. dollar Around the time of the depeg, the crypto community discovered that Sam Bankman-Fried’s Alameda Research opened USDT short positions.

What you are seeing below is an Alameda wallet deposit of $300k USDC into @AaveAave – Borrow $250k $USDT and then instantly sell it back to $USDC

This is technically an on-chain short of USDT, nothing significant but wtf is going on here? pic.twitter.com/A9pLXLCE4h

— blocmates. Behind on DMs apologies (@blocmatesdotcom) November 10, 2022

Justin Sun Suggests FTX Bailout Plan

Alameda’s short trade seemingly enraged the crypto community. Users haven’t heard from SBF or Alameda since Binance exited the deal to buy FTX. Zhao’s platform opted against bailing out FTX after reviewing the company’s balance sheet.

Reports after claimed that FTX owed over $8 billion and misused customer funds. The news preceded a bloodbath in crypto asset prices as fear of FTX contagion spread through the market.

WSJ number a little smaller than what I had heard, but I guess they note “shortfall” so likely Alameda had $1.5b-$2b sloshing around that could repay, and $8B short fall against a $10B hole.

(Also, I beat WSJ to a number?!) https://t.co/kmC49DZhcP

— Adam Cochran (adamscochran.eth) (@adamscochran) November 9, 2022

Justin Sun tweeted that plans for a solution to the FTX saga were in the works. Some users were skeptical and surmised that Sun was simply throwing weight behind a marketing stunt.

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Ethereum

Binance Makes Multi-Billion Dollar Transfers Following FTX’s Collapse

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Binance Makes Multi-Billion Dollar Transfers Following FTX’s Collapse
  • Binance has made transfers worth several billion dollars since the downfall of FTX.
  • Many of these transactions are associated with proof of reserves demonstrations undertaken by centralized exchanges.
  • A recent transaction of $2 billion caught the attention of on-chain whale watchers.
  • Changpeng Zhao has stated that the transaction was to prove ownership of the wallet. 
  • The exchange has clarified that more of these large transactions will take place to verify the ownership to auditors. 

The downfall of FTX has paved the way for the world’s largest crypto exchange to cement its position as the most popular exchange. Binance has been actively involved in the aftermath of FTX’s collapse, from indirectly triggering the bank run on the Bahamas-based exchange, to leading the way in establishing greater transparency in the industry by publishing proof of reserves. 

$2 billion transferred by Binance

Blockchain intelligence firm Arkham Intelligence published a Twitter thread that took a closer look at the billions of dollars that Binance has moved around over the past few days. The report was prompted after on-chain whale watchers alerted crypto Twitter about a massive transfer by the exchange that involved 127,351 BTC worth a little over $2 billion. 

The transfer was seen as a bad sign by many on Twitter given the current crypto climate. Binance had recently published its proof of reserve (PoR) and users on Twitter speculated that the transfer was actually the exchange reversing funds upon completion of the PoR. CEO Changpeng soon clarified that the massive transaction was in fact part of the PoR, but not how it was being perceived. 

“The auditor require us to send a specific amount to ourselves to show we control the wallet. And the rest goes to a Change Address, which is a new address. In this case, the Input tx is big, and so is the Change.” CZ tweeted. 

Binance previously published its PoR, but some still remain skeptical because the exchange has not provided any details about its liabilities, in addition to there being no evident segregation between its own assets and customers’ funds. 

Arkham Intelligence also shed light on some of Binance’s other recent transfers. For instance, the $1 billion BUSD transfer by the exchange which was supposedly for the Industry Recovery Fund launched by CZ. Binance also received close to $1 billion from Tether as part of its chain swap from Solana to Ethereum. 

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Ethereum

BlockFi declares bankruptcy, files Chapter 11

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BlockFi declares bankruptcy, files Chapter 11

Summary:

  • Crypto lender BlockFi declared bankruptcy on Monday after exposure to FTX.
  • The company had some 100,000 creditors and around $256 million in cash when chapter 11 was filed.
  • FTX backed the lender with a $250 million loan following Three Arrows Capital exposure.

Cryptocurrency lender BlockFi filed for chapter 11 bankruptcy on Monday following exposure to troubled crypto exchange FTX, the exchange founded by Sam Bankman-Fried. 

BlockFi held $256.9 million in cash when it filed for bankruptcy. The company also has around $1 billion in assets and liabilities alike. Per details of the filing, the lender boasts over 100,000 creditors including FTX US and the Securities and Exchange (SEC). 

The crypto lender reported $275 million in unsecured claims tied to FTX US. Notably, Sam Bankman-Fried’s exchange loaned $250 million to BlockFi back in June. At the time, BlockFi faced liquidity concerns after exposure to insolvent crypto hedge fund Three Arrows Capital (3AC).

Also, the lender owes $30 million to the SEC as part of a settlement agreement from February 2022. The largest creditor was Ankura Trust Company LLC with a $729 million claim.

BlockFi joined the chat

Celsius, FTX, Voyager, and now BlockFi all filed for bankruptcy in 2022 as the bear market unsettled crypto CeFi players. Hackers exploited loopholes in DeFi smart contract code, stealing billions from protocols, cross-chain bridges, and other decentralized finance solutions. Reports said October was the worst month for crypto hacks so far.

Nevertheless, the decentralized technology that backs digital assets jumped forward in leaps and bounds. Ethereum, the second largest blockchain behind Bitcoin, successfully deployed a major technological upgrade.

Blackrock and Google tapped crypto for services and offerings as well, signaling institutional interest.

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Amazon Taps The Russo Brothers For TV Series About The FTX Saga

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Amazon Taps The Russo Brothers For TV Series About The FTX Saga
  • Amazon is set to release an eight-part series based on the collapse of FTX.
  • The streaming giant has teamed up with the Russo brothers and David Weil for the production of this series.
  • The Russo brothers have described the FTX scandal as one of the most brazen frauds ever committed. 
  • Apple is also working on a movie based on Sam Bankman-Fried’s activities in the run-up to FTX’s implosion.

Streaming giant Amazon has partnered up with famed directors Anthony Russo and Joseph Russo, also known as the Russo brothers, to release an eight-part TV series based on the spectacular collapse of Bahamas-based crypto exchange FTX.

Amazon will begin production in spring 2023

According to a report by Variety, the streaming firm has teamed up with AGBO, the production company of the Russo brothers who are known for their involvement with several Marvel movies. David Weil is set to be the executive producer of the show, in addition to writing the pilot. The show will go into production in spring 2023 and will be based on “insider reporting” by journalists who covered the downfall of what was once the world’s second-largest crypto exchange. 

This is one of the most brazen frauds ever committed; It crosses many sectors – celebrity, politics, academia, tech, criminality, sex, drugs, and the future of modern finance. At the center of it all sits an extremely mysterious figure with complex and potentially dangerous motivations. We want to understand why.” the Russo brothers said.

Amazon is reportedly trying to get the famed duo to direct the series as well. 

Apple is nearing a deal for book rights on SBF & FTX

Fellow streaming firm Apple is also looking to get a piece of the FTX pie. According to a report by Deadline, Apple is about to close a deal for the book rights to Michael Lewis’ story about the fall of Sam Bankman-Fried and his crypto empire. 

Michael Lewis is known for several books that were adapted into popular movies like Moneyball and The Big Short. Lewis had been following Bankman-Fried for six months before his exchange imploded, taking down several companies with it. The deal is reportedly in the mid-seven figures range and is expected to be adapted into a feature film. 

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