Updated: Dec 6, 2022
Action in the Digital Currency Markets is Reminiscent of an old style Bank Run!
The headlines have been hot and heavy to confirm that crypto investors or speculators want liquidity.
No doubt, there's more to come in the search for crypto liquidity?
Crypto Exchange Binance To Buy Rival FTX by Katie Clinebell
Published November 08, 2022
Binance, the largest crypto exchange by trading volume, said it would buy FTX as its smaller rival struggles amid speculation over its finances. The two giant crypto exchanges have signed a non-binding letter of intent.
Binance plans to buy FTX's non-U.S. operations in latest crypto bailout WASHINGTON/LONDON, Nov 8 (Reuters) - Crypto giant Binance signed a nonbinding agreement to buy rival FTX's non-U.S. unit, FTX.com, to help cover a "liquidity crunch" at the cryptocurrency exchange, the companies said on Tuesday, in a surprise move that raised fresh concerns about the risks investors face in the volatile crypto market.
Reporting by Tom Wilson in London and Hannah Lang in Washington Additional reporting by Tom Westbrook in Singapore, Prentice in Washington and Angus Berwick in New York Editing by Megan Davies, Catherine Evans and Matthew Lewis
Wall Street Journal:
Crypto Exchanges Tout Their Reserves After FTX Woes
Robinhood Shares Tumble in FTX Fallout
By Gunjan Banerji Robinhood Markets' shares dropped more than 14% in recent trading. Potentially driving the move? Crypto exchange Binance's proposed takeover of FTX, which followed a liquidity crunch at the firm.
Bitcoin drops to a new low for the year, FTX token loses 80% in broad crypto sell-off
Coinbase Says No Exposure to FTT Token and Alameda, Minor Deposits at FTX
"There can't be a 'run on the bank,' said Coinbase (COIN) in a statement, noting its publicly-filed and audited reports show all customer assets as fully backed.
The company said it has minimal exposure to struggling crypto exchange FTX, with just $15 million on deposit there to facilitate business operations and customer trades. Coinbase further said it has no exposure to FTX's token FTT – which has plunged about 80% today – and no exposure to FTX sister company Alameda Research.
The exchange did have some technical issues Tuesday, acknowledging network connection problems for both web and mobile. It's unclear at this time if those outages have been fixed.
Coinbase shares are down 10.6% today as bitcoin (BTC) plunged earlier to a new 2022 low below $17,500. A modest bounce has brought the price back to $18,200 at press time.
We've waited a long time for some direction as to when and how our government will proceed on Digital Assets.
Akin Investments continues to monitor the White House, Treasury, Federal Reserve, Securities Exchange Commission and other regulatory authorities for more clarity and of course we'll keep our readers informed.
401k Retirement Plans and "Crypto Currencies"
In recent months, the Department of Labor has become aware of firms marketing investments in cryptocurrencies to 401(k) plans as potential investment options for plan participants.
The Department cautions plan fiduciaries to exercise extreme care before they consider adding a cryptocurrency option to a 401(k) plan’s investment menu for plan participants.
Under ERISA, fiduciaries must act solely in the financial interests of plan participants and adhere to an exacting standard of professional care. Courts have commonly referred to these prudence and loyalty obligations as the “highest known to the law.” Fiduciaries who breach those duties are personally liable for any losses to the plan resulting from that breach. A fiduciary’s consideration of whether to include an option for participants to invest in cryptocurrencies is subject to these exacting responsibilities.
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