FTX Founder Sam Bankman-Fried’s Trial Begins
The trial of FTX founder Sam Bankman-Fried began on October 10, with testimony from former Alameda CEO Caroline Ellison. Prosecutors had requested a Ukrainian FTX customer to testify remotely, but the request was declined. Bankman-Fried’s legal team cited concerns about the emotional impact of the conflict between Russia and Ukraine and potential jury bias. The trial is taking place in New York, and Bankman-Fried faces charges related to fraud against customers and investors. No plea offer has been made by the prosecution. Witnesses include FTX’s former CTO, Gary Wang, former exec Nishad Singh, and attorney Daniel Fried. A verdict is expected within four to six weeks.
FTX Hacker Moves Stolen Funds
The hacker who exploited the FTX platform for $413 million last November moved some of the stolen funds this week. THORSwap, a prominent DEX, suspended all swaps on its platform and went into maintenance mode due to the growing use of the platform to route stolen funds. The hacker converted 75,636 ETH worth $124 million to tBTC and moved the tokens to the Bitcoin network through Threshold.
More Layoffs in Crypto Sector
Reports this week revealed that crypto-focused entities experienced $685.5 million in financial losses during Q3 2023, primarily due to exploits on cross-chain protocols. As a result, several crypto-oriented companies have been downsizing their workforce. Chainalysis reduced its staff by 15%, parting ways with 135 employees out of their previous 900. Chia Network also laid off 26 employees as it prepares for an IPO. Meta, the parent company of Facebook, implemented job cuts within its Reality Labs division. Ledger CEO Pascal Gauthier announced a potential 12% reduction in the company’s workforce.
Israel and Hamas Conflict Escalates
The conflict between Hamas and Israel escalated on October 8, with Israel Defense Forces launching lethal airstrikes in response to a surprise attack by Gaza militants. Hundreds of Israelis and Palestinians were killed. Hamas ruled the Palestinian territory of Gaza since 2007 and had relied on crypto funds for years. In August 2020, the U.S. Justice Department claimed to have dismantled “three terrorist financing cyber-enabled campaigns” and seized millions of dollars worth of digital assets.
Ripple vs. U.S. SEC Legal Battle Continues
Ripple secured another victory in its legal battle against the SEC when Judge Analisa Torres denied the SEC’s motion to file an interlocutory appeal. The case will go to trial on April 23, 2024. Following the order, XRP surged 5%. Ripple also obtained a Major Payments Institution license in Singapore, allowing them to provide regulated digital asset services in the country. Coinbase also received a similar license from the Monetary Authority of Singapore.
CFTC Chair Stresses Importance of Crypto Regulation
CFTC Chair Rostin Behnam emphasized the need for strong crypto regulation, suggesting that 70% of crypto assets should be classified as commodities. He urged Congress to establish clear digital asset regulations and expand the CFTC’s authority. U.S. Representative Patrick McHenry also expressed support for crypto-friendly regulations.
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