HCohen schreef op 17 november 2022 13:57:
Crypto dominoes fall in the wake of FTX's collapsewww.axios.com/2022/11/17/crypto-domin... The collapse of FTX and Alameda Research continues to reverberate through the crypto world — and more dominoes are falling.
The latest: On Wednesday, the crisis touched a high-profile crypto lender run by the billionaire twins Cameron Winklevoss and Tyler Winklevoss, forcing them to halt withdrawals from their Gemini Earn crypto lending program.
The big picture: It's a classic case of contagion. That’s when the failure of one institution sets off a rush among customers to redeem their money, which makes the institution's lending and borrowing impossible — ultimately generating a cascade of similar closures from other firms.
The U.S. banking crisis of 1930-31 is perhaps the textbook case of financial contagion (as anyone who's watched "It's a Wonderful Life" knows)
The financial crisis of 2008 — triggered by the collapse of Lehman Brothers — was a similar episode.
State of play: The Gemini Earn program allowed users to deposit their coins in exchange for regular interest payments — typically at generous rates that could be as high as 8%.
In a note to clients posted on its site, Gemini pointed out that its lending partner in the Earn program — a separate crypto lender known as Genesis — had "paused withdrawals and will not be able to meet customer redemptions within the service-level agreement (SLA) of 5 business days."
What's happening: Since FTX filed for bankruptcy on Friday, the crisis has caused problems for a growing list of firms, some considered cornerstones of the crypto industry just last week.
- Crypto lender
BlockFi is considering filing for bankruptcy, according to the Wall Street Journal.
- Bankrupt crypto brokerage firm
Voyager Digital, whose assets FTX founder Sam Bankman-Fried agreed to purchase for $1.4 billion, has reopened bidding to find a replacement buyer.
- Crypto hedge fund
Galois Capital said roughly half its capital is stuck in FTX, according to the Financial Times.
- Travis Kling, who ran crypto hedge fund
Ikigai Asset Management said on Tuesday that "a large majority of the hedge fund's total assets" had been ensnared in FTX.
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Tom Brady, Gisele Bündchen, Kevin O'Leary, and 9 Other Celebrities Named in FTX-Related Class-Action Lawsuitnews.bitcoin.com/tom-brady-gisele-bun... Class Action Lawsuit Accuses SBF and 12 Celebrities of Pumping a ‘Ponzi Scheme,’ Claims $11 Billion in Damages Suffered