The FINRA Initiates Investigations into Crypto Retail Communications regarding Services and Products

Alexander Salazar
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<strong>The FINRA Initiates Investigations into Crypto Retail Communications regarding Services and Products</strong>

The regulator announced it would investigate cryptocurrency-related companies to delve into how they manage retail communications. In January, regulators from Singapore, the UK, and Spain tightened their regulations through stricter requirements for marketing messages at crypto companies.

The FTX collapse has led to many reactions due to its adverse effects on the prices of most crypto assets. Many investors and analysts have lost confidence due to numerous recent events in the industry.

Many companies and venture capitalists have suffered losses due to the crash of FTX. The situation worsened considerably as more entities increased their exposure to the cryptocurrency exchange.

Due to the fall of FTX, regulators in various jurisdictions have expressed their sentiments. The circumstances surrounding Sam Bankman-Fried, the CEO of FTX, and his trading platform Alameda Research triggered those reactions.

The Financial Industry Regulatory Authority (FINRA), a US self-regulatory organization, has moved around the current situation. They have investigated retail communications from companies regarding their crypto products and services.

The FINRA Investigates Crypto Companies regarding Retail Communications

The American regulator officially announced that it would launch an investigation into cryptocurrency-related companies. It aims to delve into how they have managed retail communications from early July to late September.

The regulator initiated the investigation to determine whether any retail crypto products and services had fake advertising. During the successful bullish run, FTX was among the most prominent promoters of cryptocurrencies.

The FINRA has explained that it would investigate crypto companies by analyzing any handwritten or electronic message issued within 30 days. Furthermore, the regulator said it would include videos, mobile apps, social networks, websites, and written submissions.

Upon announcing the investigation, the regulator requested that 25 firms provide information for each personal communication. These would include their posting date and evidence of filing with the advertising regulation department of the FINRA.

They will also show evidence that a principal at the firm approved the communication and that they mentioned tokens or crypto services in it.

Crypto Advertising Meets No Regulatory Standards, Raising Considerable Concern

The sudden increase in crypto advertisements in various regions raised considerable concern among regulators, as most do not meet regulatory standards. Many highlighted the potential gains from investing in cryptocurrencies as they hid related risks.

In early 2022, regulators like Singapore, the UK, and Spain tightened their regulations, setting stricter requirements for marketing messages at crypto companies. The collapse in the crypto market also led some countries to introduce restrictions on cryptocurrency advertising.

Steph Curry, Tom Brady, and Larry David, among other celebrities that promoted FTX, now face a class action lawsuit. Regulators charged them with advertising the fraudulent scheme of the FTX cryptocurrency exchange.

Meanwhile, FTT is trading at around USD 1.45 and has accumulated a 7.1% loss over the last 24 hours. While its daily trading volume is above USD 16.87 million, its market capitalization is USD 0, according to CoinDataFlow.

Investors should research FTT or any other cryptocurrency before buying it to learn about its all-time high, behavior, and possible future price. That allows them to make better investment decisions and avoid the loss of money.

By Alexander Salazar

Despite Overall Market Uncertainty, the Prices of Bitcoin and Ether Remain Stable

Alexander Salazar
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<strong>Despite Overall Market Uncertainty, the Prices of Bitcoin and Ether Remain Stable</strong>

Since the price of BTC remains locked at its resistance level, it might have a breakout target of USD 14,300. The value of ETH remains locked at the USD 1,220 resistance level as it comes across other daily obstacles.

After reaching a new low of around USD 15,400, Bitcoin (BTC) has remained stable between USD 15,000 and USD 17,000. Investors are waiting for the resolution of that range to know where the price might head next.

Bitcoin is trading at around USD 16,661 and has accumulated a 0.57% loss over the last 24 hours. While its daily trading volume is above USD 14.61 billion, its market capitalization is about USD 320.07 billion, according to CoinDataFlow.

The daily chart shows that the price of BTC remains locked at its resistance level. Therefore, the market might continue to be bearish with a breakout target of USD 14,300.

The bearish outlook will last longer if the price moves below the previous range of less than USD 18,500. BTC might drop, as the target corresponds to a relevant weekly support at 1,618 Fibonacci, equivalent to a falling wedge bottom.

Ether Might Drop Further If It Loses Its Resistance Level

The price of Ether (ETH) remains locked at the USD 1,200 resistance level as it faces other daily obstacles. The bearish scenario remains valid and indicates a likely return to a price of around USD 762.

Ether is trading at around USD 1,209 and has accumulated a 0.91% loss over the last 24 hours. While its daily trading volume is above USD 4.02 billion, its market capitalization is about USD 145.71 billion, according to CoinDataFlow.

If the value of Ether rallies back above USD 2,000, it might target a break out of this long bearish momentum. However, there is much resistance, which seems to hinder an increase in the current context.

The Decline in the Prices of BTC and ETH to Continue

Although the prices of Bitcoin and Ether are stable, they remain bearish while keeping clear objectives. The decline should last longer if their weekly resistance levels fail to recover as support.

Despite the bearish trend, Amid Nayib Bukele, the president of El Salvador, stands firm in emptying the national treasury to fill it with BTC. After he announced that he would buy one bitcoin daily, Justin Sun, the CEO of Tron, said he would do the same.

Investors should research Bitcoin and Ether before buying them to learn about their all-time highs, behavior, and possible future price. It is a matter of time before seeing where the market will take the two leading cryptocurrencies.

By Alexander Salazar

How to Avoid Traps like FTX

Audy Castañeda
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<strong>How to Avoid Traps like FTX</strong>

The bankruptcy of FTX caused a significant collapse in the cryptographic ecosystem, which makes it necessary to protect yourself in future scenarios.

FTX’s bankruptcy echoed a resounding crash in the crypto ecosystem. In just a few hours, the decentralized exchange platform that had been the industry leader until then came crashing down. Thus, the fairy tale of its ex-CEO Samuel Bankman-Fried became a drama, dragging unsuspecting victims all over the world.

Therefore, it is essential to learn how to protect yourself against these types of disasters. Even if zero risk doesn’t exist, there are still good practices to approach it to keep your cryptos safe, such as offline storage.

Hot Crypto Storage in Small Doses

The wallet is the tool par excellence that allows you to manage your cryptos. The protection of the latter should be a priority when you decide to take the step into the cryptosphere. You can keep your assets online, meaning on the Internet, or offline, meaning off the Internet.

By storing your crypto online or hot, you transfer the responsibility of managing your keys to a third party when it goes through a centralized exchange (CEX). As a result, you risk repeating an FTX scenario. In other words, you give someone else access to your vault and hope they put it to good use. It’s a risky bet that often leads to mishaps.

Even when you choose a non-custodial wallet such as Metamask, where you manage your keys, the risk of your account or platform being hacked is just as prevalent. As long as your wallet is connected to the internet, it will always be vulnerable.

It can be tempting to get carried away with the ergonomic experience and free nature of an online wallet. However, you are exposing yourself to malicious acts, the consequences of which can make you lose all your cryptocurrencies. Therefore, it is recommended that you keep in this type of wallet the minimum you need to make your immediate transactions. For the rest, you have cold rooms.

Offline Wallet, Guarantee of Optimal Security

Putting your assets in an offline wallet gives you full responsibility for managing them and their keys. A wallet disconnected from the internet, or a cold wallet, is the safest solution to keep your cryptos with complete peace of mind. This cold storage can take the form of a paper wallet or a hardware wallet. You can carry it with you as your fiat currency wallet.

Nowadays, caution is necessary at all times. Cold or offline storage remains to this day the most efficient security solution for your cryptos. This gives you responsibility for managing your assets. It also goes far beyond keeping the keys in a safe place. You also need to keep up with the news. It is your responsibility to stay informed when investing in cryptocurrency.

By Audy Castaneda

Anthony Pompliano Views the Crypto Industry as the Real Judge in the Case of FTX

Alexander Salazar
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<strong>Anthony Pompliano Views the Crypto Industry as the Real Judge in the Case of FTX</strong>

Pompliano commented that the market eliminates bad people and deals to ensure high-quality representation, acting as a judge. The crypto community believes Sam Bankman-Fried served as a black hat hacker to keep the money within Bahamian jurisdiction.

Anthony Pompliano, an American entrepreneur and investor, still believes in the crypto industry despite the disappointing conduct of Sam Bankman-Fried. The latter stopped being the white knight of cryptocurrencies due to his mishandling of FTX client funds and strange behavior on Twitter.

Pompliano recently commented that the market eliminates bad people and deals to ensure high-quality representation. He views the industry as a judge, stating that Changpeng Zhao took advantage of that to take FTX down.

The entrepreneur also believes many people claim not to have information and not knowing what happens. He added that he keeps money assets on FTX, with which it has an advertising relationship.

This Bitcoin supporter has drawn attention to saying that Satoshi Nakamoto deserves the Nobel Prize for Peace. Besides, he has advocated including cryptocurrencies in pension funds and described the energy consumption of mining as crucial.

Meanwhile, Nobody Knows Who Owns the Funds of FTX Users

Last week, the crypto community was in an uproar upon learning that FTX had suddenly moved a considerable sum from the exchange. After that, there was a battle between the black hat hackers, who withdrew the funds, and the white hat hackers, who struggled to secure USD 600 million.

The attack occurred about twelve hours after FTX filed for bankruptcy protection following nearly seven days of trouble. Since then, the hacker has converted around USD 300 million into Ether (ETH), thus becoming the 34th largest Ethereum whale.

According to statements by the representative of the bankruptcy unit taking over FTX, this team may be playing the role of white hat hackers. They struggle to recover money after they become aware of suspicious activities.

The Kraken exchange also claims to have identified the black hat hacker that attacked FTX. Since he reportedly deposited funds through the exchange as a fee for the hack, they froze his account as required by law.

The current bankruptcy team of FTX claimed Sam Bankman-Fried and the Bahamian government planned to move funds to the Bahamas, where laws are lax. The former CEO of FTX leaked text messages expressing that he greatly regretted filing for bankruptcy protection.

Besides triggering a crucial crisis in the crypto industry, the collapse of FTX has dragged down other organizations. It has also caused a legal overlap as the exchange has over 130 branches worldwide, two of which have gone bankrupt simultaneously.

The Bahamas Securities Commission denied calling for the FTX exchange to resume withdrawals for Bahamians, causing several consumers to try to breach the KYC protocol.

It is still necessary to wait for further confirmation from interested parties to see who owns the funds of FTX users. However, the crypto community believes Sam Bankman-Fried acted as a black hat hacker to keep the money within Bahamian jurisdiction.

By Alexander Salazar

Genesis Crypto Lender Requests $1 Billion Emergency Loan

Audy Castañeda
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<strong>Genesis Crypto Lender Requests $1 Billion Emergency Loan</strong>

It happened before they suspended withdrawals on the website. At the time, it had $2.8 billion in total active loans.

Cryptocurrency lender Genesis asked for an emergency loan of $1 billion from investors. It happened before suspending withdrawals on its website, the Wall Street Journal reported, citing a confidential fundraising document.

The document refers to a liquidity crisis due to certain illiquid assets on Genesis’s balance sheet. On Wednesday, the firm suspended customer repayments in its lending business. It was in the midst of the sudden crash of the FTX cryptocurrency exchange, led by Sam Bankman-Fried.

In an interim call, Derar Islim, CEO of Genesis Global Capital, confirmed the temporary closure of the cryptocurrency lending department, thus ceasing the possibility of withdrawing funds.

The department involved provides services to a broad base of institutional clients. It had $2.8 billion in total active loans as of the end of the third quarter of 2022, according to results posted on the company’s website.

The FTX implosion has wreaked havoc on the industry. There were difficulties in the liquidity of the companies exposed to what was one of the largest cryptocurrency exchanges in the world. The crisis has also led to investigations by regulators in several countries.

After Genesis Global Capital ceased withdrawals for exposure to FTX, Tether clarified that it has “absolutely no exposure to Genesis or Gemeni Earn.” It recalled that Tether tokens are 100% backed by its reserves and that the assets supporting them outweigh the liabilities.

Binance Does Not Reveal More Details

The world’s largest cryptocurrency exchange, Binance, revealed that it cannot share any further details or documentation about its trading with FTX, because they’re cooperating with regulatory authorities.

According to The Block, regulatory authorities are also questioning Binance about its actions in the face of the FTX crash. The UK recently announced that it would investigate the failed deal of both exchanges.

Binance would be collaborating with US regulators as it has been doing it with UK regulators, by providing all kinds of documents and details about the intent to purchase FTX prior to its bankruptcy.

The latest on FTX

According to Business Insider, John J. Ray, who was announced as the company’s new CEO on Friday, in a statement submitted as part of the FTX Chapter 11 bankruptcy filing and published today, claimed that “In the Bahamas, I understand that FTX Group corporate funds were used to purchase homes and other personal items for employees and consultants.”

Ray’s statement also asserts that FTX “did not have the type of payout controls that I believe are appropriate for a commercial enterprise.” In this regard, he noted that employees submitted payment requests through an online chat platform.

By Audy Castaneda

Dollar Shows Upward Trend Amid Mixed Signals in the Markets

Audy Castañeda
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<strong>Dollar Shows Upward Trend Amid Mixed Signals in the Markets</strong>

Investors watched hawkish comments from Federal Reserve officials as sterling fell.

The US dollar performed strongly in the foreign exchange market, as US Treasury yields rose.

Investors watched aggressive comments from Federal Reserve officials, while sterling fell on general public disappointment over the latest UK government budget.

The dollar has rallied somewhat after falling in recent weeks, as inflation data, as well comments from Fed officials, boosted bets that the US central bank may soon slow its interest rates hikes.

However, during an event on Thursday, St. Louis Fed President James Bullard held up a chart suggesting that even dovish assumptions would require the central bank’s policy rate to rise to at least around 5%.

Some stricter forecasts suggest that said rate would be above 7%. The fed funds rate is currently in the 3.75%-4.00% range, after a series of aggressive hikes.

The Dollar and the Euro in Opposite Directions

Joe Perry, senior market analyst at FOREX.com and City Index in New York, told Reuters that Fed Chairman Jerome Powell’s approach remains firm, so further increases are expected in the short term. While he expects the dollar to go lower over the longer term, Perry sees the “opportunity for a bounce to 109.25 or so on the dollar index, to then turn around and continue lower.”

Perry also commented that the Euro presents a trend contrary to the dollar’s, so it is expected that it will fall in the short term, and then rise, as the current monetary policy measures calm down.

Bullard spoke a day after San Francisco Fed President Mary Daly, until recently one of the most dovish of its officials, raised doubts about a central bank change of direction, by saying a pause was off the table.

Sterling Slowly Sinks

Brad Bechtel, global head of FX at Jefferies, described Bullard’s presentation as “relatively aggressive,” and also noted that the gain in US Treasury yields was also helping the dollar on Thursday.

Also noting sterling’s move on Thursday, Bechtel said investors were worried about UK Chancellor Jeremy Hunt’s budget, which included tax increases and tighter government spending, aimed at cooling inflation and thus restoring the economic reputation of the country.

“The budget had some holes in it and it wasn’t that impressive from a markets standpoint,” Bechtel said. “They are plugging a hole by hitting the consumer. You have a failing economy and a cost of living crisis, and taxes are going up.”

Sterling fell 0.53% to $1.1850, after falling as much as 1.25% to $1.17645.

The dollar index, which measures the dollar against six major pairs, recently rose 0.38% to 106.687. After hitting a 20-year high in late September, the index had lost more than 8% when it touched its most recent low on Tuesday.

By Audy Castaneda

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