White House meetings with Sam Bankman-Fried 'focused on pandemic prevention'

Katherine Doyle

January 03, 05:22 PM January 03, 05:22 PM

FTX founder Sam Bankman-Fried’s meetings with top advisers to President Joe Biden “focused on pandemic prevention-related matters,” according to the White House.

Biden’s press secretary said Bankman-Fried also discussed “general information” on the cryptocurrency industry and crypto exchanges while meeting with counselor to the president Steve Ricchetti and deputy chief of staff Bruce Reed, longtime Biden confidantes, in the months before FTX’s implosion.

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White House visitor logs show his most recent visit took place in September, about two months before the exchange collapsed. The Justice Department has charged Bankman-Fried with attempting to defraud investors of $1.8 billion.

White House press secretary Karine Jean-Pierre said the meetings were part of the administration's routine engagement “with officials from a range of sectors and industries, including leaders in business and labor and nonprofits,” and that it “has been clear about the need for Congress to take action when we talk about addressing cryptocurrency.”

Jean-Pierre declined to comment on whether the Democratic Party or aligned groups should consider returning donations Bankman-Fried made.

Bankman-Fried gave lavishly to Democrats during the midterm elections and contributed to Biden’s 2020 campaign. He was tipped as a prominent future political megadonor for the Democratic Party.

He also funded a non-profit aimed at pandemic prevention and operated by his brother, another visitor to the White House, the logs show.

The former crypto billionaire pleaded not guilty to U.S. criminal charges Tuesday.

Entire crypto sector faces reckoning after FTX collapse

Zachary Halaschak

November 22, 06:30 AM November 22, 06:30 AM

The spectacular collapse of the crypto exchange FTX sent ripples throughout the world of finance in what appears to be a reckoning for the future of cryptocurrency.

FTX was one of the biggest cryptocurrency platforms in the world and had been vaunted at a massive scale by super-powered marketing campaigns featuring the likes of Tom Brady and Steph Curry. This month, that house of cards quickly collapsed, leaving many fearful that more blockchain companies, such as FTX rivals Binance and Coinbase, and digital currencies will face a loss of confidence and suffer failures.

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“In a way it’s far worse than [Bernie] Madoff and far worse than Lehman [Brothers],” David Weisberger, CEO of CoinRoutes, told the Washington Examiner.

The value of bitcoin itself has suffered greatly in just a matter of days. The flagship cryptocurrency tumbled to $15,600 on Monday, its lowest level in two years. That represents a 24% loss in value since the start of the month alone.

Cryptocurrency giant FTX, facing a sudden loss of faith in its solvency, declared bankruptcy — sending tens of thousands of investors into disarray.

The fallout has been enormous because of FTX's size and reach. FTX was valued at $32 billion in a financing round before the collapse this year. It was also the third-largest crypto exchange by volume, after Binance and Coinbase.

“This is sort of the equivalent of a big brokerage firm going under,” said David Sacco, a practitioner in residence at the University of New Haven finance department.

Sacco said that while bitcoin and many cryptocurrencies have mainly been declining in value over the past year or so, at the same time, trading and holding cryptocurrency on exchanges and platforms such as FTX became more mainstream.

Seeing a giant company and cryptocurrency platform that some staked their life savings on fall completely apart and file for Chapter 11 in just days inevitably undermines trust in other platforms and crypto companies. Especially given how much positive attention FTX and its founder, now disgraced Sam Bankman-Fried, received in the media.

“The question is, are the remaining platforms — the Coinbases and the Binances of the world — are they more sound? in which case I suspect the reputation of crypto will recover. Or do some of them maybe have the same issue? In which case we could be headed even further downward,” Sacco said. “The next stop is for the market to prove that it’s either legit and this is a sort of one-off bad actor, or is it more systematic within the whole crypto universe.”

The growing mistrust appears to be sticking around for the remaining two biggest companies as crypto investors reckon with a future after FTX.

Coinbase’s stock declined by nearly 9% on Monday alone — the lowest price since the company went public. In the past month, the company has lost about 38% of its entire value. That only adds to the downward pressure the company’s stock has faced, given that the price of bitcoin has been in retreat over the past year since peaking at $69,000 a year ago. In one year, Coinbase’s stock has fallen by 87%.

“Coinbase shares can't catch a break,” said Oanda senior market analyst Edward Moya, per CoinDesk. “The major cryptocurrency exchange has yet to convince investors that its share price will stabilize like some of the other top cryptos as investor skepticism about trading on exchanges grows.”

Binance, which is the world’s largest cryptocurrency exchange, saw massive withdrawals in the days after FTX’s collapse, indicating the fear and mistrust that some investors have following the fall from grace. In the six days after, Binance users withdrew some $1.35 billion, or more than 15% of the bitcoin on the exchange.

This year there was also a bit of a convergence between traditional assets such as stocks and digital assets like bitcoin and ether. When the stock market would rally, cryptocurrencies generally popped as well, and when Wall Street had a rough day so too did the cryptocurrency world, in many instances. That might be seen as part of the growing institutional acceptance and normalcy of digital assets, but since the FTX crash that has changed.

“This may lead to a little decoupling in the sense that now people are worried about these platforms and the health of these platforms,” Sacco said, noting that as stocks have gained over the past few weeks, bitcoin has not moved in tandem but has instead declined.

The FTX scandal has also generated new pressure for regulation of the cryptocurrency space.

The House Financial Services Committee announced that it would hold a hearing in December to probe the cryptocurrency company’s descent into bankruptcy. The committee expects to hear from the companies and people involved, including Bankman-Fried, Alameda Research, Binance, FTX, and others.

“The fall of FTX has posed tremendous harm to over one million users, many of whom were everyday people who invested their hard-earned savings into the FTX cryptocurrency exchange, only to watch it all disappear within a matter of seconds. Unfortunately, this event is just one out of many examples of cryptocurrency platforms that have collapsed just this past year,” said Chairwoman Maxine Waters (D-CA).

The Senate is also holding a hearing titled “Why Congress Needs to Act: Lessons Learned from the FTX Collapse” on Dec. 1 that will feature CFTC Chairman Rostin Behnam.

Cryptocurrency magnate, new GOP megadonor, sunk hundreds of thousands into primaries

David M. Drucker

September 18, 06:30 AM September 18, 06:31 AM

Budding Republican megadonor Ryan Salame quietly shelled out $13.4 million of his particular fortune to enhance 15 GOP congressional candidates in the just-concluded 2022 primaries.

Salame, a 29-year-old cryptocurrency mogul, life in the Bahamas, which is the headquarters of FTX Electronic Markets, the agency he oversees as chief executive officer. But he’s a indigenous of Berkshire County, Massachusetts, and as a self-described “libertarian”-leaning Republican, he resolved to get concerned in politics this yr since he thinks the federal authorities is gravely unprepared for the upcoming pandemic. So, Salame released a tremendous PAC to boost like-minded candidates in GOP primaries.

“I’ve experienced a ton of achievements on the personal facet, in the small business sector, and I imagine coming out of that, [I was] making an attempt to consider of techniques that we could definitely advantage The us and United States citizens — place a little something forward for potential generations,” Salame advised the Washington Examiner on Thursday in his initial job interview to examine his super PAC, American Desire Federal Motion.

“Living by way of and likely as a result of COVID, it turned abundantly obvious that we’re not prepared for pandemics and not prepared for … long run viral outbreaks,” Salame said. “It’s truly crucial — and it’s one particular of the best issues that we can do for potential generations to make certain that we are organized for them.”

With American Dream Federal Action, Salame is element of the escalating checklist of younger finance and technological innovation business owners and executives immersing themselves in politics, using their prosperity to back again Democratic and Republican candidates, respectively. Notable amid them is Salame's colleague, Sam Bankman-Fried, who has emerged as a big Democratic donor. Bankman-Fried is the founder of FTX Electronic Marketplaces, a cryptocurrency exchange registered in the Bahamas, and is the CEO of its guardian corporation, FTX Investing Ltd.

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Regardless of Salame’s libertarian bent, he concluded successful preparation for the future coronavirus-form pandemic should be led by the federal governing administration. That, he determined, will only happen if customers of Congress prioritize the challenge and move the requisite legislation. To start the system, he, along with the political team he assembled at his super PAC, screened Republicans managing for the Residence and Senate, eventually backing 15 who supported his enthusiasm for pandemic preparedness.

On average, Salame invested virtually $900,000 in each and every candidate’s principal. Thirteen won their respective nominations, including: Sen. John Boozman (R-AR) Rep. Brad Finstad (R-MN) Rep. Mike Simpson (R-ID) Rep. Dusty Johnson (R-SD) Rep. David Schweikert (R-AZ) Rep. Ted Budd (R-NC), the GOP Senate nominee in North Carolina and Katie Britt, the GOP Senate nominee in Alabama.

Also backed by Salame’s super PAC have been Erin Houchin, the GOP nominee in Indiana’s 9th Congressional District Bo Hines, the GOP nominee in North Carolina’s 13th Congressional District Dale Potent, the GOP nominee in Alabama’s 5th Congressional District Eli Crane, the GOP nominee in Arizona’s 2nd Congressional District Mark Alford, the GOP nominee in Missouri’s 4th Congressional District and Aaron Beane, the GOP nominee in Florida’s 4th Congressional District.

Just two of the Republicans backed by American Desire Federal Action fell small in their primaries: Rep. Rodney Davis (R-IL) and Matt Mowers, the operating-up for the nomination in New Hampshire’s 1st Congressional District. Salame indicated his foray into politics is a extensive-phrase proposition, indicating he realized a great deal about the process with this preliminary effort.

“Being rather new to this, I was not really positive the amount of money it would consider to have a real influence. At the onset, I preferred to continue to keep it beneath $25 million,” Salame explained. “There’s not an specific science. We seem at candidates holistically, glimpse at what they’ve explained earlier about pandemics, see if there’s any heritage, and then shift ahead with candidates in that manner.”

As much as what’s up coming in the midterm elections, Salame was obscure.

Having said that, Salame indicated American Dream Federal Motion is not possible to plow approximately as much revenue into the drop campaign as the team did in Republican primaries to enhance the 13 candidates he backed that are on the November ballot.

“We will participate in in the general [election],” he reported, “but to a scaled-down degree than we have in the most important.”

When Salame, who is solitary with no children, isn’t in the Bahamas jogging FTX Digital Markets, he’s in Washington, D.C., in which he also maintains a residence. Prior to devoting his electricity to politics, Salame, who grew up doing work menial employment in dining establishments in Berkshire County, applied his prosperity to open up a number of dining places in and around his hometown.

His strategy for American Dream Federal Motion in the coming elections is to carry on supporting Republican candidates who believe in improving the capacity of the federal governing administration to react to pandemics. Regardless of the country’s the latest practical experience with COVID-19, Salame believes Washington is wholly unprepared to offer with the issues that would probable accompany a potential crisis.

“I would go as considerably as declaring, ‘Not organized at all,’” Salame reported.

Ethereum pulls off the 'Merge,' a seismic modify for cryptocurrency

Christopher Hutton

September 15, 11:37 AM September 15, 11:37 AM

The 2nd-most significant cryptocurrency pulled off a major update to the way that it produces tokens, location a new precedent for the market and radically reducing its power use.

On Thursday, ethereum carried out what is currently being named the "Merge," a highly anticipated change to the way the currency validates tokens in its process.

"Happy merge all," tweeted ethereum founder Vitalik Buterin. "This is a large minute for the Ethereum ecosystem. Everybody who aided make the merge take place should really experience really very pleased now."

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With the Merge, ethereum's method for producing the tokens tracked on its blockchain ledger, recognized as Ether, has transitioned from "proof of work" to "proof of stake."

The "evidence of do the job" technique experienced buyers "mine" the forex by acquiring computers method a series of algorithms in competitors with other desktops to generate Ether. Even though most cryptocurrencies use this method, it consumes an massive amount of money of power and has been the subject of scrutiny by New York regulators.

The Merge experienced ethereum swap to "evidence of stake," a technique of token development in which customers put in "validators," application that aids system transactions of ethereum and that requires them to maintain a minimum amount of 32 ETH, or about $53,000, in buy to be approved. The validators are then preferred randomly by an algorithm to "mine" coins and validate a linked block of transactions.

The update will have an tremendous impression on cryptocurrency's environmental influence, according to industry specialists. The transition will allegedly reduce the electrical power intake and carbon footprint of the ethereum network by around 99.988 % and 99.992%, according to a report from the Crypto Carbon Ratings Institute.

The ethereum merge has been promoted for various years. Buterin wrote about "proof of stake" in a 2014 web site submit just before the forex came into existence and experienced been earning attempts to pursue the "Merge" for at the very least two several years. These efforts bundled partnering with the tech enterprise Consensys to make the "Beacon" chain, a separate ethereum blockchain that operated on "evidence of stake" because 2020.

The 'Merge': How a one enhance is established to alter the cryptocurrency field

Christopher Hutton

August 28, 07:00 AM August 28, 07:00 AM

One of the world's premier cryptocurrencies is about to go as a result of an immense transform with ramifications for the complete technological know-how.

Ethereum, the next most-made use of cryptocurrency in the world, is expected to go via a big specialized transform in September regarded as the "Merge." The update is years in the making and will refine the currency's procedure. It has important implications for the political and environmental position of the cryptocurrency field.

"It really is modifying the motor as the car is driving," Ben Edginton, the world products lead at the blockchain software package company Consensys, instructed the Washington Examiner.

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The "Merge" will change the managing of tokens in the Ethereum system. If a person wanted to be included in producing or transacting Ethereum just before the "Merge," they would do so by way of a method recognized as "proof of get the job done." The "evidence of perform" technique has customers "mine" the forex by getting a computer method a sequence of algorithms in competitors with other personal computers to gain Ether, the tokens applied by the Ethereum blockchain, which is the ledger of transactions maintained on line by customers.

The "proof of do the job" course of action is applied by most crypto-related blockchains but consumes a huge total of vitality and has been the subject matter of scrutiny by regulators in New York and elsewhere. The "Merge" would enable diminish that vitality intake by swapping Ethereum from "proof of function" to "evidence of stake" by a merging of the most important Ethereum blockchain with the Beacon chain, a independent blockchain that Consensys aided start in 2020.

"Evidence of stake" results in Ethereum by obtaining buyers set up "validators," which are parts of application that aid method transactions on Ethereum. Validators demand people to hold a minimum of 32 ETH — or $54,000 worth of forex (as of Thursday). An algorithm selects validators randomly to "mine" cash and validate a related block. This approach would decrease power consumption considerably due to the fact it no longer requires the competing miners to be on-line regularly.

"By moving to 'proof of stake' and executing absent with a proof of work mechanism that is way too electrical power-intensive, you might be minimizing the electrical power demand," Invoice Hughes, the senior counsel and director of global relations at Consensys, told the Washington Examiner. A shift to "evidence of stake" could save 99.5% of the electrical power consumed by the Ethereum blockchain, in accordance to an estimate from the Ethereum Basis.

This "Merge" has been talked about for numerous a long time. Ethereum creator Vitalik Buterin wrote about "proof of stake" in a 2014 blog post just before the forex arrived into existence, and he has been earning initiatives to pursue the "Merge" for at the very least two yrs. The most noteworthy hard work was the creation of the Beacon chain, a separate blockchain from the most important Ethereum cryptocurrency that ran on "proof of stake," in 2020. Consensys has been concerned in the operation of Beacon because its inception and has operate numerous exams to ensure that the chain will run without the need of any issues.

What continues to be unclear is no matter if the "Merge" will affect attempts by lawmakers to regulate the cryptocurrency sector. Hughes claimed that various lawmakers had approached him in search of information and facts about the "Merge." Even so, other analysts you should not see several reasons for regulators to take motion about the protocols that run Ethereum. "Specified the broad vary of apps and use situations that a protocol like Ethereum supports, we foresee that coverage and regulatory attempts will target the application layer, rather than the protocol layer," Sumedha Deshmukh, a plan expert at the Crypto Council for Innovation, explained to the Washington Examiner. "We're seeing this technique in proposed legislation all around the earth."

The Ethereum Basis declared that the computer software update necessary for the "Merge" would be implemented on Sept. 6. Edginton has been concerned in preparing for the "Merge" and statements that the update is expected to go seamlessly and to have minimal results on any transactions that may perhaps happen throughout the update course of action. The update is the to start with in a five-phase update to the Ethereum protocol that Buterin hopes will maximize scalability and shift Ethereum towards getting much more than a monetary software.

Elon Musk suggests he will proceed supporting Dogecoin

Daniel Chaitin

June 19, 03:58 AM June 19, 04:08 AM

Tesla CEO Elon Musk says he will adhere by Dogecoin inspite of the cryptocurrency's value plummeting because final 12 months and a $258 billion lawsuit more than an alleged Dogecoin pyramid scheme.

The tech billionaire, who is engaged in a $44 million Twitter acquisition, tweeted about his stance on Dogecoin early Sunday morning. "I will keep supporting Dogecoin," Musk mentioned. And then to a tweet that stated, "Keep shopping for it then," he responded, "I am."

Dogecoin, a cryptocurrency launched in 2013 which options a Shiba Inu pet meme, strike a peak of about 74 cents in May perhaps of last year. Musk has embraced Dogecoin, but a promote-off took put that exact same thirty day period immediately after a "Saturday Night Live" sketch in which Musk said the coin was "a hustle." The worth of Dogecoin has since dropped to about 5 cents, climbing just a small bit about the time of Musk's tweets early Sunday.

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The rate of Dogecoin briefly jumped in January immediately after Musk declared Tesla would accept the cryptocurrency for some merchandise. SpaceX, a spaceflight company also operate by Musk, was accepting Dogecoin as payment for an impending mission to the moon, CNBC described in May well 2021, and a calendar year later Musk mentioned SpaceX would quickly sign up for Tesla in accepting Dogecoin for items buys. Musk, Tesla and SpaceX, had been sued in federal court in Manhattan final week for $258 billion. The plaintiff, Keith Johnson, seeks a class motion lawsuit boasting a racketeering scheme to falsely buzz Dogecoin as a legit expenditure.

Early Saturday early morning, Musk responded to a tweet from Dogecoin co-creator Billy Markus, who shared his "motivation" for the cryptocurrency: that "persons basically use it for a little something further than pump and dump bulls*** so it has a reason to exist," and "the neighborhood understands what crypto is and what the crypto marketplace is and is aware that it is all kinda dumb and has fun with it."

"Tesla and SpaceX merch, it's possible a lot more down the road," Musk said.