What’s going on Listeners? Welcome to Crypto Unplugged 5-minute Friday Show.
Doc here on Friday 16th June. I hope you’re all well, wherever you’re listening from.
So, what ‘s been happening this week in the Crypto Space:
Well, in our first story this week:
U.S. prosecutors are maintaining the original eight charges against cryptocurrency entrepreneur Sam Bankman-Fried, with the trial scheduled for February 6, 2024 in New York.
This development opens the possibility for the Bahamas to bring forth their own charges against Bankman-Fried.
The charges against SBF which include market manipulation, wire fraud, and money laundering, were announced in November 2023.
The Department of Justice has stated that the Bahamas has the opportunity to approve Bankman-Fried's trial in the United States before deciding on their own charges.
Bankman-Fried's legal team previously sought to reduce the charges, arguing that some were redundant, and the courts ordered the severance of specific counts from the indictment.
Sam Bankman-Fried is the founder of FTX, a major cryptocurrency exchange.
Now, in another headline-making news story this week:
On June 15, an imbalance in Curve's 3pool, a stablecoin pool for decentralized finance, caused the weightage of USDT to rise above 70% instead of the ideal 33.3% comprising USDT, USDC, and DAI.
The deviation in the weightage of USDT in the pool led to a slight depegging of the Tether stablecoin from its US dollar value, with the price falling by 0.3% to around 0.997.
Traders reacted to the imbalance by selling USDT for DAI or USDC, resulting in increased concentration of USDT in Curve's 3pool, similar to a previous incident during the FTX collapse in November 2022.
The imbalance was caused by a whale address called CZSamSun, which borrowed a large amount of USDT and swapped it for USDC, leading to the deviation in USDT's value.
Tether's CTO, Paolo Ardoino, reassured the crypto community through Twitter that the depeg scare is not a cause for concern, stating that Tether is prepared to redeem any amount. He also shared a "FUD meme" and addressed market rumours surrounding Tether's depeg.
In another development:
CoinDesk has obtained legal documents through a Freedom of Information Law request, offering insights into Tether's banking relationships and its exposure to commercial paper, including its stablecoin USDT.
According to the documents, Tether, the issuer of USDT, kept its funds in several banks, investment management firms, gold depositories, its own sister company Bitfinex, and other entities in March 2021.
Tether also invested in commercial paper and securities issued by various entities, including major banks like Qatar National Bank, Barclays Bank, Deutsche Bank, Emirates NBD Bank, and Natwest Group. A significant portion of its issuers were Chinese banks and financial institutions.
These documents provide some insights into Tether's financial situation, which has been a controversial topic in the cryptocurrency industry, particularly concerning the backing of its stablecoin USDT.
The documents shed light on where Tether stores its assets, revealing its reliance on commercial paper, which wasn't widely known before.
Thanks for joining me and do tell your friends about crypto unplugged.
Have a great Friday and a lovely weekend and see you guys’ next time!