Kategorie: Crypto Business

• Swyftx cuts 90 jobs as the cryptocurrency winter continues to affect more companies.

• The company follows exchanges like Coinbase, Bybit, and Kraken in reducing its employee headcount to cope with the bear market.

• Swyftx admitted that it grew too fast, and the bear market is now affecting its operations.

Swyftx becomes the latest crypto exchange to cut jobs

Australian crypto exchange Swyft, announced on Monday, December 5th, that it has cut 90 jobs. This represents 45% of the company’s total workforce, as the company has around 200 employees.

This latest cryptocurrency news comes as several companies find ways to cope with the bear market. In its blog post, Swyftx pointed out that even though it doesn’t have any direct exposure to FTX, its operations have been affected by the fallout FTX has caused in the crypto markets. The company wrote;

“Today, we’ve announced the hardest decision Angus and I have had to make in our careers. We’re saying goodbye to 90 talented friends and colleagues. As we’ve just announced to the team, Swyftx has no direct exposure to FTX, but we are not immune to the fallout it has caused in the crypto markets. As a result, we have to prepare in advance for a worst-case scenario of further significant drops in global trade volumes during H1 next year and the potential for more black swan-type events.”

Swyftx added that its business is uniquely well-positioned to weather events like FTX. Despite the robustness of its business, FTX’s collapse has affected the broader crypto market, and Swyftx also felt it. 

The cryptocurrency exchange added that its priority is to emerge from the current market in a position of strength. This will happen by managing operating costs to ensure its continued financial strength and to keep the confidence and trust of its customers.

Crypto companies continue to struggle in the bear market

Swyftx’s announcement comes a few hours after  Bybit, one of the leading crypto exchanges in the world, announced that it is set to cut 30% of its workforce. Bybit explained that the move is to ensure that the company survives the ongoing bear market. 

Coinbase and Kraken are some of the crypto exchanges that also reduced their workforce earlier this year. 

Swyftx admitted that it grew too fast. The company recorded massive growth earlier this year, but the bear market and the recent FTX collapse have affected its operations in recent months. 

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• PEGA Pool is set to launch next year and will become the first eco-friendly Bitcoin mining pool in the world.
• PEGA Mining is focused on reducing the environmental effects of Bitcoin mining.
• Clients that join the “Early Access” waiting list would benefit from a permanent 50% reduction in pool fees.

PEGA Pool will become the first eco-friendly Bitcoin mining pool 

PEGA Pool is set to become the first eco-friendly Bitcoin mining pool and is expected to launch next year.

PEGA Pool, a platform dedicated to reducing the environmental effects of Bitcoin mining, is expected to launch in 2023. The project focuses on making Bitcoin mining eco-friendly.

PEGA Pool is owned and operated by PEGA Mining, a UK-based cryptocurrency mining firm. 

According to the development team, PEGA Pool will focus on reducing bitcoin mining’s carbon footprint to create a more sustainable and eco-friendly industry. On its official website, the company said it would plant trees to help reduce the Bitcoin mining carbon footprint.

PEGA Pool is currently in the pre-launch phase and will be open to the public in Q1 2023. Clients can join the early access waiting list until launch. The team added that the PEGA Pool is open to all bitcoin mining clients regardless of their renewable energy usage.

PEGA Pool added that for clients that mine with non-renewable energy, it would use a portion of their pool fees to plant trees to help offset their mining carbon footprint. Clients that use renewable energy to mine cryptocurrencies will enjoy certain incentives. 

For instance, clients that mine with renewable energy will enjoy a 50% reduction in pool fees. Furthermore, pool fees are 2% for non-renewable energy clients and 1% for renewable energy clients.

Clients that join the early access waiting list will enjoy certain benefits

The use of non-renewable energy to mine Bitcoin is a subject that gained wide coverage over the past few years. Companies like Tesla had to suspend accepting Bitcoin as a payment method due to concerns over its carbon footprint during mining. However, the company said it intends to start accepting Bitcoin as a payment option for its vehicles again in the future. PEGA’s effort toward ensuring eco-friendly Bitcoin mining could be what is needed to convince Tesla to start accepting BTC payments again. 

With PEGA Pool currently in its pre-launch phase, the team said clients that join the “Early Access” waiting list would benefit from a permanent 50% reduction in pool fees.

PEGA Pool said it had planted 41,715 trees so far, for an estimated annual CO2 offset of 1111T. According to their official website, the team said PEGA Pool was built by miners and is run by miners. With years of experience in the crypto mining sector, the team understands what it is that miners need in order to be successful and profitable.

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FTX’s bankruptcy proceedings continue, and the company has now asked a judge to allow it to hire BitGo to secure its assets.

Bankrupt crypto exchange FTX has notified a federal judge that it wants to hire BitGo to safeguard the remainder of its digital assets as bankruptcy proceedings play out.

BitGo is a leading institutional custody firm.

The cryptocurrency exchange signed a custodial agreement with BitGo n November 13, a day after someone completed unauthorised transfers draining $372 million worth of assets from the company’s accounts. 

FTX and its various affiliates currently seek the consent of the judge overseeing its bankruptcy before moving assets. This latest cryptocurrency news means that FTX wants to ensure the safety of its assets. 

The crypto exchange told the court during yesterday’s hearing that it was concerned about theft and cyber threats. Hence, the reason it wants to move its assets to BitGo. 

Per the terms of the deal, FTX will pay a $5 million upfront fee to BitGo. The crypto custody firm will also charge FTX a monthly fee equal to the average U.S. dollar value of the digital assets it stores, multiplied by 1.5 basis points.

FTX lawyers revealed in the filing that it would cost the company around $100,000 per month, based on the initial transfer of $740 million worth of assets to BitGo. The crypto exchange added that it would continue to investigate and attempt to recover lost or stolen assets as the bankruptcy proceedings continue. 

The FTX lawyers added that recovering funds stolen from the exchange could increase the number of assets in custody. In a message to The Block, co-founder and CEO of Bitgo Mike Belshe said;

“It’s time to get serious about ending the human-created disasters in crypto. When you break down FTX subsidiaries, the ones that used BitGo products are solvent and safe. The ones that didn’t, aren’t.”

Any objection to the custodial services agreement is due by December 7th. The next FTX bankruptcy heading in the United States Bankruptcy Court for the District of Delaware will take place on December 16th.

In an interview with Coinjournal earlier this year, Ben Chan, CTO of BitGo, revealed that the company is focusing on custody this year as they seek to improve and strengthen its position in custodial services.

However, BitGo is also planning to offer other financial services soon, with Chan revealing that the company is interested in decentralised exchange. 

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Crypto lending platform Genesis is currently struggling and could be in need of investors to enable it to maintain its operations.

Cryptocurrency exchange Binance will not invest in Genesis, according to a recent report by the Wall Street Journal.

The report revealed that the cryptocurrency lending platform sought investment from Binance, the world’s leading cryptocurrency exchange. However, Binance turned down the opportunity to invest in the company owned by the Digital Currency Group.

The WSJ report added that Binance turned down the opportunity over a potential conflict of interest with Genesis’ business model. Furthermore, Genesis also sought investment from Apollo Global Management. However, it remains unclear if Genesis will receive the funds it needed from the asset management firm.

This latest cryptocurrency news comes roughly a week after Genesis suspended redemptions and new loan origination on its platform. 

Today Genesis Global Capital, @GenesisTrading’s lending business, made the difficult decision to temporarily suspend redemptions and new loan originations.

— Digital Currency Group (@DCGco) November 16, 2022

At the time, Genesis said;

“This decision was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion. The impact lies with the lending business at Genesis and does not affect Genesis’s trading or custody businesses. Importantly, this temporary action has no impact on the business operations of DCG and our other wholly owned subsidiaries.”

Genesis assured its users that it would continue to offer over-the-counter trading for spot and derivatives trading in addition to its custody services. 

Despite Binance turning down a chance to invest in Genesis, a company spokesperson told The Block that Genesis doesn’t plan to file for bankruptcy soon. The spokesperson said;

“We have no plans to file bankruptcy imminently. Our goal is to resolve the current situation consensually without the need for any bankruptcy filing. Genesis continues to have constructive conversations with creditors.”

Genesis’s announcement to suspend redemptions affected Gemini, another leading crypto exchange. At the time, Gemini said its Earn program would not be able to meet customer redemptions within the service-level agreement of five business days.

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The collapse of FTX and Alameda Research hasn’t affected the USDT stablecoin, thanks to Tether’s issuance policy.

Tether, the company issuing the USDT stablecoin, has revealed that the recent collapse of the FTX exchange and its Alameda Research hedge fund, doesn’t have a negative impact on its ecosystem.

According to Tether’s latest blog post, the company’s issuance policy protects it from Alameda’s failure. Alameda Research is one of the leading issuers of the USDT stablecoin.

Tether explained that its USDT stablecoins are issued when institutional parties send USD to Tether. The company issues the USDT on a 1:1 basis corresponding to the amount of USD sent to Tether. 

Tether added that it converts the USD into reliable, liquidity and conservative collateral ( US Treasuries, etc.). This implies that all USDT stablecoins are fully collaterised by Tether’s reserves, and every USDT can be redeemed 1:1 with USD.

As a large issuer of USDT, Alameda Research sent Tether USD, and Tether issues USDT. The USD from Alameda Research remains in Tether’s custody, but they are not on Alameda’s balance sheet. The collateral backing Alameda’s USDT is not on Alameda’s balance sheet, Tether added. 

Tether revealed that Alameda can still redeem any USDT they have  USD via Tether’s redemption facility. The company further added that it doesn’t have any outstanding loans of USDT, of Tether’s reserves, or of any other funds whatsoever. Tether wrote that;

“The main problem countless other companies are facing is that they recklessly lent Alameda various assets relying on extremely illiquid collateral. Since Alameda cannot repay those loans at this time, those companies have a hole in their balance sheet. This is not how USD₮ issuance works and is not behavior Tether engaged in with Alameda in any way.”

Tether also clarified its lending process. The stablecoin issuer said the only time it engages in lending is when it is based on over-collaterisation with extremely liquid assets. 

Some cryptocurrency lenders, including Voyager Digital and Celsius, have been struggling in recent months. Binance US is preparing another bid to acquire Voyager Digital following FTX’s bankruptcy proceeding. 

Tether pointed out that it believes the approach of many lenders in this industry has been reckless, lending huge quantities of money, and accepting FTT (and other illiquid assets) and pinky swears as collateral. 

Despite the struggles of some companies like Alameda Research and Celsius, Tether said its operations were not disrupted. 

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