Bitcoin and other crypto majors are holding pretty steady as we head towards the end of the first week in 2023 for crypto. Meanwhile Celsius users have received a shock and crypto-contagion fallout fears continue to surround Digital Currency Group (DCG).
Let’s talk about Celsius first.
Judge decrees US$4b of assets will stay with Celsius
Users of the once-very-popular-now-bankrupt crypto-lending platform Celsius have been given some unwelcome news from a serious-looking bloke in a wig in the US.
Per a report from The Defiant, Chief US Bankruptcy Judge Martin Glenn has decreed that more than US$4 billion in crypto deposited in the platform’s “Earn Accounts” do not actually belong to the 600,000 or so customers who made the deposits.
Celsius halted withdrawals from its crypto-yield-generating platform in June last year, citing “extreme market conditions” and filed for a Chapter 11 bankruptcy in July.
The ruling states that the assets instead belong to Celsius’s estate. And that’s because, reasoned Judge Glenn, Celsius’s terms of use states that the company held “all right and title to such Eligible Digital Assets, including ownership rights.”
Something most people aren’t aware of is that traditional banks are exactly the same. When you deposit money you are legally loaning that money to said bank and if the shit hits the fan that money is technically not yours
— JPK (@moccaobe) January 5, 2023
“If the cryptocurrency assets in the Earn Accounts are owned by [Celsius], the Account Holders are unsecured creditors, and their recovery depends on the distributions to unsecured creditors under a confirmed chapter 11 plan, or under the Bankruptcy Code’s priority rules in the event of liquidation,” wrote Glenn in the ruling.
“A fundamental principle of the Bankruptcy Code is equality of distribution. There simply will not be enough value available to repay all Account Holders in full,” added Glenn.
It really is a cruel world.
New York AG sues former Celsius CEO Alex Mashinsky
But hang on a sec, perhaps all is not lost for all Celsius Earn users. New York Attorney General Letitia James is on the case for hapless investors, having now filed a lawsuit against Alex Mashinsky, co-founder and former CEO of Celsius Network.
James noted that she’s “suing to get New Yorkers their money back and ban Mashinsky from doing business in New York.”
For all the other global Celsius users who have their funds in limbo, let’s hope any success the AG achieves extends beyond the state of New York.
I’m suing the former CEO of cryptocurrency platform @CelsiusNetwork for defrauding investors out of billions of dollars.
Alex Mashinsky lied to people about the risks of investing in Celsius, hid its deteriorating financial condition, and failed to register in New York.
— NY AG James (@NewYorkStateAG) January 5, 2023
I’m suing to get New Yorkers their money back and ban Mashinsky from doing business in New York.
We will continue to protect people from the risks of investing in cryptocurrency.
— NY AG James (@NewYorkStateAG) January 5, 2023
Top 10 overview
With the overall crypto market cap at US$852 billion, as flat as the Nullabor since this time yesterday, here’s the current state of play among top 10 tokens – according to CoinGecko.
Not a lot to report regarding the crypto majors since this time yesterday, so let’s check in with some prominent Twitter-based chart watchers and see what they have to say…
We give you Dutch trader and analyst Michaël van de Poppe, who’s reasonably positive for a relief rally while highlighting the potential crypto-contagion risk surrounding Grayscale/DCG/Genesis:
We should be good if #Bitcoin remains above $16.6K.
Tricky weekend coming up with Grayscale, tomorrow unemployment data and such.
Wouldn’t go crazy on leverage.
— Michaël van de Poppe (@CryptoMichNL) January 5, 2023
Meanwhile, are the bears starting to pivot? Not necessarily, but US trader “Roman Trading” for instance, who was pretty bearish on Bitcoin’s price action for the vast majority of 2022, had this to say:
Everyone on my Twitter feed saying $BTC to go down.
I’m not saying the bottom is in but flocking opposite the herd has worked well for me.
Bearish set up on $USDT.D for confluence with $BTC DB on 1D.
Send crypto higher.#bitcoin #cryptocurrency #cryptotrading #cryptonews
— Roman (@Roman_Trading) January 5, 2023
Then there’s Australian-born New Yorker Bob Loukas – a trader with more than 25 years’ experience and a Bitcoin-investing OG. He seems to also be seeing a potentially significant relief rally on the cards.
I try to stay away from these types of tweets, because people take them as absolutes and then trade them that way.
And not to mention, we don’t know “exactly” when the cycle starts or does right before.Mentioning b/c it’s a solid signal in my study.
— Bob Loukas (@BobLoukas) January 5, 2023
Uppers and downers: 11–100
Sweeping a market-cap range of about US$6.6 billion to about US$289 million in the rest of the top 100, let’s find some of the biggest 24-hour gainers and losers at press time. (Stats accurate at time of publishing, based on CoinGecko.com data.)
DAILY PUMPERS
• Chiliz (CHZ), (market cap: US$598 million) +7%
• eCash (XEC), (mc: US$480 million) +6%
• BitDAO (BIT), (mc: US$453 million) +5%
• Monero (XMR), (mc: US$2.8 billion) +3%
• Axie Infinity (AXS), (mc: US$780 million) +2%
DAILY SLUMPERS
• Huobi (HT), (market cap: US$751 million) -11%
• Ethereum Classic (ETC), (market cap: US$2.5 billion) -5%
• Casper Network (CSPR), (mc: US$304 million) -5%
• NEXO (NEXO), (mc: US$396 million) -4%
• Arweave (AR), (mc: US$333 million) -4%
BREAKING: Huobi shut down internal employee communication groups and feedback channels.
What’s going on at @HuobiGlobal
— Garlam (@GarlamWON) January 5, 2023
Around the blocks
Some pertinence and randomness that stuck with us on our morning moves through the Crypto Twitterverse…
This does NOT sound good regarding DCG – the world’s largest digital assets manager. Perhaps it needs to hurry up and collapse so we can finally begin to get through the other side of the ongoing Terra and FTX-related crypto contagion.
Scoop: Genesis parent company Digital Currency Group just shut down its $3.5 billion wealth management division as the crypto contagion continues. https://t.co/lI7TdnWdsg
— Kate Clark (@KateClarkTweets) January 5, 2023
Still, this is perhaps slightly better news. Depending on what you think about BlackRock, of course.
Breaking!
BlackRock adds #Bitcoin to its list of assets for its Global Allocation Fund.
It’s far from dead.
— Michaël van de Poppe (@CryptoMichNL) January 5, 2023
Any time you think you’re having a bad day, think back to this poor lady. https://t.co/PufD1AuF7U
— David “JoelKatz” Schwartz (@JoelKatz) January 5, 2023
