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Binance Sues Bloomberg Businessweek's Publisher for Defamation in HK

A Bloomberg media subsidiary in Hong Kong is under legal challenge and being sued for defamatory comments on an article published by the publication about Binance Chief Executive Changpeng Zhao (CZ).

This action comes after CZ filed a defamation lawsuit on Monday in Hong Kong High Court against Modern Media, as a publisher of the traditional Chinese-language edition of Bloomberg Businessweek, according to local media reports.

The lawsuit stems from Bloomberg‘s subsidiary Modern Media company undermining Zhao’s image in an article published on July 6 or the 250th issue. The original article title by the media outlet stated: “Can Crypto’s Richest Man Stand the Cold?” But the plaintiff indicated Bloomberg Businessweek‘s Chinese Edition context was inaccurate and portrayed Zhao as running a Ponzi Scheme.

According to Zhao’s legal representative, the headline design by Bloomberg’s Chinese subsidiary was aimed to promote hatred, contempt, and ridicule for the world’s richest crypto billionaire.

Zhao’s defence stated that Modern Media is an influential publication with a broad reach in Hong Kong. The publication damaged his public image within the crypto community and other business circles and caused distress and embarrassment.

Zhao, through his representatives, has asked Modern Media to withdraw the defamatory comments on the article and also requested a formal apology and compensation, including aggravated damages.

CZ has separately filed a motion for discovery against Bloomberg L.P. and Bloomberg Inc. in the U.S. District Court for the Southern District of New York for defamation stemming from the original profile piece in June.

This is not the first time CZ has taken matters to court against media publications to protect the image of his personal brand and that of Binance exchange.

In November last year, Binance sued Forbes Media LLC, alleging a story by reporter Michael del Castillo and contributor Jason Brett made false allegations about the cryptocurrency exchange. Binance sought to have Forbes pay damages and pull down the article.

In February this year, Binance voluntarily dropped the suit against the century-old business publication without any conditions. And within that month, Binance invested $200 million into 104-year-old publisher Forbes to boost the media company’s digital initiatives. The deal was part of a larger effort by Forbes to become a publicly-traded company.

Japan Reduces 30% Crypto Tax On Paper Earnings For Token Issuers

Even if they haven’t made a profit via the sale of their shares, Japanese crypto issuers are compelled to pay a predetermined corporation tax rate of 30% on their holdings under the current framework of the law.As part of its efforts to encourage expansion in the domestic financial and technology sectors, the government of Japan is planning to relax the tax criteria that must be met by local crypto businesses.Even if they haven’t made a profit via the sale of their assets, Japanese companies that issue cryptocurrency are compelled to pay a fixed corporation tax rate of thirty percent (30%) on the value of their holdings.As a result of this, a number of locally established crypto and blockchain enterprises, as well as talent, are said to have decided to establish themselves in other countries over the course of the last several years.The tax committee of Japan’s governing Liberal Democratic Party (LDP) met on December 15 and adopted a proposal that was previously introduced in August. The plan eliminates the need that crypto firms pay taxes on paper profits from tokens that they have issued and owned. It is anticipated that the more lenient crypto tax laws would be presented to parliament in January, and that they will become operational on April 1, the first day of the new fiscal year in Japan.In an interview with Bloomberg on December 15, LDP legislator and member of its Web3 policy office Akihisa Shiozaki remarked that this is a very major step forward and said that it would become simpler for a variety of enterprises to do business that includes the issuance of tokens.The most recent action taken by the government seems to indicate that despite the FTX debacle, it is still eager to promote and develop the domestic crypto and Web3 sector. Prime Minister Fumio Kishida emphasized in October that NFTs, blockchain, and the Metaverse will play important roles in the nation’s digital transformation.The global banking conglomerate Sumitomo Mitsui Financial Group (SMBC) said on the 8th of December that it is collaborating on a project to investigate the applications of soulbound tokens (SBTs).SBTs are a reference to a concept made by Vitalik Buterin, one of the co-founders of Ethereum, about the use of tokens to represent people’s digital identities.

Crypto Lender Struggles Extended Creditor Protection For Vauld

A troubled cryptocurrency lending platform known as Vauld has been given an additional term of creditor protection by a court in Singapore. Before February 28th, the business has to devise a strategy for its comeback.

According to a story that was published by Bloomberg on the 17th of January, Vauld has been given more than a month to conclude its discussions with one of the two digital-asset fund managers in order to take over the executive management of the tokens that are trapped on its platform. It would seem that the argument made by the corporation that the discussions had progressed to an advanced level was sufficient to convince the high court in Singapore.

The site stopped processing withdrawals for its 800,000 clients in July 2022, claiming poor market circumstances and an unusual amount of withdrawals totaling $200 million in less than two weeks as the reasons for the decision.

It was previously given a three-month moratorium to prepare a restructuring plan for the firm and offer a better result for its creditors in August of 2022. This was done in order to prevent the company from going bankrupt. The court at the time rejected the company’s request for a six-month protection period, expressing fears that a longer moratorium won’t have proper oversight and monitoring. The judge’s decision is still in effect.

As soon as the first moratorium went into effect, it became public knowledge that Nexo, a cryptocurrency lender with headquarters in Switzerland, planned to purchase Vauld along with all of its assets.

However, once the office of Nexo in Bulgaria was searched by the authorities, Vauld denied that a transaction of this kind could ever take place.

In August of 2022, the significant Singapore-based platform Zipmex was given a ban that would last for three months so that it could resolve liquidity concerns.

The future of cryptocurrency lending in the nation is still unknown due to a proposal by the central bank of Singapore to prohibit digital payment token service providers from extending any credit facility to customers. This proposal would apply to both fiat and cryptocurrency lending.

The UAE's Minister of State for Foreign Trade Thani Al-Zeyoudi

Thani Al-Zeyoudi, the minister of state for international trade of the United Arab Emirates, has predicted that cryptocurrency would play a “significant role” in the country’s participation in global commerce in the future.

Al-Zeyoudi provided a number of updates regarding the United Arab Emirates’ trade partnerships and policies heading into 2023 during an interview with Bloomberg that took place on January 20 in Davos, Switzerland, which is the location where world leaders are currently gathered for the 2023 World Economic Forum.

In his remarks pertaining to the cryptocurrency industry, the minister claimed that “crypto will play a big role for UAE commerce moving ahead,” and he went on to emphasise that “the most important thing is that we establish global regulation when it comes to cryptocurrencies and crypto enterprises.”

Al-Zeyoudi went on to suggest that as the UAE works on its crypto regulatory regime, the focus will be on making the Gulf country a hub with crypto-friendly policies that also have sufficient protections in place: “We started attracting some of the companies to the country with the aim that we’ll build together the right governance and legal system, which is needed.” [Translation:] “We started attracting some of the companies to the country with the aim that we’ll build together the right governance and legal system,

Al-remarks Zeyoudi’s come less than a week after the UAE Cabinet adopted a new regulation, which, in essence, ensures that entities engaging in crypto activities must secure a licence and approval from the Virtual Asset Regulatory Authority. Al-remarks Zeyoudi’s come as a result of recent developments in the cryptocurrency market (VARA).

Under the terms of the new legislation, businesses who fail to comply risk incurring penalties of up to $2.7 million.

This action adds to the “Guiding Principles” for the regulation and supervision of digital assets that were released in September by the financial regulator of Abu Dhabi’s Global Market free economic zone.

The principles lay forth a welcoming attitude toward cryptocurrencies while also making a commitment to comply with international norms on anti-money laundering (AML), countering the funding of terrorism (CFT), and supporting financial sanctions.

In addition, Omar Sultan Al Olama, Minister of State for Artificial Intelligence and the Digital Economy of the United Arab Emirates, participated in a panel discussion at the World Economic Forum on January 19 that was centred on cryptocurrency.

Al Olama made the point that while the FTX scandal was a significant cause for worry, the United Arab Emirates (UAE) still intends to operate as a hub despite all that has transpired.

According to him, the fact that crypto firms choose the UAE to be their home is unquestionably a good thing.

The minister also distanced the United Arab Emirates from accusations that its towns, like as Dubai, tend to become major sites for discredited crypto personalities to run to. He said that “bad actors don’t have a country and don’t have a destination.”

However, he did emphasise that governments do need to collaborate in order to prevent bad actors from fleeing the country and going on the run internationally.

“They are there in every single place.

You will see them in the Bahamas, you will see them in New York, and you will see them in London. What we need to do as governments is work together, and we need to work with the industry as well, to ensure that if someone does something wrong, he can’t move from one place to the other, and you will see them there “he said.

BlockFi to Sell $160 Million in Bitcoin Mining Machine

It would appear that the now-defunct cryptocurrency loan business BlockFi intends to dispose of debts worth approximately $160 million that are guaranteed by approximately 68,000 Bitcoin mining machines as part of the processes for the company to file for bankruptcy protection. These debts are backed by the Bitcoin mining machines themselves.

According to a report that was made public on January 24 by Bloomberg, two people who were characterised as being “familiar with the matter” indicated that BlockFi began the process of getting rid of the debts the previous year. This information was cited in the article.

The cryptocurrency lender submitted their petition for protection from creditors under Chapter 11 of the United States Code in the month of November. The failure of the lending company was attributed, at least in part, to the large exposure it had to the cryptocurrency exchange FTX, which has since closed its doors.

However, the sources claim that some of these loans have already been defaulted on since then, and due to the decline in the price of Bitcoin mining equipment, it is possible that they are undercollateralized. The reports indicate that the day of the 24th of January is the last day that potential loan bidders have until the end of the day to bring in their applications for the financing that is now available.

According to Dell, the fact that debt collection agencies were purchasing the loans for “cents on the dollar” showed that it was likely these agencies that were engaging in the bidding process for the loans. The bidding procedure for the loans is described as “cents on the dollar.”

In addition, he said that the administrators of BlockFi are probably capable of collecting “nothing more” from these assets apart from the cash that was given to them. This was in reference to the debt that was owing to them.

FTX investors file class-action suit against Sequoia

According to reports, users of the now-defunct cryptocurrency exchange FTX have taken aim at financiers who marketed the platform, arguing that their efforts provided a “air of legitimacy” to the now-defunct exchange in a situation that has been described as “tricky” by a cryptocurrency attorney.

According to a story that was published by Bloomberg on February 15th, FTX investors had filed a class-action lawsuit on February 14th against the venture capital company Sequoia Capital as well as the private equity companies Thoma Bravo and Paradigm.

The investors said that the companies were promoting “their own investments” in FTX, which amounted to hundreds of millions of dollars.

It was stated that the companies participated in a promotional marketing campaign in 2021, which the investors said gave the discredited cryptocurrency exchange a “air of credibility.”

The three companies were all investors in FTX’s $900 million Series B round, which took place in July 2021. This was the biggest raise in the history of cryptocurrency, and individual partners at each of the three companies spoke favorably of former FTX CEO Sam Bankman-Fried at the event.

Matt Huang, one of the co-founders of Paradigm, issued a statement in the wake of the fundraising announcement in July 2021, in which he referred to Bankman-Fried as a “unique” entrepreneur who is “stunningly ambitious.”

He went on to say that despite the fact that Sequoia did not do its due diligence to a particularly high standard, the company is not “liable to others.”

The fact that there is no evidence to imply that Sequoia wasn’t “playing within the regulatory guidelines” led Hennessy to assume that it was a matter of “buyer beware.”

According to a separate report published by Bloomberg on February 15, it was revealed that in the same court filing, Sam Bankman-Fried and his father, along with former executives of FTX and Alameda Research named Caroline Ellison, Nishad Singh, and Gary Wang, were all served with a subpoena, which is an order compelling a person to appear in court in order to provide additional evidence.

It was said that Sam Bankman-Fried is likely to show up in court on February 17, while Joseph Bankman, Ellison, Wang, and Singh are scheduled to appear in court on February 16.

US Congress needs to take control of crypto legislation

According to Kristin Smith, CEO of the Blockchain Association, a prominent U.S. crypto industry nonprofit, the United States Congress needs to take control of crypto legislation and make it a more “open process” where the entire marketplace is looked at “comprehensively.” This recommendation comes from Smith, who serves as the president of the Blockchain Association.

During an interview with Bloomberg on February 22, 2019, Smith said that the cryptocurrency business need U.S. politicians to lead crypto legislation, despite the fact that this would make the process “extremely long.” In the meanwhile, regulators will “step in.”

Smith mentioned that despite regulators “moving very quickly,” progress on legislation is happening “behind closed doors,” implying that it is essential for more industry involvement in a “open process,” which would involve Congress. He said this to suggest that it is vital for more industry involvement in a “open process.”

Smith is of the opinion that “very particular facts and circumstances” are at the root of the problem with legislators taking the lead on legislation via enforcement actions and settlements.

She stated that it is a tough situation for Congress to be in at the present due to the fact that many people in Washington, D.C. who “were close” to the former FTX CEO Sam Bankman-Fried and FTX feel “burned” and “betrayed” over the collapse of the cryptocurrency exchange in November 2022.

Smith is optimistic that stablecoin legislation will soon be implemented in the United States because, according to Smith, Congress has been looking into it “since 2019” and “the work has been done.” She said that it “came close” to occurring the year before, just before to the failure of FTX.

She went on to say that the dangers associated with cryptocurrencies are distinct from those associated with conventional financial services, and that as a result, regulators need to spend more time looking at market regulation and “tailor to those risks.”

Smith suggested that stablecoin and “market side” regulation should be a higher priority than focusing on legislating crypto-related criminal activity, saying that public ledgers make it “much more transparent” than what we see in the traditional financial system. This idea stemmed from Smith’s assertion that stablecoins and “market side” regulation were more important than focusing on legislating crypto-related criminal activity.

This comes after the chief policy officer of the Blockchain Association, Jake Chervinsky, took to Twitter on February 15 to state that regardless of how many enforcement actions the Securities and Exchange Commission and the Commodity Futures Trading Commission bring, they are “bound by legal reality.” Chervinsky also stated that “neither” has the authority to “comprehensively regulate crypto.” This news comes after Chervinsky made these statements.

Binance CEO Denies Bloomberg's Net Worth Report

Changpeng “CZ” Zhao, the CEO of Binance, one of the world’s biggest cryptocurrency exchanges, has refuted the net worth stated by Bloomberg in its financial rich list. Bloomberg included Zhao on its list of the world’s richest people in finance. With an estimated wealth of $28.2 billion, CZ is positioned among the top three financial billionaires in the world, as shown by the ranking. On the other hand, CZ said on Twitter on April 27 that the statistics are all incorrect and that he does not have anywhere near as much money as what is supposed to have been the case for him, notwithstanding what was previously stated.

CZ began his tweet with the number 4, meaning that his worth should fall somewhere between Dan Gilbert’s $19.4 billion and Uday Kotak’s $13 billion. Uday Kotak is the richest person in India. It should not come as a surprise that CZ would take the initiative to call attention to the falsehoods that have been reported, given that he has been critical of the way that the cryptocurrency business is portrayed by mainstream media sites. He has made a number of denials about the information that was provided by authoritative sources such as Bloomberg and Forbes, often labeling such stories as FUD, which stands for fear, uncertainty, and doubt.

CZ’s critical position on the industry’s depiction in mainstream media was clear in his reaction to a story published by Forbes, which said that Binance had proceeded with a “backroom maneuver” involving a $1.8 billion transaction in 2022. The article claimed that Binance had done this in order to circumvent regulatory oversight. It was his contention that Forbes “don’t know how an exchange works.” In a similar manner, he disproved a story from Bloomberg that said Binance was contemplating severing connections with its US-based business partners.

In addition to correcting certain errors that had been made in the article, CZ said in his tweet that he does not consider the defunct FTX bitcoin exchange to be a competitor of his company’s. He emphasized the need of better-run exchanges in the cryptocurrency market and expressed his satisfaction with the increasing number of well-run exchanges in the sector.

The cryptocurrency market is receiving a growing amount of attention from the mainstream media as a result of stories detailing its enormous growth potential and adoption by institutional investors. Nevertheless, CZ’s criticism of the mainstream media draws attention to the need of truthful reporting on the innovations and evolution of the business.

CZ’s rejection of Bloomberg’s net worth report and his critical attitude on the depiction of the cryptocurrency sector in mainstream media both underscore the need of factual reporting. In conclusion, CZ’s position on the representation of the cryptocurrency industry in mainstream media is crucial. Reporting that is well-informed and provides a fair picture of the innovations and progress of the industry is required because of the growth potential of the sector and the rising usage of its products.

Bloomberg: FTX Bankruptcy Triggers 30% Profit Margin Drop for Crypto Market Makers

According to Bloomberg’s report dated September 5, 2023, liquidity providers Auros, GSR Markets Ltd., and Wintermute Trading Ltd. have disclosed that the bankruptcy of the FTX exchange has led to a 30% reduction in profit margins for crypto market makers. “The FTX debacle was a wake-up call for the industry,” commented Le Shi, head of trade at Auros.

In the wake of the FTX bankruptcy, market makers are re-evaluating their risk profiles and are advised to diversify their operations and store their digital assets away from trading platforms. Auros further elaborated that using intermediary services for collateral storage contributes to a 20%-30% decline in profitability, compared to leveraging coins directly on a trading site.

Meng Hwee Neo, managing director of trading and Singapore co-head at GSR Markets, told Bloomberg that market makers are increasingly focusing on Bitcoin and Ether in a “flight to quality” strategy. While this shift may result in slimmer profit margins, it offers greater volume and business opportunities.

CCData statistics, as cited by Bloomberg, reveal that monthly spot trading volumes on centralized crypto exchanges have plummeted 74%, dropping to $445 billion in August 2023 from $1.1 trillion in January 2022.

Market-making firms like Jane Street Group and Jump Crypto are retreating from the digital asset market due to low trading volumes, increased volatility, and heightened U.S. regulatory scrutiny on exchanges such as Binance Holdings Ltd. and Coinbase Global Inc.

The repercussions of FTX’s insolvency extend beyond market makers to encompass nearly all entities in the crypto sector. BlockFi’s CEO, whose company also went bankrupt, previously admitted to disregarding advice from their risk management experts on lending assets to Alameda Research and FTX.

BC Technology Group Shares Drop 30%, Company Clarifies OSL Sale Rumor

BC Technology Group Limited, a leading digital asset and fintech firm listed on the Stock Exchange of Hong Kong (SEHK), issued a clarification announcement regarding unusual share price movements and misinformation circulating about the sale of its virtual asset trading platform, OSL.

On 17 October 2023, BC Technology Group observed a drastic dip in its share prices, plummeting close to HK$3, marking a daily decline of about 30%. The company swiftly responded with a public announcement stating the board had conducted reasonable inquiries concerning the abnormal price and trading volume fluctuations, finding no apparent reason for such market behavior.

A report surfaced on 16 October 2023 from Bloomberg, suggesting BC Technology Group was contemplating the sale of its cryptocurrency trading platform, OSL, with an alleged valuation of HK$1 billion (US$128 million). This news was based on anonymous insider sources claiming that potential buyers had expressed interest and that the firm might only sell part of the OSL business, not the entire operation.

The board of BC Technology Group categorically denied the allegations, labeling the Bloomberg article as “factually inaccurate and highly misleading.” They emphasized that no such considerations were being made, urging shareholders and potential investors to exercise caution when dealing in the company’s shares.

The mid-year financial report of BC Technology Group demonstrated a narrowing net loss of HK$95 million for the six months ending June 2023, significantly down from over HK$300 million during the same period in the previous year. The company highlighted that OSL’s digital asset and blockchain platform operations remain its primary revenue source, albeit with a nearly 50% reduction in digital asset trading volume on OSL to HK$112.6 billion in the first half of 2023 compared to the same timeframe in 2022.

Despite the market’s reaction, BC Technology Group maintains a transparent communication stance, dispelling rumors swiftly to uphold its market integrity. The misinformation surrounding the OSL sale, as per the board, has no basis in reality and aims to provide clarity to its stakeholders amidst turbulent market conditions.