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FTX Collapses While 75% of Bitcoin Investors Have Lost Money

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Study Finds 75% of Bitcoin Investors Have Lost Money

According to a study published Monday, roughly 75 percent of people who purchased bitcoin lost money as the cryptocurrency sector reels from the collapse of FTX, which has sapped confidence.

Economists at the Bank of International Settlements, widely regarded as the central bank of central banks, examined data on cryptocurrency investors in 95 countries between 2015 and 2022.

“Overall, back-of-the-envelope calculations indicate that roughly three-quarters of users have lost money on their bitcoin investments,” the researchers wrote in their study.

During the study period, the price of bitcoin increased from $250 in August 2015 to nearly $69,000 in November 2021. It is now worth around $16,500.

During the same time period, the number of people using smartphone apps to buy and sell cryptocurrencies increased from 119,000 to 32.5 million.

“Our analysis has revealed that, globally, bitcoin price increases have been linked to increased entry by retail investors,” the researchers wrote.

Furthermore, they discovered that “as prices rose and smaller users bought bitcoin, the largest holders (the so-called ‘whales’ or ‘humpbacks’) sold, making a profit at the expense of the smaller users.”

The researchers lacked direct data on individual investors’ gains and losses. However, they were able to extrapolate based on the price of bitcoin when new investors began using cryptocurrency trading apps and the roughly $20,000 it was worth last month.

The study also discovered that men under 35, commonly identified as the most “risk-seeking” segment, made up roughly 40% of new cryptocurrency investors.

Researchers discovered that most cryptocurrency investors viewed it as a speculative investment and that young men were more active in trading in the months following a significant increase in the bitcoin price.

According to them, the increase in investors following price increases should raise questions about whether more consumer protection is required.

Regulators Circle FTX

Following the spectacular collapse of a cryptocurrency exchange last week, regulators launched investigations. On Monday, FTX and rival exchanges sought to reassure nervous investors about their own stability, weighing on cryptocurrencies.

The collapse of FTX, once a crypto industry darling with a $32 billion valuation as of January, has prompted investigations by the US Justice Department, the Securities and Exchange Commission, and the Commodity Futures Trading Commission, according to a source familiar with the investigations.

According to a second source with knowledge of the investigation, the SEC investigation is also targeting FTX executives, their knowledge of handling customer funds, and any potential violations of securities laws.

While the crypto industry has marketed digital assets as fundamentally different from traditional finance, the sector has proven to be vulnerable to the same risks and should be subject to the same regulations, according to Federal Reserve Vice Chair Lael Brainard on Monday.

“Crypto finance, because it is no different than traditional finance in terms of the risks that it exposes,” she told Bloomberg in an interview, echoing a long-held belief.

Separately, the Fed’s top regulatory official, Michael Barr, hinted on Monday that stricter oversight of cryptocurrencies is on the way. This includes “safeguards” to ensure crypto companies follow the same rules as other financial firms, according to Barr’s written testimony released ahead of his appearance before the Senate Banking Committee on Tuesday.

The committee’s Democratic chairman, U.S. Senator Sherrod Brown, spoke out.

“My focus has always been on the crypto industry’s fraud, scams, volatility, and outright theft,” he said. “FTX’s bankruptcy and numerous other recent instances of insecurity have demonstrated why we require a comprehensive regulatory approach that protects consumers.”

Study Finds 75% of Bitcoin Investors Have Lost Money, FTX Collapses

FTX Files for Bankruptcy

On Friday, FTX filed for bankruptcy in one of the most high-profile crypto meltdowns after frenzied traders withdrew $6 billion from the platform in 72 hours and rival exchange Binance abandoned a rescue deal.

According to a New York Times interview published on Monday, FTX’s former CEO, Sam Bankman-Fried, said his company had grown too quickly.

Bitcoin fell below $16,000 early Monday before recovering to trade at $16,401, up 0.56% at 5:56 p.m. EST (2256 GMT).

The sudden demise of FTX, once a saviour for struggling crypto firms, sent shockwaves through the crypto industry, bracing for more damage.

LedgerX LLC, an FTX subsidiary, withdrew its December request to the Commodity Futures Trading Commission to offer products that are not fully collateralized on Monday.

BlockFi, a cryptocurrency lender, said it has significant exposure to FTX after signing a deal with it to provide it with a $400 million revolving credit facility with an option to buy it for up to $240 million.

Other cryptocurrency exchanges have published details of their reserves and promised additional disclosures to calm investor nerves amid unverified rumours.

Kris Marszalek, CEO of Singapore-based crypto exchange Crypto.com, which made headlines in 2021 with a $700 million deal to rename Los Angeles’ Staples Center the Crypto.com Arena, refuted suggestions that the company was in trouble.

Study Finds 75% of Bitcoin Investors Have Lost Money, FTX Collapses

Missing Money

Marszalek stated in an “ask-me-anything” YouTube Livestream that the exchange always kept reserves to match every coin customers held on its platform and that an audited proof of Crypto.com’s reserves would be published within weeks.

The move came after investors took to Twitter over the weekend to question a $400 million ether token transfer to the Gate.io exchange on Oct. 21.

On Sunday, Marszalek tweeted that the ether had been recovered and returned to the exchange, but the Wall Street Journal reported that withdrawals at Crypto.com had increased over the weekend.

A Crypto.com spokesperson declined to comment whether the platform’s outflows continued on Monday.

Crypto.com is one of the top ten exchanges in turnover worldwide, but it is smaller than FTX and market leader Binance.

On Sunday, Kraken, another cryptocurrency exchange, announced on Twitter that it had frozen the accounts of FTX, affiliated crypto trading firm Alameda Research, and their executives.

“We have actively monitored recent developments with the FTX estate, are in contact with law enforcement, and have frozen Kraken account access to certain funds we suspect to be associated with FTX-related ‘fraud, negligence, or misconduct,” a Kraken spokesperson said.

Changpeng Zhao, the CEO of Binance, the world’s largest cryptocurrency exchange, stated that he plans to establish an industry recovery fund to assist projects that are “otherwise strong but in a liquidity crisis.”

Binance signed a nonbinding letter of intent to buy FTX’s non-US assets last week but backed out, causing the company to go bankrupt. Zhao has since issued a warning about a “cascading” cryptocurrency crisis.

Geoff Thomas is a seasoned staff writer at VORNews, a reputable online publication. With his sharp writing skills and deep understanding of SEO, he consistently delivers high-quality, engaging content that resonates with readers. Thomas' articles are well-researched, informative, and written in a clear, concise style that keeps audiences hooked. His ability to craft compelling narratives while seamlessly incorporating relevant keywords has made him a valuable asset to the VORNews team.

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California Representative Adam Schiff urges Biden to relinquish his position.

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Adam Schiff
Justin Sullivan/Getty Images/Getty Images North America

(VOR News) – According to a statement that was obtained by National Public Radio (NPR), Representative Adam Schiff, a Democrat from California, is urging that Vice President Joe Biden withdraw from his candidacy for re-election.

Adam Schiff’s request was received by NPR. When the comment was first reported, it was done so by The Los Angeles Times.

Schiff, who is currently running for Senate in California, issued a statement in which he encouraged Vice President Joe Biden to “pass the torch” and “secure his legacy of leadership” by allowing Democrats to have the opportunity to convincingly defeat Donald Trump.

Adam Schiff is currently running for Senate in California.

A statement by Adam Schiff to the media noted that “Joe Biden has been one of the most consequential presidents in our nation’s history, and his lifetime of service as a Senator, Vice President, and now as President has made our country a better place.”

Adam Schiff noted in his statement to the media. On the other hand, our nation is present at a critical crossroads at the moment.

If Donald Trump were to win a second term as president, the entire framework of our democracy would be thrown into disarray, and I have serious concerns about whether or not the President would be able to defeat Donald Trump in the upcoming election in November.

To this day, Adam Schiff is the most prominent Democrat who has advocated for Biden to resign from the campaign for vice president nomination.

The Biden campaign made reference to the events that Biden has been holding this week in response to a request for a statement from the campaign.

As part of his efforts to promote his candidacy, he is currently taking part in a meeting in Las Vegas with members of the Congressional Black and Hispanic caucuses.

Vice President Biden has declared on several occasions that he will not be withdrawing from the campaign and that he is certain that he is the most competent candidate to shepherd the party through the election. He has also stated that he is confident that he will serve as the party’s nominee.

Further, Adam Schiff stated that President Biden is fully responsible for making the decision, and that he will support the party’s nominee, regardless of who that may be.

In addition, Adam Schiff said he would not support any other candidate.

According to statements made by Vice President Biden over the course of the past few days, he has acknowledged that members of his party are continuing to question him.

“The story goes that [former President Harry] Truman said, if you want a friend in Washington, get a dog,” Vice President Joe Biden quipped during the annual convention of the National Association for the Advancement of Colored People (NAACP) in Las Vegas.

The NAACP is an organization that works to provide opportunities for people of color. “After the last couple of weeks, I know what he means.”

Schiff’s comment comes at a time when there is a renewed push from anxious Democrats for Biden to resign. Adam Schiff’s statement comes at a time when all of this is happening.

Due to the fact that President Trump was the target of an attempted assassination during a rally that took place on Saturday in Pennsylvania, the calls came to a temporary halt.

As a result of the seeming energy and confidence that Republicans displayed during the Republican National Convention, Democrats are growing increasingly anxious. This is despite the fact that that is the case. In addition, recent polls have demonstrated that support for Biden is exhibiting a downward trend.

In a virtual roll call vote that may take place several weeks before the Democratic National Committee’s convention, which will begin on August 19 in Chicago, the DNC is getting ready to officially name Biden the party’s nominee. The convention will take place in Chicago.

This preparation has resulted in an increase in the level of frustration that has been experienced over the past several days.

SOURCE: NPR

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Elon Musk Says He’s Moving SpaceX And X Out Of California

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spacex musk

Elon Musk has announced that he is relocating his firms out of California.

In two posts on X Tuesday, the billionaire announced that SpaceX’s headquarters will be relocated from Hawthorne, California, to Starbase, Texas, a business town under construction in the state’s south. He also said that social media platform X would be moving from San Francisco to Austin, Texas.

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Elon Musk | CNN

Elon Musk Says He’s Moving SpaceX And X Out Of California

Musk said the SAFETY Act, a bill signed by California Gov. Gavin Newsom that prohibits school districts from mandating instructors to notify parents if a child wishes to be labeled as a different gender, was “the final straw.”

“Because of this law and the many others that preceded it, attacking both families and companies, SpaceX will now move its HQ from Hawthorne, California, to Starbase, Texas,” Musk told X.

In 2022, one of Elon’s daughters asked a California court to accept her new name and gender, claiming she no longer wanted to be related to her famous and affluent father “in any way, shape or form.” Musk has faced criticism for several of his statements on X addressing gender identification issues.

In a follow-up tweet, Elonstated that he was tired of the violent criminality surrounding the building where X is located in San Francisco.

Elon Musk Says He’s Moving SpaceX And X Out Of California

Elon has been drawn to Texas for several years. SpaceX moved to relocate its corporate incorporation from Delaware to Texas in February following a Delaware state judge’s ruling that Elon’s 2018 Tesla pay package was exorbitant, siding with a shareholder who challenged it.

Elon announced 2021 that Tesla would relocate its headquarters from the Bay Area to Austin, Texas. In December 2020,Elon announced that he had relocated to Texas.

SOURCE | CNN

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European Union Court Says TikTok Owner Can’t Avoid Bloc’s Law Cracking Down On Digital Giants

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tiktok
Tiktok | AP

LONDON —ByteDance, the owner of TikTok, cannot evade the bloc’s assault on digital giants, according to a European Union court decision issued Wednesday. The video sharing platform falls under new legislation that also applies to Apple, Google, and Microsoft.

The EU’s General Court rejected ByteDance’s legal challenge to being classified as an online “gatekeeper” subject to additional requirements under the Digital Markets Act of the 27-nation union.

tiktok

Tiktok | PixaBay Image

European Union Court Says TikTok Owner Can’t Avoid Bloc’s Law Cracking Down On Digital Giants

The guideline, also known as the DMA, went into effect this year to counter Big Tech corporations’ dominance and make online competition more equitable by providing consumers with more choices.

TikTok has contended that it was not a gatekeeper but a new social media contender, taking on established giants such as Facebook and Instagram owner Meta.

However, the judges found that since 2018, TikTok had “succeeded in increasing its number of users very rapidly and exponentially” and “rapidly consolidated its position, and even strengthened that position over the following years.”

“We are disappointed with this decision,” the business wrote in a prepared statement. “TikTok is a challenger platform that provides important competition to incumbent players.” TikTok stated that it will assess its future steps and has already implemented efforts to comply with the DMA.

tiktok

Tiktok | AP

European Union Court Says TikTok Owner Can’t Avoid Bloc’s Law Cracking Down On Digital Giants

The Digital Markets Act went into effect in March. It is a list of dos and don’ts for big tech “gatekeeper” businesses that aims to offer users more options but threatens significant penalties if they do not comply.

The verdict can be appealed to the EU Court of Justice, the bloc’s highest court, but only on legal grounds.

SOURCE | AP

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