CBX Weekly Newsletter // 01 May 2019
⦁ Bitfinex and Tether being accused of $850 million cover-up
⦁ Bitfinex is planning to issue an Exchange Token
⦁ Nasdaq adds XRP to Global Data service
⦁ ICOs in UAE are the biggest winners in 2019
Bitfinex and Tether being accused of $850 million cover-up
The New York Attorney General’s office today accused iFinex Inc., the company that owns both cryptocurrency exchange Bitfinex and the infamous stablecoin Tether (USDT), of losing around $850 million in customer funds. The attorney general claims that Tether is not even backed 1-to-1 by U.S. dollars (as the company has claimed numerous times) and that Bitfinex may not be able to cover customer withdraws.
According to the Wall Street Journal, approximately 80% of all cryptocurrency trades are done against Tether. If this escalates into something serious, The markets will react accordingly.
“Bitfinex has already taken at least $700 million from Tether’s reserves.”
The US Attorney General Letitia James said: “Our investigation has determined that the operators of the ‘Bitfinex’ trading platform, who also control the ‘tether’ virtual currency, have engaged in a cover-up to hide the apparent loss of $850 million dollars of co-mingled client and corporate funds.”
Tether has been accused in the past of not being truly backed 1-to-1 to the US dollar and manipulating the price of Bitcoin and the cryptocurrency market, this accusation brings even more speculation due to the fact that the company has refused to be audited by an external firm numerous times.
Some users of Bitfinex have claimed that their accounts have been frozen and that they cannot withdraw funds from the platform, this fuels the argument that the company is not solvent, as many other users keep withdrawing funds from their accounts.
Bitfinex claimed that the $850 million lost, had actually been “seized” by various authorities and that it was working to retrieve the funds.
Bitfinex is planning to issue an Exchange Token
According to a shareholder of Hong Kong-based exchange Bitfinex, the company is planning on issuing its own proprietary exchange token.
Dong Zhao, a famous crypto trader in China who owns a stake in Bitfinex, said that even though all the details are not fully confirmed, the exchange is indeed planning on releasing it anytime soon.
It’s not clear yet what the use case of this token will be, although this news came out just after the allegations from the New York General Attorney claiming Bitfinex of losing $850 million of customer and company’s funds.
According to Zhao’s Weibo account, he said that the exchange should use the new exchange tokens to pay back the $850 million back to the affected clients if that was the case.
Nasdaq adds XRP to Global Data service
New Zealand-based blockchain data and research firm Brave New Coin announced that it will partner with Stock Exchange operator Nasdaq to add another cryptocurrency index, this time it will show the third largest cryptocurrency in the market XRP.
Specifically, the XRP Liquid Index (XRPLX) which will offer a reference rate for the price of XRP, quoted in U.S. dollars, taking the spot price of Bitfinex, Bitstamp, Poloniex, and Kraken.
Brave New Coin partnered with Nasdaq during the beginning of 2019 to add indices for Bitcoin (BTC) and Ethereum (ETH) to its global data service.
The new stream will be available on the Nasdaq Global Index Data ServiceSM (GIDS)
ICOs in UAE are the biggest winners in 2019
According to CoinSchedule statistics, Initial Coin Offerings ICOs in the UAE have reached over $210 million so far in 2019, accounting for 25% of the global ICO market. The two largest projects are investment bank GCBIB and the other is the integrated investment group Bolton Holding Group, which raised $142 million and $67.8 million, respectively.
We believe that Blockchain projects can achieve outstanding results in UAE, due to the support of the UAE government for blockchain technology and cryptocurrencies. CBX, the largest cryptocurrency exchange in the Middle East region is also thriving in such an open and active environment and will embrace more collaborative projects in the future.
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