Those of us eagerly awaiting a summer relief rally for Bitcoin (BTC) may have to wait a bit longer. The bear market is still cleaning out our excesses – and revealing the most toxic players in our industry. I have told you about Terra, Celsius, Three Arrows Capital, BlockFi – And Digital Voyager? The crypto broker filed for Chapter 11 bankruptcy this week, putting hundreds of thousands of creditors on alert.
This week’s Crypto Biz newsletter dissects Voyager’s bankruptcy proceedings and offers some potentially good news regarding Celsius. We also look at the latest high-profile miner to force sell his Bitcoin and chronicle new capital raises from one of China’s most prominent venture firms.
Celsius repays $143 million in DAI loans since July 1
Celsius appears to be inching closer to paying off its outstanding debt to the Maker protocol after the cryptocurrency lender booked $142.8 million worth of Dai (DAI) stablecoins over a four-day period. Celsius returned another $34.4 million in DAI on July 5, effectively increasing its collateralization ratio and significantly lowering its settlement price below $3,000 worth of Bitcoin (BTC). In other words, the price of Bitcoin would now have to drop below $3,000 for Celsius to default on its loan. Although some observers took the news as cautious optimism that Celsius is headed in the right direction, the firm hasn’t issued any new updates in weeks and user withdrawals remain frozen since June 13.
Voyager Digital files for bankruptcy and proposes a recovery plan
Another one bites the dust: Cryptocurrency broker Voyager Digital filed for Chapter 11 bankruptcy in New York’s Southern District Court just days after the company halted all trading. Voyager’s bankruptcy filing stated that the company owed more than 100,000 creditors between $1 billion and $10 billion in assets. If you’re a Voyager account holder, there may be a silver lining: The company is filing for bankruptcy as part of a “reorganization” plan that should pave the way for customers to regain access to their accounts. Cryptocurrency market contagion is a real thing, and it may not be over yet.
As part of this process, the proposed Plan of Reorganization would resume account access and return value to customers. Under this Plan, which is subject to change given ongoing discussions with other parties, and requires Court approval:
— Stephen Ehrlich (@Ehrls15) July 6, 2022
As part of this process, the proposed Plan of Reorganization would resume access to accounts and return value to customers. Under this Plan, which is subject to change due to ongoing discussions with other parties, and requires Court approval.
Core Scientific sold $167 million worth of Bitcoin holdings in June
The capitulation of the miners is upon us. Earlier this week, United States cryptocurrency mining operation Core Scientific revealed that it was forced to sell more than 7,000 BTC in June to pay for ongoing trading expenses. Digital gold was dumped at a median price of $23,000, down 67% from Bitcoin’s all-time high last November. The good news is that miners selling is often considered a reliable indicator of the bottom. But, fewer investors are prepared to call the fund as the Federal Reserve plans several more aggressive interest rate hikes this year.
JUNE 2022 HIGHLIGHTS:
-1,106 #bitcoin self mined,
-10.3 EH/s self-mined
-+180,000 ASIC servers in operation
-7.6 EH/s co-location (hosting)
-Daily self-mining increased by 14% from June 1 (34.8) to June 30 (39.8)https://t.co/KeypwtMEfr
—Core Scientific (@Core_Scientific) July 5, 2022
HIGHLIGHTS OF JUNE 2022:
-1,106 #Bitcoin automined,
-10.3 EH/s automined
-+180,000 ASIC servers in operation
-7.6 EH/s collocation (hosting)
-Daily self-mining increased 14% from June 1 (34.8) to June 30 (39.8)
Crypto investor Sequoia Capital China reportedly raised $9 billion
In the depths of crypto winter, at least one venture capital firm continues to add to its war chest. Sequoia Capital China, the Chinese subsidiary of cryptocurrency-focused venture firm Sequoia Capital, is reportedly raising $9 billion for four startup funds. Although details remain scarce, it was reported that 50% of the proceeds were oversubscribed. How the funds will be deployed remains to be seen, but since Sequoia China has already backed blockchain games like Babel Finance and DeBank, we can expect blockchain and crypto startups to be well represented.
Do not miss it. What is the current state of the cryptocurrency market?
Is the bear market affecting your psyche? How long until we hit bottom, or have we already? In this week’s Market Report, I sat down with fellow analysts Jordan Finneseth, Yashu Gola, and Benton Yaun to discuss the current state of the crypto market and why July is going to be a pivotal month for risk assets. You can watch the full replay below.
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