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Caroline's WILD Testimony: $100M in Bribes to Chineses Officials and More

Plus Onyx has been activated

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Nathaniel Whittemore
October 12, 2023

The Breakdown First Five - Thursday October 12, 2023

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Japan Bank Freeze

Over one million customers across 11 Japanese banks suffered through a two day payment outage blamed on a glitch. The issue was deep in the payments infrastructure and arose from routine update work on a relay computer. The Japan Post bank also suffered issues with its online systems. The issue has now been resolved. This was the first major outage since the system went into operation in 1973. Perhaps after 50 years it's time for an overhaul.

4. SEC Update on Rulemaking

The SEC have updated the court on their progress on crypto rulemaking and have vanishingly little to speak of. The regulator was ordered to provide an update on their progress in July after Coinbase filed a petition. At the time, Coinbase said the SEC had decided not to do anything but wouldn’t state that publicly. The update says that staff provided a recommendation to the Commission on Tuesday but does not elaborate.

3. ARK Updates ETF Application

ARK/21 Shares have updated their spot Bitcoin ETF application seemingly in response to SEC concerns. Bloomberg analysts have called this a “good sign” of progress and a step on the way to approvals. They expect other ETF applicants to update shortly. Changes include sections on custody, money laundering and environmental risk, which seem like they could only possibly be addressing specific concerns raised by the regulator.

2. Onyx Activated

JPMorgan have activated their tokenized collateral network operating on the private Onyx blockchain system. The system has completed its first transaction, involving clients Blackrock and Barclays. Blackrock used the system to tokenize money market fund shares before transferring them to Barclays for use as collateral in an OTC trade. The network allows clients to move collateral near instantly, freeing capital currently used in day long clearing processes.

1. Caroline Breaks Down

Alameda CEO Caroline Ellison burst into tears during her second day of testimony as she recounted the “worst week” of her life when FTX collapsed. She expressed sympathy for victims but also relief that the lies were over. Caroline also explained an insane story of $1B in frozen funds. After using the identities of two Thai prostitutes to try to sneak the money out of the exchanges, Alameda ended up paying over $100M in bribes to Chinese officials. Allegedly.

Thanks for reading -NLW