PURE $PECULATION
Ben Bernanke Says He Doesn't See Value in Bitcoin
Stephen Alpher
Mon, May 16, 2022
Former U.S. Federal Reserve Chairman Ben Bernanke told CNBC on Monday that he doesn't believe bitcoin (BTC) works as money, a store of value or digital gold.
"If bitcoin were a substitute for fiat money, you could use bitcoin to go buy your groceries," he said. "Nobody buys groceries with bitcoin because it’s too expensive and too inconvenient to do that." he added, noting how it would be impossible to price something like celery in bitcoin because there's too little stability in its value.
Occasionally known as "Helicopter Ben" for suggesting in 2002 that the Fed could simply drop money from helicopters to ward off deflationary conditions – a comment the cypherpunks who laid the groundwork for Bitcoin were no doubt well aware of – Bernanke addressed the digital gold case for bitcoin. "Gold has underlying use value," he argued. "You can use it to fill cavities. The underlying use value of a bitcoin is to do ransomware or something like that."
Turning to monetary policy, Bernanke, who was behind the original zero interest rate policy and quantitative easing, criticized the current Fed for not moving quickly enough to tighten monetary policy in the face of advancing inflation.
Under even a "benign scenario," Bernanke said he expects the economy to slow and unemployment to rise, even as inflation remains high. "You could call it stagflation," he said.
Luna Foundation Guard says its Bitcoin reserves are down to 313 from over 80,000, and it will use ‘remaining assets’ to pay back ‘smallest’ stablecoin holders
Taylor Locke
Mon, May 16, 2022, 8:09 AM·1 min read
The Luna Foundation Guard (LFG), an organization that supports the Terra ecosystem, shared a breakdown of its remaining assets on Monday.
Last week, Terra’s stablecoin UST began to crash far below $1, and its sister token Luna unraveled to nearly zero. Amid the chaos, many investors were wondering where LFG’s billions worth of Bitcoin went, which it originally obtained to defend UST’s peg.
Now, after days of silence, LFG shared that it has 313 Bitcoin left, down from its original 80,394 Bitcoin reserve. LFG also noted it has a few other assets, including UST, Terra and Avalanche.
LFG is “looking to use its remaining assets to compensate remaining users of $UST, smallest holders first,” it tweeted on Monday. “We are still debating through various distribution methods, updates to follow soon.”
Over the weekend, figures in the crypto community also suggested Terra disburse funds to “smallholders” impacted by the crash. Among them is Ethereum co-founder Vitalik Buterin.
“Coordinated sympathy and relief for the average UST smallholder who got told something dumb about ‘20% interest rates on the US dollar’ by an influencer, personal responsibility and SFYL [or sorry for your loss] for the wealthy,” Buterin tweeted on Saturday.
He added that the “obvious precedent is FDIC insurance,” being “up to $250,000 per person.”
UST remains in the red, down 71% in the last week. It’s currently trading at 8 cents. Luna, down 100% in the last week, is worth nearly zero.
This story was originally featured on Fortune.com
Crypto: Stablecoin storm spreads after billions of tether is cashed out
Brian McGleenon
Tue, May 17, 2022,
A smartphone with Tether logo on it. Reuters/Dado Ruvic/Illustration
Crypto's stablecoin storm spreads as $7.6bn of USD tether is redeemed in the past week. The cashout looks likely to continue on Tuesday with impact on all major tokens including bitcoin.
On Tuesday the top two cryptocurrencies by market cap, bitcoin and ethereum, rallied 3% in 24 hours, with BTC at $30,667 and ETH at $2,091.
The cash-out of tether (USDT-USD) by crypto investors has escalated since the LUNA/UST crash last Wednesday.
The dramatic crash saw the algorithmic stablecoin UST terra, which had been pegged to the dollar one to one, fall to a low of $0.1.
A stablecoin is supposed to be a stable safe haven for investors to park their profits amid the volatility of the cryptocurrency market.
However, cryptocurrency investors now find they have nowhere to go amid signals of further volatility.
No stablecoin seems safe at the moment, and the only option is to hold blue-chip cryptos, such as bitcoin (BTC-USD) and ethereum, or cash out of the whole ecosystem into a traditional bank account.
The crisis deepens as ethereum, the second-biggest cryptocurrency by market cap, has fallen about 60% from its November record.
Read more: Crypto live prices
According to technical analyst John Roque of 22V Research, ethereum (ETH-USD) could drop another 80%.
Ethereum currently stands at $2,074, but Roque's downside target is around $420.
However, both bitcoin and ethereum have risen by around 3% in value in the last 24 hours, which would suggest wary cryptocurrency investors are parking their money in these blue chips until the current 'stablecoin' storm resides.
The market cap of tether has been dropping considerably since the blow-up of the USDT terra algorithmic stablecoin.
Tether's market cap has fallen from $85bn before the 'stablecoin storm', to a current value of $76bn
USDT, or tether, should not be confused with UST, called terra, which was the algorithmic stablecoin that crashed last Wednesday.
Unlike the UST terra algorithmic stablecoin, USDT tether is backed by US dollars as collateral.
However, its reserves are a point of controversy and only a fractional amount of the $4 of tether in existence may be redeemed for actual US dollars.
On Monday, the New York Supreme Court rejected Tether’s petition to block the public from receiving documents detailing the composition of its dollar reserves.
The recent crypto-market crisis involving stablecoins has caused industry experts to call for strong regulation, especially of stablecoins.
Read more: 'Crypto lobby groups are dictating terms in Washington'
Speaking to Yahoo Finance, London-based fintech investor Viktor Prokopenya said: “Regulation will bring transparency to the market and end bad practices. Like all young technologies - crypto is only about a decade old, the industry has to grow up and out of its existing ways.
"The recent collapse of terra and tether and other stablecoins have shown a lack of transparency and an ironic ‘instability’ in a supposedly more ‘stable’ cryptocurrency."
The news comes as the UK Treasury is en route to legalise the use of stablecoins.
Last month HM Treasury tweeted: "Economic Secretary John Glen announced today that stablecoins will be brought into UK payments regulation.
"This places the UK financial services sector at the forefront of technology, creating conditions for stablecoin issuers and service providers to operate and invest."
Luna Foundation Guard has now dumped $2.4 billion from its Bitcoin reserves in failed attempt to defend TerraUSD peg
Woohae Cho—Bloomberg via Getty Images
Christiaan Hetzner
Mon, May 16, 2022, 8:51 AM·3 min read
Luna Foundation Guard, the second largest known holder of Bitcoin, liquidated almost its entire reserves last week worth billions in a failed attempt to defend the Terra UST stablecoin peg.
Ever since the collapse of UST and its sister governance token Luna, designed to maintain the peg through an algorithmic process of manipulating the latter’s money supply, the entire crypto community wanted to know just one thing: what happened to LFG’s prodigious Bitcoin holdings?
“Where is all the BTC (Bitcoin) that was supposed to be used as reserves?“ asked Changpeng "CZ" Zhao, head of crypto platform Binance. “Shouldn’t those BTC be ALL used to buy back UST first?”
Chain analysis firm Elliptical tracked movements in LFG's Bitcoin, concluding they had all been shifted to centralized exchanges Binance and Gemini, where the trail promptly ran cold.
https://twitter.com/CryptoHarry_/status/1526130321942794240?s=20u0026t=9FoQrf42lfejQNhtB7Sj7Q
On Monday, the crypto community finally got an answer, when LFG posted an update to its 91,000-plus followers in a long Twitter thread.
Of the 80,394 Bitcoin worth $2.4 billion it held as of May 7th just prior to Terra losing its dollar peg, only 313 are still held in reserve.
The rest were liquidated between May 8th and May 10th, when Bitcoin traded between $31,000 and $35,000.
'Heartbroken about pain'
For investors in Bitcoin, this could be bullish as it removes uncertainty hanging over the price amid fears a whale as big as LFG would dump its holdings to defend the peg.
After LFG's Bitcoin holdings surpassed Elon Musk's Tesla earlier this month, only Michael Saylor's Microstrategy, with its 129,218 Bitcoin in reserves, was known to hold more.
On Monday, Bitcoin fluctuated around the $30,000 mark.
https://twitter.com/saylor/status/1525970665504907270?s=20u0026t=9FoQrf42lfejQNhtB7Sj7Q
For Luna holders, however, Monday’s update suggests there is little remaining value left in the project apart from roughly $65 million in Avalanche, another $12 million in Binance tokens and the remaining $9.4 million in Bitcoin.
Reserves totaled $93.4 million, according to the most recent information from LFG.
On Monday, Binance founder CZ said his platform had locked up, or "staked", about $12 million in UST to validate transactions on the Terra blockchain.
He said he would ask the Terra project team "to compensate the retails users first, Binance last, if ever," in order to make the bulk of small retail investors that lost money whole again.
For Do Kwon, whose wife recently received police protection, there was little left to do but claim neither he nor any affiliated institutions try to earn profits by selling Terra UST and Luna during the collapse.
The South Korean native had gained a reputation for hubris, mocking critics that pointed to fatal flaws in the construction of his algo stablecoin. Only two months ago, he boasted his creation would eliminate one of Terra UST’s competitors, Maker Foundation’s Dai.
“I am heartbroken about the pain my invention has brought on all of you,” the self-described “Master of Stablecoin” posted to Twitter on Saturday.
https://twitter.com/mrdistortion_/status/1524334361289629696?s=20u0026t=9BOB61eHSAha-ewaNRlDBA
This story was originally featured on Fortune.com
Taylor Locke
Mon, May 16, 2022, 8:09 AM·1 min read
The Luna Foundation Guard (LFG), an organization that supports the Terra ecosystem, shared a breakdown of its remaining assets on Monday.
Last week, Terra’s stablecoin UST began to crash far below $1, and its sister token Luna unraveled to nearly zero. Amid the chaos, many investors were wondering where LFG’s billions worth of Bitcoin went, which it originally obtained to defend UST’s peg.
Now, after days of silence, LFG shared that it has 313 Bitcoin left, down from its original 80,394 Bitcoin reserve. LFG also noted it has a few other assets, including UST, Terra and Avalanche.
LFG is “looking to use its remaining assets to compensate remaining users of $UST, smallest holders first,” it tweeted on Monday. “We are still debating through various distribution methods, updates to follow soon.”
Over the weekend, figures in the crypto community also suggested Terra disburse funds to “smallholders” impacted by the crash. Among them is Ethereum co-founder Vitalik Buterin.
“Coordinated sympathy and relief for the average UST smallholder who got told something dumb about ‘20% interest rates on the US dollar’ by an influencer, personal responsibility and SFYL [or sorry for your loss] for the wealthy,” Buterin tweeted on Saturday.
He added that the “obvious precedent is FDIC insurance,” being “up to $250,000 per person.”
UST remains in the red, down 71% in the last week. It’s currently trading at 8 cents. Luna, down 100% in the last week, is worth nearly zero.
This story was originally featured on Fortune.com
Crypto: Stablecoin storm spreads after billions of tether is cashed out
Brian McGleenon
Tue, May 17, 2022,
A smartphone with Tether logo on it. Reuters/Dado Ruvic/Illustration
Crypto's stablecoin storm spreads as $7.6bn of USD tether is redeemed in the past week. The cashout looks likely to continue on Tuesday with impact on all major tokens including bitcoin.
On Tuesday the top two cryptocurrencies by market cap, bitcoin and ethereum, rallied 3% in 24 hours, with BTC at $30,667 and ETH at $2,091.
The cash-out of tether (USDT-USD) by crypto investors has escalated since the LUNA/UST crash last Wednesday.
The dramatic crash saw the algorithmic stablecoin UST terra, which had been pegged to the dollar one to one, fall to a low of $0.1.
A stablecoin is supposed to be a stable safe haven for investors to park their profits amid the volatility of the cryptocurrency market.
However, cryptocurrency investors now find they have nowhere to go amid signals of further volatility.
No stablecoin seems safe at the moment, and the only option is to hold blue-chip cryptos, such as bitcoin (BTC-USD) and ethereum, or cash out of the whole ecosystem into a traditional bank account.
The crisis deepens as ethereum, the second-biggest cryptocurrency by market cap, has fallen about 60% from its November record.
Read more: Crypto live prices
According to technical analyst John Roque of 22V Research, ethereum (ETH-USD) could drop another 80%.
Ethereum currently stands at $2,074, but Roque's downside target is around $420.
However, both bitcoin and ethereum have risen by around 3% in value in the last 24 hours, which would suggest wary cryptocurrency investors are parking their money in these blue chips until the current 'stablecoin' storm resides.
The market cap of tether has been dropping considerably since the blow-up of the USDT terra algorithmic stablecoin.
Tether's market cap has fallen from $85bn before the 'stablecoin storm', to a current value of $76bn
USDT, or tether, should not be confused with UST, called terra, which was the algorithmic stablecoin that crashed last Wednesday.
Unlike the UST terra algorithmic stablecoin, USDT tether is backed by US dollars as collateral.
However, its reserves are a point of controversy and only a fractional amount of the $4 of tether in existence may be redeemed for actual US dollars.
On Monday, the New York Supreme Court rejected Tether’s petition to block the public from receiving documents detailing the composition of its dollar reserves.
The recent crypto-market crisis involving stablecoins has caused industry experts to call for strong regulation, especially of stablecoins.
Read more: 'Crypto lobby groups are dictating terms in Washington'
Speaking to Yahoo Finance, London-based fintech investor Viktor Prokopenya said: “Regulation will bring transparency to the market and end bad practices. Like all young technologies - crypto is only about a decade old, the industry has to grow up and out of its existing ways.
"The recent collapse of terra and tether and other stablecoins have shown a lack of transparency and an ironic ‘instability’ in a supposedly more ‘stable’ cryptocurrency."
The news comes as the UK Treasury is en route to legalise the use of stablecoins.
Last month HM Treasury tweeted: "Economic Secretary John Glen announced today that stablecoins will be brought into UK payments regulation.
"This places the UK financial services sector at the forefront of technology, creating conditions for stablecoin issuers and service providers to operate and invest."
Luna Foundation Guard has now dumped $2.4 billion from its Bitcoin reserves in failed attempt to defend TerraUSD peg
Woohae Cho—Bloomberg via Getty Images
Christiaan Hetzner
Mon, May 16, 2022, 8:51 AM·3 min read
Luna Foundation Guard, the second largest known holder of Bitcoin, liquidated almost its entire reserves last week worth billions in a failed attempt to defend the Terra UST stablecoin peg.
Ever since the collapse of UST and its sister governance token Luna, designed to maintain the peg through an algorithmic process of manipulating the latter’s money supply, the entire crypto community wanted to know just one thing: what happened to LFG’s prodigious Bitcoin holdings?
“Where is all the BTC (Bitcoin) that was supposed to be used as reserves?“ asked Changpeng "CZ" Zhao, head of crypto platform Binance. “Shouldn’t those BTC be ALL used to buy back UST first?”
Chain analysis firm Elliptical tracked movements in LFG's Bitcoin, concluding they had all been shifted to centralized exchanges Binance and Gemini, where the trail promptly ran cold.
https://twitter.com/CryptoHarry_/status/1526130321942794240?s=20u0026t=9FoQrf42lfejQNhtB7Sj7Q
On Monday, the crypto community finally got an answer, when LFG posted an update to its 91,000-plus followers in a long Twitter thread.
Of the 80,394 Bitcoin worth $2.4 billion it held as of May 7th just prior to Terra losing its dollar peg, only 313 are still held in reserve.
The rest were liquidated between May 8th and May 10th, when Bitcoin traded between $31,000 and $35,000.
'Heartbroken about pain'
For investors in Bitcoin, this could be bullish as it removes uncertainty hanging over the price amid fears a whale as big as LFG would dump its holdings to defend the peg.
After LFG's Bitcoin holdings surpassed Elon Musk's Tesla earlier this month, only Michael Saylor's Microstrategy, with its 129,218 Bitcoin in reserves, was known to hold more.
On Monday, Bitcoin fluctuated around the $30,000 mark.
https://twitter.com/saylor/status/1525970665504907270?s=20u0026t=9FoQrf42lfejQNhtB7Sj7Q
For Luna holders, however, Monday’s update suggests there is little remaining value left in the project apart from roughly $65 million in Avalanche, another $12 million in Binance tokens and the remaining $9.4 million in Bitcoin.
Reserves totaled $93.4 million, according to the most recent information from LFG.
On Monday, Binance founder CZ said his platform had locked up, or "staked", about $12 million in UST to validate transactions on the Terra blockchain.
He said he would ask the Terra project team "to compensate the retails users first, Binance last, if ever," in order to make the bulk of small retail investors that lost money whole again.
For Do Kwon, whose wife recently received police protection, there was little left to do but claim neither he nor any affiliated institutions try to earn profits by selling Terra UST and Luna during the collapse.
The South Korean native had gained a reputation for hubris, mocking critics that pointed to fatal flaws in the construction of his algo stablecoin. Only two months ago, he boasted his creation would eliminate one of Terra UST’s competitors, Maker Foundation’s Dai.
“I am heartbroken about the pain my invention has brought on all of you,” the self-described “Master of Stablecoin” posted to Twitter on Saturday.
https://twitter.com/mrdistortion_/status/1524334361289629696?s=20u0026t=9BOB61eHSAha-ewaNRlDBA
This story was originally featured on Fortune.com
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