Welcome to another series of Melegaswap's Weekly Crypto News Recap, where we bring you the most exciting stories from the world of cryptocurrency for the week (July 9th to 15th, 2023).

This week witnessed significant surges in leading cryptocurrencies, driven by the American SEC vs. Ripple (XRP) case's excitement. #XRP soared by over 70% in 24 hours, while #bitcoin (BTC) surpassed $31,000 and Ethereum (ETH) went above $2,000. 

Top stories include #CelsiusNetwork is facing a $4.7 billion fine from the US FTC. The allegations include misleading customers, misappropriating funds, and making unsecured loans. On top of that, CEO Alex Mashinsky is now facing fraud charges.

Over in South Korea, Terraform Labs' co-founder, Daniel Shin, is currently on trial for fraud. This is happening as his colleague, DO Kwon, is also in Montenegro, serving a 4-month jail term.

Amidst the controversies, there were some positive developments as well. Jacobi Asset Management successfully gave the green light for the launch of Europe's first Bitcoin ETF, providing investors with a new opportunity to enter the crypto market. In the United States, Representative Ritchie Torres has called for an investigation into the SEC's handling of digital assets, especially regarding its connections with Prometheum.

Meanwhile, a major victory for Ripple came in the form of winning a landmark case against the SEC. This triumph gave a huge boost to XRP, driving its value up by 70%. On the other hand, another leading crypto firm, LBRY Credits, lost against the SEC.

TOP CRYPTO NEWS RECAP: (JULY 9–15, 2023)

●      Celsius network receives $4.7 billion fine from the FTC

●      Terraform co-founder Daniel Shin's Trial unfolds in South Korea

●      Jacobi ETF becomes Europe's first step into Bitcoin exchange-traded funds

●      US Rep. Ritchie Torres demands an investigation of SEC's pact with Prometheum

●      XRP skyrockets as Ripple triumphs over #SEC in historic legal battle

●      A federal court ruled against LBRY Inc. in its lawsuit with SEC.

Celsius network receives $4.7 billion fine from the FTC

The Federal Trade Commission (FTC) has imposed a staggering $4.7 billion penalty on the bankrupt Celsius Network. The network's plans to return assets to consumers are now suspended. The FTC also banned Celsius and its affiliates from offering services related to cryptocurrency. 

As alleged, the network misled customers, misappropriated funds, and made $1.2 billion in unsecured loans. CEO Alex Mashinsky was indicted on seven fraud-related charges and taken into custody. This came as Celsius Network is facing similar charges from the Securities and Exchange Commission (SEC) and the CFTC.

Terraform co-founder Daniel Shin's trial unfolds in South Korea

Daniel Shin, co-founder of #TerraformLabs , is now on trial in South Korea, along with seven others linked to the collapsed company. Shin was indicted for fraud and violating capital markets laws, resulting in the freezing of $184 million worth of assets. This was in connection with the collapse of Terra-Luna, an algorithmic stablecoin launched by Terraform Labs, which caused a $40 billion cryptocurrency loss in 2022.

Shin's defense team requested more time to prepare for the trial due to the technical complexities involved. This happened as Shin's co-founder, Do Kwon, is serving a four-month jail sentence in Montenegro for attempting to flee with a fake passport.

Jacobi ETF becomes Europe's first step into Bitcoin exchange-traded funds

Jacobi Asset Management, a London-based firm, is ready to launch Europe's first Bitcoin exchange-traded fund (ETF) after a year-long delay. Originally scheduled for July 2022, the listing was postponed due to market conditions caused by the Terra ecosystem and FTX collapses. However, citing increased demand, Jacobi decided to move forward with the ETF launch.

Unlike other European digital asset products, the Jacobi Bitcoin ETF is a centrally cleared instrument backed by cryptocurrency, offering direct ownership to investors. Approved by Guernsey's Financial Services Commission in October 2021, the ETF can be traded outside the US.

US Rep. Ritchie Torres demands an investigation of SEC's pact with Prometheum

US Representative Ritchie Torres has called for an investigation into the United States Securities and Exchange Commission (SEC) over its handling of digital assets. Torres specifically questions the SEC's "sweetheart deal" with crypto platform Prometheum, emphasizes Prometheum's questionable status as a true trading platform, and demands scrutiny of the SEC's failure to establish a workable registration process.

He said that “[The] SEC is acting like an overzealous traffic cop, arbitrarily ticketing drivers while keeping the speed limit a secret.”

XRP skyrockets as Ripple triumphs over SEC in historic legal battle

In a landmark case, Ripple has defeated the SEC's allegations that its XRP token is an unregistered security. The cryptocurrency market responded with enthusiasm, particularly XRP, which surged over 70% on Thursday.

District Judge Analisa Torres ruled that while some transactions involving XRP constituted securities, the token itself did not meet the criteria for an investment contract. This much-anticipated decision led XRP to skyrocket from $0.4 to above $0.8, briefly hitting the fourth spot in market capitalization.

Ripple's triumph could have implications for other cryptocurrencies labeled as "securities."

A federal court ruled against LBRY Inc. in its lawsuit with SEC

The US District Court for the District of New Hampshire has issued its final judgment in the SEC v. LBRY case. LBRY, Inc. has been found liable for violating Section 5 of the Securities Act of 1933. As such, LBRY is permanently restrained from participating in unregistered crypto asset securities offerings. This came the same week another US court ruled in favor of Ripple (XRP).

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Chameleon (Chame)

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Celsius Network Files Lawsuit Against EquitiesFirst for $439M Recovery

Bankrupt #crypto2023 lender #CelsiusNetwork  has filed a complaint against EquitiesFirst Holdings, a lending company for asset recovery. As per a September 6 report, Celsius is seeking injunctive relief and a declaratory judgment for asset recovery from lender EquitiesFirst Holdings. The complaint filed names both EquitiesFirst and its CEO Alexander Christy as defendants. Apart from this, Celsius filed a summons on the same day, asking the private lender to submit a proposal or reply within 35 days. Let us tell you that EquitiesFirst is an Indianapolis-based private lending company, which owed $439 Million to Celsius Network till July 2022.

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Celsius has come up with a different idea for the people who use their services. They want to give them a chance to own a part of a new company. This new company will be supported with lots of money and won’t owe a big amount of money to others.

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On August 14, a crypto lending company called Celsius Networks, which is dealing with financial problems, got the permission from a judge to ask the people who use their service about a new idea. This idea is about paying back around $2 billion in Bitcoin and Ether to the users, but through a new company that the users themselves will own.

The judge, whose job is to decide things fairly, said that he will send out forms to the Celsius users so they can vote on this idea. These forms will have clear explanations of what the company wants to do to give the users their money back.

Judge Glenn wants to make sure everything is clear before saying “yes.” He wants to know more about how the crypto world’s ups and downs might affect Celsius. He’s also curious if there could be any problems with the company’s crypto-mining activities.

People who are owed money by Celsius have different opinions. Some are not happy with the plans for paying them back, and they’ve said so. Other people who gave money to Celsius have raised questions about the plans too.

Celsius Networks’ New Plan and Future Hopes

A company called Celsius Networks, which is having money troubles, came up with a plan to pay back the people it owes. Another group named Arrington Capital and a team called Fahrenheit LLC, which took over Celsius when it went through some problems earlier, are leading this plan.

The idea is that the people who should get paid back will get a part of a new company instead of money. This new company will take care of Celsius’ activities like mining crypto and handling things like big loans and investments, including a lot of valuable cryptocurrencies. The court papers say that if this plan goes through, people who lent money to Celsius might get back more than 85 cents for every dollar they’re owed.

This new company is supposed to have a lot of money and not owe too much. It might also become the first company that owns a good amount of both Bitcoin and Ethereum and is listed on the stock market. Plus, the plan says that the people who are owed money might also get around $2 billion worth of special crypto tokens.

Celsius’ lawyer, Chris Koenig, says they’re working hard to start paying people back by the end of 2023. But the judge, who makes sure things are fair, says there’s still more to do in this situation.

Celsius Creditors Raise Concerns

At a meeting, the people who use Celsius were not happy with how the company plans to pay them back, says Bloomberg. They don’t like the idea of getting shares in a new project that’s not very clear. Some customers even want their CEL tokens returned. They don’t agree with the company’s thought that each CEL token is worth 25 cents.

But the judge, who makes decisions, said that the customers won’t get those CEL tokens back. This is because the Securities and Exchange Commission, a group that makes sure things are fair in finance, said CEL tokens are like stocks in a company. When a company has money problems like Celsius, these stocks usually become less valuable. The judge explained that CEL tokens can’t be given back because they depended on how much Celsius was worth. He also said that after the money trouble is settled, Celsius won’t be around anymore.

Just a while back, the person in charge of Celsius, Alex Mashinsky, was accused of doing some dishonest things and messing with the value of CEL tokens to make them look better.

Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.

#CryptocurrencyNews #NFT #Web3 #Blockchain #CelsiusNetwork

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The bankrupt cryptocurrency lender, Celsius Network, has taken legal action against EquitiesFirst Holdings in a bid to recover assets, as stated in a bankruptcy court document filed on Wednesday.

EquitiesFirst is a private lending platform that owed Celsius approximately $439 million in cash and bitcoin as of July 2022. Celsius had initially obtained collateralized loans from EquitiesFirst in 2019 but was unable to return the collateral in 2021. The recent legal filing names both the company and its CEO, Alexander Christy, as defendants.

The rest of the document related to this case has been kept confidential or “under seal.”

The docket entry on the bankruptcy page reads, “Complaint against Defendants Equities First Holdings, LLC, Alexander Christy (Adversary Complaint Filed Under Seal).” This sealed filing is said to be seeking injunctive relief and a declaratory judgment, with a focus on the “recovery of money/property.”

Celsius Network faced financial difficulties and filed for Chapter 11 bankruptcy protection in July 2022, becoming one of the early casualties of the crypto market downturn.

The co-founder and former CEO, Alex Mashinsky, was arrested earlier this year and is now facing multiple charges, including securities fraud and manipulation related to the company’s CEL token.

Creditors are currently voting on whether to sell assets to a consortium called Fahrenheit, the winning bidder, as part of the bankruptcy proceedings. This could potentially allow them to regain access to some of the assets they have on the Celsius Network platform.

Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.

#Bitcoin #CryptoNews #cryptomarket #CelsiusNetwork #Celsius

🕒 Reading Time: 10 minutes

Celsius Network, a prominent name in the crypto lending sphere, recently made headlines with its transfer of approximately $1 billion in Ethereum (ETH)$ETH to various exchanges. As The Crypto Sage, we delve deep into this strategic move, unraveling its significance in the ongoing bankruptcy proceedings and its potential market impact.
Celsius Wallets and On-Chain Records
Intriguingly, these transfers have been traced to several on-chain addresses associated with Celsius:
0xdb31651967684a40a05c4ab8ec56fc32f060998d0x0d0707963952f2fba59dd06f2b425ace40b492fe0x4f6742badb049791cd9a37ea913f2bac38d012790x8aceab8167c80cb8b3de7fa6228b889bb1130ee80x7de3e919d1d7e5f1b1b27bdb3575b65c5874a5f6
View On-Chain Records here: https://etherscan.io/address/0xdb31651967684a40a05c4ab8ec56fc32f060998d
These wallets have been pivotal in Celsius's Ethereum transactions, hinting at strategic liquidity management and creditor repayment preparations.

Bankruptcy Strategy and Market Impact

Creditor Repayment Anticipation: Celsius's Ethereum transfers are likely linked to plans for repaying its creditors. The anticipation of asset distribution, possibly starting mid-February, signals a shift towards resolution in the ongoing bankruptcy saga.
Ethereum Market Reaction: Ethereum experienced a noticeable decline post these transfers. While a temporary setback, this movement underscores the sensitivity of crypto markets to significant transactions by major players like Celsius.
Strategic Liquidation or Repositioning? The massive transfer to exchanges, including Coinbase and Paxos, raises questions. Is it a move towards liquidating assets for creditor repayments or a strategic repositioning of assets for future stability?
Celsius's New Direction

Transition to Mining and Staking: Post-bankruptcy, Celsius is pivoting towards a new business model focused on crypto mining and staking. This shift, including creating a new entity, NewCo, mirrors the evolving dynamics of the crypto lending space.
Creditor-Owned New Entity: The formation of Mining NewCo, a creditor-owned entity, marks a significant restructuring approach, blending traditional financial mechanisms with crypto-native solutions.
Speculations and Strategic Implications
The exact motivations behind Celsius's Ethereum transfers remain speculative. However, these movements are likely aimed at ensuring liquidity for asset distributions and covering restructuring costs. The significant Ethereum stash still retained by Celsius, valued at around $138.8 million, further adds layers to this strategic maneuver.

Concluding Thoughts
Celsius Network's Ethereum transfers are a focal point in its bankruptcy proceedings, reflecting both the complexities and the potential pathways for resolution in the crypto lending sphere. As the saga unfolds, these strategic moves will undoubtedly shape the future of Celsius and ripple through the broader cryptocurrency market.
💡 Crypto Sage's Insight: "Navigating the complexities of crypto bankruptcy proceedings, Celsius's strategic Ethereum movements offer a glimpse into the delicate balance between creditor obligations and market stability. Keep a keen eye on these wallet activities, as they may signal significant shifts in the crypto landscape."
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👉Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always conduct your own research and consult with financial experts before making investment decisions.