Coinbase Slams GAO's Crypto Report; Terraform Labs Files Bankruptcy; Grayscale Bitcoin Trust Assets Dip
Summary:
Paul Grewal, Coinbase's chief legal officer, criticizes the US Government Accountability Office (GAO) for lack of analysis in its latest crypto report. Terraform Labs, led by Do Kwon, files for Chapter 11 bankruptcy protection. Grayscale's Bitcoin Trust (GBTC) sees a significant decrease in its assets, falling by around $5 billion over a weekend.
Paul Grewal, Coinbase's chief legal officer, has publicly criticized the U.S Government Accountability Office (GAO), alleging that their latest cryptographic report was produced without any substantial analysis. In other news, Terraform Labs, under the leadership of Do Kwon, has applied for Chapter 11 bankruptcy protection. Additionally, Grayscale experienced a dramatic reduction in its Grayscale Bitcoin Trust (GBTC) assets; a decrease of approximately $5 billion was noted over the past weekend.
In an aggressive move, Coinbase's Grewal lambasted the United States Government Accountability Office (GAO) for their recent findings related to the use of cryptocurrencies for evading sanctions. He claimed that they had not adequately analyzed the data and were instead targeting an industry that invests millions to adhere to legal compliance.
Despite blaming cryptocurrencies for providing an evasion route for law offenders, the Government Accountability Office (GAO) conceded in its report that the decentralized structure and transparent ledger of cryptocurrencies could aid U.S agencies and analytics firms in tracing transactions and potentially exposing illegal actors. The report also acknowledged that the usage of digital assets as a method of transaction was still minimal and hinted that the establishment of global standards could enhance adherence to Anti-Money Laundering (AML) regulations.
Terraform Labs, formed by Do Kwon and known for creating the withdrawn stablecoin TerraUSD (UST), has sought bankruptcy protection in the United States. They submitted their application for Chapter 11 bankruptcy protection to the United States Bankruptcy Court for the District of Delaware. The filing stated that the organization estimates its assets and liabilities to lie between $100 million and $500 million.
According to CEO Chris Amani, the bankruptcy filing was a necessary step in order to manage existing legal challenges while still advancing towards the company's collective objectives. This announcement followed just four days after the U.S. SEC postponed Do Kwon's upcoming fraud trial till March 25, in response to his legal team's request.
In the meantime, Grayscale has witnessed a substantial decline in the value of its Bitcoin ETF in the last week. The downturn is a result of a mix of share redemptions and unfavorable market variables. The assets under the Grayscale Bitcoin Trust (GBTC) have plummeted from $28.5 billion to $23.7 billion between 10th and 18th of January, as per YChart and GrayScale data. The exodus from GBTC had been anticipated following the SEC's approval of Grayscale's conversion of the fund into an ETF.
Data showed an outflow of approximately $1.1 billion from GBTC over three days, whereas other recently sanctioned Bitcoin ETFs received considerable inflows. The shift was particularly noticeable in the case of BlackRock's ETF, which recently added 8,700 BTC valuing nearly $358 million.
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Published At
1/22/2024 2:47:07 PM
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