July 15, 2022
Photo: Kiyoshi Ota/Bloomberg via Getty Images
Good morning, and welcome to Protocol Fintech. This Friday: crypto bankruptcy questions, Revolut’s new Reader and OpenSea layoffs.
Revolut isn’t content with being a consumer super app. It wants to be a business super app, too. That’s the apparent rationale behind introducing Revolut Reader, a competitor to Square’s card-reading hardware. Apple’s Tap to Pay promises to make such hardware obsolete, but that’s going to take a while to roll out, and in the meantime, there’s payment-processing money to be made. I wonder if Block will take the threat seriously and double down on its international expansion, or just continue to indulge its CEO’s bitcoin fixation.
— Owen Thomas (email | twitter)
The first day in bankruptcy court for crypto lender Voyager Digital came with a warning, from the company's own attorney, that this could get tricky. “I think for many of us, this is unchartered territory,” said Joshua Sussberg, an attorney with Kirkland & Ellis. “There will be many potential legal issues of first impression.”
The U.S. bankruptcy courts have never dealt with an insolvency proceeding of a crypto company on the scale of Voyager Digital or Celsius. Both companies, which operate lending businesses, are entering Chapter 11 bankruptcy with billions in both assets and liabilities. The filings came just a week apart: Voyager on July 6 and Celsius on July 13.
The proceedings will be watched closely. Policymakers, industry executives and customers eager to get their crypto back will all have questions.
Crypto customers don’t have special protection. That’s becoming clearer and clearer.
Regulation is coming. But it likely won’t arrive soon enough to provide relief in the Voyager or Celsius cases.
The current crash should leave more crypto companies open to accepting stronger oversight and regulation, said Diogo Mónica, co-founder and president of Anchorage Digital, the first federally chartered crypto bank. "People are going to remember this: What happens if the company fails? How are you running risk management?" Mónica said. "All of a sudden those questions are being asked again that, to some extent, get forgotten during bull markets.”
— Ryan Deffenbaugh (email | twitter)
A version of this story first appeared on Protocol.com. Read it here.
Android and Google Play are blank canvases. Developers are the artists who paint on them: During the past two years there has been a big debate between life and livelihood. A lot of people had to make a choice between the two. Those who could work from home didn’t have to make that hard choice because we could have both life and livelihood — and tech was the reason people could have both.
On Protocol: The crypto market shed $2 trillion in seven months. Here’s everything you need to know about the crypto market crash, from layoffs to bankruptcies, and its effect on consumers, investors, employees and regulators.
The CFTC added 34 firms onto its Registration Deficient List. Putting the number of firms on the RED List at just over 200, 34 unregistered foreign entities, many of them crypto firms, were added to the list of firms acting in a capability that requires registration with the CFTC and failing to do so.
Also on Protocol: OpenSea announced Thursday that it was laying off 20% of its workforce due to "an unprecedented combination of crypto winter and broad macroeconomic instability” to prepare for the “possibility of a prolonged downturn.”
Celsius acknowledged a $1.2 billion gap on its balance sheet. The troubled crypto lender holds $4.3 billion in assets and $5.5 billion in liabilities, according to a recent court filing. FTX had reportedly passed on a deal to acquire Celsius due to the gap.
Coinbase’s global market share dropped to 2.9%. The crypto exchange had peaked at about 8-9% in November last year, and is now reportedly ranked 14th in average trading volume by dollars, down from 4th last year.
The Bank of England’s Deputy Governor John Cunliffe wants to make sure everyone understands the urgency of crypto regulation, so he came up with an analogy. “To be successful and sustainable, innovation has to happen within a framework in which risks are managed: People don’t fly for long in unsafe aeroplanes,” he said in a speech.
Daniela Brozzoni started working as a bitcoin developer straight out of high school, landing an internship at Blockstream. Why bitcoin? It’s different from other types of crypto, she says. “With other coins, you have a rich CEO who just wants to get richer. With bitcoin, there is no CEO, and I really like that,” she told CoinDesk.The chief executive of the U.K.’s Financial Conduct Authority, Nikhil Rathi, thinks there’s a need for global cooperation on crypto regulation, and is ready to link arms across the Atlantic with U.S. regulators. “I don’t think there’s any fundamental sort of divergence of view or approach,” he said.
Yuga Labs, the creator of the Bored Ape Yacht Club, has a lock on the top NFT collections following its acquisition of Larva Labs’ properties. Over the last 30 days, four of the top five collections by trading volume were managed by Yuga.
Android and Google Play are blank canvases. Developers are the artists who paint on them: Many people don’t realize the many ways developers benefit from Google Play and that the core DNA of Android is open. From the minute that developers get a creative idea, they have every tool they need to build the app, understand the security policies, launch the app and gain a global audience.
Thanks for reading — see you Monday!