#Tag · bonfire.cafe

@molly0xfff@hachyderm.io · 2 weeks ago

This is a scary trend. If crypto prices don’t rebound, DATCOs could be forced to sell their crypto, dragging the market down even further. Galaxy Digital researchers have compared the model, and its potential unwind, to the 1920s investment trust boom and bust.

This is a scary trend, particularly for traders holding shares in firms that have relied on debt to accumulate their crypto hoards. If crypto prices fail to rally before that debt comes due, the firms could be forced to sell their crypto. Large forced sales, or forced sales across many DATCOs, can depress prices further, only exacerbating the problem. Researchers with Galaxy Digital have compared the potential “unwind” to the busting of the 1920s investment trust boom, writing:12

The 1920s investment trust boom followed a similar reflexive loop. Trusts traded at premiums to NAV, issued shares, and used the proceeds to buy more assets. When sentiment turned, those same mechanics amplified the downside. Collapsing premiums choked off access to capital while leverage magnified losses on falling assets. These cascading failures were an accelerant of the 1929 crash and subsequent Great Depression. — This is a scary trend, particularly for traders holding shares in firms that have relied on debt to accumulate their crypto hoards. If crypto prices fail to rally before that debt comes due, the firms could be forced to sell their crypto. Large forced sales, or forced sales across many DATCOs, can depress prices further, only exacerbating the problem. Researchers with Galaxy Digital have compared the potential “unwind” to the busting of the 1920s investment trust boom, writing:12 The 1920s investment trust boom followed a similar reflexive loop. Trusts traded at premiums to NAV, issued shares, and used the proceeds to buy more assets. When sentiment turned, those same mechanics amplified the downside. Collapsing premiums choked off access to capital while leverage magnified losses on falling assets. These cascading failures were an accelerant of the 1929 crash and subsequent Great Depression.

Cory Doctorow boosted

@molly0xfff@hachyderm.io · 2 weeks ago

With two months of sinking crypto prices, DATCOs are faltering. Some have even begun to sell their crypto to try to rescue plunging stock prices.

ETHZilla, which up until August was a pharmaceutical research firm called 180 Life Sciences, sold around $40 million of its ETH treasury to try to bolster its plunging stock price.9 FG Nexus, which also launched an ETH treasury strategy only months ago, has sold nearly $33 million of its holdings for the same purpose.10 Sequans, a semiconductor company that established a bitcoin treasury in June, sold $100 million of its bitcoin to pay down its debt.11

Now, with two months of sinking crypto prices, some of these firms are beginning to look pretty shaky, and the warnings from Chanos and others seem prescient. Many DATCOs have flipped from trading at a premium to a discount, meaning shares trade for less than the value of the underlying digital asset. Nakamoto, a bitcoin treasury company that merged with the publicly traded KindlyMD earlier this year, has cratered by 98%. BitMine is down 77% since adopting its DAT strategy this past summer. The OG, MicroStrategy, is down 60%. (Nakamoto and BitMine are trading at a discount to the value of their treasury holdings; MicroStrategy still trades at a premium, though it has been narrowing.)

Cory Doctorow boosted

https://www.citationneeded.news/digital-asset-treasury-companies/

@molly0xfff@hachyderm.io · 2 weeks ago

Newsletter: Crypto’s latest “infinite money machine” is the digital asset treasury company — a publicly traded firm that exists primarily to accumulate crypto. For a while, these stocks traded at hefty premiums to the underlying assets. But now, the trade is unraveling.

⚯ Michel de Cryptadamus ⚯

@cryptadamist@universeodon.com · last week

Also made some improvements to the Epstein text messages page:

- Highlighted important names ("trump", "jabor", "brock", " #bitcoin", " #SaudiArabia", " #Israel", etc)

- Deanonymized (with help) as many of the #Epstein emails as I could manage based on various kinds of clues, including the signature lines.

- Added an "Other Files" section at the bottom with preview text + links to raw files that are neither emails nor iMessage log files.

- Various other forms of analysis (common signatures, author counts, etc)

bhaugen boosted

https://paulkrugman.substack.com/p/the-trump-trade-is-unraveling

@wdlindsy@toad.social · 2 weeks ago

"In addition to facilitating crime, Bitcoin has increasingly become an engine of predation. Crypto — or, worse, shares in companies that buy crypto with borrowed money — is heavily sold to naïve investors who don’t realize what they’re getting into. They do well when Bitcoin’s price is rising, but many probably don’t understand how badly they can suffer when it falls."

~ Paul Krugman

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/1

The Trump Trade is Unraveling

Tells from the crypto crash

@molly0xfff@hachyderm.io · 2 weeks ago

https://www.citationneeded.news/digital-asset-treasury-companies/

@molly0xfff@hachyderm.io · 2 weeks ago

@molly0xfff@hachyderm.io replied · 2 weeks ago

With two months of sinking crypto prices, DATCOs are faltering. Some have even begun to sell their crypto to try to rescue plunging stock prices.

https://www.citationneeded.news/digital-asset-treasury-companies/

@molly0xfff@hachyderm.io · 2 weeks ago

https://aaronparnas.substack.com/p/news-white-house-in-turmoil-as-trump

@wdlindsy@toad.social · 2 weeks ago

"The Trump family’s net worth has fallen by roughly $1 billion since September, driven by major crypto-related losses including an $800 million drop in Trump’s stake in Truth Social’s parent company after Bitcoin-linked investments fell, a sharp contraction in the World Liberty Financial token’s value (from a peak of $6B to about $3.15B)," (continued in /4)

~ Aaron Parnas

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/3

@wdlindsy@toad.social replied · 2 weeks ago

(continued from /3)

"a $300+ million loss tied to Eric Trump’s Bitcoin-mining partnership as shares plunged, and a $117 million decline in Trump’s memecoin, all occurring amid a broader $1T crypto market crash and heightened scrutiny of the administration’s ties to crypto players."

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/4

@wdlindsy@toad.social · 2 weeks ago

"And crypto has fallen a lot recently. Bitcoin has actually held up better than smaller, more obscure coins, but even so it’s down roughly 25 percent since late October. ...

At this point Bitcoin is largely a Trump trade. Bitcoin’s price surged after Donald Trump won last year, and its recent plunge coincides with a series of Trump political setbacks."

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/2

https://aaronparnas.substack.com/p/news-white-house-in-turmoil-as-trump

@wdlindsy@toad.social replied · 2 weeks ago

~ Aaron Parnas

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/3

https://paulkrugman.substack.com/p/the-trump-trade-is-unraveling

@wdlindsy@toad.social · 2 weeks ago

~ Paul Krugman

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/1

The Trump Trade is Unraveling

Tells from the crypto crash

@wdlindsy@toad.social replied · 2 weeks ago

"And crypto has fallen a lot recently. Bitcoin has actually held up better than smaller, more obscure coins, but even so it’s down roughly 25 percent since late October. ...

At this point Bitcoin is largely a Trump trade. Bitcoin’s price surged after Donald Trump won last year, and its recent plunge coincides with a series of Trump political setbacks."

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/2

https://paulkrugman.substack.com/p/the-trump-trade-is-unraveling

@wdlindsy@toad.social · 2 weeks ago

~ Paul Krugman

#crypto #Bitcoin #Trump #crime #market #cryptocurrency
/1

The Trump Trade is Unraveling

Tells from the crypto crash

happyborg boosted

#crypto #cryptocurrency #USpolitics #USpol #CitationNeededNewsletter

@molly0xfff@hachyderm.io · 2 weeks ago

Trump has announced a partnership with a Saudi firm to create a new Trump hotel in the Maldives. He plans to fund it by “tokeniz[ing] the development phase” and selling the tokens to US retail crypto traders.

Under any pre-Trump SEC, the tokenized hotel development would likely be considered a securities offering, with risk disclosures and protections aimed at keeping everyday people from being fleeced. But Trump’s SEC picks seem more occupied with advancing his crypto ambitions.

The hotel project is being developed with Saudi partners, making it another arrangement that boosts Trump’s crypto ventures while White House actions benefit the same government. The hotel announcement landed the same day Trump approved selling F-35s to Saudi Arabia.

The Trump Organization’s announcement came the same day that President Trump announced the US would sell F-35 fighter jets to Saudi Arabia, after the country’s leadership appealed to him personally. The move angered Israel, given the potential to shift the region’s military balance, and it stoked fears among US military intelligence officials that the UAE would share the technology with China. The sales will still need to be approved by Congress.5

The project is being developed with the Saudi company Dar Global, continuing the now-familiar pattern of lucrative Trump administration and family deals with Persian Gulf governments and companies. Congressional and public outcry over apparent corruption and ethics violations involving a $2 billion UAE investment in Binance denominated in the Trump family’s stablecoin (which would route tens of millions in interest on the reserves to the Trumps) [I83], a White House–brokered AI-chips deal with the UAE [I93], and another White House deal granting the UAE a 15% stake in TikTok [I94] evidently have not slowed Trump’s pursuit of similar arrangements.

Details of the tokenization scheme are scarce. The Trump Organization has not said whether buyers will receive any share of resort revenues, or indeed any benefits at all. But its statement that the project “tokenizes the development phase itself, offering investors the opportunity to participate in a high-growth, premium real estate project from inception” reads like a textbook securities offering under any pre‑Trump SEC. After all, the Howey test — the test to determine if an instrument qualifies as an investment contract under federal securities laws — involved a 1946 case in which a Florida company developed their orange farming operation by selling real-estate contracts to investors without agricultural knowledge or experience, with a promise that the company would farm the groves and generate profits on investors’ behalf.

Image: A rendering of a teardrop-shaped platform floating on the sea, about 1/3 of which is an indoor hotel area, and the remainder of which is a pool and deck area. — Details of the tokenization scheme are scarce. The Trump Organization has not said whether buyers will receive any share of resort revenues, or indeed any benefits at all. But its statement that the project “tokenizes the development phase itself, offering investors the opportunity to participate in a high-growth, premium real estate project from inception” reads like a textbook securities offering under any pre‑Trump SEC. After all, the Howey test — the test to determine if an instrument qualifies as an investment contract under federal securities laws — involved a 1946 case in which a Florida company developed their orange farming operation by selling real-estate contracts to investors without agricultural knowledge or experience, with a promise that the company would farm the groves and generate profits on investors’ behalf. Image: A rendering of a teardrop-shaped platform floating on the sea, about 1/3 of which is an indoor hotel area, and the remainder of which is a pool and deck area.

Trump business interests
Newest on President Trump’s rapidly expanding list of crypto ventures is a Trump-branded hotel and resort in the Maldives, which the Trump Organization says will be financed by “tokenizing” the project’s construction phase on a blockchain and selling the tokens to US retail investors.34 The Trump sons and some of their crypto business partners have lately been eagerly pitching the idea of new projects involving both real estate and blockchains [I94], which they present as an opportunity for retail investors who they claim have been unfairly excluded from high-risk real estate investments — rather than what it plainly is: an opportunity for Trump to start bilking everyday people as well as institutional lenders, contractors, and laborers. — Trump business interests Newest on President Trump’s rapidly expanding list of crypto ventures is a Trump-branded hotel and resort in the Maldives, which the Trump Organization says will be financed by “tokenizing” the project’s construction phase on a blockchain and selling the tokens to US retail investors.34 The Trump sons and some of their crypto business partners have lately been eagerly pitching the idea of new projects involving both real estate and blockchains [I94], which they present as an opportunity for retail investors who they claim have been unfairly excluded from high-risk real estate investments — rather than what it plainly is: an opportunity for Trump to start bilking everyday people as well as institutional lenders, contractors, and laborers.

happyborg boosted

#crypto #cryptocurrency #USpolitics #USpol #CitationNeededNewsletter

@molly0xfff@hachyderm.io · 2 weeks ago

A case against two brothers accused of exploiting Ethereum MEV bots collapsed into a mistrial after jurors were brought to tears. At first, I thought prosecutors might use the mistrial as an excuse to drop the charges, now that Trump has declared crypto enforcement off-limits.

But it seems prosecutors intend to re-try the case, demonstrating how Trump’s professed pro-crypto, anti-“regulation by enforcement” shift only seems to benefit the wealthy and well-connected. Cases against smaller crypto- and privacy-software developers, meanwhile, have continued unabated.

Screenshot: January 26, 2025 tweet by Roger Ver: “Mr. President, I am an American, and I need your help. Only you, with your commitment to justice, can save me @realDonald Trump”. Below is a video, paused on a frame with Ver staring off into the distance, with a waving American flag superimposed atop

But simultaneously, the Justice Department has continued to aggressively prosecute Roman Storm, a developer of the Tornado Cash cryptocurrency mixing software who received a mixed verdict in his August trial [I90]. The agency recently pursued the maximum sentence against the developers of Samourai Wallet, another crypto mixing service [I96]. And now, rather than dropping the charges, prosecutors have asked for a new trial date to take another swing at convicting the MEV brothers, who face up to 20 years in prison if convicted. — Screenshot: January 26, 2025 tweet by Roger Ver: “Mr. President, I am an American, and I need your help. Only you, with your commitment to justice, can save me @realDonald Trump”. Below is a video, paused on a frame with Ver staring off into the distance, with a waving American flag superimposed atop But simultaneously, the Justice Department has continued to aggressively prosecute Roman Storm, a developer of the Tornado Cash cryptocurrency mixing software who received a mixed verdict in his August trial [I90]. The agency recently pursued the maximum sentence against the developers of Samourai Wallet, another crypto mixing service [I96]. And now, rather than dropping the charges, prosecutors have asked for a new trial date to take another swing at convicting the MEV brothers, who face up to 20 years in prison if convicted.

Despite its professed shift, the Trump-era DOJ has been erratic on crypto enforcement. In statements and in select cases — especially those involving wealthy, well-connected players — it has appeared lenient. It dropped an investigation into crypto prediction market platform Polymarket [I89]. It’s looking to settle a major tax evasion case against Roger Ver, a wealthy crypto investor who in January published a video plea to Trump for leniency, complete with waving flags, a dramatized enactment of Ver being arrested, and Ver insisting “I am an American, and I will die an American” (Ver renounced his US citizenship in 2014 in hopes of avoiding taxes on his crypto gains, though he now says it was to escape “lawfare” from the US government) [I57, 91, 95]. The department has also said it won’t prosecute developers who write crypto software “without ill-intent” even if they fail to register as money transmitters.13 And Trump himself rebuked the Biden-era DOJ by pardoning Binance founder Changpeng Zhao, framing relief for a man alleged to have deliberately evaded US regulations to profit from American customers as a stand against a “war on crypto”.

I originally wondered if the mistrial might give the prosecutors an easy excuse to drop the case. In addition to being highly technical and challenging to explain to a jury, there are genuine questions around whether the brothers were defrauding bot operators who in turn were making automated trades that often disadvantage humans they’re trading against or if they were simply out-trading those bots in a largely lawless ecosystem where it’s expected there will be winners and losers. But the original charges were brought in 2024, by a Biden-era Justice Department from which Trump’s DOJ has been eager to distance itself — particularly when it comes to crypto-related cases. An April 2025 memo from Deputy Attorney General Todd Blanche condemned the Biden-era DOJ’s approach to crypto, deeming it a “reckless strategy of regulation by prosecution, which was ill conceived and poorly executed”. In the memo, he outlined new DOJ priorities aligned with Trump’s directive to support the crypto industry, dismantled the National Cryptocurrency Enforcement Team, and directed the Criminal Division’s Market Integrity and Major Frauds Unit to halt cryptocurrency enforcement [I81].

MEV bot brothers
The prosecution of the two brothers who exploited MEV bots on Ethereum has ended in a mistrial. Jurors were subjected to a month-long, intensely technical crash course on Ethereum, maximal extractable value,b and the hordes of bots that execute automated trades on the network. Over three days of deliberations, jurors submitted eleven notes to the judge indicating that they were struggling to reach a verdict. In the final one, sent on the evening of Friday November 7, jurors wrote, “We held another vote. We are no closer to a unanimous decision. We are under stress. Yesterday some cried. Many have not slept. This is hardship.” The judge declared a mistrial, seeing no hope that the jury would reach a verdict the following Monday, and facing the risky possibility of having to proceed with only eleven jurors due to a scheduling conflict.c As crypto advocate Neeraj Agrawal wrote, “A group of every day Americans was forced to learn how Ethereum works and this was the result.”12 He’s right — sometimes that abyss stares back. — MEV bot brothers The prosecution of the two brothers who exploited MEV bots on Ethereum has ended in a mistrial. Jurors were subjected to a month-long, intensely technical crash course on Ethereum, maximal extractable value,b and the hordes of bots that execute automated trades on the network. Over three days of deliberations, jurors submitted eleven notes to the judge indicating that they were struggling to reach a verdict. In the final one, sent on the evening of Friday November 7, jurors wrote, “We held another vote. We are no closer to a unanimous decision. We are under stress. Yesterday some cried. Many have not slept. This is hardship.” The judge declared a mistrial, seeing no hope that the jury would reach a verdict the following Monday, and facing the risky possibility of having to proceed with only eleven jurors due to a scheduling conflict.c As crypto advocate Neeraj Agrawal wrote, “A group of every day Americans was forced to learn how Ethereum works and this was the result.”12 He’s right — sometimes that abyss stares back.

Hacker News

@h4ckernews@mastodon.social · 2 weeks ago

Crypto got everything it wanted. Now it's sinking

https://www.economist.com/finance-and-economics/2025/11/18/crypto-got-everything-it-wanted-now-its-sinking

#HackerNews #Crypto #Crisis #Crypto #Trends #Economic #Downturn #Blockchain #Challenges #Cryptocurrency #Analysis

#crypto #cryptocurrency #USpolitics #USpol #CitationNeededNewsletter

@molly0xfff@hachyderm.io · 2 weeks ago

A crypto advocacy group project called State Network is looking to broaden the industry’s influence on state and local elections in the US. “We want every lawmaker from Congress down to your local school board to be pro crypto,” said Digital Chamber CEO Cody Carbone.

In elections and political influence
The Digital Chamber crypto advocacy group has announced a new project called the State Network, through which they hope to push for state- and local-level pro-crypto policies. While crypto political spending during the 2024 elections was heavily focused on congressional and presidential races, the State Network plans to work to influence much more local races. “We want every lawmaker from Congress down to your local school board to be pro crypto,” said Digital Chamber CEO Cody Carbone.18 Someone may wish to break the news to him that school boards don’t write laws. — In elections and political influence The Digital Chamber crypto advocacy group has announced a new project called the State Network, through which they hope to push for state- and local-level pro-crypto policies. While crypto political spending during the 2024 elections was heavily focused on congressional and presidential races, the State Network plans to work to influence much more local races. “We want every lawmaker from Congress down to your local school board to be pro crypto,” said Digital Chamber CEO Cody Carbone.18 Someone may wish to break the news to him that school boards don’t write laws.