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Crypto investment firm 10T Holdings is actually “doing ok” this year despite market volatility surrounding the collapse of FTX, hedge fund veteran Dan Tapiero said at the Token2049 conference in London.

Tapiero added that he wasn’t “all that worried” about the fallout and its potential impact on the fund’s performance.

“We may underperform on the upside,” Tapiero said, referring to results this year. “But we are outperforming on the downside.”

Founded in 2020, the investment firm has $1.2 billion in assets under management, according to its website. 10T’s portfolio includes crypto exchanges Kraken and Gemini, and The Block reported the firm was raising a third fund in December last year.

The fund stays clear of token investments, targeting equity investments in mid-to-late-stage crypto companies, Tapiero said, adding that it only invests in companies with revenues of $50 million or more. In some cases, those companies themselves may have tokens on their personal balance sheets, he added. Funds from firms such as a16z and Pantera Capital are down more than 50% this year as token prices dropped amid a challenging macro environment.

“We are not looking to be the number one performer, in fact, we are definitely not,” Tapiero said, describing the fund’s more conservative strategy.

“Even with SBF and with all this nonsense, this is the greatest macro investment I’ve seen in years,” Tapiero said. “I don’t know what’s a bigger trade than the digitization of money. So that’s what I’m trying to play and just capture that.”

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto exchange Bitmex, which says it has no FTX or Alameda exposure, plans to launch a native crypto token for traders on Friday, regardless of market volatility amid the collapse of Sam Bankman-Fried’s empire.

“We’re sticking to our program,” Salama Belghali, Bitmex’s global head of business development and partnerships said at a conference. “The new token is not something we are putting out there in order to pay for lunch.”

Belghali also said that Bitmex is “not exposed to either Alameda nor FTX nor FTT,” she said. “We actually have very strict guidelines. We are safe.”

The comments come as crypto markets have been in chaos following the news that Binance may buy FTX upon the latter’s token collapse. The firm announced last week that it will reduce its headcount by 30% as part of a pivot away from its “beyond derivatives” strategy. The layoffs came shortly after CEO Alexander Höptner departed from his role. 

Bitmex’s move to refocus on derivatives to regain market share means “our disadvantage has become our advantage” after the FTX collapse, she said.

Bitmex was once considered a leader in cryptocurrency derivatives, claiming 35% of the open interest across bitcoin futures, according to data from The Block Research. Now it only holds about 2% of market share, and companies such as CME Group and, until recently, FTX, hold the majority of market share. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Social media giant Twitter appears to be moving deeper into the payments business, as reflected by a registration filed this month with the U.S. Financial Crimes Enforcement Network (FinCEN).

Twitter registered as a money services business on Nov. 3, according to FinCEN data. FinCEN oversees the activities of money service businesses in the U.S., and registered businesses must report suspicious transactions to the agency, which is part of the Treasury Department.

The New York Times first reported the FinCEN development. The registering entity is named Twitter Payments LLC, which according to business registration data, was formed in August in Washington State. 

The filing comes shortly after Elon Musk acquired the company in a $44 billion deal. Musk has previously mused about turning Twitter into a so-called “everything app.” Musk also has talked about expanding Twitter’s service coverage to include digital payments, as reported by Reuters.

Twitter’s billionaire owner also has considered allowing users to link their bank accounts and cards to Twitter.

Musk’s payments-focused plans could ultimately make Twitter more akin to apps like China’s WeChat, the social media platform that offers mobile payments alongside messaging and other features.

WeChat Pay and competitor Alipay, offered by Alibaba’s Tencent, currently exert a duopoly over digital payments in China. The government’s central bank digital currency efforts have been linked to attempts by Beijing to limit this dominance.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto trading and lending firm Genesis Trading reported losses of around $7 million “across all counterparties” that include Alameda Research after it hedged and sold collateral on Tuesday in anticipation of market volatility following a liquidity crunch at FTX. 

The company reiterated that it had no material exposure to FTX’s native token or “any other tokens issued by centralized exchanges.” It said that 95% of the collateral on its lending book is comprised of USD, stablecoins, bitcoin and ether. 

Although Genesis said it did trade with FTX, it said the relationship did not extend to lending. 

“Our business ops, including lending and trading across spot and derivatives, continue to run normally and our balance sheet remains strong,” the company wrote on Twitter. “Yesterday was a top 5 volume day for our derivatives business as clients turn to us during volatile market conditions to manage their risk.”

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Episode 109 of Season 4 of The Scoop was recorded live with The Block’s Frank Chaparro and Framework Ventures Co-Founder Vance Spencer.

Listen below, and subscribe to The Scoop on Apple, Spotify, Google Podcasts, Stitcher or wherever you listen to podcasts. Email feedback and revision requests can be sent to podcast@theblockcrypto.com.

In response to the unexpected collapse of FTX, billions of dollars in crypto have been flowing out of exchanges over the past 24 hours as market participants rush to self-custody their funds.

In this breaking news episode of The Scoop, Frank Chaparro and Framework Ventures Co-Founder Vance Spencer analyze the factors that contributed to FTX’s rapid downfall, as well as speculate on the comingled relationship between Alameda and FTX.

According to Spencer, a Coindesk report on Alameda’s balance sheet published on November 2nd was a critical turning point in the saga.

“What I was expecting a giga-brain firm like Alameda to have on their balance sheet was sovereign bonds offset by equity positions offset by other hedges, but it was just kind of like a retail crypto portfolio,” says Spencer.

The prices of tokens associated with FTX and Alameda have plummeted, particularly FTX’s native FTT token, which is down over 80% in the last two days.

Since FTX is backed by some of the biggest funds in the world including SoftBank and Tiger Global, Spencer suggests the fact that Binance appears to be FTX’s only option points to the likelihood that the reality of FTX’s book must be very severe:

“For you to go to your biggest rival who is actively trying to kill you and sell to them implies to me that the other people weren’t biting and that [Binance] was kind of the only option… What this makes me think is that the hole is either very large, or there’s something else on the balance sheet which caused other people to pass.”

During this episode, Chaparro and Spencer also discuss:

• Why DeFi remains resilient
• How the FTX saga compares to the 3AC meltdown
• The regulatory path forward without SBF

This episode is brought to you by our sponsors Tron, Ledn
About Tron
TRON is dedicated to accelerating the decentralization of the internet via blockchain technology and decentralized applications (dApps). Founded in September 2017 by H.E. Justin Sun, the TRON network has continued to deliver impressive achievements since MainNet launch in May 2018. July 2018 also marked the ecosystem integration of BitTorrent, a pioneer in decentralized web3 services boasting over 100 million monthly active users. The TRON network completed full decentralization in December 2021 and is now a community-governed DAO. | TRONDAO | Twitter | Discord |

About Ledn
Ledn was founded on the unshakeable conviction that digital assets have the power to democratize access to the global economy. We help you to experience the real life benefits of your Bitcoin without having to sell it. Start a savings account, take out a loan, or double your Bitcoin. For more information visit Ledn.io

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto wallet provider MetaMask has launched a new feature that will aggregate bridge services for users who want to transfer their crypto across different chains.

The release is in the beta stage, and MetaMask said in a blog post that the service is part of its newly launched portfolio app.

Bridging in crypto involves the transfer of tokens from one chain to another, and the process requires the use of a bridge provider. MetaMask says its bridge aggregator will support four bridge providers including Connext, Hop, Celer cBridge and Polygon Bridge.

Users will be able to move up to $10,000 of supported tokens using any of these bridges across Ethereum, Avalanche, BNB Smart Chain and Polygon. Supported tokens include ether and wrapped ether; popular stablecoins such as DAI; and native gas tokens like matic. The bridge aggregator will help users find the cheapest route for moving coins across supported networks.

MetaMask said it will not charge transaction fees for bridging crypto during the beta release. The platform is looking to expand its coverage to Layer 2 chains such as Optimism and Arbitrum.

Crypto bridges have become a prime target for hackers, with attacks leading to the theft of over $2.5 billion from cross-chain bridge protocols in the last two years. Some of these incidents include the Ronin and Poly Network hacks that saw more than $1 billion stolen from both platforms.

MetaMask said it carried out an extensive vetting process before selecting its preferred bridge providers. The crypto wallet provider added that the selected bridges met requirements for security and decentralization.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Officials at the Commodity Futures Trading Commission and the Securities and Exchange Commission are investigating crypto exchange FTX, according to a Bloomberg report.

The inquiry is focused on the handling of client funds amid FTX’s liquidity problems and subsequent collapse, as well as the relationship between FTX and American affiliate FTX.US. Bloomberg reports that the SEC probe into the FTX.US relationship predates this week’s events, citing two sources who declined to speak on the record due to the sensitivity of the matter, 

News yesterday that FTX had struck an agreement for a possible acquisition by Binance stunned the crypto industry and stirred further volatility in an already gyrating digital asset market. Bitcoin is trading at $17,050 as of 11:57 p.m. ET, according to TradingView data. 

It’s unclear at this time whether the deal will go through, however. Reports from Bloomberg and CoinDesk indicate that Binance may pull out because of a potential multi-billion dollar financial hole. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Solana Labs COO Raj Gokal weighed in on the FTX crisis that will see its non-U.S. assets sold to Binance, calling it a “crucible moment” for the Solana ecosystem that has close ties to the collapsing crypto exchange. 

“Binance seems to care about the ecosystem, but they have a lot of work on their hands,” he wrote on Twitter. “I’m hopeful they can work out a good deal with FTX.”

The price of Solana’s native coin SOL has plummeted over 40% to $16.58 over the last 24 hours, with the price of Solana ecosystem tokens like Serum also collapsing on the back of the FTX crisis. The global selloff of crypto assets triggered by news of FTX’s problems hit just as $1 billion of SOL is set to unstake in less than 24 hours. Representing 13% of the coin’s circulating supply, it’s the second-largest unstaking of SOL by validators, raising concerns of a further negative impact on price.

Image: CoinGecko.

“This crucible moment for the Solana ecosystem is as difficult as the last one,” Gokal wrote. “The difference is there are 10x more of us to band together this time. Next time, there will be 10x more. Each time, we’re stronger. The fundamentals are better.”

Solana Labs CEO Anatoly Yakovenko was keen to reassure the Solana community, tweeting: “Solana Labs, a U.S. corporation, didn’t have any assets on FTX.com, so we still have tons of runway, and luckily still a small team.”

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Amber Group said it has no exposure to Alameda or FTT, but it has been an active trading participant on FTX and less than 10% of total trading capital is tied up in the exchange.

“While we have significantly reduced our exposure over the course of the week, we still have withdrawals that have yet to be processed,” the digital asset company wrote on Twitter. “It does not pose a threat to our business operations or liquidity.”

The comments come as crypto market volatility continues and questions mount about whether Binance may be reconsidering its bid to buy FTX following the latter’s liquidity crisis. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• Layer 3 blockchains provide higher levels of customizability while retaining some level of security from layer 1 blockchains.
• Layer 3 blockchains can be built with recursive proving, compressing multiple validity proofs into one recursive proof.
• StarkWare, zkSync, Slush, Immutable and Sorare are some of the projects that have revealed plans relating to Layer 3s.
• Layer 3s would be better suited for application-specific purposes while providing reduced transaction costs for users.

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