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A federal judge has authorized the issuance of subpoenas to Three Arrows Capital co-founders Su Zhu and Kyle Davies.

The gives liquidators the ability to force the collapsed hedge fund’s former leadership to turn over any “recorded information, including books, documents, records, and papers” relating to Three Arrows Capital’s property or finances — including seed phrases and private keys — within 14 days.

The order also names Mark Dubois, Cheuk Yao Pau and Kelly Chen — Davies’ wife — “discovery targets.” Tai Ping Shan Limited, DeFiance Capital and Starry Night Capital are also labeled as such.

Three Arrows Capital filed for Chapter 15 bankruptcy on July 1, in the wake of the collapse of the cryptocurrency luna and it’s associated algorithmic stablecoin UST.

Zhu and Davies went quite for some time after the collapse of Three Arrows Capital, with their exact whereabouts long unknown. However, both have resurfaced on social media following the collapse of crypto exchange FTX and its associated trading firm Alameda Research. It is currently believed that Zhu and Davies are located in Dubai and Bali, respectively.

© 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.

Video game company Atari now allows holders of its NFT collection, Atari NFT, to print framed prints and posters through a new collaboration with print-on-demand company Pixels.

Atari NFT holders may connect their Ethereum wallets to AtariPrints.com to create physical versions of their NFTs, which are available in five different sizes.

“There’s no easier way to transform your NFT business into a physical art business,” noted Sean Broihier, CEO of Fine Art America, in a press release, adding: “We’re very excited to partner with Atari to show the NFT community what’s possible when you allow NFT holders to transform digital assets into physical products.”

“With the recent rise in popularity of NFTs, it was a natural fit to expand our printing capabilities to the NFT community,” added Sean Broihier, CEO of Pixels. 

The Atari NFT collection — dubbed 50 Years of Atari — was launched in September to celebrate the company’s 50th anniversary and pay homage to the old-school Atari 2600 console. It consists of 2,600 items. Its floor price is currently 0.068 ETH ($83.37) on NFT marketplace OpenSea.

Atari has long been a proponent of the web3 space. In September 2021, Atari’s Head of Blockchain Manfred Mantschev told The Block it hopes to capitalize off of the “land” it owns in virtual worlds built by Decentraland and The Sandbox.

© 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 infrastructure firm Blockstream is looking for a fresh injection of capital at a significantly lower valuation than it raised at last year.

The startup raised $210 million in a Series B round led by Baillie Gifford and Bitfinex in August 2021, which brought its valuation to $3.2 billion. 

Blockstream could now be valued at below $1 billion by investors, putting its crypto unicorn status in jeapordy, according to a report from Bloomberg.

Founded in 2014, the startup has raised a total of $299 million to date, according to data from Crunchbase. It provides infrastructure services to the crypto industry and recently partnered with fintech firm Block to launch a solar and battery-powered mining facility. It’s also made a number of acquisitions over the years including SponDoolies-Tech and Adamant Capital.

Blockstream’s CEO Adam Back told Bloomberg the money from the funding round would be used to expand its capacity to host crypto miners. He declined to comment on the size of the round or the valuation.

“We rapidly sold out all of the capacity and have a big backlog of existing and new customers with miners seeking large-scale hosting with us,” he said.

Blockstream isn’t the only crypto startup having to adjust its expectations as market conditions worsen following the collapse of crypto exchange FTX. Crypto unicorns Amber Group and Blockchain.com are also in the process of fundraising and are either raising at flat or lower valuations than in previous rounds, according to reports.

© 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.

As crypto venture funds try to weather the storm stemming from the collapse of crypto exchange FTX, new kid on the block No Limit Holdings is embracing the chaos. 

“We liked valuation trends in August, so we like them even better now,” said Gin Chao, founding partner of CVP NoLimit Holdings, in a recent announcement. “This is the time to lean in.” 

Chao is a crypto industry veteran who previously headed up strategy for leading crypto exchange Binance. He has now joined forces with private equity giant ClearVue Partners to invest in the blockchain space through a new venture called No Limit Holdings. 

Deploying a $100 million fund in a bear market

No Limit Holding’s launched its first fund, CVP NoLimit Fund I, four months ago. The Block previously reported that the fund is looking to raise a total of $100 million. Chao said he couldn’t comment on how much money the fund has raised so far.

The capital it has raised will be deployed across seed stage deals and in strategic rounds, with check sizes between $250,000 to $3 million. 

“Our modest fund size with large GP commit means that we are highly incentivized to deliver returns on the fund rather than relying on management fees,” said Chao in a release. “We are essentially underwriting our own capital to risk-adjusted returns.” 

The fund has already made investments in startups such as Mysten Labs, Connext, Hogwarts Labs, Binance.US and IQ Protocol. 

“We invest in businesses we understand and teams that can execute,” Chao said. 

The new fund breaks cover during the depths of the crypto bear market, following the collapse of industry darling FTX, which was previously valued at $32 billion, and widespread reverberations from its downfall that have shaken the market. 

Despite a steep decline in investor sentiment, Chao remains optimistic, looking to invest in multi-chain projects to mitigate risk and increase user inclusion, according to the announcement. He also said that the fund was looking to “minimize exposure” to centralized entities and is self-custodying its crypto assets with multi-signature solutions. 

It all started with a game of poker

ClearVue Partners is a Chinese private equity firm that was founded in 2012 and oversees more than $1 billion in assets. The No Limit name is a nod to a 2010 poker game in which the principals of ClearVue Partners and No Limit Holdings began their crypto journey, according to a release. 

“No Limit Holdings launched its first fund specifically to invest into this crypto winter and our timing couldn’t have been better,” Chao said. 

© 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.

The U.S. House of Representatives Ethics Committee has ordered Rep. Madison Cawthorn, R-N.C., to pay more than $15,000 in punitive donations and fines as a result of his violation of congressional and governmental ethics rules around a little-known digital currency.

Cawthorn, who lost the Republican nomination for his seat after a series of controversies, failed to disclose holdings in the token branded “LGB Coin” in accordance with House ethics rules and federal law, a committee investigation concluded. Cawthorn did not file required disclosures for his holdings until after an investigation began, and he promoted purchase of the token publicly after purchasing $150,000 worth of the coins.

The name of the token is a reference to “Let’s Go Brandon,” a tongue-in-cheek rallying cry for critics of President Joe Biden.

On top of the “admonishment” from the House Ethics Committee, the North Carolina Republican appears to have lost virtually his entire investment, even though he violated gift rules by accepting a discount on the previously undisclosed purchase. Cawthorn estimated his current token holdings to be valued at $357.52, though the committee report on the investigation notes “the value of his remaining LGB Coin was substantially less at the time the Report was adopted, and it is unclear how Representative Cawthorn reached his estimation of the value.”

As of Nov. 19, Cawthorn reported holding 15,378,707,329 of LGB Coin.

Charity donation 

The committee ordered Cawthorn to donate $14,237.49, the approximate value of the gift he received, to charity and pay a late disclosure fine of $1,000 to the Department of Justice.

The committee said it looked into potential fraud and insider trading around the issue but did not find sufficient evidence. However, the Ethics panel said its report should serve as an admonishment for the soon-to-be-former congressman who “acted in a manner that did not reflect creditably upon the House” in violation of House conduct rules.

The Ethics Committee also investigated allegations that Cawthorn had an inappropriate relationship with a second cousin who was employed by his office after the release of photographs involving “suggestive comments and conduct.” 

The panel did not find evidence of an improper relationship with an employee while Cawthorn held office, and noted that the incidents occurred before Cawthorn’s time in the House and that only first cousins fall under nepotism rules.

© 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 tax startup Koinly has cut 14% of its staff, a reduction in headcount CEO Robin Singh attributed to a bear market made worse by the collapse of crypto exchange FTX.

“We are taking measures to ensure we’re as lean as possible as we make our way through the crypto winter,” CEO Robin Singh said in a statement. “While change is an unavoidable part of business, it’s been a sad week at Koinly as we have had to let go of several of our colleagues.”

How many positions Koinly cut is unclear. The company’s LinkedIn page lists 93 employees. An email asking Koinly for clarification about its total headcount was not returned by the time of publication. 

Koinly’s main business is helping people in more than 20 countries calculate and declare the taxes owed on their digital assets. While the company saw record growth this year and increased its headcount significantly, the company is cutting back as it adjusts to a market in which crypto investors are seeing more losses and not filing as many returns, which Singh said is a common mistake. 

© 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.

Most bitcoin mining stocks tracked by The Block traded lower on Tuesday, some showing double-digit declines.

Bitcoin was trading at around $17,000 by market close, according to data from TradingView.

BTCUSD Chart by TradingView

Stronghold Digital Mining fell by 25.40%, followed by Greenidge Generation Holdings (-11.31%), Bit Digital (-10.07%) and Bitfarms (-7.41%  on Nasdaq).

Here’s how crypto mining companies performed on Tuesday, Dec. 6:

© 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.

Bitcoin and ether were little changed amid a plunge in equities.

Bitcoin was trading just below $17,000, up about 0.2% by 4:00 p.m. EST, according to TradingView data. The leading cryptocurrency by market cap was at $16,993, while ether traded down 0.3% at $1,259.

BTCUSD chart by TradingView

Binance’s BNB was up 0.6% over the past day, Ripple’s XRP gained 0.9%, and Polygon’s MATIC lifted 0.2%. 

The U.S. Dollar Index rose to 105.575 at 4:00 p.m. EST, up from 105.1 before the market opened today. 

DXY chart by TradingView

Crypto stocks and structured products 

The S&P 500 dropped 1.4%, while the Nasdaq 100 slipped 2%.

Coinbase slumped 7.8%, according to Nasdaq data. Shares of the exchange were trading at $42.38 at the close. 

SI chart by TradingView

Silvergate closed down 4.6% to $23.13 — narrowly avoiding two-year lows.

Block shed 2.9% to $61.33, while MicroStrategy bucked the dip to add 0.2%. Meta sank 6.8% today following a report of EU concerns over targeted advertising in the bloc. 

Grayscale’s two main products — GBTC and ETHE — are trading at ever-widening discounts to net asset value (NAV). GBTC’s discount widened to 43.06%, while ETHE’s reached another all-time low of 46.45%. 

Fir Tree Capital said it is suing Grayscale for information to investigate potential mismanagement and conflicts of interest, Bloomberg reported, citing Delaware court documents. 

Fir Tree is aiming to use the information to push Grayscale to address the considerable discount it trades at relative to the bitcoin it holds by lowering fees and resuming redemptions, Bloomberg cited sources as saying. The complaint alleges Grayscale has harmed investors through “shareholder-unfriendly actions.”

© 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.

Hedge fund Fir Tree Capital Management is suing crypto investment fund Grayscale Investments for information to investigate potential mismanagement and conflicts of interest, Bloomberg News reported, citing Delaware court documents. 

Fir Tree wants to use the the information to push Grayscale to address the large discount it trades at relative to the bitcoin it holds by lowering fees and resuming redemptions, Bloomberg cited sources as saying. 

The complaint also alleges that Grayscale investors have been harmed by “shareholder-unfriendly actions.”

Grayscale is part of the Digital Currency Group (DCG) that has faced challenges after the collapse of the FTX crypto exchange, with sister firm Genesis halting client withdrawals last month.

© 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.

Sam Bankman-Fried is lawyering up (again) after his crypto exchange came crashing down. 

The former FTX CEO hired white-collar attorney Mark Cohen, a spokesperson for Bankman-Fried confirmed. The news was first reported by Reuters.

The disgraced ex-CEO parted ways with Paul, Weiss, Rifkind, Wharton & Garrison in November and later reportedly brought on David Mills and Gregory Joseph.

Bankman-Fried’s latest move comes as regulators investigate the collapse of FTX, which filed for bankruptcy protection last month after a run on its native utility token, and Bankman-Fried stepped down as CEO. 

Cohen, who leads the white-collar criminal defense and regulation groups at the law firm Cohen and Gresser, represented Ghislaine Maxwell in her recent sex trafficking case. She was sentenced to 20 years in prison in June. Cohen also won an insider trading case against the Securities and Exchange Commission in 2014. The SEC is among the regulators investigating FTX.

Cohen’s law firm did not respond to a request for comment. 

© 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.