New York Federal Reserve Partners With MAS to Research on wCBDCs

A new collaboration between the Federal Reserve Bank of New York’s New York Innovation Center (NYIC) and the Monetary Authority of Singapore (MAS) has been confirmed to be targeted toward research into wholesale Central Bank Digital Currencies (wCBDCs).


This joint experiment seeks to assess the possibilities and the use cases of wCBDCs as payment for cross-border transactions and in this case, with the use of multiple currencies (cross-border cross-currency transactions). 

Ultimately, the project aims to mitigate settlement risk which has been a problem in cross-border payments. 

The experiment which has been dubbed ‘Project Cedar Phase II x Ubin+’ is in different phases which will unfold gradually. It will look into the introduction of wCBDCs in enhanced designs for atomic settlements of these cross-border cross-currency transactions. The interoperability of the wCBDC across several networks while maintaining autonomy is crucial to the experiment. 

Michelle Neal, Head of the Markets Group at the New York Federal Reserve stated “Experimentation across the central banking community is vital to leverage the full potential of digital assets and CBDCs in particular. Building off Phase I, the Project Cedar Phase II x Ubin+ collaboration will provide further visibility into the functionality and interoperability of multi-currency ledger networks utilizing their own unique designs.”

Also speaking of the interoperability of these central digital currencies across networks, the Deputy Managing Director (Markets & Development) at MAS Leong Sing Chiong outlined “The project takes a practical approach and designs for any future wholesale CBDC to be interoperable across networks while maintaining each network’s autonomy.”

New York Fed Contributes to CBDC Discussions

Noteworthy, the New York Fed laid much emphasis on the fact Project Cedar Phase II x Ubin+ is not out to advance or boost any particular policy outcome. 

Also, the entity pointed out that it is not advocating for either a retail CBDC or a wholesale CBDC nor is it dictating the most appropriate design for a central digital currency. It is only making its technical contribution to the broader and transparent public discussions about CBDCs.

However, the U.S Federal reserve has been weighing the pros and cons of a potential Digital dollar for some time. 

They are considering how beneficial or destructive the CBDC will be to the American economy. For now, the collaboration with MAS has led to the discovery that the use of a wCBDC under blockchain technology will speed up the transaction as well as guarantee a level of safety for customers.

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White House Asks Regulators to Enforce Crypto Rules Citing FTX Crises

Regulators all over the world have cowered due to the FTX collapse which has caused a further plunge in the digital asset market.


Therefore, there is a call for stricter regulations for cryptocurrencies and their industry. Presently, the Biden administration is reemphasizing its call for more regulations and legislation around digital assets in the United States.

According to White House Press Secretary Karine Jean-Pierre, the Biden administration has never failed to remind its citizens of the impending risk and uncertainty associated with trading cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and others due to their volatility and exposure to cyber crimes. Using FTX implosion as a yardstick, Jean-Pierre reiterated the need for core crypto regulations.

“The administration has consistently maintained that without proper oversight cryptocurrencies risk harming everyday Americans,” Jean-Pierre said during a White House press briefing which was held on Thursday “This is something that clearly we monitor and that we see as an important issue. The most recent news further underscores these concerns and highlights why prudent regulation of cryptocurrencies is indeed needed.”

As such, the White House is keeping an eye on the Bahamian crypto exchange situation.

Joe Biden Signs Executive Order For Crypto Regulation 

In March, President Joe Biden signed an executive order which served as further regulation of the crypto industry especially, as it concerns digital asset trading in America. Although at that time, the country was seeking means to ensure that war-ladened Russia did not evade sanctions through the use of digital currencies. Now, the executive order holds a broader perspective for the crypto industry. 

A few core areas that were referred to in the executive order are the use of crypto for terrorism financing, cyber attacks, and scams and the effects on the American financial economy. The executive order was a drive for the appropriate government agencies to work with other foreign entities to create policies and regulate the crypto ecosystem. 

Binance bail out from FTX acquisition after receiving the result of corporate due diligence has turned out to be an earthquake for the former crypto ecosystem ‘saviour’. More so, FTX Chief Executive Officer (CEO) Sam Bankman-Fried was an active voice that represented the nascent crypto industry at Capitol Hill while always speaking of his vision for the regulation of crypto.

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Despite Closed Door, Justin Sun Says He’s Ready to Inject Billions into FTX – Report

The distress of FTX Derivatives Exchange and Sam Bankman-Fried’s call for help might be coming off with an impressive turnout as Justin Sun, the founder of the Tron blockchain has revealed his intentions to bail out the firm.


Speaking in an interview with BloombergTV’s Tom Mackenzie, Sun said he is ready to inject billions into FTX. While he pointed out that now is the time for the industry to come together and show solidarity, he said the purported aid will have to come following the conduction of full diligence.

Of all the major leaders in the crypto space, Sun comes off as the major person that has identified with the plight of Bankman-Fried. He unveiled plans to resume withdrawals for TRX, SUN, HT, and other tokens in the Tron Ecosystem. 

This is a relatively rare aid at a time when industry veterans are vocally bailing out on the embattled exchange. Binance, the bigger rival was looking at acquiring the trading platform and aiding it to survive its current liquidity crunch pulled away from the deal after a brief Due Diligence was conducted and indications that FTX might be under investigation by US regulators.

Since Binance pulled away, there has been no apparent aid from the exchange to date, a move that has characterized the broader industry. FTX reportedly asked for help from obviously liquid entities like Tether Holdings Ltd, the blockchain firm that is in charge of issuing the USDT stablecoin. 

As revealed in a tweet from Tether’s CTO, Paolo Ardoino, the stablecoin firm denied the aid for $1 billion from the Bankman-Fried-led exchange.

“Tether does not have any plans to invest or lend money to FTX/Alameda. Full stop,” Ardoino said in the tweet.

It remains unclear why the hash stance was taken by the Tether CTO but it might be as a result of the allegations that Bankman-Fried is always lobbying against industry players and the legal hurdles Tether has faced amongst the regulators now reportedly investigating FTX.

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DeFi Platform DFX Finance Says it Has Been Hacked for $7.5M

DFX Finance, a stablecoin trading platform that is backed by Polychain Capital and True Ventures has confirmed that it has been hacked for $7.5 million.


The trading platform said the exploit started around 7:21 PM UTC on Thursday and that it was notified of the exploits about 20 – 30 minutes after the first transaction was initiated.

DFX Finance said it took a proactive stance to halt the operations of its smart contracts in order to contain the attack. By reason of its intervention, the hacked protocol said the attacker was unable to move all of the stolen funds as an MEV bot intercepted as much as $3.2 million of the funds.

The hacker however bolted with some funds which were sent to Tornado Cash, the crypto-mixing service that was sanctioned by the United States Treasury Department. The DFX Finance attacker was able to get his hands on the funds based on a vulnerability in its flash loan protocol.

As detailed by BlockSec researchers, the attacker borrowed funds from DFX Finance on the Ethereum blockchain and immediately deposited the funds back using an “insecure callback function.” This tricked the protocol to think the funds have been paid when indeed they had not. 

“When a user borrows money, the protocol should not allow any function calls that can change the balance of the DFX protocol,” BlockSec CEO Yajin Zhou told The Block.

The attacker succeeded in carting away 2,963 ETH (worth about $3.8 million) and some $500,000. DFX Finance said its Polygon pool was not impacted, however, the protocol said once it opened withdrawals, all should try to take advantage of the allowance to get out their funds.

For the umpteenth time, a DeFi protocol has been hacked again, underscoring the call for caution amongst investors and proper security provisions across the board.

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Coinbase Says Goodbye to Over 60 Employees

Crypto exchange Coinbase Global Inc has announced a fresh job cut of over 60.

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The job cut from its recruiting and institutional onboarding teams has come during a time when the crypto market has gone silent due to the dramatic financial crisis of crypto exchange FTX that involved more than one party.

Furthermore, this is the second round of job cuts at Coinbase this year, which has come about a week after “crypto market headwinds” contributed to the US-based crypto exchange’s net loss of $544.6 million for the three months ended September 30. In comparison to last year, the company had made a profit of $406.1 million.

According to a spokesman from Coinbase, the company believes that the job cuts will help smoothen the operation as efficiently as possible.

Coinbase cut off a total number of 1,100 jobs or 18% of their workforce in June. The move had come about a week after the company had announced an extension of the hiring freeze and a rescinding of accepted offers.

Previously, CEO Brian Armstrong had said that Coinbase had “overhired” and had to purge its workforce accordingly.

The crypto industry has suffered this year due to the higher interest rates and worries of an economic downturn. Major crypto companies such as Voyager Digital, Three Arrows Capital and Celsius Network have already collapsed and are facing bankruptcy.

The crypto exchange seems to be struggling in this year’s bear market. Its quarterly revenue is down 28%, and trading volumes fell 27% during Q3 in 2022. While the company’s stock is also down nearly 80% this year and down 27.4% this month alone.

Another top company involved in the web3 space has cut off a big number of jobs. Facebook parent company Meta Platforms Inc has confirmed the cut of 11,000 jobs or 13% of its global workforce as it seeks to focus on its core business areas. 

Its metaverse engagements have taken a big hit since the company started investing in the space. As reported by Blockchain.News, Meta’s metaverse division recorded a $3.7 billion loss in the third quarter (Q3) of this year, a figure that has further highlighted the capital frailty of the company.

The recorded metaverse loss and the aftermath bordering on staff layoff might stir a significant slowdown amongst Web2 companies looking to make their forays into the metaverse.

The rationale is very simple and is bound to be hinged on the fact that if Meta Platforms could run at a loss with their massive capitalization, then the discovery of the company is more or less a gamble that may need to be waited out.

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It is High Time to Rethink Holding Strategies as FTX Crisis Roams, Says CEO

Speaking on CNBC’s “Closing Bell” Thursday, Peter Smith deemed the collapse of crypto exchange FTX as “a tragedy and total failure of governance.”

The CEO and co-founder of crypto exchange noted that there is a need for crypto investors to go back to the drawing board and hold their assets on their own private keys.

Smith explained:

“Crypto is one of the very few assets in the world that you can custody yourself, and I think we’re going to see folks increasingly move back to that model as well as move to a model of trusting regulated companies in the space.”

He added:

“The ultimate reality and the coolest part of crypto is that you can store your funds on your own private key where you have no counterparty exposure.”

The liquidity crisis facing FTX will also include various measures incorporated into the crypto ecosystem, the CEO pointed out. 

For instance, a trend towards regulated cryptocurrency institutions will be the norm, and more crypto investors will emphasise corporate structure.

Smith highlighted that FTX was significantly popular within Silicon Valley-based groups. As a result, it did not emphasise the cryptocurrency economy significantly. He noted:

“This was very much a Silicon Valley momentum play, and we’ve seen that very clearly not work out.”

Some analysts believe Coinbase will be among the major beneficiaries when the greater focus is on regulated crypto entities. 

The proof-of-reserves concept is also making circles in the crypto space with the aim of rendering more transparency, Blockchain.News reported.

A proof-of-reserve uses a Merkle or Hash tree for data verification, synchronisation, integrity, and transparency purposes. “What is Proof-of-Reserves? An audit by a 3rd party ensuring that a custodian holds the assets it claims to. A snapshot of all balances held is taken & aggregated into a Merkle tree, a privacy-friendly data structure encapsulating balances,” Crypto exchange explained.

Binance CEO Changpeng Zhao (CZ) prompted the proof-of-reserves trend because it would propel more transparency in crypto exchanges by pointing out their digital asset holdings. 

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Bitcoin Gains Momentum Based on Positive CPI Numbers

After slipping to lows of $15.5K amid FTX’s liquidity crunch, Bitcoin (BTC) gained momentum due to better-than-expected consumer price index (CPI) numbers released by the U.S. Bureau of Labor Statistics.

Crypto and market education platform IncomeSharks tweeted:

“Bitcoin has an easy path back to $20k as Stocks pushing up and positive CPI numbers.”

Bitcoin was up by 3.78% in the last 24 hours to hit $17,281 during intraday trading, according to CoinMarketCap

The CPI surge was lower than expected because it rose by 0.4% in October, the lowest since January 2022. The U.S. Bureau of Labor Statistics pointed out:

“The all items index increased 7.7 percent for the 12 months ending October, this was the smallest 12-month increase since the period ending January 2022. The all items less food and energy index rose 6.3 percent over the last 12 months … all of these increases were smaller than for the period ending September.”

The lower CPI numbers triggered a bullish reaction in the BTC market because this might mean that the Federal Reserve (Fed) will ease interest rate hikes, which have been detrimental to the crypto ecosystem.

The Fed has been increasing interest rates to the tune of 75 basis points (bps), and this is one of the primary factors hindering a significant leg up for cryptocurrencies.

Despite the positive CPI numbers, the crypto market is still not out of the woods yet as bears continue to bite. Market insight provider Material Indicators explained:

“CPI was lower, Jobless Claims were higher. FireCharts shows the crypto market’s initial reaction to a beat on the forecasted economic numbers. Bear Market Rally is still alive BTC.”


Source: MaterialIndicators

The collapse of FTX, one of the leading crypto exchanges, has also made the digital asset space shaky.

Reportedly, the liquidity issue facing FTX might have emanated from the exchange’s CEO, Sam Bankman-Fried, secretly transferring at least $4 billion to boost its trading arm Alameda Research, with part of the funds being customer deposits.

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BlockFi Suspends Withdrawals Following FTX Crisis

Crypto lender BlockFi has suspended business following the collapse of crypto exchange FTX.

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The company announced on Twitter that they have suspended withdrawals and normal business operations due to the lack of clarity around the current status of FTX.

“We are shocked and dismayed by the news regarding FTX and Alameda,” BlockFi said late Thursday on its Twitter account, becoming the latest casualty of the sudden fall of Sam Bankman-Fried’s FTX. Alameda Research is an affiliated trading firm also controlled by Bankman-Fried.

BlockFi, which is currently caught in a financial conundrum, was once worth $3 million.

The company took to Twitter to announce that platform activity will be limited for the time being and withdrawals for clients will be suspended “as is allowed under our terms.”

BlockFi has not announced any exact time frame for service restoration.

However, the crypto lender announced through Twitter that ACH deposits and “wire transactions scheduled for 11/11 will not process until 11/14.”

In July, the embattled crypto lender suffered a liquidity crisis after steep declines in crypto prices, which engulfed many lenders.

The crypto lender had brokered a $680 million deal with FTX.US, which included a $400 million revolving credit facility and an option for FTX to buy BlockFi.

While in June, the crypto lender had sought to raise money at a reduced valuation of about $1 billion, a $2 billion decrease from its original valuation of $3 billion in March 2021.

Crypto lenders have had a bad year due to the crypto market downturn. Additionally, the collapse of the TerraUSD stablecoin in May was a catalyst that caused the domino effect. It led to the implosion of other crypto lenders such as Celsius Networks and hedge fund Three Arrows Capital.

BlockFi suffered an $80 million hit from the bad debt of Three Arrows.

FTX has witnessed a sudden collapse this week after the crypto exchange was swamped by client withdrawal requests over the weekend.

According to The Wall Street Journal, FTX’s financial crisis has driven the company into near insolvency as it had lent billions of dollars in customer assets to fund risky trading bets by Alameda. It set the scene for FTX’s implosion.

Furthermore, the downfall of FTX has also affected other major crypto firms, such as, who has suspended deposits and withdrawals of two stablecoins, USDC and USDT, on the Solana blockchain on Wednesday.

Bankman-Fried has informed investors that the crypto exchange would need to file for bankruptcy if it fails to procure a cash injection, according to Bloomberg, who received this information from a person with direct knowledge of the matter.

Bankman-Fried – who was once worth $26 billion – also informed them that his crypto exchange faces a shortfall of up to $8 billion and is in need of $4 billion to remain solvent.

Bankman-Fried, until recently, had been buying up crypto firms struggling due to a credit crunch caused by the sudden collapse of the cryptocurrencies Luna and UST or TerraUSD.

FTX is now on a mission to raise rescue financing in the form of debt, equity or a combination of both, the person familiar with the matter informed Bloomberg.

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Was the Secret Transfer of $4 Billion to Alameda, FTX’s Undoing?

The liquidity crunch facing FTX might have emanated from Sam Bankman-Fried, the crypto exchange’s CEO, secretly transferring at least $4 billion to boost Alameda, with part of the funds being customer deposits, according to Reuters.

Per the report:

“Seeking to prop up Alameda, which held almost $15 billion in assets, Bankman-Fried transferred at least $4 billion in FTX funds, secured by assets including FTT and shares in trading platform Robinhood Markets Inc. Bankman-Fried did not tell other FTX executives about the move to prop up Alameda.”

Lucas Nuzzi, the head of research & development at CoinMetrics, shared similar sentiments and stated:

“I found evidence that FTX might have provided a massive bailout for Alameda in Q2 which now came back to haunt them. 40 days ago, 173 million FTT tokens worth over 4B USD became active on-chain. A rabbit hole appeared.”


Source: LucasNuzzi

FTX’s downfall was also prompted by Bankman-Fried’s decision to save struggling crypto firms as the bear market continued to bite. The report noted:

“Some of those deals involving Bankman-Fried’s trading firm, Alameda Research, led to a series of losses that eventually became his undoing.”

Part of the losses that Alameda Research endured entailed a $500 million loan agreement with collapsed crypto lender Voyager Digital. 

FTX’s future is in jeopardy after Binance halted acquisition plans, citing misappropriation of customer funds, Blockchain.News reported.

Binance disclosed that this decision was reached based on corporate due diligence and reports of alleged U.S. agency investigations and mishandled client funds. 

Based on a shortfall of up to $8 billion, Bankman-Fried acknowledged that FTX needed $4 billion to remain solvent to avoid bankruptcy. 

The rain started beating FTX after experiencing a “giant withdrawal surge” of $6 billion in cryptocurrencies in just 72 hours. The crypto exchange was accustomed to daily withdrawals that amounted to tens of millions of dollars. 

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