Author: Chris Lion

Despite SHIB’s performance, whales have been actively accumulating the token in May.

Shiba Inu (SHIB) whales have collectively accumulated 30 trillion SHIB ($734 million) tokens despite the recent decline in crypto price. 

The development was shown by their massive accumulation of trillions of SHIB tokens in May, betting on the token’s long-term potential, despite the meme coin’s 11% drop from March highs, now trading at $0.000024.    

After hitting a local high of $0.0000457 on March 5, SHIB’s price has dropped sharply to around $0.000024. The decline has led to a monthly loss of over 11% despite the resurgence in meme coin popularity—even the approval of a spot Ethereum ETF hasn’t sparked buying interest, leaving SHIB primarily unaffected.   

Whale Accumulates 30 Trillion SHIB Tokens

Despite the performance, IntoTheBlock data indicates that Shiba Inu Whales have been actively accumulating the token throughout May.  

Massive whale transactions have gathered 30 trillion SHIB tokens this month, positioning the second-largest meme coin by market capitalization as one of the most actively traded tokens by whales. On May 20, whales collected 1.7 trillion SHIB tokens ($41 million). The whale accumulation indicates strong confidence in SHIB’s long-term potential, with these entities likely positioning themselves for an anticipated future uptrend.   

SHIB Updates: Coinbase, Burn Rate, and Beyond 

At the beginning of this week, Coinbase revealed plans to expand its services by introducing perpetual futures contracts for SHIB. The crypto exchange platform supported popular meme coins like Bonk Inu (BONK), Floki Inu (FLOKI), and XRP. 

Following the development, SHIB’s trading volume surged by nearly 43% in the last 24 hours, reaching $904.9 billion, according to CoinMarketCap data.  

On May 19, SHIB’s burn rate experienced a remarkable surge of 579%, which indicated a bullish sentiment. The action reduced the meme coin’s market supply by 12.70 million SHIB tokens, boosting its demand.    

As of the time of writing, the SHIB token is the 13th biggest crypto asset by market capitalization, with a market cap of $14.40 billion and a trading volume of $635.63 million. It also has an all-time high of $0.00008616, recorded on October 28, 2021.

Coinbase’s legal officer confirmed that New York users can now trade XRP, after suspending the token since 2021.

America’s largest crypto exchange Coinbase has resumed trading of XRP for its users in New York. The company’s chief legal officer, Paul Grewal, shared the update on X, noting that customers in New York could resume trading XRP on the crypto exchange. 

XRP trading on @coinbase is available again in NY. We heard you and put in the work in strong partnership with the State. And now the word can be put out— we are back up.

— paulgrewal.eth (@iampaulgrewal) May 23, 2024

In late 2020, the United States Securities and Exchange Commission (SEC) filed a lawsuit against Ripple (XRP), claiming that the token was sold as an unregistered security.  

Shortly after the suit, various centralized exchanges in the US, including Coinbase, Bittrex, and Binance.US, suspended XRP trading activities on their platforms.    

XRP and Legal Battles 

Exchanges in the US started relisting XRP after Judge Analisa Torres ruled in 2023 that secondary sales of XRP in the Ripple case did not constitute securities sales. 

Despite the court ruling and its relisting on U.S. platforms, Ripple still faced regulatory difficulties in localities like Japan and New York.   

In September 2023, the New York Department of Financial Services (NYDFS) removed Ripple Labs from its “Greenlist” of firms approved to custody customer assets, which prompted Coinbase to suspend the trading of XRP for New York residents.   

This is because the NYDFS must individually approve crypto firms in New York to act as custodians for customer funds.   

XRP Market Reaction and Implications

The market reaction to the news has been positive. XRP saw a significant uptick in its price following the announcement, placing upward pressure on the daily candle and taking the price from $0.51 to nearly $0.53 at the time of this writing. 

Despite the positive reaction, XRP’s price has steadily declined since reaching a high of $0.74 on March 12, 2024. XRP ranks as the eighth biggest digital asset, with a market capitalization of $29.16 billion and a market volume of $29.16 billion.   

Meanwhile, on April 4, 2024, Ripple announced the launch of a U.S. dollar-backed stablecoin to compete with USD Tether (USDT) and Circle’s USD Coin (USDC).    

The recent transfer would place Bankman-Fried closer to his parents’ residence near Stanford University, about a two-and-a-half-hour drive away.  

Sam Bankman-Fried (SBF), a former crypto giant and founder of the collapsed cryptocurrency exchange FTX, is being transferred to a new prison facility as part of ongoing security and administrative measures.   

According to a spokesman for the jailed FTX founder, the new development overrides his wishes to stay in New York and participate in helping to prepare for his appeal.  

According to Bankman-Fried’s representative, who confirmed the transfer, the destination remains undisclosed.   

SBF Likely to Move to California 

Sources familiar with the story suggest that SBF is likely being moved from the Brooklyn, New York, jail, where he has been for the past nine months, to a federal correctional facility in Mendota, California.  

According to the Bureau of Prisons website, Mendota has medium-security and minimum-security facilities. The relocation would place SBF closer to his parents’ residence near Stanford University, about a two-and-a-half-hour drive away. 

Despite the recommendations, SBF preferred to stay at Brooklyn’s Metropolitan Detention Center (MDC), a mixed-security facility in New York, for easier access to his legal team to handle his appeal.  

New Prison Transfer and Conviction 

At the time of writing, it is yet to be disclosed whether the disgraced FTX founder has left MDC Brooklyn or gotten to his speculated new location in California, where he will continue serving his sentence.   

During the trial, SBF was found guilty of two instances of wire fraud, two instances of wire fraud conspiracy, one count of securities fraud and commodities fraud conspiracy, and one count of money laundering conspiracy.  

The financial misconduct of SBF is considered one of the largest financial frauds in U.S. history. It led to losses of billions of dollars belonging to FTX customers and eventually led to the collapse of the once-crypto giant exchange, which announced bankruptcy in late 2022.  

After his conviction, the former FTX CEO was initially kept in MDC Brooklyn. However, Judge Lewis A. Kaplan of the Southern District of New York canceled his bail early last year regarding accusations of witness tampering.   

On March 28, Judge Kaplan sentenced SBF to 25 years in prison, with three years of supervised release and an $11 billion confiscation. However, he filed an appeal against his conviction and sentence for fraud.  

Meanwhile, Ryan Salame, a former top executive of FTX and a wingman to SBF, will receive his sentencing on May 28 for his role in the collapse of the crypto exchange. Other members of Bankman-Fried’s inner circle, including Caroline Ellison, Nishad Singh, and Gary Wang, who cooperated with authorities, are still awaiting sentencing.

Zhou shared a link to Bybit’s proof-of-reserves (PoR) and a Nansen dashboard, offering a transparent view of Bybit’s financial holdings and the total value of its crypto assets. 

In the latest developments in the crypto space, Ben Zhou, CEO of crypto exchange Bybit, has denied circulating rumors suggesting that the exchange is facing insolvency issues. 

The CEO refuted all insolvency rumors and provided evidence of Bybit’s financial holdings and digital assets.   

On May 23, Zhou took to Twitter and other official channels to address the concerns directly. He claimed that the accusations had no factual basis.  

hearing some rumours about Bybit being insolvent or hacked and etc. Please note that we have updated our POR this month as well as you can view all Bybit wallet through Nansen (Total more than 11B) . None of the rumours that I have see so far have any real facts supporting it,…

— Ben Zhou (@benbybit) May 23, 2024

Bybit’s CEO Releases Proof-of-Reserves 

Zhou shared a link to Bybit’s proof-of-reserves (PoR) and a Nansen dashboard, offering a transparent view of the exchange’s financial holdings and the total value of its crypto assets.    

According to the PoR, it revealed that the trading platform holds assets exceeding 100% of user deposits, ensuring all assets are available for withdrawal.  

The Nansen dashboard disclosed that Bybit’s wallets hold over $11 billion in crypto assets, reflecting the total value of the tokens in Bybit’s provided addresses. However, the analytics platform noted this wasn’t a complete and exhaustive statement of the exchange’s actual assets or reserves.   

Insolvency Rumors and Regulatory Issues 

On May 22, rumors of Bybit’s insolvency circulated on the X platform, fostered by memes from a popular FTX-related post that mentioned Bybit.   

Some users joked about withdrawing funds, while others sought clarity. One user speculated that a bug in an Arkham Intelligence proof-of-reserves graph might have sparked the rumor.  

The graph disclosed that the exchange’s wallet was drained, which raised concerns about a potential hack or insolvency. However, independent assessments of the wallets confirmed that the funds remained intact.   

In addition, Bybit encountered regulatory hurdles earlier this month. On May 16, France’s securities regulator, the Autorité des Marchés Financiers, repeatedly sent a warning that the exchange is not registered as a digital asset provider in the country.

In response, the exchange stated that it is in close collaboration with the AMF and is making ongoing efforts to obtain a license. The company indicated its decision to exit the local market in 2023 to ensure full compliance with local regulations. 

The U.S. prosecutors called for a “just punishment” proportional to the scale of the crime as opposed to Salame’s lawyers, who argued for a sentence of not more than 18 months. 

In a recent turn of events, U.S. federal prosecutors have recommended a prison sentence of five to seven years for Ryan Salame, a former executive of FTX and wingman of the exchange’s co-founder Sam Bankman-Fried (SBF), for crimes that led to the collapse of the company. 

The executive, who held a senior position at FTX, has been accused of multiple charges, including fraud, conspiracy, and violations of federal securities laws. The charges arise from accusations that Salame, in collaboration with other senior officials at FTX, engaged in financial misconduct that eventually led to the loss of billions of dollars of investors’ fund. 

A Just Punishment

On May 21, federal prosecutors submitted a sentencing memo in a Manhattan federal court, calling for a strict sentence for Salame following his guilty plea to committing “illegal practices” related to the misappropriation of FTX investors’ funds.   

According to the court filing, the U.S. prosecutors called for a “just punishment” proportional to the scale of the crime as opposed to Salame’s lawyers, who argued for a sentence of not more than 18 months.  

“The campaign finance offense is one of the largest-ever in American history, and the unlicensed money transmitting business exchanged more than $1 billion without proper supervision,” the prosecutor said.   

Salame’s Inability to Testify 

Salame joined Alameda Research in Hong Kong in 2019 and became CEO of FTX Digital Markets, the Bahamas-based subsidiary.  

On April 1, the U.S. District Court for the Southern District of New York sentenced SBF to 25 years in prison after his conviction on seven felony charges. Salame was the only one who did not testify at Bankman-Fried’s criminal trial.

Salame’s court sentencing is scheduled for May 28 for conspiring with SBF in siphoning over $10 billion of users’ funds. “Only a meaningful period of incarceration can adequately deter the defendant and others and promote respect for the law,” the prosecutor added.  

Caroline Ellison, Nishad Singh, and Gary Wang, other key figures in the FTX fraud, await sentencing.

The AG’s office sued Genesis in October 2023 for allegedly defrauding investors through Gemini Earn.  Genesis neither admitted nor denied the allegations

New York Attorney General Letitia James has obtained a $2 billion settlement from bankrupt crypto lending firm Genesis Global for defrauding investors.   

James disclosed that the settlement marks one of the largest financial recoveries in the history of crypto enforcement. 

Gensis Lied and Cheated Investors

According to a notice issued on May 20, the NY Attorney General announced that a bankruptcy court had approved the $2 billion settlement between authorities and Genesis Global Capital, Genesis Asia Pacific, and Genesis Global Holdco. The settlement mandates the return of funds to Genesis investors and prohibits the company from operating in New York.  

Furthermore, James alleged that Genesis had been “lying and cheating investors” who sent more than $1.1 billion to the exchange through the Gemini Earn program.  

“When investors suffer losses because of fraud and manipulation, they deserve to be made whole,” said Attorney General James. “This historic settlement is a major step toward ensuring the victims who invested in Genesis have a semblance of justice. Once again, we see the real-world consequences and detrimental losses that can happen because of a lack of oversight and regulation within the cryptocurrency industry. New York investors deserve the peace of mind that comes from a properly regulated marketplace, and that is something my office will always act to achieve,” the New York AG added.  

Lawsuit Against Genesis

In October 2023, the New York Attorney General’s office filed a lawsuit against Genesis. The lawsuit was expanded in February against Digital Currency Group (DCG), Genesis, DCG’s CEO Barry Silbert, and Genesis’ former CEO Soichiro Moro for defrauding individuals and institutions of an extra $2 billion.    

Genesis neither admits nor denies the allegations. The suit will proceed against the remaining defendants, including Gemini Trust Company.  

AG James encourages New Yorkers affected by deceptive practices in virtual asset markets to report them to OAG. She also urges crypto industry workers who may have witnessed misconduct or fraud to submit online whistleblower complaints to her office, which can be done anonymously.   

New York AG Goes After Crypto Entities

The NY AG also sued former Celsius CEO Alex Mashinsky for allegedly concealing the platform’s poor financial state. Mashinsky faces criminal charges in the Southern District of New York for securities fraud, wire fraud, and conspiracy, with a trial set for January 2025.  

Similarly, in September 2021, AG James and the SEC secured $479.9 million from GTV Media for unregistered crypto sales.

Factors such as an influx of private market capital, aggressive valuations, and upbeat market sentiment have contributed to the trend of tokens launching with high FDVs.

Leading cryptocurrency exchange Binance has announced plans to unlock low float and high fully diluted value (FDV) tokens worth approximately $155 billion over the next six years. 

What are Low Float and High FDV Tokens?

Low-float tokens refer to crypto assets with a limited or low supply available for trading while high FDV tokens are digital assets with a large supply and a high market capitalization potential. They are often based on vesting, gradually releasing tokens to investors over a predetermined schedule.    

Launching tokens with a low circulating supply has affected the market dynamics, primarily by increasing selling pressures. It is estimated that approximately $155 billion worth of tokens are set to be unlocked over the next six years. Binance believes that participants will be under significant pressure to sell without a corresponding capital inflow. 

In light of this, it is essential to understand token unlock schedules, and tracking them is vital for investors to avoid being caught off guard when the tokens underperform a significant unlock and go below expectations.     

A few factors, such as the influx of private market capital, aggressive valuations, and upbeat market sentiment, have contributed to high valuations and constant selling pressure from token unlock.   

Role of Venture Capital in Crypto Investing

Ventures Capital (VC) funds have progressively solidified their positions as significant underdogs in crypto investing. Despite natural fluctuations and swings in capital invested due to market circles, VC capital inflow into the crypto sphere has steadily increased.   

According to a data report, the total VC funding in crypto projects since 2017 has exceeded $91 billion. As more funds flow through the space consistently and as VCs participate in more deals, they drive up valuations.  As a result, tokens often debut at high prices and valuations due to massive private market raises, making it harder for public investors to profit from future growth. 

The Impact of Aggressive Valuations

Aggressive valuation refers to assigning a high value to an asset, often based on optimistic assumptions about its future performance or growth potential. It can result in a price significantly higher than what might be justified by current financial metrics or market conditions. 

According to Binance, this year’s strong market performance has boosted investor sentiment and led to more aggressive deal-making, with some investors now more willing to invest at high valuations. 

Given the norm of multi-million dollar valuations, VCs risk looking bad to their limited partners (LPs) if they are too discerning, as this could mean missing out on most deals during high activity. While market activity is below the 2022 peak, the number of crypto deals in Q1 remains significant.  

Upbeat market sentiment is a positive outlook among investors, which can lead to increased buying, higher asset prices, and more aggressive investment actions.

Despite the crypto market capitalization moving up to 61% in the first quarter of the year, market sentiment has been positive. 

Head Prosecutor Iheanocho opposed bail and urged the Federal High Court  to deny bail application 

Tigran Gambaryan, a senior executive at Binance has been denied bail by the Federal High Court in Nigeria in money laundering trial. 

According to a local media report, Judge Emeka Nwite denied the bail application, stating that Gambaryan posed a flight risk and would likely flee if released.  

The judge noted that the Binance executive had attempted to secure a new passport, claiming that the previous one was stolen.  

Court’s Bail denial 

The Prosecution Counsel, Ekele Iheanacho, argued that Gambaryan has no significant ties to any Nigerian community and is likely to abscond if granted bail, like his colleague Anjarwalla, who escaped custody on March 22 to Kenya. 

“The fact that the defendant’s passport is with the complainant does not guarantee that he will remain in Nigeria because the defendant is not only an American citizen but also an Armenian citizen by birth,” Iheanacho said. 

He urged the court to deny the bail application and remand him in EFCC custody to ensure his safety and prevent flight risk.   

Details of Charges 

Following the government’s crackdown to strengthen the naira, Binance, and its executives face criminal charges in Nigeria, including tax evasion, currency speculation, and money laundering of approximately $35.4 million.  

According to the Central Bank of Nigeria (CBN), over $26 billion was channeled without a trace through the exchange’s platform.  

Gambaryan pleaded not guilty to tax evasion and money laundering charges brought by the EFCC.  He then sued the Nigerian government, claiming his detention and passport confiscation violated his constitutional right to personal liberty.

Binance CEO Calls for the Release of Gambaryan 

Binance CEO Richard Teng has publicly commented on Gambaryan’s ongoing detention, claiming that the crypto exchange’s compliance officer is “innocent and must be released.” 

 “To invite a company’s mid-level employees for collaborative policy meetings, only to detain them, has set a dangerous new precedent for all companies worldwide,” Teng said. 

Meanwhile, on March 5, Binance announced it would cease all Nigerian naira transactions after delisting all naira trading pairs from its peer-to-peer platform in late February.