Can you take back a gift? FTX thinks so
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Welcome back to Chain Reaction.
Over the weekend, FTX and its affiliated debtors sent confidential letters asking politicians, PACs and other recipients of funds to return donations made by the crypto exchange once valued at $32 billion.
Even if the recipients used the money for payments or donations, FTX wants them to regather the funds and send ’em back.
The group, self-dubbed “FTX Debtors,” did not disclose which parties were involved, but said letters were sent to recipients that received payments from FTX debtors or the exchange’s former CEO, Sam Bankman-Fried, among others.
The majority of Bankman-Fried’s donations were traced to Democrats, but he also claimed in an interview with reporter Tiffany Fong that he donated “about the same amount” to the Republican Party as well. “That was not generally known,” he added.
The biggest single recipient was Protect Our Future, a PAC that aims to “help elect candidates who will be champions for pandemic prevention.” The group got $28 million from Bankman-Fried, according to OpenSecrets.
He also contributed donations to Democratic Senators Debbie Stabenow, Kirsten Gillibrand, Maggie Hassan and Cory Booker, as well as Republican Senators John Boozman, Lisa Murkowski and Susan Collins.
The deadline to return funds is at the end of the month, so candidates and political groups may come forward in response to the request. Whether those donations are returned has yet to be determined, and this may be just one step in a prolonged, lengthy legal case for FTX to claw back funds.
This week in web3
FTX’s attempts to claw back political donations may target largest recipients, experts say (TC+)
As mentioned above, FTX and affiliated debtors sent confidential letters to politicians, PACs and other recipients of donations to return the funds given by the formerly massive crypto exchange. It might seem like an odd request, but it was unsurprising to some legal experts who keep tabs on the space. The main targets for donation returns will be larger recipients, where potential litigation (if needed) will be worth it, Yesha Yadav, professor of law at Vanderbilt University, told TechCrunch.
NFT market shows signs of recovery as January trading volumes hit 7-month high
It appears the NFT market is slowly getting back on its feet. Trading volumes rose for two months straight, with January scoring the highest volumes since June last year, according to the Dapp Industry Report: January 2023. The growth in January marked a stark difference from the trend of the past few months — October saw trading volumes dip to a low of $662 million — but in November, the market halted the downward trend to stay at $662 million, per the report.
Bitcoin holding above $20,000 offers miners hope as margins become healthier (TC+)
Bitcoin has had a strong rally so far this year, and some mining experts see this as an opportunity for the space to stage a comeback. Bitcoin’s price has increased about 39% to around $23,000 year to date, according to CoinMarketCap data. That means margins are expanding, said Christian Lopez, director of fintech investment banking and head of blockchain and digital assets at Cohen & Company Capital Markets. “The price of bitcoin is coming up, and energy prices are actually going down, so you’re seeing an increase in margin.”
Binance acquires majority stake in Korean crypto exchange GOPAX
Binance Holdings plans to return to South Korea after pulling out of the market in 2021. The world’s largest cryptocurrency trading platform by trading volume said it had acquired a majority stake in South Korea-based crypto exchange GOPAX. The latest acquisition comes nearly two months after Binance acquired Sakura Exchange BitCoin (SEBC) in Japan for an undisclosed amount as Binance eyes expanding its footprint in the East Asian market again.
In a trademark battle between an NFT artist and Hermès, the artist just lost
Artist Mason Rothschild thought he was sitting on a “goldmine” when he began creating digital versions of the iconic Hermès Birkin handbag and selling these as NFTs. Unsurprisingly, Hermès loved the art project less, and the powerhouse luxury brand just won a copyright infringement case against Rothschild that could have widespread ramifications for NFT creators whose inspiration is real-world goods that are protected by intellectual property laws.
The latest pod
For this week’s episode, Jacquelyn talked to Gwendolyn Regina, investment director at layer-1 blockchain BNB Chain. Prior to her current role, Gwen worked at Facebook, or as some call it now, Meta, building up a new business unit for venture capital partnerships and startup growth. She’s also a founder of a few different businesses and a founding team member for an early-stage tech investment firm Thymos Capital.
BNB Chain was launched in 2020 and initially kicked off by Binance, the world’s largest crypto exchange by trading volume. Since then, BNB Chain aims to be a decentralized, community-owned separate entity from Binance with a focus on three audiences: retail markets, builders and developers and bridging Web 2.0 businesses to web3, Regina shared.
Gaming on BNB Chain also has grown “organically through robustness and cheaper fees,” but the blockchain’s team is now “doubling down” in that sector to encourage more gamers and developers to play and build on its chain, Regina added.
We also discussed:
The dApps developers are building on-chain
BNB’s investing strategy
What investors look for in founders
Advice to startups launching in a bear market
Subscribe to Chain Reaction on Apple Podcasts, Spotify or your favorite pod platform to keep up with the latest episodes, and please leave us a review if you like what you hear!
Follow the money
Coincover raises $30 million to help protect digital assets from hacks and human error
Sesame Labs raises $4.5 million to help improve web3 marketing tools
Dymension raises $6.7 million to help scale Cosmos ecosystem
Blockchain data intelligence platform Elementus raises $10 million to grow chain accessibility
VRRB Labs raised $1.4 million in pre-seed funding to develop a blockchain that helps developers build user-friendly applications
This list was compiled with information from Messari as well as TechCrunch’s own reporting.
Can you take back a gift? FTX thinks so by Jacquelyn Melinek originally published on TechCrunch