Paxos’ $500K Bitcoin fee, FTX tokens sales set to begin, and more

Top Stories This Week

Paxos confirms it’s responsible for paying a $500K Bitcoin transaction fee

The Bitcoin miner who received 19.8 BTC in fees from blockchain infrastructure firm Paxos has returned the funds following Paxos’ claim that it made a mistake in paying over $500,000 in transfer fees. On Sept. 10, Paxos paid the six-figure fee to move $2,000, with the average network fee typically being around $2. The company later acknowledged the mistake, confirming the transfer came from its servers. Almost a day after Paxos’ claims, the Bitcoin miner who received the funds went on X (formerly Twitter) to express frustrations after agreeing to refund the amount to Paxos. The funds were returned on Sept. 15.

Court approves sale of FTX digital assets

A bankruptcy court has approved the sale of FTX digital assets in weekly batches through an investment adviser and under preestablished guidelines. The sale does not include Bitcoin, Ether and “certain insider-affiliated tokens,” which can be sold through a separate decision by FTX after 10 days’ notice. FTX sales are not expected to have a heavy impact on markets. According to a recent shareholder update, the bankrupt exchange has $833 million worth of Bitcoin and Ether. A total of $3.4 billion is held in Digital Assets A — the top 10 assets the company holds — which include Solana, Bitcoin, Ether, Aptos and others.

Gemini Earn users could recover all funds in new DCG remuneration scheme

Digital Currency Group has proposed a new agreement plan for the creditors of the now-bankrupt Genesis Global. The plan estimates unsecured creditors will receive “a 70–90% recovery with a meaningful portion of the recovery in digital currencies.” Additionally, the remuneration plan says the recovery of claims for Gemini Earn users would be projected at “approximately 95–110%” without any contribution from Gemini. According to the filing: “If Gemini were to agree to provide $100 million to Gemini Earn users under the Proposed Agreement, as it previously did, there would be little doubt Gemini Earn users would receive more than full recovery.”

Franklin Templeton files for spot Bitcoin ETF

Asset manager Franklin Templeton applied with the United States Securities and Exchange Commission to launch a spot Bitcoin exchange-traded fund (ETF). According to the application, the fund would be structured as a trust. Coinbase would custody the BTC, and The Bank of New York Mellon would be the cash custodian and administrator. Franklin Templeton has $1.5 trillion in assets under management and joins a long list of asset managers waiting for regulatory approval. The SEC recently delayed decisions on spot ETF applications from WisdomTree, Valkyrie, Fidelity, VanEck, Bitwise and Invesco on Aug. 31.

Two more top executives depart Binance.US amid layoffs, SEC action

The exodus of executives from crypto exchange Binance has reached the firm’s offshoot in the United States, as at least three top employees left Binance.US over the past few days. This week’s departures included the exchange’s CEO, Brian Shroder, alongside legal head Krishna Juvvadi and chief risk officer Sidney Majalya. The mass exit is believed to be tied to the ongoing U.S. investigation into Binance and Binance.US. The SEC sued Binance.US, Binance and CEO Changpeng Zhao in June for allegedly engaging in unregistered securities operations and other improprieties. On Aug. 28, the agency requested to file sealed documents in the case, fueling concerns about a criminal probe by the U.S. Department of Justice.

Winners and Losers

At the end of the week, Bitcoin (BTC) is at $26,465, Ether (ETH) at $1,628 and XRP at $0.50. The total market cap is at $1.05 trillion, according to CoinMarketCap.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Toncoin (TON) at 21.30%, VeChain (VET) at 11.94% and Bitcoin Cash (BCH) at 11.36%. 

The top three altcoin losers of the week are ApeCoin (APE) at -16.82%, Astar (ASTR) at 14.47% and Flare (FLR) at 12.61%.

For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“I think my generation and younger than me are the ones that are really going to change that narrative for investing, whether it’s in cryptocurrency or other investments moving forward.”

Scotty James, Australian snowboarder

“The only country I would not encourage you to start a company right now is in the U.S.”

Brad Garlinghouse, CEO of Ripple

“We’re still in the fax era of global payments.”

David Marcus, former PayPal executive and co-founder Lightspark

“I don’t think everybody in D.C. actually fully realizes how powerful the crypto voting community block is.”

Brian Armstrong, CEO of Coinbase

“You cannot get 100% transparency and 100% privacy.”

Alex Svanevik, CEO of Nansen

“Climate change is still a systemic threat to our species. I think as a society, we kind of owe it to ourselves to do anything that we can.”

Marek Olszewski, CEO of Celo

Prediction of the Week 

Bitcoin price all-time high will precede 2024 halving — New prediction

Bitcoin has a $250,000 target for after its next block subsidy halving — but new all-time highs will come sooner, according to the latest BTC price prediction from BitQuant, a popular social media commentator who sees a rosy future for the largest cryptocurrency.

On Sept. 15, the pseudonymous “central banker and Bitcoiner” revealed a pre-halving target above $69,000. “No, Bitcoin is not going to top before the halving,” he wrote in part of the commentary.

Bitcoin has just over six months before the halving, the event that cuts miner rewards earned per block by 50% every four years. “No, BTC is not going to $160K because the magnitude of every pullback is large,” he wrote, adding that “this means it will peak after the halving, in 2024. And yes, the target price is around $250K.”

FUD of the Week 

SEC charges company behind Stoner Cats NFT series with unregistered securities sale

Stoner Cats 2 LLC (SC2), the company behind the Stoner Cats animated web series, has agreed to a cease-and-desist order and other measures imposed by the U.S. Securities and Exchange Commission after being charged with conducting an unregistered offering of crypto-asset securities in the form of nonfungible tokens (NFTs). According to the SEC, SC2 sold more than 10,000 NFTs for about $800 apiece. The sale took 35 minutes and occurred on July 27, 2021, and the proceeds were used to fund the series. Besides agreeing to the cease-and-desist order, SC2 will pay a civil penalty of $1 million.

OneCoin co-founder Greenwood gets 20 years in US jail for fraud, money laundering

Karl Greenwood, co-founder of OneCoin with Ruja Ignatova, was sentenced in the United States to 20 years in prison and ordered to pay $300 million on Sept. 20. Ignatova remains at large. Greenwood, who is a citizen of the United Kingdom and Sweden, was sentenced in a court in New York. In a statement by the Justice Department, U.S. Attorney Damian Williams called OneCoin “one of the largest fraud schemes ever perpetrated.” The multilevel marketing and Ponzi scheme reaped $4 billion from 3.5 million victims, the statement said. Ignatova has not been seen since October 2017 and is on the U.S. Federal Bureau of Investigation’s Ten Most Wanted List.

North Korea’s Lazarus Group responsible for $55M CoinEx hack

The attack on crypto exchange CoinEx, which drained at least $55 million, was carried out by the North Korean hacker group Lazarus, according to blockchain security firm SlowMist and pseudonymous on-chain investigator ZachXBT. The hacker group was identified after it inadvertently exposed its address, which was the same one used in the recent Stake and Optimism hacks. On Sept. 12, CoinEx saw large outflows of funds to an address without any prior history. Security experts immediately suspected that the exchange was breached, with initial estimates reaching approximately $27 million.

Are DAOs overhyped and unworkable? Lessons from the front lines

Many contend that DAOs have failed to deliver on their promises, but developers are coming up with novel solutions.

6 Questions for Kei Oda: From Goldman Sachs to cryptocurrency

Kei Oda spent 16 years trading bonds for Goldman Sachs — a life that eventually bored him. That was when he turned to cryptocurrency.

Web3 Gamer: PUBG devs’ Web3 project, Animoca’s $20M raise, Shardbound review

The company behind PUBG announces a new Web3 platform, monetization in Web3 and more.