Market Analysis Report (04 Jan 2023)

On Tuesday afternoon, U.S. District Judge Lewis Kaplan of the Southern District of New York tentatively set a date for the upcoming trial of former FTX CEO Sam Bankman-Fried, who appeared at an arraignment at the Manhattan courthouse. Bankman-Fried has been charged with eight different counts, including wire fraud and campaign finance violations, and pleaded not guilty to all charges at the start of the hearing. 

Multiple U.S. federal agencies started off the new year by releasing a joint statement on digital assets, reflecting on the controversies that plagued the industry in 2022. The Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) released a joint statement on Jan. 3.

According to a research report by AllianceBernstein, the digital asset market has historically seen strong returns after experiencing “crypto winter,” or periods of market stress. 

Sponsored: Ledger Stax is the go-to digital asset management solution for individuals and businesses who demand the highest level of security and customization. Now available for pre-order, Ledger Stax sets itself apart with its innovative features and sleek design.

Top stories in the Crypto Roundup today:

• Former FTX CEO Sam Bankman-Fried Pleads ‘Not Guilty’ to All Charges

• US Federal Agencies Release Joint Statement On Risks Surrounding Digital Assets

• AllianceBernstein Report: Crypto Industry Has Strong Track Record of Fighting Back

• Research: Centralised Exchange Retrospective – 2022 Review & 2023 Outlook

• Sponsored: Experience Peace of Mind with Ledger Stax’s Secure Digital Asset Management Platform

Former FTX CEO Sam Bankman-Fried Pleads ‘Not Guilty’ to All Charges

 On Tuesday afternoon, U.S. District Judge Lewis Kaplan of the Southern District of New York tentatively set a date for the upcoming trial of former FTX executive Sam Bankman-Fried, who appeared at an arraignment at the Manhattan courthouse. Bankman-Fried has been charged with eight different counts, including wire fraud and campaign finance violations, and pleaded not guilty to all charges at the start of the hearing.

Bankman-Fried was arrested in The Bahamas last month, and is now facing a trial in October, when prosecutors will present evidence alleging that he defrauded customers, investors, and lenders by misappropriating customer deposits and lying about FTX’s financial health.

Bankman-Fried’s lawyers have until April 3 to file a motion to dismiss the case, with a hearing scheduled for May 18. Federal prosecutors will also have the opportunity to respond to the motion and both parties will have the chance to argue their cases at the hearing.

Following his first appearance in court last week, the former CEO was released from custody under a $250 million bond agreement. He made his second appearance in a New York courthouse on Tuesday.

US Federal Agencies Release Joint Statement On Risks Surrounding Digital Assets

Multiple U.S. federal agencies started off the new year by releasing a joint statement on digital assets, reflecting on the controversies that plagued the industry in 2022. The Federal Reserve, Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) released a joint statement on Jan. 3.

In the statement, the agencies detailed the historical challenges facing crypto, and their efforts to maintain sound banking practices in wake of those challenges. “It is important that risks related to the crypto-asset sector that cannot be mitigated or controlled do not migrate to the banking system,” the agencies stated. Of these, eight specific risks were identified, including fraud, volatility and market contagion.

“Based on the agencies’ current understanding and experience to date, the agencies believe that issuing or holding as principal crypto-assets that are issued, stored, or transferred on an open, public, and/or decentralized network or similar system is highly likely to be inconsistent with safe and sound banking practices.”

AllianceBernstein Report: Crypto Industry Has Strong Track Record of Fighting Back

 According to a research report by AllianceBernstein (aka “Bernstein”), the digital asset market has historically seen strong returns after experiencing “crypto winter,” or periods of market stress.

The report notes that despite a slump in the value of Bitcoin last year, it has still increased in value by up to 60 times since its low in 2014 and roughly five times since its low in 2018. Similarly, Ether has increased in value by 14 times since its low in 2018, despite a 68% decline in value last year.

“Crypto is probably among the few industries that can clock frontier-tech-like growth, in a broadly maturing tech landscape,” analysts Gautam Chhugani and Manas Agrawal wrote. Crypto touches less than 5% of total internet users with “significant headroom for application-led adoption.”

The report argues that the crypto industry has a track record of recovering from lows and that the long-term consumer adoption of crypto should continue to be a focus for investors. As blockchains and their applications mature, Bernstein predicts that the monthly user base of the crypto industry could increase by as much as 100 times in the long term, with gaming, social media, and non-fungible token-based digital commerce and brands leading the way.

Research: Centralised Exchange Retrospective – 2022 Review & 2023 Outlook

2022 was one of the most impactful years for centralised crypto exchanges since the collapse of Mt. Gox in 2014, with the fall of FTX raising many questions about the transparency of exchanges and what measures they are taking to protect users.

In our latest report, sponsored by Bybit, we analyse the CEX landscape in 2022, assess market-wide changes in trading volumes, liquidity measures, customer acquisition practices, and provide an outlook on the key trends to look out for in 2023.

For example, we found that Bybit and Kucoin were the only exchanges that saw a rise in trading volume in 2022, highlighting the nascent stage of the industry, where multiple firms can grow despite a broad market downtrend. Zero-fee trading programs also proved to help exchanges gain market share in 2022, with Bybit’s volumes rising 248% the month after incorporating zero-fee trading.

Experience Peace of Mind with Ledger Stax’s Secure Digital Asset Management Platform

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One of the standout features of Ledger Stax is its clear-sign transaction capability, which allows users to easily sign and confirm their transactions. This feature, combined with Ledger’s uncompromising security measures such as secure element technology and a fully isolated environment for private keys, ensures that your digital assets are always protected.

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Whether you’re managing your personal digital assets or running a business, Ledger Stax has you covered. Its compact size and user-friendly interface make it perfect for day-to-day use, and its sleek design ensures that it will fit seamlessly into your digital asset management routine.

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