GM, frens! Ambire here with our weekly newsletter. This week we’ll be talking about SBF’s trial and how his ex GF ‘betrayed’ him in court, USDR depegging from $1, Web3 on Fire’s latest podcast episode, crypto humanitarian aid usecase with recent conflict in israel and Binance getting in trouble again, this time in Brazil. Let’s get down to it:

SBF's GF betrays him in court

SBF's trial is gathering more attention as Caroline Ellison, his former associate and ex-romantic partner, testified against him in court. Her revelations have shed light on the events leading to the implosion of FTX last November and SBF's subsequent arrest.

Ellison said that SBF has directed her to misappropriate billions from FTX customers, using their funds to cover Alameda's debts.

Her testimony aligned with earlier statements made by Gary Wang, co-founder of FTX and Alameda, who revealed that Alameda had unrestricted access to FTX customer funds, with SBF orchestrating the setup. This raised further questions about SBF's role and responsibility in the misappropriation of funds.

SBF's defense attempted to shift some blame back onto Ellison, stating that SBF had urged her to hedge against cryptocurrency price fluctuations, which she allegedly failed to do.

Ellison's background as a quantitative trader and her previous work with SBF at Jane Street Capital have made this betrayal all the more shocking. After co-founding Alameda, she was hired in 2018 and eventually became CEO in 2021.

During her tenure, Ellison received a substantial salary and bonuses from Alameda, while SBF continually pushed for increased borrowing capacity for more trades and investments. This led to the misuse of FTX customer funds, with Ellison expressing concerns during an audit but being reassured that auditors would not investigate.

Her testimony also revealed that FTX had provided multimillion-dollar loans to FTX executives, including SBF, which she signed on behalf of Alameda. These loans were used for a gambling startup and political donations.

As the trial continues, more details are expected to emerge, and the implications for both SBF and Ellison remain uncertain. We'll keep watching as the story unfolds.

Meanwhile, amidst the ongoing trial, the alleged "hacker" associated with FTX has begun transferring the pilfered assets. The transactions, totaling $477 million, have sparked speculation within the community about the possible connection between this hacker, SBF, and the misallocation of funds.

Another DeFi stablecoin depegs

Most of us have probably thought that the worst effects of crypto winter are over, however, recent events have proven otherwise when another stablecoin lost its peg to the US dollar. Stablecoins are designed to maintain a stable value of $1, but the depeg events of 2022-2023 have shown that this is not always the case.

The latest stablecoin to lose its peg is Real USD (USDR), a Polygon-based coin backed by real estate assets. Currently trading at $0.54, it has fallen significantly from its intended value of $1.

The reason behind this depeg event lies in the management of USDR's treasury. The treasury was mostly backed by other tokens which have also fallen below their intended value, resulting in a depletion of funds.

The remaining amount in the treasury, worth around $6.2 million, was simply not enough to support the circulation of 45 million USDR coins and maintain its peg to $1.

To make matters worse, the treasury also relied on another token called Tangible (TNGBL) for support. However, this token has also experienced a drastic decline, which further added to the instability of USDR.

This week’s Web3 on Fire Podcast: DAO Legal Structures, Present, Past, & Future

In the latest episode of the Web3 on Fire podcast, our host Rob Edwards invites Adam Miller, CEO and Co-Founder of MIDAO, to demystify the complex world of Decentralized Autonomous Organizations (DAOs). This episode dives into the mechanics of DAOs and explores their legal landscapes and the profound implications they hold for the future of digital collaboration.

Listen to this week’s episode now (and make sure to give it a follow so you never miss an episode):

Crypto aid saves lives during Israel conflict

When people argue about use cases for crypto, they usually talk about its potential to revolutionize the financial industry or disrupt traditional forms of currency. However, one often overlooked aspect of cryptocurrency is its ability to facilitate humanitarian aid in times of crisis.

The recent outbreak of war between Israel and Hamas has highlighted this potential as multiple crypto firms have come together to establish Crypto Aid Israel. This organization will collect donations in various cryptocurrencies, including bitcoin (BTC) and ether (ETH), as well as stablecoins such as USDT and USDC, to provide aid for Israelis who have been displaced and in need of assistance.

The difference is that people from all over the world would be allowed to quickly deposit their donations into the multi-signature wallet, controlled jointly by multiple parties. This ensures transparency and accountability in the distribution of funds.

To further facilitate this process, numerous Israeli banks and regulators have stepped in to assist with the flow of crypto donations for the first time. This shows a growing acceptance and recognition of cryptocurrency as a legitimate form of value.

Fireblocks, a leading crypto safekeeping firm, has also joined forces with Crypto Aid Israel to manage the donated assets. A strict policy has been implemented that requires at least four out of seven signatories to move funds out of the wallet.

The members of this alliance, which include Fireblocks, MarketAcross, Collider Ventures, CryptoJungle, and Israel Blockchain Association, hope to raise enough funds to provide basic necessities for affected families and bring awareness to the ongoing crisis.

This initiative not only showcases the potential of crypto as a tool for humanitarian aid but also highlights the power of the crypto community. By coming together and leveraging our technological advantage and networks, we are capable of making a positive impact in most areas of society.

Binance is in trouble again.. this time in Brazil

Brazil has emerged as a hotbed for cryptocurrency trading and investment in recent years. With its growing economy and increasing interest in digital assets, the Latin American country has become an attractive market for cryptocurrency companies like Binance. However, this popularity has also brought scrutiny from Brazilian authorities.

In a recent development, a congressional committee in Brazil released a 508-page report that made allegations against Binance and its CEO, Changpeng Zhao. The report accuses Binance of running a pyramid scheme and operating without proper adherence to local financial regulations. It also brings attention to CZ's establishment of multiple companies in Brazil as a means to evade compliance with the law.

The committee's findings highlight several issues with Binance's operations in Brazil, including lack of supervision and control over user transactions. It also mentions an alleged statement from Binance's chief compliance officer, suggesting a deliberate approach to avoid regulatory costs.

As a result of these allegations, the committee has recommended charges against three prominent figures associated with Binance - CEO Changpeng Zhao, Brazil's General Director Guilherme Haddad Nazar, and Latin America's Institutional Relations Director Daniel Mangabeira. The report also reveals that Binance has conducted transactions worth USD $791 million without proper regulatory oversight.

While these charges are still just recommendations and subject to further investigation, such huge accusations from a congressional committee cannot be taken lightly.

Other worthy reads

Data shows users have faith in gold-based crypto assets:

TVL based metrics from Prithvir:

Arbitrum grants voting ends today:

The fun page

That's all for now, frens.

We'll see you next week. And remember, the market conditions are temporary, but our commitment to building a better DeFi is here to stay. Thanks for joining us, and we look forward to seeing you back next week. Cheers!

Yours, The 🔥 Team

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