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Welcome to The Node! This is Marc Hochstein to take you through the latest crypto news. In today's news: Caroline Ellison gets two years; a decentralized Zoom?; crypto compliance pros rally for detained Binance executive; Sky (formerly MakerDAO) reconsiders plan to nix wrapped BTC as collateral. The Takeaway: Retail bitcoin investors, particularly "crabs" and "shrimps," have accumulated 35,000 BTC in the past 30 days, highlighting increased confidence and participation from smaller holders, writes CoinDesk's James Van Straten.👇 |
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Caroline Ellison Sentenced to Two Years |
Former Alameda Research CEO Caroline Ellison was sentenced to 24 months in prison by a federal judge on Tuesday. The judge said Ellison, 29, who will also have to forfeit her assets, could serve the sentence at a minimum-security facility near Boston, where her family lives. She will also spend three years on supervised release after she serves her term. Despite the sentence, Judge Lewis A. Kaplan sounded sympathetic to Ellison, who was a key witness in the government’s trial against Sam Bankman-Fried – the founder and CEO of FTX and a former boyfriend of Ellison’s. "You were vulnerable and you were exploited," he said minutes before announcing his sentence. "You are genuinely remorseful." Kaplan noted Ellison’s cooperation, saying "I’ve seen a lot of cooperators in 30 years here, I’ve never seen one quite like Miss Ellison." Nevertheless, FTX was one of the greatest financial frauds ever perpetrated in this country, he noted, and cooperation wasn’t enough to spare Ellison a prison term. "In a case this serious, to be literally a 'get out of jail free' card is not something I can see my way through to," Kaplan said. |
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Huddle01, a blockchain project to provide decentralized audio and video conferencing – aiming to provide lower-latency virtual meetings than Zoom and Google Meet – plans to raise as much as $37 million in a sale of network nodes. The 49,600 "media nodes" being sold offer operators a way to contribute excess internet bandwidth to the communication network, in exchange for token rewards. According to a "lite paper," some 21% of the project's HUDL tokens will be distributed to media nodes. Huddle01 is built using technology borrowed from the Ethereum layer-2 network Arbitrum. The first sale of up 20,000 nodes, which would cost a total of $8 million, is set to begin in early November, with a whitelist sale starting on Nov. 6 and a public sale on Nov. 8, according to a press release shared exclusively with CoinDesk. If those are sold out, subsequent nodes could be sold to reach as much as $37 million. Huddle01 becomes the latest in a growing trend of blockchain projects conducting node sales as a way to raise funds while simultaneously decentralizing their networks. |
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Breaking News: The First 40+ Speakers Announced for Consensus Hong Kong The industry's most influential event in Web3 and digital assets is coming to Asia with a stellar lineup of 40+ global thought leaders already confirmed. Be part of the game-changing discussions, key announcements, and high-impact deals that will shape the future of innovation.
Register todaybefore prices increase and use code NODE15 for an additional 15% off.
Don’t wait—prices increase Friday, September 27 at 11 a.m. ET / 11 p.m. HKT. |
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Crypto Pros Rally for Detained Binance Exec |
A group of former government employees and compliance officials, now working in the crypto industry, rallied in front of the United Nations on Wednesday to show support for Tigran Gambaryan, Binance's head of financial crime compliance who's been detained in Nigeria since February. Gambaryan is being held as a representative of the company he works for, with prosecutors trying him on money laundering charges brought against Binance. He is being held in the Kuje Prison, which is notorious for holding terrorists and other criminals, where his health has deteriorated heavily; in a recent video, he was struggling to walk with a crutch. A spokesperson for his family said he has also suffered multiple infections, as well as a herniated disc in his back. Despite this, the U.S. government only publicly acknowledged his detention earlier this month, though Secretary of State Antony Blinken had discussed Gambaryan with Nigerian officials in May, the New York Times reported. |
Sky Reconsiders Plan to Nix Wrapped BTC |
Sky, the decentralized finance lender previously known as MakerDAO, could consider pausing its plan to offboard wrapped bitcoin (WBTC) as collateral, following a fresh recommendation from an influential advisor. The development follows a lengthy discussion on the Sky discussion forum with Mike Belshe, CEO of BitGo, which was the sole custodian of the bitcoin backing WBTC until August, when a deal was cut to transfer custody to a strategic partnership with Tron founder Justin Sun. WBTC is a token that allows investors to use bitcoin (BTC) on other blockchains, such as Ethereum, and often is at the center of the DeFi lending space as collateral. WBTC currently has a $9.7 billion market capitalization. The influential Sky adviser, BA Labs, had expressed concerns about Sun's involvement with the project – a crucial consideration given that some $200 million of loans on the platform were in some way linked to WBTC collateral. Last week, Sky community members overwhelmingly voted to proceed with the adviser's recommendation to offboard WBTC as collateral, in a five-step process starting in early October. But discussions over the matter continued even after the vote, with Belshe posting extensively in the forum in recent days that the new custody arrangement was misunderstood, and that Sun would not have the ability to singlehandedly make changes to the structure. On Tuesday, BA Labs wrote that "the additional details and clarity put us in a more comfortable position with the current state of WBTC operations and key management." |
The Takeaway: Crabs and Shrimps Are Bullish |
By James Van Straten, senior analyst, CoinDesk In the past 30 days, the Bitcoin (BTC) ecosystem has seen a significant rally in accumulation, with approximately 88,000 BTC being amassed on a net basis. This strong period of accumulation, which has persisted through much of September, is notable for being about seven times the monthly bitcoin issuance of around 13,500 BTC. Such intense accumulation has not been seen since Q4 2023, a period that saw a rapid increase in bitcoin's price. A deeper analysis of this net accumulation reveals that retail investors, particularly smaller holders, are playing a significant role. Investors with less than 10 BTC, often categorized as “crabs” (owning 1 to 10 BTC) and “shrimps” (owning less than 1 BTC), have collectively accumulated 35,000 BTC in the past 30 days. This trend of retail accumulation has been ongoing since May, underscoring the growing confidence and participation of smaller investors in the market. Another factor providing a tailwind for bitcoin's price is the substantial outflow of bitcoin from exchanges. Around 40,000 BTC have left exchanges in the past 30 days, signaling reduced liquidity. When bitcoin is withdrawn from exchanges, it can indicate that holders intend to keep it off the market, reducing selling pressure and creating a bullish environment for future price increases as 74% of the circulating supply is considered illiquid. This combination of retail accumulation and exchange outflows suggests that bitcoin's current momentum could continue to strengthen in the coming months. Read with charts online. |
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“Let's go." "We can't." "Why not?" "It's jail." |
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