Crypto Scoop: Crypto Price Predictions, FTX Trial, and Global Adoption Initiatives

This week was a rollercoaster featuring Bitcoin's price fluctuations, market predictions, and revelations about FTX's collapse alongside global crypto adoption. In this edition of the Crypto Scoop, we review

• Price moves and predictions of top cryptocurrencies
• Crypto adoption and initiatives across the globe
• Mastercard’s Wrapped CBDC initiatives
• SBF’s trial reveals FTX collapse detail

Price moves and predictions of top cryptocurrencies

Last week, Bitcoin enthusiasts celebrated as the cryptocurrency soared to $28,000. However, over the course of the week, its price experienced a dip, stabilising at just above $26,000. This drop was not exclusive to Bitcoin, as several other top cryptocurrencies also saw declines, with Ethereum falling to $1,500. 

According to btcparser.com, the trend of dormant Bitcoin transfers from long-inactive wallets, which began in September, has continued. Notably, several wallets from 2014 came alive, moving 860 BTC worth over $24 million in 86 separate transactions on October 4, 2023. Additionally, a 2013 wallet transferred 500 BTC in a single transaction on the same day, while 426 BTC from two 2012 wallets shifted this week.

Amid these developments, some analysts have characterised the current state of Bitcoin's market as a delicate balance between buyers and sellers, neither particularly bullish nor bearish. Andy Bromberg, CEO of Beam, noted, "At the moment, there's a balance, with few newcomers entering into Bitcoin and equally few exiting," creating a relatively stable price.

A report from the Bitcoin-only exchange River revealed that the growth of Bitcoin's Lightning Network has been remarkable, experiencing a staggering 1,212% growth in two years. This surge in Lightning usage is seen as a crucial factor in making Bitcoin a more viable medium of exchange.

Hedge fund giant Paul Tudor Jones has expressed his concerns about the geopolitical risks and rising U.S. government debt levels, stating that these factors make owning stocks a difficult proposition. However, he believes that both Bitcoin and gold offer attractive alternatives, given the current financial climate. BitMEX founder Arthur Hayes has made a bold prediction, suggesting that Bitcoin's price could reach $750,000 to $1 million by 2026. 

In the world of artificial intelligence, OpenAI's CEO, Sam Altman, discussed the nuances of AI on the Joe Rogan Experience podcast. Rogan noted that the “real fascinating crypto is bitcoin.” He then expressed  his belief that Bitcoin holds the most promise to emerge as “a universal viable currency.”

Additionally, during the week, an update was proposed to Bitcoin, BitVM. "BitVM" is a proposal to bring Ethereum-style smart contracts to Bitcoin without adding complexity to the network. BitVM would allow for Turing-complete Bitcoin contracts by conducting computations off-chain and verifying them on-chain, much like Ethereum's approach. This enhances Bitcoin's smart contract capabilities while preventing network congestion. 

While other stakeholders shared their predictions on Bitcoin, Presidential candidate Robert F. Kennedy Jr. promised to end what he refers to as the White House's "war on Bitcoin" if elected President of the United States. He aims to protect individuals' ability to own and transact with Bitcoin.

Bitcoin wasn’t the only star of the show this week. Standard Chartered's research predicts that Ethereum may reach $8,000 by 2026. Eventually, the bank predicted, Ether could be worth $26,000 to $35,000 per token. The bank's analysis attributes this potential surge to Ethereum's strength in smart contracts, gaming, and tokenisation.

Finally, the Open Network Foundation (TON Foundation) is gearing up to demonstrate that its blockchain, The Open Network (TON), is the fastest in the world. A public network performance test is scheduled for October 31, 2023, where they will showcase the reliability, scalability, and speed of their blockchain. Viewers were encouraged to watch the event for informational purposes only and not make investment decisions based on the outcome.

Crypto Adoption And Initiatives Across The Globe

Zimbabwe has taken a bold step by introducing its gold-backed digital token, Zimbabwe Gold (ZiG), as an official payment method, encouraging local investors to shift away from the U.S. dollar and invest in national assets. 

In Nigeria, the Central Bank assures that its eNaira (CBDC), doesn't threaten the country's financial stability, amid concerns about liquidity in the banking system. However, it encouraged Nigerian citizens to consider the potential the CBDC can hold in improving the economy. 

Meanwhile, Japan is gearing up to launch the "DCJPY" digital currency in July 2024, offering a Financial Zone for digital deposits and a Business Zone for transactions and token issuance.

In the Philippines, Circle announced a partnership to promote the use of USDC for faster, cost-effective remittances. This comes at a time when Circle announced the expansion of its USDC presence. Circle is now minting USDC tokens natively on the Polygon scaling protocol, opening up opportunities for low-fee transactions in various use cases. 

Indonesia is also gearing up to conduct blockchain trials for public services, including blockchain-based digital certificates for land ownership and educational competencies.

Finally, the Bank of Korea and the Bank for International Settlements (BIS) are preparing to pilot a Korean wholesale central bank digital currency (CBDC), facilitating interbank transactions and fractional backing for CBDC-backed digital currencies.

Mastercard Successfully Tests Wrapped CBDCs for NFT Purchases on Ethereum

Mastercard recently completed a successful trial involving the wrapping of central bank digital currencies (CBDCs) on various blockchains, a concept akin to wrapped Bitcoin and Ethereum. The experiment, conducted with the Reserve Bank of Australia (RBA) and the country's Digital Finance Cooperative Research Centre CBDC, allowed CBDC owners to purchase NFTs on Ethereum. 

This involved locking a pilot CBDC amount on the RBA's platform and creating equivalent wrapped pilot CBDC tokens on Ethereum. This innovative solution leverages Mastercard's Multi Token Network, introduced in June 2023, to integrate payment technology with blockchain, offering the potential to enhance security and unleash new possibilities for commerce.

Explosive Testimony Unveils FTX Collapse Details and Market Manipulation Allegations

During the sixth day of Sam "SBF" Bankman-Fried's trial, significant revelations came to light through the testimony of the prosecution's key witness, Alameda Research CEO Caroline Ellison. Ellison admitted to committing fraud alongside Bankman-Fried and others, stating that he directed her to commit these crimes. 

She revealed that Alameda Research had taken several billion dollars from FTX customers and used it for investments. Ellison estimated that Alameda had received between $10 billion and $20 billion of FTX money, which they used for banking access at Silvergate.

The trial delved into financial documentation and the intertwined finances of sister companies, shedding light on an $800 million trading loss FTX suffered in 2021 due to a margin system glitch. When Ellison confronted SBF about the issue, he insisted that Alameda absorb the loss to keep it off FTX's records. Communication between Ellison and SBF from days before FTX's bankruptcy declaration revealed escalating panic and tensions surrounding the exchange's impending collapse.

Ellison also confessed to fooling Alameda's creditors by sharing balance sheets that made the company appear less risky than it was. This exposed several crypto lending firms and trading desks, including LEDN and Genesis, to Alameda's perilous financial situation. The testimony unveiled SBF's ambitions, including plans to acquire BlockFi and secure funds from Snapchat and Saudi Crown Prince Mohammed Bin Salman to manage Alameda's debt.

Furthermore, Caroline Ellison placed part of the blame for FTX's collapse on a tweet by Binance CEO Changpeng "CZ" Zhao, which led to the failure of the exchange. In 2021, the Chinese government froze $1 billion of Alameda's funds held on crypto exchanges OKX and Huobi as part of a money laundering investigation. SBF attempted unconventional means to retrieve these funds, including creating accounts under the identities of Thai sex workers and transferring significant sums to crypto addresses connected to Chinese officials.

A secret recording obtained by Cointelegraph provided insights into Alameda's use of FTX customer deposits, highlighting the tension leading up to FTX's collapse. Additionally, new testimony suggested potential market manipulation, with Bankman-Fried allegedly instructing Ellison to sell BTC if its spot price breached $20,000 using FTX customer funds.

These revelations offer a comprehensive view of the complex web of financial and personal dynamics surrounding the FTX collapse and its aftermath. While the trial continues, SBF maintains his not-guilty plea to the seven counts of fraud against him.