Unchained - Is Asia Going to Lead the Next Bull Run? - Ep. 460

Episode Date: February 24, 2023

Emily Parker, CoinDesk’s executive director of global content, joins the show to discuss the Asian crypto markets. From Hong Kong to Tokyo, Parker sees bullish signs in recent developments. Hear why she thinks China and Japan are closely watching as the U.S. clamps down on the crypto industry.  Show highlights: how Hong Kong is trying to create a regulated environment for crypto whether Beijing and Chinese officials support Hong Kong’s initiative  what was China’s motivation to make it harder to buy and hold crypto whether Asian countries will lead the next bull run  what the crypto environment looks like in Japan and how it differs from the U.S. how Japan responded to major crypto hacks and meltdowns what Japan is doing in terms of stablecoin regulation and adoption how Japanese authorities are trying to establish guidelines for DAOs whether people in Asia have different attitudes and views toward crypto and investing in general Thank you to our sponsors! Crypto.com Railgun DAO  Guest Emily Parker, executive director of global content at CoinDesk. Twitter Previous appearance on Unchained: Crypto in China: What It Really Looks Like Links CoinDesk:  Japan Embraces Web3 As Global Regulators Grow Wary of Crypto FTX Japan Customers Can Begin Withdrawing Fiat, Crypto on Feb. 21 WSJ: Some FTX Customers Can Withdraw Their Money—in Japan, at Least Bloomberg:  Hong Kong’s Crypto Hub Ambitions Win Quiet Backing From Beijing - Bloomberg Hong Kong Plans to Let Retail Sector Trade Larger Crypto Tokens Like Bitcoin Crypto Mogul Sun Says Huobi Betting China Will Warm to Digital Assets as Exchange Targets Hong Kong Hong Kong to Establish Task Force to Help Develop Crypto Hub US Crypto Crackdown Boosts Appeal of Dubai, Hong Kong, Europe Learn more about your ad choices. Visit megaphone.fm/adchoices

Japan is just an example of a country where, you know, for a while, regulation looked too strict and it looked really unfriendly, but now they're sort of reaping the benefits of their approach. Hi, everyone. Welcome to Unchained. You're a no-hype resource for all things crypto. I'm your host, Laura Shin, author of The Cryptopians. I started covering crypto seven years ago, and as a senior editor at Forbes was the first mainstream media reporter to cover cryptocurrency full-time. This is the February 24th. 2023 episode of Unchained. Branching out from just being a podcast, Unchained, has launched a new website, complete with more breaking crypto news, educational articles for those just getting started, how-to you guides, and videos. Check it out at Unchained Crypto.com to find answers to all your crypto questions. Ever wanted to use Defi without being tracked? Railgun is a leading defy privacy solution on Ethereum, BSC, Arbitrum, and Polygon.

Shield your funds and use them privately in your favorite defy apps, while Railgun's cutting-edge zero-knowledge system encrypts your data from public view. Yes, that includes dextrating. Visit railgun.org or use the Railway app at Railway.xy. With the Crypto.com app, you can buy, earn, and spend crypto in one place. Download and get $25 with the code, Laura. Link in the description. Today's guest is Emily Parker, Executive Director of Global Content at Cointecher.

desk. Welcome, Emily. Thank you. It's great to be here. This week, Hong Kong outlined a plan to allow retail trading of crypto assets like Bitcoin and Ether. Tell us what that new regime could look like and how it'll work. Okay, so this is a really interesting development and it really is a signal of a lot of activity picking up in Asia. So basically, the big news here is that Hong Kong is essentially setting up a licensing regime for crypto service providers. So the idea is that if you want to operate a centralized exchange in Hong Kong, you're going to need a license. If you're there and you don't have a license, you're going to have to go. That's kind of the big news. Now, the retail trading thing, this is something that there's kind of a consultation process, like they're talking

about opening the doors to allowing retail trading, but I don't think there's an exact date for when that would happen. So, but the top headline here is that basically Hong Kong is talking about really creating a very regulated environment for crypto. And I think a lot of people are seeing that as very bullish for Asia, for China, and just for crypto in general, because Hong Kong has been giving mixed signals over the years. Yeah, something that was interesting is Bloomberg reported that this opening toward crypto seemed to be sanctioned by the Chinese government, which famously has banned things like crypto trading in recent years. So what evidence did they provide for that? And why do you think that that news would be significant?

So, you know, these things are always a little bit signaling, right? And so there's a lot. not really hard evidence that, you know, China is supportive of this, although one would imagine that if Hong Kong is doing something, Beijing at least is aware and probably at least tacitly supports it. But basically what Bloomberg is pointing to is that they're saying that representatives from China's liaison office, which is kind of like the mainland representative in Hong Kong, has kind of been showing up at Hong Kong crypto gatherings, you know, over the past few months. And this can seem like, okay, really, this is a signal of mainland support. but when it comes to China, you do have to sort of read signals like that.

And so, yeah, I think the idea that you have these sort of mainland representatives literally showing up at crypto events is some sign of, I don't know, at least willingness to engage. No, there's been other signals with China. But again, they're all very, you have to interpret them. But, you know, for example, there was a statement from a former central bank official who said something along the lines of, you know, China might need to adjust its regulations on crypto to ensure that it doesn't miss out. You know, again, former, former central bank, but still, you know, this was published.

This was out there. So I think there's been some little signals. And the reason why this is important is because, as you know, China cracked down on crypto very, very hard. I mean, first started cracking down seriously in 2017. And then the crackdown kind of accelerated over the past couple years. And I think there were some people who thought China was basically out of the game. And I never really believe that.

I never believe China was out of the game. But I think this is more evidence that China is going to come back. in some form into the global cryptocurrency world. And wait, so first of all, why did you not believe that China was out of the game? And then what could that look like if China gets back in? Well, I didn't believe that China was out of the game because it literally was not out of the game, right? So, you know, I've spent a lot of time in China and in that market.

And, you know, so China cracked down on very specific things in 2017. It cracked down on, you know, exchanges. It cracked down on ICOs. But trading did not completely end in China. If you wanted to have access to crypto in China, you found a way to do it. And that's been going on all along. And even when the crackdown accelerated and they started cracking down on over-the-counter, OTC, there were still, like, if there was a will, there was a way.

You know, if you wanted to trade crypto in China, you found a way. And I knew people who were doing it. I heard about people who were doing it. It was clear that it just wasn't completely dead. And I think the important thing to understand here is, like, what was China's motivation? And I think a lot of people get this wrong. I don't think China ever intended to just, like, stamp out crypto entirely. I don't think that was ever their goal.

What they were worried about is kind of the masses using crypto. You know, when China had this ICU boom and there were scams proliferating, and I think what the government was worried about is that you would have all these sort of like new, unsophisticated investors, betting all their life savings on some weird ICO and losing everything and then going to protest or going to complain to the government. And I think, you know, China, the thing that they emphasize almost more than anything is this concept of like social stability, right? like keeping things stable. So they wanted to avoid that. They wanted to avoid a massive crypto meltdown.

That's not the same thing as saying absolutely nobody can hold crypto. Do you know what I mean? So I think like what they did establish that, you know, it made it a much harder to trade crypto. It raised the threshold for crypto investment, but it didn't stamp it out entirely, you know? And I think Hong Kong in a way, that's kind of what this is, right? I think that's what this is. I think this is a way for, you know, basically moving kind of the crypto center to Hong Kong. You know, China's still a part of it. China's still in the background, but it's not something that's going to like destabilize the mainland, if that makes sense.

So I feel like China is an important player in this to some extent. Okay. Yeah. I think I read some commentary saying that it was sort of like the Chinese government knew that if there were Chinese nationals that did want some access, then Hong Kong could be that place, but it would be sort of like a limited playground for it. And maybe perhaps it's testing the waters for them to open the doors to more of that in China itself. Yeah, I mean, think about it. So, you know, there's all sorts of ways for mainland crypto investors or entrepreneurs to get involved

if Hong Kong really becomes a crypto hub as some people are predicting that it will, right? I mean, one way is to open up a Hong Kong bank account. You know, another way is to just kind of move to Hong Kong or move to Shenzhen or move somewhere nearby, set up shop. there. I think, you know, with China's crackdown, there's been a big exodus from China to Singapore. That's been a big narrative in Asia over the past few years. A lot of these like Chinese crypto projects went to Singapore, but now sort of, you know, I'm sorry to hear complaints that Singapore's too expensive or, you know, they want something else. So I think we could just start seeing some Chinese talent and some Chinese projects and some Chinese investors actually moving to

Hong Kong or moving closer to Hong Kong. Yeah. And after Singapore's experience with Tara Luna and 3AC. Who knows, maybe the regulatory wins are shifting basically from one place to another. So something else that I'm sure you saw on crypto Twitter is that a number of people in the crypto community seemed to think that these developments meant that Asia would kick off the next crypto bull run. What did you think of that idea? Yeah, I mean, you definitely don't need to convince me of that. Like, I think that's really possible. And Laura, you know, I've been listening to your podcast and listening to Unchained and listening to the guests you have talking about the situation in the U.S. And these two things are not unrelated, right? Because look at the signals

that the U.S. is sending and look at the signals that Hong Kong is sending or look at the signals that Japan is sending. We can talk about Japan in a minute. But, you know, we have the U.S. basically doing this sort of regulation by enforcement, you know, the SEC cracking down on various players. Even if you agree with what the SEC is doing, I think most people in the crypto industry do not agree with the process, right? They think that this is incredibly confused. They think that it's going to scare crypto projects from out of the U.S. You know, the U.S., I think if you just take a step back and look at the message that the U.S. is sending a message that crypto is something to protect people from, first and foremost, right?

And so then you look at Hong Kong, and don't get me wrong. I don't think it's going to be easy to set up a crypto business in Hong Kong, not at all. Like, I think they're going to be very strict, but you also kind of get the feeling that they're, they also see it as an opportunity, right? They see this is like they're kind of welcoming it. Like they see this as an opportunity, whereas I don't get that sense from the U.S. at all right now, you know? So just in terms of the signaling, you know, they're very, very different.

And I'm sure you've heard this. I mean, I've heard this anecdotally. I've heard this from lawyers. I mean, I think I've heard people on your show say this, that people, you know, crypto projects are now threatening to leave the U.S. because it's always been a jurisdiction whack-a-mole. And, you know, if one jurisdiction isn't friendly, people will just go to another one. Yeah.

So one other thing I was curious about was how you thought this might intersect with some of the macro movements. The Chinese central bank is apparently doing quantitative easing and it's, I think, done its largest liquidity injection ever recently. And I wonder how you thought that might intersect with what some of these crypto moves are. Yeah, it's really hard to tell. I mean, all I can say on the Chinese economic front is that, you know, China is opening up, right? I mean, you know, a big part of this story also has been how, and this is relevant to Hong Kong as well, you know, like Hong Kong was completely. closed off because of COVID. China was completely closed off because of COVID. This had a major

economic effect on, you know, on that whole region. And so that is one economic story that I think plays a role in all of this. But yeah, I think we're just going to have to see how it plays out. All right. So in a moment, we are going to talk about other parts of Asia, especially Japan, but first, a quick word from the sponsors who make this show possible. Ever wanted to use defy without being tracked? Realgun is the leading defy privacy solution on Ethereum. It's available on B and C, Arbitrum, and Polygon 2. Shield your funds and use them privately in your favorite Defi apps,

while Railgun's cutting-edge zero-knowledge system encrypts your data from public view, all without leaving your preferred chain. Yes, that includes Dex trading. Coming soon are integrations with leading yield, lending, and perp trading platforms on multiple chains. Defy and privacy, together at last. Visitrail.org or use the Railway app at Railway.xy to find out more. Back to my conversation with Emily. So now let's talk about Japan, which has been

the center of a huge crypto story for a long time, which is obviously Mount Gawks. But when you visited recently, you noticed several different trends. And why don't we maybe start with kind of the fallout from Mount Gox and then maybe talk a little bit about how that has affected what happened with FTX Japan. Yeah, I really feel like the world or the crypto industry is really sleeping on this Japan. story, you know, because it's really funny. You just hear a lot of people saying like, oh, you know, the next hotspots of crypto and they mention, you know, Hong Kong or they might mention Dubai or they might even mention Europe. And nobody really is mentioning Japan. And I think Japan, what is happening in Japan is really, really important. So yes, I was recently in

Japan. And I have to say, again, just unlike the way people were talking about crypto there, was very different from how they're talking about it in Washington. I mean, there actually is, which I think you could appreciate the rarity of this in this moment of time. There's actually still like enthusiasm about crypto in Japan, right? And I think like, and I'm talking more at sort of like the politician level, regulation level, you know, like, and I'm talking about in the context of post-FTX, you know, I didn't get the sense that people in Japan were particularly freaked out by that, that they were worried about it. It was just kind of like they were actually positioning themselves to embrace Web3 further. So I thought that was super interesting. Now, you mentioned Mount Cox,

yes, this history is really relevant. It's really important to understanding where Japan is now. So, you know, Japan was home to Mount Gox, basically this, you know, exchange that kind of like one of the first, you know, really well-known sort of crypto exchange disasters, I would say, you know. And then, but that was only the first part of it because the second part of it was Coincheck, which was another Japanese exchange that was hacked, I believe, in early 2018. And at that time, it was the largest hack in crypto history. So Japan got hit twice and they got hit really hard. And what's interesting about it is like, if you went to. to Japan after the coin check hack, the impression you would get is like it was over, you know, because I think regulators were really freaked out by that and like activity kind of really slow down.

It was really hard to list tokens. It was really hard to do anything. But really what they were doing is they were sort of like figuring out a path forward. So in, in reaction to those two kind of crypto exchange disasters, they put in these sort of regulatory measure. So one of them, for example, is like making sure that exchanges hold like the vast majority of crypto. on cold wallets, right, not hot wallets. I'm not, you know, to protect against hacking. But the other one, which is really relevant to the FTX situation, is basically requiring at a regulatory level that exchanges segregate assets, right? So like you can't intermingle customer assets and exchange assets. They're separated. And this is really what sort of saved FTX Japan. So FTCS

Japan is like one of the only sort of FTX, I don't know, parts of the FTCS structure that actually is returning money to customers because they sort of had a lot of these safeguards in place. You know, so Japan is just an example of a country where, you know, for a while, regulation looked too strict and it looked really unfriendly, but now they're sort of reaping the benefits of their approach. Yeah. You know, when I was reading about that, something that struck me was that like this is sort of why you need regulation because you would imagine that any business owner would want to do that to ensure the viability of their business. but that's like assuming certain things about their mindset or whatever, but obviously there are

certain people who don't have that mindset. And so then you would need the regulation to make them do the thing anyway that they may not be inclined to do. So one other part of your article that was super interesting was Japan looks like it's ready to move forward with regulation on stable coins. So what did you see there? Yeah. So again, you know, Japan, at least what they were saying is like, okay, we're going to be, you know, some people were saying, we're going to be the first place to regulate permissionless stable coins. Again, if that's true, that's a pretty big story that I don't think a lot of people are paying attention to. But, you know, here's the thing. So here's the thing that a lot of people don't realize about the

Japanese market. Stable coins are basically not allowed there now. You know, they're not allowed on Japanese exchanges. They've been very, very conservative about stable coins. So basically what the stable coin regulations will do is, and I think they're supposed to take effect like some time in the middle of this year, they will pave the way for stable coins, including overseas stable coins, to come in. So there's two things that are interesting about this. One, it's like at a time when everybody is kind of freaked out about stable coins, you know, with like the Terraluna thing and people are worried about tether. Japan is saying, okay, we're actually sort of slowly open our door, opening our doors to stable coins, kind of counterintuitive. But the second thing that's

important to remember is they're coming from a very low base, right? They're coming from a place where stable coins essentially do not exist. So this is like a modest opening. And I do think that the stable coin regulations, especially for overseas stable coins, are going to be super, super, super strict, right? I mean, I think, like, they're going to require, like, you know, I think I saw something that said they're going to require reserves or, you know, actually kept in Japan. And I mean, it's not going to be easy. It's not going to be easy for an overseas stable coin to come into the Japanese market. But still, you know, it is a step towards opening further. And that will take effect like this summer or something, right? So there could be clarity quite soon on

that in Japan. Well, there already is clarity. Like those stable coin regulations are already sort of laid out. It's just, we're just sort of waiting for them to take effect. I think there was also movement on NFTs there. I don't know what you're seeing, what you saw while you were there. So basically on NFTs, what they did do is they've, at least there are guidelines for NFTs. I don't know if I would say there's actual movement, but there's very, very, very detailed guidelines like talking about, you know, sort of IP concerns and, you know, what is an NFTs? And I think the reason for this is because I think there are some Japanese politicians who want to get more big companies into the NFT game. You know, like Japan has a lot of amazing content and they have like a lot of kind of amazing companies.

And I think they want to get them more involved in NFTs. But there's this fear that if there isn't a clear legal regulatory framework around NFTs, then those companies are going to be reluctant to jump in. So I think that's what Japan has. But if you look at the NFT guidelines, I mean, they're very, very, very detailed. They're not like law or anything like that. They're just kind of detailed, you know, suggestions almost. But, you know, somebody took a lot of time to lay those out.

And interestingly, Japan is also moving forward on DAO's. Its digital ministry is creating a DAO and they're doing something similar to Wyoming, giving DAO's legal status. So can you talk a little bit about what it is they're doing and, you know, how you think this will move forward? Like, I feel DAOs are very nascent. And so maybe this is, I don't know, sort of, yeah, a national. nascent law, but I was interested in the movement I saw there. There's at least a handful of politicians in Japan that see DAOs is a big opportunity.

And I know, like, one of the things they're trying to do is basically get like LLC protection for a DAO. So like, you know, you have a DAO and you run into some sort of problem. Like you have that kind of like protective framework. That was one of the things that I heard talked about. But yeah, I mean, again, I think same thing. I think they see DAWS as this big opportunity and they want to get more big players involved in it. And the concern is that there those big players are not going to get involved if they think there's too much legal uncertainty around it, right? If they think they might like accidentally get sued or they might accidentally do something against the law. So I think they're trying to like establish some guidelines that will make it

easier for people to enter that space. And actually even just thinking about this, like it strikes me all of a sudden that DAWS maybe work quite well with Asian culture, which is sort of a collectivist or more collectivist, I think, than like a Western mindset. So that's interesting. Well, One last piece that I just wanted to ask you about was, you know, I've heard over the years from different people in crypto who've spent a lot of time in Asia that the Asian kind of culture around crypto, but also money in general or even investing, is quite different from the U.S. And I wondered if you still saw differences in that when it comes to attitudes towards crypto today. I think it just really depends.

It's so different country by country, right? So, I mean, if you even look at like Japan and if you look at Korea and you look at China, they all have like very sort of different crypto cultures, you know. So I don't know. I think it would be difficult to like kind of summarize. Or if you look at Singapore, they're sort of doing their own thing too. But, you know, I think like in all these markets, I mean, or in like Japan and Korea specifically, I mean, there's, you know, a very active retail market and has been for a while

and just like a lot of enthusiasm for the technology. Yeah. I mean, I think there's just a really big opportunity. here, you know, and I think, yeah, I mean, I think we're going to see more activity from Asia, especially, you know, if the U.S. isn't able to get its act together on the regulatory front. Yeah, yeah, Huobie, Justin's son, I should say, made an announcement that will be Hong Kong will be opening up or moving back there or something. And so then it got me wondering about what movement we'll see from other businesses.

So I think we'll have to keep our eyes on that. Yes, I think we're going to hear a lot more about this in the coming months. Yeah. All right. Well, thank you so much for explaining it all on Unchained. Thank you. Don't forget. Next up is the weekly news recap. Stick around for this week in crypto after this short break. Amazon presents Jamal versus the Shih Tzu.

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Get up to 5% cash back instantly. Plus, 100% rebates for your Netflix and Spotify. and zero annual fees. Download the crypto.com app now and get $25 with the code Laura. Link in the description. Thanks for tuning in to this week's news recap. Blur leaves OpenC in its wake. Upstart NFT marketplace Blur overtook category leader OpenC and transaction volume this week, ending OpenC's long-time dominance. Over 80% of NFT trading volume occurred on blur, dwarfing OpenC's 13%. Blur officially launched last fall, but its February 14th governance token Airdrop helped boost trading to frothy levels and put pressure on open sea. The project's pseudonymous founder, Pac-Man, also revealed his name, Tishun Rocare, after appearing on the chopping block this week.

He told the block, we focus on the NFT natives first, and from there we can expand, similar to how Binance expanded downmarket and broadened the offering. Blur, however, faces obstacles. chain data suggests that wash trading could have helped generate that high trading volume. A more recent analysis shows that 25% of Blur's total volume comes from 50 traders. Compare that to OpenC, where the top 250 NFT traders make up 11% of volume. For now, OpenC maintains a larger user base, even though it admits it's lost some customers since Blur came around. In October, we started to see meaningful volume and users move to NFT marketplaces that don't fully enforce creator earnings, tweeted OpenC last Friday, as it moved to an optional royalty model. Today, that shift has

accelerated dramatically despite our best efforts. OpenC is taking steps to regain dominance. In addition to restructuring royalties, it is temporarily eliminating its marketplace fee. Blur, meanwhile, is doubling down on its strategy. It's planning to distribute another 300 million Blurr tokens for Season 2. In related news, Bitcoin Ordinals continue to garner interest. On Wednesday, Bitcoin mining company Luxor, but Ordinal Hub, a Bitcoin NFT marketplace. Coinbase optimistically jumps into Layer 2 wars. Coinbase is looking for creative ways to generate interest in crypto and increase revenue.

The crypto exchange announced Thursday that it has launched a TestNet for its own Layer 2 network, base. Eventually, this blockchain, which is built using Optimization, which is built using Optimization, Open Source software and could be extended to include Solana, could serve as a hub for scores of decentralized applications. Check out Unchained video on the announcement for more information. There's plenty of demand for Ethereum scaling solutions and for roll-ups in particular. On Tuesday for the first time, a layer two has posted more transactions than Ethereum, with arbitram taking the mantle. Meanwhile, proof of stake side-chain polygon users got a scare on

Wednesday, when several trades temporarily fell out of sync, and the Polygon Scan Block Explorer stopped updating. In related news, Ethereum's Shanghai Capella upgrade will be rolled out on the Sepolia test network by the end of February, before launching on Mainnet and March. As for Coinbase, its foray into layer two's reflects a desire to create an on-ramp to the exchange. On Tuesday, it reported a $557 million net loss in the fourth quarter of 2022, despite beating analysts' revenue expectations. Though quarterly transaction revenue was down 12 percent, the exchange pointed to lower crypto prices as a culprit. On a positive note, subscription revenue and sticking revenue were both up. Topshot basketball NFTs may be securities judge rules. A federal judge on Wednesday denied Dapper Labs' motion

to dismiss a lawsuit alleging its NBA Topshot NFTs are unregistered securities. The class action could represent a significant hurdle for how digital collectibles are bought and sold. While Dapper argued that it's fundamentally selling digital versions of a basketball card, the judge wasn't so sure. Using the Howie test, a method for determining what constitutes an investment contract, district judge Victor Minero found that, quote, purchasers fortunes were tied to the overall success of Dapper Labs. If the company can't convince him otherwise, he may roll them to be securities. Dapper Labs has until March 15th to respond. Binance separates reserves from customer tokens. Last month, Binance admitted it had accidentally been storing some customer funds with the collateral backing

its B tokens. Finance on Wednesday said it had implemented a semi-automated process to prevent this from happening again. It theoretically allows finance employees to intervene in case the reserves are at risk. Binance, the top crypto exchange by trading volume, mints 97 different type of tokens. These B tokens are wrapped versions of, say, Bitcoin, meaning you can swap your BTC for BTCB and use it on Binance's bespoke blockchain. The company's previous system for backing BUSD, which is issued by its partner Paxos, failed. And at least once, more than $1 billion in collateral went missing. Last week, the Securities and Exchange Commission and the New York Department of Financial Services put pressure on Paxos to stop minting BUSD.

Taxos has severed its relationship with the crypto exchange. It now says it's having a constructive discussion with the SEC. If all that weren't enough, Binance U.S.D very briefly lost its peg compared to the Dye Stablecoin Wednesday. It dropped to 20 cents on the exchange before immediately going back to $1. Voyager's sale to Binance U.S. in the balance as creditors fight over FTX loan. This week, creditors of Voyager Digital seemed ready to back a plan to say, sell the bankrupt crypto lender to Binance U.S. When the Federal Trade Commission filed an objection with the bankruptcy court, the agency is investigating Voyager Digital about what it alleges were deceptive and unfair marketing

of cryptocurrency to the public. The SEC followed suit, alleging that some transactions required as part of the proposed Binance U.S. deal, particularly those involving Voyager's token, VGX, could violate securities law. Meanwhile, Voyager's creditors approved the plan, which could result in them recovering around half of their assets. But that's only if all goes according to plan. They have subpoenaed former FTX CEO Sam Bankman-Fried over FTX's attempts to get back a $446 million loan repayment from Voyager. No surprise that Voyager creditors would rather have it in their pockets. Lawyers for SPF called the subpoena procedurally deficient because it was to

delivered to his mother. SBF gets hit with more indictments. U.S. officials filed new charges against the former FTCX chief, including bank fraud and the unlawful operation of an unlicensed money transmitter. SBF was already facing nine charges, including wire fraud and conspiracy to commit securities fraud. The count is up to 12. In support of its bank fraud allegation, the government said that when opening a bank account, SBF, quote, falsely represented. to a financial institution that the account would be used for trading and market making. It alleges the account was instead used to receive and transmit customer funds. Bankman Fried also faces a modified charge on his political involvement.

Prosecutors alleged he and his conspirators made corporate and committee contributions in the name of others. Last Friday, Bloomberg reported that FTC's former director of engineering, Nishad Singh, is expected to plead guilty to fraud charges. more FTX fun in games. The FTX saga continues to take down investors. Galwa Capital, a cryptocurrency hedge fund, which had half its capital trapped on the exchange, unwound all of its positions this week. Galois's investors are said to do slightly better than their Voyager counterparts.

Galois says they will get back 90% of their funds that aren't on FTX. Crypto lending firms weren't the only ones left holding the bag after Terra and FTCX collapsed. According to the Bank of International Settlements, investors in emerging economies took the biggest losses. On a related note, funds that buy distressed assets are purchasing FTC bankruptcy claims for 15 to 20 cents per dollar in private OTC markets. According to an FTC creditor quoted by CoinDesk, buyers are likely eyeing a recovery of 50 cents on the dollar within the next five years. Speaking of CoinDesk, the crypto outlets Ian Allison and Tracy Wang won a prestigious polka Award for their work. The George Polk Award committee said Allison's and Wong's three winning stories quote brought young Sam Bankman-Fried and his supposed $32 billion cryptocurrency empire crashing

down in just 10 days. Congrats, CoinDesk. More crypto layoffs hit the sector. Following the lead of Coinbase, Consensus, and other crypto companies, Polygon Labs laid off around 100 employees on Tuesday or 20% of its workforce. Polygon representatives, maker of the popular Ethereum side chain, insist its treasury is healthy. They say it has $250 million and $1.9 billion of its native Matic tokens,

which trade for well over $1. Missouri, which aggregates and analyzes blockchain data, is cutting 15% of its workforce. CEO Ryan Selkis told CoinDesk on Thursday that while the company will continue hiring for some open roles, it needs to restructure. Australia-based gaming firm Immutable also announced layoffs of 11% of its workforce to improve its cash position.

According to Immutable, which earned unicorn status last year, it has $280 million on hand, equivalent to about four years of spending at current levels. And disclosure, Immutable is a former sponsor of Unchained. On a slightly different note, the information reports that eight employees have left venture capital firm paradigm within the last five months, including two of its six investment partners and four of its 13 engineers. The Cryptocentric VC firm had invested $270 million in FTCS. It subsequently wrote the value of that investment down to zero. One Coin's Crypto Queen may have been murdered. The FBI has been hunting Ruzha Ignatova, better known as the Crypto Queen, since 2017. It added her to its 10 most wanted list after she co-founded the One Coin Ponzi scheme,

and allegedly made off with $4 billion from victims. Ignatova has thus far alluded authorities and hasn't been seen in five years. New evidence suggests a potential reason. She might have been killed back in 2018. This evidence comes from documents recently acquired by the Bureau for Investigative Reporting and Data, a Bulgarian news outlet. BIRD claims that a Bulgarian drug kingpin put out a hit on Ignatova and that she was killed on a Uyghurian.

Greek yacht in November 2018. Prior reporting from the BBC suggested one coin might have been affiliated with Eastern European mobsters. Ignatova, who was born in Bulgaria, may have been found hiding out with the wrong people. Time for fun bits. This week, Tim Berners-Lee, creator of the World Wide Web, made some disparaging comments about crypto. Ginny from Unchained has some commentary about that. On a recent CNBC podcast episode, Worldwide web creator Tim Berners-Lee referred to crypto as dangerous and compared it to the dot-com bubble, which feels unfair to me because the dot-com bubble at least has the decency to be over. Listen, I believe in anyone's right to criticize anything, but is this not a little bit of a Frankenstein in his monster situation?

If he wants to take credit for all the people who got laid because of Tinder, he's also got to accept responsibility for whatever happened at NFT Miami. Tim Berners-Lee also wanted listeners to know that he is dissatisfied with the way that his original vision for the internet played out. We know. Have you been on the internet recently? It's all pop-up ads. No shit he didn't intend for that to happen. I don't mean to be too hard on Berners-Lee. He is doing his best to write the internet. For instance, he created a startup with the aim of giving people more control over their data. The only problem with his startup is that he named it inrupt, which I have to imagine is supposed to evoke images of disruption within oneself.

To be honest, I'm just thinking about that time that I ate four or five or one bars and one sitting. Thanks so much for joining us today. To learn more about Emily and the state of crypto in Hong Kong, China, and Japan. Check out the show notes for this episode. Unchained is produced by me, Laura Shin, with help from Anthony Yun, Mark Murdoch, Matt Pilchard, Zach Seward, Juan Aranovich, Sam Shri-Ram, Ginny Hogan, Ben Munster, Jeff Benson, Pamajimdar, Shashonk, and CLK transcription. Thanks for listening.