Crypto Flipsider News – Bitcoin Crash, USDD Depegged, BlockFi Lays Off Staff, Investors Sue Binance, Cardano Launches EVM

06/14/2022

4 minutes read

2022.06.14 18:46

Read in the Digest:

Bitcoin Crashes to 18-Month Low, Liquidating $1.25 billion; Binance Pauses Withdrawals

USDD Suffers De-Pegging Fears, Terra Declines, Says Celsius Withdrawal Restriction Doesn’t Affect USDT

BlockFi Lays Off 20% of Its Staff Amidst Cryptocurrency Market Downturn

Investors File Lawsuit Against Binance for Advertising Terra UST as ‘Safe’

Cardano Launches New Permissionless EVM Sidechain on Testnet

Bitcoin Crashes to 18-Month Low, Liquidating $1.25 Billion; Binance Pauses Withdrawals

Bitcoin was hit with its third hardest sell-off of the decade after the U.S. announced that the inflation rate had risen to a four-decade high of 8.6%. Since the announcement was made last Friday, the price of Bitcoin has fallen by more than 30%.

The 7D price chart of Bitcoin (BTC). Source: CoinMarkketCap

On Monday, June 13, the price of Bitcoin fell by as much as 15% to hit a low of $20,950, its lowest value since December 2020. Marginal gains over the last 24 hours have pushed the price of Bitcoin back up to $22,300.

The 1D price chart of Bitcoin (BTC). Source: CoinMarketCap

Over the last 24 hours, $1.24 billion in positions have been liquidated due to the sharp downswing. Bitcoin contributed over $600 million to the liquidation. An XBTUSD perpetual contract on BitMex of $4.4 million was the largest single liquidation in that period.

At the peak of the sell-off, Binance announced that it had temporarily suspended withdrawals on the Bitcoin (BTC) network on June 13 at 11:43:43 (UTC). The news caused the price of Bitcoin to fall even harder.

Flipsider:

Binance has now resumed withdrawals of BTC on the Bitcoin network after processing all pending transactions.

USDD Suffers De-Pegging Fears, Terra Declines, Says Celsius Withdrawal Restriction Doesn’t Affect USDT

With the crypto industry still recovering from the infamous implosion of the algorithmic TerraUSD (UST) stablecoin, investors were hit with another major scare as Tron’s decentralized USD (USDD) stablecoin was briefly de-pegged.

On Monday, June 13, Tron’s USDD price dipped to $0.97, mirroring the days before UST’s collapse. Data tracker showed that the brief de-pegging of UDDD was the result of attacks from hedge funds.

The 24-hour price chart of Decentralized USD (USDD). Source: CoinMarketCap

Nansen reported that one of the funds that capitalized on the UST depeg started actively transferring large amounts of USDD (between $200,000 and $12,000,000) and other stablecoins. Tron DAO reacted quickly, injecting 700 million USDC to restore the USDD pegged to the dollar.

The world’s biggest stablecoin, Tether’s USDT, has again lost its dollar peg owing to the freeze of all withdrawals on Celsius’s lending platform. USDT now trades at $0.9989 after dropping as low as $0.9975.

The 7D price chart of Tether (USDT). Source: CoinMarketCap

Flipsider:

Amidst the panic, Tether has issued a statement, clarifying that Celsius has “always been overcollateralized” and the withdrawal pause “has no impact” on the reserves of USDT.

Why You Should Care

The ongoing inflation scare puts crypto in a fragile position, and the de-pegging of any major stablecoin could be catastrophic for the nascent industry.

BlockFi Lays Off 20% of Its Staff Amidst Cryptocurrency Market Downturn

The Zac Prince-led BlockFi has become the latest prominent name to cut down its staff size due to the continuous fall in the value of the cryptocurrency market.

BlockFi, a crypto lending platform, announced Monday that it would reduce its workforce by about 20%, while digital currency exchange, Crypto.com, reported a 5% reduction on Friday.

BlockFi explained that the “dramatic shift in macroeconomic conditions worldwide” has negatively affected the firm’s growth. As a result, Block will be laying off approximately 850 employees or 20% of its workforce.

Flipsider:

Zac Prince, CEO of BlockFi, announced via a tweet on Monday that the company is dedicated to sticking around for the long haul.

Why You Should Care

The prolonged downturn in cryptocurrency prices has affected the profit of crypto firms, leading to the increasing layoffs of staff.

Investors File Lawsuit Against Binance for Advertising Terra UST as ‘Safe’

The ripple of the Terra ecosystem collapse continues to cause turbulence in the crypto industry, with investors in California now filing a class-action lawsuit against Binance US for false advertising of TerraUSD (USD).

The case was filed by the law firm Roche Freedman LLP and accused Binance US of misleading investors and selling unregistered securities to roughly 2,000 plaintiffs. The filing claims that Binance sold the “algorithmic stablecoin” TerraUSD (UST) as “safe.”

The lawsuit points to the adverts Binance ran on its platform, marketing the UST stablecoin as safe. The latest of these adverts was run in April, but the UST lost its dollar peg in May, ultimately leading to the collapse of the Terra ecosystem.

In addition, Binance US is being accused of not being committed to its customers by not complying with U.S. federal and state securities laws when it listed the now-defunct TerraUSD (UST).

Flipsider:

Although the lawsuit names LUNA and UST, neither Binance nor the cryptos are registered with the U.S. SEC.

Why You Should Care

The lawsuit adds more pressure on Binance, which is already being probed by the SEC over the 2017 launch of its native token, Binance Coin.

Cardano Launches New Permissionless EVM Sidechain on Testnet

IOG, formerly called Input Output Hong Kong, the software company behind the Cardano ecosystem, has announced the launch of its permissionless Ethereum Virtual Machine (EVM) sidechain alpha on the testnet.

The permissionless sidechain will enable developers to write solidity-based applications on the Cardano network and create EVM-compatible DApps and ERC20-compatible tokens while enjoying many of Cardano’s benefits.

The EVM sidechain will be fully compatible with Ethereum upgrades, tools, and wallets while inheriting security from Cardano’s mainnet. IOG did not specify if the EVM compatibility would be directly deployed to its mainnet one day.

The Senior Content Editor of Input-Output Global (IOG), Eric Czuleger, said the community believes in “an interoperable future” that will permit several blockchains to communicate.

Flipsider: