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FTX: Cryptocurrency giant Binance walks away from bailout

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Binance, the world’s largest cryptocurrency exchange, has backed out of a bailout agreement with its smaller rival FTX.

Binance stated that it would not pursue the purchase after conducting due diligence.

It stated that reports of “mismanaged customer monies and alleged US government probes” influenced its decision.

FTX has been dealing with a surge in withdrawals that had resulted in a “liquidity bottleneck.”

Concerns about FTX’s financial condition allegedly prompted $6 billion (£5.2 billion) in withdrawals in just three days.

According to Reuters, the US Securities and Exchange Commission (SEC) is looking into FTX’s management of customer cash and crypto-lending activities.

The markets regulator was investigating whether the platform had observed securities regulations regarding the separation of customer assets and whether it had traded against customers.

Binance said in a statement posted on Twitter that the issues facing FTX were “beyond our control or ability to help”.

“Every time a major player in an industry fails, retail consumers will suffer. We have seen over the last several years that the crypto ecosystem is becoming more resilient and we believe in time that outliers that misuse user funds will be weeded out by the free market.”

“As legal frameworks are built and the business continues to advance toward greater decentralisation, the ecosystem will get stronger,” the exchange concluded.

Sam Bankman-Fried, the creator of FTX, and Changpeng “CZ” Zhao, the CEO of Binance, are two of the most prominent personalities in the cryptocurrency sector, as well as high-profile rivals.

According to a note on its website: “Withdrawals are now being processed by FTX. We strongly advise against making a deposit.”

Mr Zhao, who tweeted on Sunday that Binance would sell its holdings of FTX’s digital token, known as FTT, added to the pressure on FTX. The token then lost over 80% of its value during the first day of the week.

Binance intervened on Tuesday, announcing that it has signed a letter of intent to purchase FTX’s non-US entity.

However, it emphasized that it had “the discretion to withdraw from the arrangement at any time.”

On Wednesday, Mr Zhao tweeted: “It’s a sad day. I attempted, but [crying emoji] “.

After Binance pulled out of the transaction, bitcoin fell more than 15%, while cryptocurrency exchange Coinbase fell more than 9.5%.

A rising number of bitcoin businesses have failed due to a lack of cash reserves.

Adding to the strain, the SEC and other regulators have increased their investigation of the business as concerns about how cryptocurrency platforms are trading rise.

Earlier this year, a subsidiary of crypto firm BlockFi agreed to pay a record penalty to settle charges related to its retail lending product.

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Biden Moves to Halt US Exports to Huawei, Reports Say

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Huawei Sales Up, But Growth Slows Under Virus, U.S. Pressure

According to reports, the US government has stopped allowing licenses for American corporations to sell most things to Chinese technology giant Huawei.

It comes as the Biden administration continues to tighten restrictions on US technology exports to China.

Huawei has already been accused by Washington of posing a threat to US national security and of collaborating with the Chinese Communist Party.

Both the firm and the Chinese government have refuted the charges on several occasions.

According to the Financial Times, which broke the story first, the US Commerce Department informed certain American corporations that it would no longer give licenses for US technology exports to Huawei.

According to the report, the action comes as Washington works toward a comprehensive prohibition on the sale of US technology to the Chinese telecom equipment behemoth.

“We routinely examine our rules and regulations and communicate regularly with external stakeholders, working closely with our interagency export controls colleagues at the Departments of Energy, Defense, and State,” a US Commerce Department official told the BBC.

“We do not comment on conversations with or deliberations about specific companies,” they added.

Huawei did not respond to the reports.

As political tensions between Washington and Beijing over Taiwan, where the majority of the world’s computer chips are manufactured, the Biden Administration has continued to tighten restrictions on Huawei.

Alan Estevez, the US Under Secretary of Commerce for Industry and Security, stated in October that “the danger landscape is continually evolving.”

“We are appropriately doing all in our ability to preserve our national security and prevent critical military technology from being obtained by the People’s Republic of China’s military, intelligence, and security agencies,” he said.

Huawei, located in Shenzhen, has battled US export restrictions on high-speed fifth generation (5G) telecommunications equipment and artificial intelligence technologies for several years.

During Donald Trump’s administration, US officials added the corporation to a so-called “entity list” in 2019.

It implies that US corporations must get a government license before exporting or transferring certain technology, especially if they are concerned that they may be utilized by the Chinese military.

However, during that period, certain US businesses, like Intel and Qualcomm, were granted licenses to provide Huawei with technology unrelated to 5G.

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Netflix Sets Date To Stop Passwords Sharing

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Netflix Sets Date To Stop Passwords Sharing

Netflix has announced its plans to start cracking down on subscribers who share their passwords by the end of March 2023.

Back in October, the streaming giant said it would begin charging subscribers who share their accounts but did not give a specific date or information for when the new policy would be enacted.

Netflix shared during their shareholders’ meetings last week that they recognise this is a drastic change for members who share their subscriptions with others.

There are also plans to make password sharing a bit complicated for users and might include an additional fee.

It said on its website that the company uses “a person’s geographic location, IP addresses, device IDs, and account activity from devices signed into the Netflix account” to determine which devices are in the same household.

The company told investors last week that it would roll out more stringent sharing rules by the end of March. More than a hundred million households currently share Netflix passwords, the service said.

The company said that “undermines our long-term ability to invest in and improve Netflix.”

It added, “As we roll out paid sharing, members in many countries will also have the option to pay extra if they want to share Netflix with people they do not live with. As is the case today, all members will be able to watch while travelling, whether on a TV or mobile device,’’ the company said.”

However, Netflix assured shareholders that, despite the recent changes, engagement will grow “over time as we continue to deliver a great slate of programming and borrowers sign-up for their own accounts.”

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Nigeria’s New Debit Card Will Impact Payments – Omoniyi Kolade

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