Crypto SWOT: Advisers overseeing the bankruptcy of FTX are struggling to locate the company's cash and crypto

Strengths

Of the cryptocurrencies tracked by CoinMarketCap, the best performer for the week was Trust Wallet Token, rising 93.04%.

The World Cup has an official crypto exchange sponsor - Crypto.com – and it's just one of several decentralized tie-ins for the World Cup, which kicks off in Qatar in the coming week. In September, FIFA launched its own NFT platform on the Algorand blockchain platform, and it's coming to the World Cup too, writes Bloomberg.

There can be little doubt that crypto investors expect more firms to blow up in the treacherous wreckage of the wipeout at FTX. Their puzzling response, however, has been to drive up Bitcoin this week. The token is up 3% over the period, topping global stocks while a gauge of the leading 100 virtual coins added about 1%, writes Bloomberg.

Weaknesses

Of the cryptocurrencies tracked by CoinMarketCap, the worst performing for the week was Casper, down 20.04%.

Bitcoin dropped after the crypto brokerage Genesis and its partner in a lending business, Gemini Trust Co, were the latest industry firms to detail the fallout from the spreading contagion after the collapse of the FTX exchange. The token dropped as much as 3.1%, erasing a small gain from earlier in the session Wednesday, writes Bloomberg.

Coinbase CEO Brian Armstrong sold more than 30,000 Class A Coinbase shares for $1.6 million on November 11, according to a filing with the SEC. Coinbase shares were trading over $340 when the company first went public in April 2021. They closed today at $55.53 as crypto prices have shed their value over the past year, writes Bloomberg.

Opportunities

Ark Investment Management snapped up more than 315,000 shares, worth roughly $2.8 million, of the beleaguered crypto fund on Monday for the ARK Next Generation Internet ETF (ARKW). Bloomberg data shows the firm's first purchase of the Grayscale product since July 2021, according to website Ark Invest Daily trades, which tracks the firm's portfolio moves.

Man Group is close to starting a dedicated cryptocurrency hedge fund, delving deeper into a market that's reading from the collapse of exchange operator FTX. The world's largest publicly traded hedge fund firm has been developing the strategy, led by money manager Andre Rzym, for months, writes Bloomberg.

A CFTC commissioner has urged crypto industry whistleblowers to come forward in the aftermath of FTX Group's implosion, saying tipsters have previously received millions of dollars for their help. CFTC said on Thursday that informants would get anonymity, adding that such tips play a crucial role in enforcement given the opaqueness of some of the crypto world, writes Bloomberg.

Threats

Temasek International invested $200 million to $300 million in FTX before its implosion and is preparing to write down the entire bet. Michael Novogratz, the billionaire founder of Galaxy Digital Holdings, said the crypto crisis could get worse as the industry braces for more contagion from the fall of Sam Bankman-Fried's FTX empire, writes Bloomberg.

Crypto brokerage Genesis is suspending redemption at its lending business after facing what it describes as "abnormal withdrawal request" in the aftermath of the collapse of FTX. Genesis' lenders include Gemini Trust Co., the cryptocurrency platform run by the Winklevoss brothers. Gemini said it has paused withdrawals on its lending program, writes Bloomberg.

Advisers overseeing the bankruptcy of FTX Group are struggling to locate the company's cash and crypto, citing poor internal controls and record keeping. The complete failure of corporate controls at the company is "unprecedented" according to new CEO John J. Ray III, who has a more than 40-year career in restructuring, including overseeing the liquidation of Enron, writes Bloomberg.

Frank E. Holmes

Frank Holmes is CEO and chief investment officer of U.S. Global Investors, Inc., a boutique investment advisory firm based in San Antonio that manages domestic and offshore funds specializing in the natural resources and emerging markets sectors. The company’s no-load mutual funds include the Global Resources Fund (ticker PSPFX), the World Precious Minerals Fund (UNWPX) and the Gold Shares Fund (USERX).

Please consider carefully the fund’s investment objectives, risks, charges and expenses. For this and other important information, obtain a fund prospectus by visiting www.usfunds.com or by calling 1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing. Distributed by U.S. Global Brokerage, Inc.

All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. Foreign and emerging market investing involves special risks such as currency fluctuation and less public disclosure, as well as economic and political risk.

The S&P/TSX Global Gold Index is an international benchmark tracking the world's leading gold companies with the intent to provide an investable representative index of publicly-traded international gold companies. The FTSE Gold Mines Index Series encompasses all gold mining companies that have a sustainable and attributable gold production of at least 300,000 ounces a year, and that derive 75% or more of their revenue from mined gold.

Holdings as a percentage of net assets as of 6/30/07: Jiangxi Copper (China Region Opportunity Fund 1.74%); Silvercorp Metals Inc. (World Precious Minerals Fund 2.78%, Global Resources Fund 0.89%, China Region Opportunity Fund 2.42%); Gold Fields Ltd. (Gold Shares Fund 6.05%, World Precious Minerals Fund 2.58%, Global Resources Fund 0.39%); Sino Gold Mining Ltd. (Gold Shares Fund 1.03%, World Precious Minerals Fund 0.58%, China Region Opportunity Fund 0.27%); Anglogold Ashanti (0.0%); Dynasty Gold (0.0%).

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Frank Holmes

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Crypto SWOT: Advisers overseeing the bankruptcy of FTX are struggling to locate the company's cash and crypto

By Frank E. Holmes

Kitco Commentaries
Opinions, Ideas and Markets Talk

Frank E. Holmes

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opinion

Crypto SWOT: Advisers overseeing the bankruptcy of FTX are struggling to locate the company's cash and crypto

By Frank E. Holmes

Kitco CommentariesOpinions, Ideas and Markets Talk

Frank E. Holmes

Tags:

Kitco Commentaries
Opinions, Ideas and Markets Talk