January 20, 2023

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In crypto news today Nexo settles with SEC, DCG's Genesis files for bankruptcy, Jamie Dimon spreads FUD about Bitcoin and Crypto at Davos. 🌟Sponsor - Signup with Uphold. https://uphold.sjv.io/gbED4X 🚀 Get the Ledger Nano X to Safely store your Crypto...


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All right, guys, we got big news to cover and a lot of news, but it's all important things that you need to know about. First up is Nexo and the SEC. So the SEC tweeted out the following, today we charge Nexo Capital Inc. with failing to register the offer and sale of its retail crypto asset lending platform, the Earn Interest product, also known as EIP. To settle charges, Nexo agreed to pay $22.5 million and cease its unregistered offer and sale of the IEP to the US investors. So as a US resident and citizen, I'm of course annoyed by this. I can't go earn off my cryptocurrencies, which really sucks, right? The SEC, of course, going after another company here without providing the clear guidelines. So regulation by enforcement, once again, which is not helpful at all. We've seen the SEC has been targeting these earned products, these interest bearing products, and they are not inherently bad, but they do need to be regulated. So don't get me wrong. The SEC should have been looking into Celsius, right?

We see what happened with them and their collapse. We saw the SEC to go after BlockFi and find them $100 million. And I think that helped put them out of business for sure, because they were having issues with the bear market and exposure to other funds, which were not doing well. But the TLDR here, the SEC needs to provide clear guidelines and they cannot blackball these crypto companies from doing this. This is going to be the future. And guess what? It's happening overseas, lending and borrowing and so forth. So you do that here in the United States where you block it off. Guess what people are going to do? Move their funds overseas and go participate with companies overseas. So this is the really bad situation that many of these crypto companies are in. So Nexo, of course, they tweeted out their details on it.

And let me read what they sent out here. Nexo has reached a final landmark resolution with the SEC, the North American Securities Administration's Association, and consisting of all 50 US states and three territories and the Attorney General of New York. They said here characteristics of the settlement with the US federal regulators, the settlements are on a non-admit, no-deny basis. The sole allegation was that Nexo's earned interest product was an unregistered securities offering. This closes all multi-year long inquiries into Nexo. So it's good that there's some sort of resolution here, because if you guys recall, Nexo had put out a statement, they were leaving the US ceasing operations here. But at the same time, even though they found some sort of resolution, it doesn't help users who want to earn from their crypto. And I've said it many times, you can imagine the big banks were lobbying Gary Gensler and people, the SEC, to put a halt to this because money would leave the banks. Right now, they're giving you next to nothing as far as interest rate, but still, they don't want you to take your money out, putting in crypto and go earn higher yield. It's taking money out of their pockets, but they're supposed to be competition, free market, not bribery here. And I think there's a bit of that happening, but hopefully the United States can get it right. You can have these products for crypto, but you regulate it.

Make sure they're not scammers. Make sure these folks are using the funds correctly. They're not over-leveraged. They're not co-mingling funds and doing all the nonsense fraud stuff that, for example, Sandbank Murfrid was doing. So attorney Jeremy Hogan weighed in on this with regards to the SEC and how they handle this. He said the SEC charges Nexo for its lending product and settles with them the same day, a $45 million collection. But isn't Nexo an exchange? What about the numerous securities that Nexo is unlawfully selling to US citizens? That's okay now, I'm confused. Typical BS coming from Gary Gensler and the SEC. Double standards everywhere. Gary's making this up as he goes.

And the reason why he doesn't want to put the clear regulations out is he can go to the well here of crypto and grab millions of dollars in fines, because that's how the SEC funds its business. So I think there's definitely a layer there. There's also him trying to protect the incumbents, which are these banks and institutional investors who they see the capital once again, leaving their accounts and going into crypto. So as usual, more confusion, more nonsense from the SEC and Congress needs to act. Now, Charles Gasparino, Fox Business, tweeted out the following. He said, the more I delve into Sandbank Murfrid's implosion and hear how he met with the SEC not only once, but twice, it's hard to not realize that the SEC really botched its regulatory agenda going after Ripple over unregistered XRP when serious issues of potential fraud always resided with exchanges. He's absolutely right here. Not only that, Gary was spending his time going after Kim Kardashian. It's like, really, Gary, why were you not looking to Terra Luna, Celsius, Voyager, three hours capital, Sandbank Murfrid and FTX. Sandbank Murfrid came into your office, Gary, and met with you. And you were trying to give him a free pass that he, you know, so the FTX would have a monopoly. And you clearly didn't do your job as the supposed cop on the beat.

You completely failed. So I think everybody sees it as a big time failure by Gary Gantzler and the SEC here. Now let's move ahead. We got big news that crypto firm Genesis files for chapter 11 bankruptcy and SDNY. Now, of course, Genesis is part of digital currency group, which owns grayscale and many other companies. And we kind of saw this coming, but it's kind of alarming that Genesis was not able to get anybody to build them out, right? Yes, they were in the hole for over a billion dollars. Yes, the folks at Gemini and the earn customers are waiting to access their funds, but it's kind of alarming that they were not able to get any type of bailout here. I think I find a very surprising and I think it's a red flag. It means there's probably more things going on. There's more layers to this. And hopefully, you know, there's not a collapse of grayscale or digital currency group and people get triggered when I say that, but I'm prepared for all scenarios.

I'm not saying I want that to happen, but I understand there is a probability it could happen because we don't know all the details. And I'm a big believer when you see smoke, there's fire, right? And I'm seeing smoke here. And the fact that they were not after, you know, months of trying to talk to different folks, even I tweeted at Barry Silver, I said, you need to call a black rock, right? And go get that bailout, man. But nobody came. Nobody came here and they're filing for bankruptcy. So let's see how this affects the markets and the price of Bitcoin. Hopefully there's not some major fallout. And Cameron Winklevoss, one of the Winklevoss twins tweeted out regarding this news. He said, earn update this evening, Genesis Global Capital LLC filed for bankruptcy under chapter 11th. This is a crucial step towards us being able to recover your assets.

While we have been working around the clock to negotiate an acceptable solution, Barry Silbert and DCG, the parent company of Genesis continue to refuse to offer creditors a fair deal. Cameron says here, the good news is that by seeking the protection of the bankruptcy court, Genesis will be subject to judicial oversight and will be required to provide discovery into the machinations that brought us to this point. He said, crucially, the decision to put Genesis into bankruptcy does not insulate Barry, DCG, and any other wrongdoers from accountability. We have been preparing to take direct legal action against Barry, DCG, and others who share responsibility for the fraud that has caused harm to 340,000 plus earned users and others duped by Genesis and its accomplices. He says here, unless Barry and DCG come to their senses and make a fair offer to creditors, we will be filing a lawsuit against Barry and DCG imminently. Wow. This, once again, guys could escalate further and it could have big impact on the markets. I hope not. I want Bitcoin to do its retracement, go to maybe 30, 40k, all coins to pop off and that's my ideal scenario, but we have to wait and see what happens, but you can't ignore this. You can't ignore the possibility that this could get worse and have a big impact on the market. Now, Mr. Jamie Diamond, the Bitcoin Fudster himself was at Davos. He was interviewed by the folks at CNBC and he continues his yearly scheduled FUD.

I've watched Jamie Diamond spread FUD about crypto since 2017. I remember specifically in September of 2017, he was saying, don't talk about me, you'll lose your money. And then Bitcoin went to a new all time highs, of course. And every year he comes on and he says something, well, he's back at it, folks. He said, Bitcoin itself is a hyped up fraud. He said, crypto is a decentralized Ponzi scheme. It's a pet rock. He's bringing back some of the old talking points. And it makes me bullish, guys, because I've seen him do this before. Those of you who are new to the market, those who are not educated by the crypto market cycles and so forth may see this and on its face is like, wow, Jamie Diamond called it a scam. I better not touch this, right? That's the average Joe and Jane who hasn't taken the 20 hours to go and learn about this technology and what's happening.

But this is Jamie's smoke and mirrors move that he's done for a long time. And when you have guys like this, say things on TV, you have to be careful. You have to go research and make sure what they're saying is correct. And it makes sense because they often go out on TV, put a narrative out, and it's not for your benefit, guys. That's what I've learned. It's not for your benefits, for their benefit, whether they're long on the market or they're short on the market, they will put narratives out there. So you've got to be careful. And we've seen Jamie be completely wrong about Bitcoin and crypto for years, right? He goes out there, says all these things. And what's also interesting, he said there could be more than 21 million Bitcoin. He kind of made a joke that the 21 million marks Satoshi is going to come out and laugh at everybody. And so he was kind of making a joke there.

So straight up Fudd, right? Just coming out and he's just at it again. And don't be surprised if you see it again this year. And he was quiet in the last bull market, right? Of course, because the price is going up. Now, maybe he's shorting and that's why he's putting these things out there also. He could be accumulating because he's distracting the public from it. And I'll share some facts here. JP Morgan, despite what Jamie and I is saying, is neck deep in crypto. Remember, they are part of the Ethereum Enterprise Alliance. They developed Quorum blockchain, which was based on Ethereum Consensus, which is a company that helps Ethereum to grow and build and expand, acquire JP Morgan's Quorum. So they're working with the folks at Ethereum on different Ethereum technology and so forth.

So if crypto was a scam, why are you doing this? Here's another example. This is from 2021. JP Morgan, led by Bitcoin skeptic Jamie Dimon, quietly unveils access to half a dozen crypto funds. They did this with NYDIG. Remember that name I keep telling you guys to watch? They are helping small banks and federal credit unions around the United States to be able to offer Bitcoin. And they rolled out, at the time, JP Morgan rolled out access to four funds, excuse me, from Grayscale Investments and one from Osprey Funds. But I thought crypto was a scam. It's a pet rock. See what's happening here, my friends. Here's another example.

This one is from just in November of 2022, reported by Bloomberg. JP Morgan executes its first DeFi trade using public blockchain. Banking giant uses Polygon, which of course native token is Matic, and modified Aave for live trade. See what's happening here, my friends. They're testing DeFi. But I thought crypto was a scam. I thought it was a pet rock. I thought it was the biggest Ponzi scheme ever. If you go to JP Morgan's website, look at this, what they have on their website. They have literature about what they're doing. So here, this page is institutional DeFi, the next generation of finance. And they talk about how they're working with different institutions to do different things with crypto.

And obviously, DeFi is crypto, right? You're using decentralized networks and assets, and they have the literature on their website. So you see what Jamie's doing going on TV. And once again, the average Joe may not go explore and look on the web and say, okay, what is JP Morgan actually doing? They just listened to Jim Cramer. They just listened to what Jamie says on TV. But that's the age old game, right? How they, the institutional investors manipulate retail. So here's another page on their website called digital solutions, enabling instant transfer and clearing a multi-bank, multi-currency assets on a permission decentralized ledger. And this is of course talking about their JPM coin. When Jamie Diamond in 2017 was fighting Bitcoin and crypto, JP Morgan was working on JPM coin. So they were trying to build their own crypto versus the ones that are out there.

Here's another example. Well, actually, this is the 2017 article I was referencing where he said it's worse than tulip bulbs. It won't end well. Someone is going to get killed. You see the narrative he puts out there. This was on September 12th, 2017. And I remember seeing this. I remember watching the video. And the good thing, I didn't listen because I made money in that run up. And it's just the market cycles playing out, right? Guys, the technology is here to say we see big players, BlackRock, BNY, Mellon, and all these folks are entering in while Jamie says his pet rocks and a scam. Don't fall for it.

My friends who are new, don't fall for it. Please do your own research. Even what I'm saying, go validate and read up on your own and you'll see the facts because the facts don't lie. They're right out here in front of you on the internet. There are no, there's no excuses that you can't go verify this for yourself. And I'm telling you, once you see it, you'll recognize what these bangsters, these guys who go on TV and CNBC do. They put a narrative out there to put for their own benefit. Once again, whether they're longing or shorting, or they're looking to accumulate while they distract the public. We saw Kevin O'Leary do that, right? And he was even, he was exposed by many people on this because he was calling crap while he was getting exposure. Then all of a sudden he flipped the narrative. He was promoting FTX and he was promoting crypto, right?

It's so easy for these guys to flip this script once they've taken a position. Now, finally, Brett Harrison, who I've interviewed on the podcast while he was at FTX. Now heads up, Brett did leave FTX way before all this collapse and all this nonsense. He was actually on the FTX US team, so not FTX.com. Well, he launched a new company called Architect here, which provides traders with adaptable infrastructure that redefines access to global digital asset market. So he's still participating in crypto while they've raised a seed round of $5 million. So I'm hoping to get Brett back on the show to talk about this. And he said here, Architect will build institutional grade trading technology that streamlines crypto market structure, making it easier and safer for firms and large traders to access decentralized protocols and centralized exchanges alike. And he goes on and on and so forth. So TLDR, people are still building and they're still getting funding because the institutional investors know markets move in cycles, bear and bull in the bear market, you know, you have the retail run away, but funding is still happening for crypto companies and projects. And these folks are still building big time services, technology solutions because they see what's on the horizon. This is here to stay.

And it is the future. It's the next layer on top of the internet. And I hope you guys see it as well. That's the news, guys. A lot, a lot there. I would love to get your thoughts on Nexo, Genesis, you know, their bankruptcy, Jamie Diamond's flood again. And yeah, let me know what you guys think. And I will talk to you all later.