Europe’s Energy Exchanges Warn Gas Price Cap to Backfire on EU

Nov 21, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

Today we have the obituary for my mother, Marjorie Jane Lothian. It is published on John Lothian News, which costs considerably less than the Chicago Tribune. Though I get the Scottish blood from my father, it is hard not to be thrifty even when it comes to my mom, who was of German and Irish descent. Her maiden name was Knilans, which is Irish, and her mother’s name was Langholf, which is German.

On Friday I conducted an interview with CoinDesk Deputy Managing Editor Nick Baker. Nick is formerly of Bloomberg, but joined CoinDesk three and half months ago. He and one of his writers were the people who published the story about Alameda Research’s balance sheet being mostly full of the FTT native token from FTX. This suggested a house of cards, which quickly collapsed. The interview is about his career and also about CoinDesk, including that story.

You will notice a lot of crypto stories in JLN today. Of course, part of that is because of the FTX Black Hole, which is my name for the FTX implosion. FTX is an energy source that is going to keep on sucking other entities into its darkness.

The other reason there are so many stories is that cryptocurrency trading has become a big thing, with Bloomberg reporting that in 2020, 2.3 million people told the IRS they were trading crypto. That was an increase of 149% from 2019. Of course the pandemic helped, and stimulus money did not just go into meme stocks, but also crypto.

Crypto was seeping into TradFi, which is the term the hip crypto crowd gave for us aging boomers and others in the areas of traditional finance, as well as fintech companies that operate in finance. I hate labels. You might as well call me an old fogey as someone who works in TradFi.

Cargill named Brian Sikes as its new CEO to replace David MacLennan, Bloomberg reported. MacLennan will become the executive chairman of the 157-year old agricultural giant. MacLennan guided Cargill to record profits the last two years, so Sikes should be sitting pretty with a company hitting on all cylinders.

It is interesting to note that MacLennan began his career as a runner on a futures trading floor, became a phone clerk and eventually a risk manager. Those days are gone and MacLennan is one of the last of the old breed.

Oil isn’t the only thing countries fight over. The Wall Street Journal has a story today about heavy fighting erupting in the Congo over minerals titled, “Heaviest Fighting in Years Breaks Out in Congo as Rivals Seek Control of Minerals.” The subheadline is “Clashes erupt between the Congolese army and Rwanda-backed militias as fighting for control of Congo’s vast mineral riches erupts again.”

What are they fighting over? The Congo is home to some of the “largest deposits of tantalum, used in smartphones and personal computers.” There is also tin, gold and coltan in the region.

As difficult a job as being the new CEO of FTX and sorting out the bankruptcy is, it does pay well. CoinDesk reports that John Ray is being paid $1300 per hour for his work. For a standard 40 hour week that is $52,000 per week and a nifty $2.704 million per year.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL

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Chuck Mackie has published a final overall recap of FIA Expo ’22, following his day one and day two recaps of last week. It is called, “News from the Futures: FIA Expo ’22 – Recap” and contains “a dozen final thoughts on the proceedings.” You can read it here.~SR

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Marjorie Jane Lothian, October 9, 1930 – November 15, 2022
JohnLothianNews.com

Marjorie Jane (Knilans) Lothian. 92, of Williams Bay, Wisconsin and Sarasota, Florida and formerly of Glenview, IL died November 15, 2022. She was born in Janesville, Wisconsin on October 9, 1930 to Arthur John and Elsie Emily (Langholff) Knilans. Marge married David Rogers Lothian, Sr. on August 4, 1956 in Janesville, WI and she and Dave had three children, Scott, John and David, Jr.

Read more »

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The Contango Hedge is Getting Ready to Go
JohnLothianNews.com

JLN interviewed Contango CEO Clive Furness at FIA EXPO 2022 about the innovative new way to hedge commodities that he recently released in a white paper, to which he gave the moniker “The Contango Hedge.”

Read more »

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Russell 2000 Index quarterly chartbook – Q3
Russell 2000: The premier investable small-cap US equity index. Explore our Chartbook: A complete interactive experience – Market performance, IPOs, sectors breakdown, risk characteristics.

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Stephen Diehl: Crypto is the ‘commoditisation of populist anger, gambling and crime’; The software engineer has denounced crypto assets as vehicles for pure speculation. But his views have made him a target of harassment – including death threats
Henry Mance – Financial Times
“Cryptocurrency is a giant scam, although a complicated scamâEUR‰.âEUR‰.âEUR‰.âEUR‰” So begins Stephen Diehl’s diatribe against the crypto industry. When he published it in June, Bitcoin and other crypto assets were trembling. Since then, the collapse of FTX, the second-largest crypto exchange, has created a potentially existential crisis. Billions of dollars of customer assets seem to have been incinerated, along with FTX founder Sam Bankman-Fried’s status as an altruistic visionary. Is crypto all just a mirage?
/jlne.ws/3tOJG9A

****** If you are a crypto skeptic, you will love Stephen Diehl.~JJL

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Scammers are targeting desperate FTX customers by pretending to be the DOJ and promising access to funds
Steve Mollman – Fortune
FTX customers around the world no doubt regret their decision to sign on with the now-bankrupt cryptocurrency exchange. Adding insult to injury, they’re now the targets of scammers pretending to be the U.S. Department of Justice. Police in Singapore on Saturday warned about a website pretending to be hosted by the DOJ-and supposedly helping FTX users recover their funds. The site instructs visitors to log in with their FTX username and password. It then claims they’ll be able to withdraw their funds after paying legal fees.
/jlne.ws/3TV1qKY

***** If the scammers have a white shirt and tie, they are doing a decent job of impersonating someone from the DOJ. If not, then forget it.~JJL

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Investor Studied Crypto for Years, Then Missed FTX’s Red Flags; Ontario Teachers was an early booster of corporate governance; The pension fund will write its $95 million investment to zero
Layan Odeh – Bloomberg
When Sam Bankman-Fried was all of 25 years old, he pitched his nascent crypto investment business to Silicon Valley investors — only for them to laugh at him and his acolytes over their lack of experience and knowledge of crypto. “None of us has run a company before and we’d like $100 million by next Tuesday,” Bankman-Fried told David Rubenstein in August about the request. “It was not a very compelling pitch for investors.”
/jlne.ws/3ExPGJ4

****** There must have been a hockey game on when this decision was made and they were distracted.~JJL

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Cigars, Booze, Money: How a Lobbying Blitz Made Sports Betting Ubiquitous; The gambling industry and its allies got their way with lawmakers after showering them with donations, gifts and dubious arguments.
Eric Lipton and Kenneth P. Vogel – The New York Times
Representative John Barker, a cattle breeder, retired judge and chairman of one of the most powerful committees in the Kansas legislature, had a glass of 30-year Redbreast Irish whiskey in his hand and a Don Tomas cigar from Honduras in his mouth. Both had been passed to him as he entered a party a few blocks from the State Capitol. It was co-sponsored by lobbyists who had recently turned to Mr. Barker for help legalizing sports betting in Kansas. “They keep a special bottle for me up there – they know I like it,” he said of the lobbyists as he surveyed the crowded room. “I’m in my element when I have a whiskey and a cigar.”
/jlne.ws/3Eqyo06

***** There are less expensive and destructive ways to release dopamine than gambling.~JJL

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BBC ignores World Cup opening ceremony in favour of Qatar criticism
Jim Waterson – The Guardian
When the Qatari government decided to spend millions of pounds on a World Cup opening ceremony featuring Morgan Freeman, Jungkook from BTS and hundreds of performers, it probably hoped it would be the moment when the global media finally focused on football rather than human rights. What it probably did not expect was that the BBC would ignore the entire event in favour of a broadcast criticising the treatment of migrant workers, highlighting corruption at Fifa and discussing the ban on homosexuality in Qatar. And that was just in the opening two minutes.
/jlne.ws/3tOpJ2O

****** Yellow card on the BBC.~JJL

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Friday’s Top Three
Our top story Friday was Remembering David Lerman, from Salerno Funeral Home, about the longtime CME Group executive, who died a week ago. Our condolences to his family and friends. Second was FTX Hammers More Nails Into Crypto’s Coffin, from Bloomberg. Third was Is This the End Game for Crypto?, an opinion piece from Paul Krugman in The New York Times.

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MarketsWiki Stats
27,088 pages; 241,824 edits
MarketsWiki Statistics

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Lead Stories

Europe’s Energy Exchanges Warn Gas Price Cap to Backfire on EU; Europex sees security of supply at risk with EU proposal; Commission wants to present its regulation this week
Petra Sorge – Bloomberg
Europe’s leading energy exchanges warned that a planned cap on natural gas prices poses a serious threat to the region’s security of supply and financial stability, and will do little to achieve its goal of lowering energy costs. The European Commission’s plan to propose a limit on benchmark gas prices this week will have “potentially irrevocable negative effects” on the functioning of the region’s energy markets lasting well beyond the current crisis, the Association of European Energy Exchanges wrote in joint letter. The commission hasn’t yet unveiled the exact parameters for the last-resort mechanism.
/jlne.ws/3V1OkNK

FTX Says Top 50 Creditors Are Owed $3.1 Billion
Caitlin McCabe – The Wall Street Journal
FTX owes its 50 largest creditors about $3.1 billion, the failed cryptocurrency exchange said in a bankruptcy court filing Saturday. The filing didn’t name the creditors, but it listed them as customers. Two creditors are each owed more than $200 million. FTX’s lawyers have said in all there could be more than one million creditors across FTX’s various entities. Also Saturday, a statement from John J. Ray, the company’s new CEO, struck a slightly more optimistic tone about the possibility of recovering assets to repay those creditors. On Thursday, the veteran bankruptcy executive said he’d never seen anything as bad as FTX in 40 years in the restructuring business.
/jlne.ws/3XhImK2

Crypto Exchange Tokens Pose ‘Extreme’ Risk, BOE’s Cunliffe Says; UK regulator decries exchanges using own tokens as collateral; DeFi has yet to prove it can effectively handle risk
Emily Nicolle – Bloomberg
Exchange-issued crypto tokens such as bankrupt FTX Group’s FTT can pose “extreme” risks when accepted by their issuers as collateral, Bank of England Deputy Governor Sir Jon Cunliffe said. “A firm accepting its own unbacked cryptoasset as collateral for loans and margin payments, as there are indications may have happened with FTX, creates extreme ‘wrong-way’ risk — i.e. when the exposure to a counterparty increases together with the risk of the counterparty’s default,” Cunliffe said in a speech on Monday.
/jlne.ws/3AyqsJ5

Crypto exchanges’ bundling of services threatens stability, says Bank of England official; Deputy governor Cunliffe warns that tighter regulation is needed
Akila Quinio and Joshua Oliver – Financial Times
Crypto exchanges such as the bankrupt FTX that bundle together services kept separate by mainstream institutions should be more tightly regulated before they become a risk to the financial system, a senior Bank of England official has warned. In a speech on Monday, Sir Jon Cunliffe, deputy governor of the Bank of England, said digital asset exchanges created risks to their market by operating businesses that encompassed trading, lending, clearing and custody of client assets.
/jlne.ws/3TW7wLp

Inside the Billion-Dollar Market for Junk Carbon Offsets; An examination of the sellers, verifiers and buyers of a popular climate solution tied to renewable energy. Experts say it might end up actually increasing emissions
Akshat Rathi – Bloomberg
Rising acceptance that the world needs to cut carbon emissions fast has coincided with a parallel rise in ineffective solutions to the problem. There’s now real danger that tools meant to slow global warming may end up allowing more emissions. A prime example of that risk is carbon offsets.
/jlne.ws/3OnUzZo

Junk Carbon Offsets Are What Make These Big Companies ‘Carbon Neutral’; Dozens of the biggest global companies – from banks to industrial heavyweights – have made bold climate claims justified by cheap renewable-energy offsets that don’t counteract global warming
Akshat Rathi, Natasha White and Demetrios Pogkas Green – Bloomberg
For more than a decade, Credit Suisse Group AG has claimed to be “carbon neutral” in its operations. Every gleaming office tower, every flight by an executive – all the emissions generated directly by a global banking giant are supposedly counterbalanced. A closer look at the Swiss bank’s sustainability reports tells a different story: its sweeping claim is based on purchases of low-quality carbon offsets that experts rate as useless.
/jlne.ws/3UWRqT5

After FTX, Crypto Exchanges Struggle to Convince Customers They’re Safe; Exchange token reserves fall in wake of FTX’s sudden collapse; Binance, Crypto.com among venues seeking to assuage concerns
Anna Irrera and Sidhartha Shukla – Bloomberg
Moves by cryptocurrency exchanges to reassure markets about their stability are having little effect on jittery users, who keep pulling funds from the venues. Platforms from Binance to Crypto.com have made full or partial disclosures outlining their assets since FTX.com unraveled last week. Yet clients’ stampede for the exits has persisted, with exchange reserves of Bitcoin, Ether and stablecoins falling sharply, according to data from CryptoQuant.
/jlne.ws/3V8EOb0

FTX Owes Its Largest Creditor $226M; Top 50 Owed Total of About $3.1B
Sam Reynolds – CoinDesk
FTX’s largest creditors have claims ranging from hundreds of millions to tens of millions of dollars, according to a recently filed court document. This document shows that of FTX’s estimated 1 million creditors, the largest single claim is for $226 million and the second is for $203 million. The identities of these creditors are not named, but collectively they are owed approximately $3.1 billion.
/jlne.ws/3EtJ8e6

FTX’s Federal Net Operating Loss Carryover Stood at $3.7 Billion; Latest documents in FTX’s bankruptcy touch on operating losses; Advisory firm says FTX historically didn’t keep reliable books
Suvashree Ghosh – Bloomberg
Crypto exchange FTX and related companies now in bankruptcy collectively had a carryover federal net operating loss of at least $3.7 billion as of Dec. 31 last year based on tax returns, according to court filings. The document from Alvarez & Marsal North America LLC, released as part of the Chapter 11 process, also showed that the minimum state net operating loss carryforward stood at $715 million.
/jlne.ws/3i1Jhy3

DeFi Is the Answer to the FTX Crisis-But We Must Get Better at Communicating It
Index Coop – Decrypt
For those of us building in decentralized finance (DeFi), the events of the last two weeks are singularly disheartening. Innocent users were harmed and in some cases lost their entire life savings. As the scope of fraud, negligence and malfeasance at FTX is revealed in court filings and leaked documents, the crisis has already undermined the credibility of our entire ecosystem. It is a bitterly ironic turn of events, since the vision of DeFi is a financial system where what happened at FTX is not just improbable, but impossible.
/jlne.ws/3XxrizZ

Crypto: new asset, old problem; The demise of FTX mirrors any number of traditional financial meltdowns in the past
Rana Foroohar – Financial Times
If the bankruptcy of FTX and the subsequent meltdown of all things crypto have shown us anything, it is that this time still isn’t different when it comes to the financial sector and risk. The product at the heart of the current market collapse may be high tech, but the details of how we got here mirror many aspects of the 2008 financial crisis, and other periods of financial speculation such as the dotcom bubble, or even the run-up to the 1929 market collapse.
/jlne.ws/3GyAihX

FTX and Alameda Research didn’t have their own accounting department – and it’s impossible to rely on any of their financials, bankruptcy filing says
George Glover – Business Insider
Sam Bankman-Fried’s bankrupt crypto exchange FTX didn’t have its own accounting department and its financial statements cannot be relied on, according to a bankruptcy court filing released on Thursday. John Ray III said that FTX’s lack of an in-house accounting team meant that it was now struggling to provide him with reliable financial statements as he oversees the group’s restructuring as its new chief executive. “The debtors are locating and securing all available materials but expect it will be some time before reliable historical financial statements can be prepared for the FTX Group with which I am comfortable as Chief Executive Officer,” he said. “The debtors do not have an accounting department and outsource this function.”
/jlne.ws/3i1imm4

Alameda Had ‘Secret Exemption’ From FTX Liquidation Protocols, New CEO Says
Danny Nelson and Jack Schickler – CoinDesk
Alameda Research, the trading vehicle at the center of Sam Bankman-Fried’s and FTX’s downfall, had a “secret exemption” from the crypto exchange’s liquidation procedures, according to bankruptcy filings Thursday. The revelation in a court filing, though scant on details, would indicate that Alameda held an advantage when making risky leveraged trades on FTX. Crypto derivatives exchanges such as FTX automatically sell the collateral of traders who borrowed its money to place bets that turned south.
/jlne.ws/3EmIsat

Why the Investing Pros Were Such Suckers for FTX; With billions of dollars at stake, lots of smart people turned a blind eye to the crypto company’s red flags
Jason Zweig – The Wall Street Journal
In the spectacular collapse of FTX, the cryptocurrency exchange, millions of fingers already seem to be pointing at Sam Bankman-Fried, the frizzy-haired boy wonder who founded the firm, drove it to a valuation of $32 billion and then took it into bankruptcy. Mr. Bankman-Fried-known as SBF-resigned as chief executive Nov. 11, the day FTX filed for bankruptcy protection and appointed a new CEO, John J. Ray III. SBF may be at the center of what went wrong, but he didn’t act alone. Behind him lies a vast ecosystem of fantasy and fakery. It’s called the investing business. If we’re going to point fingers, let’s be sure we aim at all the right targets.
/jlne.ws/3EqbHt3

Silbert’s Once-$10 Billion Crypto Empire Is Showing Cracks
Katie Greifeld and Vildana Hajric – Bloomberg
Suspended withdrawals at cryptocurrency brokerage Genesis amid the widening crypto-market meltdown have cast an unwanted spotlight on Barry Silbert, the man at the helm of the Digital Currency Group empire. Silbert, who rarely does press interviews or speaks at the multitude of industry conferences, founded the Stamford, Connecticut-based crypto conglomerate DCG in 2015, according to the 46-year-old’s LinkedIn profile. Last year, DCG’s valuation reached $10 billion, after it sold $700 million of stock in a private sale led by SoftBank Group Corp. DCG had 66 employees at the start of November and holds more than 200 companies in its portfolio.
/jlne.ws/3AyHI0O

Twitter Staff Wipeout Under Musk Spurs Fear Site Will Decay; App increasingly vulnerable to hacks, bugs that can’t be fixed; World Cup may overload already-stressed Twitter systems
Davey Alba, Jack Gillum, and Margi Murphy – Bloomberg
Twitter Inc.’s mass exodus of employees leaves the platform vulnerable to a broad range of malfunctions. The social network will succumb to a major glitch at some point, technologists predict. It’s just a matter of when. The social network’s staff has shrunk to a fraction of its size since Elon Musk took over at the end of October, through layoffs and resignations. Musk this week asked employees to sign on to a more “hardcore” version of their jobs or leave; astonishing numbers opted out.
/jlne.ws/3VfsOo6

Misinformation threatens Twitter’s function as a public safety tool
Lauren Hodges – NPR
When Michele Rogosky heard about the shooting at The University of Virginia on Sunday night, she called her son right away, panicking. He’s a student there, and she knew he liked to go to the gym late in the evening. It turns out, he was sheltering in his apartment with his roommates, and knowing that helped her calm down. But the situation was precarious, with the suspect at large at the time, and little information available. Rogosky lives 400 miles from Charlottesville, in Long Island, New York. Normally, she says she would have gone on Twitter to check the university’s public safety accounts and look for updates. But something stopped her this time.
/jlne.ws/3hOWeuU

Bankrupt FTX Fires Three of Sam Bankman-Fried’s Top Deputies; The three executives and Mr. Bankman-Fried are said to have known FTX was using customer funds to plug a funding gap
Justin Baer and Hannah Miao – The Wall Street Journal
FTX, the cryptocurrency exchange launched by Sam Bankman-Fried, said it fired three of the founder’s top deputies. Gary Wang, an FTX co-founder and its chief technology officer; FTX engineering director Nishad Singh; and Caroline Ellison, who ran Mr. Bankman-Fried’s trading arm, Alameda Research, were terminated from those roles after FTX tapped John J. Ray to oversee the companies’ bankruptcy, an FTX spokeswoman said late Friday.
/jlne.ws/3Omeo3o

How Caroline Ellison Found Herself at the Center of the FTX Crypto Collapse; As CEO of Alameda Research, Ms. Ellison took a leading role in helping Sam Bankman-Fried build the FTX empire
Hannah Miao and Justin Baer – The Wall Street Journal
On a video call in early November, employees at Alameda Research dialed in to learn the fate of the trading firm, which was teetering on the brink. It was up to Caroline Ellison to deliver the bad news. Alameda was at the center of Sam Bankman-Fried’s collapsing FTX empire. Ms. Ellison, who had just turned 28, was at the center of Alameda. And they were all in crisis.
/jlne.ws/3TSVvWX

They Lived Together, Worked Together and Lost Billions Together: Inside Sam Bankman-Fried’s Doomed FTX Empire
Alexander Osipovich, Caitlin Ostroff, Patricia Kowsmann, Angel Au-Yeung and Matt Grossman – The Wall Street Journal
Sam Bankman-Fried’s $32 billion crypto-trading empire collapsed in an incandescent bankruptcy last week, prompting irate customers, crypto acolytes and Silicon Valley bigwigs to ask how something that seemed so promising could have imploded so fast. The emerging picture suggests FTX wasn’t simply felled by a rival, or undone by a bad trade or the relentless fall this year in the value of cryptocurrencies. Instead, it had long been a chaotic mess.
/jlne.ws/3EKJzCh

What to know about Sam Bankman-Fried, FTX’s embattled founder; The crypto star faces scrutiny after the collapse of his $32 billion company.
Max Zahn – ABC News
The collapse of $32 billion cryptocurrency exchange FTX, like other scandal-ridden corporate failures, has yanked a once-celebrated executive into the harsh light of public scrutiny. Sam Bankman-Fried, the 30-year-old founder of FTX, quickly ascended to the top of the cryptocurrency sector, garnering goodwill in recent years as a philanthropist and leading proponent of industry regulation. The cover of Fortune Magazine in August asked readers whether Bankman-Fried, known by some as “SBF,” was “the next Warren Buffett.”
/jlne.ws/3tNt8im

Polyamory, penthouses and plenty of loans: inside the crazy world of FTX
Alex Hern – The Guardian
Casual observers could be forgiven for thinking the collapse of the cryptocurrency exchange FTX is another typical tale of financial mismanagement. That’s how its founder, Sam Bankman-Fried, terms it: a liquidity crisis that tipped over into a solvency one. FTX had deposits and loans and when depositors tried to get their money back, FTX didn’t have it to hand. Sure, the loans were in fancy digital money, rather than stale dollars, but at first glance, it appears like just another big company failure.
/jlne.ws/3tOnzjy

FTX Crypto Customers Worry They Will Never See Their Money Again; ‘My blood is boiling.’ Some were optimistic a week ago. Now they are increasingly losing hope.
Caitlin McCabe and Rachel Louise Ensign – The Wall Street Journal
Customers of beleaguered crypto exchange FTX are losing hope they will ever see their money again. The company’s massive financial problems began spilling into the open early this month, and FTX was quick to halt withdrawals from its international unit. American customers had hoped they might be luckier, but many of them haven’t been able to get their money out either.
/jlne.ws/3Om60B2

Meta’s Meltdown Shows How Big Tech’s Invincible Era Is Over; For years, Facebook, Amazon, Apple, Netflix and Google-the revered FAANG companies-were great investments. But a brutal quarter has revealed that they’re no longer sure things.
Jeran Wittenstein – Bloomberg
When a big stock dives, as Meta Platforms Inc. did on Oct. 27, dropping almost 25%, investors are often urged to take the long view of its performance. In this case, it hardly helps. If you bought Meta five years ago-back when the company was still known as Facebook-you’d be down about 49%, in a period when the S&P 500 climbed 45%. Meta has not only erased its gains from the pandemic, which turned social media into an essential technology, but also fallen back to where it was in 2015.
/jlne.ws/3i1yxzP

‘Queen Caroline’: The ‘Fake Charity Nerd Girl’ Behind The FTX Collapse
David Jeans, Sarah Emerson, Richard Nieva and Michael del Castillo – Forbes
In 2021, Caroline Ellison, the CEO of Alameda Research who oversaw crypto traders allegedly playing roulette with billions of FTX’s customer funds, was asked if she had any advice for her younger self. Her reply was earnest and brief. “I would tell her to be less risk-averse and believe in herself more,” she wrote in a previously unpublished application for Forbes’ 30 Under 30 list.
/jlne.ws/3EO609A

CFOs May Have the Toughest Job in the C-Suite; Don’t think of them as bean counters anymore. These days they’re more like strategic advisers.
Daniela Sirtori-Cortina – Bloomberg
In March 2020, Gina Mastantuono had been chief financial officer at software maker ServiceNow Inc. for about two months. When the pandemic hit, she had to make a series of snap decisions, including advising the chief executive officer to continue with hiring and expansion plans despite the prospect of slower revenue growth and shifting most of the company’s 10,000 employees to remote work.
/jlne.ws/3EomvI8

Ukraine Invasion

Ukraine says half its energy system crippled by Russian attacks, Kyiv could ‘shutdown’
Max Hunder and Jonathan Landay – Reuters
Russian missile strikes have crippled almost half of Ukraine’s energy system, the government said on Friday, and authorities in the capital Kyiv warned that the city could face a “complete shutdown” of the power grid as winter sets in. With temperatures falling and Kyiv seeing its first snow, officials were working to restore power nationwide after some of the heaviest bombardment of Ukrainian civilian infrastructure in nine months of war.
/jlne.ws/3El1Jcw

Russian Spy Defects, Calls Putin’s Ukraine War ‘Worst Scenario’ Imaginable
Zoe Strozewski – Newsweek
ARussian spy has reportedly defected to Estonia and is now seeking asylum in the NATO country over his opposition to Russia’s ongoing war in Ukraine. The spy, identified as Artem Zinchenko, spoke to Yahoo News in early October for an article published Thursday about the “awful situation” triggered by Moscow’s invasion of Ukraine that started in late February. “It is the worst scenario that could even be imagined in my mind, and it was not only because my relatives live there, but because of the huge number of innocent victims,” Zinchenko said.
/jlne.ws/3EmOQ1z

Ukraine says around 60 Russians killed in long-range shelling attack
Reuters
Around 60 Russian soldiers were killed in a long-range Ukrainian artillery attack this week, Kyiv said on Saturday, the second time in four days that Ukraine claimed to have inflicted major casualties in a single incident. In a Facebook post, the armed forces general staff said Russia suffered the losses on Thursday when Ukrainian forces shelled the town of Mykhailkva, 40 km (25 miles) to the south of Kherson. Russian forces abandoned the city earlier this month.
/jlne.ws/3GutGkR

Russia’s War Rewires Trade, the Cost of Shipping Oil Surges; Supertanker earnings surge to the brink of $100,000 a day; An unprecedented reshaping of oil trade routes is underway
Elina Anya Ganatra – Bloomberg
Oil tanker tycoons are enjoying a surge in revenue as the sanctions triggered by Russia’s war are redrawing the global trade in crude. And it’s set to last. The disruption is fairly simple. Europe, for decades the top buyer of Russian oil, is banning purchases from Moscow next month and has already been cutting back. Those cargoes are instead flowing out to Asia. The result is ships sailing thousands of miles further, driving up a vital aspect of demand.
/jlne.ws/3TOQjmR

Ukraine Plans to Raise Oil Transit Fee After Russian Strikes; Tariff on flows to Hungary, Slovakia at €13.60/ton from 2023; Ukrtransnafta’s costs rose due to attacks on infrastructure
Bloomberg News
Ukraine plans to raise transit fees for Russian oil through the Druzhba pipeline to eastern Europe next year due to Moscow’s attacks on the nation’s power supplies. Ukrtransnafta JSC, the operator of Ukraine’s oil pipeline network, informed its Russian counterpart Transneft PJSC that “continued destruction of the Ukrainian energy infrastructure has led to a significant shortage of electricity, an increase in its costs, a shortage of fuel, spare parts,” according to a letter from the company seen by Bloomberg.
/jlne.ws/3OouNUY

Russia Loses 90% of Its Key European Oil Market Before Sanctions; Shipments to northern Europe have fallen below 100,000 barrels a day
Julian Lee – Bloomberg
With just two weeks to go until European Union sanctions come into force, Russia has already lost more than 90% of its market in the bloc’s northern countries, previously the mainstay of shipments from the Baltic and Arctic terminals.
/jlne.ws/3tQl4gR

Exchanges, OTC and Clearing

Russia’s Mining Giants Rush to Sell Metal After LME Green Light; Annual contracts had been on ice as LME discussed Russian ban; Some buyers still ‘self sanction’ by shunning Russian metals
Bloomberg
The London Metal Exchange’s decision not to ban Russian metal from its warehouses has triggered a rush to conclude contracts with the country’s two big producers. The LME’s discussion about whether to ban Russian metal had prompted some buyers to delay signing annual supply deals with MMC Norilsk Nickel PJSC and United Co. Rusal International PJSC. Now contracts with both companies are being finalized.
/jlne.ws/3tRlh36

MARF admits a new 100-million-euro Green Commercial Paper Programme from Holaluz
BME-X
BME’s Fixed Income Market, MARF, today admitted Holaluz-Clidom’s first Green Commercial Paper (CP) Programme for 100 million euros. This programme will allow Holaluz to access qualified investors flexibly over the next twelve months and diversify its financing sources by issuing CP issues. Holaluz has structured the CPs to be issued under the Green Note Programme to qualify as a “green instrument” under the Holaluz Green Finance Framework, under which the company can issue bonds and notes in accordance with the Green Bond Principles 2021 and enter into financing contracts in accordance with the Green Loan Principles 2021 of the International Capital Markets Association (“ICMA”). To this end, Holaluz has obtained a favourable opinion from Sustainalytics confirming that the Holaluz Green Finance Framework is aligned with the four fundamental principles that make up both principles.
/jlne.ws/3V9D6pQ

SET unveils roadmap to help companies achieve ESG goals
Poramet Tangsathaporn – Bangkok Post
The Stock Exchange of Thailand (SET) has prepared three mechanisms to help listed firms achieve their Environmental, Social, and Governance (ESG) goals. Speaking at the Bangkok Post conference on “The Rise of ESG: The Megatrend and Sustainability Challenges” at Centara Grand at CentralWorld on Friday, SET President Pakorn Peetathawatchai said the SET is the SET is holding to its commitment to promote good governance and zero carbon emissions among listed companies by preparing the aforementioned mechanisms.
/jlne.ws/3XjyhMA

DTCC Launches The Report Hub Service Assisted Reporting Model To Help Market Participants Meet Trade Reporting Obligations; New model enables prime brokers and clearing brokers to assist their buy-side clients with reporting
DTCC
The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, today announced that it has launched DTCC Report Hub’s assisted reporting model, allowing sell-side firms to assist their buy-side clients with regulatory reporting obligations around the world. Report Hub is a leading pre- and post-trade reporting solution that helps firms manage the complexities of meeting multiple regulatory mandates across jurisdictions and asset classes.
/jlne.ws/3AAgqat

TMX CEO John McKenzie says Ottawa’s proposed tax on share buybacks is ‘bad policy.’ He’s right
Rita Trichur – The Globe and Mail
The Trudeau government keeps picking on public companies. After slapping large banks and insurance companies with a special levy and a discriminatory surtax on their profits, Liberal legislators are concocting a new cash grab that targets a larger swath of our capital markets. Ottawa plans to impose a 2-per-cent tax on share buybacks by public companies starting on Jan. 1, 2024. Problem is, the move is a cynical attempt to micromanage corporations’ payouts to their shareholders.
/jlne.ws/3tP1stA

Nigel Babbage – Champion of NZ Capital Markets
NZX via Mondovisione
The NZX Board and management today recognised the sudden passing of Board member Nigel Babbage in Christchurch yesterday. NZX Chair James Miller said Mr Babbage, an NZX Board member since 2017, had been a long-term advocate of NZX and stock markets. He had also served on the Foreign Exchange Committee of the Federal Reserve Bank of New York. “Nigel was a proud champion of NZX as a board member and significant shareholder. He was a man of immense passion and integrity something he demonstrated throughout his 35-year career as a currency trader, businessman, conservationist and director,” Mr Miller said.
/jlne.ws/3Etlte3

Hearing Before The Disciplinary Committee Of Bourse De Montreal Inc. Morgan Stanley & Co. LLC
TMX
The Disciplinary Committee of Bourse de Montreal Inc. (the “Bourse”) will hold a hearing on December 15, 2022 at 9:30 a.m. by videoconference, in order to decide on the acceptance of a settlement agreement negotiated between the staff of the Regulatory Division of the Bourse and Morgan Stanley & Co. LLC (“MSCO”), in connection with a disciplinary complaint filed against MSCO.
/jlne.ws/3Gwmd4L

Practice Session and Calculation on Trading Fee Structure Enhancement
HKEX
Reference is made to the Exchange Circular (Ref No.: CT/141/22) dated 1 November 2022 in relation to the implementation of the Trading Fee Structure Enhancement from 1 January 2023. Amendments to relevant rules, regulations and procedures can be found in the Exchange Circular (Ref No.: LSD/086/2022) dated 14 November 2022
/jlne.ws/3XkgZPv

Redburn becomes latest broker to join SIX Swiss Exchange; The equities broker is the sixth new participant to join the venue this year.
Laurie McAughtry – The Trade
Redburn (Europe) has joined SIX Swiss Exchange as its newest trading participant, making it the sixth new entrant to join the venue in 2022. The company provides institutional investors with equity research, quantitative and technical analysis, economics research and agency execution in European and North American equity markets.
/jlne.ws/3hQ3yXa

Fintech

Tech Layoffs Send H-1B Visa Holders Scrambling for New Jobs; Hundreds of people in the US on temporary work visas may need to leave the country if they can’t find new sponsors.
Sinduja Rangarajan, Brody Ford, and Katrina Manson – Bloomberg
Mass tech layoffs have left hundreds of workers living in the US on temporary visas with little time to find another job, or they’ll have to leave the country. And many say they’re getting inadequate guidance from the companies that sponsored them.
/jlne.ws/3ErdCgZ

Applying AI to the war on financial crime; Regulators’ demands, a crackdown on money laundering and sanctions on Russia are driving growth for ComplyAdvantage
Laura Noonan – Financial Times
Clouds are gathering over swaths of fintech companies, as falling economic growth, rising interest rates and a cost of living crisis put their business models under strain, forcing job cuts and valuation-crushing funding rounds. ComplyAdvantage founder Charlie Delingpole knows his company is not immune to those forces, as fintechs are among the biggest buyers of his financial crime prevention products. In fact, some clients, including crypto lender Celsius Network, have already gone bust.
/jlne.ws/3gv1V0G

Solana Loses $1 Billion in USDT to Ethereum in Tether Chain Swap
Mathew Di Salvo – Decrypt
Stablecoin issuer Tether today announced a $1 billion chain swap to convert USDT it had on the Solana blockchain to the Ethereum blockchain. The announcement comes as Solana, which just weeks ago ranked within the top 5 biggest cryptocurrencies by market cap, faces difficulties following the collapse of crypto exchange FTX. Solana now ranks 16th by market cap and is down 25.4% in the last seven days. It is currently trading hands for $13.33, down 95% from its all-time high of $256.
/jlne.ws/3tMMjZy

Ethereum Co-Founder Vitalik Buterin Says FTX Saga Offers Lessons for Crypto; Buterin says FTX “a huge tragedy” but blockchain tech stable; Says crypto is a long way from reaching its full potential
Joanna Ossinger – Bloomberg
The collapse of FTX contains lessons for all of crypto, according to Ethereum co-founder Vitalik Buterin. Buterin emphasized the stability of crypto’s so-called underlying technology, the blockchain, while acknowledging the heavy impact of the meltdown of the Sam Bankman-Fried crypto empire. In the days since FTX filed for bankruptcy, entities ranging from BlockFi to Genesis to Gemini have been hit by the fallout.
/jlne.ws/3golyaU

With Crypto in Retreat, Central Banks Take a Quantum Leap; Monetary authorities are road-testing a new electronic currency that’s fast and anonymous, yet unfriendly to criminals and impervious to hacking by powerful computers.
Andy Mukherjee – Bloomberg
In the chaos surrounding the collapse of Sam Bankman-Fried’s empire, it’s easy to lose sight of what has died in this year’s crypto carnage and what lives on. The biggest casualty is “anarcho-capitalism,” championed by engineer Timothy May in the 1990s as cyberspace interactions unconstrained by external regulation, taxation or interference – in short, an absence of government.
/jlne.ws/3tNXhOE

Cybersecurity

Cybersecurity frameworks are not enough to protect organizations from today’s threats
Gidi Cohen – VentureBeat
As cybersecurity incidents proliferate, critical infrastructure and global enterprises are increasingly targeted by financially-motivated cybercriminal gangs and even nation-state threat actors. Today’s organizations are facing multiplying threats and increasing risks from a constantly-evolving threat landscape. Last year, new cryptojacking and ransomware programs increased by 75% and 42%, respectively, all while OT vulnerabilities leaped 88%. Overall, companies experienced an average of 270 attacks in 2021, up 31% over 2020.
/jlne.ws/3VgKf86

Offshore US Oil, Gas Facilities at ‘Significant’ Risk of Cyberattack, Watchdog Warns; Successful cyber attack could be ‘potentially catastrophic’; GAO report warns of threat posed by ‘malicious state actors’
Ari Natter – Bloomberg
Offshore US oil and natural gas installations are “at significant risk” of cyber attack, according to a federal watchdog that warned of a potential disaster on par with the 2010 Deepwater Horizon blowout. The Government Accountability Office found that offshore exploration equipment, including those critical to safety, are increasingly reliant on remote technology that’s vulnerable to cyber attack. Efforts by the Interior Department arm charged with overseeing drilling safety have not “resulted in substantial action,” the GAO said in its report.
/jlne.ws/3VdP8yB

Cryptocurrencies

Here Are the Wildest Parts of the New FTX Bankruptcy Filing; “Never in my career have I seen such a complete failure of corporate controls…”
Tracy Alloway – Bloomberg
Lawyers for the bankrupt crypto exchange FTX filed today in Delaware, asking a federal judge to transfer to the state a competing bankruptcy case filed in New York by Bahamian liquidators. The filing includes a sworn declaration by John J. Ray, who famously oversaw the liquidation of Enron Corp. and is now the acting CEO and chief restructuring officer for FTX following its sudden collapse last week. The so-called ‘First Day Motion’ is quite something.
/jlne.ws/3hVonk6

Investor Studied Crypto for Years, Then Missed FTX’s Red Flags
Layan Odeh – Bloomberg
When Sam Bankman-Fried was all of 25 years old, he pitched his nascent crypto investment business to Silicon Valley investors — only for them to laugh at him and his acolytes over their lack of experience and knowledge of crypto. “None of us has run a company before and we’d like $100 million by next Tuesday,” Bankman-Fried told David Rubenstein in August about the request. “It was not a very compelling pitch for investors.”
/jlne.ws/3hOTWfg

Why FTX Picked the Bahamas, And What Happens Now to the Crypto Hub; In an effort to court crypto companies, the country enacted a comprehensive legal framework for digital assets.
Wall Street Journal (VIDEO)
More than a year before its collapse, FTX moved its headquarters to the Bahamas-a country that worked to lure crypto companies to its shores. So what makes the nation attractive to crypto? And how could FTX’s demise change that? Illustration: Adele Morgan
/jlne.ws/3Attcaz

Shares of Crypto Bank Silvergate Continue to Fall Despite CEO’s Remarks
Elizabeth Napolitano – CoinDesk
Silvergate Capital (SI) shares fell Friday morning in a sign that FTX’s rapid unraveling continues to rattle investors. On Thursday, Silvergate CEO Alan Lane tried to assuage investors that market volatility precipitated by FTX’s collapse would not affect the crypto banker’s business. “Suffice it to say, whether deposits are up or down, we have the liquidity and the capital ratios to support the volatility,” said Lane at the Oppenheimer Blockchain & Digital Assets Summit.
/jlne.ws/3UVs0VL

FTX founder’s remarks pose challenge for his lawyers
Andrew Goudsward – Reuters
FTX founder Sam Bankman-Fried, facing mounting legal challenges over the collapse of his cryptocurrency exchange, may have harmed his defense by speaking publicly in recent days, legal experts said. Bankman-Fried has sought to explain the implosion of FTX and disparaged government regulators in posts on Twitter and conversations with reporters. Attorneys said such statements will likely make life more difficult for the defense lawyers seeking to manage fallout from the exchange’s demise and navigate multiple federal investigations.
/jlne.ws/3GBF1zt

Why Crypto Taxes Get Complicated (Especially for Institutions)
Shawn Douglass – CoinDesk
Accounting and tax compliance in crypto is much more complicated for institutions, such as funds, exchanges and prime brokerages, due to the volume of transactions that require record-keeping. Failing to file taxes properly can result in substantial fines and, in some cases, audits. These high financial stakes combined with the difficulty of tracking so much complex transaction data has kept many institutions out of crypto to date. Understanding tax requirements and implementing programmatic record-keeping can be a good starting point for institutions to demystify crypto tax laws and reap the rewards of participating in this fast-growing ecosystem.
/jlne.ws/3i1rpU5

The Enron man in charge of restructuring FTX has one big takeaway from this bankruptcy: There is no paper trail
Jeff John Roberts – Fortune
Corporate bankruptcies are usually pretty dull affairs. That’s not the case with FTX, which until two weeks ago was seen as the golden child of cryptocurrency, but now appears to have been a giant Ponzi scheme. All this has led FTX’s new caretaker CEO, John Ray III, to declare this the worst trainwreck he has ever seen. And that’s really saying something, since Ray is a restructuring expert who has presided over some of the most infamous bankruptcies in history-including energy giant Enron in 2001, a comparison that some onlookers have made, notably including former Treasury Secretary Larry Summers.
/jlne.ws/3EKI86R

FTX’s Sam Bankman-Fried Cashed Out $300 Million During Funding Spree
Eliot Brown, Caitlin Ostroff and Berber Jin – The Wall Street Journal
When FTX raised $420 million from an array of big-name investors in October last year, the cryptocurrency exchange said the money would help grow the business, improve user experience and allow it to engage more with regulators. Left unmentioned was that nearly three-quarters of the money, $300 million, went instead to FTX founder Sam Bankman-Fried, who sold some of his personal stake in the company, according to FTX financial records reviewed by The Wall Street Journal and people familiar with the transaction.
/jlne.ws/3UThUox

FTX Bankruptcy Bombshells Squeeze Crypto Lenders Behind Bull Run; Many crypto investors’ funds are frozen in high-yield accounts; Will be a ‘long time’ before one retail trader lends again
Michael P. Regan, Claire Ballentine, and Olga Kharif – Bloomberg
It was the Winklevoss twins, those Olympic rowers and Harvard schoolmates of Mark Zuckerberg, who made Ryan Horban feel comfortable enough to enter the risky realm of cryptocurrency lending. Investing FOMO was raging early last year and Horban watched as tweet after tweet crossed his feed, each boasting of the fortunes everyone else seemed to be making. He took the plunge and put some coins into Gemini Earn, a Winklevoss vehicle that paid depositors interest rates of 7.4% at one point.
/jlne.ws/3VeN4X3

Sam Bankman-Fried’s Island Haven Is Drawing Scrutiny After FTX Demise; Bahamas embraced the prestige brought by the crypto empire; Regulator says it took control of some assets for safekeeping
Katanga Johnson and Jennifer Epstein – Bloomberg
Sam Bankman-Fried loved living in the Bahamas. Shacked up in his luxury penthouse with nine FTX colleagues, he could wander Nassau without being hassled. And the Bahamas loved Bankman-Fried, the prestige of his crypto empire and the potential fortunes that it would bring. Their relationship, which had seemed innocuous, is now under the spotlight after FTX’s rapid demise, with lawyers for the crypto exchange accusing Bankman-Fried of undermining reorganization efforts with “incessant and disruptive tweeting.” They also raised the suggestion that some FTX assets were ordered to be transferred to the Bahamian government after the bankruptcy filing.
/jlne.ws/3GsFsw2

FTX investors fear they lost everything, and wonder if there’s anything they can do
Chris Arnold – NPR
FTX spent big money to make trading crypto popular and gain people’s trust. The company had an arena in Miami named after it and aired scores of TV commercials with superstars like Tom Brady and Steph Curry. “I’m not an expert and I don’t need to be,” NBA champion Curry says in one ad. “With FTX I have everything I need to buy sell and trade Crypto safely.” Trade Crypto safely? Apparently not.
/jlne.ws/3gpqufE

FTX fires three of its top executives – WSJ
Reuters
Cryptocurrency exchange FTX, which recently filed for U.S. bankruptcy court protection, has fired three of its top executives, including co-founder Gary Wang, the Wall Street Journal reported on Friday, citing an FTX spokeswoman. The other fired executives were engineering director Nishad Singh and Caroline Ellison, who ran FTX’s trading arm Alameda Research, the newspaper said. FTX did not immediately respond to a request from Reuters for comment.
/jlne.ws/3Gukf4V

The unbelievably fast world of Caroline Ellison where ‘someone suggests something’ then ‘an hour later and it’s already happened’
Jordan Hart – Business Insider
Caroline Ellison said she took a “blind leap into the unknown” when she left her Wall Street job to join former coworker, Sam Bankman-Fried, in the fast-paced – almost instantaneous – environment of Alameda Research. Around 2018, Ellison left her job at Jane Street Capital to join Alameda Research, the crypto exchange company founded by Bankman-Fried the year prior. The environment of the bold young company was a bit different than her Wall Street gig, Ellison said in a 2020 FTX podcast episode, as first reported by the Wall Street Journal
/jlne.ws/3GyxzFj

Celebrities Frantically Deleting Tweets Shilling FTX Before Its Collapse
Maggie Harrison – The Byte
You know what they say: if you do something wrong, delete all the evidence as quickly as possible. Or, if you have one, get your assistant to do it, as we imagine someone as rich, famous, and probably embarrassed as forcibly retired FTX ambassador and un-forcibly un-retired NFL quarterback Tom Brady probably would. Gawker has confirmed that in the wake of the FTX implosion, the decorated athlete has deleted all Twitter evidence of his partnership with the embattled cryptocurrency exchange, for whom he and his soon-to-be-ex-wife, Gisele Bündchen, were public – and equity-paid – faces.
/jlne.ws/3EJx1tV

Silvergate Capital Shares Slide as FTX Fallout Attracts Short Sellers
Max Reyes – Bloomberg
Silvergate Capital Corp. shares slumped, putting them on pace to lose a quarter of their value this week, as investors punished the bank for its ties to the bankrupt FTX cryptocurrency exchange. Shares of the company, which held deposits for FTX, dropped 9.9% to $25.14 at 1:03 p.m. in New York. Thursday’s nearly 11% drop triggered a short-sale circuit breaker. Data from S3 Partners indicates short interest levels in Silvergate are around 11% of the shares available for trading.
/jlne.ws/3URZrsv

New FTX CEO Calls Management ‘Complete Failure’
Bloomberg (VIDEO)
Ether Capital CEO Brian Mosoff joins Caroline Hyde and Sonali Basak to discuss the impact of the FTX empire’s collapse on crypto, on staking, and regulation.
/jlne.ws/3Gy3WDX

Crypto Whistleblowers in Line for Multimillion-Dollar Payouts; Commission’s Kristin Johnson encourages them to come forward; She says possible payouts for whistleblowers are ‘very big’
William Shaw and Eva Szalay – 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. Commodity Futures Trading Commission’s Kristin Johnson 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.
/jlne.ws/3EOEvNh

Crypto Fund Sino Global Had Deep Ties to FTX Beyond Equity Investment
Sam Reynolds – CoinDesk
Sino Global Capital, one of Asia’s biggest and most well-known crypto investors, led by Matthew Graham, tweeted a statement this week that its “direct exposure to FTX exchange was confined to mid-seven figures held in custody.” The wording of the statement leaves open the question of how big the firm’s indirect exposure might be – including a portfolio of digital tokens that stood at $129 million as recently earlier this year, according to investor documents; many of those tokens, including the Solana blockchain’s SOL, were among those closely associated with Sam Bankman-Fried, the once-billionaire crypto whiz-kid-turned-pariah who ran FTX.
/jlne.ws/3Vbvgw3

As FTX collapses, Anthony Scaramucci’s SkyBridge Capital is trying to buy back the 30% stake Sam Bankman-Fried bought 2 months ago
Phil Rosen – Markets Insider
Anthony Scaramucci said his firm, SkyBridge Capital, is working toward repurchasing the 30% stake that Sam Bankman-Fried’s FTX acquired two months ago. Speaking on CNBC just hours before FTX announced it filed for bankruptcy, Scaramucci said his legal team and partners are working to buy back the stake, adding that SkyBridge is well capitalized with or without that investment. Still, he acknowledged that the fallout from FTX’s collapse has had an impact.
/jlne.ws/3UPOIP4

A top exec at OKX explains his call with Sam Bankman-Fried as FTX scrambled for a rescue – and why he couldn’t give him a billion-dollar lifeline
Phil Rosen – Insider
As specifics about FTX’s collapse continue to surface through court filings and tweetstorms, so too are details about Sam Bankman-Fried’s scramble for a rescue in the days leading up to his firm’s November 11 bankruptcy announcement. On November 6, Binance CEO Changpeng “CZ” Zhao tweeted that Binance was liquidating $531 million of FTX’s native token FTT, triggering a liquidity crisis at Bankman-Fried’s firm. To save FTX, Bankman-Fried sought emergency capital from rival crypto exchanges, including OKX, which says it’s the second-largest crypto exchange by spot trading volume.
/jlne.ws/3AwmDEs

Why One Asset Manager Avoided FTX Before the Storm: Bitwise Q&A
Michael P. Regan and Vildana Hajric – Bloomberg
The cryptocurrency industry has been rocked by the implosion of the once-popular FTX exchange, whose downfall has brought down a number of firms and maimed or destroyed many others. Investors and those even tangentially related to what’s happened in recent days are still sifting through the rubble and awaiting the next dominoes to fall.
/jlne.ws/3gkPXqD

FTX Mayhem Fails to Scare Futures Exchanges Away From Crypto; CME and Cboe are sticking to trading in crypto futures; CME’s Duffy says ‘one bad actor’ won’t change his firm’s plans
Katherine Doherty and Isis Almeida – Bloomberg
Even as some of Wall Street’s old guard has an “I-told-you-so” moment after the collapse of Sam Bankman-Fried’s FTX, futures exchanges aren’t giving up on crypto. CME Group Inc. Chief Executive Officer Terry Duffy, who has been one of Bankman-Fried’s fiercest critics, said he won’t stop crypto-futures trading just because of “one bad actor.” Cboe Global Markets, another Chicago exchange, and software provider Trading Technologies also recommitted to digital assets in the wake of the FTX meltdown.
/jlne.ws/3AtaAaQ

‘Grayscale Discount’ Widens to Record 43% as FTX Contagion Spreads
Lyllah Ledesma – CoinDesk
Shares of the Grayscale Bitcoin Trust (GBTC), the world’s largest publicly traded crypto fund, are trading at a new record discount of 43% relative to the price of the underlying bitcoin (BTC). Crypto analysts are speculating as to the reason, but the added pressure comes after Genesis Global Capital, an arm of Digital Currency Group (DCG), owner of Grayscale Investments, which manages GBTC, announced this week that it would halt customer withdrawals from its lending unit – stemming from the fallout from the collapse of Sam Bankman-Fried’s FTX crypto empire.
/jlne.ws/3hWZW5N

Sports Fan Tokens Rally Ahead of FIFA World Cup, Defying Crypto Market Gloom
Krisztian Sandor – CoinDesk
Through the doom and gloom of FTX-stricken crypto markets, sports fan tokens are basking in a fresh wave of hype ahead of the FIFA World Cup 2022, which starts Sunday. The native token of the Chiliz blockchain (CHZ), which powers the largest sports fan token creator platform Socios.com, has surged 11% in the past 24 hours. Fan tokens for the national soccer teams of Portugal (POR) and Argentina (ARG), both major contenders to win the Cup, “will be the cherries on top during the World Cup,” the research team of crypto exchange Huobi wrote in a report Thursday.
/jlne.ws/3EnTHzG

Binance has a plan to save crypto-if it’s not too late; Crypto exchanges want to prove that the market can thrive after the FTX collapse.
Joel Khalili and Morgan Meaker – Ars Technica
Few were prepared for the dramatic collapse of crypto exchange FTX on November 11. The incident has left hundreds of thousands of customers without access to their funds, and the ripple effects have wiped billions of dollars from the market, as well as casting doubt over the integrity of other crypto companies. FTX was so deeply embedded in the cryptosphere that many firms (including crypto lenders Genesis and BlockFi) have spent the last week hurriedly calculating their own financial exposure to the collapse, in fear they may be dragged down in the swell.
/jlne.ws/3ViCdeV

Binance adds to stablecoin mystery by resuming Tether deposits while keeping out USD Coin
Brian Evans – Business Insider
Binance resumed deposits of stablecoin Tether on Friday but left USD Coin on pause, according to a company announcement. That came a day after halting deposits of both coins without explanation, and the latest announcement also didn’t provide a reason for the move. Binance did not immediately respond to Insider’s request for comment.
/jlne.ws/3tNe1Wk

Sam Bankman-Fried’s crypto ‘fraud’ joins Hall of Shame with Madoff, Holmes
Charles Gasparino – NY Post
It may be a bit too early to lump Sam Bankman-Fried into the same bucket as the infamous fraudster Bernie Madoff – or maybe not. The full post-mortem of his epic collapse from crypto wunderkind and billionaire to broke crypto villain extraordinaire won’t be ready for some time. Prosecutors in the US attorney for the Southern District are eyeing possible charges before the end of the year, I am told, so barring exculpatory evidence we can’t label him a criminal yet.
/jlne.ws/3tLA1R4

FTX’s ‘chief regulatory officer’ Dan Friedberg tied to online poker scandal
Thomas Barrabi – NY Post
The top “regulatory officer” at fallen crypto exchange FTX once served as an attorney for a company that was embroiled in a notorious online poker cheating scandal more than a decade ago – and was caught on tape allegedly aiding the perpetrators of the fraud, according to reports.
/jlne.ws/3Gz1Cws

Politics

COP27 nears breakthrough on climate finance in scramble for final deal
Kate Abnett, Shadia Nasralla and Gloria Dickie – Reuters
Negotiators at the COP27 climate summit in Egypt neared a breakthrough deal on Saturday for a fund to help poor countries being ravaged by the impacts of global warming, but remained locked over how to reduce the greenhouse gas emissions driving them. With a final climate accord already more than a day overdue, representatives of nearly 200 nations were anxious for an agreement they could bill as a step forward in the fight against climate change. The outcome of the two-week summit in the resort town of Sharm el-Sheikh is a test of worldwide resolve to fight global warming, even as a war in Europe and rampant consumer inflation distract international attention.
/jlne.ws/3tNskKm

How a Flawed But Historic Climate Deal Emerged From COP Chaos; The UN climate summit just barely avoided ending in deadlock, and the final compromise left big doubts over the prospect for new efforts to curb emissions.
Jennifer A Dlouhy and John Ainger – Bloomberg
Hours after the COP27 climate talks reached the deadline, there was still no deal and the European Union’s climate chief was threatening to leave Sharm El-Sheikh without one. “We don’t want a result at any price,” Frans Timmermans told reporters, flanked by ministers from Germany, Austria, Ireland and Spain. “The EU would rather have no decision than a bad decision.”
/jlne.ws/3gqu1ug

Onetime Trump Appointee Helps Spark Sweeping ESG Backlash; Andy Puzder is a key catalyst in the Republican movement with a bevy of politicians, including former US Vice President Mike Pence.
Saijel Kishan and Jeff Green – Bloomberg
A fiery attack by former US Vice President Mike Pence. A first-of-its-kind law in Idaho that takes aim at ESG. A slew of similar bills expected to be introduced in red states next year. These anti-ESG moves all have one thing in common: Andy Puzder.
/jlne.ws/3AwU5um

Biden’s antitrust adviser warns of ‘profusion of junk fees’ in US economy; Tim Wu’s comments come as White House moves to expand crackdown on hidden costs to securities market
Stefania Palma – Financial Times
Joe Biden’s antitrust adviser has warned of a “profusion of junk fees” in the US economy, as he pushes to expand the war on hidden costs to include those affecting investors in the securities market. In an interview with the Financial Times, Tim Wu, the Biden administration’s adviser on competition policy, said there was a “sense there has been a profusion of junk fees across the economy, things that confuse people, coercive fees, deceptive practices”.
/jlne.ws/3GxuIMK

US Sen. Gillibrand Says a Last-Ditch Stablecoin Bill May Still Emerge This Year
Jesse Hamilton – CoinDesk
Sen. Kirsten Gillibrand (D-N.Y.) said the latest effort on a stablecoin regulatory bill is coming soon, and she hopes it can get some attention before Congress transitions into its new session next year. She’s working with Republican Senators Patrick Toomey (Pa.) and Cynthia Lummis (Wyo.) on “unique” legislation that will establish U.S. rules of the road for the tokens, she said Wednesday.
/jlne.ws/3VcZBu1

Biden Turns 80, Eyeing Six More Years; What’s the presidential age limit for tussling with Xi Jinping? Democrats owe the country a 2024 debate.
The Wall Street Journal
As he turns 80 years old on Sunday, President Biden the man of Catholic faith might be reflecting on a few lines from the Psalmist. “The days of our years are threescore years and ten,” as the King James puts it, unless “by reason of strength they be fourscore years.” Fellow partakers of human frailty should give thanks for modern medicine, as well as Mr. Biden’s continued health. Yet what Mr. Biden needs to ask himself, and preferably soon, is whether two years from today he will really want “four more years,” as the crowds would chant in 2024.
/jlne.ws/3hYjWoP

Summers Warns Very Risky for US to Aim at ‘Tearing China Down’; Former Treasury chief says better to focus on building up US; Summers also says Fed now has communication in ‘right place’
Chris Anstey – Bloomberg
Former Treasury Secretary Lawrence Summers warned US policy makers to focus on building the country’s own economic strengths in its contest with China, rather than on attacking its adversary. “If we change our focus from building ourselves up to tearing China down, I think we will be making a very risky and very unfortunate choice,” Summers told Bloomberg Television’s “Wall Street Week” with David Westin. The US should instead concentrate on its own innovation, infrastructure, education and challenges such as opioid deaths, he said.
/jlne.ws/3i3vlDS

GOP’s Hawley Wants Democrats’ Emails as FTX Collapse Turns Political; GOP Senator makes request to Biden officials, campaign groups; Former FTX chief Bankman-Fried is a major donor to Democrats
Laura Davison – Bloomberg
The collapse of the crypto empire founded by political mega-donor Sam Bankman-Fried is being transformed into a new political battlefront as Republicans highlight links between Democrats and their one-time benefactor. Missouri Republican Senator Josh Hawley on Friday sent a broad request for correspondence between federal agencies and Democrats, including the Biden administration and the House and Senate Democrats’ campaign committees, regarding bankrupt crypto exchange FTX and trading house Alameda Research.
/jlne.ws/3ELsDf0

Joe Biden celebrates his 80th birthday
Maegan Vazquez – CNN
President Joe Biden turns 80 years old on Sunday, becoming the first octogenarian to ever serve in the highest office of the United States. The unique milestone of Biden’s birthday comes as the president faces speculation about whether he will mount a reelection run and dredges up questions about whether he’s too old to serve another term. The president celebrated his birthday in Washington with a brunch hosted by first lady Jill Biden, according to White House press secretary Karine Jean-Pierre. Jill Biden tweeted a photo of him blowing out a candle on top of a coconut cake, with balloons in the background.
/jlne.ws/3TUkx8d

Jones Day Lifer Takes Reins as `Trump’s Law Firm’ Enters New Era
Roy Strom and Justin Wise – Bloomberg
Greg Shumaker has a lot in common with Stephen Brogan, the man who hand-selected him to take the reins at influential law firm Jones Day. Shumaker joins an exclusive club as the firm’s next managing partner: Only eight people, including Brogan, have been tapped for the role in Jones Day’s 130-year history. Both men are Washington-based litigators who have spent decades in the nation’s capital. They’re also Jones Day lifers, and active University of Notre Dame alumni who help steer the Catholic school’s direction.
/jlne.ws/3GBIder

Sunak Wins Over the Markets. Voters Are Another Story; A recent lead in the polls has put a spring in the opposition Labour party’s step.
Martin Ivens – Bloomberg
Two short letters have become notorious in UK political history for their candor about dire state finances. Reginald Maudling, outgoing Tory chancellor in 1964, told his Labour successor and friend, Jim Callaghan, “Sorry old cock, to leave it in this shape.” In 2010, Liam Byrne, Labour’s Chief Secretary to the Treasury, also offered his Liberal Democrat successor, David Laws, a mock apology: “I’m afraid, there is no money.”
/jlne.ws/3OkNCIN

EU wrestles with Payment for Order Flow share trading rules
Huw Jones – Reuters
European Union states edged closer on Thursday to ditching a proposed ban on brokers earning fees in return for directing stock trades to specific trading platforms. Payment for order flow (PFOF) drew scrutiny last year when an army of retail investors flocked to ‘meme stocks’ on Wall Street, using brokers who touted for business by charging zero fees, making money by sending the orders to an agreed venue for execution. The United States is considering whether curbs are needed for PFOF while the UK has already banned it.
/jlne.ws/3OlD9wK

Meet the Fertilizer Tycoon at Core of Kremlin Grain Talks; Dmitry Mazepin has been hit hard by the aftermath of the war; Russia wants reopened ammonia pipeline to renew grain deal
Bloomberg
Russian tycoon Dmitry Mazepin may be better known internationally as the father of former Formula-1 driver Nikita, who was dropped from the American Haas F1 Team after Russia invaded Ukraine. But now, it’s the fertilizer empire he founded that’s in the spotlight.
/jlne.ws/3V171RG

Global LNG Supplies Are ‘Sold Out’ for Years, Top Importer Warns; No long-term contracts available before 2026, says Japan; This is set to intensify worldwide competition for the fuel
Shoko Oda – Bloomberg
Japan warns that global competition for liquefied natural gas is set to intensify over the next three years due to an underinvestment in supply. Long-term LNG contracts that start before 2026 are sold out, according to a survey of Japanese companies conducted by the trade ministry and released Monday. These types of contracts are essential for buyers, as they offer stable pricing and reliable supply for many years.
/jlne.ws/3hWSEis

Regulation

China’s securities regulator moves to streamline debt issuance
Reuters
China’s securities regulator on Friday released draft rules on deepening a registration-based system for bond sales, in a reform that streamlines the process for companies to raise funds via debt issuance, according to a statement. The China Securities Regulatory Commission also said in the draft that it would support reasonable bond financing needs for property firms, as part of regulators’ efforts to address the liquidity crisis faced by developers.
/jlne.ws/3AxwycQ

FTX’s Fight With Bahamas Puts Customers’ Crypto in Limbo; Liquidators in the Bahamas are embroiled in a dispute with FTX over who has control over crypto assets held in the country
Alexander Saeedy and Soma Biswas – The Wall Street Journal
The collapse of FTX has put its new management at odds with regulators in the Bahamas over who should control billions in sparsely documented cash and cryptocurrency assets that are presently out of customers’ reach. The Securities Commission of the Bahamas last week installed liquidators at the exchange’s Bahamas-based unit FTX Digital Markets Ltd. to recover its assets and deposits from other FTX entities after they ruled it was insolvent.
/jlne.ws/3UVxdwW

Crypto should be regulated with existing law, says former FDIC head; Sheila Bair says collapse of FTX shows danger of US agencies waiting for legislation to protect investors
Brooke Masters – Financial Times
The collapse of the cryptocurrency exchange FTX shows that US regulators must combine forces and use existing powers to protect investors rather than wait for new laws, urged Sheila Bair, who helped lead the regulatory response to the 2008 financial crisis. “The regulators need to swallow hard and get an agreement and then start implementing, using the authorities they have now,” Bair, formerly head of the Federal Deposit Insurance Corporation, told the Financial Times.
/jlne.ws/3Gvw5f5

Ohio man charged with $10 million cryptocurrency fraud scheme; The defendant allegedly has a history of duping investors, DOJ says.
Luke Barr – ABC News
An Ohio man who was previously known to the federal government for allegedly defrauding investors, was charged by the Justice Department with defrauding investors of another $10 million dollars. Rathnakishore Giri, a 27-year-old from New Albany, Ohio, has a history of investment fraud, the Justice Department alleged, and this scheme they say was no different. Giri allegedly promised investors he could secure returns by investing their money in cryptocurrency, when in reality, DOJ says he couldn’t. He “fraudulently” promoted himself as an expert in cryptocurrency, according to the DOJ.
/jlne.ws/3gkwy96

US Court Approves Deadline for Celsius Customers to File Proofs of Claim
Sandali Handagama – CoinDesk
A U.S. court has approved collapsed crypto lender Celsius’ request to set a deadline for customers to file proofs of claim in the ongoing bankruptcy proceedings. Celsius’ motion, approved by U.S. Bankruptcy Court of the Southern District of New York last week, requires customers to submit proofs of claim on or before Jan. 3, 2023. Any person or entity – including individuals, partnerships, corporations, joint ventures and trusts – are free to file a claim via mail, by hand or through the claims agent Stretto’s website.
/jlne.ws/3EM8p4O

UK regulators call for action on hidden leverage threat to pension funds; Policymakers say more must be done to address blind spot revealed by September’s gilt crisis
Chris Flood and Josephine Cumbo – Financial Times
Regulators and policymakers are calling for action to address the risks associated with pension funds’ use of derivatives, after key watchdogs admitted last week that they were unprepared for the crisis that hit the industry in September. The meltdown, now the focus of four separate parliamentary probes, revealed regulators did not have a reliable picture of the scale of hidden leverage in liability-driven investment (LDI) strategies, which cover about £1.4tn of the future promises made by UK defined benefit pension schemes.
/jlne.ws/3GvmDs9

Crypto should be regulated with existing law, says former FDIC head; Sheila Bair says collapse of FTX shows danger of US agencies waiting for legislation to protect investors
Brooke Masters – Financial Times
The collapse of the cryptocurrency exchange FTX shows that US regulators must combine forces and use existing powers to protect investors rather than wait for new laws, urged Sheila Bair, who helped lead the regulatory response to the 2008 financial crisis. “The regulators need to swallow hard and get an agreement and then start implementing, using the authorities they have now,” Bair, formerly head of the Federal Deposit Insurance Corporation, told the Financial Times.
/jlne.ws/3Gvw5f5

S.Korea examines exchange native tokens after FTX meltdown
Danny Park – Forkast
South Korean financial authorities are looking into self-issued cryptocurrencies that may exist within local crypto exchanges following FTX.com’s FTT-led liquidity crisis. South Korea’s Financial Intelligence Unit (KoFIU) has confirmed with Forkast that they sent exchanges a request for cooperation and is examining their records of self-issued exchange tokens, which is reportedly a response to FTX Token (FTT) being the center of FTX’s liquidity crunch, which ultimately led to the exchange falling apart.
/jlne.ws/3giP3Lj

SEC Seeks to Stop the Registration of Misleading Crypto Asset Offerings
SEC
The Securities and Exchange Commission today instituted administrative proceedings against American CryptoFed DAO LLC (American CryptoFed), a Wyoming-based organization, to determine whether a stop order should be issued to suspend the registration of the offer and sale of two crypto assets, the Ducat token and the Locke token.
/jlne.ws/3hZMsq0

An SEC Rule May Cost FTX Crypto Customers Billions; A March decree prevented banks and broker-dealers from custodying assets, leaving investors open to greater risk.
Hal Scott and John Gulliver – The Wall Street Journal
After the crypto exchange FTX filed for bankruptcy last week, Securities and Exchange Commission Chairman Gary Gensler announced that he will crack down on the “wild west” of crypto markets. Meanwhile, Reuters reported that between $1 billion and $2 billion in customer funds held by FTX had disappeared. If U.S. customers lose their shirts, the SEC will bear significant responsibility. FTX’s bankruptcy was caused by significant losses from previously unknown exposures to volatile crypto assets and the potential misuse of customer funds lent to Alameda Research, an affiliated trading firm.
/jlne.ws/3UVGKUB

Interim stop orders placed on MPG Funds Management Limited’s property trusts
ASIC
ASIC has made interim stop orders preventing MPG Funds Management Limited (MPG) from offering or distributing two trusts to retail investors because of deficient target market determinations (TMDs).
/jlne.ws/3OoxqWQ

FCA issues Final Notice to former CEO for anti-money laundering failings
FCA
The Financial Conduct Authority has publicly censured Mohammad Ataur Rahman Prodhan, the former Chief Executive Officer of Sonali Bank (UK) Limited (SBUK) for anti-money laundering (AML) failings.
/jlne.ws/3TOtrnx

MAS Statement to Address Misconceptions in the Wake of Collapse of FTX
Monetary Authority of Singapore (MAS)
The Monetary Authority of Singapore (MAS) would like to address some questions and misconceptions that have arisen in the wake of the FTX.com (FTX) debacle.
/jlne.ws/3gr5zJ9

Investing and Trading

Beyond the Crypto Crash, a Big Squeeze Jolts Stock Markets Anew; Hedge funds cover short wagers at the fastest rate since 2021; Thinly positioned investors play catch-up via call options
Lu Wang and Isabelle Lee – Bloomberg
Being glued to crypto news this week meant missing adventures in regular markets that while lacking the same high drama, made up for it in terms of money at stake. In case you missed it, stock and bond traders spent the last five days still caught in the thrall of an event that may be hard to recall for people mesmerized by the FTX.com collapse: Nov. 10’s inflation report, which ignited a short squeeze among traders expecting a worse number. Reverberations continued to be felt in terms of positioning, trading in derivatives and probably also in wrongly prepared portfolios.
/jlne.ws/3ENSrXK

Warren Buffett’s Berkshire warns about crypto website using its name
Reuters
Berkshire Hathaway Inc (BRKa.N), run by billionaire Warren Buffett, on Friday warned investors it has no affiliation with a purported cryptocurrency brokerage website using the Berkshire Hathaway name. The website describes its operator as a Texas-based broker founded in 2020 to give investors “an opportunity to achieve a completely passive income from investment in cryptocurrency mining.” It includes purported customer testimonials and says the broker is regulated in the United States, United Kingdom, Cyprus and South Africa, using incorrect names for two regulators. Its email format differs from that of Buffett’s company.
/jlne.ws/3TN4wRq

GameStop’s Ryan Cohen Wants to Be More Than a Meme-Stock King
Miriam Gottfried and Caitlin McCabe – The Wall Street Journal
Ryan Cohen is the face of an investing revolution that captivated amateur traders, punished Wall Street and favored memes over fundamentals. Many of his other bets belong to a more conservative playbook. The 37-year-old billionaire, who made his fortune with online pet retailer Chewy Inc., gained fame during a period of market frenzy last year when he used a stake in struggling videogame retailer GameStop Inc. to push out the executive team and become chairman. His enigmatic tweets-including a picture of himself with chopsticks up his nose-helped his investment gain viral popularity as a so-called meme stock and motivated his followers to seek revenge against professional traders who had bet against the company.
/jlne.ws/3i1VF0P

Grindr’s Stock More Than Doubles in Debut After SPAC Deal
Bailey Lipschultz
Grindr LLC, the dating app that specializes in connections for the LGBTQ+ community, became the latest stock to see an eye-popping surge after completing a SPAC tie-up as traders flip shares of the low-float company. Shares of the company, which went public by merging with Tiga Acquistion Corp., spiked 214% from the price that Tiga closed at on Thursday. The rally came after roughly 98% of investors opted to redeem their stake when they voted to approve the deal, meaning less than 500,000 shares remained outstanding.
/jlne.ws/3EMgFSq

BMO Investment Chief Says Big Markdown Is Coming in Private Assets; PE firms can’t deny reality with stocks way down, CIO says; KKR, Carlyle and other firms have reported sliding earnings
Layan Odeh – Bloomberg
Private equity firms and pension funds will soon face a reckoning as they adjust their private holdings to reflect lower valuations, according to the chief investment officer of BMO Global Asset Management. There’s “going to be a big markdown,” Sadiq Adatia said in an interview. “That might be worse than getting that pain gradually over the year.” Stocks are on pace for their worst year since 2008, with major benchmarks such as the S&P 500 and the MSCI ACWI Index down between 15% and 20%. Published returns from some pension plans and sovereign-wealth funds suggest that private equity returns have fared better than public equities.
/jlne.ws/3UVmySH

GameStop’s HODLers Keep Hanging On; Chairman Ryan Cohen’s ‘Oz-like’ quality has helped minimize losses in the video-game seller’s stock.
Bailey Lipschultz – Bloomberg
It’s been a rough year: Global markets have lost trillions of dollars in value, and consumers are being pinched by inflation. In the face of it all, some meme-stock die-hards remain undeterred. Individuals who bought GameStop Corp. early in the frenzy are still sitting on massive paper returns that outshine those of other speculative investments. Since the end of 2020, the video game retailer’s stock was up 501% as of Oct. 31, compared with the 3% rise for the benchmark S&P 500 and the 26% drop in a basket of 37 meme stocks tracked by Bloomberg.
/jlne.ws/3GvmZ1V

I Tried Talking to My Parents About Estate Planning. The Chicago Bears Game Was a Problem.
Debbie Carlson – Barron’s
Ten years ago, I tried to talk to my parents about estate planning, and the conversation lasted about a minute, with my mom saying it was taken care of, and wouldn’t elaborate on what “it” was. My halfhearted attempts since then went nowhere, but this year I knew I had to get beyond my parents’ reticence to talk. While both my mom, 84-year-old Wilhelmina Gorworowski and stepfather, 89-year-old Gene Gorworowski, are in relatively good health for their ages, my mom fell and injured her hip this fall. She is on the mend, but it was a sign that I couldn’t wait to have this delicate conversation.
/jlne.ws/3i13u79

Ohio Investment Manager Arrested for Allegedly Running a $10M Cryptocurrency Ponzi Scheme
Nelson Wang – CoinDesk
Rathnakishore Giri, a 27-year-old investment manager living in New Albany, Ohio, was arrested on Friday on criminal charges for alleging running a cryptocurrency investment scam that raised at least $10 million from investors, according to a Department of Justice press release. Giri allegedly misled investor by promoting himself as an expert cryptocurrency trader with a specialty in bitcoin derivatives. According to the indictment, Giri falsely promised investors lucrative returns on the money they invested with him, with no risk to principal. In reality, he used funds from previous investors to pay off new investors in a classic Ponzi scheme set-up.
/jlne.ws/3tP43Um

Environmental, Social and Corporate Governance

Inside the Billion-Dollar Market for Junk Carbon Offsets; An examination of the sellers, verifiers and buyers of a popular climate solution tied to renewable energy. Experts say it might end up actually increasing emissions
Akshat Rathi – Bloomberg
Rising acceptance that the world needs to cut carbon emissions fast has coincided with a parallel rise in ineffective solutions to the problem. There’s now real danger that tools meant to slow global warming may end up allowing more emissions. A prime example of that risk is carbon offsets. These promissory notes offer buyers an accounting power: Emitters of planet-warming pollution get to deduct emissions from their own their own ledgers simply by purchasing tons of carbon offsets sourced to projects elsewhere. That’s a particularly attractive power to the thousands of corporations now setting net-zero plans.
/jlne.ws/3AAb8M9

Director Darren Aronofsky on How Art Can Fuel the Climate Fight; The executive producer of Limitless, with Chris Hemsworth says that climate storytelling requires an upbeat view.
Bloomberg News
“Unfortunately, a lot of people are depressed and are only seeing a future filled with doom and gloom. So, as a storyteller now, it’s super important to turn to stories that are not about dystopia, but are about protopia, and the possibility of the great things that can be.” Science can play a powerful role in filmmaking and other art, says Darren Aronofsky, but it’s secondary to the storytelling that keeps us watching. He is an executive producer of Limitless with Chris Hemsworth, which turns the science of longevity and health into intense documentary adventure.- As told to Eric Roston
/jlne.ws/3XnhMz2

World still ‘on brink of climate catastrophe’ after Cop27 deal
Experts say biggest economies must pledge more cuts to carbon emissions but hail agreement to set up loss and damage fund; A deal on loss and damage, but a blow to 1.5C – what will be Cop27’s legacy?
Fiona Harvey – The Guardian
The world still stands “on the brink of climate catastrophe” after the deal reached at the Cop27 UN climate summit on Sunday, and the biggest economies must make fresh commitments to cut greenhouse gas emissions, climate experts and campaigners have warned. The agreement reached in Sharm el-Sheikh early on Sunday morning, after a marathon final negotiating session that ran 40 hours beyond its deadline, was hailed for providing poor countries for the first time with financial assistance known as loss and damage. A fund will be set up by rich governments for the rescue and rebuilding of vulnerable areas stricken by climate disaster, a key demand of developing nations for the last 30 years of climate talks.
/jlne.ws/3tOoqAW

ESMA Launches A Consultation On Guidelines For The Use Of ESG Or Sustainability-Related Terms In Funds’ Names
Mondo Visione
The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, is seeking input on draft guidelines on the use in funds’ names of ESG or sustainability-related terms. Funds’ names are a powerful marketing tool. In order not to mislead investors, ESMA believes that ESG- and sustainability-related terms in funds’ names should be supported in a material way by evidence of sustainability characteristics or objectives that are reflected fairly and consistently in the fund’s investment objectives and policy. ESMA is particularly seeking stakeholders’ feedback on the introduction of quantitative thresholds for the minimum proportion of investments sufficient to support the ESG or sustainability-related terms in funds’ names.
/jlne.ws/3UWrerw

UN climate summit ends in discord after agreeing help for poor nations; Jubilation over set-up of loss and damage support tempered by row over emissions goals
Camilla Hodgson and Emiliya Mychasuk – Financial Times
Poor countries suffering from the effects of climate change will get financial help from richer nations under a historic agreement by the UN on Sunday. But the talks ended in discord after negotiators failed to reach a deal on greater cuts to greenhouse gas emissions and an end to fossil fuel use. In fraught negotiations which over-ran their Friday deadline and took until Sunday morning to complete, almost 200 countries agreed to set up a fund to cover the “loss and damage” that “particularly vulnerable” nations are suffering from climate change.
/jlne.ws/3UUadhP

Onetime Trump Appointee Helps Spark Sweeping ESG Backlash; Andy Puzder is a key catalyst in the Republican movement with a bevy of politicians, including former US Vice President Mike Pence.
Saijel Kishan and Jeff Green – Bloomberg
A fiery attack by former US Vice President Mike Pence. A first-of-its-kind law in Idaho that takes aim at ESG. A slew of similar bills expected to be introduced in red states next year. These anti-ESG moves all have one thing in common: Andy Puzder. A critic of minimum-wage laws, paid sick leave and other regulations, the fast-food magnate has emerged as a central figure in motivating an ambitious network of like-minded conservatives across red America in the war against ESG.
/jlne.ws/3UUOypL

Michael Bloomberg, ESG Advocate – and China Apologist
Andrew Stuttaford – National Review
Michael Bloomberg is a prominent advocate of ESG, an investment discipline that incorporates measuring actual or prospective companies against various environmental, social, and governance standards. Not so long ago, in response to an article Bloomberg had written in which he claimed that ESG was “investing 101” I commented that “in reality, [it was] an Orwellian 2 + 2 = 5.”
/jlne.ws/3Ep0UPO

The Bahamas Wants Money to Protect Its Oceans; The Bahamas is one of the world’s largest carbon sinks, “and we think it’s time for us to be paid for it,” Prime Minister Philip Davis says on Episode 11 of Zero.
Akshat Rathi, Christine Driscoll, and Oscar Boyd – Bloomberg
Three years after a Category 5 hurricane caused billions of dollars in damage in The Bahamas, Prime Minister Philip Davis warned that the increasing frequency of such storms has grave implications for how Bahamaians live. As COP27 kicked off in Egypt this week, that warning gave way to a demand: Show us the money.
/jlne.ws/3Vas3gN

Utilities, Natural Gas Will Play Key Roles in Green Energy Shift: Duke CFO; Brian Savoy says power companies will use the fossil fuel as a bridge, while moving toward decarbonization.
Alix Steel – Bloomberg
The shift to cleaner energy is happening globally. How important a player in that transition will power and utility companies like Duke be? It’s an amazing time to be in this role in this moment, because our sector is decarbonizing and it’s the enabler to decarbonize every other sector, like transportation or the building sector. So the pressure’s on-and we’re up to it.
/jlne.ws/3EhEJLq

How the 2022 World Cup Rebuilt a Market for Dodgy Carbon Credits; The global tournament has given a boost to a new Qatari organization that validates carbon offsets others won’t.
Natasha White and Verity Ratcliffe – Bloomberg
For almost a decade, the small, gas-rich country of Qatar has been one giant construction site. In preparation to host the FIFA World Cup this November, it’s built seven stadiums, new roads and dozens of hotels. Between the emissions generated by the new construction plus air travel to transport players and fans, the 2022 tournament is shaping up to be the most carbon-intensive on record. World Cup organizers have pledged to erase the event’s negative environmental impact. They plan to make the event “carbon neutral” by buying offsets – paying, in theory, for carbon to be removed or reduced from the Earth’s atmosphere somewhere else.
/jlne.ws/3ELtIU6

Trust Exchange and EpiCentric Consulting Launch ESG Joint Venture; Trust Exchange and their partner EpiCentric have announced a joint venture, EcoCertify, to help companies manage ESG compliance.
Globe Newswire via Yahoo
Trust Exchange, a collaborative compliance platform, today announced that it is launching a new product with partner EpiCentric Consulting to offer an ESG-compliance solution. EcoCertify is a cloud-based platform that powers a business to connect suppliers and their entire supply chain network, affording remarkable transparency, and the ability to create clear, real-time communication of ESG requirements and capabilities throughout their ecosystem. It can be customized to fit most any workflow to dramatically streamline the process of monitoring, real-time reporting, and tracking.
/jlne.ws/3EQxJ9Z

Institutions

Wall Street Banks Seen as Unlikely Saviors as Crypto Firms Struggle
Helene Braun – CoinDesk
It took years for the crypto industry to gain trust – and capital – from the major institutional players on Wall Street. And just as more big traditional players seemed on the cusp of making a move into fast-growing blockchain markets, the messy collapse of Sam Bankman-Fried’s crypto empire has renewed comparisons of the digital-asset industry to the Wild West. As the Welsh poet Robert Williams said, “Trust is the easiest thing in the world to lose, and the hardest thing in the world to get back.” But one question now is whether big banks might see the crypto industry’s latest troubles as an attractive opportunity to nose into blockchain-based markets.
/jlne.ws/3TRPTwg

Americans Cash In Strong Dollars to Scoop Up Luxury London Homes; US buyers make up the bulk of buyers of prime London property; One agent says five of last six sales were to American buyers
Damian Shepherd – Bloomberg
London real estate broker Charles McDowell has sold six luxury central London homes in the last six months. Five of the buyers were American. The broker’s recent sales involve homes in affluent areas including Holland Park, Notting Hill and Chelsea. Three of the properties sold for over £25 million ($29.4 million), while another nearly hit the £50 million mark. At least half of the sellers were British, he said.
/jlne.ws/3hYoxHA

BofA downgrades Coinbase, says it faces ‘a number of new headwinds’ after FTX debacle
Myles Udland – Yahoo!Finance
Analysts at Bank of America downgraded shares of Coinbase (COIN) on Friday as the fallout from FTX’s stunning implosion continues to ripple through crypto markets. Shares of Coinbase were down as much as 5.5% in early trading on Friday. “We think Coinbase (COIN) likely faces a number of new headwinds over the near/medium-term due to the recent collapse of rival crypto exchange FTX,” analysts led by Jason Kupferberg wrote in a note to clients.
/jlne.ws/3tLRlFL

Ex-Bundesbank Chief Weidmann Proposed as Next Commerzbank Chair
William Wilkes – Bloomberg
Commerzbank AG proposed former Bundesbank President Jens Weidmann as its next supervisory board chairman, a move that would place one of the country’s foremost economists at the top one of its largest banks. Helmut Gottschalk has decided against another term as chairman, when his current one expires at the company’s annual general meeting in May 2023, the German lender said Saturday in a statement. Weidmann’s candidacy will be put to a vote at the bank’s AGM.
/jlne.ws/3EOdoC5

Buffett’s Berkshire Ups Stakes in Japanese Trading Houses; Trading companies’ shares rise on filings to finance ministry; Buffett first purchased stakes in ‘sogo shosha’ in Aug. 2020
Shoko Oda – Bloomberg
Warren Buffett’s Berkshire Hathaway Inc. increased its stakes in five of Japan’s major trading companies, according to filings released on Monday. Berkshire Hathaway first bought stakes in Japan’s trading houses — also known as “sogo shosha” — in August 2020, acquiring about 5% of each of the firms. The trading companies, which invest in oil and natural gas projects globally, have booked stellar earnings in the most recent quarter fueled by the boom in commodities. Mitsui announced a 140 billion yen ($1 billion) stock buyback earlier this month on the back of a jump in earnings from higher energy prices.
/jlne.ws/3i13X9p

Wellness Exchange

1 Illinois County Rises to ‘High’ COVID Alert Level Under CDC Guidelines
NBC Chicago
One Illinois county has risen to a “high” COVID alert level this week, sparking new masking guidelines and marking a shift after the state had no counties at such a level last week. Winnebago County, just outside the Chicago area along the Illinois-Wisconsin border, was listed at a “high” community level for COVID by the Centers for Disease Control and Prevention. At a “high” alert level, masking is recommended for all in indoor public spaces. More than a dozen other counties in Illinois were listed at a “medium” level, meaning those at high risk of illness are urged to wear masks in public indoor spaces.
/jlne.ws/3XgM6eK

Flu, RSV and Covid-19 Add to Crunch on Pediatric Hospitals; Emergency departments are strained and staff are scarce. ‘It’s one after the other after the other.’
Brianna Abbott – The Wall Street Journal
Flu activity continued to rise across the U.S. in the past week, adding to a crunch on emergency departments and pediatric hospitals from an early surge in respiratory viruses. Flu has caused an estimated 4.4 million illnesses, 38,000 hospitalizations and 2,100 deaths so far this season including seven pediatric deaths, the Centers for Disease Control and Prevention said Friday. The highest flu hospitalization rates are among adults ages 65 and older, followed by children under the age of 5, the CDC said.
/jlne.ws/3EPjnqa

Vaccine Breakthrough Could Finally Bring COVID to Its Knees
David Axe – The Daily Beast
With new COVID variants and subvariants evolving faster and faster, each chipping away at the effectiveness of the leading vaccines, the hunt is on for a new kind of vaccine-one that works equally well on current and future forms of the novel coronavirus. Now researchers at the National Institutes of Health in Maryland think they’ve found a new approach to vaccine design that could lead them to a long-lasting jab. As a bonus, it also might work on other coronaviruses, not just the SARS-CoV-2 virus that causes COVID-19.
/jlne.ws/3tMZV76

How monoclonal antibodies lost the fight with new COVID variants
Pien Huang – NPR
Monoclonal antibodies were once the star of COVID-19 outpatient treatments. Since they first became available in 2020 – even before the first vaccines – more than 3.5 million infusions of the factory-grown proteins have been given to patients in the U.S. to help reduce risk of hospitalization. But one by one, different monoclonal treatments have lost their efficacy against new variants of the coronavirus. The rise of Paxlovid antiviral pills earlier this year, further dented their appeal.
/jlne.ws/3XmYBFu

Hong Kong leader tests positive for Covid after meeting Xi Jinping; Chinese president was not wearing mask at dinner with John Lee
Primrose Riordan, Ryan McMorrow and Tom Mitchell – Financial Times
Hong Kong’s chief executive has tested positive for Covid-19 just days after interacting with his boss, President Xi Jinping of China, at the Asia Pacific Economic Cooperation forum in Bangkok. John Lee was seated next to Xi during a meeting on November 18 and also stood next to him at an event on November 17, potentially one of Xi’s closest known brushes with the virus since the start of the pandemic.
/jlne.ws/3GyOJCz

Regions

Qatar’s Beer Ban Won’t Affect Fans in Pricey Private Suites
Lisa Fleisher – Bloomberg
Fans who’ve shelled out thousands of dollars for private hospitality suites will be unaffected by Qatar’s move to ban beer sales within stadium grounds. The tightening of rules on where ticket-holders can drink beer brings another level of inequality to the games. The decision will likely result in moving concession stands serving alcohol even further away from the stadiums.
/jlne.ws/3TS9PPE

Singapore Defends Itself Against Binance Stance Post FTX Fallout
Suvashree Ghosh and Chanyaporn Chanjaroen – Bloomberg
The Monetary Authority of Singapore defended its stance on Binance.com and collapsed crypto exchange FTX, following criticisms about the differing treatment of the two firms since the regulator had previously alerted the public to Binance.com.
/jlne.ws/3USQXRV

Three More Countries at Risk of Currency Crisis in 2023, Nomura Says
Low De Wei – Bloomberg
The Czech Republic, Romania and Hungary face the risk of exchange-rate crises over the next one year as fiscal and external challenges mount, according to Nomura Holdings Inc. The warning is based on analysis of eight indicators including FX reserves import cover, real short-term interest rates, as well as fiscal and current account measures, according to Nomura’s Damocles Index which assessed 32 emerging markets’ vulnerability to a currency crisis.
/jlne.ws/3VgtucS

Colombia signals rethink on pledge to curb oil and gas exploration; Finance minister says government will review existing contracts before deciding whether to halt new projects
Joe Parkin Daniels – Financial Times
Colombia’s leftist government has signalled it could row back on its pledge to halt new oil and gas exploration projects, saying it would first examine existing contracts as part of an overhaul of its fossil fuel industry. Gustavo Petro, a former guerrilla fighter who took office as president in August, made the promise during his election campaign. But finance minister José Antonio Ocampo said in an interview that the government would analyse the 180 contracts before deciding whether to fulfil the pledge.
/jlne.ws/3tONoQy

US Oil Futures Point to Oversupply for First Time This Year; US crude’s prompt spread trades in bearish contango structure; Demand worries weigh on futures, options could deepen selling
Devika Krishna Kumar and Alex Longley – Bloomberg
The US crude market’s structure is signaling oversupply for the first time in almost a year, the latest indicator of the scale of the dramatic slump in the nearest section of the oil futures market. The front-month spread, which reflects short-term supply-demand balances, traded in contango — the industry term for the bearish market structure — ahead of the December contract’s expiry on Monday. One other subsequent spread also flipped to contango. The rest remain in the opposite bullish structure, known as backwardation, indicating the move could yet be a short-term one.
/jlne.ws/3V6GZMw

In crises, officials tweet crucial info. What if Twitter dies?
Reis Thebault, Brianna Sacks and Mark Berman – The Washington Post
Kate Hutton was watching a Dodgers game one Friday night when she saw something strange in the outfield: The foul poles swayed, her TV feed trembled. The city emergency management coordinator knew immediately what was afoot, and she knew L.A.’s 4 million residents would have questions. So she tweeted. Within 10 minutes, Hutton had fired off three posts from the official Los Angeles Emergency Management Department Twitter account, confirming the 7.1 magnitude quake and reminding people how to prepare.
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The Biggest Copper Mine in the US Stalled in Dispute Over Sacred Ground; Rio Tinto’s Resolution project has enough of the metal for 275 million EVs. Some locals say it should never be developed.
Joe Deaux – Bloomberg
Deep beneath the arroyos and canyons of the Sonoran Desert lies one of the Earth’s biggest deposits of copper-18 million metric tons, enough of the indispensable metal to supply more than half the electric vehicles expected to be produced in the US in the coming decades. But the scrubby, arid land above that reserve is the site of the Apache Nation’s Sunrise Ceremony, a four-day rite in which young women dance and sing to mark their coming of age. “It’s been a part of us since creation,” says Wendsler Nosie Sr., an Apache leader who opposes efforts to extract the copper.
/jlne.ws/3GCl8Iy

Diesel Squeeze Is Next Energy Hurdle for White House; With winter finally gusting into the Northeast, US stocks of the fuel are low.
Liam Denning – Bloomberg
Having seemingly dodged a bullet over gasoline prices in the midterms, Democrats’ next energy hurdle concerns diesel. With winter finally gusting into the Northeast, US stocks of the fuel are low, representing just 26 days’ worth of trailing demand (the 10-year average is 35). Hysteria about spigots running dry by Thanksgiving should be tempered by the fact that those 26 days only really mean something if the entire US oil industry were to shut down – a scenario in which we may have bigger concerns.
/jlne.ws/3EmfpE9

Soaring US Mortgage Rates Are Discouraging Americans From Moving
Jordan Yadoo – Bloomberg
Americans increasingly say they have no intention of moving in the coming year, suggesting a growing reluctance among the millions of US homeowners who locked in ultra-low mortgage rates before this year’s surge. Federal Reserve Bank of New York survey data on Monday showed respondents put a 14.4% probability of changing their primary residence, the lowest in data back to 2013. The decline risks keeping a lid on much-needed inventory and spells bad news for prospective buyers hoping for a significant drop in prices.
/jlne.ws/3EsYxf3

Miscellaneous

Food Giant Cargill Names Sikes CEO as MacLennan Takes New Role; Sikes takes the top job as MacLennan becomes executive chair; Changes comes after two consecutive years of record profits
Isis Almeida, Alfred Cang, and Tarso Veloso Ribeiro – Bloomberg
Agribusiness giant Cargill Inc. named Brian Sikes as its new chief executive officer to replace David MacLennan, who will take on a new role at America’s largest private company. Sikes, who became chief operating officer last year after running Cargill’s meat business, will take the top job on Jan. 1 and MacLennan will become executive chair, the company said on Monday. The changes comes after MacLennan, who turned the 157-year old agricultural commodities trader into a protein giant, delivered two consecutive years of record profits.
/jlne.ws/3ODHsnn

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