FTX Was an Empty Black Box All Along

Nov 17, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

Cboe Global Markets is looking smarter and smarter for having shut down its bitcoin futures contracts affiliated with the Winklevoss twins, as Genesis Trading is one of the latest firms to be caught up in the FTX fallout. The Financial Times reported “Genesis Trading has halted withdrawals at its lending unit.”

Instead, Cboe went out and bought ErisX, which had a market model that matched Cboe’s tastes better, and renamed it Cboe Digital. At the recent FIA EXPO, Cboe Digital was well represented. Cboe did a nice job of presenting the brand.

Maybe it is time to move past some of the personalities of crypto and focus on the product and what it can really do. Instead of pointing to the (elusive) billions of dollars some crypto entrepreneur is worth, focus on the value to users of the product, assuming there are some.

Why did some people invest in FTX because that other company had, or that famous person had? That is the Madoff fallacy. Do your own due diligence. Think for yourselves. Don’t be a sheep, or worse – a lemming.

Sam Bankman-Fried has resigned as CEO of FTX, but he can’t stop talking about the company. Bloomberg reports “Bankman-Fried Tells His Side of the Story of FTX Collapse in Tweets.” You would think he would have discovered the rule of holes. When you find yourself in a hole, stop digging.

I know how you love real estate news, but this one does not involve a former Chicago hedge fund manager. The Wall Street Journal covers price cuts in high end luxury homes with a story about a financial services executive who tried to sell his ranch for $30 million and has since cut it down to $11.5 million. The story is titled, “He Thought His Home Might Sell for $30 Million. Fifteen Months Later, It’s ‘The Steal of the Century.'”

If you are looking for a nice little place on the water in Boca Raton, Florida, there is a home for sale for $41.5 million on the Intercoastal waterway that is the priciest home for sale in Boca.

The memorial service for my mother, Marjorie Jane Lothian, will be on December 3 at 2 PM at the Glenview Community Church, in Glenview, IL. There will be a reception after the service. This is the church my parents joined after they married, where they raised three boys, where all three boys were married and where in the Memorial Gardens my mom’s ashes will join my father’s.

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


MSCI is hosting COP27 Recap: Key outcomes and what comes next on November 21 at 10 a.m. ET. The free virtual session will share insights, discuss key outcomes and provide context and relevance for companies and investors from COP27. Register here.~SAED

PRI in Person and Online 2022 is taking place November 30 through December 2 in Barcelona, Spain, at the Barcelona International Convention Centre, located in the ’22@,’ Barcelona’s innovation district. More than 2000 investors, policymakers and other sustainable finance stakeholders will be joined by a global audience to learn, network and collaborate on how to drive the global ESG agenda. You can learn more and register here.

The Responsible Investor USA conference will take place on December 6-7, 2022, in New York City at Convene 117, W 46th Street, New York. Speakers include Grish Narula, head of climate transition finance for ICE. This is an in-person only event. Register here.~SAED


Sponsored Content
Asia’s most dynamic derivatives exchange is now open on most Japanese National Holidays!
This year’s Fall Equinox, 23rd of September, was a historical day as it marked the start of holiday trading at Osaka Exchange (OSE) and Tokyo Commodity Exchange (TOCOM). Coming out of a global pandemic and facing a shift in consumer behavior, and facing uncertainty both geo-politically and macro-economically, the move underscores Japan Exchange Group’s ambition to be the market of choice for capital flows. The market honored this move with a very active trading participation from day one, as 592,723 lots traded. Since then, we have had two more holiday trading days and on both days roughly 500 thousand lots traded on both OSE and TOCOM.

As the first official trading days were an overall success and 70% of regular trading days ADV contributors were trading. Market participants both domestic and internationally applauded the move to offer additional trading opportunities.

In an increasingly interlaced and interdependent world, many Japanese domestic investors took advantage to hedge and transfer risk on OSE and TOCOM. 288 hours of additional trading opportunities and the successful start has led some of the remaining participants, that took a more cautious approach, to revisit their position and to start considering making the holiday market available to their clients.

24/7 trading and the increase of retail participation during the pandemic has had a positive effect on rejuvenating the average Japanese retail investor. The average retail investors opening new accounts were traditionally in their 40s and 50s. During the pandemic, the average was about 10 years younger, and we experienced a massive influx of new participants. This boost by younger, more agile but also still less affluent retail participants, calls for more flexible and more granular products.

OSE has therefore designed new micro futures as well as mini options contracts that will become the bridge for these new additional players to participate.

Improved financial literacy among retail, is also reflected by an increase in retail options participation, in order to further support our domestic and international retail brokers, we have designed Nikkei 225 mini options to maximize the pool of eligible retail investors to enter these products. Both products will go-live in May 2023.

Inflation and macro-economic paradigm-shifts also call for more efficient and elaborate fixed income hedging tools. OSE has grasped the opportunity to list STIRS futures from May 2023. As CCP as well as being the market for JGB futures, this move will provide unprecedented margin efficiency and market access to the Japanese and global fixed income space.

Author: Matthias Rietig, Senior Officer of OSE

Contact: Osaka Exchange / Tokyo Commodity Exchange Derivatives Business Development

E-mail: ose-dmg@jpx.co.jp


MWE SHORT: Morgan Slade – Quant Trading and Superpowers

In this video from MarketsWiki Education’s World of Opportunity event in New York, Morgan Slade, CEO of CloudQuant, discusses the difficulties most people face when trying to enter high finance. Getting your foot in the door at a large hedge fund is tough these days unless you went to an Ivy League school and graduated summa cum laude. CloudQuant is changing the game by offering institutional quality research with high frequency data for anyone, regardless of background, to apply to algorithmic trading.

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Fallen Crypto Billionaire Admits His Persona Was a Sham in New Interview
Noah Kirsch – The Daily Beast
If there were lingering doubts about Sam Bankman-Fried’s strategic thinking-assuming one could overlook the bankruptcy filing, the bizarre tweets, and the billions of dollars in missing customer assets-those doubts surely evaporated after midnight on Wednesday, when the fallen billionaire chose to DM with a reporter at Vox to discuss his imperiled crypto exchange FTX, delivering answers with a level of candor that would make many attorneys retch.

****** Candor is an amazing thing, but proving what a good liar you are has never worked for me. I don’t know where the lies stop and the candor begins.~JJL


Taylor Swift resale ticket prices soar past $28,000 amid fan frenzy
Lisa Richwine – Reuters
Ticket resellers were trying to fetch as much as $28,000 per ticket on Wednesday for Taylor Swift’s upcoming U.S. stadium tour as fans flocked online for a second day looking to score seats to see the “Anti-Hero” singer live.

**** Maybe if it was for a tour of Jimi Hendrix, Janice Joplin and Jim Morrison I could see it. ~JB
**** A friend of my daughter Kat’s snagged two tickets for the Pittsburgh concert and is taking her to the concert.~JJL


Crypto Exchange Gemini Suffers $485M Rush of Outflows Amid Contagion Fears
Krisztian Sandor – CoinDesk
Gemini, a crypto exchange and custodian founded by the Winklevoss brothers, has suffered a rush of withdrawals as crypto firms wrestle with the reverberations of the FTX-Alameda bankruptcy and subsequent contagion within the digital asset industry.

****** This is nothing to Winklevoss at.~JJL


Tom Brady, Gisele Bundchen, and Steph Curry among celebs sued over FTX ‘Ponzi scheme’
Jeff John Roberts – Fortune
A number of high-profile celebrities, including comedian Larry David and tennis star Naomi Osaka, are suffering a hit to their reputations after endorsing the bankrupt crypto exchange FTX. Now, their pocketbooks also could take a hit. On Wednesday, Oklahoma man Edwin Garrison filed a class action lawsuit on behalf of FTX users, describing the company as a “Ponzi scheme” and saying the celebrities had endorsed unlicensed securities. In addition to FTX, other defendants in the suit include NFL star Tom Brady and his supermodel ex-wife Gisele Bundchen, NBA legends Steph Curry and Shaquille O’Neil, MLB’s David Ortiz and Shohei Ohtani, and the Golden State Warriors.

****** Celebrity endorsements are becoming very expensive for the celebrities.~JJL
****** Variety also has a story about this titled “Larry David, Tom Brady, Stephen Curry, Other Celebs Sued Over FTX Crypto Exchange Collapse.”~JJL


FTX Employees Were Encouraged to Keep Life Savings in the Now-Bankrupt Exchange, Sources Say
Cheyenne Ligon – CoinDesk
Retail and institutional investors weren’t the only ones to get rug pulled by FTX’s swift and stunning collapse last week. In addition to losing their jobs at the now-bankrupt exchange, many of FTX’s employees also appear to have significant amounts of personal wealth locked in the platform – wealth that is likely gone after being sucked into the black hole of the FTX disaster.

***** This was a huge red flag and the thing that pisses me off the most from an employee standpoint. Even smart people who knew better had to play along and, like MF Global employees, they lost it all.


Wednesday’s Top Three
Our top story Wednesday overwhelmingly was FTX Came Dangerously Close to Upending Futures Markets, from Bloomberg. Second was FTX’s Collapse Leaves Employees Sick With Anger, from The Wall Street Journal. Third was John’s picture of Pork Belly and the Outtrades playing at the gala dinner at FIA EXPO in support of the Greater Chicago Food Depository.


MarketsWiki Stats
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MarketsWiki Statistics


Lead Stories

FTX Was an Empty Black Box All Along; Sam Bankman-Fried made crypto charming-and only now is the frightening scope of this fiasco becoming clear for everyday investors.
Olga Kharif, Yueqi Yang, and Hannah Miller – Bloomberg
The epic unraveling of cryptocurrency exchange FTX.com has delivered many shocks: The $8 billion in liabilities it couldn’t pay, its huge exposure to its own magic-bean digital tokens, the apparent misuse of customer funds and the mysterious unauthorized withdrawal that drained off a chunk of the money that remained. Even so, it could have been a lot worse: Founder Sam Bankman-Fried had been trying to expand beyond crypto enthusiasts to capture the assets of everyday savers and investors in stocks and funds. The music stopped before he could get there.

Australian stock exchange apologises for dropping botched blockchain upgrade; Pioneering project’s failure threatens to leave country behind UK and EU, critics say
Nic Fildes – Financial Times
Australia’s stock exchange has apologised for abandoning a years-long plan to upgrade its clearing and settlement system to a modern blockchain-based platform after a series of delays. The Australian Securities Exchange’s move to drop the upgrade of its clearing housing system calls time on a project that critics say has cost the country its head-start in developing a more efficient trading system.

Wall Street Sours on Coinbase, Signaling Broad Crypto Doubts; Prices of exchange’s bonds and stock reflect anxieties after collapse of rival FTX and sharp declines in bitcoin
Sam Goldfarb – The Wall Street Journal
A year ago, cryptocurrencies were roaring and Coinbase Global Inc. considered the Charles Schwab of crypto exchanges, was fresh off an IPO that valued the firm at $85 billion. Today, one market-based measure suggests that investors have doubts about whether the company can survive. As a publicly traded entity, the U.S. firm, which originated in San Francisco but says it has no headquarters, seems to have steered clear of the complex financial maneuvers that helped fell FTX, a competitor whose stunning collapse has rocked an already-reeling industry. Nonetheless, Coinbase has been burning through its cash and losing the confidence of investors. Its shares are down 81% since the start of the year, its market capitalization has shrunk to $11 billion, and its bonds are trading at a little more than half their face value.

Australian Exchange Pauses Delayed Blockchain Project; ASX to revisit system plans after Accenture, internal reviews; Project came under pressure after delays, leadership changes
Jackie Edwards – Bloomberg
Australia’s main exchange is reassessing plans to replace its settlement and clearing platform with a blockchain-based system after reviews, suspending work on the years-long project that’s been plagued by delays. ASX Ltd. will revisit all aspects of its work to swap its Clearing House Electronic Subregister System, known as CHESS, for newer technology following an independent review by Accenture Plc and its own internal assessment, the Sydney-based firm said in a statement Thursday.

JPMorgan: The Shrinking Stablecoin Market Is Another Sign of Investors’ Exodus From Crypto
Will Canny – CoinDesk
One way of measuring investors’ exodus from the crypto ecosystem is the shrinkage of the stablecoin market, JPMorgan said in a research report Wednesday. Stablecoins, a type of cryptocurrency whose value is pegged to another asset such as the U.S. dollar, are the equivalent of cash in the crypto world and provide a bridge between fiat currencies and cryptocurrencies, the report said. The growth of the stablecoin market can be viewed as a proxy for the amount of money that has entered the digital assets sector, the report added.

FTX Collapse Slaps the Winklevoss Brothers; The cryptocurrency exchange debacle is spreading to other platforms.
Ellen Chang – The Street
Cryptocurrency brokerages Gemini and Genesis are reassuring people that their operations are still solvent after the massive collapse of exchange FTX. The insolvency of FTX could result in more companies in the industry facing severe liquidity issues, including crypto exchanges and lenders. Gemini, the exchange founded by the Winklevoss twins, is attempting to calm crypto investors. The exchange said on Wednesday that it would halt withdrawals on its Earn accounts that provide interest. The lending partner for the Earn accounts is Genesis.

Crypto’s Transparency May Be Part of the Problem Right Now; More visibility into money movements can help investors, but it can also make concern spread faster
Telis Demos – The Wall Street Journal
In cryptocurrency markets, a little bit of knowledge is proving to be very dangerous. One of the advantages of blockchains and cryptocurrencies cited by proponents is that, contrary to the perception of being shadowy, the digital asset realm is actually very transparent in certain ways. For many digital assets, transactions can be recorded in what is essentially a public forum, on networks known as blockchains. It isn’t necessarily clear who is transacting, but movements of currency from place to place can be visible. If you can match an address to a name, it can give what looks like a detailed picture of a trader or exchange’s comings and goings.

Crypto Contagion Entangles More Customer Cash; With Gemini freezing withdrawals on its yield product and other companies struggling, users with money in online platforms fear for their investments.
Claire Ballentine and Paulina Cachero – Bloomberg
As crypto companies falter, more retail money is getting trapped. In the wake of FTX’s collapse, contagion is spreading across the industry. Crypto lender BlockFi, which has suspended customer withdrawals, is reportedly preparing to file for bankruptcy. Genesis announced Wednesday it was suspending redemptions and new loan originations at its lending business. That led Gemini Trust Co. – founded by the Winklevoss twins – to freeze withdrawals in its yield product, known as Gemini Earn, since Genesis was its partner in that program.

New CEO Says FTX Suffered ‘Complete Failure of Corporate Controls’
Eliot Brown – The Wall Street Journal
FTX suffered a “complete failure of corporate controls” according to the company’s new chief executive who was appointed as part of the crypto exchange’s bankruptcy process. In a filing to federal bankruptcy court, John J. Ray, who has helped oversee some of the biggest bankruptcies ever, including Enron’s, said despite his 40 years in the business of restructuring companies, he’s never seen anything as bad as FTX.

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 a competing bankruptcy case filed in New York by Bahamian liquidators to the state. The filing, led by new CEO and chief restructuring officer for FTX, John Ray, is quite something.

Disgraced FTX founder Sam Bankman-Fried still sees path to rebuilding his bankrupt empire and believes he can make his customers whole
Christiaan Hetzner – FORTUNE
The disgraced founder of FTX, Sam Bankman-Fried, believes there’s enough value locked on the exchange’s balance sheet to repay customer deposits held under custody and rebuild his dying crypto empire. In a tweet thread that suggests the 30-year-old considers himself to be the hero who came up just short, the self-styled altruist said he still held out hope there was a future for a post-bankruptcy FTX. “What can I try to do? Raise liquidity, make customers whole, and restart,” he wrote on Tuesday to his 1 million followers on Twitter. “All I can do is to try. I’ve failed enough for the month, and part of me thinks I might get somewhere.”

More trouble is brewing in the $24 trillion Treasury market: This time, it’s about central clearing
Vivien Lou Chen – MarketWatch
Efforts to reduce risks within the nearly $24 trillion U.S. Treasury market, the world’s deepest and most liquid securities market, are ironically creating angst among market players. The anxiety is centered on the concept of central clearing, a method used to reduce and manage risks in financial markets. In September, the Securities and Exchange Commission proposed rules that would mandate the central clearing of a large swath of Treasury transactions. Only a small percentage of such transactions have centrally cleared in recent years.

Binance proposes fund to save crypto from future failures
Ken Sweet – Associated Press
Cryptocurrency exchange giant Binance is proposing the creation of a rescue fund that would save otherwise healthy crypto companies from failure, aiming to stave off the cascading effects of last week’s implosion of FTX, the world’s third-largest crypto exchange. Binance founder and CEO Changpeng Zhao posted on Twitter Monday that his company would create “an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis.”

FTX Collapse Sparks Calls to Jail “Bernie Madoff of Crypto”; The cryptocurrency exchange suddenly collapsed on November 8, leaving millions of investors reeling.
Luc Olinga – The Street
Sam Bankman-Fried, 30, is by far the most hated man alive today. He has been dubbed the Bernie Madoff of crypto by social media. This portrayal stems from the unexpected and unprecedented bankruptcy of his crypto empire, which will ruin many retail investors. FTX was one of the biggest players in the crypto universe until its collapse on November 8, when Bankman Fried announced that he had reached an agreement to sell his empire, which also includes Alameda Research, a cryptocurrency trading platform, to his rival ChangPeng Zhao and his Binance group.

Coinbase CFO says full contagion impact of FTX collapse still to show – WSJ
The full extent of the fallout on the crypto industry from the collapse of Sam Bankman-Fried’s FTX was yet to come out, Coinbase Global Inc Chief Financial Officer Alesia Haas told the Wall Street Journal on Wednesday.

Crypto Will Soon Threaten Global Financial Stability, FSB Official Says
Lavender Au – CoinDesk
Recent market turmoil has given the Financial Stability Board (FSB) “all the more reason” to develop a globally consistent regulatory framework, an official said on Thursday. The international body monitors and recommends standards for the global financial system, and is made up of major economies and institutions like the International Monetary Fund (IMF).

The FTX Collapse Looks an Awful Lot Like Enron
David Z. Morris – CoinDesk
The corpses of FTX and Alameda Research are barely cold, but financial coroners are already deploying scalpels and bone saws to try and figure out what went wrong. These autopsies are far from complete, but the findings so far suggest deep parallels between the Alameda and FTX blowup and the most infamous business fraud in American history – the Texas-based energy trading con Enron (ENE).

Kevin O’Leary Says He’d Invest in FTX Founder Sam Bankman-Fried Again; O’Leary doesn’t seem too bothered that SBF used $10 billion in FTX customer deposits to prop up his hedge fund.
Matt Novak – GIZMODO
Kevin O’Leary, an investor best known from the show Shark Tank, was asked on Tuesday if he’d still invest in Sam Bankman-Fried again, even after the FTX founder admitted to funneling billions of dollars in customer funds to his own hedge fund and caused the crypto platform to file for bankruptcy last week, upending the entire cryptocurrency sector. O’Leary thinks about the question for a few seconds and said yes, he would invest in Bankman-Fried, in a clip that’s gone viral on social media.

What is the FTX scandal? How the celebrity-endorsed crypto giant collapsed into chaos
Bailey Schulz and Riley Guti̩rrez McDermid РUSA Today
Just months ago, FTX appeared to be a major success story in the cryptocurrency world. Not familiar with the name or the industry? Then let’s start at the beginning.

The Crypto Bros Turn Against Fallen FTX Founder Bankman-Fried; The club of cryptocurrency kings has turned against its unofficial former president Sam Bankman-Fried following his downfall.
Luc Olinga – TheStreet
How fast things go in the world of crypto intrigue. Two weeks ago, Sam Bankman-Fried, the founder of FTX, was still a king maker. He certainly rubbed his peers the wrong way as he tried to influence the regulation of the sector. The industry, however, was happy to see him use his fortune to lobby lawmakers in favor of cryptocurrencies.

Coinbase’s Brian Armstrong and Messari’s Ryan Selkis on crypto rebuilding its reputation after SBF ‘made a lot of people look silly’ in D.C.
Marco Quiroz-Gutierrez – Fortune
Crypto didn’t have a great relationship with regulators pre-FTX meltdown, and two influential industry founders discussed on Wednesday how it could take years now to make meaningful progress in Washington, D.C. Ryan Selkis, founder and CEO of crypto market intelligence company Messari, joined Coinbase CEO Brian Armstrong in a Twitter conversation that focused on, among other topics, damage control for the entire sector.

Silbert’s Once-$10 Billion Crypto Empire Is Showing Cracks; Digital Currency Group’s Genesis suspends lending withdrawals; DCG also is parent of Grayscale, issuer of Bitcoin trust
Katherine 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.

Scaramucci’s SkyBridge bought $10mn of FTX token in return for investment; Fund group received $45mn from Sam Bankman-Fried’s crypto venture in September
Ortenca Aliaj in New York and Joshua Oliver in London – Financial Times
FTX founder Sam Bankman-Fried told Anthony Scaramucci to buy digital tokens created by his cryptocurrency exchange as a condition for him taking a 30 per cent stake in SkyBridge Capital, in an early sign he was trying to support the coin’s price, according to three people with knowledge of the agreement. The Scaramucci-led fund manager SkyBridge bought $10mn worth of FTT, the token issued by FTX, two of the people said. The bankruptcy of FTX after a liquidity crisis in the past week has rocked the cryptocurrency industry, sparking investigations by global regulators and leaving behind as many as 1mn creditors.

Bankman-Fried says filing for FTX bankruptcy was a mistake – Vox
The founder of collapsed crypto exchange FTX, Sam Bankman-Fried, said he regretted his decision to file for bankruptcy and, in an interview published by Vox, criticized regulators. Bankman-Fried said later on Twitter that the basis of the interview, an exchange of messages on the same platform, was not supposed to be public.

Winklevoss Faithful Have a $700 Million Problem in Genesis Halt; Genesis suspends withdrawals in aftermath of FTX’s collapse; Customers of Gemini Earn, a big Genesis lender, left in limbo
Vildana Hajric – Bloomberg
The billionaire Winklevoss twins, owners of the Gemini crypto exchange, have always portrayed themselves as the grownups in the room. The ones who ordinary investors could trust. None of that is sparing a chunk of Gemini’s customers from the fallout triggered by FTX’s collapse, which risks taking down a big swath of the industry. The trouble stems from a product called Gemini Earn — which lets investors accrue as much as 8% in interest by lending out their crypto, including Bitcoin, Ether or stablecoins pegged to the dollar. It’s a kind of product, widely used throughout crypto, that looks and feels very much like high-yield savings accounts, but with far fewer safeguards if things go wrong.

ESG Risk in Capital Markets Triggers Calls for New Rules: Survey; A Bloomberg survey shows Europeans are more in favor of enhanced environmental regulations than Americans, while Asians want more rules – period.
Frances Schwartzkopff and Lisa Pham – Bloomberg
Financial market participants are asking for more regulations and better supervision to help rein in exaggerated ESG claims. A Bloomberg News survey of ESG-related issues found that 53% of 550 Terminal users want more rules to help them tackle environmental issues. The picture varies across regions, with Europeans more in favor of extra regulations than Americans, while both regions gave green issues priority over social or governance matters. In Asia, where efforts to regulate ESG are trailing those in Europe and the US, a majority of survey respondents wanted more rules across the board.

FTX shows founders can still conjure up the ‘reality distortion field’; Investors consistently fail to drill into the hype around tech entrepreneurs such as Sam Bankman-Fried
John Thornhill – Financial Times
Jaded journalists on Fleet Street used to say that some stories were just too good to check. That sentiment appears to have been reworked by venture capitalists on Sand Hill Road: some stories are just too good not to back. So it was with Sam Bankman-Fried: a seemingly brilliant and altruistic cryptopian who appeared to magic up money at will and promised to give it all away to the most needy. The trouble is that Bankman-Fried’s crypto trading empire FTX has now collapsed, swept away in a torrent of anger, recrimination and allegations of fraud. “I fucked upâEUR‰.âEUR‰.âEUR‰. bigâEUR‰.âEUR‰.âEUR‰.âEUR‰multiple times,” he wrote in a series of messages to a Vox reporter this week.

Crypto broker Genesis Trading halts withdrawals at lending unit; Group blames ‘unprecedented market turmoil’ in wake of FTX collapse
Nikou Asgari and Philip Stafford – Financial Times
Genesis Trading has halted withdrawals at its lending unit as the crypto financial services group blamed the “unprecedented market turmoil” sparked by the collapse of Sam Bankman-Fried’s FTX. Genesis, which plays a key role in digital asset fixed income markets, said its decision to suspend redemptions and new loan originations followed “abnormal withdrawal requests which have exceeded our current liquidity”.

Proprietary traders prepare for big year ahead; Prop trading firms are boosting investment in technology and staff in anticipation of another strong year of trading for 2023, a new report from Acuiti finds.
Laurie McAughtry – The Trade
Proprietary trading firms are increasing their investment budgets on the expectation of another strong year of trading, according to the latest Acuiti Proprietary Trading Management Insight Report.

Ukraine Invasion

Top U.S. general plays down probability of near-term Ukraine military victory
Idrees Ali and Phil Stewart – Reuters
The top U.S. general on Wednesday said Ukraine’s chances of any near-term, outright military victory were not high, cautioning that Russia still had significant combat power inside Ukraine despite suffering battlefield setbacks since its invasion in February. Ukraine has vowed to keep the pressure on Russian forces until it reclaims control of all occupied territory. Over the weekend, Ukrainian forces recaptured the strategic southern city of Kherson – stoking optimism about Kyiv’s broader military prospects heading into winter.

With winter approaching, Ukraine prepares to fight on frozen ground
Nathan Rott, Claire Harbage and Hanna Palamarenko – NPR
They load the rockets in a grove of trees, under the cover of yellowing leaves. One by one, they’re lifted from the back of a still-running pickup and slid into the launcher welded to the bed of a neighboring pickup. A group of Russian soldiers has been spotted hiding in a tree line on the west bank of the Dnipro River about 5 miles to the south. The rockets are intended for them. “Fire show,” says a chuckling member of a special Ukrainian Territorial Defense team, who goes by the nickname Badger, as he screws silver percussion caps to the nose of each rocket.

Russia Agrees to Renew Ukraine Grain Deal, U.N. Says; Moscow hasn’t officially commented on a renewal of the July deal
Jared Malsin and William Mauldin – The Wall Street Journal
Moscow agreed to renew an arrangement with Ukraine, Turkey and the United Nations that allows for the export of Ukrainian agricultural products through the war-torn Black Sea region. The extension avoids for now another shutdown of the agreement by Moscow, after Russia briefly dropped out of the deal late last month. Russian officials had been demanding more international access for its food and fertilizer exports ahead of a weekend deadline for the current deal to be renewed.

Russia Sanctions Disrupting Putin’s Military Efforts, Treasury Official Says; Among the steps the U.S. Treasury is taking to make sure its use of sanctions are effective is the hiring of a new sanctions economist, according to Undersecretary Brian Nelson
Dylan Tokar – The Wall Street Journal
Sanctions on Russia have succeeded in disrupting the country’s military manufacturing industry and are squeezing its economy, a senior U.S. Treasury Department official said. The economic restrictions imposed by the U.S. and its allies have forced Russian tank manufacturers to shut down for a period, making it difficult for the country to obtain key parts such as ball bearings, according to Brian Nelson, undersecretary for the Treasury’s Office of Terrorism and Financial Intelligence, also known as TFI.

Zelenskiy Says No Peace Until Ukraine Gets Crimea, Donbas Back; ‘A simple ceasefire won’t do the trick,’ Zelenskiy says; In interview, Zelenskiy says Crimea ‘part of our country’
John Micklethwait and Daryna Krasnolutska – Bloomberg
Ukrainian President Volodymyr Zelenskiy said taking back Crimea, which was annexed by Russia in 2014, as well as the country’s long-occupied eastern Donbas region are conditions for bringing the nine-month war to an end. “A simple ceasefire won’t do the trick,” Zelenskiy said in a video interview at the Bloomberg New Economy Forum in Singapore. “Unless we liberate our whole territory, we will not bring peace.” Seizing back all of Ukraine’s internationally recognized territory would entail ambitions that stretch beyond Russian military gains since its invasion launched in February. After Russia took over Crimea eight years ago, the Kremlin supported separatist forces in Donbas in a conflict that simmered despite a Franco-German-led peace initiative, effectively occupying much of the regions of Luhansk and Donetsk.

Believe It or Not, Putin’s Foes Are Now Nazi Satanists; Russians have been told Ukrainians are pawns of the West. Or they don’t exist at all. Or they’re Nazis. And Satanists. And many believe these absurdities.
Andreas Kluth – Bloomberg
If you are Russian and inhabit the propaganda universe created by your president, Vladimir Putin, it must be hard keeping up with the reasons why your country had to attack and brutalize Ukraine. At one point, Russia was forced to invade because otherwise NATO would have taken Ukraine. Then you had to attack because Ukraine isn’t a country at all, but part of Russia, which Ukrainians had forgotten. Actually, it was because the Ukrainians, including their Jewish president, are Nazis. No? Well, they’re definitely terrorists. Come to think of it, Ukrainians are actually Satanists. So, just to be clear, Russia is fighting to “stop the supreme ruler of Hell, whatever name he uses – Satan, Lucifer or Iblis.”

How the Russia-Ukraine War Can and Cannot End; Brewing talk of a diplomatic solution to the conflict demands an honest look at the possible end games.
Leonid Bershidsky – Bloomberg
The White House went into damage-control mode after General Mark Milley, chairman of the Joint Chiefs of Staff, suggested that there’s no military solution to the Russia-Ukraine conflict and diplomacy is needed to end it: The official US position is that Ukraine itself should set the terms of the peace and decide when, if ever, it’s ready to talk. Yet after Tuesday’s incident with two missiles landing in Polish territory after a massive Russian strike on Ukrainian power stations, it should be clear why Milley appeared to swim against the U.S. policy tide.

Exchanges, OTC and Clearing

COP27: Cboe Global Markets and Deutsche Borse join the Net Zero Financial Service Providers Alliance
Sustainable Stock Exchanges Initiative
On the occasion of COP27, two new exchanges are joining the Net Zero Financial Service Providers Alliance (NZFSPA) to support a net zero transition of their markets and commit to becoming net zero by 2050 at the latest. Part of the Glasgow Financial Alliance for Net Zero (GFANZ), the NZFSPA is a global group of Financial Service Providers committed to supporting the goal of global net zero greenhouse gas emissions by 2050 or sooner, in line with the ambition to limit the global temperature increase to 1.5°C above pre-industrial levels. Organised into 6 sub-groups, the NZFSPA brings together 27 financial market service providers, including 6 exchanges. With Cboe Global Markets and Deutsche Borse joining, the subgroup of exchanges is now 8 members strong and the largest subgroup within the alliance.

ICE TCFD Solution Provides Greater Transparency Into Carbon Emissions for Asset Managers and Institutional Investors
Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today announced the launch of a new service to help asset managers and other financial institutions comply with Task Force for Climate-Related Financial Disclosures (TCFD) requirements. The TCFD’s reporting framework has been adopted or recommended by many regulatory bodies throughout North America, Europe and Asia as a model for reporting climate-related financial information. Although there has been progress among asset managers reporting some disclosures recommended by the Task Force, very few (less than 10%) have reported meeting all of the requirements, which is mostly a result of the partial or lack of reporting of carbon and other greenhouse gas (GHG) emissions by many underlying companies around the world.

Cboe Global Markets Declares Fourth-Quarter 2022 Dividend
Cboe Global Markets, Inc. (Cboe: CBOE), a leading provider of global market infrastructure and tradable products, today announced its Board of Directors has declared a quarterly cash dividend of $0.50 per share of common stock for the fourth quarter of 2022. The fourth-quarter 2022 dividend is payable on December 15, 2022, to stockholders of record as of November 30, 2022.

SGX Group welcomes eBest Investment & Securities Co. Ltd. as Derivatives Trading Member
SGX Group is pleased to welcome eBest Investment & Securities Co. Ltd. as a Trading Member of its derivatives market. Founded in 1999, eBest Investment & Securities Co. Ltd is one of the top brokerage firms in South Korea providing investment brokerage and financial related services. Today, it serves some of the largest institutions and corporates, as well as retail investors in Korea.

ASX Will Reassess All Aspects Of The Chess Replacement Project And Derecognise Capitalised Software Of $245-255 Million Pre-Tax In 1H23
Key points: ASX will reassess all aspects of the CHESS replacement project following completion of an independent review, conducted by Accenture, and its own internal assessment.


Twitter’s Fake-Account Problem Got Messier With Musk. It May Get Worse; Twitter’s paid verification system is scheduled to come back later this month.
Queenie Wong – CNET
Twitter’s initial effort to charge money to verify accounts with blue check marks was a chaotic mess. That isn’t stopping Elon Musk, the company’s new owner, from resurrecting the idea. Last week, Twitter started allowing some users to pay $8 per month to verify their account as part of a subscription plan known as Twitter Blue. The company quickly paused the plan after fake accounts with blue checks began posing as major brands, athletes and politicians. On Tuesday, Musk tweeted the paid verification system would return on Nov. 29.

Elon Musk’s Twitter is Imploding
Twitter is becoming a deeper, darker cesspool of dysfunction and disinformation, with new owner Elon Musk making things worse every day. Sen. Ed Markey even had a fake Twitter account try to impersonate him. He joins Mehdi to discuss.

Twitter Sued by Fired Contractor for Failing to Give Notice; Rodriguez seeks to represent thousands of other workers fired; Former employee also seeking final pay, expense reimbursement
Joe Schneider – Bloomberg
Twitter Inc., which fired thousands of employees since being bought by Elon Musk, was sued by a former contractor for failing to give proper notice, final pay and to reimburse his expenses. Francisco Rodriguez was employed by Twitter through PRO Unlimited Inc, known as Magnit and fired on Nov. 12, along with potentially 4,400 to 5,500 others, according to a complaint filed in San Francisco federal court Wednesday. Rodriguez is seeking to represent all those workers in a class-action lawsuit.

Elon Musk Gives Twitter Employees a Deadline to Stay or Leave; Mr. Musk said that workers would need to answer through an online form by late Thursday and that those who stayed would be “working long hours at high intensity.”
Kate Conger – The New York Times
Elon Musk gave Twitter employees a deadline of 5 p.m. Eastern time on Thursday to decide if they wanted to work for him, and he asked those who did not share his vision to leave their jobs, in his latest shock treatment of the social media company. Mr. Musk made the announcement in an early-morning email to employees on Wednesday; The New York Times obtained the message, which had the subject line “A Fork in the Road.” In the note, Mr. Musk, 51, reiterated that Twitter faced a difficult road ahead and offered employees three months of severance if they did not want to continue working there “to build a breakthrough Twitter 2.0.”

Hidden Emissions From Cloud Computing Pose Net-Zero Threat; Regulators push back against cloud providers including Google, Amazon and Microsoft.
Gautam Naik – Bloomberg
Emissions linked to cloud computing aren’t being properly accounted for in carbon calculations, potentially overstating corporate progress on net-zero pledges and hindering the broader effort to curb greenhouse gases. “It has become something of a hidden emissions issue,” said John Ridd, chief executive officer of Greenpixie, a UK-based firm that designs software to identify cloud emissions. Ridd will discuss cloud-related emissions at a COP27 panel Thursday.

Australia’s Biggest Stock Exchange Shelves Blockchain Project, Writes Off $170M
Sujith Somraaj – Decrypt
Australian Securities Exchange (ASX) has shelved its seven-year-long project to ramp up the exchange’s CHESS clearing and settlement system using blockchain after an independent audit by Accenture reported issues. ASX developed CHESS (Clearing House Electronic Subregister System) 25 years ago to process securities trading electronically.


Iranian hackers compromise US government network in cryptocurrency generating scheme, officials say
Sean Lyngaas – CNN
Iranian government-sponsored hackers compromised the network of an unnamed US federal government agency starting in February, stealing passwords on the network and installing software to generate cryptocurrency, US officials said Wednesday. Though the hack likely began in February, officials at the Department of Homeland Security responded to the breach in June to clean up the network of the civilian agency, the FBI and DHS’s Cybersecurity and Infrastructure Security Agency (CISA) said in a public advisory. The hackers exploited a widely known vulnerability that CISA sounded the alarm about in December 2021 and ordered agencies to address.

Swiss arrest alleged Ukrainian cybercriminal hunted by the FBI for a decade
Sean Lyngaas – CNN
A Ukrainian man wanted for over a decade by the FBI for a multimillion-dollar hacking scheme has been arrested in Switzerland and is awaiting extradition to the US, Swiss authorities confirmed to CNN Wednesday. Vyacheslav Penchukov, known as “Tank” online, is accused of being a major player in a racketeering ring that allegedly drained millions of dollars from the bank accounts of Americans and other nationalities in the late 2000s and early 2010s. Penchukov was arrested in the canton of Geneva, Switzerland on October 23, and Swiss authorities “decided to grant” his extradition to the US on Tuesday, Raphael Frei, a spokesperson for the Swiss Federal Department of Justice and Police, said in an email.

US Cyber Review Punts on Russian Hack, Hinting at Limitations; NTSB-style group lacks the same authority.
Jeff Stone – Bloomberg
The inaugural report from the US’s much-hyped new cyber review board was supposed to assess the massive SolarWinds hack that roiled the security community. Instead, the council, modeled after the group that examines aviation crashes, ended up investigating another incident, inadvertently illustrating the flaws in its original design. After an executive order last year the White House established the Cyber Safety Review Board, a panel of experts charged with examining hacking incidents that threaten US national security.


In the Markets: Crypto firms find innovative ways to say how sad they are
Aaron Elstein – Crain’s New York Business
Wall Street firms used to pull no punches when they had bad news for customers. As markets sank in 1998, Merrill Lynch sent a memo to its sales force with the acronym ACORN, which stood for “Advise clients our responsibility: none.”

Crypto to resemble currency market after FTX collapse, says DRW offshoot; Crypto to stay in “countless silos,” not centralized exchanges; Trading firm expects recovery on the heels of FTX bankruptcy
Carly Wanna – Bloomberg
The collapse of Sam Bankman-Fried’s FTX exchange is likely to hasten the crypo market’s evolution to a less-concentrated structure resembling the one underpinning traditional currency markets, according to crypto trading firm Cumberland. The firm, an offshoot of the Chicago-based trading giant DRW, tweeted on Monday that a few parties had dominated crypto spot trading and derivatives markets.

FTX’s Bahamas liquidators question the validity of U.S. bankruptcy
Dietrich Knauth – Reuters
Liquidators for FTX’s Bahamas unit, FTX Digital Markets, have asked a New York City court to recognize its bankruptcy in the Bahamas, saying they “reject the validity” of the cryptocurrency exchange’s U.S. bankruptcy proceedings. The Bahamas liquidators, who were appointed on Nov. 10 by the Securities Commission of the Bahamas, filed a Chapter 15 petition late on Tuesday in U.S. bankruptcy court in New York, asking the court to help them obtain records from FTX and block asset transfers to protect creditors of the Bahamas-based company.

Changpeng ‘CZ’ Zhao won this crypto war. Is he any better than Sam Bankman-Fried?
Vivienne Walt – FORTUNE
The man sipping espresso in a posh London hotel looked like any high-flying executive, in his dark suit, iPhone at the ready. It was a far cry from the trademark look of Changpeng Zhao, CEO and cofounder of the world’s biggest crypto exchange, Binance: sneakers and a black hoodie. The makeover was necessary, Zhao explained over breakfast with Fortune earlier this year, because he was headed to a day of meetings and a cheese-and-wine reception with British lawmakers and business leaders, in a country where Binance was under scrutiny and legally barred from soliciting clients. Then Zhao, or CZ as he’s commonly known, pushed up his shirt sleeve to show the Binance logo tattooed on his right forearm: He was still a rebel at heart.

Tom Brady among celebrities named in FTX lawsuit
Ken Sweet – Associated Press News
A host of Hollywood and sports celebrities including Larry David and Tom Brady were named as defendants in a class-action lawsuit against cryptocurrency exchange FTX, arguing that their celebrity status made them culpable for promoting the firm’s failed business model. FTX has been in the public eye for more than a week, after the third-largest cryptocurrency exchange ended up with billions of dollars worth of losses and had to seek bankruptcy protection on Friday. The Bahamas-based company and its founder, Sam Bankman-Fried, are under investigation by state and federal authorities for allegedly investing depositors funds in ventures without their approval.

The Troubling Past of Matt Damon’s Crypto.com CEO Resurfaces; Crypto.com and its CEO Kris Marszalek have been under pressure since the FTX debacle.
Luc Olinga – The Street
The unexpected bankruptcy of FTX, one of the largest cryptocurrency exchanges in the world, caused an earthquake in business and political circles. The magnitude of the shock reflects the central role played by FTX and its founder, Sam Bankman-Fried, in building the young industry, which aims to disrupt traditional financial services.

A crypto security CEO did business with Sam Bankman-Fried and sent a team to the Bahamas. He was shocked by the lack of interest in security controls and FTX’s grand ideas: ‘Maybe we’ll buy Goldman Sachs’
Shawn Tully – FORTUNE
In mid-July of 2021, Pascal Gauthier made a call to the 29-year-old who’d wowed investors and the media by building a big trading platform at warp speed, and emerged as the crypto field’s most charismatic lobbyist: Sam Bankman-Fried. “I wanted to learn what his secret sauce was, to grow his business so quickly,” recalls Gauthier, CEO of Ledger, a leading purveyor of hardware wallets for securely storing digital currencies.

FTX Creates Crypto Contagion; Genesis, the FTX balance sheet, futures clearing, and performance coaching.
Matt Levine – Bloomberg
We talked yesterday about Binance Holdings Ltd.’s proposal for a sort of central bank of crypto, an “industry recovery fund” that would “help projects who are otherwise strong, but in a liquidity crisis.” The sudden collapse of Sam Bankman-Fried’s crypto exchange FTX.com, and his associated crypto hedge fund Alameda Research, could trigger liquidity crises at otherwise healthy crypto firms. Or, of course, not. Those firms could have had assets at FTX that are now gone. Or they could have made undercollateralized loans to Alameda that are now gone. What do I know. In any case the FTX collapse triggered a crisis of confidence that spread to other firms, healthy or not.

FTX’s Bahamas liquidators question the validity of U.S. bankruptcy
Dietrich Knauth – Reuters
Liquidators for FTX’s Bahamas unit, FTX Digital Markets, have asked a New York City court to recognize its bankruptcy in the Bahamas, saying they “reject the validity” of the cryptocurrency exchange’s U.S. bankruptcy proceedings.

Binance to Relaunch Bid for Bankrupt Lender Voyager: Source
Ian Allison – CoinDesk
Binance.US, the American arm of the world’s largest cryptocurrency exchange, is preparing to bid for bankrupt lending platform Voyager Digital, according to a person familiar with the plans. A previous auction, which was completed around the end of last September, saw the now defunct FTX emerging as the “white knight,” winning out against rivals Wave Financial and Binance. At the time, CoinDesk had also reported that Binance’s bid for the U.S.-based Voyager had been shut out due to national security concerns.

FTX Contagion Hits Winklevoss Twins as Crypto Lenders Come Under Fire
Yueqi Yang and Anna Irrera – Bloomberg
The fallout from the rapid collapse of Sam Bankman-Fried’s FTX is spreading across the crypto world, ensnaring the billionaire Winklevoss twins through a liquidity squeeze at their lending partner, Genesis. Genesis is suspending redemptions and new loan originations at its lending business after the unit faced withdrawal requests that exceeded current liquidity. Gemini Trust Co., founded by Cameron and Tyler Winklevoss, subsequently announced its yield product for retail investors will also halt redemptions as Genesis was a key partner in the program.

New Chief Calls FTX’s Corporate Control a ‘Complete Failure’; “This situation is unprecedented,” said John J. Ray III, who helped manage Enron after its collapse in an accounting fraud scandal in 2001.
David Yaffe-Bellany – The New York Times
John J. Ray III, the new chief executive of the collapsed cryptocurrency exchange FTX, said in a bankruptcy filing on Thursday that he had never seen “such a complete failure of corporate control” in his career working with distressed companies.

The End of the ‘Centralization Era’ in Crypto
Shingo Lavine and Adam Lavine – CoinDesk
When we look back at November 2022, we may well view it as the end of the “Centralization Era” in crypto. Centralized crypto exchanges offered consumers an appealingly convenient way to invest in crypto. However, the centralization era also led to disregard for consumer protection and massive meltdowns that have affected tens of millions of people and hundreds of billions in assets. Consumers are learning very hard lessons about the risks of centralization.

Binance CEO Changpeng Zhao a ‘walking time bomb’ after FTX collapse, ‘Dr. Doom’ warns
Thomas Barrabi – NY Post
The economist known as “Dr. Doom” slammed cryptocurrency platform Binance’s CEO Changpeng Zhao as a “walking time bomb” on Wednesday following the implosion of its rival FTX. Nouriel Roubini, a New York University professor, blasted top figures in the cryptocurrency sector as “con men” just days after leading platform FTX collapsed into bankruptcy.

Indian crypto exchange CoinSwitch says proof of reserves shows sufficient reserves to match clients’ stake
Pradipta Mukherjee – Forkast
Indian crypto exchange CoinSwitch’s proof of reserves summary, that was shared on Thursday, stated that as of Nov. 4, the exchange’s overall holdings of crypto and fiat balances in Indian Rupees (INR) exceeded those held by the exchange on behalf of its users.

Justin Bieber Paid $1.3 Million for a Bored Ape NFT. It’s Now Worth $69K
Andrew Hayward – Decrypt
Bored Ape Yacht Club hype was in full swing earlier this year as celebrities “aped into” the pricey Ethereum NFT collection. Some have even used their Apes to create products, themed restaurants, live performances, and more. But the buzz has faded amid the crypto bear market, and the price to join the exclusive club has been dropping lower and lower in recent weeks. And a “floor” Bored Ape, like the one that singer Justin Bieber spent $1.3 million worth of ETH to buy in January, now sells for a tiny fraction of that price point.

They Fled Wall Street for Crypto. They Have Few Regrets; Young employees flocked to digital currency firms as asset prices soared. The implosion of Sam Bankman-Fried’s empire is a big test of faith.
Paulina Cachero, Claire Ballentine, and Charlie Wells – Bloomberg
First, stablecoin TerraUSD collapsed. Then hedge fund Three Arrows Capital went under, dragging Voyager Digital and Celsius Network down with it. In the latest blow, Sam Bankman-Fried’s empire – once considered a crypto savior – imploded, causing a crisis of confidence that’s wiped out billions of dollars and is spreading to companies across the industry.


Donald Trump ‘Can’t Get Elected,’ Billionaire Peterffy Says
Amanda L Gordon – Bloomberg
Billionaire Thomas Peterffy, founder of Interactive Brokers Group Inc., said it’s time for the Republican Party to move on from Donald Trump. “I think we need a fresh face,” Peterffy, who contributed $250,000 to Trump’s 2020 campaign, said Wednesday in an interview. “The problem with Trump is he has so many negatives, he can’t get elected, period.” Peterffy, 78, said he would vote for Trump if the former president ends up being the GOP nominee in 2024, but added, “I will do whatever I can to make sure he is not.”

Skybridge’s Anthony Scaramucci says a second Trump presidency would be the ‘Holy Trinity’ for a bruised stock market
Chloe Taylor – FORTUNE
A 2024 Trump Presidency could help juice battered stock markets, according to ex-White House communications director Anthony Scaramucci, but warned about his former boss’s tendency to rock political stability. Former U.S. President Donald Trump announced from his Florida estate on Tuesday night that he was launching a third White House campaign. “I am running because I believe the world has not yet seen the true glory of what this nation can be,” he told an audience at his Mar-a-Lago club.

US Plans to Unveil More Data on Treasuries Trading to Help Bond Market; Treasury’s Nellie Liang unveils proposal at New York event; Trade data would start with on-the-run nominal Treasuries
Liz McCormick – Bloomberg
US regulators are taking a fresh step toward enhancing the level of public reporting of Treasuries trading data, a move aimed at helping boost the resiliency of the world’s biggest bond market. “We are proposing to provide transaction-level transparency to the public, in a gradual and in a calibrated way,” the Treasury Department’s top domestic finance official, Nellie Liang, said in remarks at an annual conference on the Treasuries market in New York Wednesday. “We will walk, not run,” she said, without specifying when the new trading data will start getting released.

Chuck Schumer Quietly Moving Lame-Duck $3 Billion Payout to Families of 9/11 Victims
Ryan Grim and Daniel Boguslaw – The Intercept
Senate majority leader Chuck Schumer has hotlined a bill that would redistribute almost $3 billion to the families of victims of 9/11 that had initially been appropriated for the Covid-era Paycheck Protection Program, according to multiple Democratic Senate sources. Hotlining a bill is the first step in an effort to move legislation through the Senate by unanimous consent. If no senators object, then the measure will pass with no debate and no vote. Families of 9/11 victims were compensated by a special fund created shortly after the 2001 attack.

U.S. Treasury’s Yellen says crypto markets need better oversight
U.S. Treasury Secretary Janet Yellen said on Wednesday that crypto markets need more robust oversight, days after cryptocurrency exchange FTX collapsed. “The recent failure of a major cryptocurrency exchange and the unfortunate impact that has resulted for holders and investors of crypto assets demonstrate the need for more effective oversight of cryptocurrency markets,” Yellen said in a statement, without directly naming FTX.

Banker Lured by CIA Held ‘Valuable Information’ About Russians; Ex-Meinl banker, fighting extradition to US, denies wrongdoing; Former Meinl colleague says US was more focused on laundering
Jonathan Browning – Bloomberg
US officials investigating international money laundering believed a senior Austrian banking executive held “valuable information” about individuals in Russia and Ukraine, one of his colleagues said. Peter Weinzierl, the former chief executive officer of Meinl Bank AG, was arrested on US charges at a London airfield after piloting his private plane into the country in May last year. He says he was “lured” by a self-described CIA agent to Britain from where he could be more easily extradited to the US.

Financial Risks Shouldn’t Shape Fed Rate Decisions, Williams Says; NY Fed chief says must strengthen financial market resilience; Monetary policy shouldn’t be ‘jack of all trades’: Williams
Matthew Boesler – Bloomberg
The Federal Reserve should stay focused on its economic goals and avoid incorporating financial stability risks into its deliberations as it raises interest rates, New York Fed President John Williams said. “Using monetary policy to mitigate financial stability vulnerabilities can lead to unfavorable outcomes for the economy,” Williams said Wednesday in remarks prepared for a Treasury market conference at the New York Fed. “Monetary policy should not try to be a jack of all trades and a master of none.”

Acting Comptroller of the Currency Discusses Regulatory Priorities
U.S. Office of the Comptroller of the Currency
Acting Comptroller of the Currency Michael J. Hsu today testified before the U.S. House Financial Services Committee on the agency’s efforts to ensure that national banks and federal savings associations operate in a safe, sound, and fair manner. His testimony discussed his regulatory priorities of guarding against complacency by banks, reducing inequality in banking, adapting to digitalization, and managing climate-related financial risks. Acting Comptroller Hsu also discussed the OCC’s work to promote the health and viability of community banks and minority depository institutions that the agency supervises.

Russia’s economy enters recession with 4% contraction; Western sanctions after invasion of Ukraine contribute to sharpest downturn since pandemic
Daria Mosolova – Financial Times
Russia’s economy contracted for the second quarter in a row as the western response to Moscow’s invasion of Ukraine helped plunge the economy into recession. Russia’s gross domestic product fell by 4 per cent year-on-year in the three months to October, according to preliminary data released by the federal statistics service Rosstat. The contraction follows sweeping restrictions from the US and Europe on Russia’s energy and financial sectors, including a block on half of the central bank’s $640bn in foreign exchange reserves. About 1,000 western companies followed suit, curtailing their Russian operations, while hundreds of thousands of people left the country after president Vladimir Putin mobilised the army’s reserves in September.


Beware the proposed US crypto regulation – it may be a Trojan horse; Creating a bespoke regime will inevitably become a route for traditional financiers to avoid their own tougher rules
Hilary Allen – Financial Times
Following the spectacular failure of crypto exchange FTX International, there have been renewed calls for crypto legislation (including from the industry itself). But many of the proposals so far would be worse than the status quo – at least for the general public. Crypto firms such as FTX were involved in drafting many of the mooted US bills. The exchange’s implosion should not become a pretext for rushing these into law. It is unfortunately true that many of FTX’s users have suffered mightily. The good news, though, is that the broader economy hasn’t suffered as a result of its failure (the economic fallout from crypto flops such as Terra/Luna and Celsius this year was similarly limited). Since crypto isn’t integrated with the traditional financial system, the pain has not spread to those who chose not to invest in crypto in the first place.

Ripple gets support from Blockchain Association in XRP lawsuit against SEC
Timmy Shen – Forkast
U.S. lobby group Blockchain Association, along with other institutions and firms, have formally filed amici briefs to support Ripple Labs Inc. in the ongoing lawsuit between the U.S. Securities and Exchange Commission (SEC) and Ripple. The Blockchain Association filed its amicus brief on Tuesday, saying: “The SEC’s extremely broad interpretation of the securities laws would have devastating effects on the industry (and even outside the industry).”

Bahamas could not have prevented FTX collapse, prime minister says; Philip Davis indicates country has ‘not identified any deficiencies’ in crypto regulatory framework
Scott Chipolina – Financial Times
The Bahamas could not have prevented the failure of digital asset exchange FTX and has found no “deficiencies” in its crypto regulations, the country’s prime minister told parliament on Wednesday. Philip Davis said his country did not have sole oversight of FTX’s worldwide operation and investigations into the collapse of Sam Bankman-Fried’s crypto empire would be of “national importance”.

BCSC alleges crypto trading platform is violating Securities Act
British Columbia Securities Commission – PRNewswire
The B.C. Securities Commission (BCSC) alleges that the operator of a crypto asset trading platform is facilitating derivatives transactions without being registered and is operating as an exchange in B.C. without being recognized by the Commission. Latoken, an online cryptocurrency platform operated by LiquiTrade Ltd., purportedly has more than 1.5 million registered users who trade more than 240 crypto assets and processes more than US$300 million in transactions daily. LiquiTrade is incorporated in the Cayman Islands and has operated Latoken since 2020.

CFTC Charges Former Energy Broker with Paying Brokerage Kickbacks and Misappropriating Nonpublic Information
The Commodity Futures Trading Commission today issued an order simultaneously filing and settling charges against Lee Tippett, a former energy broker with Classic Energy, LLC, for participating in a scheme to pay kickbacks to Matthew Clark, a trader employed by one of Classic’s brokerage customers. The order finds Tippett made these kickback payments to Clark in exchange for Clark sending more brokerage business from his employer to Classic. According to the order, Tippett also participated in a scheme to misappropriate confidential block trade order information from the same Classic customer, facilitated fictitious trades, and made false statements to ICE Futures US.

FINRA Proposal To Amend The Codes Of Arbitration Procedure To Modify The Current Process Relating To The Expungement Of Customer Dispute Information
FINRA filed a proposed rule change with the Securities and Exchange Commission to modify the current process relating to the expungement of customer dispute information.

Former SEC Official Doubts FTX Crash Will Prompt Congress to Act on Crypto Regulations
Fran Velasquez – CoinDesk
The collapse of FTX may spur more calls for regulation on Capitol Hill, Lisa Braganca, a former enforcement branch chief at the U.S. Securities and Exchange Commission, said, but she is doubtful about whether Congress will act. “I have serious doubts still about whether Congress wants to step in and do something rather than letting the SEC and the CFTC (Commodity of Futures Trading Commission) figure it out,” Braganca said during an appearance on CoinDesk’s “First Mover” program on Wednesday. “This is complicated.”

“The Beatles and the Treasury Market”: Remarks Before the U.S. Treasury Market Conference
Chair Gary Gensler – SEC
Thank you. It’s good to be here for the eighth annual U.S. Treasury Market Conference. Thank you to the conference organizers and my colleagues across the Inter-Agency Working Group on Treasury Market Surveillance (IAWG) for putting it together and issuing the latest IAWG report.
As is customary, I’d like to note that I’m not speaking on behalf of my fellow Commissioners or the SEC staff.

Digital Assets: Putting Investors First
Commissioner Jaime Lizárraga – SEC
Thank you for that warm introduction. It is a pleasure to be here today, and I thank Brooklyn Law School for the kind invitation to deliver today’s keynote. I must note at the outset that the views expressed here today are my own and do not necessarily reflect the views of the Commission or its staff, or those of my fellow Commissioners.

SEC Obtains Final Judgments Against Two Family Office Executives Charged with Insider Trading
On November 14, 2022, the United States District Court for the Southern District of New York entered a final consent judgment against Charles Rustin “Rusty” Holzer, a manager of a family office, whom the SEC previously charged with insider trading. On October 28, 2022, a final consent judgment was entered against Fernando Moraes, the former Chief Operating Officer of Holzer’s family office, who was also previously charged with insider trading.

Rolling regulation forwards
Nikhil Rathi – FCA
Our role as regulators is to help us seize opportunities whilst also navigating the rules of sometimes dangerous terrain or as one commentator wrote recently, the jungle.
Now, let me start by addressing the elephant in the jungle. The Consumer Duty. We know that you have concerns about it. How could we measure it? How could we quantify it? How would we monitor it? Parliament debated and explicitly mandated the Consumer Duty due to falling public confidence in retail financial services.âEUR¯

Former CEO, CFO and Independent Directors of Hyflux Ltd charged with offences under the Securities and Futures Act and the Companies Act
Monetary Authority of Singapore (MAS)
The former Chief Executive Officer of Hyflux Ltd (Hyflux), Ms Lum Ooi Lin, its former Chief Financial Officer, Mr Cho Wee Peng, and four independent directors of Hyflux at the material time were charged in court today for disclosure-related offences under the Securities and Futures Act (SFA). Ms Lum was further charged with an offence under the Companies Act (CA) for her failure in ensuring Hyflux’s compliance with accounting standards.

Investing and Trading

Is a Shake-Up Coming to The Wall Street Journal?
Joe Pompeo – Vanity Fair
Five years ago, when The Wall Street Journal rumor mill was churning about editor in chief Gerry Baker’s highly anticipated exit, two names emerged as favorites to take his place at the storied broadsheet. One was Matt Murray, a respected long-serving Journal veteran who’d recently been promoted to the No. 2 job there. The other, as I reported at the time, was Emma Tucker, then deputy editor of The Times of London, a sister publication in the sprawling family tree of Rupert Murdoch’s News Corp.

Robinhood Markets, Inc. Reports October 2022 Operating Data
Robinhood Markets, Inc.
Robinhood Markets, Inc. (“Robinhood”) (NASDAQ: HOOD) today reported selected monthly operating data for October 2022. Net Cumulative Funded Accounts (NCFA) at the end of October were 22.9 Million, up approximately 30 thousand from September 2022. Monthly Active Users (MAU) at the end of October were 12.5 Million, up 0.3 Million from the end of September 2022.

Investment Giants With $2.3 Trillion Bet on More Market Turmoil; GIC has “dry powder” ready to deploy as opportunities come up; China Asset Management says loosening policy sets China apart
David Ramli, Zhang Dingmin, Amy Bainbridge and David Scanlan – Bloomberg
Tumbling global stock and bond prices this year, together with pain in private equity amid deteriorating deal volume left investors around the world casting their nets far and wide for opportunities. In interviews with Bloomberg News, seven institutional investors with about $2.3 trillion in combined assets under management from Beijing to Toronto and Melbourne outlined investment plans heading into what’s likely to be a challenging 2023.

US diesel and heating oil stocks scrape lows before winter; Prices escalate for distillate fuels amid fears of bidding war with Europe
Amanda Chu – Financial Times
US stocks of diesel and heating oil have plunged to historic lows, driving up prices for fuels critical to industry, freight, farming and many households. Inventories of the fuel category that includes both products stood at 107.4mn barrels last week, according to government data released on Wednesday, up slightly from the week before but the lowest level for this time of year since 1951.

Environmental, Social and Corporate Governance

Airline Offers Shot at Greener Flight to Climate Summit in Dubai; Etihad and World Energy partner on plan to decarbonize flights; Flights from LAX set to use sustainable aviation fuel
Jennifer A Dlouhy – Bloomberg
The jets that deliver delegates to the annual UN climate summit are a major source of greenhouse gas emissions — and an embarrassment for conference-goers seeking to shrink the world’s carbon footprint. Enter Etihad Airways PJSC and US biodiesel producer World Energy, which are selling an alternative for delegates to next year’s COP28 climate negotiations in the United Arab Emirates.

ESG Risk in Capital Markets Triggers Calls for New Rules: Survey; A Bloomberg survey shows Europeans are more in favor of enhanced environmental regulations than Americans, while Asians want more rules – period.
Frances Schwartzkopff and Lisa Pham – Bloomberg
Financial market participants are asking for more regulations and better supervision to help rein in exaggerated ESG claims. A Bloomberg News survey of ESG-related issues found that 53% of 550 Terminal users want more rules to help them tackle environmental issues. The picture varies across regions, with Europeans more in favor of extra regulations than Americans, while both regions gave green issues priority over social or governance matters. In Asia, where efforts to regulate ESG are trailing those in Europe and the US, a majority of survey respondents wanted more rules across the board.

ESG enforcement is on the rise: Are you ready?
Kelly Gibson, Michael Hacker and Liz Goldberg – Reuters
Investors and U.S. financial regulators have made clear that they seek to hold companies and asset managers responsible for public statements they make about ESG. When the Securities and Exchange Commission (SEC) created the Climate and ESG Task Force within the Division of Enforcement with the express purpose of identifying ESG-related misconduct, many public companies and investment advisers started preparing for expected enforcement actions. The Task Force is using a variety of methods and potential sources to proactively identify “material gaps or misstatements in issuers’ disclosure of climate risks under existing rules, and disclosure and compliance issues relating to investment advisers’ and funds’ ESG strategies.” It also works closely with other SEC Divisions and Offices, including the Divisions of Corporation Finance, Investment Management, and Examinations.

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.

Amazon Employees Fear ‘No One Is Safe’ as Layoffs Roil the Ranks; Some staff wonder why CEO Jassy hasn’t addressed the troops; One called ‘lack of transparency’ from leadership ‘disgusting’
Spencer Soper – Bloomberg
“No one is safe.” So wrote an Amazon.com Inc. employee on an internal chat room as the company began the largest round of layoffs in its history. The mood, especially in the hard-hit devices team, reflected the shock and dismay of people more accustomed to growing budgets and moonshots than talk of recession and austerity. Devices chief Dave Limp, in a note to his team on Wednesday, said the firings pained him. He pledged severance payments for people who can’t find other jobs inside the company.

Netherlands Says ESG-Linked Debt Is Longer-Term Possibility; State treasury official says seeking primary-dealer feedback; Dutch SLB would be first of its kind from European sovereign
Libby Cherry and Greg Ritchie – Bloomberg
The Netherlands has raised the prospect of one day building out its debt issuance to include bonds that link interest payments to ESG targets, in what would be a first for a European government. So-called sustainability-linked bonds, or SLBs, typically see issuers pay a premium if they miss pre-determined environmental, social or governance goals — and sometimes receive a discount if they achieve them. Though popular among companies, the only governments that have issued SLBs so far are Chile and Uruguay.


Banks Need to Worry About Shadow Banks; The boom in market-based finance has taken risks away from regulated lenders, but recent crises show they’re still exposed.
Paul J. Davies – Bloomberg
What do Bill Hwang, the disgraced US investor, and Liz Truss, Britain’s shortest-serving prime minister, have in common? They were behind two of the multiple mini-crises in recent years that have gotten investors, bankers and regulators sweating about systemic risks for financial markets and investment funds. What people aren’t talking about enough, however, is the knock-on effect for banks.

$17 billion Chicago hedge fund follows Millennium, BlueCrest in push to Dubai
Nishant Kumar – BNN Bloomberg
Balyasny Asset Management will open an office in Dubai, the latest hedge fund to expand to the emirate. The $17 billion firm will start operations in the city in the first quarter of next year, according to a person with knowledge of the matter. Balyasny is taking space in the ICD Brookfield Place and its office is initially set up to accommodate 20 people, the person said, asking not to be identified because the details are private.

Argentina cenbank debt poses ‘systemic risk’ to financial sector, Moody’s says
Argentina’s rising central bank debt poses a risk to the country’s monetary stability, ratings agency Moody’s said on Wednesday, adding it could further stoke inflation and aggravate any exchange rate shock if savers flee from the local peso currency. In that scenario, Moody’s warned, authorities could even freeze peso deposits, an extreme measure which would bring back memories of the infamous “corralito” restrictions during the 2001 crisis that aimed to prevent a run on the banks.

Allianz CEO Sees ‘Huge Opportunity’ in China Asset Management
Allianz SE sees a “huge opportunity” from asset management in China because the nation needs to diversify overseas investments, its chief executive officer said. Chinese investors need to diversify, which requires advice on how to invest in Europe or US credit markets, CEO Oliver Baete said in an interview with Bloomberg Television at the New Economy Forum in Singapore. “I think we can add a lot of value to that.”

Goldman Payout Shows #MeToo Message Failed to Sink In; The Wall Street firm might have saved in excess of $12 million had executives accepted that vulgar comments have no place at work.
Sarah Green Carmichael – Bloomberg
So, Goldman Sachs Group Inc. CEO David Solomon is alleged to have bragged to colleagues about receiving oral sex. Several other men at Goldman were accused of making dismissive or boorish remarks about female co-workers, including discussing their weight, apparent fitness levels and the necklines of their clothing. These disturbing incidents come from a Bloomberg News report Tuesday revealing that Goldman paid ” well over $12 million” to a female executive who objected to the toxic environment created by senior men at the firm.

Paying With British Pounds Hasn’t Been This Popular Since 2016; Proportion of payments in sterling surged over recent months; Dollar, euro still most widely used payment currencies: SWIFT
Benjamin Purvis and Alexandre Tanzi – Bloomberg
Bank customers are the most enthusiastic about using the British pound for global payments since mid-2016, around the same time the UK voted to quit the European Union. The proportion of global payments made using sterling has surged to 7.845% of the total in October, up almost 2 percentage points since June, according to data from the Society for Worldwide Interbank Financial Telecommunications, known as SWIFT.

Wells Fargo, HSBC Add Offshore Yuan to Blockchain Foreign-Exchange System
Jamie Crawley – CoinDesk
Wells Fargo (WFC) and HSBC (HSBC) expanded their blockchain-based system for settling foreign exchange transactions to include the offshore yuan. The addition of the Chinese currency that circulates outside of the mainland marks the first expansion of the network, which uses a shared ledger to settle matched foreign-exchange transactions.

Qontigo licenses STOXX benchmark for ESG investing in China to PSBC
Qontigo, a global provider of indices and analytics and part of Deutsche Börse Group, has licensed the STOXX PSBC China A ESG Index to Postal Savings Bank of China (PSBC). The index serves as an underlying for an onshore wealth management vehicle launched by PSBC. The index applies an ESG score, exclusionary screens, and incorporates Qontigo’s quantitative portfolio construction tools.

German Banks’ Crypto Interest Is Limited as Industry Is Plagued by ‘Crooks,’ Regulator Says
Jack Schickler – CoinDesk
German banks have seen limited interest in handling crypto, the President of Germany’s financial regulator Bafin, said in an interview published Thursday, adding that financial innovation attracted “freeloaders and crooks.” German is one of the first countries to require banks to hold a license to deal in crypto, but Mark Branson, who also sits on the board of the supervision arm at the European Central Bank (ECB), said it has only issued four licenses for crypto custody and 14 provisional permits.

Deutsche Bank’s DWS CEO Questions Brand’s Pull Outside Germany; Hoops questioned decision to rebrand asset manager in 2017; DWS CEO set to outline his strategy at investor day next month
Eyk Henning and Steven Arons – Bloomberg
DWS Group’s new boss has put plenty under the microscope in his first five months at the asset manager — including its name. Chief Executive Officer Stefan Hoops has discussed whether the firm’s DWS branding is holding it back with international investors and even recently questioned the decision to change the firm’s name from Deutsche Asset Management in 2017, according to people with knowledge of the talks.

Wellness Exchange

BA.5 is no longer dominant in the U.S. for the first time since July, as two new subvariants take over
Aria Bendix – NBC News
Two new omicron subvariants have overtaken BA.5 as the prevailing versions of the coronavirus in the U.S. BA.5 became dominant in July, then consistently accounted for the majority of new Covid infections until last week. But data from the Centers for Disease Control and Prevention published Friday showed that the new subvariants – called BQ.1.1 and BQ.1 – have taken over. The two together make up around 44% of new Covid infections, whereas BA.5 makes up just 30%.

Before FTX collapse, founder poured millions into pandemic prevention; Most of those initiatives have come to a sudden halt.
Dan Diamond – The Washington Post
When the coronavirus pandemic hit and the world shut down in the spring of 2020, many mourned the loss of life, jobs and normalcy. Sam Bankman-Fried, then a 28-year-old cryptocurrency entrepreneur, and his brother Gabe, a 25-year-old congressional staffer, said the pandemic provided them with something else: an opportunity to make a difference. Harnessing the enormous wealth created by FTX, the cryptocurrency exchange that Sam Bankman-Fried had founded, they undertook a project to spend potentially billions of dollars on pandemic prevention, a long-neglected priority on Capitol Hill even amid the coronavirus crisis.

Is Effective Altruism to Blame for Sam Bankman-Fried?
Eric Levitz – Intelligencer
Ten years ago, William MacAskill came to MIT in search of converts. The Scottish philosopher was already one of the world’s most prominent proponents of “effective altruism” (or “EA”), a social movement dedicated to âEUR‹âEUR‹”using evidence and reason to figure out how to benefit others as much as possible.” In 2012, MacAskill believed that many idealistic young people had misconceptions about how they could best improve the world. Specifically, such individuals had a tendency to seek low-paying jobs at philanthropies and progressive nonprofits even though, in many cases, such institutions had no great need for their labor.

Ebola Shots Donated by Merck to Be Tested on Vaccine-Resistant Strain
Immanual John Milton – Bloomberg
Ebola vaccine that Merck & Co. donated to an international immunization group will be part of a trial testing three shots against a resistant strain of the deadly virus that’s spreading in Uganda. The vaccine, now licensed to the International AIDS Vaccine Initiative in New York, was recommended for testing alongside experimental shots from the Washington-based Sabin Vaccine Institute and the University of Oxford’s Jenner Institute, the World Health Organization said Wednesday in a statement. The worldwide health agency will run the trial in cooperation with Uganda’s Ministry of Health, which accepted the WHO recommendation.

Doctors Are Running Out of Antibody Drugs to Treat Covid as Virus Mutates; BQ.1, BQ.1.1 and XBB threaten to outrun scant remaining drugs; Viral evolution poses a challenge for drugmakers, scientists
Madison Muller – Bloomberg
Covid-19’s constant mutations have proven nearly impossible for drugmakers to keep up with. Omicron’s newest stepchildren threaten to render the last two antibody drugs on the market ineffective: Eli Lilly & Co.’s bebtelovimab, which is used to treat symptoms, and AstraZeneca Plc’s Evusheld, which helps prevent infections. When Covid first hit, scientists quickly developed antibody drugs to protect people from the virus’s worst effects. It’s a straightforward premise: a targeted antibody can immediately neutralize a threat inside the body, preventing an infection from even starting.

‘Vast’ mass of microbes being released by melting glaciers; Bacteria can fertilise ecosystems but need to be studied closely to identify potential pathogens, scientists say
Damian Carrington – The Guardian
Hundreds of thousands of tonnes of bacteria are being released by melting glaciers, a study has shown. The microbes being washed downstream could fertilise ecosystems, the researchers said, but needed to be much better studied to identify any potential pathogens. The scientists said the rapid melting of the ice by the climate crisis meant the glaciers and the unique microbial ecosystems they harboured were “dying before our eyes”, leaving researchers racing to understand them before they disappeared.

Youth sports rebound to pre-pandemic levels
Jeff Tracy and Kendall Baker – Axios
Youth sports participation has finally climbed back to pre-pandemic levels, per the Aspen Institute’s annual State of Play report, which surveys youth sports parents. Children ages 5 to 18 are spending 16.6 hours playing sports each week, the most since before the outbreak of COVID-19


Russia’s economy enters recession with 4% contraction; Western sanctions after invasion of Ukraine contribute to sharpest downturn since pandemic
Daria Mosolova in London – Financial Times
Russia’s economy contracted for the second quarter in a row as the western response to Moscow’s invasion of Ukraine helped plunge the economy into recession. Russia’s gross domestic product fell by 4 per cent year-on-year in the three months to October, according to preliminary data released by the federal statistics service Rosstat.

China’s Virus Cases Surge to Near 20,000 in Test for Covid Zero
China’s daily virus tally surged to almost 20,000, with enduring outbreaks in key cities testing local authorities’ appetite to ease the burden of Covid Zero restrictions while getting infections under control. The country reported 19,609 cases for Tuesday, the highest since late-April when financial hub Shanghai was in the midst of a brutal two-month lockdown. The southern manufacturing hub of Guangzhou remains the biggest hotspot, with 6,296 new infections. Chongqing posted a slight decline in numbers, but reported cases held above 2,000 for a third day.

Global Demand for Biofuel Offers Opportunity for Australia; Rising food costs spur debate on use of crops for energy; Demand for sustainable aviation fuel and diesel to surge
Sybilla Gross – Bloomberg
Strong growth in global demand for renewable fuels offers a great opportunity for suppliers in Australia, the second-largest exporter of canola seed, according to one of the country’s biggest crop shippers. While the US is the largest market, “we are seeing very strong growth across Asian markets and into China, and I think it creates a great opportunity for Australia given our geographic proximity,” Robert Spurway, chief executive officer of GrainCorp Ltd., said in an interview.

Race to launch Hong Kong’s first retail crypto futures ETF begins; The narrow range of permissible assets is expected to make competition particularly fierce
Ernest Chan, – Finanial Times
Exchange traded fund providers are busy working towards submitting applications to launch retail-oriented crypto futures ETFs after the local regulator announced it would open the door to such products. Being among the first to list a retail crypto futures ETF on the local bourse will be particularly critical to the success of the product, given the narrow range of permissible underlying assets outlined in a Securities and Futures Commission circular, experts said.

Europe Needs to Stay Vigilant on Conserving Energy, Engie Says; While situation improved, gas price volatility seen continuing; Mild October weather helped Europe refill gas inventories
Stephen Stapczynski, Alfred Cang, and Abhishek Vishnoi – Bloomberg
Europe shouldn’t let its guard down on conserving energy despite the recent drop in natural gas prices and success in refilling inventories, according to the region’s top operator of gas infrastructure. “We are in a better situation, but that doesn’t mean we should relax,” Catherine MacGregor, chief executive officer of Engie SA, said at the Bloomberg New Economy Forum in Singapore. “On prices, one can expect continued volatility.”


Twitter under Musk shows ‘the unwinding of a person’ not a company: Scott Galloway
Marketing Professor Scott Galloway breaks down layoffs in the tech world and says recent chaos at Twitter reflects the unraveling of Elon Musk more than the company at large.

Chain-Smoking Marathon Runner Finishes Race in Under 3.5 Hours
Madison Williams – Sports Illustrated
A 50-year-old runner from China completed the Xin’anjiang Marathon in Jiande in three hours and 28 minutes while chain-smoking an entire pack of cigarettes this month. A photo of the runner, who goes by the name “Uncle Chen,” went viral on the Chinese social media app Weibo showing the runner with a cigarette in his mouth while running. It is definitely a sight not many people are used to seeing. Despite his smoking during the marathon, Uncle Chen finished 574th out of more than 1,500 runners with his time.

Hemp-Fed Cows Get Buzzed, Study Finds, but Will Humans Who Drink Their Milk? Hemp with high THC content given to Holsteins leached into their milk, according to a group of German scientists exploring the food chain for dairy production.
Andrew Jacobs – The New York Times
Do cows that consume cannabis act goofy, get the munchies and spend more time lolling about with their stoned buddies? It may sound like the beginning of a bad joke, but German researchers seeking to understand the effects of feeding dairy cows THC, the psychoactive compound found in industrial hemp, made a few intriguing discoveries, according to a study published this week in the journal Nature Food.

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