Back in 2008, when US investment bank Lehman Brothers Holdings Inc. filed for bankruptcy, it reduced people’s faith in the banking system to such an extent that a new class of assets, having no support from any formal bank, came into being.
The asset was Bitcoin, which is now the most popular cryptocurrency. Bitcoin was first found in November 2008, about two months after the Lehman crisis.
While it had a beautiful run in the few years post inception, the cryptocurrency market is facing brutal times of late. Bitcoin is highly bearish and seems unable to mark a decent recovery, and has fallen by another 5% over the last 24 hours, to currently trading at $18,793.
Upon examining the current market conditions, expert investor Michael Burry has predicted a 2008-level economic crisis. He was also one of the few people who speculated about the 2008 housing and subprime mortgage crisis- which makes his prediction this time around one to pay heed to.
Why Is Burry Predicting An Economic Crisis?
Burry’s current prediction of the economic crisis is based on multiple factors. His prediction has come out following the crash in the crypto market.
Over the past week, Bitcoin has fallen by more than 8%. Despite a good response to the Ethereum merge, ETH prices still seem suppressed by bearish pressure and the asset has fallen by 9% over the last 24 hours.
Other altcoins like Dogecoin, Solana, Polkadot, MATIC, and Ethereum Classic have also fallen by 8% to 10%.
The dramatic crypto crash is not the only factor fueling Burry’s prediction. He has also highlighted the crash in the SPACs market. The Special Purpose Acquisition Company market peaked in 2021 but after that, it has been struggling enormously. He also highlighted the crash in the meme stocks.
The current inflation crisis is one of the major factors provoking the forecast. The Consumer Price Index has revealed that inflation is at record high levels despite the Federal Reserve’s efforts and involvement in quantitative tightening and interest rate hikes in order to curb it.
In the recent Jackson Hole speech, Fed chair Jerome Powell asked households and businesses to “get ready for pain” as the Fed battles inflation.
What’s Next For The Economy?
Clearly, the US economy is going through a tough phase. In addition to dealing with record inflation, the threat of a recession also clouds the economy. The market participants will be eagerly looking out for the upcoming CPI release.
The CME Fed Watch tool is currently indicating a 75% chance of another 75 bps interest rate hike. Another favorable CPI data might move the Fed’s aggressive stance.
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Max Keiser Urges SEC To Stand Against Unregistered Securities Referring To XRP
While the Ripple community is hoping to see an end for Ripple vs SEC lawsuit as soon as possible, a well known Bitcoiner, Max Keiser, stands against XRP.
In a latest Tweet, Bitcoiner Max Keiser claimed is seen quoting SEC to stand against all the unlawful inducement made by unregistered securities which he says while referring to XRP. This was made in reference to the video which was posted by an XRP user where the video is based on the reason for holding XRP.
As he referred to the video, Max Keiser pointed out XRP as centralized and urged SEC chair Gary Gensler to take the necessary action.
The Ripple vs SEC case has been running since December 2020 where the Securities and Exchange Commission charged Ripple and two of its executives for raising more than $1.3 billion through unregistered digital asset securities offering.
Meanwhile, the XRP holder’s lawyer, John Deaton, slashed Keiser’s statement as he claimed that the Bitcoiner would know XRP if he ever had the currency on his mind.
Earlier, Ethereum founder, Vitalik Buterin spoke against the XRP community where he said Ripple’s XRP has lost its trust and protection. Vitalok’s comment comes after the community compared XRP with Bitcoin and Ethereum and claimed that XRP cannot be considered as security.
Even then after Vikalik’s statement, John Deaton was seen calling his tweet as immature and referred to it as a hateful comment.
At the time of writing, XRP is selling at $0.471 with a surge of 5.76% over the last 24hrs.
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Delma is a B2B Content Marketer, Consultant, Blogger in the field of Blockchain, and Cryptocurrency. In her spare time, she loves to blog, play badminton and watch out ted talks. She likes pets and shares her free time with NGO.
Tether Strives To Regain Community Trust, Slashes Commercial Paper Holdings
In an effort to increase transparency, Tether has recruited a new accounting company to undertake routine audits and attestation reports to guarantee that its stablecoin is appropriately backed by US dollars. As of September 30, 2022, Tether, the company that issues stablecoins, had less than $50 million’s worth of commercial paper units in its portfolio.
Unsecured, short-term debt instruments known as “commercial paper” are issued by corporations. It is frequently employed to finance short-term commitments like payroll, accounts payable, and inventories. While treasury bills are touted as more reliable than commercial papers, they offer “zero default risk” because investors are assured of recouping the purchase price.
Tether’s chief technology officer Paolo Ardoino made the statement in a tweet on October 3 and added that the percentage of US Treasury bills in Tether’s overall portfolio grew to 58.1%, up 25.1% from the 43.5% it held as of June 30.
To increase the stability of its ecosystem and the USDT stablecoin, Tether stated in June that it planned to roll USDT’s commercial paper backing into short-maturity U.S. Treasury bills, eventually reducing it to “zero.”
To increase transparency and frequently provide audit and attestation reports, it recruited BDO Italia, a European accounting firm, as a new auditor to independently assess its stablecoin reserves in July.
The United States District Court in New York ordered Tether to prove that the USDT stablecoin was backed 1:1 by US dollars on September 19.
Tether is well along the way to selling off all of its holdings of commercial paper by the end of 2022, having reduced its reserves from 20 billion units in Q1 2022 to 8.4 billion units in Q2 2022.
As of the writing of this article, USDT is trading at $1, with a market value of $70,163,891,644, and a 24-hour trading volume of $41,421,937,703. There is a market supply of 67.95 billion USDT. All the indicators are displaying a bullish momentum at the moment.
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Here’s Kim Kardashian’s Net Worth After Her Whopping Rs.1.26 Million Fine to SEC
Kim Kardashian, a reality TV star and businesswoman, reportedly agreed to pay the Securities and Exchange Commission $1.26 million as part of a settlement after the public figure was charged with endorsing a cryptocurrency asset security without disclosing the compensation she received for the promotion. In addition, Kardashian must pay back the $250,000 she received with interest for publishing about EthereumMax tokens.
Without acknowledging or denying the SEC’s findings, Kardashian agreed to pay the penalties. Her attorney told the BBC that, “she wanted to get this matter behind her to avoid a protracted dispute.”
According to a report by Variety, “Kardashian fully cooperated with the SEC from the very beginning, and she remains willing to do whatever she can to assist the SEC in this matter. She wanted to get this matter behind her to avoid a protracted dispute. The agreement she reached with the SEC allows her to do that so that she can move forward with her many different business pursuits.”
Which Asset Did Kim Kardashian promote?
In June last year, Kim shared a post on Instagram and had written, “Are you guys into crypto???” and had provided a link to the EthereumMax website where investors could get information on how to buy EMAX coins. “Sharing what my friends just told me about the EthereumMax token!”, the post said, and it added the hashtag “#ad” to indicate that it was a paid advertisement.
Kim has 331 million followers as of October 4 and the star had 220 million followers when the crypto post was published in June of last year. Kardashian’s net worth, which is estimated to be $1.8 billion, will not be significantly affected. However, the SEC deal may short-term deteriorate relations with her brand partners.
The fact that the star received $250,000 through an intermediary for the post was something she chose not to disclose to her 220 million Instagram followers at the time.
The pump and dump scheme has its consequences
A Los Angeles federal court has also filed a lawsuit against Kardashian, boxing champion Floyd Mayweather, Jr. basketball player Paul Pierce, and EthereumMax for their roles in the promotion of the cryptocurrency tokens. According to the lawsuit, celebrity endorsements increased the currency’s value to over 1,300% more than its initial cost until it dropped to “an all-time low” around a month after Kardashian’s post. A New York individual who lost money after purchasing EMAX tokens filed the lawsuit in January.
The SEC Chair Gary Gensler said, “This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto-asset securities, it doesn’t mean that those investment products are right for all investors.”
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