Here’s what happened in crypto today Lido DAO is the center of a class action lawsuit claiming the decentralized autonomous organization duped the public into investing in an unregistered securities offering.Meanwhile, spot Bitcoin ETFs could trigger unwanted consequences for crypto exchanges like Coinbase due to lower transaction fees, ETF analysts have said, and crypto exchange FTX paid $118.1 million in fees to bankruptcy lawyers and advisers between August and October.Class action lawsuit against Lido DAO filed in California A former Lido investor has filed a class action lawsuit against the Lido decentralized autonomous organization (DAO) over allegations that it operates an unregistered security and is liable for plaintiffs’ losses during crypto winter.The lawsuit, which was filed in a San Francisco District Court on Dec.17, blames Lido DAO for dumping tokens on unsuspecting investors during the depths of the bear market.
Per the filing, Lido DAO began as a “general partnership” comprised of institutional investors, before deciding to capitalize on a “potential ‘exit’ opportunity” by selling Lido tokens to the public.The filing backs up its claim of Lido being an unregistered security by channeling comments from Securities and Exchange Commission Chair Gary Gensler.Per the filing, the Lido token is controlled by “a group in the middle […] and the public is anticipating profits based on that group.” Lido has more than $19 billion worth of crypto locked in its contracts, making it the largest liquid staking derivative platform on the market, according to DeFiLlama.Spot Bitcoin ETF will be ‘bloodbath’ for crypto exchanges, analyst says While the crypto community eagerly awaits the possible approval of a spot Bitcoin exchange-traded fund (ETF) in the United States, some analysts are warning this could potentially trigger unwanted consequences for cryptocurrency exchanges.Several industry observers have predicted that a spot BTC ETF could start trading in early 2024, in an event that, when paired with Bitcoin’s upcoming block reward halving expected in April, Blockstream CEO Adam Back believes could propel BTC to $100,000.
Bitcoin proponents such as Jan3 CEO Samson Mow have said that approval of a spot Bitcoin ETF in the U.S.could even drive Bitcoin as high as $1 million in the “days to weeks” following.But the forecast isn’t that optimistic for centralized cryptocurrency exchanges, according to ETF Store president Nate Geraci and Bloomberg ETF analyst Eric Balchunas.Once approved, a potential spot Bitcoin ETF in the U.S.would be a “bloodbath” for cryptocurrency exchanges, Geraci wrote on X (formerly Twitter) on Dec.17.
According to Geraci, retail spot Bitcoin ETF buyers and sellers will benefit from underlying institutional trade execution and commissions.On the other hand, retail users of crypto exchanges will get “retail trade execution and commissions,” Geraci noted, stressing that those will need to improve to compete with a spot Bitcoin ETF.Bloomberg ETF analyst Eric Balchunas emphasized that a spot Bitcoin ETF will cost 0.01% to trade, which is the average fee for ETF trading.In contrast, trading costs on exchanges like Coinbase reach 0.6%, depending on the cryptocurrency, transaction size and trading pairs.
Once approved, a spot Bitcoin ETF will create more price competition in the crypto industry, bringing money back to investors from exchanges that spend massive amounts of cash to advertise their services at events like the Super Bowl, Balchunas believes.FTX loses $53K every hour on ‘bankruptcy fees’ — latest filings show Crypto exchange FTX has been burning through approximately $53,000 every hour over the three months ending Oct.31 — just on bankruptcy lawyers and advisers, the latest round of compensation filings show.Court filings from Dec.
5 to Dec.16 have shown that the bankruptcy lawyers have charged an accumulated total of at least $118.1 million between Aug.1 and Oct.31.
Over the 92 days, this equates to $1.3 million per day or $53,300 per hour.Jameson Lopp@loppDec 17, 2023 Latest numbers from the FTX bankruptcy are interesting: Customer shortfall: $1.422 Billion Bankruptcy fees: $1.45 Billion pic.twitter.com/FhCtFPeQ3z Meanwhile, an earlier report filed on Dec.
5 by the court-appointed fee examiner, Katherine Stadler, identified “significant areas of concern” with the billings submitted by the larger advisory firms, including Sullivan and Cromwell, Alvarez and Marshall, and others between May 1 and June 31.“The Fee Examiner identified apparently top-heavy staffing, apparently excessive meeting attendance, fees related to non-working travel time, and various technical and procedural deficiencies with respect to some time entries (including vague and lumped entries),” wrote the report regarding the billings submitted by Alvarez and Marshall.
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