Tag Archives: FTX

Crypto contagion triggers global banking crisis

Posted on by

To those who say crypto was just a bystander in this now global banking collapse, they are lying. Crypto is entirely fake, and was the trigger for this banking meltdown. Crypto has been in meltdown mode since Terra/Luna last May, then FTX last November. Banks that were heavily involved in crypto are now the first to go under, which has set off an industry panic and crisis of confidence in big banking.

The greater issue of the insolvency of the big banks, who all hold devalued treasury bonds, has been caused by the same policy that crashed crypto– a decade of free money followed by a sharp interest rate rise by the Federal Reserve. There is a connection there.

The EU (and everyone else) follow from the US Fed, since dollars are the international exchange currency and have been since the end of WW2. But increasingly, dollar dominance is being called into question by many different interests, particularly the government of China, hence the constant US propaganda campaign to demonize China & embolden fascist racist filth.

What we are witnessing now is a complete breakdown of the post-war monetary system. The Bretton Woods system of US dominance was established in 1945, by the winners. Richard Nixon took the US off the gold standard in 1971, because Fort Knox was running out of gold to convert into dollars at $35/ounce. Since then, all currencies float against the US dollar. All international settlements, particularly oil, are done in dollars. This is what makes the US dollar almighty.

Stagflation of the 1970’s, then Fed chairman Paul Volcker’s interest rate hikes in the 1980’s, which reached nearly 20%, enriched banks. Big corporations even started their own lines of credit cards to cash in for themselves. It was the best of times to be rich, as Reagan/Bush are revered for their conservatism on issues like global warming, and their enthusiasm for corporate & banking deregulation, etc.

In 1987, the first stock market crash in America’s post-war era (which took every bourgeois economist by surprise) established the “Fed put”, which ensured a taxpayer bailout for any bank or corporation deemed “too big to fail.” Timeline ahead: Asian tiger crash in 1998, dot com crash in 2001, and then the big one– the sub-prime mortgage collapse in 2008. All caused by corporate criminality. All the big fish got bailed out.

By 2010, the Fed started printing money and gave it away to all its cronies for over a decade. Every other central bank in the world followed suit. By the end of 2021, after a few abortive attempts (Dec 2020 – March 2021, most notably) at quantitative tightening, the Fed has taken a hard line on raising interest rates to induce a recession and quell workers wage demands.

Inflation is caused by massively increasing the supply of money, without having the economic fundamentals to back it. By ‘economic fundamentals’ I mean, actual (real world) use value. The Fed, Wall Street, the White House & US Congress all believe that inflation is caused by workers’ wages going up. That’s the class war that’s always raging underneath the fake news.

With capitalism in its speculative death throes, crypto has emerged as the libertarian answer to the international currency question. As far a being real money, you can buy lots of black market things with bitcoin. Things you can’t do with crypto include: pay rent, pay credit card, pay taxes… pay for a Big Mac. It simply has no value to the vast majority, and therefore must be abolished.

Trotskyists are the only ones who have taken this intolerant policy towards crypto from the start. The SEC, DOJ, & White House have now pivoted to an anti-crypto policy since the Silvergate Bank collapse less than two weeks ago.

Slivergate CEO Alan Lane, second from right, rings the New York Stock Exchange opening bell before his bank’s IPO begins trading, on Nov. 7, 2019.

There’s been lots of talk about making depositors whole, making sure small businesses can make payroll, etc, in the wake of these US bank collapses, triggered by crypto’s meltdown. Everyone knows the FDIC guarantees accounts up to $250,000. For businesses with more than that, there is the Deposit Insurance Fund, which is a privately-owned, industry-sponsored insurance program.

The DIF’s purpose is to 1) insure bank accounts over $250K, and 2) resolve failed banks. If crypto start-ups like Circle ($3.3B in SVB) didn’t hedge with DIF and can’t make their payroll, etc, then the CEOs of these companies need to pay out of their own pockets– or else go bankrupt. Poor risk-management is on the CEO/CFO, and NOT the responsibility of the US taxpayers.

Why didn’t these smart tech companies with million$ & billion$ in venture capital money have a DIF policy to protect against a bank collapse? Corporate Leadership 101– FAIL. NO bank bailouts!

…………………….<><><><><><><>………………….

Silicon Valley Bank collapses, crypto under intense price pressure

Posted on by

Two days ago Silvergate Bank was the largest US bank failure since 2008. That has now been surpassed by the shutdown of what was earlier-in-the-week the 16th-largest US bank, Silicon Valley Bank.

Sam Bankman-Fried on Silvergate’s website: “Life as a crypto firm can be divided up into before Silvergate and after Silvergate. It’s hard to overstate how much it revolutionized banking for blockchain companies.”

Satoshi Nakamoto’s bitcoin was put online in 2009, and still today no one knows who this guy is, or where all that Mt Gox bitcoin went. But today there are now two distinct eras in the history of post-Mt Gox crypto– FTX and post-FTX. Silvergate was the key crypto bank for the entire US industry and it just died Wednesday evening, March 8, 2023. It died from a malignant case of FTX.

Now Silicon Valley Bank has been shuttered by California state regulators due to mass discrepancies between what they can prove they have, and what they claim they have, etc. Stablecoin issuer Circle said late Friday that $3.3 billion in cash deposits remained at Silicon Valley Bank. According to Circle, this sum represents ~8% of the total reserves ($40 billion) backing Circle’s stablecoin USDC.

Stablecoins attempt to peg their market value to fiat currency 1:1. This means one US dollar (Euro, etc) ALWAYS equals one stablecoin. Tether is the top stablecoin, while Circle’s USDC is the second-largest stablecoin on the market. Stablecoins are now considered to be fundamental elements of the crypto ecosystem.

But the validity of stablecoins has been seriously called into question, especially since the Terra/Luna collapse in May 2022. Binance is also a big stablecoin issuer, and they have been forced to admit that their BUSD token hasn’t always maintained its 1:1 peg, like it’s supposed to be for people to trust. Where does the money go?

The Federal Reserve has sought to stifle worker wage increase demands by inducing a recession through its policy of raising interest rates. Note that this only increases inflation, which the ruling class is purportedly fighting. The Fed’s fight against “inflation” is actually a corporate-mandated attack on workers’ wages. It’s another example of Orwellian doublespeak in the fake media.

Unfortunately for the Federal Reserve Bank, this raising of interest rates has collapsed the crypto industry which relies on free money. Venture capitalists, hedge funds, blank check companies, and FDIC-banks have thrown trillions dollars into crypto which is now going bankrupt everywhere because it is expensive, wasteful & useless.

Binance CEO Changpeng Zhao, a Canadian citizen living somewhere in the far East, has been avoiding & deflecting accusations contained in investigative reports from Forbes and The Wall Street Journal recently, claiming that Binance’s math is fuzzy and their books don’t balance. CZ’s Twitter responses were more rhetoric about FUD, fake media attacks, etc, providing no evidence to contradict investigator claims.

It’s comparable to when Seymour Hersh published his Nord Stream bombshell, and no one in the US political establishment (or fake media) could mount a serious response to refute his claims. Eventually, most thinking people took that to mean that Seymour Hersh was correct and that the terrorist US government is lying again.

Somehow, all these realities, facts & nuances get lost in translation through the filters of fake news. Big crypto is secretly negotiating their next bailout with US officials. That is how the White House has been “monitoring the situation” in crypto since the Silvergate Bank collapse.

Crypto is one big hustle & dodge that is running out of time & money. Bitcoin is now under intense pressure, as the latest CoinDesk headlines reads, “Bitcoin Regains $20K After $200M in Crypto Liquidations; Some Traders signaling strength for [Circle’s] USD Coin, citing its treasury backing in U.S.-issued bonds.”

These are clear signals to elite Traders to bet that US taxpayers will pay for any crypto-connected bank bailouts, etc. As far as market manipulators go, crypto whale Elon Musk is having to burn through a lot of bitcoin these days to keep its price inflated at $20K. Musk is running out of Tesla stock to sell and companies to destroy. If Elon Musk doesn’t get a big bailout soon, the richest person in the world will go bankrupt.

…………<><><><><><><><><><>…………..

Bankrupt crypto bank Silvergate gets $4.3B US taxpayer bailout

Posted on by

It was reported last week that Silvergate Bank, the bankrupt crypto lender with FDIC affiliation (a rarity in the industry), received a $4.3B bailout from the San Francisco-based Federal Home Loan Bank, following the collapse of crypto exchange FTX, according to the firm’s Q4, 2022 filings.

US taxpayers, without their consent, have just bailed out this bankrupt crypto bank– and it barely made the news. Silvergate was the first, of what is to be many bailouts for crypto. As much as the crypto community howls about “de-fi, privacy & freedom”; it needs a bailout even more. Industry players have been angling for this since the FTX collapse.

To review, Silvergate provided banking services to crypto exchanges & investors, with ~90% of its deposits from crypto. Silvergate’s 10 biggest depositors, include bankrupt firms such as: Coinbase, Paxos, Crypto.com, Gemini, Kraken, Bitstamp & Circle. As a result of the FTX collapse in November, Silvergate was bankrupt, as it held worthless deposits for both FTX & Alameda Research.

Market manipulation is what is driving the current bitcoin bounce. This, along with venture capital, is what is sustaining the crypto industry on life support. Market manipulation through wash trading, and other pump & dump tactics are the rule in crypto. Wash trading is when a firm trades with itself to artificially boost prices, to give the illusion of liquidity & generate interest from investors. A recent paper from the National Bureau of Economic Research found that wash trades accounted for 50-70% of all crypto transactions, suggesting most trades on these platforms are fraudulent.

For example: bitcoin’s price had been languishing at ~$17K for weeks, but as of last week it has slowly been going up. Bitcoin currently sits at over $21K, and no one can explain why, as investors are leaving the industry in droves, lay-offs are everywhere, and hardly a day goes by without some news of another crypto firm, exchange, bank, etc, having liquidity issues. So where is all this money coming from? As it turns out, it’s now coming from the taxpayers.

Update: Sat 21 Jan 2023 5:50 AM CST

Silvergate Bank ($4.3B), Signature Bank ($11.3B), Provident Bancorp ($80M), and Ally Financial ($7.2B) have been bailed out by the Federal Home Loan Banks program, which is ostensibly meant to fund home loans. This is surely the tip of the iceberg as there are many others we don’t know about– yet. US taxpayers support FHLB financing, as their bonds are implicitly backed by Congress, which would not allow a default, hence their AAA rating from Moody. Should one of these crypto-friendly banks fail, FDIC accounts would be second in line, after the FHLB, in claims resolution. Banks always get bailed out first. Bloggers are the only ones reporting this story, as the corporate media is maintaining silence on this massive & secret crypto bailout scheme.

…………..<><><><><><><>………….

Is Sam Bankman-Fried now an agent of US Intelligence?

Posted on by

The conspiracy theory that SBF is now an agent of US intelligence is supported by the facts and his actions since pleading “not guilty” in a Manhattan courtroom. The DOJ normally takes no prisoners in its prosecutions, unless a secret deal has been reached.

From a historical perspective, the DOJ investigations of Donald Trump have been as restrained a legal action as you will ever see, because he’s so connected to right-wing militias (which intelligence agencies view as an asset), but the DOJ still went after him to some extent for his malfeasance. SBF has the same criminal credentials, but with even more value to US intelligence, so he’s been treated with kid gloves by the DOJ & the corporate media because they’re all tied-in to the CIA Democrats.

The dictatorship of finance capital can be clearly observed in crypto. SBF & Co. have surely made secret deals, as they are being integrated into US intelligence to help move dark money to Ukraine, etc. Thus, none of the defrauded customers will see a penny of the $5B in assets the US government has claimed to have recovered (so far) in the FTX fallout.

Republicans have now setup a new committee to bail out this distressed “asset class” known as crypto, and as a result of this activity, bitcoin has moved up by ~$2K in the past few days.

………..<><><><><><>……….

Crypto mining report

Posted on by

Mining bitcoin became less profitable in 2022 as hashrate (the electrical cost of mining bitcoin) increased, while bitcoin tumbled from an all-time high of $69K in November 2021 to under $17K at present. Crypto is being propped-up with everything the US financial system has left. There are a lot of billionaires & multi-millionaires who are VERY upset at the prospect of losing a massive chunk of the portfolio invested in crypto.

In 2022, the stock prices of the five biggest public crypto miners by hashrate: Core Scientific ($CORZ), Riot Blockchain ($RIOT), Bitfarms ($BITF), Iris Energy ($IREN), and CleanSpark ($CLSK) traded down 99%, 85%, 91%, 92% and 79%, according to CoinDesk. What’s going on in the crypto industry is a massive restructuring, with a few big fish eating all the little fish. New rationalizations are needed to reassure venture capitalists in their support for the flagging crypto industry. If investors stop giving crypto money, then it’s lights out– literally.

Miners are hardcore crypto fanatics, so they tried to hold onto the bitcoin they mined, often electing to finance operations with low-interest debt, venture capital, blank check companies, etc. Perhaps pitch the idea on Shark Tank, which coincidentally appeared around the same time as bitcoin. The point is that bitcoin mining companies, who are in the business of mining bitcoin, weren’t making the BIG money in crypto.

Miners were contracted to make money for whales, who financed the mining of bitcoin. For instance, if Elon Musk contracted a massive amount of bitcoin to be mined from various bitcoin mining companies, the bitcoin would be delivered to him while he paid the consortium of miners for the service, presumably in bitcoin. This would support the industry as long as the price of crypto went up and money was cheap from the Federal Reserve.

Elon Musk’s financial Waterloo was his commitment to buy Twitter for $44B last spring. When his bitcoin empire crashed, soon after his takeover announcement, he began to back-off on buying Twitter. By summer, when Twitter shareholders threatened to sue & win in court, Musk was beaten. Elon Musk was heralded as the wealthiest man in the world by Forbes, with a value of $264B as of 2021. So here’s a modern economic question: Why couldn’t Elon Musk just buy Twitter for $44B, and be secure w/ $200+B remaining in personal wealth? Answer: Because his wealth was never real. It was mostly inflated crypto, and you can’t buy a publicly-traded company with bitcoin. Forbes is a central player in this fictitious accounting.

Elon Musk’s choices to finance his Twitter acquisition were to A) liquidate bitcoin; or B) liquidate Tesla. Tesla is WAY overvalued, and Musk knows this better than anyone, so him selling huge shares of his flagship electric car company tells the story there. If bitcoin recovers, Elon Musk is king again. If crypto goes to zero (which it must), then Musk is dust. When the stock value of Tesla collapses, as it must, Elon Musk won’t have any real money left. The more Tesla stock Musk sells, the sooner this will happen.

As poorly as Musk has run Tesla, his short reign as Twitter CEO has been qualitatively worse. Maybe Twitter was worth only a quarter of what Musk paid for it, say $10B. But that’s still an asset, and the second-largest social media platform on the internet. At least manage it decently for awhile, then take it public again, or sell it & eat the loss. That would be a rational business strategy after making a big mistake. But instead, Musk destroyed Twitter through a series of tirades, boneheaded ideas & tantrums. Now, Twitter isn’t worth $2B. These new-age millennial entrepreneurs have trouble producing value in the real world. They always need more money.

Turning to the unending crypto saga of Sam Bankman-Fried, the Securities Commission of the Bahamas has taken custody of FTX deposits valued at more than $3.5B as of November 12, according to a media release published last week. The November 12 date is significant, because the murky, murky $383M FTX hack, live-streamed in this video, happened during the evening of November 11, while SBF was in Bahamian custody. So where is the money?

The government of the Bahamas is in complete control of $3.5B in crypto, which the US government wants for itself. Bankruptcy trials take a long time, and this is largely a jurisdictional battle for the spoils which is to be hashed-out by lawyers, financial officials, opportunists, etc, on both sides until all the money is divvied-up to the right people. This is how governments steal for themselves in the name of their people & democracy.

The crypto community is facing an existential crisis. The vast majority, who have worked to build this industry, in mining, computer programming, sales & promotion, etc, have been shucked & jived by modern-day shysters. Calls in the fake media for regulation are a smokescreen, as crypto will never be regulated by US Congress. A few years back, during the Trump administration, Facebook CEO Mark Zuckerberg was compelled to testify before the US Senate for a regulatory hearing. The most memorable moment was when a crusty septuagenarian senator asked Zuckerberg how Facebook made money? The Facebook CEO smiled to himself & replied, removing as much condescension from his voice as possible, “We sell ads, sir.”

That’s typical of the level of fundamental cluelessness in elite politics. Crypto with its blockchains, decentralized finance, off-shore shell companies, etc, is much more complex than the nuts & bolts of social media. Not only is regulation unwanted by the industry (and Republicans), it’s unthinkable because no one in bourgeois politics has a clue how to deal with this mess. No politician wants to be seen as “impeding the free market,” and no politician wants to get dragged into these crypto scandals any further. You know it’s really bad when you see corrupt politicians insisting there are returning FTX money.

Calls for “regulation” in articles discussing crypto should be always interpreted as “bailout.” Eventually this crypto bubble will burst, and unlike the sub-prime crisis of 2007-08, there are no assets to recoup here. Millions of homes with defaulted mortgages were transferred into bank ownership in the wake of the 2008 financial meltdown. This was done to make bankers & hedge fund investors (who caused the meltdown) whole again. They were too big to fail. But the soon-to-come crypto crash will leave nothing to be recouped, because it’s been a fake asset from the start. US & Bahamian regulators are fighting over custody of $3.5B in fake money, and who winds up with it is beside the point because it’s worthless.

Meanwhile, Sam Bankman-Fried is out on bond, living with his parents who are co-conspirators in the $32B FTX/Alameda swindle. The effectively altruistic boy genius came up with a better way to mine crypto. Instead of having a series of supercomputers mining the crypto by solving complex mathematical equations, SBF just made up his proprietary FTT tokens out of thin air. This saved energy costs, and the expense of contracting crypto miners. This way, SBF made super-profits! Crypto skeptics point to Binance’s native BNB token, and ask if Changpeng Zhao created them by the same process.

Sam Bankman-Fried has surely violated the terms of his bail by moving large amounts of crypto from hidden Alameda wallets after his release on bond last week. SBF denies this, of course, as his parents are there to punish him if he does anything wrong again. The problem with crypto isn’t SBF, per se, it’s capitalism & the flawed idea that you can create value from nothing.

Update: Wed Jan 4, ~8:45AM CST

SBF was allowed to be free on bond, and violate those terms by moving large amounts of crypto out of Alameda wallets to unknown accounts. Unknown to the public that is. The US government knows where the crypto is, because undoubtedly they have been monitoring his computer, but they aren’t revealing anything they know to the public which is normal. SBF is acting as a personal tutor for US intelligence agencies, etc, in how to move crypto. Notice how names are always redacted when his legal team requests it, etc. Since when has such a swindler been allowed such clout in a DOJ prosecution case? Normally, targets of the DOJ receive no mercy, unless they plead guilty– or cut a secret deal. SBF pled not guilty, yesterday, as expected. SBF should now be considered as an agent of the US state. It’s the only way he can save himself.

Final thoughts: Thu 05 Jan 2023 6:43 AM CST

The crypto community is learning the hard way, that BIGGER interests (such as the US-provoked war in Ukraine) override any claims of crypto theft. The most logical explanation for SBF’s ‘not guilty’ plea is that he made a secret deal with US intelligence to save himself. These demoralized libertarians are in WAY over their heads here.

Crypto believers have hyped bitcoin with an impressive amount of enthusiasm & bravado, but never answered any fundamental questions posed to them over the years. They display a staggering level of naivety & ignorance in the fields of economics & politics. And yet, in their collective moment of stunned disbelief over the reality of how quickly dreams can evaporate, they maintain they are correct. The Federal Reserve & US Intelligence are the primary forces keeping crypto alive. Crypto is a money-laundering tool, that’s it’s only use value.

Any talk of SBF being an asset of US intelligence will now be branded as “conspiracy theory” in the fake media.That’s the Big Lie playbook they run on the public. This conspiracy theory is backed by the facts and the events as they are unfolding, which strongly implies that it is correct. US Intelligence always lies & evades to minimize exposure of an asset, especially a big fish like SBF, who is teaching them new & better ways to move crypto. This helps Joe Biden work with Republicans in funneling funds to the neo-Nazis in Kiev in the name of fighting Russian aggression which keeps us safe from terrorism.

…………<><><><><><><>………..

Coronavirus War update: crypto collapse

Posted on by

Effective altruism has melted away and it’s been replaced by the slogan– make investors whole again! Especially the small ones, because they can least afford the losses, blah, blah, blah…

As a socialist, I feel very little sympathy for anyone in the crypto market. It’s been a scam from the start, and if you didn’t recognize that, then you deluded yourself. These fanatics are capitalists to the core, who do no productive work, and only got into crypto to make money for themselves. They look at all the odds stacked against them, while ignoring simple logic (AKA– FUD), to make themselves believe they can get something for nothing. People have to learn at some point, and while cases like Elon Musk (bitcoin whale) are beyond hopeless, those who can’t afford big financial losses in crypto are just as much part of the problem. Their fundamentalism blinds them.

These wanna-be’s envy criminals like Elon Musk, the fascist billionaire. Taking a look at his CV for just the past few weeks, Elon Musk has drained his core company Tesla, selling it’s stock at a premium before it goes bust, to finance his takeover of Twitter which has cost him tens of billions of dollars to date. He had to do this because all his bitcoin busted before he’d done any due diligence on Twitter, but after he’d committed to buying it. Some genius huh? So now, advertisers & users have abandoned what was once the 2nd-most popular social media platform, as Musk took it over and turned it into a toxic wasteland. Twitter has gone the way of MySpace, via Mein Kampf.

Even Donald Trump, who has 88 million followers on Twitter, won’t return to the platform after Elon Musk re-instated his account with much fanfare. Trump started Truth Social, his proprietary platform, on which he posts exclusively– to his 2 million followers. Donald Trump wants to be president again, yet he accepts 1/44th the social media reach, because more importantly he wants to make money for himself. Trump does this by pumping his brand. Every other industry he’s ever branded himself in has gone bankrupt, or if it’s still in existence, is under federal investigation for tax fraud or some other form of criminality.

So of course, Donald Trump has now launched his own crypto, a $99 NFT of trading cards in his image. It will be worthless in the near future, but you can still own those images & digits in cyberspace. Of course, if you keep them in a cold wallet with responsibility for your own keys, you will lose 99% of your crypto, according to Changpeng Zhao, the Binance CEO & crypto whale.

It’s tough to pass on crypto when you die because 1) the keys are hidden and hard to get to, because if they aren’t, you’ll get hacked and lose everything instantly; and 2) inheritors often aren’t familiar with the crypto world, and thus getting through all the online steps needed to liquidate can be an insurmountable task. Even with crypto exchanges such as Binance, this is an issue, but Changpeng Zhao didn’t mention that.

Some crypto industry leaders who got burned in the FTX collapse, are now calling for regulation. Crypto is deregulated finance by definition, hence the industry term “de-fi.” According to the libertarian economic model, de-fi opposes centralized finance, breaking the bounds of national banking by creating an international currency on the foundations of freedom & privacy– [* until it all collapses and they need a bailout]. What libertarians never strictly define are these emotionally-charged terms: freedom & privacy, which means they can mean anything. To SBF & Co., it means the freedom to embezzle everyone’s crypto on his exchange in the privacy of his luxury villa in the Bahamas.

That’s life in a post-modernist world, and it’s what happens when you are too lazy to strictly define important core values within the community. The ‘crypto community’ was built on vague altruistic ideals which could be changed or discarded at any time, by any actor, because those were the rules everyone allowed from the beginning. The crypto community isn’t the cooperative idealistic paradise it markets itself to be. Just about any crypto investor would steal a kajillion dollars of crypto if they thought the could get away with it. How can anyone regulate with these industry-wide ethics? Crypto has been around for only thirteen years or so, and yet its demise is imminent.

Crypto lacked a credible core philosophy to justify its existence. Ask any crypto believer, and none of them will take you any further than what I’ve just spelled out. It’s all about making money by doing no real work. These are lazy & privileged kids along with mathematical whizzes who learned computers, but got on the wrong track from the start. None of them understand the fundamental nature of money and what it represents. They just want to create an algorithm that makes money for themselves. Crypto-currency is anti-productive & anti-social to its core.

No more cheap money from the Fed, along with rising costs for electricity to mine crypto, means this fake industry is about to go tits-up. Only massive infusions of liquidity on a daily basis (from a central source) are keeping this crypto boondoggle afloat. The big hedge fund investors & venture capitalists are already lining themselves up for another bailout. Congress will have bi-partisan support for this, but the rub is the crypto industry has been so discredited in the eyes of so many people that another such corporate bailout is a tough sell politically.

The crypto industry is a joke because everyone in politics has taken money from these criminals, but none of them can clearly explain why crypto has value. The same applies to economists, industry experts, talking heads, etc. Tens of millions of dollars a day (minimum) is what is going into the crypto market to keep it “legitimate.” Cold wallets won’t save any investors because it is the crypto itself (bitcoin, ether, etc) that is worthless. Blockchains are becoming too costly to maintain due to rising energy prices. This inflation crisis has been caused by unlimited QE for over a decade, and accelerated by the disastrous official response to COVID-19, and the US-provoked war in the Ukraine.

Bitcoin’s value to the ruling classes is that it’s a tool for laundering large amounts of cash. Imperialist governments & their intelligence agencies have many uses for this, all nefarious & undemocratic. So the question of questions for SBF & Co. in the wake of the FTX/Alameda Research scandal is: Where is the money?

Where did all that crypto go? What about FTX’s ‘Aid for Ukraine’ campaign launched last spring? Where did all the aid money go? Who was/is connected to all this? Both the Democrats & Republicans have prominent figures in their upper circles who participated in this criminality. The first step in damage control is to silence SBF. His arrest in the Bahamas on Tuesday (Dec 13), after weeks of delaying, was timed to prevent his sworn testimony, via Zoom, to US Congress. Tens of millions of people would have watched that, waiting for bigmouth SBF to spill the beans on everybody. As mentioned in my last piece on FTX, this case has Jeffery Epstein-type implications, and must be handled very carefully by the ruling elite, otherwise the truth will get out and the establishment will be publicly discredited.

The crisis of capitalism has become an existential issue, so what is at stake is the ruling class’ right to rule. If politicians and their media apologists can’t convince the working people to bail out the crypto industry to avert an “economic collapse,” then the game is over. This is their greatest fear being realized, and their only answer is more lies, more attacks on living standards, and more hate & violence. That’s what happens when you start with no ethics and then become financially bankrupt.

For the ruling classes, any major wildcat strike or other form of labor shutdown can only be met with media hysteria & demonization, followed by physical attacks from right-wing goon squads aided by the police, intelligence agencies & the military. Workers & youth must organize into workplace & neighborhood committees with the goal of taking control over worker production & neighborhood safety. Uvalde proved, without a shadow of a doubt, that the cops have no interest in protecting teachers & children, etc. Productive workers & youth must organize & unite to protect each other from the propaganda & violence of all the world’s ruling classes.

The Coronavirus War concludes it’s third year with an increase in fascist propaganda & policy by every nation. In China, the origin of COVID-19 from human-animal crossover in a Wuhan wet market, the ruling bureaucracy has just ended its Zero-COVID policy which had been successful for its duration, but only within its borders. COVID-19 is a global virus that mutates constantly, and is increasingly evading vaccine immunity. US President Joe Biden has declared the pandemic over, when clearly it isn’t. Trump denied the pandemic was real, so Biden is merely following the fascist policy of his predecessor. That’s what Democrats do, as anti-science reigns supreme in the pseudo-academic, liberal, middle-class milieu that is obsessed with race, gender & sexual orientation.

This crypto collapse marks a turning point in the Coronavirus War, which up to this point the fascists (of all stripes) have been winning. Fascist ideology has long-since been rejected by the working masses of the world, while right-wing corruption rules over them. Now, fascist money is becoming increasingly worthless, which makes it harder for them to buy people. This weakness is being exposed daily, in the collapses of crypto exchanges & lenders. Crypto auditors (who love their big fee$) won’t even stand by their “all good” asset ratings anymore, deleting them from their sites, etc.

The leading industry site is Coin Desk, which is tangled-up in the FTX collapse in a myriad of ways. Fundamentally there is no honesty in their “journalism” because there are deep dark truths about crypto which they can never reveal– not even to themselves. When yet another exchange halts withdrawals, and Coin Desk reaches out to that company for a comment, it’s either 1`) No comment, unavailable, no response; or 2) public relations BS such as, “we’re working to make investors whole again… our fundamentals are sound,” etc.

So… where’s the money?

………….<><><><><><><><>………….