What’s behind the sell-off

The worst crypto crash since 2022

Author

Daniel Akpobare
August 05, 2024

 

GM Explorer,

A recent sell-off has sent the cryptocurrency market into a nosedive, and it seems Jump Crypto's massive asset transfer might be to blame!

Here’s what we got for you today:

  • 🤔 Crypto crash: What’s behind the sell-off?

  • 😱 The $6.86 Million Crypto Blunder!

  • 🧱 Around The Block: Crypto market liquidations top $197 million as Bitcoin price plunges below $60,000.

🤔 Crypto Crash: What’s Behind the Sell-Off?

A major sell-off of risky assets on Sunday has caused the cryptocurrency market to plummet in value, and it has everyone scrambling for answers.

Julian Hosp, CEO of Cake Group, points to Jump Crypto as the culprit behind the crazy sell-off!

Here’s why:

Jump Crypto, a subsidiary of Jump Trading known for holding vast amounts of Ethereum (ETH) and Solana (SOL), is reportedly unwinding its crypto operations.

And over the weekend, they transferred millions to exchanges for at least 22 hours straight!

Julian Hosp also notes that the transfers by Jump Crypto are either because the Company is getting margin called in the traditional markets and it needs liquidity over the weekend.

Or because they are stepping back from the crypto business due to regulatory issues.

And you know what? He may not be far off on the regulatory front!

Jump Crypto has been facing legal challenges related to its involvement in the collapse of TerraUSD and the Terra ecosystem back in May 2022.

The U.S. Securities and Exchange Commission (SEC), for example, is investigating Jump Crypto for its alleged role in manipulating the price of UST.

And the Commodity Futures Trading Commission (CFTC) is also investigating Jump Crypto for its trading and investment activities in the market.

These investigations could be influencing the recent sell-off; who knows?🤷‍♀️

Despite the ongoing turbulence, Jump Crypto still holds $552,510,477.47 worth of crypto assets.

😱 The $6.86 Million Crypto Blunder!

Imagine this: a surprise windfall of nearly $7 million lands in your bank account!

Sounds like a dream come true, right? Well, not so fast! Because that's what's about to put an Australian couple in jail!

In May 2021, Crypto.com mistakenly transferred a whopping 10.47 million Australian dollars (that's $6.86 million in USD) to Thevamanogari Manivel and Jatinder Singh instead of issuing a $100 refund.

How did this happen?

Well, it turns out someone entered an account number in the wrong part of an Excel sheet, and as if that wasn’t bad enough, the company took seven months to realize the error.

By that time, the couple had already gone all out, buying multiple houses and even gifting a friend $1 million.

Their excuse? Singh claimed he thought he’d won an online raffle!

But the prosecutors aren’t buying it; they are now pushing for a prison sentence for Singh, arguing that it was more than just a simple "crime of opportunity” and that he knew exactly what he was doing.

Meanwhile, Singh's lawyer argued that anyone could have misunderstood the situation, especially given that the funds came from a multinational company that didn’t notice the error right away.

Adding more drama to the situation, prosecutors suspect Singh may have been attempting to flee the country because he couldn’t get a full refund.

Singh's sentencing is set for September, while his partner, Manivel, has already served a seven-month prison sentence and is now under an 18-month community corrections order for her involvement.

Wild, right?🤯

Maybe they would have gotten off easier than this, but the thing is that this situation is happening against the backdrop of a surge in crypto-related crimes in Australia.

According to AUSTRAC, criminal use of crypto for money laundering is on the rise due to its anonymity and speed.

So, dear reader, what would you do if you found that much money in your account? Would you spend it or return it?

Check out the full story here.

🧱 Around The Block

That's all we've got for you today.

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Catch you soon.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell assets or make financial decisions.

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