This Week in the News - November 14th

1. The FTX fire is still ablaze. This week FTX filed for chapter 11 bankruptcy and CEO Sam Bankman-Fried resigned. Recent news has sent cryptocurrencies plunging and has wiped out millions of dollars in wealth! (source)

2. Chorus of Lawmakers Collectively call for Crypto Controls in FTX Fallout–In addition to rattling the markets this week, the collapse of FTC also grabbed the attention of various US lawmakers. This tragedy had resulted in the conclusion that much stricter regulation of the crypto industry is needed. Our biggest question here is whether regulation has exposed the weaker reserve and risk management practices? One would like to think that having regulations in place would have strongly disincentivized the poor risk management but the damage has been done. Where do we go from here? (source)

3. Zelle Tax Loophole utilized by Small Businesses, costing IRS BILLIONS Annually! – Independent contractors and small businesses may have found a loophole to to reporting income through Zelle, a popular bank-to -bank payment service. Zelle does not hold funds, in fact all funds transferred are normally deposited within a matter of minutes. Due to its setup, Zelle claims its payments are not subject to the new IRS tax rule effective Jan 1 2022.The thresholds for transaction reporting have significantly decreased, under the new tax rule, third party payment processors must issue 1099-K forms to any users receiving more that ‘$600 in payments via their apps and also file them directly with the IRS.’ By no means are we advocating the game of cheating your taxes. Regardless of what the IRS rule technically says, all business owners and independent contractors alike should be very wary of assuming they can simply dodge taxes by using Zelle as opposed to a third party service like PayPal. (source)

4. HOT NEWS! Binance CEO Zhao Pushes for Crypto Self-Custody; Trust Wallet Token Soars 80% to record. – Zhao’s apparent push for self-custody comes as investors are forced to rethink how to best keep their assets safe amidst FTX’s collapse and following hack that nearly drained $600m worth of coins from individual wallets. In the wake of recent events we imagine the preference for self-custody among investors will only increase. (source)

5. 4,500 Doxed Tokensoft Users, a Rush on Cold Storage Wallets: Where’s the Silver Lining? (source)

6. Crypto Markets need regulation to avoid more washouts like FTX, says Coinbase CEO Brian Armstrong (source)