The news is related to elements closer to home. The procedures and financial standing of several of its companies are under scrutiny by the parent corporation of CoinDesk, one of the initial news websites to focus on the sector.
The FTX crypto exchange had a value of hundreds of billions of dollars on November 2. Sam Bankman-Fried, its chief executive, was a multibillionaire and among the most well-known figures in the cryptocurrency community.
But that morning, the cryptocurrency-focused website CoinDesk broke a story stating that the financial stability of FTX’s sibling firm, Alameda Research, was questionable. Following that, FTX and Mr. Bankman-Fried ran into a series of issues: After the scoop, FTX and Alameda filed for bankruptcy a little more than a week later. Currently, Mr. Bankman-Fried is accused of federal fraud.
The post by Ian Allison increased awareness of and interest in CoinDesk, one of many magazines that have emerged in the last ten years to cover cryptocurrencies. Numerous publications have come under fire for allegedly glorifying the sector, especially as it reached new levels in 2020. There have been discussions regarding the independence of some, such as CoinDesk, who find themselves in the rare situation of reporting a sector that helps to finance their operations.
However, CoinDesk is now facing even more difficulties. Its parent company’s venture capital firm, Digital Currency Group, which has investments in a number of cryptocurrency initiatives, is one of the companies that has its own financial issues and operational concerns. Since FTX’s demise, there has been a wider fallout in the cryptocurrency market.
Genesis, a DCG-owned bitcoin lender, laid off 30% of its workforce this month. Additionally, on Thursday, federal authorities accused Genesis of selling unregistered assets through such a scheme that offered depositors high-interest rates. The officials claimed that without licensing the program, Genesis and Gemini Trust, a cryptocurrency exchange, collected several billion dollars in funds from dozens of thousands of investors.
The events have compelled CoinDesk to write extensively about its owners and associated events over the past few weeks.
The director of communications at Digital Currency Group, Amanda Cowie, declined to comment on the probe but stated that the firm was not involved in CoinDesk’s editorial decisions.
According to Ms. Cowie, “like any top-tier media organization, it’s essential to the industry for the main outlet to run independently.”
Right now, that means consistently tracking DCG. CoinDesk focused on layoffs at Genesis, the complaints from federal authorities against Genesis, and a long conflict between Barry Silbert, the chief executive of DCG, and Cameron Winklevoss, a co-founder of Gemini.
The significant slowdown in the cryptocurrency business was mentioned by Mr. Allison, the journalist with the big FTX scoop, who stated that it “clearly affects a media site like CoinDesk.” But I’m hoping we can keep expanding the team and offer in-depth, unbiased news on the cryptocurrency space.
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