Crypto Exchange Bitstamp Turns 11 and BendDAO faces a bankrun

By I-HODL | A Crypto Journey | 22 Aug 2022


Hello, my friends, it's a new work week and this is the trending news in the world of crypto:

  • Cryptocurrency exchange Bitstamp celebrates its 11th birthday
  • Dogecoin founders at odds again
  • Decentralized protocol BendDAO faces a bankrun
  • Crypto critic Peter Schiff  predicts a slew of incoming lawsuits as a result of losses from crypto investing and trading

Bitstamp turns 11

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Image source: Flickr

Birthday greetings are in order today for Bitstamp, the world's longest standing cryptocurrency exchange. Today, Bitstamp turns 11. Wow. 11 is indeed a long time to survive as an exchange in this sector, and I guess it signals at least some level of consistency in a space where many other stars have blazed and died.

In 2011, when there was a whole lot less hype about Bitcoin in particular, cryptocurrency in general, the founders of Bitstamp- Slovenian entrepreneurs, Damijan Merlak and Nejc Kodrič- risked it all and set up business exchanging virtual currencies in their garage. It was a risk that paid off and brought them tremendous returns until they sold to pan European investment firm, NXMH, in 2018. Now that's something, right?

This is not to say that the path to success was not without hurdles. In 2015, the exchange was forced to suspend services after employees were hacked for $5 million, a miniscule amount in comparison to hacks today, but quite a significant hit, to be sure, in 2015. Nonetheless, the company recovered, weathered the storm, and is here today. 

Happy birthday to Bitstamp! This is certainly a bright spot in an otherwise bleak day for the cryptocommunity. 

And, of course, sleuthing as I try to do from time to time, I went to the founders' socials just to see if they'd say something about this day which, in essence, could have changed the trajectory of their lives, right?

Unfortunately, while I did unearth some timely jewels mulling through Merlak's account, he hasn't posted anything about Bitstamp to date and Kodrič appears to use social media even less. Notwithstanding, this was an interesting tweet from Merlak eight months ago. I only wish he'd update it.

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Merlak and Kodrič's relationship is far less contentious, on social media at least, than that of the co-founders of meme cryptocurrency, Dogecoin. Over in the DOGE camp though, the founders are freezing each other out, or at least one founder is freezing the other out, as Billy Markus has taken the step to block former friend and colleague, Jackson Palmer.  And it appears that the root of their differences lie in their diverging points of view about crypto.  Now that, my friends, is certainly a parting of the ways.

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BendDAO faces bank run

Anyways, in other news, popular blue-chip NFTs, Bored Ape Yacht Club have landed in hot waters as the threat of liquidation of loomed for holders  who used their NFTs as collateral for loans on decentralized lending protocol BendDAO where users were allowed to use NFTs as collateral for Ethereum loans valued up to approximately 40% of the NFTs floor price. 

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Screenshot of APE #8817

With market prices plunging, the floor price for the NFTs also plummeted, causing BendDAO to face a bank run, its wallet briefly holding less than one WETH on early Monday,  and with some lenders worrying about whether they would be able to recoup their deposits. It should be noted though that this number has since climbed to more than 500 ETH at the time of writing, still far below its holdings of around 18,000 ETH a mere three days ago. This is certainly an concerning development for the NFT sector, in particular, as an implosion here can have implications for NFTs in the entire crypto space, and particularly the ETH ecosystem. 

Peter Schiff predicts a slew of incoming crypto lawsuits 

American stockbroker Peter Schiff has made no secret of his disdain for cryptocurrencies. In fact, he thinks it's all a bubble or rather, a scam that's going to go to zero one day. And so, with billionaire Mark Cuban facing a lawsuit for allegedly promoting a crypto Ponzi scheme in his purported support for Voyager Digital's crypto products, Peter Schiff has taken to social media to say, in essence, I told you so.

For those of you who may not know, Voyager Digital is a cryptocurrency exchange which filed for bankruptcy last month after suspending trading, deposits, withdrawals, etc., a move which impacted an estimated 3.5 million customers, some of whom had in excess of $1 million invested, when the market plummeted  in the last quarter following the spectacular LUNA/ UST crash.

And so, Peter Schiff is focusing on Mark Cuban who he says was an early Bitcoin critic who "only flipped when he saw an opportunity to profit from the crypto mania". 

Well, friends, that's it for today. But what do you think of all these developments?

  • Do you think that it's fair for investors, trading in a space where they are constantly warned about the volatility of its products and about the critical importance of conducting their own research and not simply taking a billionaire's word for it, for example, and reminded of the need to take ownership of their crypto coins (not your wallet, not your crypto) should now target Cuban as the reason for their investment decisions?
  • Also, on the Dogecoin spat, I am all for protecting one's energy and space, I get it. But doesn't the move by Markus to block Palmer ring a bit childish?
  • And finally, as it relates to BendDAO, what do you think the implications of this development will be for NFT trading in the future? I'd love to hear your views. 

Anyways, I'm off again, scouting for other stories. Until we meet again, please remember to be safe. Arrivederci!

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I-HODL
I-HODL

Your friendly, neighborhood crypto enthusiast.


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