🐻 Why is the crypto market up? 👀

GM. This is Web3 Seems Legit, your source for the juiciest gossip in crypto. We got you covered on all the latest tea so you’ll never feel like the awkward one left out of the crypto convo 😉.

This week was a mixed bag of skittles 🌈. We had a lot of greens from the marketing pumping, but also plenty of reds and yellows from more crypto companies crumbling. Here’s a tl;dr of this issue:

• Why is the crypto market up? US inflation numbers are trending down and degen traders are trending back up.

• Nexo investigated for money laundering. One of the last standing crypto lenders is being investigated for a slew of financial crimes.

• The SEC goes after Gemini and Genesis. The battle to return customer funds continues but is now complicated by the new SEC charges.

• In other news: NFT influencer gets tied up in a phishing scandal and Twitter prepares to launch digital coins.

Why is the crypto market up? 🚀 

WAGMI folks. After months of red, we’re finally seeing green again as the whole crypto market pushes into a mini rally.

Bitcoin hasn’t seen $20,000 since the FTX fallout in November, but thanks to the Federal Reserve’s latest CPI report, we were finally able to break the bottom. December’s inflation comes in at the expected 6.5%, down from 7.1% the previous month. This is the sixth straight month in a row that CPI has cooled, implying that the Feds may finally start slowing the excessive interest rate increases.

This optimistic outlook has gotten investors excited, so much so that it’s starting to bring back their inner degen. Among the top altcoin gainers this past week was $FTT. Yup, bankrupt FTX’s native coin pumped up over +40% this past week for no good reason other than just reckless trading.

We can’t lie though, it does feel good to be back and have a little taste of peak crypto 2021 again 😌.

Nexo investigated for money laundering 🚓

This next scoop is one that feels overdue. After popular crypto lending companies like Celsius, Blockfi and Voyager filed for bankruptcy, we all assumed this product category was dead. Nexo has somehow been hanging on, but probably not for long.

Last week, news broke that Bulgarian prosecutors raided Nexo's 600-people office in Sofia and charged four individuals. Crimes being investigated include money laundering, financing foreign terrorists, organized crime and more. Oof, suddenly Elon’s Twitter takeover looks like child's play compared to Nexo’s raid.

And like straight out of a playbook, what happens next is the expected bank run. As soon as word got out, Nexo customers fled to withdraw their assets from the platform. You would think that people would have learned their lesson by now 🤷‍♀️.

Nevertheless, Nexo responds to the breaking story and denies all accusations. According to them, the police raid is a “politically motivated” act.

Meanwhile, crypto Twitter has been resurfacing some old Nexo ads, specifically from popular crypto media publication, Bankless. Apparently, the media corp was paid $250,000 / month to promote Nexo. So that's what customer funds were being used for...

With all this Nexo FUD, we’re expecting the bankruptcy announcement to drop in the coming week. So if it’s not obvious enough already folks, get your coins off all crypto platforms and exchanges.

Trust us, peace of mind is priceless. That's why we recommend a cold wallet like Ledger to store your crypto safely and away from CEX scammers.

The SEC goes after Gemini and Genesis 🚩

If you’ve been following our newsletter, you would know that we’ve been closely tracking the developing story between Gemini, Genesis and DCG. Here’s a quick recap:

• DCG is a holding company that owns Genesis, a crypto trading firm that provides lending services to companies like Gemini.

• Gemini gives their customer’s assets to Genesis who loans it out for interest.

• When 3AC collapsed, DCG helped “bail out” Genesis by offering a $1.1 billion loan. We now know that it was all fugazi.

• Gemini is now pressuring Genesis to return $900 million that belongs to their customers, but they can’t do that until DCG pays them the $1.1 billion first.

This entanglement has all caused a very public fight between the CEOs on Twitter with one calling the other out.

Now the SEC is getting involved by placing charges on both Gemini and Genesis for selling unregistered securities.

According to our favorite crypto police, Gary Gensler (SEC Chair), “Genesis and Gemini raised billions of dollars’ worth of crypto assets from hundreds of thousands of investors”.

So what does this mean for Gemini customers who are still waiting to get their funds back? Well, Gemini CEO publishes a response and reassures their customers that returning funds is still their main priority.

But if the SEC wins the case, Gemini and Genesis will be charged a fine, which will likely reduce the amount of assets that customers will get back.

On top of that, some crypto Twitter folks have been calling out the SEC for the rather odd timing. Why charge them now after the Earn program has ended? Why focus on this case rather than more important issues?

Meanwhile, Barry Silbert (CEO of DCG) is just staying quiet in the corner now and avoiding all eye contact 👀.

In other news 🗞️

Twitter Coins is coming, but will Musk incorporate Dogecoin?

No matter how smart you are, no one is ever safe from hacks and phishing attacks.

Former FTX US president writes a lengthy tweet about his time at the bankrupt company and insights on SBF. Seems like people are just trying to distance themselves from anything SBF related.

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