Plus — Nigerians are being told they can only withdraw $45 a day from cash machines... and it's got something to do with its struggling central bank digital currency.
Before we delve into the latest twists and turns at FTX, some interesting news about EthereumMax. A judge has thrown out a lawsuit that accused Kim Kardashian and Floyd Mayweather of misleading investors by endorsing the altcoin. EMAX — which has nothing to do with Ethereum, the world's second-largest digital asset — has fallen by 99.82% from an all-time high set in May 2021. The court ruled that plaintiffs suing the A-listers couldn't prove whether they had actually seen their ads on social media. Kim K was paid $250,000 to post about EthereumMax on Instagram, with British regulators saying her financial promotion may have had the "single biggest audience reach in history." She paid a $1.26m fine to the SEC earlier this year.
Prosecutors are examining whether Sam Bankman-Fried's empire helped cause the implosion of Terraform Labs and LUNA earlier this year, according to The New York Times. Tens of billions of dollars was wiped from the crypto markets when UST, an algorithmic stablecoin, lost its peg to the dollar — causing a bank run on LUNA in the process. Reports suggest SBF's trading firm Alameda Research had placed "big bets" on the price of LUNA falling that didn't pay off. It's claimed that this caused loans taken out by Alameda to be called in — prompting it to borrow customer funds that FTX allegedly had no legal right to lend. All of this comes as a criminal investigation into the exchange's demise continues in The Bahamas.
Over in Congress, U.S. politicians are determined to get answers from Bankman-Fried. Maxine Waters has said the House Financial Services Committee may issue a subpoena if the embattled crypto entrepreneur fails to testify on Tuesday. Meanwhile, the Democratic chairman of the Senate Banking Committee has officially invited SBF to appear at a hearing next Wednesday. In a letter to FTX's founder, Senator Sherrod Brown said the 30-year-old "must answer" questions about the "clear misuse of funds" at his exchange. SBF has been given a deadline of 5pm today to confirm his attendance — and Brown warned he is willing to issue a subpoena "to compel his testimony" if he fails to do so.
Nigerians can now only withdraw $45 a day from ATMs — with officials attempting to boost adoption of its flagging central bank digital currency. The new policy, which caps weekly withdrawals at $225, comes five months after the Central Bank of Nigeria's governor criticized local financial institutions for failing to support the eNaira. This CBDC was introduced to the country of 211 million in October 2021, but less than 1% of its citizens are yet to embrace it. Corporations are limited to withdrawals about five times larger than individuals, and banks are being threatened with "severe sanctions" for "aiding and abetting" circumvention of the policy. Banks there fear the CBDC will hit their profitability and cut them off from customers.