Another Crypto Firm Collapses, Microsoft Slashes Workforce, Fake Cannabis Billionaire Pleads Guilty: Top Stories For Thursday, Jan. 19


Another Crypto Firm Collapses

  • Beleaguered crypto lender Genesis Global Capital, the cryptocurrency lending unit of Digital Currency Group (DCG), could file for bankruptcy as soon as this week.
  • Genesis fell into a liquidity crunch and halted redemptions shortly after revealing on Nov. 10 that it had $175 million locked in an FTX (FTT/USD) trading account.
  • The company warned investors that it might need to file for bankruptcy if its efforts to raise $1 billion in a fresh capital fail.

Texas AG: Citigroup Discriminates 'Against Firearms Sector'

  • Citigroup Inc C has reportedly discriminated against the firearms sector, the office of Texas Attorney General Ken Paxton said, making a decision that "has the effect" of halting the bank's ability to underwrite most municipal bond offerings in Texas.
  • Citigroup will not be allowed to underwrite debt in Texas, one of the nation's largest public bond markets.

Business Insider

Elon Musk's Twitter Isn't Done Laying Off Workers

  • Elon Musk-led Twitter reportedly has plans to terminate 50 workers in its product division in the coming weeks.
  • The layoffs will come in the coming weeks.
  • Twitter employees expect the company's plans to close many international and smaller offices within the United States will lead to more pink slips.


CoinDesk Ropes In Lazard To Advise Sale

  • Coinbase Global, Inc COIN hired Lazard, Ltd LAZ advisors as it explored a potential sale that would remove it from Barry Silbert's Digital Currency Group (DCG).
  • CEO Kevin Worth's email acknowledged receiving numerous inbound indications of interest in CoinDesk.
  • Worth said Lazard would help CoinDesk explore various options to attract growth capital to the CoinDesk business, which may include a partial or complete sale.

Financial Times

Semafor Weighs Options To Buy FTX Founder's Interest, Biggest Outside Backer

  • Semafor is in the early stages of working out how to raise the money to repurchase Sam Bankman-Fried's position in the media startup, founded by former Bloomberg and New York Times executives.
  • FTX (FTT/USD) cryptocurrency exchange founder Bankman-Fried contributed more than a third of the $25 million in initial funding for the venture launched by Justin Smith, the former Bloomberg Media chief executive, and Ben Smith, the ex-New York Times columnist.

Peter Thiel Cashed Out Big On Bitcoin Bet Just Before Market Crash

  • Peter Thiel's venture capital firm Founders Fund has cashed out on its eight-year investment in Bitcoin (BTC/USD). 
  • This comes a month after Thiel extolled the benefits of Bitcoin at a Miami conference.
  • According to a source close to the fund, the firm had sold off the vast majority of its crypto holdings by March 2022, generating $1.8 billion in the process.


Microsoft-Backed ChatGPT Outsourced Content Moderation To Kenyan Workers At Below $2/Hour, Investigation Finds

  • ChatGPT creator OpenAI reportedly used Kenyan laborers for less than $2 per hour to make its artificial intelligence-powered chatbot less toxic.
  • To sniff out toxic language, the AI needed to be fed samples of violence, hate speech, and sexual abuse so that such instances could be filtered out using an inbuilt detector.
  • To get those labels, OpenAI reportedly sent thousands of text snippets to an outsourcing company in Kenya starting in November 2021, with examples that included child sexual abuse, bestiality, murder, and suicide.

Microsoft Slashes Workforce After Denying Layoff Plans

  • Microsoft Corp MSFT has announced plans to strengthen its business in response to macroeconomic pressures, including 10,000 layoffs. 
  • Microsoft said it would take a series of actions to reinforce its business in response to macro conditions and changing customer priorities. The plans include a workforce reduction, changes to the company's hardware portfolio, and lease consolidation.
  • The news comes just one day after the tech giant reportedly denied reports of impending layoffs, calling them a "rumor." 

Crypto Platform Bitzlato Alleged For Money Laundering Of Over $700M

  • The US Treasury Department designated cryptocurrency exchange Bitzlato Ltd as a "primary money laundering concern" under a section of the USA Patriot Act for allegedly laundering illicit funds for ransomware actors based in Russia. 
  • Hong Kong-based Bitzlato exchanged more than $700 million in cryptocurrency with Hydra Market, a darknet marketplace.
  • Bitzlato also received more than $15 million of ransomware proceeds, the Justice Department said.

Cramer Slams Crypto Markets After Genesis Bankruptcy Report: 'Truly A Sham'

  • Jim Cramer, the host of CNBC's Mad Money, slammed cryptocurrency markets again on Wednesday, calling them "truly a sham." 
  • Cramer said his personal favorite news of Wednesday was that crypto firm Genesis is reportedly planning to file for bankruptcy.
  • In December, Cramer said he cashed out his crypto investments last year and bought a farm with the earnings. Now he's wondering if the entire space is just one big con.

Fake Cannabis Billionaire Pleads Guilty To $35M Fraud Scam

  • Justin Costello, who posed as a billionaire, a wounded Special Forces Iraq War veteran, and a legal cannabis investor, pleaded guilty to securities fraud in a Seattle federal court Wednesday.
  • The guilty plea came several months after an FBI SWAT team arrested Costello in a remote area of southern California where he was carrying a backpack containing gold bars, $70,000 in U.S. and Mexican currency, and a fake ID.

Gillette Maker Procter & Gamble's Q2 Revenue Tops Estimate By A Whisker; Bottom-Line Matches Street View

  • Procter & Gamble Co PG reported a second-quarter FY23 sales decline of 1% year-on-year to $20.77 billion, marginally beating the consensus of $20.73 billion.
  • Organic sales increased 5%, driven by a 10% increase from higher pricing and a 1% increase from a favorable product mix, partially offset by a 6% decrease in shipment volume.
  • Sales in the Beauty segment fell by 3%, the Grooming segment contracted by 9%, and Health Care rose by 2%.
  • Adjusted EPS of $1.59 was in-line with the analyst consensus.
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