Autor Cointelegraph By Ciaran Lyons

Court filings reveal Celsius will run out of money by October

Embattled crypto lender Celsius Network is on track to run out of money by October, according to the firm’s latest Chapter 11 documents.Filed on Aug. 14 to the U.S. Bankruptcy Court of the Southern District of New York, Celsius highlighted that it is expected to reach negative liquidity by October 2022 to approximately $34 million. The lending platform, which held the trust of many across the world with life savings and retirement funds, was revealed to be in a much worse financial position than originally suggested in July. Court documents revealed this week that Celsius’ three-month cash flow forecast, which shows steep declining liquidity, indicates the company will experience an approximate 80% drop in liquidity funds from August to September. The forecast predicts Celsius will continue to report a negative cash flow and, by October, completely run out of money. Over the next three months, the company is expected to accumulate a negative net cash flow of $137.2 million. Previous court documents revealed that Celsius “operates one of the largest mining enterprises in the United States” and prior to filing for bankruptcy, had expansion plans to “mine Bitcoin by acquiring and making operational additional mining rigs.”Last week many got very upset with me as I said @CelsiusNetwork would run out of money & solutions needed to be acted upon faster. I was told I don’t understand Chapter 11. They have now confirmed they run out of money by October. https://t.co/CyzjgKpId7 pic.twitter.com/vBIRIGEmG2— Simon Dixon (Beware Impersonators) (@SimonDixonTwitt) August 15, 2022These findings come after Reuters reported last month that the struggling crypto lending platform was approved by U.S. Bankruptcy judge Martin Glenn to build a new Bitcoin mining facility using existing funds up to the amount of $3.7 million, with an additional amount of $1.5 million approved to be spent on “customs and duties on imported Bitcoin mining rigs.”The document stated that Celsius is mining approximately 14.2 BTC per day, owning 80,850 mining rigs, in which 43,632 were operational. Despite the alarming numbers that their cash flow forecast suggests, the amount of Bitcoin the company predicts it will mine each year is more promising. Having mined a total of 3,114 BTC in 2021, Celsius projected mining more than 10,100 BTC in 2022, with a steady rise to 15,000 BTC in 2023.Despite Celsius continuing their mining activities, it has ceased monetizing the Bitcoin generated upon filing Chapter 11 petitions, with the company now being “financially constrained.”Celsius is yet to release a monthly statement on its website. The most recent statement the company released on July 13 was a disclosure that their “strong and experienced team” had voluntarily filed for a Chapter 11. The company kept the dire news positive, reasoning that it is “to provide the company with the opportunity to stabilize its business” to “maximize value for all stakeholders.”The reaction on social media has been mixed, with some people on Twitter staying hopeful that the Celsius recovery plan “will be very attractive” to users and others suggesting that the price of CEL could hit $100. Some firmly believe that Celsius can recover, despite what the cash flow suggests, with one user stating that Celsius is earning $8.5 million monthly from Bitcoin, adding that Celsius will “return stronger.”Related: Celsius Network coin report shows a balance gap of $2.85 billionWith many speculating on the future of Celsius and potential buyers, Reuters reported last week that Ripple Labs is “interested in potentially purchasing assets of bankrupt crypto lender Celsius network.”Cointelegraph reached out to Ripple Labs to gain evidence on the claims. However, Ripple Labs only confirmed previous reports, noting that the company is “interested in learning about Celsius and its assets and whether any could be relevant to our business.” While Ripple Labs didn’t disclose if it was going to be purchasing Celsius, the company highlighted the fact that it “has continued to grow exponentially through a market reset and is actively looking for M&A opportunities to scale the company strategically.”Goldman Sachs is allegedly “considering” assisting an investor in raising the required capital to purchase the digital assets tied up with the struggling lender, according to a June 24 article.However, a source stressed that Goldman has no intention of owning the digital assets but more so to act on behalf of the investor as the broker.

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Ready Player One gave us the misconception that the Metaverse is VR — Everyrealm CEO, KBW 2022

Everyrealm CEO Janine Yorio has dispelled misconceptions that the Metaverse can only be presented “exclusively in VR.” Speaking on Aug. 9 during Korean Blockchain Week 2022, Yorio told an audience in Seoul that Steven Spielberg’s Ready Player One had given us a glimpse into what life could be like if we were living in the metaverse. However, the movie gives us this misconception about the metaverse because “the protagonist is wearing a VR headset”, she argues, despite most developments in the metaverse currently being “developed for your desktop” according to Janine Yorio. Yorio highlighted that consumer preferences has been the reason behind this, as the way humans like to “interact with technology” is “18 inches from your face, not three inches from your face” adding that “way more people have computers than have VR headsets.”Yorio highlighted that the idea of the metaverse being exclusively in VR is unrealistic, saying that while Ready Player One showed us that this “immersive photo real environment” was an exciting concept, it isn’t going to happen in the “near term future” as it isn’t how humans are used to interacting with technology. The Everyrealm executive suggested that the metaverse being “exclusively in VR ” contradicts how humans are used to using technology, which is generally multi-tasking or used to “procrastinate”, whereas “when you’re using VR you have to check out of life entirely.” We can expect the next “12 to 36 months” to be the most exciting time for the Metaverse, said Yorio, noting this will be the time “when a lot of the triple A gaming studios…are actually going to start building and delivering the kind of metaverse” that people are looking forward to.After this major shift in development happens this is when we can expect “mainstream adoption […] the moment we’re all waiting for” she explained. During the presentation, Yorio also shared Everyrealm’s project plans in the near future with a focus on fashion as it is “one of the private primary driving drivers of commerce.” Metaverse users will be able to look forward to having a look-alike avatar that they can dress with clothing from different designers […] as we strongly believe that fashion will move the metaverse forward.”Everyrealm is not prioritizing building music concerts in the metaverse as the idea of “concerts in the metaverse” is “terrible.” We go to live shows to get the “bass” feeling in our feet and “being with friends and actually dancing and you can’t do any of that…but the pandemic made us a little bit more forgiving of what a concert can be.”

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Victorian police to get 'greater power' to seize crypto assets from criminals

Victorian Police in Australia will soon be granted new powers to seize cryptocurrency and digital assets from criminals, as well as compel platforms to hand over information about suspects.According to a statement released by Victorian premier Daniel Andrews on Aug. 2, new laws were introduced to parliament on Tuesday under the Major Crime and Community Safety Legislation Amendment Bill 2022, with the aim of cracking down on organized crime in the state.The new bill is expected to give authorities “greater power” to identify and seize digital assets, in response to the growing use of digital cryptocurrencies by organized crime.The laws will uphold also require crypto exchanges disclose information to assist with criminal investigations in the same way that banks would. “They will be able to compel cryptocurrency platforms to hand over information about suspects like banks currently must, and seize digital ‘wallets’.”It will also give police greater search powers to obtain electronic data when executing search warrants and make the criminal’s “forfeited property” more easily available to compensate victims of the crime. Speaking to Cointelegraph, Michael Bacina, a digital asset specialist at Piper Alderman, said that as the wording of the Bill has not yet been made public, one of the challenges he sees is around legislating for digital assets when it cuts across state and federal borders. “A challenge of legislating for digital assets is that state jurisdiction often stops at the border, so ensuring there is consistency of approach between different states and countries, is paramount.”Bacina also noted that police will need “proper training in the technology of seizure and securing private keys of digital wallets,” but also noted that criminals transacting in digital assets “provides a valuable tool for police in combatting crime, as transactions leave an immutable trail of evidence on a public ledger which is extraordinarily difficult to alter after the fact.”Victorian Minister for Police, Anthony Carbines acknowledged that criminals are evolving their strategies, noting “we need to be just as quick in empowering our police to respond to new ways of offending.”Related: 74% of public agencies feel under-equipped for crypto investigations: ReportEarlier this year, popular crypto monitoring tool, Chainalysis estimates that at least $10 billion worth of cryptocurrency is held by wallet addresses associated with illicit activity as of early 2022. Bacina however noted that the analytics firm also reports that illicit usage is at its lowest proportion in the crypto asset ecosystem, “so further reducing the illicit usage of digital assets can only instill greater confidence in the digital asset and cryptocurrency ecosystem.”

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Mental health support prime for decentralization, say academics

Decentralized mental health services could be the answer to the looming shortage of mental health professionals, according to professors from John Hopkins University based in Baltimore.Speaking to Cointelegraph, Dr. Johannes Thrul from the John Hopkins School of Mental Health postulated that the mental health support sector could take a page from Decentralized Autonomous Organizations (DAOs) by offering support services in a decentralized system.Dr. Thrul authored a July 22 academic paper looking into “Web3 and digital mental health,” envisioning a decentralized peer support system that relies on “individuals with lived experience” to provide help “based on their expertise in managing their own conditions.” Dr Thrul said the system would work by using a “crypto token tied to the community” which would be rewarded to those that “make positive contributions to the community,” such as helping someone overcome a mental health issue in a peer support enviroment. During a time when I find myself worried and anxious about the state of the world, it was fun to work on this genuinely positive and uplifting opinion article on the potential of web3 and online peer support for mental health. https://t.co/rEngiaOL3S— Johannes Thrul (@drjthrul) July 22, 2022He said the system would not be bound to “border restrictions” noting how quickly governments adapted to remote delivery of health services during the COVID-19 pandemic, though he admitted it could not replace the mainstream medical system alone. Instead, it could be used to supplement seeing a traditional psychologist.Another professor who contributed to the academic paper, Dr. Luke Kalb said a decentralized peer support system will provide more flexibility and freedom to how we approach mental health issues, stating:“[The] community can come up with their own creative ways to tackle problems […] this peer support system opens up to so many opportunities for creativity.”The professors noted that such a system may become essential in the future given the likelihood of a shortage of traditional mental health services in the future with “61% of practicing psychiatrists in the U.S. are nearing retirement.”Related: Mental health and crypto: How does volatility effect well-being?The paper also cited research by The Department of Health and Human Services which projects “a protracted national workforce shortage in all mental health professionals by 2025.”Although the professors have just begun the early stages of research, they are hoping to start building the necessary professional relationships to see this happen. Dr. Thrul said, “it’s tough finding the right technical partnership with the same shared vision […] however we want to put this out there and as a call to read, rally, and reach out.”

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Australian regulator trials auto take-down of crypto scam sites

Cybersecurity specialists have welcomed a new trial by the Australian Competition and Consumer Commission (ACCC) to automatically take down scam websites. The trial saw dozens of scam sites, including crypto scams, knocked offline after more than 300 were reported.The ACCC reported that Australians had lost $113 million in cryptocurrency scams last year. The new trial will be in partnership with the Australian Securities and Investment Commission (ASIC) and will focus on efficiently removing scam websites once they have been reported to Australian regulators, to protect potential investors from falling victim to crypto fraud.The ACCC is using a countermeasures service from the UK-based Netcraft, which has been providing a similar service for the past four years to the UK’s National Cyber Security Centre.According to an IT News report, sites already taken down include “phishing sites impersonating Australian businesses and government authorities,” along with “puppy scams, shoe scams, cryptocurrency investment scams and tech support scams”. Ken Gamble, Executive Chairman of private intelligence firm IFW Global, praised the development. He told Cointelegraph this is “the best news he has heard” as he had “seen the damage these sites made by sophisticated fraudsters have done using state of the art digital marketing techniques.”“These crypto scam websites are unregulated, organized by criminal groups, many residing in Eastern Europe, who operate call centers, taking millions from mums and dads across the world every day.”Gamble said that Australian government agencies also need to be open to collaborating with the private sector to see real success.“We need law enforcement involved and collaborate with different countries […] many of these major cryptocurrency exchanges aren’t helpful with fraud investigations, making our investigations a lot harder than necessary”.Researchers and romantics bewareGamble said that individuals researching cryptocurrency are often targeted with Facebook advertisements “luring them in” with “Hollywood style professional videos” convincing them how easy it is to make money. “If somebody is wanting to invest $10,000 into cryptocurrency, they should spend $1,000 doing due diligence checks to ensure it is a legitimate platform […] if it turns out to be a scam, it will be the best $1,000 they will have ever spent.”He said those investing in cryptocurrency should do their own due diligence as many websites clone bigger companies to scam potential investors. He said potential investors at a bare minimum should “do checks to make sure the platform is regulated, with all the correct financial license numbers.”A representative from Cyber Trace, a team of private investigators specializing in cryptocurrency fraud, told the Cointelegraph that “romance baiting” is the most common cryptocurrency scam. This involves victims talking to a romantic interest online who helps them sign up to a major cryptocurrency exchange, after telling the victim they have made “great returns on investment.” The fraudster will then ask the victim to send “a small amount of up to $200” to their platform, where “they will fiddle around the numbers on their end to show the victim they have already made a profit, offering them to withdraw this amount to gain their trust.”Once the victim sees how easy it is to make a profit and withdraw their funds, they begin to invest “more and more… and don’t get much out after that point.”

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