Binance cuts costs, Ripple is ready for US banks and the return of crypto-VCs

The crackdown on crypto companies by the United States Securities and Exchange Commission (SEC) appears to have severely affected Binance’s business. Over the past few weeks, the crypto exchange has reportedly laid off over 1,000 employees and cut some benefits.

According to Binance, the “current market environment and regulatory climate” caused earnings to decline, suggesting further cuts may be on the way. A spokesperson told Cointelegraph that the company would consider reducing “certain products, business units, benefits and policies” in response to business and regulatory concerns.

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Binance still faces the courts and the 13 charges brought against it by the SEC, as well as the outcome of a U.S. Department of Justice investigation into its operations and executives.

Despite the murky outlook ahead, Binance is still comfortably the most popular centralized crypto exchange in the world, holding assets worth over $63 billion. A symbolic breakdown by DefiLlama show that the majority of assets held in Binance include Tether (USDT) (27.55%), Bitcoin (BTC) (26.95%), BNB (BNB) (12.82%) and Wrapped Ether (10.08%).

In his remarks on Binance’s anniversary on July 14, the exchange’s CEO, Changpeng Zhao, recalled that the company’s journey “has never been smooth.”

This week’s Crypto Biz examines Binance’s continued efforts to rein in declining profits, Ripple’s expectations that US banks may soon adopt XRP (XRP), and early signs of venture capital returning to crypto.

Ripple CLO claims court ruling could encourage banks to adopt XRP

Stu Alderoty, Legal Director of Ripple Labs, believes that US-based banks may turn to XRP for cross-border transactions following a recent court ruling. “Hopefully this quarter will generate a lot of conversations in the US with customers, and hopefully some of those conversations will turn into real business,” he said in an interview. With the label of “security” no longer seeming to weigh on XRP, the partnerships between Ripple and the banks that have been dragged down by the SEC lawsuit could find new life. Bank of America eyed the blockchain company in 2019, and American Express first partnered with Ripple in 2017.

Binance Cuts Employee Benefits, Citing ‘Drop In Profits’

Global cryptocurrency exchange Binance is cutting some employee benefits as part of the company’s revaluation efforts. The company has reportedly stopped offering employees reimbursement for certain expenses, including cell phone use, fitness and working from home. Binance cited “the current market environment and regulatory climate” which has led to lower earnings, suggesting that more cost-cutting measures may be needed. The report follows a massive layoff in June that affected more than 1,000 stock exchange employees. Both Binance and Zhao have been targeted by the SEC for allegedly offering unregistered securities in the United States.

Marathon shareholders file lawsuit against company’s senior management

Crypto mining company Marathon Digital is heading to court over allegations that its CEO Fred Thiel, alongside other top executives, breached his fiduciary duties, enriched himself unjustly and wasted company assets. According to the complaint, the company’s management downplayed its problems, artificially inflated Marathon’s valuation, received excessive compensation, engaged in lucrative insider selling, and received unduly high bonuses based on false and misleading statements.

Polychain Capital and Coinfund raise $350 million for new crypto funds

Web3 venture capital firms are gearing up for new investments in crypto projects as Polychain Capital raised $200 million for a new investment fund and Coinfund secured $152 million for a seed fund. Polychain still intends to raise $400 million in total for the new fund. It currently operates three funds with approximately $2.6 billion in assets under management. As for Coinfund, its CEO, Jake Brukhman, said the company had set a goal of raising $125 million, but managed to raise an additional $27 million due to renewed interest in the industry. Total VC funding volume for crypto startups was down 76% year-over-year due to the bear market and turmoil in the industry.

Before you go: Bitcoin rally will lead to a “speculative peak” in 2024, predicts Mark Yusko

BlackRock’s bid for a Bitcoin cash exchange-traded fund has sparked the start of a new crypto bull market, which will turn parabolic at some point closer to the halving scheduled for April 2024, according to Mark Yusko, chief investment officer and founder of Morgan Creek Capital.

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