The Return of ICOs and SPACs

Initial Coin Offerings Stage a Comeback in Crypto’s Latest Bull Run

You know it’s a true crypto bull market when ICOs, or initial coin offerings, are generating buzz again.

ICOs are a way of fundraising in which crypto startups sell new cryptocurrencies directly to investors, usually in exchange for another token such as Bitcoin or Ether. The once-popular method of raising capital — ICOs peaked at about $3 billion a month in January 2018 — is making a comeback after all but disappearing. For example, investment platform Echo helped projects raise more than $17 million in funding rounds so far in December, more than double November’s $7.2 million, according to data aggregated by user sealaunch on Dune Analytics.

North Korean Hackers Stole Record $1.3 Billion in Crypto in 2024

North Korea-linked hackers stole more from cryptocurrency platforms this year than ever before, according to Chainalysis Inc., showcasing rising capabilities that researchers say threaten US national security.

Digital thieves linked to North Korea utilize advanced methods such as manipulating remote work opportunities and are responsible for more than half of the total $2.2 billion stolen from platforms in 2024, the blockchain analytics company said in a report Thursday. North Korean-affiliated groups stole $1.34 billion in 47 incidents 2024, up from $660.5 million across 20 incidents in 2023, according to the company’s findings.

After twelve years of writing about bitcoin, here’s how my thinking has changed

If you want to buy some bitcoins, go right ahead. We can even help by regulating the trading venues to make it safe. But don’t force others to play.

Alas, that seems to be where we are headed. There is a growing effort to arm-twist the rest of society into joining in by having governments acquire bitcoins, in the U.S.’s case a Strategic Bitcoin Reserve. The U.S. government has never entered the World Series of Poker. Nor has it gone to Vegas to bet billions to tax payer funds on roulette or built a strategic Powerball ticket reserve, but it appears to be genuinely entertaining the idea of rolling the dice on Bitcoin.

Bitcoin is an incredibly infectious early-bird game, one that after sixteen years continues to find a constant stream of new recruits. How contagious? I originally estimated in a 2022 post, “Three potential paths for the price of bitcoin,” that adoption wouldn’t rise above 10%-15% of the global population, but I may have been underestimating its transmissibility. My worry is that calls for government support will only accelerate as more voters, government officials, and bureaucrats catch the orange coin mind virus and act on it. It begins with a small strategic reserve of a few billion dollars. It ends with the Department of Bitcoin Price Appreciation being allocated 50% of yearly tax revenues to make the number go up, to the detriment of infrastructure like roads, hospitals, and law enforcement. At that point we’ve entered a dystopia in which society rapidly deteriorates because we’ve all become obsessed on a bet.  

SPAC Kings Who Delivered 99% Losses Are Raising Billions Again

There are many well-established symbols of the froth building, yet again, in financial markets. There’s Bitcoin hovering around $100,000 or the Nasdaq hitting record high after record high or, for that matter, the wild bidding war that broke out in Manhattan the other day for the banana-and-duct tape “art.”

But there’s also this: the SPAC, and its band of patrons and peddlers, is back.

Howard Lutnick, the CEO of brokerage Cantor Fitzgerald LP and Donald Trump’s nominee for commerce secretary, raised a $100 million blank check in August and then, days before the elections, filed for what would be a 10th SPAC; Michael Klein pooled $287.5 million in May; and Harry Sloan and Eli Baker’s Eagle Equity Partners debuted its ninth SPAC in late October.

In total, 50 special-purpose acquisition companies have raised $8.7 billion since April, more than double the amount raised in all of 2023, according to data from SPAC Research.

Fraud Case Tied to $100 Million NJ Deli Ends in Guilty Pleas

The last two defendants charged with scheming to inflate the value of a small New Jersey deli to more than $100 million pleaded guilty to fraud charges, a year after the ringleader of the plot confessed.

Peter Coker Sr. and his son Peter Coker Jr. entered their pleas to securities fraud and conspiracy to commit securities fraud on Thursday before a federal judge in Camden, New Jersey, prosecutors said in a statement. They face as long as 20 years in prison and a $5 million fine at sentencing next year.

“Your Hometown Deli” in Paulsboro, New Jersey, became infamous on Wall Street when David Einhorn of Greenlight Capital highlighted the business in an April 2021 letter to investors as an example of irrational exuberance in the market. Einhorn noted that the deli barely had sales of $20,000 in 2019 and even less in 2020 despite reaching a nine-figure valuation in its SPAC merger with a bioplastics startup.

More Men Are Addicted to the ‘Crack Cocaine’ of the Stock Market

A new type of addict is showing up at Gamblers Anonymous meetings across the country: investors hooked on the market’s riskiest trades.

At Gamblers Anonymous in the Murray Hill neighborhood of Manhattan, one man called options “the crack cocaine” of the stock market. Another said he faced hundreds of thousands of dollars in trading losses after borrowing from a loan shark to double down on stocks. And one young man brought his mom and girlfriend to celebrate one year since his last bet.

They were among a group of about 60 people, almost all men, who sat in rows of metal folding chairs in a crowded church basement that evening. Some shared their struggle with addiction—not on sports apps or at Las Vegas casinos—but using brokerage apps like Robinhood.