44 Billion Reasons
Elon and Twitter are back at it again. And yesterday was an absolutely brutal day for the crypto community. Plus, some thoughts on a fairly big announcement yesterday and a lot of Musk gifs.
Did you guys hear Elon is buying Twitter again? Well, maybe he is. I have no idea what to make of this situation at this point. On Monday, Musk said he would once again attempt to buy Twitter (TWTR) for $44 billion. Despite my desire to publish something about it here at that time, my spidey-senses were tingling - smart in hindsight. The news didn’t stop the market from going HAM though.
Shares were halted because of the volatility. Before the news on Monday, Twitter was trading at $42 per share. A $44 billion price tag equates to $54.20 per share - which presented quite the price arbitrage. But over the last couple days, Twitter bulls have started to give some of those gains from the Musk pop back. It isn’t all bad news though. Yesterday, the Wall Street Journal noted that the banks that are supposed to help Musk facilitate this transaction are going to lose $500 million if the deal goes through:
As is typical in leveraged buyouts, the banks planned to unload the debt rather than hold it on their books, but a decline in markets since April means that if they did so now they would be on the hook for losses that could run into the hundreds of millions, according to people familiar with the matter.
I don’t think they have much to worry about personally because I still don’t know how this deal is going to get finalized. Musk and Twitter’s teams were in court yesterday and there were some interesting details that came out of it. Like this one according to the (admittedly not awesome) Washington Post:
Musk attorney Alex Spiro said in a statement Thursday that “Twitter offered Mr. Musk billions off the transaction price” but Musk “refused because Twitter attempted to put certain self-serving conditions on the deal.” He didn’t elaborate on what those conditions were.
So to recap:
Musk complained about Twitter’s bot problem on Twitter (something that is clearly a problem)
Musk then offered to buy Twitter to take the company private and fix the platform (something that I absolutely agree needs to happen)
Musk tried to get out of the deal because of the bot problem
To be fair to Musk, it is obvious to any user on the platform at this point that not only are the bots a problem, but the company is probably being selective in how it policies them. Case in point, following the news on Monday that Musk would honor the deal weird stuff has started happening again with follower counts:
Martenson is just one example, but I saw others mentioning the same throughout the day yesterday. There is something shady going on at that company regarding user account numbers. It’s obvious. But anyway, Musk finagling his way out of the deal seems to be something Twitter is still very afraid of judging from what Twitter’s attorney called “an invitation to further mischief and delay” if the deal is allowed to be delayed any further. The court ordered the deal closed by October 28th. Something else that spiked as a result of the renewed talks between Musk and Twitter was everyone’s favorite joke crypto, Dogecoin. Because why not?
Speaking of crypto…
Yesterday was a pretty awful day for crypto for a variety of reasons. First, Binance Smart Chain (BNB-USD) experienced an exploit that resulted in 2 million BNB tokens getting taken out of what appears to be a cross-chain bridge vulnerability of some sort. The heist would have been valued at nearly $600 million if Binance hadn’t shut down the chain for a brief period while the team assessed the damage and closed some gaps. In the end, the hacker made off with a little over $110 million.
While not a security breach that can easily be quantified today, we also learned yesterday that Gizmodo published a court filing from the Celsius (CEL-USD) bankruptcy proceedings. That filing is over 14,500 pages of Celsius’ customer data and it’s pretty bad; full names, balances, transaction dates, and in some cases physical addresses. In addition to kicking a lot of these customers while they’re down by doxing them after they’ve already been rug-pulled, it’s also a rather significant potential security breach for the people in the document. As readers who have been here for awhile might know, I was previously a user of Celsius - and yes, I found my name in the document.
Fortunately, all it had was my zeroed out balances and my address was redacted. I don’t see my ETH or BTC wallets or anything that could be leveraged against me. The only thing you’d ever learn about me from looking at it is which shitcoins I was generating yield on before I pulled the funds. I’ll save you the pain of the search: I had USDC, BTC, ETH, LTC, DASH, and CEL on Celsius Network. All of it was pulled before the company went bust and my physical address was redacted. So I guess I’m good?
Speaking of pot…
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