🧃 All the JUICE from the 50-page FTX report

Gm, this is the doodhwala, the crypto newsletter that makes every day feel like a Sunday. 😎

What day is it today? T̶u̶e̶s̶d̶a̶y̶ SUNDAY! ☀️

Here's what we got for you today:

• 💀 We peeked inside FTX

• 📉 E-T-H Staking Feels the Burn

• 🚀 Smartest Contract of ‘em ALL

• 🛠 Handle EVM Calldata Like a Pro

• 🍼 Kwon Can't Cash Out ⚖️

Sunday EVERYDAY!

💀 We peeked inside FTX. It's worse than you think.

FTX’s debtors (people who lost money on FTX) just dropped a 50-page report on how the crypto exchange was managed.

And let me tell ya, your local government offices are managed better than the 2nd largest crypto exchange was.

The report described the 💩-show that was FTX in 3 words:

• “greed”

• “hubris”

• “incompetence”

🥛 Me: Alexa, what does hubris mean?

💁‍♀️ Alexa: Hubris means having excessive pride or self-confidence.

🥛 Me: Use hubris in a sentence!

💁‍♀️ Alex: Using it in a sentence – “SBF had too much hubris, so he yolo-ed customer funds and made sure no one would ever trust curly-haired vegans ever!”

But the report had some 🤣 things to say about how FTX was managed internally. (honestly, we know FTX was run badly, but this was a circus!)

1️⃣ No Auditing or accounts

FTX’s auditing and accounts department was as qualified as the doodhwala’s auditing and accounts department.

• 56 of FTX Group’s entities didn’t have any financial statements

• 35 of FTX Group’s entities used a free-accounting software called QuickBooks for accounting

• Over 80,000 transactions worth millions were unprocessed

• Accounting messages were sent via – Signal and Telegram – with disappearing messages

• Expenses were approved on Slack with emojis, for instance:

This is how the report said they were audited:

My word of the day, today, is – hodgepodge. 🤣

2️⃣ Wallet security compromised

FTX had over $10 billion in customer funds, but they didn’t know how to custody it. 💀

• Hot wallet heavy: Nearly all of the crypto funds were held in hot wallets. SBF even lied to his Twitter audience and US regulators saying FTX splits their crypto between hot and cold wallets.

• Multi-sig? F that: FTX didn’t use multi-sign wallets or multi-party computation control their crypto.

• Private keys on AWS: FTX’s private keys to crypto world billions was held on – Amazon Web Services, a cloud computing software.

When SBF was asked about tracking wallets on a Slack channel, he said (and I'm not even kidding) – "We sometimes find $50m of assets lying around that we lost track of; such is life." 🤣

3️⃣ Alameda YOLO

Remember Alameda Research?

The [evil] sister-company to FTX that borrowed all customer funds.

Yeah, that one.

It had a very very weird privilege.

• 0 dollars – how much most accounts on FTX could borrow

• $1 to $150 million – how much some preferred customers could borrow

• $65 billion – how much Alameda could withdraw

$65 BILLION!!

And that’s not all.

Alameda could withdraw dollars from FTX even if its balances were negative.

This is kinda like the “god-mode” cheat codes we’ve used in childhood video games. 🤣

4️⃣ Employees say sorry

The ones in-charge of FTX (and it’s related entities) were:

• Sam Bankman-Fried

• Nishad Singh

• Gary Wang

Looks like every college brochure, right? 🤣

Everyone else beyond these 3 who tried to make decisions were – FIRED.

People like:

→ FTX US’s President (Brett Harrison)

He had a disagreement with SBF over the management structure of FTX US + hiring key employees.

No only did FTX not listen to my guy Brett. They:

• reduced his bonus

• forced him to apologize to SBF

→ FTX Group’s lawyer

When a recently hired lawyer questioned FTX about – their corporate shitshow and poor AF risk management, he was immediately fired. 💀

5️⃣ Who tf needs a risk department?

Risk management is sort of a big deal for a crypto derivatives exchange offering high-leveraged trading of doggo coins. 🐶

But guess what?

FTX had no risk management team.

Yes, these t-shirts were a lie 👇

Not just a risk department, FTX didn’t have a:

• Chief Financial Officer

• Chief Internal Auditor

• Chief Risk Officer

• Dedicated department for – financial risk, audit, and treasury management

Everything from tech, legal, to delivering coffee (with DOODH!) was done by – Nishad Singh and Gary Wang.

Lol, the first time an Indian and a Chinese guy cooperate and it’s for the biggest crypto scam ever. 😭 😭 😭

Doodhwala’s take:

Our #TuesdayMotivation is:

SBF didn’t let accounting and risk management stop him from establishing a $40 billion company (and soon blowing it all away).

So what’s stopping you from launching your own company? 👀

📉 E-T-H Staking Feels the Burn

Yet another week, and we've got regulators + upgrades to blame. 😒

What's happening?

Ethereum staking deposits are on the decline. 😱

Why?

Well, we've got two reasons:

• Increased regulatory pressure 🚨

• The Shapella upgrade 🆕

Let's break it down 👇

1️⃣ Regulatory Pressure

Looks like Uncle Sam's still not BFFs with crypto, and it's starting to show.

The Securities and Exchange Commission (SEC) is adamant that Ether (ETH) is a security and ain't holding back on staking crackdowns.

And the worst part?

The US Congress is still keeping mum on ETH's classification. 🙄

2️⃣ Shapella Upgrade

Mark those calendars, my doodhs! 🗓️

Ethereum's long-awaited upgrade is set to happen on → April 12.

But, wtf is this Shapella upgrade?

Shapella is a mix of = Shanghai + Capella 🤣

Kinda like Messi a mix of = Greatest Of + All Time 😯

The upgrade is gonna let the ETH staked on the Beacon Chain be released in phases. 😮

And it’s causing some serious trouble among stakers as there are concerns about large validators exiting shortly after the upgrade.

That's not all, though. 😯

Bye, Big Exchanges?

As Ethereum staking deposits slump, staking provider trends are shifting.

Centralized exchanges like:

• Coinbase

• Binance

• Kraken

….are losing ground in liquid staking.

And who's coming out on top?

Lido! 🏆

Since October 2022, Lido's ETH staking deposits have gone 🚀

Lido's now got around 1/3 of the total ETH staked, raking in roughly $11 billion from the 5.9 million ETH on the platform. 😲

Why the switch-up? 💰

Well, Coinbase snatches a jaw-dropping 25% commission from staking rewards.

Compare that to Lido's 10% commission, and it's a no-brainer. 🤷‍♂️

Plus, Lido Staked ETH (stETH) offers extra yields on DeFi platforms, making it even more tempting. 💰

🔜 Shanghai Upgrade to Boost Liquid Staking 🔜

Once the upgrade goes live, liquid staking platforms like Lido are expected to soar.

18.1 million. 💰

That’s the amount of ETH currently staked in total (valued at around $33.7 billion), which is 15% of the whole supply. 📈

With the phased withdrawal of ETH from the Beacon Chain post-upgrade, stakers will have more withdrawal options in the weeks and months ahead. 🎉

So even with the dip in Ethereum staking deposits, the future's looking bright for liquid staking platforms. 🤞

📈 Chaach and Charts: Smartest Contract of ‘em ALL

Game-changing moments are what we doodhwala bois live for!

• Alan Turing cracking the Enigma during World War II 🔓

• The infamous Steven Gerrard slip against Chelsea ⚽️

• The launch of the greatest crypto newsletter ever— Doodhwala 🥛

All these were PIVOTAL moments in the history of their respective fields.

When it comes to crypto, that pivotal moment was...the creation of SMART CONTRACTS. 🛠

Ethereum was the first-ever smart contract chain. ⛓

But which chain has the most number of smart contracts?

🥇 BNB → 205 million

🥈 Polygon → 190 million

🥉 Ethereum → 56 million

Crazy how Ethereum is in third despite starting first! 😳

What was the most surprising one to you?

(REPLY and let us know 👇)

🛠 Resourcewala: Handle EVM Calldata Like a Pro

Ever wondered how your smart contracts magically interact with the Ethereum network? 🤔

It's all about that EVM calldata, baby! 🎉

Whether you're just starting or already a smart contract whiz, understanding calldata and ABI encoding is essential for seamless EVM interaction. 💡

So, get ready to explore:

• What is EVM calldata, and why it matters? 🤔

• Tips and tricks to master calldata manipulation 💪

• Role of calldata in smart contract execution 🚀

Unlock the power of smart contract interactions and become an EVM calldata wizard! 🧙

🍼 Doodhshots: Kwon Can't Cash Out

• 🇰🇷 Hacked in Korea: South Korean crypto exchange GDAC suffers a massive $13M heist. Secure your coins, folks!

• 🤖 GPT Gains: CryptoGPT, an AI-focused blockchain project, bags a cool $10M in funding, reaching a whopping $250M valuation. AI-yeah!

• 💰 Bitget's Big Bet: Crypto exchange Bitget launches a $100M Asia-focused Web3 fund, fueling innovation in the East.

• 🛑 Hold Up, Kwon: Prosecutors order Do Kwon to cease liquidating millions in crypto. Freeze, Kwon, freeze!

• 🍣 Sushi's Sweet Recovery: Sushi DEX manages to reclaim 100 Ether after losing millions during a weekend exploit. Phew, sushi never tasted this good!

🤣 Milky Meme Of The Day

If you want more doodh then, be sure to follow our Twitter, our LinkedIn, and our Instagram.

That’s all for today folks! See ya tomorrow!

Yo! Our legal and financial advisors (aka our good ol’ conscience) have asked us to add this boring disclaimer.None of what you read here is financial advice. We aren’t here to get you to buy or sell a crypto. We’re only here to tell you what’s up in crypto today and make you laugh. So, if you screwed up on a trade, that’s on you G. Stay safe in the markets.