Biggest crypto exchange buys rival in crisis, the team of transition in the economy and what matters in the market

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Crypto giant buys rival

Cryptocurrency exchange giant Binance announced on Tuesday an agreement to buy rival FTX, which had been valued at $32 billion (R$ 165 billion) in January, but today it is going through a serious liquidity crisis.

• It is a trade involving the largest and the third largest cryptocurrency exchange by traded volume in the world, according to website CoinMarketCap.

• The numbers involving the agreement were not disclosed and the operations of the two in the US are not part of the deal.

The announcement was made at the same time by Chinese Changpen Zhao, owner of Binance, and American Sam Bankman-Fried, owner of FTX, who have been living a public fight for a few years and which has escalated in recent days.

In numbers: the FTX crisis brought down the quotes of several cryptos. Bitcoin plummeted 11% late Tuesday night to US$ 18.3 thousand🇧🇷 Ether, from the ethereum blockchain, tumbled 15%, for US$ 1.32 thousand🇧🇷

Understand the dispute and liquidity crisis: on Sunday, Binance’s Changpen Zhao said on Twitter that the exchange would sell sell its FTT (FTX crypto) worth $529 million (R$ 2.7 billion), citing “recent revelations”.

• He did not provide further details, but a report by the CoinDesk website pointed out that one of the companies owned by the FTX owner had a large part of its reserves in the FTT token, considered to be of low liquidity (difficult to sell or buy without affecting the price).

• Following the report and Zhao’s tweet, many investors began to withdraw their funds from the FTX brokerage, which generated a liquidity crisis and made it difficult for customers to withdraw their funds. According to the Wall Street Journal, bailouts outnumbered $1 billion in 24 hours.

The problems eventually led Bankman-Fried to sell his exchange to Binance to solve the liquidity crisis.

Lula’s economic team in the transition

President-elect Luiz Inácio Lula da Silva (PT) defined that the command of his transition team in the economic area should be with Persio Arida, André Lara Resende, Nelson Barbosa and Guilherme Mello.

Who is who:

• Persio Arida: is one of the fathers of the Real Plan and was president of the BNDES and the Central Bank during the Fernando Henrique Cardoso administration (1995-2002).

• André Lara Resende: like Arida, he was part of the Plano Real team and has a liberal background, although he has changed his economic thinking in recent years.

• Guilherme Mello: like Barbosa, he is a representative of the party and defends the flexibilization of the ceiling, mainly to meet social demands. He is the only one with no previous government experience.

In the interview in which he announced the names, vice president-elect Geraldo Alckmin (PSB) confirmed that former finance minister Guido Mantega (2006 to 2014) should also be part of the transition, but he did not specify in which area.

Yes but… The fact that these economists are in transition does not mean that any of them will be ministers. Lula has told allies that joining the team does not automatically mean participating in the government.

Impact on the Stock Market: after Sheet having anticipated that Arida and Lara Resende would be part of the transition, around 12:30 pm, the Ibovespa reached the maximum of the day, above 117 thousand points.

• The index returned part of the gains at the end of the day and closed up 0.71%, at 116,160 points. The dollar retreated 0.44% to R$5.15.

• Market analysts told Sheet that the indications were well received, but the movement is still insufficient to clarify the direction of economic policy in the next four years.

Opinion | Vinicius Torres Freire: The transitional government is high-level, but Lula needs a finance minister now.

Bradesco’s profit drop surprises

Impacted by the deterioration in its loan portfolio, Bradesco recorded net income of BRL 5.22 billion in the third quarter, a drop of 22.8% compared to the same period of 2021 and 25% compared to the previous three months.

The result, announced after the trading session, surprised the market. The median estimate of analysts consulted by Refinitiv was a profit of BRL 6.76 billion🇧🇷

What explains: the sharp drop in the profit of the second largest private bank in the country is justified by the increase in expenses with provisions (money set aside to cover defaults).

• they added BRL 7.267 billion in the third quarter, an increase of 36.8% compared to the previous three months.

• The delinquency ratio above 90 days ended September in 3.9%compared to 2.6% in the same month last year and 3.5% in June this year.

More about companies and balance sheets

CADE’s General Superintendence recommended the approval, without restrictions, of the purchase of the insurance company SulAmérica by Rede D’Or. Announced in February, the operation involved the third largest health plan in the country with the largest private network of hospitals in Brazil.

• The business still depends on the approval of the ANS (National Agency for Supplementary Health).

Disney posted a profit of US$ 162 million, below market expectations, largely because of the loss on its streaming platforms.

• Disney’s streaming channels (Disney+, Hulu and ESPN+) added 12.1 million new users, but the industry’s loss for the quarter was $1.47 billion.

• Shares are down nearly 7% in the aftermarket.

Victim of Pix scam must be reimbursed by bank, understands TJ-SP

The TJ-SP oriented judges to hold the banks responsible, and not the victims, in financial fraud cases involving scams such as the motoboy and the Pix, in which criminals clean the victims’ accounts.

Understand: to the court, banks are responsible for detecting and preventing atypical financial transactions on victims’ accounts. A transfer of BRL 10,000 from an account holder who only handles amounts below BRL 1,000 can be considered atypical, for example.

• According to lawyer Leo Rosenbaum, from Rosenbaum Advogados, this understanding paves the way for jurisprudence and also serves as a reference for TJs from other states.

• In the event that the amounts subtracted by the scammers are compatible with the victim’s financial transactions, the Court understands that the responsibility for reimbursement would not lie with the financial institutions.

What explains the decision: previous cases followed a 2011 STJ guideline, which provided that the consumer was a vulnerable part of the relationship, but was not specific about crimes involving cyber scams – which have recently exploded.