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Crypto Goes Briefly Haywire. That’s No Joke.

Illustration by Elias Stein

Bitcoin hit $850 billion this past Tuesday while Ether popped to $179 billion per token. The prices weren’t real, of course. But they highlight how vulnerable crypto data providers and exchanges are to glitches and hacks.

The haywire prices came from crypto site CoinMarketCap. “A drastic volume of users…caused huge pressure in our servers and impacted our price calculation engine,” CoinMarketCap said in an email to Barron’s, adding that the issue was quickly fixed. Still, some faulty data made its way to Coinbase , which tweeted that “some customers are seeing inflated values for non-tradable crypto assets on Coinbase.com and Coinbase Wallet.” Trading wasn’t affected, Coinbase said, and the issues were resolved by early Wednesday.

Binance-owned CoinMarketCap initially made light of the situation, telling Barron’s, “When Bitcoin’s price suddenly makes half the world a trillionaire, it’s almost impossible to keep a straight face.” CoinMarketCap also posted tweets referencing Squid Game, a sad McDonald’s frog, and a Shiba Inu dog trying to bite a hot dog.

Yet crypto isn’t a joke for investors. CoinMarketCap calls itself “the world’s most trusted cryptocurrency data authority.” Coinbase has repeatedly had problems. On Nov, 23, its support site said connectivity issues may “cause failed trades, delayed transactions, and unexpected behavior on the webpage and mobile apps.” Days earlier, it reported issues with GYEN and Powerledger tokens. Trading was delayed on Oct. 27; the site had login issues on Oct. 6. As with all things crypto, caveat emptor remains key.

Last Week
Fear Factors

Stocks slid before the Federal Reserve met, rose after it laid out a hawkish plan on inflation, then fell some more as tech tanked on inflation fears. Omicron didn’t help. On the week, the Dow Jones Industrial Average lost 1.7%, to 35,365.44; the S&P 500 fell 1.9%, to 4620.64; and the Nasdaq Composite slumped 2.9%, to 15,169.68.

Decisions, Decisions

Some 20 central banks met this past week, most fixated on what to do about rising prices. The Fed opted to begin accelerating a reduction in bond purchases in January, ending the stimulus by the end of March. That sets the stage for as many as three rate increases in 2022. The next day, the Bank of England raised rates 0.25%, the European Central Bank pared stimulus, and the Bank of Japan stayed loose. Turkey’s central bank cut rates even as the inflation-wracked lira plummeted.

Omicron on the March

The Omicron variant appeared in more than 30 states, as Princeton and Cornell sent students home for exams and Goldman Sachs canceled holiday parties. South Africa reported the Pfizer vaccine was 70% effective against Omicron, and health officials urged boosters. The U.S. hit 800,000 Covid deaths. Tornadoes, meanwhile, hammered six states, killing nearly 90.

Oil Prices: a Wash

OPEC+ left its supply and demand estimates intact, arguing that the effect of Omicron would not be as serious as feared. And the International Energy Agency reduced its daily forecast of supply, but cut demand, as well. Germany refused to start the Nord Stream 2 gas pipeline from Russia.

China Blacklists

The U.S. plans to put eight more Chinese companies on its investment blacklist, including DJI Technology, the world’s largest commercial drone maker. The eight are accused of involvement in China’s oppression of Uighur Muslims. Also on the list was Megvii, an artificial-intelligence company and rival to SenseTime, which put off its Hong Kong IPO after it hit a U.S. blacklist. Domestic creditors, meanwhile, sued China Evergrande , seeking $13 billon.

Annals of Deal Making

Parthenon Capital Partners said it was buying Kroll Bond Rating for $900 million…Motorcycle maker Harley-Davidson is spinning off its electric-cycle business, LiveWire, to a SPAC in a deal with an enterprise value of $1.8 billion. Harley will retain a 74% stake…The United Kingdom’s Rentokil Initial said it was buying U.S.-based Terminix Global for $6.7 billion…The Wall Street Journal reported that Oracle was in talks to buy medical software company Cerner for $30 billion…Wall Street’s two biggest deal banks, JPMorgan Chase and Goldman Sachs, each said that bonuses for bankers could rise as much as 40%. Global deal volume is at $2.3 trillion year to date…Bruce Springsteen sold his music rights to Sony Music for $500 million.

Write to Daren Fonda at [email protected] and Joe Woelfel at [email protected]

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