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(Bloomberg) — The cryptocurrency market has been nothing short of a financial soap opera in 2022, and the drama continued this week when the lender Celsius Network filed for bankruptcy protection. Yet there is one important place where the drama has cooled off noticeably: the actual prices of the largest digital tokens themselves. 

Bitcoin climbed almost 8% in the final three days of the work week, while Ether surged 20%. Neither of the two dominant tokens has set a new low point in this bear market for almost a month. Bitcoin has been hugging the closely watched $20,000 round number, while Ether is hovering near $1,000.    

The relative stabilization in the charts is fueling hopes that contagion may have run its course following the spectacular collapse of tokens on the Terra blockchain, a wipeout that also sent hedge fund Three Arrows Capital and brokerage Voyager Digital into bankruptcy court. While much of the crypto world’s leverage is not recorded on blockchains, and therefore hidden from scrutiny, what is visible is encouraging, according to James Check, lead analyst at Glassnode.

“I do think that the vast majority of the forced selling has already happened,” Check said in an interview. “Essentially, the market seems relatively stable.” 

There are two important sources of potential sellers that are left, Check caveats. One is Bitcoin miners, who have seen the value of their hardware plunge along with the price of the token — stress that could worsen if Celsius’s mining subsidiary starts unloading some of its 80,850 rigs to raise capital. The other is traders who will indiscriminately sell risk assets of all kinds if the stock market starts to collapse again. 

On that front, this week did bring some potential good news for the laser-eye set. For one thing, the S&P 500 remains about 5% above its bear-market low from last month. And the 40-day correlation between Bitcoin and the Nasdaq 100 Index has receded to the weakest level since January, suggesting that the two are less vulnerable to lockstep moves in either direction.

Read More: Bitcoin Hints at a Bottom, But It May Be Different This Time 

Fresh catalysts are needed to push prices decisively one way or another, according to James Malcolm, head of foreign exchange and crypto research at UBS. One good sign that the market could be normalizing, though, is the strong performance of second-tier tokens such as of Matic and Aave. 

“What we’re seeing in crypto at the moment is a situation where individual stories matter a little bit more,” he said. “Some of that’s related to new products, some of it is related to tech upgrades and some to business tie-ups. So we seem to be slipping into a more-conventional market.”

All that said, this famously mercurial asset class has proven time and again that picking a bottom — or a top — is a perilous endeavor. And any green shoots that appear to be emerging in this crypto winter will likely need nourishing from macroeconomic factors, which are currently being driven by sky-high inflation and the Federal Reserve’s determination to snuff it out with higher interest rates.    

“I wouldn’t want to extrapolate too much on it,” Marc Chandler, chief market strategist at Bannockburn Global Forex, said of the recent stabilization in crypto prices. “To me, the quieter tone you’ve seen in crypto this week may be a reflection of a lack of participation as people try to figure out what to do in this environment, in which the Fed is clearly tightening.”

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(Bloomberg) — What’s buzzing on social media this morning:

BUZZING COMPANIES

The Toyota Crown, a car known for ferrying around Japan’s corporate and political elite, is set for the global stage starting next year with Toyota planning to release versions in 40 countries and regions. The Crown was the first Toyota passenger car designed and manufactured entirely in Japan, making it a symbol of the automaker’s postwar rise.

BUZZING TWEETS

Joe Manchin, the conservative-leaving senator from West Virginia, is attracting howls from fellow Democrats for again derailing President Joe Biden’s domestic agenda. He rejected several tax and climate provisions that Biden and his party’s leadership have been pitching to him, though the holdout lawmaker has said he would back a prescription drug pricing package tied to a two-year extension of Affordable Care Act subsidies.

The House committee investigating the assault on the US Capitol has subpoenaed records from the Secret Service after being told by a government inspector general that the agency wasn’t cooperating with the inquiry. Texts from Secret Service agents on Jan. 5 and Jan. 6, 2021 were reported lost during an equipment replacement after the inspector general’s office asked for them as part of its investigation of the Capitol assault.

Ivana Trump, divorced from the former president, died from “an accident caused by blunt impact injuries to her torso,” New York City’s chief medical examiner said in a statement. The police were investigating whether Trump, who was 73, had fallen down a staircase, the New York Times reported, though this being the internet, conspiracy theories abounded.

President Joe Biden’s trip to Saudi Arabia included a fist bump, discussions about Riyadh leading OPEC+ to gradually boost oil supply, and murdered Saudi journalist Jamal Khashoggi.

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(Bloomberg) —

Satellite images show a Russian delegation visiting Iran to view unmanned weapons-capable drones that could be purchased for use in the war in Ukraine, a senior US official said Saturday.

The disclosure by the US is intended to bolster the assertion by US National Security Advisor Jake Sullivan — made without details of the underlying intelligence — that Russia was seeking to purchase hundreds of unmanned aerial vehicles to help its campaign in Ukraine. 

The US disclosure comes as President Joe Biden is meeting Saturday with Gulf leaders in Saudi Arabia, asking them to both strengthen regional cooperation to counter Iran and increase support for Ukraine.

The US said earlier in the week that the potential purchase was a sign of the toll Ukrainian fighters had taken defending their country from Russia’s invasion.  

The June visit to see the drone showcase is, to the knowledge of US intelligence, the first time a Russian delegation had visited Kashan Airfield south of Tehran for such a showcase, the official said.

The satellite imagery was first reported by CNN.

Iranians demonstrated to the Russians the capabilities of their Shahed-191 and Shahed-129 drones, capable of  carrying precision-guided missiles, officials told the network.

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(Bloomberg) — Porsche is pitching its initial public offering as a chance to invest in a company that combines the best of carmaking rivals like Ferrari NV and luxury brands such as Louis Vuitton. The problem is, not all investors are buying it.

In early meetings with portfolio managers, the Volkswagen AG unit compared itself to the French handbag maker and Cartier owner Richemont as businesses that generate healthy profits and significant sales volumes, according to people familiar with the matter. It also cited Ferrari, which boasts industry-leading margins but ships only a fraction of the more than 300,000 cars Porsche makes every year.

Among concerns flagged by investors is a listing structure that fails to make Porsche more independent from its parent, said the people, who asked not to be identified discussing confidential information. They’re also citing headwinds in the IPO market, which has slowed dramatically due to jitters over runaway inflation, rising interest rates and the war in Ukraine that’s sparked Europe’s worst energy crunch in decades.

“Porsche isn’t a safe bet in a recession because it’s not as exclusive as Ferrari,” said Daniel Roeska, an auto analyst at Bernstein. “And if you don’t change the governance and allow Porsche to decide what’s best for itself rather than making decisions at the group level, then you’re not maximizing shareholder value.”

The offering, which may launch as soon as September, is poised to be one of Europe’s biggest ever. VW has hired more than a dozen banks to push the IPO, which could value Porsche at as much as 80 billion euros ($80.5 billion) to 90 billion euros, according to people familiar with the matter. If achieved, that could even exceed the parent company’s current market value. It comes at a time when automakers are battling supply-chain snarls and have embarked on a costly transition to electric vehicles.

Still, an IPO of that size is so rare in Europe that it can defy the broader market slump, with portfolio managers forced to take a hard look at the candidate because it will automatically enter the region’s main equity benchmarks, the people said. 

READ: Volkswagen Is Said to Add More Banks to Porsche Sports Car IPO

While VW didn’t provide specific numbers or a valuation target in the meetings in Europe and the US, fund managers who attended were left with a positive impression about the brand’s potential to lift margins in the medium term, the people said. Porsche is holding a capital markets day Monday where it could map out a renewed profit push.

But several fund managers remain concerned about Porsche’s small free float of 12.5%, and a dual-class share structure that leaves little room for greater managerial independence.

VW plans to sell a stake of as much as 25% of preferred shares that don’t carry voting rights. The powerful billionaire Porsche and Piech clan, which controls VW through voting stock, would receive a special dividend to fund buying a blocking minority stake in Porsche.

A spokesperson for Porsche declined to comment when contacted by Bloomberg News.

Porsche’s managers “presented their strategy to taking the company forward very well,” said Simon Jaeger, a portfolio manager at Flossbach von Storch AG. Still, he cautioned that the planned ownership structure is poised to weigh on the company’s valuation.

Investors have in the past blamed VW’s convoluted governance structure for its sub-par stock-market performance. VW’s preferred shares have dropped around a quarter this year, valuing the entire company — which also includes Audi, Lamborghini and Bentley — at roughly 80 billion euros. 

VW has been pushing for years to become more nimble but success has been limited. A listing of Traton SE, VW’s truckmaking unit, fizzled amid internal ructions and a small free float. The firm’s shares have almost halved since the 2019 IPO.

Porsche argues it stands out among luxury-car makers because of its high volumes. The brand sold 301,915 vehicles last year, compared with Ferrari’s 11,155 and the 6,178 autos shipped by Aston Martin Lagonda Global Holdings Plc. It’s also touting Porsche’s resilience when it comes to profitability, with the unit’s operating margins coming in at an average of 16.1% in the five years through 2021, according to a presentation seen by Bloomberg.

Macro Concerns

But there’s concern about the macro environment. The auto industry has had trouble ramping up production after the pandemic rattled global supply chains and sparked a shortage of semiconductors. Tesla Inc., the world’s best-selling EV maker, has lost around a third of its value this year. Even Ferrari, which targets an operating margin of as much as 30% by 2026 and is seen as the gold standard of successful luxury-car IPOs, is down about 16%.

“Porsche’s margin profile puts it at a discount to Ferrari,” said Dev Chakrabarti, a portfolio manager at AllianceBernstein. “I would see the company’s valuation getting closer to $75 billion in an IPO rather than $100 billion as has been touted.”

There’s one key aspect Porsche has going for it: It’s far ahead of peers including Ferrari and Aston Martin when it comes to electrifying its lineup.

The early IPO meetings were held in Frankfurt, London, New York and Boston, one of the people said, adding that some investors were given a tour of a plant where Porsche assembles the Taycan — an EV that outsold the iconic 911 last year. The manufacturer is also preparing to launch a battery-powered version of its popular Macan SUV to take on Tesla’s Model Y.

Porsche “is the closest legacy brand to Tesla in terms of electrification,” Bloomberg Intelligence analyst Michael Dean said in a note this week. “It will be a key competitor to Tesla in 2023.”

(Updates with details on Traton’s listing in 13th paragraph.)

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(Bloomberg) — California’s historic drought may leave the state with the largest amount of empty farmland in recent memory as farmers face unprecedented cuts to crucial water supplies.

The size of fields intended for almonds, rice, wine grapes and other crops left unworked could be around 800,000 acres, double the size of last year and the most in at least several decades, said Josue Medellin-Azuara, an associate professor at University of California Merced.

The figure is preliminary as researchers continue to look at satellite imaging and other data. An official estimate remains a few weeks away, said Medellin-Azuara, who is leading an economic study on farm production and droughts with funding from the California Department of Food and Agriculture. 

Much of the idle land is in California’s Central Valley, which accounts for about a quarter of US food production. Mile after mile of farmland reveals whithered crops next to fields of lush green plants, a testament to the tough decisions growers are forced to make on how much and what to produce, and whether to keep farming at all. 

Surface water rights are seeing sharp cuts amid the drought and reserves are declining because of critically low snowmelt and depleted storage from last year.

“What’s really concerning is for the first time we are fallowing at least 250,000 acres in the Sacramento Valley,” Karen Ross, secretary of the California Department of Food and Agriculture, said in an interview. “Those are the most senior water rights holders.”

Last year, some California farmers were stunned to find their so-called senior water rights restricted. Water laws in the state are governed by a complex system that dates back to the Gold Rush era. Senior rights holders — which include companies, growers and cities with claims that were acquired before 1914, and landowners whose property borders a river — are the last to see their supplies curtailed.

Sacramento Valley typically “acts a funnel” that provides key water supplies to the broader region, according to the Northern California Water Association.

New regulation of the use of groundwater is also complicating the supply picture in the state, Medellin-Azuara said.

California has roughly 9 million acres of irrigated land. Drought last year directly cost the local agriculture industry and state about $1.7 billion, according to UC Merced researchers.

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(Bloomberg) — Greg Fleming, head of wealth adviser Rockefeller Capital Management, said he sees financial institutions becoming increasingly wary of expanding in China due to mounting geopolitical tensions and pandemic restrictions.

“There will be much more caution in terms of the level of capital investment and aggressiveness of the growth strategy,” Fleming said Friday in an interview with Bloomberg Television.

He said he anticipates the pullback will boost US manufacturing of precision products like semiconductors, a move that will strengthen the American economy while also stoking an already scorching rate of inflation. 

Fleming, a former president of Morgan Stanley Wealth Management, said the retreat from Asia is an abrupt departure from the trend he’s witnessed for much of his career.

“All the major financial firms in the US were trying to build a presence in those markets and now you have a retrenchment back to home markets, on both a financial basis as well as on trade,” he said.

Fleming, 59, helped create Rockefeller in 2018 as an outgrowth of the family office of oil tycoon John D. Rockefeller. The New York-based company oversaw $95 billion of client assets as of March 31 across its three business segments.

Rockefeller has continued an aggressive acquisition strategy even with the recent downturn in equity markets, adding at least a dozen teams this year in cities including Atlanta, Denver, West Palm Beach and San Jose, California. The firm has offices in 38 locations across the US and opened a London office in early 2022. 

Read more: Rockefeller Caps Whirlwind Month of Hiring With Merrill Team

Rockefeller’s push to bulk up on wealth advice comes as the ranks of high-net-worth individuals swelled following a decade-long bull market, capped by a surge in asset values in the wake of the Covid-19 pandemic. While that run-up has reversed recently as stocks turned volatile, some firms are taking advantage of the lull to expand their offerings.

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(Bloomberg) — Elon Musk’s lawyers say Twitter Inc. officials are unfairly pushing for a “warp speed” trial over claims the billionaire improperly canceled his proposed $44 billion buyout of the social media company, and asked that the case be heard next year instead.

Musk’s legal team on Friday rebuffed Twitter’s argument that the case over the teetering transaction can be wrapped up in a four-day trial starting in September in Delaware Chancery Court, saying it will require “forensic review and analysis of large swaths of data” about Musk’s claims that Twitter’s customer base is riddled with spam and robot accounts. 

Musk is requesting a Feb. 13, 2023, trial at the earliest, “an extremely rapid schedule for a case of this enormous magnitude,” he said in a 14-page filing, according to a representative for Musk. The judge will hold a hearing July 19 on whether to put the case on a fast track.

Twitter declined to comment on Musk’s filing.

The Twitter buyout agreement specifies that all legal disputes over the deal must be heard in Delaware, corporate home to more than half of US public companies, including Twitter and Musk’s Tesla Inc., and more than 60% of Fortune 500 companies. 

Unlike some states, where it can take several years to get a case to trial, Delaware Chancery Court moves quicker. The judges, business law experts, are known for parsing legal thickets of complex merger-and-acquisition disputes fast and thorough. Complex business cases are often argued before a judge within six or seven months of being filed.

Until now, Musk hadn’t responded in court to Twitter’s allegations that he’s using the bots issue as a pretext to walk away from the $54.20-per-share bid he made for the company in April. The Tesla chief executive backed out of the deal July 8, saying in a regulatory filing that Twitter had made “misleading representations” over the number of spam bots on the service. 

In his response to Twitter’s fast-track request, Musk said the platform’s officials stalled providing information about the spam and robot accounts to gain a “tactical delay” that would buttress their demand for an expedited trial.

“Twitter’s sudden request for warp speed after two months of foot-dragging and obfuscation is its latest tactic to shroud the truth about spam accounts long enough to railroad defendants into closing,” his lawyers said in the filing.

“The core dispute over false and spam accounts is fundamental to Twitter’s value,” Musk’s lawyers wrote. “It is also extremely fact and expert intensive, requiring substantial time” for pretrial exchanges of information.

Musk even chided Twitter officials for being no fun.

“With the sense of humor of a bot, Twitter claims Musk is damaging the company with tweets like a Chuck Norris theme and a poop emoji,” the lawyers wrote. “Twitter ignores that Musk is its second largest shareholder with a far greater economic stake than the entire Twitter board.”

Musk’s response includes a claim that Twitter checks only 100 accounts a day when trying to calculate the number of spam bots on the service, something Musk has referred to in prior Tweets. In those tweets, though, he suggested that Twitter checks 100 accounts in total, not daily. The company says it checks roughly 9,000 accounts a quarter, which would average out to about 100 a day.

In response to Musk’s requests for specifics on spam and robot accounts, Twitter officials said they made available all the information they had by providing their whole “firehose” of data.

Musk counters that the firehose didn’t provide a wealth of bots data, but instead offered “a bespoke partial data set structured to make the necessary machine analysis impossible.”

Musk accused Twitter of violating the deal’s “ordinary course” provisions by firing some executives and setting up a hiring freeze. Such obligations require the target of a buyout to operate in the ordinary course of business while waiting for the deal to close.

A Chancery judge recently concluded that violations of this obligation by the owner of a string of luxury hotels allowed a would-be buyer to walk away from the more than $5 billion purchase.

The case is Twitter v. Musk, 22-0613, Delaware Chancery Court (Wilmington). 

(Updates with Twitter response in fourth paragraph)

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(Bloomberg) — Elon Musk’s lawyers say Twitter Inc. officials are unfairly pushing for a “warp speed” trial over claims the billionaire improperly canceled his proposed $44 billion buyout of the social media company, and asked that the case be heard next year instead.

Musk’s legal team on Friday rebuffed Twitter’s argument that the case over the teetering transaction can be wrapped up in a four-day trial starting in September in Delaware Chancery Court, saying it will require “forensic review and analysis of large swaths of data” about Musk’s claims that Twitter’s customer base is riddled with spam and robot accounts. 

Musk is requesting a Feb. 13, 2023, trial at the earliest, “an extremely rapid schedule for a case of this enormous magnitude,” he said in a 14-page filing, according to a representative for Musk. The judge will hold a hearing July 19 on whether to put the case on a fast track.

Twitter declined to comment on Musk’s filing.

The Twitter buyout agreement specifies that all legal disputes over the deal must be heard in Delaware, corporate home to more than half of US public companies, including Twitter and Musk’s Tesla Inc., and more than 60% of Fortune 500 companies. 

Unlike some states, where it can take several years to get a case to trial, Delaware Chancery Court moves quicker. The judges, business law experts, are known for parsing legal thickets of complex merger-and-acquisition disputes fast and thorough. Complex business cases are often argued before a judge within six or seven months of being filed.

Until now, Musk hadn’t responded in court to Twitter’s allegations that he’s using the bots issue as a pretext to walk away from the $54.20-per-share bid he made for the company in April. The Tesla chief executive backed out of the deal July 8, saying in a regulatory filing that Twitter had made “misleading representations” over the number of spam bots on the service. 

In his response to Twitter’s fast-track request, Musk said the platform’s officials stalled providing information about the spam and robot accounts to gain a “tactical delay” that would buttress their demand for an expedited trial.

“Twitter’s sudden request for warp speed after two months of foot-dragging and obfuscation is its latest tactic to shroud the truth about spam accounts long enough to railroad defendants into closing,” his lawyers said in the filing.

“The core dispute over false and spam accounts is fundamental to Twitter’s value,” Musk’s lawyers wrote. “It is also extremely fact and expert intensive, requiring substantial time” for pretrial exchanges of information.

Musk even chided Twitter officials for being no fun.

“With the sense of humor of a bot, Twitter claims Musk is damaging the company with tweets like a Chuck Norris theme and a poop emoji,” the lawyers wrote. “Twitter ignores that Musk is its second largest shareholder with a far greater economic stake than the entire Twitter board.”

Musk’s response includes a claim that Twitter checks only 100 accounts a day when trying to calculate the number of spam bots on the service, something Musk has referred to in prior Tweets. In those tweets, though, he suggested that Twitter checks 100 accounts in total, not daily. The company says it checks roughly 9,000 accounts a quarter, which would average out to about 100 a day.

In response to Musk’s requests for specifics on spam and robot accounts, Twitter officials said they made available all the information they had by providing their whole “firehose” of data.

Musk counters that the firehose didn’t provide a wealth of bots data, but instead offered “a bespoke partial data set structured to make the necessary machine analysis impossible.”

Musk accused Twitter of violating the deal’s “ordinary course” provisions by firing some executives and setting up a hiring freeze. Such obligations require the target of a buyout to operate in the ordinary course of business while waiting for the deal to close.

A Chancery judge recently concluded that violations of this obligation by the owner of a string of luxury hotels allowed a would-be buyer to walk away from the more than $5 billion purchase.

The case is Twitter v. Musk, 22-0613, Delaware Chancery Court (Wilmington). 

(Updates with Twitter response in fourth paragraph)

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(Bloomberg) — The aspiring Wall Street rapper accused of conspiring with her husband to launder $4.5 billion worth of Bitcoin stolen from the Bitfinex currency exchange won court approval to seek a new job while her case proceeds.

A judge on Friday granted Heather Morgan’s request to modify the conditions of her pre-trial release so that she “may engage in legitimate employment and receive income of greater than $10,000 per month.” Prosecutors didn’t object to the request in federal court in Washington.

Morgan and her husband Ilya Lichtenstein were charged in February following the government’s largest financial seizure ever. The next month, the pair asked for a delay to the case to facilitate plea discussions.

The US previously said the couple had “highly troubling” overseas ties and fraudulent identities as well as access to hundreds of millions of dollars in cryptocurrency. The value of Bitcoin has fallen more than 50% since the two were arrested at their apartment in Manhattan.

Read more: ‘Crocodile of Wall Street’ Arrested in $4.5 Billion Crypto Crime

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(Bloomberg) — Amtd Digital Inc. rose 108% after its US initial public offering, the biggest first-day jump for a listing of its size.

American depositary shares of Amtd Digital closed Friday at $16.21 after selling for $7.80 in the IPO. The company, which had marketed the shares for $6.80 to $8.20, sold 16 million shares to raise almost $125 million.

The debut showing was the best for a listing of more than $25 million on a US exchange this year, according to data compiled by Bloomberg. That compares with 11 listings of that size at this time last year that doubled or more on their first day of trading.

Amtd Digital is also the biggest IPO in the US this month, with a listings drought dragging on. The year’s 145 listings, including blank-check companies, have raised only $18.7 billion, compared with 648 IPOs totaling a record $219 billion at this point in 2021.

The Hong Kong-based financial services platform, with a market value of $3 billion, is trading on the New York Stock Exchange under the symbol HKD.

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