 Celsius Network founder and CEO Alex Mashinsky | Image: Piaras Ó Mídheach/Getty Images Embattled crypto lender Celsius Network revealed it has a $1.2B hole in its balance sheet. The firm filed for Chapter 11 bankruptcy in federal court in New York on Thursday. Celsius has $5.5B in total liabilities, of which $4.7B is owned by Celsius’ users. Last month the company suspended all withdrawals, citing “extreme market conditions.” More: - Celsius’s terms of use agreement has raised questions about whether users would be able to recover their cryptocurrency deposits or collateral.
- According to a court filing, Celsius has $4.31B in total assets as of July 13, down from $25B reported in October.
- Celsius founder and CEO Alex Mashinsky said the company was planning to partly make up the deficit by using newly minted bitcoins from its mining facility.
- Celsius’s mining business generated 3,114 bitcoins last year, about $65M, based on Friday’s Bitcoin price of $20,955.
- Celsius has mined 14.2 bitcoins a day in the last week.
- Mashinsky said the contract between Celsius and its users explicitly stated that Celsius has ownership rights over customer deposits and has the right to lend, sell, transfer or use them for any period of time.
- Conversely, customer deposits in traditional bank accounts are protected by the Federal Deposit Insurance Corp.
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BlackRock released its Q2 earnings on Friday, reporting an 11% drop in the firm’s assets under management. The world’s largest asset manager reported $4.5B in revenue, down 6% YoY. Net income came in at $1.08B, down 22% YoY. Diluted EPS was $7.06, and AUM decreased from $9.6T to $8.5T. More: - BlackRock CEO Larry Fink said this year had the worst start in 50 years for both stocks and bonds, with global equity markets down 20% and the aggregate bond index down 10%.
- The firm brought in about $90B in new investor money in the quarter, up from $81B a year ago.
- BlackRock shares closed at $600.37, up 2% for the day. The firm is down ~34% YTD.
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 Image: Pinterest Activist investor Elliott Management has taken a more than 9% stake in social media platform Pinterest, becoming its largest investor. Pinterest allows users to share and pin images that inspire projects like planning a wedding, trying a new recipe, or doing home renovations. Pinterest has been struggling as COVID-19 restrictions eased and people spent less time online. The platform was also impacted by Apple’s changes to its privacy policy. More: - In recent months, several Pinterest executives have left the company, including its head of global business operations and its investor-relations chief.
- In June, the company named former Google president of commerce Bill Ready as its CEO, and Pinterest co-founder and CEO Ben Silbermann transitioned to executive chairman.
- Silbermann has a ~37% voting stake in the company, which could make it difficult for Elliott to enforce changes.
- Pinterest shares are down about 50% YTD with a market cap of about $12B.
- Following news of Elliott’s stake, the company’s shares surged about 25% in after-market trading on Thursday. Pinterest shares closed at $20.40, up over 16% for the day.
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Wells Fargo released its Q2 earnings on Friday, reporting a 48% decline in profits. The bank generated $17.03B in revenue, down 16% YoY. Net income came in at $3.12B, or 0.74 cents a share, down 48% YoY. The bank reported a $576M Q2 impairment on equity securities tied to its venture capital arm. More: - CFO Mike Santomassimo said the mortgage market would be challenging in the next two quarters, citing the Fed's planned interest rate hikes.
- The bank said it has set aside $235M in new funds to cover potential losses from new loans issued in the quarter.
- Last year, Wells Fargo released $1.64B in funds it had set aside for potential loan losses.
- Wells Fargo's net interest income rose 16% to $10.2B, thanks to higher rates and loan balances.
- Wells Fargo shares closed at $41.13, up over 6%. It is down ~19% YTD.
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Fintech giant Stripe cut its private valuation by 28% to $74B, bringing its internal share price to about $29. Last year Stripe was valued at $95B, with an internal share price of around $40, after raising $600M from a group of investors, including Ireland’s National Treasury Management Agency, Fidelity Investments, and Allianz SE. More: - At one point last year, Stripe was the most valuable startup in the U.S.
- The company processes payments for fellow startups and tech companies, including skincare provider Glossier and ride-hailing service Lyft.
- In an email sent to employees, Stripe said its board approved the lower share price effective June 30 but didn’t provide an explanation for the move.
- Several publicly traded fintech companies have seen their shares fall in the last few months, making Stripe look overvalued.
- PayPal shares are down over 60% YTD.
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Citigroup released its Q2 earnings on Friday beating analysts’ expectations on revenue and profits. The bank generated $19.64B in revenue, up 11% YoY. Among the four major banks that reported earnings this week, Citigroup is the one to top expectations for revenue. Net income came in at $4.5B, or $2.19 a share, down 27% YoY. More: - The bank reported a 14% increase in its net interest income to $11.96B.
- CEO Jane Fraser said the bank was pausing share buybacks and would resume as soon as it is prudent.
- Citigroup’s Institutional Clients arm reported $11.4B in revenue, up 20% YoY.
- Its Treasury and trade solutions arm generated $3B in revenue, up 33% YoY.
- Citigroup shares closed at $49.98, up over 13% for the day. It is down 21% YTD.
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- The House passed two bills on Friday aimed at ensuring abortion access and protecting the ability of women seeking abortions to cross state lines. The bills are not likely to survive a Republican filibuster in the Senate, as Democrats would need at least 10 GOP votes to overcome it.
- NFT marketplace OpenSea plans to lay off about 25% of its employees. The company has about 230 employees, suggesting about 57 people would be laid off. CEO Devin Finzer said the company would provide severance and healthcare coverage into 2023.
- Due to safety concerns, Starbucks is closing 16 U.S. stores by the end of July. Most of the stores are on the West Coast – six in greater Los Angeles; six in Greater Seattle; two in Portland, Oregon; one in Philadelphia, and one in D.C.
- The U.S. has approved Sweden-based telecom-equipment company Ericsson AB’s proposed $6.2B acquisition of Vonage Holdings, clearing the way for the transaction to be completed next week.
- President Biden met with Saudi Crown Prince Mohammed bin Salman on Friday in Saudi Arabia. The Biden administration aims to reset relations with the leader to help reassert U.S. leadership in the Middle East.
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 |  | Vanessa Omeokachie is a Researcher at Inside. Her interests include finance, tech, and startups. In her free time, she enjoys reading, hiking, attending music festivals, and traveling. Connect with her on Twitter @VanessaOmeo or through email at vanessa@inside.com |  | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 Ford. | |
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