Update Regarding The Recent Events

We wanted to share a quick update on the recent events that impacted the digital asset industry. The situation is evolving at a very rapid pace and we will keep monitoring it very closely.

For the avoidance of doubt, Eterna Capital has no direct exposure to FTX, Alameda Research or the FTT token (the FTX exchange token).

Last week, a leaked balance sheet from Alameda Research raised questions and investor concerns about a liquidity crunch for both FTX and Alameda Research. Before the market had a chance to fully digest the information, the industry was hit with a plot twist earlier this week: Binance (the world's largest crypto exchange) struck a non-binding deal to acquire FTX.com (the non-US business of FTX). Prices fluctuated dramatically as the situation developed before falling sharply as the magnitude of the event settled in. The impact amplified as news that Binance was backing out of the deal just 24 hours after the initial acquisition announcement.

While FTX and Alameda Research's insolvencies are undoubtedly a possibility at the moment, it is too early to understand the full scope of the impact and consequences the event will have on the rest of the industry. This event comes in after a series of 'bad news' that shuck up the digital asset industry since the start of the year (i.e. Terra/Luna collapse, BlockFi/Celsius/Voyager insolvencies). While such events will certainly impact the industry's reputation and trust as a whole in the short term, we remain confident that overall this is a painful but healthy process from which a much stronger industry will emerge.

At Eterna Capital, we have always considered regulatory frameworks as a necessity and requirement to help shape thoughtful regulation that fosters both user protection and innovation. We are also very strong advocates for more transparency and better governance - after all that is the ethos of Web3. It is now time for key stakeholders to set clear and appropriate rules to help consumers participate in and founders build what we consider to be the future of the Internet. We look forward to continue supporting disciplined entrepreneurs and founders who are building a healthier and more sustainable industry. For us, Web3 is an undeniable innovation that will prevail in the long run.

Warm Regards,

The Eterna Capital Team