Winnipeg Free Press

Winnipeg Free Press (Newspaper) - January 21, 2025, Winnipeg, Manitoba WINNIPEGFREEPRESS.COM ● B7 BUSINESS TUESDAY, JANUARY 21, 2025 Crypto executives warn Trump’s memecoins harm industry U.S. President Donald Trump and First Lady Melania’s new memecoins have ignited criticism from crypto exec- utives who were expecting the digit- al-asset sector to be treated seriously by the Republicans’ incoming U.S. ad- ministration. The president-elect (sworn-in Mon- day) unveiled the “Trump” token Jan. 17 and his wife launched her “Melania” ef- fort on Sunday. The Trump memecoin’s market value hit US$15 billion at one point but then briefly slid below US$8 billion as Melania’s token took some of the spotlight, figures from aggregator CoinMarketCap show. The memecoin sector, stuffed with joke tokens like Dogecoin offering little intrinsic value and lots of volatility, is divisive as it feeds criticism of the nas- cent industry as too frivolous and risky for mainstream investors. Memecoins rely on social media tailwinds that can disappear as quickly as they arise. While Trump’s latest crypto foray turbocharged speculation — Bitcoin jumped to a fresh record Monday just hours before his inauguration — some executives said it will do more harm than good to an industry trying to re- build its reputation. It quickly added a windfall of billions of dollars, at least on paper, for Trump-linked entities just as the president is said to weigh an executive order designating the asset class a “national priority.” The Trump launches are “now clearly a blight that we will have to work to put behind us as builders,” said Rob Had- ick, general partner at crypto-focused venture-capital company Dragonfly Capital. The Trump token’s market capitaliz- ation stood at just below US$11 billion as of 11 a.m. in London, CoinMarketCap data show. Rather than two new memecoins, the industry was keen to focus on Trump’s expected steps to foster wider indus- try growth following his inauguration. Crypto executives spent the past two years fending off a crackdown by the U.S. Securities and Exchange Commis- sion in the wake of the chaotic implo- sion of Sam Bankman-Fried’s trading platform FTX. In a post on X, Balaji Srinivasan, an angel investor and former chief tech- nology officer at U.S. crypto exchange Coinbase Global Inc., said memecoins are a zero-sum “lottery” where the “price eventually crashes and the last buyers lose everything.” In a separate post, SkyBridge Cap- ital LLC founder Anthony Scaramucci pointed out the launch of Melania coin caused Trump coin to sink. Scaramucci was briefly Trump’s dir- ector of communications in 2017 during the latter’s first presidency before be- ing fired and becoming a vocal critic. Meanwhile, Gabor Gurbacs, director of digital-asset strategy at investment pro- vider VanEck until last year and founder of PointsVille, said the memecoins “cost the U.S., the presidency and his family a lot of credibility.” Gurbacs said in an X post the conse- quences of the launches “haven’t even started” and called on Trump to fire his crypto advisers. Representatives for Trump didn’t re- turn requests for comment about the criticism of the memecoins from some digital-asset executives. Trump used to be a crypto industry skeptic but pivoted as the sector poured huge sums into campaign coffers dur- ing the build-up to the U.S. election. He now plans to turn the U.S. into the linch- pin of the global digital-asset industry and has backed the idea of establishing a national Bitcoin stockpile. The president’s previous forays into crypto include profitable collections of nonfungible tokens, digital collectibles that show him in a variety of poses and costumes. Along with his sons, he’s also endorsed World Liberty Financial, a project that has been much-hyped but for which details remain scarce. The weekend memecoin drama was a “wild” turn of events “even the crypto industry hadn’t quite imagined,” said Caroline Mauron, co-founder of Orbit Markets, a provider of liquidity for crypto derivatives. “I suppose a more conventional policy approach was ex- pected — which may still be coming.” — Bloomberg News RYAN WEEKS Oil tankers backlog grows at vital Russian port after sanctions A BACKLOG of tankers is growing near Russia’s key oil port of Kozmino, the latest sign of disruption being wrought on the nation’s exports by sweeping U.S. sanctions. On Jan. 10, the outgoing Biden ad- ministration designated 161 oil tankers along with vital traders and vessel in- surers involved in the Russian export program. Oil futures surged as the market digested the supply implica- tions of the move. There are now nine oil tankers idling near the Russian Pacific port, the na- tion’s largest individual crude-export facility. While there are normally a few waiting at any one time, the num- ber doing so now is bigger than normal, traders and shippers who monitor the exports said. A further 11 vessels are either approaching or have recently left. History shows U.S. sanctions have bitten the tankers that move Russian oil hard. Traders and shipping officials who monitor exports from the port said if that’s the case at Kozmino, then Mos- cow may struggle to find enough ship- ping capacity. Traders are looking for any signs of disruption to Russia’s crude oil and fuel flows, which on a combined basis were neck-and-neck with those of Saudi Ara- bia as the world’s biggest seaborne ex- port program last year. There are wider signs of disruption — from u-turning vessels to buyers looking elsewhere. Even before the Jan. 10 measures, the Chinese port of Shandong had warned companies there to be cautious in deal- ing with sanctioned barrels. Several Asian oil traders said they believe it’s possible blacklisted vessels may get shunned by buyers at the facility, which is home to millions of barrels a day of oil processing. Likewise, a senior official in India, Russia’s other key buyer, warned al- most as soon as the measures were an- nounced that designated tankers would be barred. The ban excludes cargoes collected before Jan. 10 and delivered before March 12. From December to January 10, ESPO exports that loaded throughout the per- iod was supported by 27 tankers, ac- cording to a Bloomberg analysis. The traders and shippers said any shortage of the vessels could create bottlenecks, slow down loading and exporting from Kozmino and ultimately force Moscow to restrict flows. The only tanker sanctioned by the U.S. on Jan. 10 that has subsequently loaded a cargo of ESPO crude is the Li Bai. It remains anchored off Kozmino after completing loading operations Jan. 18, tracking data show. Separately, the sanctioned Zaliv Bai- kal took on a cargo of Sakhalin Blend crude from the Sakhalin 2 project Jan. 11. It completed offloading it at Lian- yungang on Sunday, in a move that would appear to breach the sanctions. Of the 10 un-sanctioned tankers near ESPO, Sai Baba had previously handled other Russian grades such as Urals that load from Primorsk, Ust Luga and Mur- mansk, but hadn’t previously touched ESPO since the Russian war. Others may also be rushing to Ko- zmino to help relieve any logistical challenge, possibly joining the fleet supporting flows as it faces a crunch that has sent chartering rates soaring. Last week, Bhilva u-turned in the Indi- an Ocean and is approaching the Strait of Malacca after briefly signalling its destination as Kozmino. — Bloomberg News SERENE CHEONG Scotiabank exits net-zero climate alliance TORONTO — Scotiabank is the latest major Canadian bank to withdraw from the Net-Zero Banking Alliance. It joins BMO, National Bank, TD Bank Group and CIBC in leaving the alliance. The Canadian banks started with- drawing not long after the six largest banks in the U.S. did the same as the presidential inauguration of Donald Trump loomed. The UN-backed initiative aims to ac- celerate climate action among financial institutions. A Scotiabank spokesperson said the bank is still committed to delivering its own climate transition plan, and remains committed to meeting the requirements of regulators around the globe. A spokesperson for RBC said the bank has nothing to add beyond com- ments made by CEO Dave McKay this month, when he said the alliance was in flux and questioned whether it was the right mechanism to reduce emissions. — The Canadian Press Grain, crop, container shipments up for Prince Rupert port PRINCE RUPERT, B.C. — The Port of Prince Rupert says cargo ship- ments were down by one per cent last year from 2023, but volume was up at terminals that ship containers, lique- fied petroleum gas and agricultural crops. The authority says in a statement 23.1 million tonnes of cargo moved through the port, with metallurgical coal exports falling by 29 per cent and thermal coal down by 22 per cent. Cruise passenger volume was also down by 27 per cent, with 59,400 pas- sengers transiting through the north- ern B.C. port in 2024, compared to 81,327 in 2023. However, the port says its grain terminal saw a 26 per cent increase in crop exports, container shipments rose five per cent and 2.3 million tonnes of liquefied petroleum gas was shipped for a 15 per cent year-over- year increase. The statement says that despite the slight decrease in annual volume, the port is improving its competitiveness by diversifying through the develop- ment of its new terminal and logis- tics capacity, allowing it to cushion against market fluctuations. — The Canadian Press ‘Valuable tool’: land-based aquaculture projects catching on in Japan J APAN’S NTT group companies are entering the land-based aquacul- ture business one after another. The companies are using their knowledge of information and communications technology to manage water quality and temperature, helping to efficiently grow shrimp, salmon and other fish. Land-based aquaculture does not re- quire fishing rights, and several new companies are entering the market. As it is less affected by the natural en- vironment, it is also expected to pro- vide a stable supply of seafood. NTT Green & Food, Inc. began oper- ating a land-based aquaculture facility in Iwata, Shizuoka Prefecture, in De- cember. The company has set up 26 tanks in a corner of a parts factory rented from Suzuki Motor Corp. The plan is to raise baby whiteleg shrimp for about four months before shipping them, aiming for the first shipment to be made within the fiscal year under the Fukuebi (lucky shrimp) brand name. Seawater pumped from underground is mixed with fresh water, and the water temperature and oxygen concen- tration are managed around the clock. The introduction of automatic controls using artificial intelligence is also under consideration. “Land-based aquaculture must faith- fully replicate the marine environment, and NTT’s information and communi- cation technology specialty will be a valuable tool,” said NTT Green & Food president Yoshikazu Kusumi. NTT Communications Corp. also established a land-based aquaculture subsidiary which began operations in December. Teaming up with an Okinawan com- pany that has its own filtration tech- nology, the subsidiary will develop sys- tems to improve production efficiency and provide aquaculture consulting services. NTT East Corp. is also working on land-based sockeye salmon farming in collaboration with the Okayama Uni- versity of Science and others. In recent years, major companies have been entering the land-based aquaculture business one after another, using AI and communications technol- ogy to accelerate growth and increase shipping volume through stringent management. SoftBank Corp. is also working on land-based farming of sturgeon which produce caviar. The Japanese company is conducting research into technology that uses AI to help identify fish with a large number of eggs. In other industries, Shikoku Railway Co. (JR Shikoku) entered the salmon farming business in August last year, shipping its first fish in December and selling them to hotels in Tokyo and other locations. Kyushu Electric Power Co. together with other companies has set up a land- based salmon farm on the grounds of a thermal power plant in Fukuoka Pre- fecture and began shipping salmon in October 2023. They are being sold at supermarkets and other outlets in the prefecture. Fish catches in Japan have been de- clining due to rising sea temperatures caused by global warming and over- fishing by foreign fishing boats. Japan’s food self-sufficiency rate on a caloric basis is a mere 38 per cent. Land-based aquaculture is expected to contribute to food security as a means of ensuring a stable supply of fish. — Japan News JAPAN NEWS Officials place baby shrimp in a tank at the NTT Group’s land-based aquaculture facility in Iwata, Shizuoka Prefecture, Japan. Loblaw says grocery price growth to remain elevated LOBLAW says a confluence of factors including a weak loonie mean grocery prices will continue to rise faster than overall inflation. Canada’s largest grocer released a report on food inflation the evening before Statistics Canada’s scheduled monthly Consumer Price Index report. Loblaw says many suppliers are still proposing price increases above infla- tion, while supply chain issues, a weak- er dollar and rising production costs are also making food more expensive. Canada’s major grocers have been under intense scrutiny from politicians and consumers in the wake of a bout of inflation that saw grocery prices go up more than 20 per cent over three years. The grocers have denied accusations of profiting from inflation, saying they face unreasonable requests from sup- pliers and have been doing their part to mitigate rising prices. In November, overall inflation de- clined to 1.9 per cent while grocery prices outpaced the headline number at 2.6 per cent. In March 2023, the government brought executives from the major gro- cers to Parliament Hill to answer ques- tions about how their profits squared with ballooning grocery costs. Loblaw’s report highlights several commodities that have seen particu- larly sharp price increases, including coffee and cocoa, which have seen their crops hit by poor weather. The grocer says the cost of beef has also climbed to all-time highs, while olive oil prices should ease somewhat after recent shortages. Since Canada imports much of its fresh produce from the U.S., especial- ly during the winter, a weaker loonie makes those products more expensive, Loblaw said in its report. “While food inflation has returned to more typical levels, grocery prices are still rising faster than overall inflation — a trend we expect to continue.” — The Canadian Press ROSA SABA ;