New Bitcoin addresses hits yearly high

https://www.theblock.co/post/240146/new-bitcoin-addresses-hits-yearly-high

The number of unique addresses on the Bitcoin network hit a high for the year, according to The Block’s data dashboard. 

The seven-day moving average for new addresses topped 500,000 for the first time this year, surpassing the previous high of 499,000 on April 8.

On July 12, the metric reached 501,440. That’s the highest level since May 2021.

The increase in new addresses has been underpinned by an appreciation in the price of the largest cryptocurrency, which has soared 43% this year. Trading on Monday was mostly muted, with the world’s largest crypto currency by market capitalization declining 0.3% to $30,212, according to CoinGecko.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

GBTC volumes surge to yearly high

https://www.theblock.co/post/239824/gbtc-volumes-surge-to-yearly-high?utm_source=rss&utm_medium=rss

Daily volume for Grayscale’s GBTC has been on a tear in the wake of a flurry of new spot exchange traded fund filings, hitting the highest level of the year on July 13.

As per The Block’s data dashboard, daily volumes for Grayscale’s largest fund product topped $183 million on July 13. On June 20, it topped $170 million. 

Grayscale, which is in the process of suing the Securities and Exchange Commission to upgrade GBTC into a proper spot bitcoin ETF, has seen the product’s discount to net-asset-value shrink since BlackRock’s surprise announcement that it would file for a spot bitcoin ETF on June 15. Across the crypto asset management space, issuers are racing to bring a product to market, kicking off a broader increase in inflows across existing products. 

The Block’s data dashboard shows the discount has tightened from -44% on June 13 to -28% on July 10. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Katie Haun: Appeal of recent XRP court decision seems ‘unlikely’

https://www.theblock.co/post/239817/katie-haun-appeal-of-recent-xrp-court-decision-seems-unlikely

Crypto venture investor and former Department of Justice prosecutor Katie Haun weighed in on a recent court decision in Ripple’s three year long legal battle with the Securities and Exchange Commission. 

In a tweet, Haun said that the court’s decision, which found that sales of XRP across public exchanges have not constituted the sale of unregistered securities, was “a good outcome for the industry.”

“The consensus is that the court drew a reasonable line—distinguishing between XRP itself (not an investment contract and thus not a security) and certain XRP transactions in which institutional investors paid money to Ripple directly and Ripple made contractual commitments in exchange, creating an investment contract under Howey,” Haun said in a tweet

Haun previously worked with Chris Dixon, running a16z’s crypto funds. She launched Haun Ventures, which reportedly raised more than $1 billioin in assets, in 2022. 

Haun said that an appeal of US District Judge Analisa Torres’s decision is “possible,” but added that an “immediate appeal seems unlikely both because the agency would have to ask the court to split this decision from the portion going to trial and because I am skeptical the SEC actually wants legal clarity.”

To be clear, Ripple’s battle with the SEC is far from over. Furthermore, Judge Torres also ruled that Ripple violated securities laws when it offloaded XRP to sophisticated institutional investors. 

Still, a number of market participants noted the development could bode well for other crypto firms in their own ongoing legal proceedings, with investment banking giant JPMorgan noting it could benefit Coinbase. 

“The ruling appears on the surface to be a win for Coinbase in its recent lawsuit by the SEC,” JPMorgan equity analysts led by Kenneth Worthington wrote in a report on Friday. “We see Coinbase in the best position to benefit from the improved confidence and regulatory clarity given Coinbase’s market-leading position and respected reputation in the industry.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto volumes increase post Ripple ruling

https://www.theblock.co/post/239808/crypto-volumes-increase-post-ripple-ruling

Crypto trading volumes across spot exchanges increased following a judge ruling that Ripple’s sales of XRP on public trading venues did not constitute the sale of securities. Data from The Block data dashboard shows the seven day moving average for spot trading volumes increased from $12.74bn on July 12 to $16.56bn.

While the future of the case — which could now go to trial or be appealed — is not clear, the market has rallied on the news with crypto equities like Coinbase and XRP surging in the wake of the ruling from a judge in New York’s Southern District.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Coinbase’s market cap relative to Uniswap surges

https://www.theblock.co/post/239778/coinbases-market-cap-relative-to-uniswap-surges?utm_source=rss&utm_medium=rss

The broader rally in global equities and cryptocurrencies has not helped the market capitalization of one of the decentralized finance market’s darlings. 

While Coinbase has seen its shares surge by more than 213% since the beginning of the year–supercharged by BlackRock’s surprise filing for a spot bitcoin exchange-traded fund–the market cap of DeFi exchange Uniswap hasn’t budged. The market cap of the DEX has held steady, hovering around $4 billion for much of the year. 

Coinbase, meanwhile, has seen its market cap increase from over $7 billion at the beginning of the year to nearly $25 billion on Friday. 

The Block’s data dashboard shows the ratio between the two firms’ market caps has surged, hitting a yearly high of 6.2 on July 13.

Coinbase rallied more than 20% on Thursday alongside the broader crypto market after a judge ruled that Ripple Lab’s sales of XRP on exchanges did not violate securities laws. 

Private investment firm WedBush said in a Thursday report that it increased its price target on the company to $110.

“We are specifically encouraged by the suggestion that XRP sale on the public exchanges did not involve securities,” the firm wrote.

Needbush also increased its price target to $120 from $70 following the decision, Coinbase reported.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Coinbase users in four states will no longer be able to stake additional assets

https://www.theblock.co/post/239734/coinbase-users-in-four-states-will-no-longer-be-able-to-stake-additional-assets?utm_source=rss&utm_medium=rss

Coinbase said retail clients in four states will no longer to be able to add new assets to its staking product while numerous legal proceedings carry on. 

Ten states — including Alabama, California, and New Jersey — filed actions against the exchange to halt its staking program within their jurisdictions on the heels of the Securities and Exchange Commission’s lawsuit against the firm in June.

The SEC and several states argue that the product constitutes a unregistered security offering. Coinbase claims staking is not a security, maintaining that it is a “core part of ensuring the cryptoeconomy functions for hundreds of millions of users around the globe.”

The firm has been engaged with policymakers across several states to keep its staking program intact for all users, but California, New Jersey, South Carolina, and Wisconsin will require the firm to stop processing additional staking assets for customers.

“Customers’ crypto that was staked before these orders were issued remains unaffected,” the company said in the Friday blog post. “Impacted customers have received an email with more information specific to their state, and all customers can visit our Help Center to learn more about these actions and the changes we will be implementing in the coming weeks in these four states.”

Coinbase staking services will operate normally in other states

Coinbase’s staking services will operate normally in the other states in which there are ongoing proceedings. 

“Staking is not some exotic or complex financial product,” the company said.

“In fact, it is not a financial product at all,” it continued. “Whether a user stakes on their own or through a service like ours, they remain the owner of their crypto at all times. Unlike lending, for example, there is no risk that a borrower will fail to repay, because the underlying crypto remains in custody from start to finish.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Coinbase stock surges more than 24% following XRP court ruling

https://www.theblock.co/post/239528/coinbase-stock-surges-more-than-24-following-xrp-court-ruling

Coinbase shares traded sharply higher on Thursday, breaching $100 per share for the first time in over a year after a U.S. federal court delivered a ruling on the Securities and Exchange Commission’s lawsuit against fintech firm Ripple Labs.

A mixed decision from the Southern District Court of New York indicated that secondary sales in XRP tokens did not constitute the sale of unregistered securities.

While the future of the case — which could now go to trial or be appealed — is not clear, Coinbase said that it will relist XRP. Shares in the exchange surged 24.5% to $107, according to TradingView.

XRP also had a banner day, rising as much as 80%.

Source: TradingView

Thursday’s gains add to Coinbase’s 2023 rally, which was super charged by BlackRock’s filing for a spot bitcoin exchange-traded fund on June 15. The exchange’s stock, which has risen 193% so far this year, has been further bolstered by headlines that it would serve as the market surveillance partner for a number of exchanges in the race to launch such a product. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Coinbase will re-enable trading for XRP after mixed court ruling

https://www.theblock.co/post/239522/coinbase-will-re-enable-trading-for-xrp-after-mixed-court-ruling?utm_source=rss&utm_medium=rss

Coinbase said Thursday that it will re-enable trading of XRP after a federal court ruled that some transactions on exchanges didn’t constitute the sale of securities. 

“Coinbase will re-enable trading for XRP (XRP) on the XRP network,” the company said in a tweet. “Do not send this asset over other networks or your funds may be lost. Transfers for this asset remain available on @Coinbase & @CoinbaseExch in the regions where trading is supported.”

“Trading is anticipated to begin later today, if liquidity conditions are met,” the exchange continued. “Once sufficient supply of this asset is established trading on our XRP-USD, XRP-USDT and XRP-EUR trading pairs will launch in phases. Support for XRP may be restricted in some supported jurisdictions.”

After the mixed ruling from the Southern District Court of New York in the lawsuit between the Securities and Exchange Commission and Ripple Labs, the case could now go to trial or be appealed. A wide-range of U.S.-based cryptocurrency exchanges halted trading in XRP at the end of 2020 when the agency first sued Ripple.

A number of trading firms had also stopped making markets for the token, which is closely associated with Ripple. 

“We’ve read Judge Torres’ thoughtful decision,”  Coinbase Chief Legal Officer Paul Grewal said on Twitter. “We’ve carefully reviewed our analysis. It’s time to relist.”

Gemini is also exploring listing of XRP

Crypto exchange Gemini said earlier Thursday that it was exploring relisting XRP.

“Given today’s ruling that the sale of XRP on exchanges is not a security, @Gemini is exploring the listing of XRP for both spot and derivatives trading,” the firm said in a tweet.

XRP appreciated by more than 80% on Thursday, hitting its highest level since April 2022. 

(Updates with tweet from legal officer.)

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Circle cuts ‘marginal’ amount of staff to strengthen balance sheet: CoinDesk

https://www.theblock.co/post/239277/circle-cuts-marginal-amount-of-staff-to-strengthen-balance-sheet-coindesk

Circle has laid off a portion of its workforce to strengthen its balance sheet, CoinDesk reported.

The firm, which is best known for launching stablecoin USDC, told CoinDesk that the staff cut would allow it to “focus on core business activities and execution.”

“We have reduced or ended investments in non-core activities and reduced operational expenses which includes a marginal reduction in headcount,” the firm added. “At the same time, we have identified new areas for investment and are continuing to hire in key areas of focus on a global basis.”

Circle has made headlines in recent weeks for a number of big ticket hires and appointments including former U.S. Commodities Futures Trading Commission head Heath Tarbert, who joined the firm as its chief legal officer and head of corporate affairs at the beginning of July. Goldman Sachs’ former chief risk officer, Craig Broderick, who retired from the bank after 32 years in January, joined Circle’s board of directors at the end of June. 

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto crime down by more than 65%, Chainalysis says

https://www.theblock.co/post/239256/crypto-crime-down-by-more-than-65-chainalysis-says

Crypto-related crime has declined significantly, according to data from Chainalysis.

A new report from the analytics firm notes that daily crypto inflows into illicit services is down relative to previous years. From the beginning of the year through June, crypto inflows into illicit entities, which covers sanctioned individuals or groups, is down 65% from the same period last year.

The report notes that the drawdown in illicit crypto transactions outpaced the broader decline in crypto transactions tied to the slump in token prices.

“Transaction volumes are down across the board, but declines are much less severe for legitimate services, which have seen just a 28% drop in inflows,” the firm said. 

“In other words, there’s been a market pullback, but illicit crypto transaction volume is falling much more than legitimate crypto transaction volume.”

Ransomware bucks the trend

Still, ransomware attacks are a crypto-based form of crime that is increasing in prevalence. Chainalysis found that ransomware attackers are on track for their second-biggest year on record, having siphoned about $449.1 million since the beginning of the year through June. 

“If this pace continues, ransomware attackers will extort $898.6 million from victims in 2023, trailing only 2021’s $939.9 million,” the firm said. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Berenberg Capital Markets lifts price target for MicroStrategy to $510

https://www.theblock.co/post/239119/berenberg-capital-markets-lifts-price-target-for-microstrategy-to-510

Analysts at Berenberg Capital Markets have increased their price target for software firm MicroStrategy to $510 from $430.

In a note to clients, the firm said that it reiterated its “buy” rating for the company, raising its price target due to an increasingly more favorable environment for bitcoin’s institutional adoption. 

“Based on the faster-than-expected pace at which MSTR has acquired bitcoins since we initiated coverage of the company on April 27, as well our view that the prospects for institutional adoption of bitcoin have improved meaningfully in the interim, we are raising our estimate of the value of the company’s bitcoin holdings as of late-April 2024 to $8.74 billion from $6.27 billion,” the firm said. 

On June 28, MicroStrategy bought another 12,333 bitcoin for a total price of $347 million. 

MicroStrategy and Saylor remain extremely bullish on bitcoin.

“The conviction in our bitcoin strategy remains strong as the digital asset environment continues to mature,” MicroStrategy CEO Phong Le said last month.

The firm’s stock has appreciated by more than 180% since the beginning of the year. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Former FTX exec probed over possible campaign finance violations: WSJ

https://www.theblock.co/post/238989/former-ftx-exec-probed-over-possible-campaign-finance-violations-wsj

Federal prosecutors are investigating former FTX executive Ryan Salame’s involvement in Michelle Bond’s 2022 congressional race, according to a report by the Wall Street Journal. 

As per the report, Manhattan prosecutors are investigating Salame for possible violations of campaign-finance laws tied to his support of girlfriend Bond, who ran in the Republican primary for New York’s first congressional district. The investigation, which dates back to at least April, is examining the funds Salame gave to Bond as well as the loans that funded her campaign, a source told The Journal. 

Bond, who ran on a conservative platform, raised over $660,000 in contributions including $54,000 from Salame. She was endorsed by Donald Trump Jr. and Texas Senator Ted Cruz. 

The investigation into the financial relationship between Salame and Bond is separate from the ongoing case against FTX cofounder Sam Bankman-Fried, who is charged with improperly spending customer deposits. Salame is not charged in that case. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Coinbase shares surge as agreements for spot bitcoin ETFs are confirmed

https://www.theblock.co/post/238983/coinbase-shares-surge-as-agreements-for-spot-bitcoin-etfs-are-confirmed

Coinbase shares rose as much as 11% amid confirmation that trading giant Cboe would rely on the crypto exchange to surveil market manipulation for proposed exchange-traded funds to be listed on its venue.

Cboe on Tuesday submitted amendments for five proposed spot bitcoin ETFs to say that it has “reached an agreement on terms” with Coinbase to enter into surveillance sharing agreements.

Shares were up 9.9% to $89.25 at 1:11 p.m. in New York, according to TradingView.

TradingView
Source: TradingView

Tuesday’s rally adds to gains clocked in by the crypto exchange since the beginning of the year, which ratcheted up after BlackRock announced it would file for a spot bitcoin ETF. The firm’s stock is up 144% since the beginning of the year. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Bitcoin halving underpins bull case for Microstrategy, Berenberg says

https://www.theblock.co/post/238784/bitcoin-halving-underpins-bull-case-for-microstrategy-berenberg-says

Berenberg Capital Market’s bull case for Michael Saylor’s Microstrategy is underpinned by the upcoming Bitcoin halving, the firm said in a research note shared with The Block Monday. 

The equity research shop, which has a bullish price target of $430 for the Virginia-based software firm, said in the note that the firm derives most of its value from the more than 150,000 bitcoin it holds on its balance sheet, adding that it expects the historical trend of bitcoin rallying post-halving to play out again. 

Halving events reduce the rate of new coin issuance by 50%, effectively decelerating the pace at which new tokens enter the market. The fourth Bitcoin halving is expected to occur on April 26, 2024.

Pre-halving rally

“If the historical pattern established by the first three bitcoin halvings continues to play out with the fourth halving, then the pre-halving rally would begin about four months from now,” the firm wrote. “If a rally were to occur after the fourth halving, and if it were as long-lived as the rallies that occurred after the past couple of halvings, then it would continue until around October 2025.”

“If the fourth bitcoin halving features the kind of strong rally in the price of bitcoin that occurred prior to and following the first three halvings, then we believe it is likely that MSTR’s stock would rally along with it; the correlation between the company’s share price and the price of bitcoin is ~0.90,” the firm added.

Microstrategy is up more than 181% since the beginning of the year, according to TradingView. It increased 7% on Monday to close the day at $407.71.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Standard Chartered revises bitcoin price target to $120,000

https://www.theblock.co/post/238778/standard-chartered-revises-bitcoin-price-target-to-120000

The largest cryptocurrency by market capitalization could appreciate in price by nearly $100,000 by the end of 2024, according to financial services giant Standard Chartered Bank. 

In a Monday research report, the UK-based global banking giant said that it increased its bitcoin price target from $100,000 — which it forecasted in April — to $120,000. The firm said the price of bitcoin could increase to $50,000 by the end of 2023.

The report points to an increase in miner profitability as one potential tailwind that could trigger an appreciation in the price of the cryptocurrency. 

“The rationale here is that as well as maintaining the bitcoin ledger, miners play a key role in determining net supply of newly mined BTC,” said Geoff Kendrick, head of FX and digital assets research at the firm.

Bitcoin was trading up 2.3% to $30,865 Monday afternoon in New York, adding to gains since the beginning of the year that’s brought it to appreciate by about 48%, according to CoinGecko.  

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Framework’s Vance Spencer thinks crypto market sentiment is still ‘catatonic’

https://www.theblock.co/post/238771/frameworks-vance-spencer-thinks-crypto-market-sentiment-is-still-catatonic?utm_source=rss&utm_medium=rss

Crypto venture investor Vance Spencer took to Twitter on Monday to outline how the industry writ large may not fully appreciate the bullish forces at play in the market.

The co-founder of Framework Ventures noted that market sentiment “remains catatonic,” namely because a number of crypto native firms are still “nursing their wounds” from the previous year while TradFi firms remain underexposed. 

The comments come as a wide range of asset managers prepare to enter the market with new spot bitcoin exchange-traded funds, which Spencer expects to hit the market by the end of the year even though they have yet to be approved by regulators. It’s a development he believes will open the door to “ETF opportunities for other cryptoassets.”

“Crypto is in a far better place than anyone gives it credit for,” Spencer said. “History is on our side; we are replacing the financial system with software that nobody and everybody controls. Excited for the next few years and decades.”

Ethereum transition

Speaking on Ethereum, Spencer said that the blockchain’s successful transition to proof-of-stake from proof-of-work has caught the attention of major banking firms.

“The economics of the ETH have been noticed by major banks, and research reports have started to trickle out,” he wrote. “There are 3 DeFi apps that are tracking to $100M of ARR this year (in a bear market), and 1-2 of those have a line of sight to $1Bn of 95% margin ARR (in a bull market).”

The price of cryptoassets like ether are up significantly from all-time lows but still down more than 50% of the highs. Increased prices in various tokens have also yet to translate into a more active private market, with venture activity still stuck in the doldrums. 

As previously reported by The Block, web3 venture funding plummeted in the first quarter of 2023, down 80% from the same period a year earlier.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

RFK Jr. is a bitcoin bag holder despite May conference speech

https://www.theblock.co/post/238537/rfk-jr-is-a-bitcoin-bag-holder-despite-may-conference-speech

Democratic U.S. presidential candidate Robert F. Kennedy Jr. told revelers at a May conference in Miami that he was not a bitcoin investor, but June financial documents revealed he has a bag, according to a report by CNBC

As per financial documents filed on June 30, the nephew of former president John F. Kennedy has between $100,001 and $250,000 worth of bitcoin held within a brokerage account. A representative for the presidential hopeful told CNBC that the investment was made after a pro-Bitcoin speech he delivered at Bitcoin Miami. The representative also said the investment does not represent a conflict of interest. 

As CNBC noted, Kennedy is a proponent of bitcoin, tweeting that “Bitcoin is not only a bulwark against totalitarianism and the manipulation of our money supply, it points the way toward a future in which government institutions are more transparent and more democratic.”

Kennedy’s campaign first told CNBC that the investment was made by his wife, former “Curb Your Enthusiasm” actress Cheryl Hines, but later confirmed that it belonged to the presidential candidate. 

Kennedy is part of a cadre of pro-crypto candidates that spans Republican Senator Ted Cruz and other presidential hopefuls like Florida governor Ron DeSantis. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Spot crypto exchange volumes trending lower

https://www.theblock.co/post/238531/crypto-exchange-volumes-trending-lower

The spot bitcoin exchange-traded fund-fueled rally has stopped translating into increasing crypto exchange volumes, data from The Block Research shows. 

The seven day moving average for daily crypto exchange volumes has declined from a recent high of $19.4 billion on June 27 to $14.2 billion on July 8, according to The Block’s data dashboard. It was slightly over $15 billion on Friday. 

The price of bitcoin, meanwhile, is relatively flat over the same time period. The sluggish activity in spot exchange crypto trading could suggest that activity has moved into derivatives or off-exchange. Since BlackRock submitted its filing for a spot bitcoin ETF on June 15, the price of bitcoin has appreciated by more than 18%.

Meanwhile, CME’s bitcoin futures market has seen open interest surge, with the metric hitting $2.7 billion at the time of writing. 

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Spot trading pairs decline across exchanges

https://www.theblock.co/post/238519/spot-trading-pairs-decline-across-exchanges?utm_source=rss&utm_medium=rss

Cryptocurrency traders have fewer pairs to punt.

The number of spot pairs across major cryptocurrency exchanges has declined since the beginning of the year, according to data compiled by The Block Research. 

Monthly spot pairs on Binance, the largest exchange by global volume, fell from 1,470 to 1,380, according to The Block data. Its sister company, BinanceUS, saw monthly spot pairs decline from 337 in June to 184 in July.

The crypto market has seen exchanges end support for trading pairs in the wake of the U.S. Securities and Exchange Commission’s suits against Coinbase and Binance earlier in June. The agency alleges that the exchanges traded unregistered securities. 

The number of spot pairs has also declined at Kraken, with the number of pairs declining from a high of 668 in February to 651 in July. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Tether freezes $2.5 million of USDT transferred from Multichain

https://www.theblock.co/post/238517/tether-freezes-2-5-million-of-usdt-transferred-from-multichain?utm_source=rss&utm_medium=rss

Stablecoin issuer Tether has frozen $2.5 million of USDT tied to a likely exploit of cross-chain router protocol Multichain. 

Multichain’s Fantom bridge was seemingly exploited for nearly $130 million after an attack that siphoned assets from a number of bridges. That amounted to nearly the entirety of the project’s wBTC, USDC, and USDT. Strangely, not all tokens in the bridge were taken and the assets weren’t sold (which typically happens during an attack).

On Friday, the Fantom Foundation said that Circle had frozen three addresses containing $60 million worth of USDC on Ethereum. 

Multichain said it was aware of the abnormal behavior and that it is investigating. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Binance marketshare at lowest point since beginning of the year

https://www.theblock.co/post/238502/binance-marketshare-at-lowest-point-since-beginning-of-the-year?utm_source=rss&utm_medium=rss

Binance, the largest global cryptocurrency exchange, faces a dwindling marketshare as executives from the firm depart, according to data from The Block’s data dashboard. 

Top executives at Binance resigned this week over CEO Changpeng Zhao’s handling of regulatory investigations into the company, Fortune reported, citing sources. Senior officials at the company including general counsel Han Ng, chief strategy officer Patrick Hillmann and SVP for compliance Steven Christie told Zhao they are leaving the company, Fortune said.

The exits come amid a dip in Binance’s marketshare among global exchanges. The firm saw its market share fall from 72% in January to just over 58% at present.

The figures represent the marketshare of spot trade volumes for cryptocurrency exchanges with no USD support or USD pairs contributing insignificant volumes.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Lightning Labs releases new Bitcoin tools for AI development

https://www.theblock.co/post/238250/lightning-labs-releases-new-bitcoin-tools-for-ai-development

Lightning Labs, the firm building out the Bitcoin Lightning Network, has unveiled a new suite of tools designed for AI development.

The tools, which include LangChainBitcoin, aim to enable developers to seamlessly integrate Bitcoin and Lightning into their AI applications. The suite includes LLM Agent BitcoinTools, which allows developers to create AI agents that can hold bitcoin balances, send/receive bitcoin on Lightning and interact with Lightning Network Daemon nodes.

Additionally, the release includes the Aperture reverse proxy server, which supports Lightning Node Connect and offers dynamic API endpoint pricing.

The tools are expected to enhance accessibility and functionality in AI infrastructure, while leveraging the power of Bitcoin and Lightning.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Bitcoin can no longer be considered ‘passing fad,’ says Grayscale CEO

https://www.theblock.co/post/238228/bitcoin-can-no-longer-be-considered-passing-fad-says-grayscale-ceo

The entrance of large investment firms like BlackRock and Fidelity into the race to launch a spot bitcoin ETF fund illustrates the extent to which bitcoin is no longer “a passing fad,” according to Grayscale chief executive Michael Sonnenshein. 

The leader of the largest crypto asset manager told The Block that “market participants are reacting favorably to the entrance of legacy financial institutions into Bitcoin — a trend that lends further validity to an asset that was once believed to be a passing fad,” he said. 

Indeed, on Wednesday the CEO of BlackRock — which submitted a surprise filing for a spot bitcoin ETF in mid-June — told Fox Business that bitcoin was equivalent to digital gold. Ironically, that echoes the underpinning thesis of a 2020 marketing campaign run by Grayscale. 

In 2017, BlackRock CEO Larry Fink described bitcoin as “an index of money laundering.”

Bitcoin staying power

“Recent news of new entrants into Bitcoin underscores the staying power of this asset class, more broadly, and many investors view this as a once in a generation investment opportunity,” Sonnenshein added, referring to the surge in competition in the crypto asset management space. 

Grayscale, which is vying to upgrade its flagship GBTC into a spot bitcoin fund, has seen its estimated revenue from its main products GBTC and ETHE hit a monthly high for the year this June. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto sector ‘ripe’ for M&A disputes: new report

https://www.theblock.co/post/238197/crypto-sector-ripe-for-ma-disputes-new-report

The digital asset industry seems the most ripe for M&A disputes, according to a newly released report by Berkeley Research Group. 

The firm’s mid-year merger and acquisition disputes report noted that 43% of surveyed dealmaking professionals expected an increase in M&A disputes in the sector — the highest of any other industry studied in the report. 

chart
Source: BRG Group

“Deals in digital assets and services are ripe for disputes as market volatility and proposed regulations disrupt cryptocurrency activity,” the report noted.

The sector has witnessed a number of big ticket deals fall apart in the wake of the crypto credit crisis and meltdown of the FTX crypto exchange. In August 2022, Mike Novogratz’s Galaxy Digital called off its $1.2 billion deal to acquire custody provider BitGo. More recently, BitGo said it would not go through with its plan to acquire beleaguered Prime Trust. 

BitGo’s suit against Galaxy over the cancelled transaction was recently dismissed by a Delaware court. 

Crypto lifecycle 

“The cryptocurrency industry is at a point in its lifecycle where we’ve seen a high degree of new development — companies sprouting up left and right as coin values were high and speculative conditions were optimistic — and now there’s a greater move towards consolidation, both as the industry matures and as macroeconomic headwinds shift,” noted BRG Managing Director Albert Metz.

“When coupled with depressed values among major cryptocurrencies complicating profitability, this is an environment which can generate more disputes.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Binance seeks European policy officer amid setbacks in France, Netherlands

https://www.theblock.co/post/238002/binance-seeks-european-policy-officer-amid-setbacks-in-france-netherlands

Crypto behemoth Binance is seeking a new policy officer for its European operations, following a number of major setbacks on the continent. 

The new hire would “develop and write new policies, standards, guidelines, and procedures for the firm,” a recent job advertisement notes

The past few weeks have been complicated for the exchange in the region, with media in France reporting that the company is under investigation by authorities in the country. Binance confirmed that authorities visited its offices in June. 

In the UK, the country’s financial watchdog said in June that its local division was not permitted to offer services in the country. The company also announced its departure from the Netherlands last month after it was unable to secure a license from the country’s central bank. 

Other Binance jobs also posted

The new policy hire will be tasked with articulating “complex information clearly and persuasively.” 

The global exchange has a number of international job ads posted, including one for a government affairs associate director in Spain and compliance director in Thailand. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Coinbase ends trading session lower following downgrade

https://www.theblock.co/post/237995/coinbase-ends-trading-session-lower-following-downgrade

Coinbase shares ended Wednesday lower by nearly 2%, despite a more bullish start to the week that was kicked off with headlines the exchange is partnering with several asset managers on new spot bitcoin exchange-traded funds awaiting approval from the U.S. Securities and Exchange Commission. 

The stock was trading down 1.98% to $78.35 per share at close, dragged down by a new downgrade from analysts at Piper Sandler. It has appreciated 133% since the beginning of the year. 

COIN shares
Source: TradingView

The exchange, which has pared losses since the SEC announced a lawsuit against the firm, still faces “too much uncertainty to prudently project revenues in future years,” according to analyst Patrick Moley. Piper Sandler previously had an overweight position for the stock. 

Bloomberg News reported the downgrade earlier in the day. 

Coinbase faces lawsuit from SEC

The SEC alleged in June that Coinbase trades unregistered securities and operates a business that merges functions “that are typically separated in traditional securities markets.”

Still, a wide-range of issuers, including asset management giant Fidelity, have identified Coinbase has a partner in their plans to launch a spot bitcoin ETF. BlackRock, which filed its spot bitcoin ETF on June 15, has picked the exchange as its custodian. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Regulatory ambiguity hurts Americans, says SEC Commissioner Hester Peirce

https://www.theblock.co/post/237988/regulatory-ambiguity-hurts-americans-says-sec-commissioner-hester-peirce

U.S. Securities and Exchange Commissioner Hester Peirce thinks that regulatory ambiguity is harming American investors, according to a wide-ranging interview with Coinage Media. 

Speaking to Coinage co-founder and former Yahoo Finance reporter Zack Guzman, the Republican commissioner weighed in on the ongoing race to launch a spot bitcoin exchange-traded fund, noting that standards applied to such a product have been “a moving target” and “not consistent with how we’ve treated other products.”

The SEC, which approved a futures-based exchange-traded fund for bitcoin, has a flurry of new spot bitcoin ETF applications to sift through, with companies ranging from BlackRock to Bitwise recently submitting filings. The agency has yet to approve a spot product, and has in the past cited concerns of manipulation in the underlying spot market. 

Advocates for a spot ETF have argued that futures-based ETFs also relies on pricing from underlying spot exchange venues. The recent round of filings identify partnerships with Coinbase for market surveillance to potentially mollify that concern. 

Regulatory ambiguity

“In other countries there are spot products that have been approved for a long time and there’s a lot of demand for spot products and I think if you look at the rationale for approving a futures product, it would seem that you could apply that same rationale and apply it a spot product,” Peirce commented. 

Furthermore, the Commissioner added that “regulatory ambiguity” stemming from the SEC is not beneficial to Americans. 

“I know there are a lot of people who are very critical of the SEC, and I’m quite critical often of my own agency as well,” she said. “And I think one of the reasons that I’ve been critical and that some others have been critical is that in the absence of a regulatory framework that makes sense.”

That ambiguity might force companies or projects to spend unnecessary timing weighing options to leave the U.S., comply, or shut down entirely. 

“I don’t think that it serves the American public to keep this sort of regulatory ambiguity so that you can come in after the fact with enforcement,” she said. “Why not have some regulatory clarity?”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Traders flocking back to centralized exchanges amid bitcoin rally

https://www.theblock.co/post/237727/traders-flocking-back-to-centralized-exchanges-amid-bitcoin-rally

As the memecoin frenzy gave way to spot exchange-trade fund exhuberance in the crypto market, traders increasingly flocked from decentralized trading venues to centralized ones, The Block’s Data Dashboard data shows. 

Monthly decentralized exchange volumes relative to their centralized counterparts declined sharply between May and June, declining from 22% 16.8%. Four days into July, the ratio has dropped further, falling to just under 14%. 

The surge in popularity of DEXes in May was well-documented, with The Block previously reporting that traders flocked to decentralized venues to punt memecoins. Volumes on Ethereum-based DEXes for trading of the memecoin Pepe surged above $600 million on May 5. 

The newfound interest in large caps like Bitcoin and Ethereum, kicked off by BlackRock’s surprise spot bitcoin exchange-traded fund filing on June 15, appears to have lured institutional investors to the market’s centralized venues. Bitcoin is up more than 20% since BlackRock’s filing. 

Institutional interest in crypto

Devin Ryan of equity research shop JMP attributed the recent increase in trading volumes to institutions entering the space.

“We believe the uptick in trading volume during the week ended 6/24, which was accompanied by a 12% W/W appreciation in total crypto market cap, can likely be attributed to some momentum in the space after BlackRock (BLK, NC) filed an application with the SEC for a spot Bitcoin ETF,” he said, referring to the asset manager’s June 15 filing. 

In the wake of BlackRock’s filing on June 15, a wide range of companies from WisdomTree to Invesco to Bitwise have refiled their own applications for funds to track the price of the largest cryptocurrency.

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto comeback pushes ProShare’s AuM for bitcoin futures ETF over $1 billion

https://www.theblock.co/post/237717/crypto-comeback-pushes-proshares-aum-for-bitcoin-futures-etf-over-1-billion

The crypto market rally kicked off by BlackRock’s surprise spot bitcoin exchange-trade fund filing has brought tens of millions of new inflows into a futures-based fund managed by ProShares.

ProShare’s BITO fund saw an additional $14.9 million of inflows on June 29 and $11.9 million of inflows on July 3, bringing its total assets under management to $1.04 billion, according to ETF.com. By way of comparison, the fund’s AuM on June 15 — the day on which BlackRock’s ETF application was submitted — stood at $822 million. 

ProShare’s futures-based fund made its market debut in late 2021. There’s a long list of issuers vying to launch a spot bitcoin ETF, which could bring further legitimacy to bitcoin as well as its underpinning market structure. The U.S. Securities and Exchange Commission has historically denied such a product because of a lack of proper surveillance across spot trading venues.

As noted by European asset manager CoinShares, the crypto fund space has benefited from the excitement around a spot bitcoin ETF coming to market. Weekly inflows into crypto asset management products were strong for the second week in a row, with CoinShares reporting $125 million coming into the industry last week. That brought total inflows into such products to $334 million over the past two weeks, according to the European asset manager. 

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto market comeback hasn’t helped stablecoin volumes, says Fitch

https://www.theblock.co/post/237697/crypto-market-comeback-hasnt-helped-stablecoin-volumes-says-fitch

There’s one sector of the crypto market that hasn’t fully benefited from the widespread rally that’s sent the price of bitcoin to near all-time highs for the year: stablecoins. 

As noted in a report by ratings agency Fitch, volumes in stablecoins and the aggregate market capitalization of the sector is lower. The Block’s data dashboard shows total stablecoin supply has declined from $138 billion at the start of the year to $124 billion on July 3. 

To be clear, Tether’s USDT has bucked this trend — picking up market share from its rivals since USDC’s de-pegging event in March. 

Still, the monthly average of daily trading volumes of the top ten stablecoins declined from $53 billion in March 2023 to $28 billion in May. 

However, Fitch notes that there is better liquidity in the assets backing stablecoins. Stablecoins are meant to trade one to one against a fiat currency — typically the US dollar — but are not backed exclusively by them. The underpinnings of stablecoins include a wide range of assets with different liquidity profiles. 

“Within USDT’s reserve portfolio, the portion of treasury bills and repos rose by 6pp and 5pp in 1Q, respectively, reaching 65% and 10% of reserves by end-1Q23,” the firm noted. 

Binance also improved the liquidity position of its stablecoins. “The repos in the portfolio are overcollateralized by long-term US treasury securities and are callable daily,” Fitch said. 

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.