CoinDesk Crypto

U.S. clients of Compass Mining can now avoid tax on the bitcoin they mine by buying mining hardware through their individual retirement accounts (IRAs).

• Through an agreement with Choice IRA, a crypto-friendly retirement offering by digital asset custodian Kingdom Trust, Compass clients can mine bitcoin without triggering a taxable event.
• Compass provides individual miners with a hosting facility and operates their hardware for them, in what could be seen as an Airbnb-esque model for mining facilities.
• The miners might be discouraged by having to pay tax twice: once as income on the bitcoin they mine and again on the capital gains when they sell.
• The Compass arrangement allows clients to circumvent this requirement by buying mining hardware with funds in their Choice IRA, which then receives the payouts.

CORRECTION (JULY 29, 16:01 UTC): Corrects that mining hardware needs to be bought through the IRA.

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U.S. clients of Compass Mining can now avoid tax on the bitcoin they mine by sending them direct to individual retirement accounts (IRAs).

• Through a partnership with Choice IRA, a crypto-friendly retirement offering by digital asset custodian Kingdom Trust, Compass clients can mine bitcoin without triggering a taxable event.
• Compass provides individual miners with a hosting facility and operates their hardware for them, in what could be seen as an Airbnb-esque model for mining facilities.
• The miners might be discouraged by having to pay tax twice: once as income on the bitcoin they mine and again on the capital gains when they sell.
• The Compass arrangement allows clients to circumvent this requirement by mining direct to an account with Choice IRA by purchasing mining hardware with funds in their Choice account.

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FTX.US, the U.S. affiliate of cryptocurrency exchange FTX, has reported 150-times growth in average daily volume in the first half of 2021 compared to last year.

• The exchange carried a daily volume ranging between ~$150 million and ~$1 billion during this period, hitting a high of $993 million on April 22, the company said Thursday.
• Bitcoin, the world’s largest cryptocurrency by market value, was priced at around $54,000 at the time, having been north of $63,000 less than a week earlier.
• FTX also cited its lively marketing strategy in its mid-year operational update which appears to be bearing fruit in placing itself front and center before a mass audience.
• So far this year, the company has bought the naming rights to the National Basketball Association’s Miami Heat’s home arena, entered into a partnership with Major League Baseball to have its branding on umpires’ uniforms and announced an equity stake deal with Tom Brady and Gisele Bundchen.
• FTX CEO Sam Bankman-Fried told CoinDesk TV a week ago of the Hong Kong-based firm’s plans to expand its business in the U.S.
• “There isn’t nearly as much business going on right now as you would expect given the size of the economy,” he said. “A lot of that is regulatory. It’s something that we’re working on there.”

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Ascensive Assets, an investment firm led by former professional poker players, has raised a $130 million fund that will focus on the decentralized finance (DeFi) market.

The latest fund dwarfs Ascensive’s maiden $24 million fundraise back in 2019, which backed the likes of Polkaswap, Benqi, Yield Guild Games and JennyDAO.

In terms of investors, the round was mostly populated by high-net-worth individuals from China, Hong Kong, Macau, Singapore and Malaysia, many of whom are connected to the world of professional poker and gambling, said Ascensive Assets partner Oliver Blakey.

Related: Finding Alpha in DeFi

“They are casino owners, private bookmakers and Asian high-net-worth individuals generally from the gambling world,” Blakey told CoinDesk in an interview. “A gambling mentality is in their DNA, I guess. We have always known that world and of course everybody wants exposure to this industry now.”

Around a third of the new fund will go towards early-stage startups, and the remainder is basically doubling down on winners from the first fund, said Blakey, who is refreshingly candid about the firm’s investment performance.

For example, he laments missing out on early rounds in Axie Infinity, but says Ascensive was “insanely lucky” to get into Yield Guild Games at the right time.

“We’ve made some awesome investments, we’ve also made some terrible ones,” Blakey said. “I think about this industry as a kind of hybrid of venture capital and a hedge fund; it’s somewhere in the middle.”

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Fintech platform COTI revamped the Crypto Volatility Index (CVI) to offer a set of new features including USDC support for staking.

• The gauge is designed to indicate the level of implied volatility in the crypto market through a decentralized index from crypto options prices. It is similar to the VIX volatility index, often called the fear index, on the S&P 500.
• “A challenge is the creation of a platform and ecosystem to trade the index,” a COTI spokesperson told CoinDesk. “The problem here is what works for the VIX cannot work for crypto markets, since the market would always be off balance and illiquid. We solved this by creating an AMM [automated market maker] and [self-adjusting] volatility tokens.”
• Staking is fundamental to how the index works because users must be incentivized to make it work, the spokesperson told CoinDesk.
• With the enhancement, users can open USDC positions and stake CVI USDC through the index, an emailed announcement Thursday said.
• Introduced in October 2020, the index initially supported trades and deposits in either ether or tether.
• Volatility tokens have also been introduced as part of CVI 2.0 to be used as a hedging tool by investors.
• The first such token is USDC-ETH, which can be be traded on all Ethereum-based decentralized exchanges.
• CVI 2.0 also includes margin trading on the Polygon network, allowing users to access greater sums of capital.

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Paxos – a provider of blockchain infrastructure – said Bank of America, crypto exchange FTX, Founders Fund and Coinbase Ventures were among a heavyweight list of investors in its $300 million Series D funding round, the firm disclosed on Thursday.

Oak HC/FT led the funding round, which the nine-year-old company announced in late April at a valuation of $2.4 billion. The round also included PayPal Ventures and Mithril Capital, among others. The firm has raised more than $540 million over multiple funding rounds.

The company noted that Bank of America joined the Paxos Settlement Service earlier this year. The platform uses blockchain technology to achieve same-day settlement of stock trades.

Related: FTX US Affiliate Sees Record Daily Trading Volume in First Half of 2021

“We’re defining this space and are excited to grow our enterprise solutions beside these market leaders,” Paxos CEO and co-founder Charles Cascarilla said in a press release.

Paxos started providing infrastructure for PayPal’s crypto service last year, which has extended to PayPal’s Venmo payments app. Credit Suisse, fintech Revolut and Societe Generale are among other customers.

In an April interview with CoinDesk, Cascarilla called the latest funding round “confidence capital” that would give customers certainty that Paxos would “be around for the next five to 10 years.”

In a statement, Founders Fund partner Napoleon Ta called Paxos “a trusted operator in blockchain-based financial market infrastructure,” highlighting “its commitment to regulation, reliability and security for enterprises entering digital asset markets.”

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The number of crypto users doubled in the first half, according to Crypto.com.

• Research carried out by the exchange identified more than 220 million users of crypto by the end of June, according to an emailed statement.
• The company said it used on-chain data and other parameters to compile the figures from 24 of the largest crypto platforms.
• February to May was particularly active, with numbers surging to 203 million from 106 million. Much of the growth during May, when China’s clampdown on bitcoin miners tightened and Tesla CEO Elon Musk commented on bitcoin’s carbon footprint, came from adoption of altcoins. The share of altcoin holders increased from as low as 20% of the total between January and April to about 37% in May and June.
• The figure compares with the nine months it took for the user base to reach 100 million from 65 million.
• “The growth we have seen in the first half of 2021 on our platform and industry-wide is very encouraging, and we will continue investing heavily as we pursue our goal of putting cryptocurrency in every wallet,” Crypto.com CEO Kris Marszalek said in the statement.

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Singapore-based lender Vauld raised $25 million in Series A funding to expand its retail crypto banking platform in a round led by Peter Thiel-founded Valar Ventures.

• Existing investors Pantera Capital and Coinbase Ventures also participated, the company said Thursday.
• Vauld, most of whose team is located in India, forms part of the broader picture of crypto firms seeking the appropriate licensing and registration to operate as fully fledged banks offering lending and savings products.
• As well as building out its platform, Vauld intends to use the investment to drive international expansion.
• Having established a foothold in India, the firm told CoinDesk in December 2020 that it intends to expand its licensing to other markets such as Singapore, the U.K. and the crypto-friendly U.S. state of Wyoming.
• “What cemented the deal is Vauld’s global positioning and ambitions and [its] vision have for building customers’ wealth through crypto,” said Andrew McCormack, co-founder of Valar Ventures, alongside billionaire entrepreneur and PayPal founder Peter Thiel.

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Bitcoin (BTC) completed a recovery from Monday’s 10% pullback and is now re-testing the $40,000 resistance level. The cryptocurrency appears overbought, which could trigger some profit taking after a near 25% rally over the past week.

Lower support is seen around $34,000-$36,000, which is the middle of a two-month range.

• The relative strength index (RSI) on the four-hour chart is declining from an extreme overbought reading on Monday. A lower high on the RSI indicates a bearish divergence, which could stall bitcoin’s short-term uptrend.
• Initial support is seen at the 50-period moving average on the four-hour chart, currently at $36,000. Lower support is around $32,000-$34,000, which could stabilize a pullback.
• The intermediate-term trend is improving with a significant loss of downside momentum over the past few weeks. Buyers could remain active at lower support levels, although a breakout above $40,000-$45,000 is needed to resume the long-term uptrend.  

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Livepeer, a decentralized video transcoding platform built on Ethereum, has raised $20 million in a funding round led by Digital Currency Group (DCG).

DCG was joined in the Series B funding round by several other noteworthy investors in the crypto space including Coinbase Ventures, CoinFund and Northzone. (CoinDesk is an independent subsidiary of DCG.)

As the Web 3 ecosystem continues to grow, dapp developers are working on decentralized alternatives to everything from financial products to entertainment, including gaming and music-streaming. 

Related: Uniswap Says It’s Talking With PayPal, Robinhood and More in Deleted Video

But many would-be decentralized streaming platforms and startups encounter trouble building with centralized infrastructure owned by tech giants like Amazon and Google, said Livepeer co-founder Doug Petkanics.

He said the marketplace allows for a symbiotic relationship between buyers and sellers that is incentivized by Livepeer’s native token, LPT, and is much cheaper than the services provided by mainstream alternatives.

Livepeer’s marketplace connects encoding providers – many of whom are crypto miners and data centers with otherwise unused capacity – to anyone who needs processing power for video services. Livepeer has an estimated 70,000 GPUs on its network.

“In creating an open market run by a decentralized network of active participants, Livepeer’s transcoding can be 10 times cheaper (or more) than centralized alternatives like Amazon Web Services,” CoinFund CEO Jake Brukhman said in a press statement.

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At a time when many crypto VCs are raising funds, London-based Fabric Ventures has closed a $130 million war chest for investing in early-stage blockchain firms.

The notable thing, however, is one of its backers: the European Investment Fund (EIF) – which is comprised of the European Investment Bank, the European Union and other financial institutions – chipped in $30 million. 

It’s the first time a vehicle affiliated with the European Commission has invested in a fund focused on digital assets.

Related: Ex-Poker Pros Raise $130M Fund for DeFi Bets

Other notable backers include Ethereum and Polkadot co-founder Gavin Wood as well as 33 other tech executives from firms including PayPal, Square, Google, PayU, Galaxy Digital and Ledger.

It’s heady days for venture capital in fintech, with crypto and blockchain as a subset of that also breaking records with each passing quarter.

Despite the recent euphoria, however, Fabric Ventures co-founder and managing partner Richard Muirhead said his team has been in talks with the EIF since as far back as December 2019.

“Raising venture capital in Europe has lagged behind the U.S.,” Muirhead said in an interview. “Europe has come on leaps and bounds, but needs to do even better with backing new managers and new strategies.” 

Related: The Node: Europe’s Hidden Agenda on Crypto Wallets

EIF Chief Executive Alain Godard said in a statement that the Fabric partnership was “of particular strategic importance for the EU and our competitiveness on the global stage,” adding:

“Despite their rich engineering talent, entrepreneurs in the blockchain sector in Europe often struggle to find financial support and investors that have a deep understanding of their space. This partnership seeks to address that need and unlock financing opportunities for entrepreneurs active in the field of blockchain technologies.”

Fabric Ventures, previously called Firestartr, began taking an interest in blockchain and crypto back in 2013, Muirhead said. As well as investing directly into bitcoin and ether, the firm made early bets on Polkadot, MakerDAO, Tagomi, Bitstamp, Decentraland and 1inch, to name a few.

“Fabric supported an early Ethereum meetup I led in January 2014 and followed my team as we spun out Parity in 2016,” Wood, the Ethereum co-founder, said via email. “So we were very happy to have them as a backer in 2017 when we launched Polkadot. They have supported the Web3 Foundation ecosystem throughout and ongoing.”

Given that Fabric has already made investments in specialized areas of crypto including games like Axie Infinity, what’s next?

“I think there are European-grown refinements to synthetic assets and stablecoins,” said Muirhead. “Another rich area is improved gameplay, combined with great circular economics; so, the ecosystem of yields and lending, and what’s required for play-to-earn around that.”

UPDATE (JULY 29, 10:41 UTC): Fabric updates total amount raised to $130 million.

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Argo Blockchain, the U.K.-listed crypto mining company that’s planning a U.S. share sale this quarter, named CEO Peter Wall as interim chairman and expanded its board of directors.

• Wall replaces Ian Macleod until a new candidate is identified, the company said in a statement.
• The company, based in London, also appointed Finance Director Alex Appleton to the board and named Perry Hothi as chief technology officer.
• Three non-executive directors joined: Colleen Sullivan, the CEO of CMT Digital, Maria Perrella, previously the CFO of Canada-based MDA, and Sarah Gow, a former executive at Citigroup Asset Management.
• Non-executive directors James Savage and Marco D’Attanasio left the company.
• Earlier this month Argo submitted a draft registration statement to the U.S. Securities and Exchange Commission (SEC) for the sale of yet-to-be-determined number American Depositary Shares.

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Decentralized gaming startup Yield Guild Games (YGG) sold all 25 million of its native tokens at break-neck speed.

• The YGG tokens raised $12,496,000 in Circle’s USD-pegged stablecoin, USDC, according to a blog post on Wednesday.
• The sale was conducted via open-source smart contracts platform MISO on the SushiSwap exchange. It began at 14:00 UTC (10:00 am EST) and lasted a total of 31 seconds.
• With the completion of its token sale, the launch of the YGG decentralized autonomous organization is now “officially underway,” the company said.
• YGG touts itself as a “play-to-earn gaming guild,” attracting gamers to its platform in order to earn tokens through blockchain-based economies.
• First up in its order of business will be the distribution of YGG tokens among its community as a means of rewarding early participation, YGG said.
• Up to 45% of the total YGG token supply is reserved for the community and will be “slowly dispersed” over a four-year period.
• As of Wednesday, YGG tokens are available for trading on decentralized exchanges.
• The move comes shortly on the heels of a $1.3 million raise in March which garnered interest from the likes of Delphi Digital and BlockTower Capital, among others.
• The project also raised $4 million in June, led by Bitkraft Ventures with participation from ParaFi Capital and Mechanism Capital.

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The price of Fetch.ai’s native token (FET) has endured a roller-coaster run over the last 24 hours following its listing on the U.S. cryptocurrency exchange Coinbase on Wednesday.

More important than price, however, is that the listing itself is a “groundbreaking moment” for the blockchain machine-learning platform, Fetch CEO Humayun Sheikh told CoinDesk via a spokesperson on Wednesday.

FET is an token that is based on the Ethereum blockchain and that powers applications on Fetch’s platform, which provides users access to artificial intelligence and autonomous agents in manufacturing and supply chains, among other areas.

Related: Coinbase Commerce Adds Support for Dogecoin Payments

Prior to the listing, most of Fetch’s retail investors came from Europe.

The listing “has a very powerful branding effect on the project,” Sheikh said. “With millions of retail investors based in the U.S. looking to invest in cryptos beyond bitcoin and ether, the FET token will gain additional awareness and trading volume due to the listing.”

Prices for FET shot up in the days prior to the announcement, rising 75% from July 17 lows of around $0.19 to a top of $0.42 on Monday, two days prior to Fetch’s big moment, Binance data show.

That is not unusual for a coin being listed on one of the world’s best-known exchanges. Often dubbed the “Coinbase Effect,” the phenomenon is when a cryptocurrency experiences a sharp uptick in price preceding and following its listing.

Related: Coinbase’s Bison Trails Adds Developer Tool for Solana Blockchain

After the listing, though, a crypto’s price tends to cool as speculative traders look to cash in on the hype surrounding the crypto’s new home. On Coinbase, prices for FET are down considerably from a local high of $0.65 on Tuesday. That’s $0.23 more than Binance’s local top.

Asked if the project would liquidate some of the value of its tokens to fund further development of the platform, the CEO said Fetch “keeps all options open” but generally focuses on investors and partnerships.

Sheikh also said that while he isn’t at liberty to discuss the process for a Coinbase listing, it did involve a “lot of due diligence” on security, legal, technical and compliance matters.

The “process can take months and years as they review every aspect of the project before they decide to go ahead,” Sheikh said.

FET was last seen changing hands for around $0.34 on Coinbase with lower- than-average hourly trading volume following price action that had cooled down by Wednesday evening.

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The price of Fetch.ai’s native token (FET) has endured a roller-coaster run over the last 24-hours following a listing on the U.S. cryptocurrency exchange Coinbase on Wednesday.

More important than price, however, the listing itself is a “groundbreaking moment” for the blockchain machine-learning platform, Fetch CEO Humayun Sheikh told CoinDesk via a spokesperson on Wednesday.

FET is an Ethereum-based token powering applications on Fetch’s platform, which provides users access to artificial intelligence and autonomous agents in manufacturing and supply chains, among others.

Related: Coinbase Commerce Adds Support for Dogecoin Payments

Prior to the listing, most of Fetch’s retail investors came from the EU market.

The listing “has a very powerful branding effect on the project,” said Sheikh. “With millions of retail investors based in the U.S. looking to invest in cryptos beyond bitcoin and ether, the FET token will gain additional awareness and trading volume due to the listing.”

Indeed, prices for FET shot up in days prior to the announcement, rising 75% from July 17 lows of around $0.19 to a top of $0.42 on July 26, two days prior to Fetch’s big moment, Binance data show.

That is not unusual for a coin being listed on one of the world’s best-known exchanges. Often dubbed the “Coinbase Effect” where a given crypto usually experiences a sharp uptick in price preceding and following its listing.

Related: Coinbase’s Bison Trails Adds Developer Tool for Solana Blockchain

After the listing though, a crypto’s price tends to cool as speculative traders look to cash in on the hype surrounding its new home. On Coinbase, prices for FET are down considerably from a local high of $0.65, witnessed July 27. That’s $0.23 more than Binance’s local top.

Asked if the project would liquidate some of the value of its tokens to funnel into further development for the platform, the CEO said Fetch “keeps all options open” but generally focuses on investors and partnerships.

Sheikh also said that while he was not at liberty to discuss the process for a Coinbase listing, it did involve a “lot of due diligence” on matters relating to security, legal, technical and compliance.

The “process can take months and years as they review every aspect of the project before they decide to go ahead,” Sheikh said.

FET was last seen changing hands for around $0.34 on Coinbase with lower than average hourly trading volume following price action having cooled by Wednesday evening.

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Bank of America (BofA) called central bank digital currencies “a much more effective payment system than cash,” in a research paper published Wednesday.

The Charlotte, N.C.-based bank, the second largest in the U.S. by total assets, said that CBDCs could “replace cash completely in the (distant) future.”

The report comes amid surging interest among central banks. A May report by the blockchain infrastructure platform Bison Trails found that about 80% of central banks are exploring use cases involving CBDCs, with 40% already testing proof-of-concept programs.

Related: Bank of Estonia Finds ‘Unlimited’ Potential in Digital Euro Test

Bank of America said that CBDC adoption was “inevitable,” citing a declining role for cash, the private sector’s increasing use of blockchain technology, loss of control over currency and CBDCs’ potential to boost the economy. It also noted that central banks that did not launch their own digital currencies could see decreasing demand for their currencies, “substantially in some cases,” and a smaller “global role.”

Addressing concerns that a CBDC could compete with bank deposits, spur bank runs and compromise individual security, the paper highlighted central banks’ “very cautious approach.”

The paper said that CBDCs qualified as money “by allowing store of value and being a unit of account and means of exchange,” differentiating them from cryptocurrencies that “do not meet these criteria. “Since they are traded, they could be seen as an asset class,” the paper said.

Bank of America said that CBDCs could lessen the need for stablecoins, noting that the latter could “present a material financial stability risk during times of market stress when there may be a crypto to fiat currency run.”

Related: India’s Central Bank Considering Pilot Programs for CBDC: Report

In recent months, Bank of America has ratcheted up its own commitment to provide more cryptocurrency services and explore crypto’s potential.

The bank has created a team dedicated to researching cryptocurrencies and related technologies, according to a memo reviewed by CoinDesk earlier this month. Separately, it has also approved the trading of bitcoin (BTC, +0.63%) futures for some clients, and its prime brokerage unit has started the clearing and settlement of cryptocurrency exchange-traded products (ETPs) for hedge funds in Europe.

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Cryptocurrencies should be written into a major Japan-U.S. trade agreement inked in 2019, according to experts from a prominent think tank.

In a blog post on Wednesday, senior policy analyst Sale Lilly and senior political scientist Scott Harold of the RAND Corporation said the deal was a missed opportunity for the crypto industry.

“Given that some of the earliest cryptocurrency markets began in Japan, and that many of the largest companies originate in the U.S., this decision was somewhat surprising,” the pair wrote.

Related: Monex Nets $100M First-Quarter Profit Driven by Crypto Trading

The 2019 agreement was a “landmark” document touching on a number of topics that had yet to make an appearance in previous international trade discussions.

Digital representations of a photo, movie, or song as well as trading an algorithm now formulate components of bilateral trade covered by the agreement which prevents the creation of new tariffs between the two countries.

With the beginnings of new political regimes in Washington and Tokyo, it may be time to reconsider the exclusion of crypto in the deal, Lilly and Harold wrote.

The deal, which was inked during Donald Trump’s presidency and ahead of other major international digital trade agreements, is “especially prescient” given it came right before the outbreak of COVID-19, the pair said.

Related: Ripple On-Demand Liquidity Corridor Opens Between Japan and Philippines

Though, as it stands, there is no mention of cryptos and only some aspects of blockchain may land within the remit of the tariff-free structure.

“The reality … is that blockchain systems are often deployed alongside better-established networks, like Ethereum or Cardano, that do employ tokens and digital currency,” they said.

Concerns arise from the potential to retroactively tack tariffs onto budding blockchain and crypto businesses as long as cryptos remain excluded from the agreement.

To rectify this, Lilly and Harold said the U.S. and Japan could formulate a new agreement covering crypto and digital assets or else reinterpret the terms of the 2019 agreement.

RAND’s approach and analysis of cryptos have changed significantly in recent years given their development amid significant regulatory evolutions in the space. In 2015, the think tank released a 100-page report focusing on scenarios in which entities in conflict zones could seek to use a digital currency for nefarious means.

“A clear, jointly-negotiated U.S.-Japan agreement toward regulating the use of cryptocurrencies in international trade may be an idea whose time has come,” Lilly and Harold wrote.

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Stock and crypto-trading app Robinhood has secured a $32 billion valuation via its initial public offering (IPO) and is set to debut on the Nasdaq exchange on Thursday.

• According to a press release on Wednesday, Robinhood has priced its offering at $38 per Class A common stock share.
• The pricing is at the lower end of the $38-$42 per share price range the company had targeted and had planned on selling 5.5 million shares targeting a $1.89 billion raise.
• Net proceeds from the sale will go toward working capital, capital expenditures, funding tax obligations, hiring efforts, customer support services, among others.
• Shares will be listed on the Nasdaq Global Select Market while Goldman Sachs and JPMorgan are acting as joint lead book-running managers, according to the release.
• Earlier this month, Robinhood began unconventionally offering a portion of its IPO to users via its app — a view some consider to be a risky gamble.
• Known for its zero-fee trading structure, the company has continued to endure hits to its image as well as legal and political ramifications stemming from the fallout of the GameStop saga and limitations to users trading crypto.
• The company is trying to reshape that image and is reportedly working on a new feature that will help protect users from crypto price volatility while hiring a former Google alumn to improve its overall product design.
• Still, the company’s CEO Vlad Tenev is staring down allegations from the Financial Industry Regulatory Authority over his failure to register Robinhood Financial relating to compliance issues.

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Crypto lender BlockFi has been given at least another month before a block on the creation of all new BlockFi Interest Accounts (BIAs) ordered by the New Jersey Bureau of Securities (NJ BOS) takes effect.  

BlockFi tweeted on Wednesday that the postponement followed ongoing talks between BlockFi and NJ BOS “to provide more details about the BIA.”  

NJ BOS’s order was originally set to go into effect on July 22, and then was delayed until July 29. 

Related: Blockchain Australia Recommends Safe Harbor Provision for Crypto Providers

BlockFi is facing similar scrutiny of its interest-bearing crypto accounts from Texas and Alabama. In its tweet, BlockFi said it is in “active dialogue with multiple regulators” regarding its BIAs.

NJ BOS has argued that the BlockFi Interest Accounts amount to unregistered securities, while BlockFi has said that they are not.

“We firmly believe that the BIA is lawful and appropriate for crypto market participants, and we remain steadfast in our commitment to fight for consumers rights to earn interest on their crypto assets,” BlockFi wrote in its tweet on Wednesday.

BlockFi had no additional comment on the matter, while the NJ BOS could not be immediately reached.

Related: Vermont Joins Ranks of States Probing Crypto Lender BlockFi

BlockFi has maintained that the New Jersey order does not affect existing BlockFi customers, nor any of its other products, a claim the NJ BOS order appears to support. 

Less clear, though, is the extent to which this could impact new BlockFi customers, and whether the order’s impact could spread beyond New Jersey.

NJ BOS has said BlockFi holds $14.7 billion in assets through its BIA product, although how much of that is held by New Jersey consumers is unclear. 

The New Jersey-based company has indicated it plans to go public within the next 12 to 18 months.

Danny Nelson contributed reporting.

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A bipartisan infrastructure bill in Congress proposes to raise $28 billion from crypto investors by applying new information reporting requirements to exchanges and other parties.

According to a draft copy of the bill shared with CoinDesk, any broker that transfers any digital assets would need to file a return under a modified information reporting regime. The draft defined digital assets as “any digital representation of value … recorded on a cryptographically secured distributed ledger” or related technology. It also includes decentralized exchanges and peer-to-peer marketplaces in its definition of brokers.

A separate summary of the bill further clarified that cryptocurrencies are treated as a subsection of the broader digital asset umbrella.

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“The provision includes updating the definition of broker to reflect the realities of how digital assets are acquired and traded,” the document said. “The provision further makes clear that broker-to-broker reporting applies to all transfers of covered securities within the meaning of section 6045(g)(3), including digital assets.”

This could bring up to $30 billion into the bill’s “pay-fors,” according to a fact sheet also shared with CoinDesk. 

“Additionally, digital assets are added to the current rules requiring businesses to report cash payments over $10,000,” the fact sheet said.

The crypto reporting requirements are among a list of 14 new “pay-fors” included in the bill, which also includes repurposing COVID-19 relief funds, auctions, Superfund fees, fuel sales and other sources of revenue.

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Kristin Smith, executive director of the Blockchain Association, told CoinDesk the draft language could mean a number of individuals interacting with crypto may have to start reporting their transactions.

“We interpret this to mean software wallet developers, hardware wallet manufacturers, multisig service providers, liquidity providers, DAO token holders and potentially even miners,” she said. 

The $1 trillion infrastructure bill also includes provisions for funding public transit, particularly passenger rail; investments in bridges, clean drinking water and wastewater infrastructure; and high-speed internet access for all Americans, among other provisions, according to a White House fact sheet. 

The U.S. Senate may conduct a test vote as early as Wednesday, Senate Majority Leader Chuck Schumer (D-N.Y.) said.

In a statement, U.S. President Joe Biden praised the team that negotiated the bill, saying neither side got 100% of what it wanted.

“Everyone from unions to business leaders and economists left, right and center believe the public investments in this deal will mean more jobs, higher productivity, and higher growth for our economy over the long term. Experts believe that the majority of the deal’s benefits will flow to working families,” he said in a statement.

A previous Biden budget proposal also includes new crypto reporting requirements.

UPDATE (July 28, 2021, 22:05 UTC): Updated with additional information.

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