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Secretario de Hacienda de México confirma prohibición de uso de criptomonedas en el país

5 years 3 months ago

Un alto funcionario del gobierno de México reiteró el lunes la prohibición del uso de criptomonedas en el sistema financiero de ese país. 

Arturo Herrera Gutiérrez, Secretario de Hacienda y Crédito Público de México, dijo que las criptomonedas no son activos de curso legal y no son concebidas como divisas dentro del marco regulatorio actual del país. 

No se espera que esas prohibiciones se levanten en el corto plazo, dijo Herrera durante una presentación ante el Grupo de Acción Financiera (GAFI). 

Related: Mexico’s Finance Minister Confirms Cryptos Are Banned From Financial System

Read this article in English.

El anuncio se produce después de que el domingo el empresario Ricardo Salinas Pliego, promotor de bitcoin (BTC, +4,93%) y la 166ª persona más rica del mundo, declarara que estaba trabajando para que su banco, Banco Azteca, fuera el primero en México en aceptar la mayor criptomoneda. 

Los comentarios de Herrera no estaban explícitamente ligados a la promesa de Salinas, pero se produjeron pocas horas después del anuncio del empresario.

En un comunicado conjunto, el Banco Central de México, la Secretaría de Hacienda y la Comisión Nacional Bancaria y de Valores precisaron que las criptomonedas no son activos de curso legal ni divisas en el marco legal vigente. Además, advirtieron sobre los riesgos del uso de estos activos. 

Related: El multimillonario Ricardo Salinas dice estar trabajando para que su banco sea el primero en México en aceptar bitcoin

El documento consta de cuatro páginas y fue calificado por Herrera como “inusualmente extenso”.

Las tres entidades reiteraron las advertencias que hicieron en 2014, 2017 y 2019 sobre los riesgos para utilizar criptodivisas como forma de intercambio, reserva de valor u otra forma de inversión. 

Además, el documento señaló que las instituciones financieras en México no están autorizadas para realizar y ofrecer al público operaciones con activos virtuales como bitcoin, ether (ETH, +15.99%), XRP (+6.66%) y otros, “con el fin de mantener una sana distancia entre éstos y el sistema financiero”. 

Las instituciones financieras que realicen u ofrezcan operaciones con activos virtuales sin una autorización estarán en violación de las regulaciones y sujetas a las sanciones aplicables, agregó el informe. 

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Lawyers for Africrypt’s Missing Founders Say They’ve Been Fired: Report

5 years 3 months ago

Lawyers for the missing co-founders of South African crypto investment platform Africrypt say their relationship with the brothers has been terminated, according to a report from Bloomberg.

Twenty-year-old Ameer Cajee and 17-year-old Raees Cajee, who are brothers, are thought to have vanished in April, after sending an email to investors telling them the platform had been “hacked” and shuttering Africrypt’s website. Bitcoin worth an estimated $3.6 billion is allegedly missing.

Johannesburg-based attorney John Oosthuizen, told Bloomberg via email that his firm’s “mandate to assist the Cajee Brothers has been terminated” when asked to comment on the brothers’ whereabouts. Oosthuizen’s statement comes only two days after he first spoke with the BBC about the scandal.

Related: Founders of South African Crypto Investment Firm – and $3.6B in Bitcoin – Are Missing

The launch of a formal investigation is constrained by South African law, which does not consider cryptocurrencies a financial product. But if the Cajee brothers absconded with the $3.6 billion in bitcoins, the theft would rank among the largest in crypto history.

Oosthuizen previously told the BBC that the brothers “categorically denied” the accused heist, saying that it was a hack and the money was missing.

According to Oosthuizen, the reason the brothers didn’t immediately contact the police was not that they were making their getaway, but rather that they were young men with “very little life experience” who were afraid for their lives after receiving death threats from involved parties.

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Cathie Wood’s ARK Invest, 21Shares Team Up to Enter Bitcoin ETF Race

5 years 3 months ago

Cathie Wood’s ARK Investment Management has joined the race to get a bitcoin exchange-traded fund (ETF) approved by the U.S. Securities and Exchange Commission.

  • According to SEC filings, the noted tech investor is partnering with investment product firm 21Shares in submitting a bitcoin ETF application.
  • The “ARK 21Shares Bitcoin ETF” would tap 21Shares’ expertise in spinning up crypto exchange-traded products (ETPs), mostly in Europe.
  • ARK and 21Shares join the swelling ranks of companies hoping this will be the year the SEC approves a bitcoin ETF.
  • The SEC has swatted down dozens of bitcoin ETF proposals in recent years.
  • Wood joined the board of Amun Holdings, the parent company of 21Shares, in May.

UPDATED (June 29, 09:44 UTC): Adds 21Shares to headline.

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Cathie Wood’s ARK Invest Enters Bitcoin ETF Race

5 years 3 months ago

Cathie Wood’s ARK Investment Management has joined the race to get a bitcoin exchange-traded fund (ETF) approved by the U.S. Securities and Exchange Commission.

  • According to SEC filings, the noted tech investor is applying to create the ARK 21Shares Bitcoin ETF.
  • The vehicle would tap 21Shares’ expertise in spinning up crypto ETFs, mostly in Europe.
  • ARK joins the swelling ranks of companies hoping this will be the year the SEC approves a bitcoin ETF.
  • The SEC has swatted down dozens of bitcoin ETF proposals in recent years.
  • Wood joined the board of Amun Holdings, the parent company of 21Shares, in May.
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Market Wrap: Cryptocurrencies Rise Despite Binance UK Warning

5 years 3 months ago

Cryptocurrencies were mostly higher Monday despite regulatory crackdowns in the U.K. and China. Bitcoin was trading at around $34,000 at press time and is up 4% over the past 24 hours. 

On Saturday, the Financial Conduct Authority, the U.K’s financial regulator, warned that Binance Markets Ltd., an affiliate of Binance, is not allowed to undertake any regulated activities without prior written approval. The announcement preceded a nearly 13% drop in bitcoin over the weekend, although buyers were quick to defend support at the $30,000 level.

Bitcoin is down about 40% since April, on track for the largest two-month price drop since November 2018.

Latest prices

Related: Ethereum Gas Fees at 6-Month Low as Market Cools, Layer 2 Solutions Ease Congestion

Cryptocurrencies:

  • Bitcoin (BTC) $34409.44 +4.64%
  • Ether (ETH) $2110.96, +15.66%

Traditional markets:

  • S&P 500: 4291.8, +0.26%
  • Gold: $1778.36, +0.38%
  • 10-year Treasury yield closed at 1.472%, compared with 1.53% on Friday

“To be clear, Binance has not been banned from the U.K,” wrote Mati Greenspan, CEO of Quantum Economics, in a newsletter published on Monday. “This in no way indicates a policy shift from the U.K. regulators regarding crypto assets.”

Other analysts point to improving technicals as bullish. 

Related: Mexico’s Finance Minister Confirms Cryptos Are Banned From Financial System

Last week’s close on the weekly price chart provided a “bullish signal indicating possible trend reversal,” wrote Alexandra Clark, a trader at U.K. digital asset broker GlobalBlock.

Bear market drawdown

Bitcoin’s “drawdown,” or the percentage decline from peak to trough, is currently around 45%, according to data provided by Koyfin. The previous bear market in 2018 reached a drawdown of 80% and took about two years to fully recover. 

Typically, bitcoin suffers sharp but quick drawdowns prior to a bear market similar to 2017 and earlier this year. Eventually, sellers gain control as price shifts from an uptrend to a downtrend. 

For now, some analysts expect bitcoin to remain in a range of between $30,000 and $40,000. “We expect BTC consolidation to continue for next few weeks until a decisive move takes place,” Pankaj Balani, CEO of Delta Exchange, wrote in an email to CoinDesk.

“If the global macro environment deteriorates on account of decreasing pace of global liquidity, it’s expected BTC may break the crucial level of $30K and challenge the highs of the previous cycle at $20K,” Balani wrote. “Until then, BTC is likely to be in this range and can set up a classic bull trap above $42K.” 

Bitcoin miner revenue drop

Miner revenue has collapsed during the crypto sell-off and amid regulatory pressure from China. “The mining market has experienced an approximately 65.5% decline in revenues since levels sustained in March and April,” Glassnode wrote in a newsletter published on Monday.

“The 7-day average mining revenue currently sits at around $20.73M/day, which in context, is still 154% higher than it was at the time of the back-to-back halvings in 2020” the data firm wrote.

Mining difficulty adjustment

China’s crackdown on cryptocurrencies has been a blow for bitcoin mining companies and pools based in the country, with some hit harder than others. But for active miners in other parts of the world, it might be good news.  

Bitcoin’s mean hash rate – a measure of the computational power working to secure the blockchain network – fell to 94 EH/s on Sunday, the lowest since May 2020, according to Glassnode. Meanwhile, the bitcoin mining difficulty could see a 25% drop at the next reset, likely on July 3, based on Glassnode’s estimates. 

A downward adjustment of that size could be the largest in the Bitcoin network’s 12-year history, according to Compass Mining.

With the hash power declining and most Chinese miners going offline, the business should become easier and potentially more profitable for miners that are still active, according to Sam Doctor, chief strategy officer at BitOoda, a digital asset financial services platform.

Ethereum funds see record outflows

Net outflows from cryptocurrency funds totaled $44 million for the week ended on Friday, marking the fourth consecutive week of redemptions.

Ethereum products saw net outflows of $50 million last week, the largest on record since 2015, according to a report by CoinShares published Monday. The movement marks a reversal from the trend so far in 2021, with Ethereum-focused products having garnered a net of $943 million for the year to date as investors diversified away from bitcoin.

Altcoin roundup
  • QUARLES ON STABLECOINS: Federal Reserve Vice Chairman Randal Quarles said at a bankers conference in Utah on Monday that the U.S. should find ways to say “yes” to stablecoins. The speech stood in contrast to recent comments from Fed officials, such as Federal Reserve Governor Lael Brainard, that have warned that stablecoins could pose a risk to consumers and businesses. 
  • SAFEDOLLAR HIT: SafeDollar, a decentralized finance (DeFi) stablecoin based on the Polygon blockchain, has been hit by a cyberattack. All activities on SafeDollar have been paused and investigations are underway, while the value of SafeDollar has dropped to $0.
  • MUSK ON DOGE FEES: Elon Musk tweeted support for a proposal to reduce dogecoin’s transaction fees. DOGE’s price saw an uptick to $0.262, before it fell back to $0.255 as of press time. 
Relevant news Other Markets

Most digital assets on the CoinDesk 20 ended up higher on Monday.

Notable winners as of 21:00 UTC (4:00 p.m. ET): 

aave (AAVE), +21.48%

chainlink (LINK)  +13.47%

yearn Finance (YFI), +13.46%

Notable losers: 
USD coin (USDC) – 0.02%

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Mexico’s Finance Minister Confirms Cryptos Are Banned From Financial System

5 years 3 months ago

A top Mexican official reiterated on Monday a ban on the use of cryptocurrencies in the country’s financial system.

Arturo Herrera, Mexico’s finance minister, said cryptocurrencies aren’t legal tender assets and aren’t treated as currencies within the country’s current regulatory framework. 

Those bans are not expected to be lifted in the short term, Herrera said during a presentation to the Financial Action Task Force, a global anti-money laundering group.

Related: Secretario de Hacienda de México confirma prohibición de uso de criptomonedas en el país

Lee este artículo en español.

The announcement comes after a Sunday pronouncement by billionaire Ricardo Salinas Pliego, a noted bitcoin bull, that he was working to make Banco Azteca the first bank in Mexico to accept the cryptocurrency. Salinas is chairman of Grupo Salinas, the bank’s parent company.

Herrera’s comments weren’t explicitly tied to Salinas’ pledge, but came within hours of the businessman’s announcement.

Herrera said his secretariat will publish a four-page communiqué detailing the government’s position.

Related: Market Wrap: Cryptocurrencies Rise Despite Binance UK Warning

In a joint statement, the Central Bank of Mexico, the finance secretary and the National Banking and Securities Commission specified that cryptocurrencies are neither legal tender assets nor currencies under the current legal framework. In addition, they warned about the risks of using cryptocurrencies. 

The document consists of four pages and was characterized by Herrera as “unusually extensive.”

The three entities reiterated the warnings they issued in 2014, 2017 and 2019 about crypto’s risks as a form of exchange, store of value or other form of investment. 

In addition, the document said that financial institutions in Mexico are not authorized to deal with virtual assets such as bitcoin, ether, XRP and others, “in order to maintain a healthy distance between these and the financial system.”

Financial institutions that conduct or offer operations with virtual assets without an authorization will be in violation of the regulations and subject to applicable sanctions, the report added.

Mexico is the headquarters of Bitso, the largest cryptocurrency exchange in Latin America. In May, the company raised $250 million in its Series C funding round and reached a $2.2 billion valuation.

The statement on Monday affirms that the government has not authorized the collection of deposits from the general public “through technological schemes related to blockchain or distributed registries, known as stablecoins.”

In May, Bitso CEO Sergio Vogel said on CoinDesk TV’s “First Mover” program the exchange, which has 2 million users, has seen a sharp increase in demand for dollar-linked stablecoins.

Bitso didn’t immediately respond to CoinDesk’s requests for comment.

 

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Bitcoin Mining Hashrate Drops to 1-Year Low; Difficulty Set for 25% Decrease

5 years 3 months ago

China’s crackdown on cryptocurrencies has been a blow for bitcoin mining companies and pools based in the country, with some hit harder than others. However, for active miners in other parts of the world, it might be good news.  

Bitcoin’s mean hashrate – a measure of the computational power working to secure the blockchain network – fell to 94 EH/s on Sunday, the lowest since May 2020, according to data from Glassnode. Meanwhile, the bitcoin mining difficulty could see a 25% drop at the next reset, likely on July 3, based on Glassnode’s estimates. 

A downward adjustment of that size could be the largest in the Bitcoin network’s 12-year history, according to Compass Mining.

Related: El Salvador Wants to Attract Bitcoin Talent. Its Strategy Is Working

With the hash power declining and most Chinese miners going offline, the business should become easier and potentially more profitable for miners that are still active, according to Sam Doctor, chief strategy officer at BitOoda, a digital asset financial services platform. 

Read more: Iran’s Ministry of Industry Issues 30 Licenses to Crypto Mining Farms

As hashrate declined, the number of daily bitcoin earned for each unit of computational power likely increased, which “certainly would imply more bitcoin” for active miners, according to Doctor. The dollar-equivalent value of the proceeds is harder to predict given the cryptocurrency’s notorious price volatility.

Concerns about the extent of the China crackdown have contributed to the past months’ decline in bitcoin’s price to about $34,200 now, from an all-time high near $65,000 in early April.

Miner migration

Related: Hut 8 Adds Over 500 Bitcoin to Balance Sheet in 3 Months

The fall in the bitcoin mining hash power is likely to continue, according to BitOoda, which predicts the target hashrate could drop further to 85 EH/s at the subsequent difficulty reset on July 19 or July 20. 

“We believe it would take several quarters for the infrastructure deployment to be complete,” according to BitOoda. “As a result, hashrate will likely be below our prior forecasts for the next ~10 quarters.”  

When will the fall come to an end? It may depend on how the crypto mining industry responds to China’s crackdown. 

With Chinese miners looking for new places to host mining rigs, North America has attracted enormous interest due to its comparatively lower geopolitical risks, large-scale utility networks and emphasis on environmental, social, and corporate governance, according to Dave Perrill, CEO of Computer North, a cryptocurrency mining colocation company. 

“We’re seeing a ton of inbound requests from Chinese-based mining companies that are looking to relocate to North America and are looking to do it urgently,” said Perrill. “We’re receiving over a hundred megawatts of requests per day.”  

Read more: Chinese Bitcoin Mining Company Delivers First Machines to Kazakhstan

“I think in the course of the next 12 to 18 months, over 50% of the hashrate will be in North America,” according to Perrill. 

However, the migration takes time, and infrastructure could be a bottleneck.

“We’ll see a lot of machines hitting the North American shores and some are just going to be offline for a while until the hosting infrastructure can catch up,” Perrill said.

According to BitOoda’s Doctor, “the concern is that not every miner in China could find a hosting site outside of China.”

Many hosting sites face a shortage of substations and transformers to pair with bitcoin mining rigs coming from China, Doctor noted. 

“There aren’t that many sites that are ready for development,” Doctor said.

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Compound Labs Launches ‘Treasury’ to Get Big Firms Reaping DeFi Yields

5 years 3 months ago

Decentralized finance (DeFi) firm Compound Labs, the creator of the Compound money market on Ethereum, has a new company: Compound Treasury.

It could be one of the most significant developments in “institutional DeFi” to date. While asset managers like Bitwise have packaged DeFi tokens for big investors, few have offered gateways to DeFi’s underlying protocols.

In cooperation with Fireblocks and Circle, Compound Treasury lets neobanks and fintech firms send dollars that are converted into USDC, the dollar-backed stablecoin Circle administers in partnership with Coinbase.

Related: DeFi Money Market Compound Embraces Multi-Chain Future With ‘Gateway’ Testnet

Those USDC tokens will then be deployed on Compound for a guaranteed interest rate of 4%, vastly better than anything firms would get from a savings account or even a certificate of deposit. 

“This is our path to sustainability as a company. … If the interest rates in Compound earn more than 4% over time, the business will make money,” Compound founder Robert Leshner told CoinDesk. “It’s the ability to offer a new financial product that fintechs have been clamoring for.”

According to a blog post shared in advance with CoinDesk, Compound Treasury enables “large holders of U.S. Dollars to access the interest rates available in the USDC market of the Compound protocol, while abstracting away protocol-related complexity including private key management, crypto-to-fiat conversion, and interest rate volatility.”

The math

If it’s hard to understand where a 4% return could come from (current returns on USDC deposits on Compound are 1.67%), it’s important to note that all Compound users are still earning COMP governance tokens (which trade at around $298 as of this writing), and will do so at a consistent rate for about three more years. 

Related: DeFi Lending Platforms Liquidate Record $115M in Loans as ETH Price Drops

So it’s not just whatever yield USDC deposits earn, but also the liquidity mining returns; and if Compound the protocol becomes more important in its multichain future, the COMP earned will become more valuable, allowing Compound Treasury to earn a stronger profit. 

That said, Compound Treasury won’t take wild bets to goose returns further, chasing whichever liquidity pool has the most lucrative profits. “It’s going to be only stablecoins. Because customers should never be exposed to the risk of cryptocurrencies,” Leshner said.

Compound Treasury will also work more like a normal savings account. Users can get in and out when they want. No commitments to lock up for a certain period.

Other related products have come along recently. Circle just announced Circle Yield, a DeFi API that is used in the Compound Treasury product. Circle’s product offers various returns depending on how long the depositor commits to leave it in. Anchor, from Terraform Labs, is offering 20% returns, but users will need to touch cryptocurrency to access it.

It’s useful here to remind readers that while Compound Labs made the Compound protocol, it doesn’t own it. It may have a large portion of its governance tokens, but many others do as well. So far, no portion of revenues on Compound goes to COMP holders.

From the start, it was always the plan to build the protocol and then build a business atop the protocol that would have a revenue stream, which brings us to Compound Treasury.

“This is what Compound Labs is offering, a dollar on-ramp to the protocol,” Leshner said. “I think this could be shockingly big and shockingly profitable.”

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El multimillonario Ricardo Salinas dice estar trabajando para que su banco sea el primero en México en aceptar bitcoin

5 years 3 months ago

Ricardo Salinas Pliego, destacado promotor de bitcoin y la persona número 166 en el ranking de los más ricos del mundo, dijo que está trabajando para que su banco sea el primero en México en aceptar bitcoin. 

En un tuit en el que respondía a su colega entusiasta de bitcoin y CEO de MicroStrategy, Michael Saylor, el multimillonario mexicano escribió en inglés: “Yo y mi banco (Banco Azteca) estamos trabajando para ser el primer banco en México en aceptar #Bitcoin”. 

Read this article in English.

Related: Billionaire Salinas Says He’s Working for His Bank to Be First in Mexico to Take Bitcoin

Saylor comentaba un vídeo en el que aparecía Salinas y que fue compartido en Twitter por el conocido inversor y defensor de bitcoin Anthony Pompliano.

En el video, Salinas explicó cómo su experiencia con la hiperinflación influyó en su razonamiento para invertir en bitcoin y por qué piensa que “el fiat es un fraude”. También explica por qué preferiría la criptomoneda antes que cualquier otro activo.

Salinas es el fundador y presidente del Grupo Salinas, un conjunto de empresas con participaciones en telecomunicaciones, medios de comunicación, servicios financieros y tiendas minoristas, según Wikipedia. De acuerdo a Forbes, su patrimonio neto es de $15.800 millones

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Fed Vice Chair: ‘We Should Be Saying Yes’ to Stablecoins

5 years 3 months ago

Federal Reserve Vice Chair Randal Quarles said at a bankers conference in Utah on Monday the U.S. should find ways to say “yes” to stablecoins.

The speech was in sharp contrast to recent comments from other Fed officials, such as Federal Reserve Governor Lael Brainard, who have warned stablecoins could pose a risk to consumers and businesses. Speaking at the 21 Utah Bankers Association Annual Convention, Quarles added that the U.S. central bank has a “strong regulatory interest” in stablecoins but also said there is no need to fear them. 

“When our concerns have been addressed, we should be saying yes to these products, rather than straining to find ways to say no,” Quarles said. “Indeed, the combination of imminent improvements in the existing payments system such as various instant payments initiatives combined with the cross-border efficiency of properly structured stablecoins could well make superfluous any effort to develop” a central bank digital currency.

Related: Opera Browser Adds First Stablecoins to Native Wallet – cUSD, cEUR

Among the concerns Quarles highlighted was the possibility stablecoins that were fractional rather than fully reserved could create a “run risk” for consumers. Last week, Eric Rosengren, president of the Federal Reserve Bank of Boston, listed tether among the “financial stability challenges” the Fed is watching.

Quarles also downplayed bitcoin and foreign CBDCs as potential threats to the U.S. dollar.

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Huobi Reveals Countries Where It Has Halted Derivatives Trading

5 years 3 months ago

Crypto exchange Huobi is prohibiting customers in 10 countries or regions from trading derivatives, including mainland China and retail investors in the U.K., according to an updated User Agreement. 

The list came more than a month after the exchange said it would ban futures contracts and some leveraged investment products in “a few specified countries and regions,” as CoinDesk first reported. 

The exchange has already barred people in another 11 countries from crypto transactions and provision of related services, according to the new agreement. These countries or regions include the U.S., Canada, Japan, Iran, North Korea and Crimea. 

Related: Is China Opting Out of Crypto? Feat. Dovey Wan

The full list includes the following:

Anyone from mainland China, Taiwan, Israel, Iraq, Bangladesh, Bolivia, Ecuador, Kyrgyzstan, Sevastopol and the U.K. (in the U.K., retail investors only) is prohibited from using the derivatives trading services provided by Huobi’s website. 

Use of the transaction of digital assets and provision of related services by persons located in the U.S., Canada, Hong Kong, Japan, Cuba, Iran, North Korea, Sudan, Syria, Venezuela and Crimea is prohibited.  

The company declined to comment on the user agreement. 

Related: China’s Longest-Running Crypto Exchange Closes Bitcoin Business Following Crackdowns

Huobi is the latest exchange to scale back trading services amid an intensifying crackdown on crypto trading on exchanges or over-the-counter (OTC) desks in China. 

The Chinese government’s notices cited money laundering and excessive speculation in the crypto market as two of the reasons for this wave of crackdowns. 

The People’s Bank of China, the country’s central bank, summoned major commercial banks to reiterate a longstanding ban on dealings with crypto trading platforms on June 21, and singled out OTC trading as one of the services that most needed to be supervised and regulated. 

The first official warning this year against crypto trading from China was issued by three financial industry associations on May 18. Another notice by the State Council of China, which is one of the highest central government agencies, escalated the crackdown and triggered Huobi to reduce its trading and mining services. 

More telecom fraudsters are turning to crypto to launder their proceeds, according to the Chinese police, while leveraged trading is one of the most risky investments in digital assets. Small price drops could prompt large-scale liquidations, which lead to further decreases in price, Jason Wu, CEO of crypto lending platform DeFiner, said in a previous interview. 

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Hut 8 Adds Over 500 Bitcoin to Balance Sheet in 3 Months

5 years 3 months ago

Canadian crypto mining company Hut 8 said it holds “approximately 3,806” bitcoin on its balance sheet, compared with 3,271 at the end of March.

  • In a corporate update published Monday, the Toronto-based firm said it expects the figure to grow to around 5,000 by the end of the year.
  • “We now have 1.2 Exahash in production and ongoing installation of new equipment puts us on a near-term trajectory to produce an additional [two to three] bitcoin per day by the end of August, on top of our current production rate of 6.2-7.3 bitcoin per day,” CEO Jaime Leverton said.
  • In its first-quarter results, Hut 8 reported holding 3,271 as of March 31. Monday’s report represents an increase of 535 BTC in less than three months.
  • Miners accumulating coins can be seen a bullish sign for the market as it points to them holding coins in anticipation of a price rally.
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Ethereum Investment Funds Saw Record Outflows of $50M

5 years 3 months ago

Investors are exiting digital asset investment products, including funds focused on bitcoin and ethereum, as a wave of negative sentiment weighs on cryptocurrencies.

Net outflows from cryptocurrency funds totaled $44 million for the week ending June 25, marking the fourth consecutive week of redemptions.

Ethereum products suffered net outflows of $50 million last week, the largest on record since 2015, according to a report by CoinShares published Monday. The movement marks a reversal from the trend so far in 2021, with Ethereum-focused products having garnered a net of $943 million for the year to date as investors diversified away from bitcoin.

  • “Since mid-May, as negative sentiment has remained prevalent, net weekly outflows now total $313 million,” representing 0.8% of total assets under management (AUM), according to CoinShares.
  • On a relative basis, the total outflows of digital asset funds last week “remains small in comparison to the negative sentiment in early 2018, where outflows as a percentage of AUM totaled 4.9%.”
  • Multi-asset digital investment products saw inflows of $6 million last week, suggesting that investors are seeking diversification across cryptocurrencies, beyond bitcoin and ethereum.
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Coinbase Receives Crypto Custody License From German Regulator BaFin

5 years 3 months ago

Coinbase has received a crypto custody license from Germany’s Financial Supervisory Authority (BaFin), allowing Coinbase to continue serving the German market. BaFin announced the news Monday.

Coinbase is the first company to receive the license, BaFin said in a press release.

In November 2019, Germany’s parliament – the Bundestag – passed a law that required firms custodying crypto for Germans to apply for a crypto custody license or leave Germany. Companies that were already operating in the country on Jan. 1, 2020, were required to announce their intent to apply by March 31 of that year and apply by Nov. 30. 

Related: A Reckoning for Binance and Other ‘Global’ Exchanges

The approval comes at a time in which Coinbase is trying to prove itself to be an exchange that embraces regulation after having gone public in the U.S. via a direct listing in April.

At the same time, Coinbase rival Binance has been warned by regulators to stop operating in the U.K. and Japan, and has pulled out of Canada’s Ontario province to avoid scrutiny from the Ontario Securities Commission (OSC).

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Singapore’s Central Bank, IMF Launch Global Challenge for CBDC Solutions

5 years 3 months ago

The Monetary Authority of Singapore (MAS) has teamed up with the International Monetary Fund (IMF), World Bank and others to launch a competition where entrants must tackle 12 unresolved challenges posed by central bank digital currencies (CBDCs). 

  • “Can a retail CBDC system be embedded with additional functionalities beyond a basic transfer of value without requiring users to use smartphones?” the first challenge asks.
  • The competition will be supported by Amazon Web Services, Mastercard, payments platform Partior, blockchain software developer R3 and blockchain project Hyperledger.
  • MAS said Monday the effort is also backed by the Asian Development Bank, United Nations Capital Development Fund and the Organization for Economic Co-operation and Development (OECD).
  • It is estimated 80% of central banks are actively exploring use cases around CBDCs and many are being confronted with challenges around policy, privacy and technology.
  • Finalists will have the chance to pitch their ideas during a demo day to be held at this year’s Singapore FinTech Festival in November. 
  • MAS says up to three winners will be chosen, with each receiving S$50,000 (US$37,193) in prize money; up to 15 finalists will go on to receive mentorship and access to the APIX Digital Currency Sandbox.
  • Those looking to participate can apply here.
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NFT-Powered Digital Comic Book to Let Fans Decide Heroes’ Fates

5 years 3 months ago

In 1988, when fans turned against the second character to wear the costume of Batman’s sidekick, Robin, a character named Jason Todd, D.C. Comics set up a telephone poll system to decide whether Todd should live.

Fans voted for that Robin to die, and so the Joker killed him off in Batman #428.

In those halcyon days, there were other analog ways for fans to interact with the comic books they loved, most notably the letter columns printed in the backs of the books. Today, comic publishers have dropped such forums into the oubliette. 

Related: Why Surrealist Philip Colbert Is Tapping ’80s Band Devo to Bring Lobsters to the Metaverse

Now a new crypto-powered entertainment company aims to bring interactivity back to comics. 

Called InterPop, members of its creative team promised there will be similarly crucial decisions for fans to make in its storylines as its lines of comics roll out this year.

InterPop will start off by introducing a bunch of characters in its Emergents universe, starting with a book called The Nine, issue #0 of which will come out July 17.

“Characters are going to die over the course of this run of comics. And it will be fan decisions that will dictate who those characters are and what shoes they will be wearing,” Brian David-Marshall, InterPop’s president, said in an interview.

Related: Jay-Z to Auction ‘Reasonable Doubt’ NFT at Sotheby’s

Rachel Gluckstern, the editor of the comics, is a veteran of the big comics publishing houses. She sees fan voting as a slightly more humane way to get feedback “that doesn’t go by sales information,” she said. It’s an internet-era approach that evokes those old days of comic book letter columns. “This is a way for us to really understand what fans are thinking,” she said.

Origin story

The characters arose from a digital trading card game (TCG) that’s been in the works to run on the Tezos blockchain for some time. Emergents, once housed in Coase, a company founded by Tezos co-founder Kathleen Breitman, transferred the Emergents game’s intellectual property assets to InterPop, a subsidiary of Tezos TQ.

Tezos is a top-50 blockchain, with a $2 billion market cap. It ran one of the most successful initial coin offerings in 2017, promising a model of governance that would keep it up to date forever. It went live in late 2018. 

InterPop will create digital comics, collectibles and eventually in-game assets when Emergents goes live. All the comics will be available for free, but to take part in decisions about the books, fans will need to own actual issues by buying non-fungible tokens (NFTs) that represent particular issues.

The Nine #0 will release with multiple alternative digital covers, including those by well-known artists such as Madman’s Mike Allred and The New Mutants’ Bill Sienkiewicz.

All of the Interpop comics will be released on its dedicated e-reader web app for free. Those who’d like to get early access should visit the Interpop website and sign up for an online event on July 17. All attendees will get a free comic NFT and a free in-game NFT that will be playable once Emergents launches.

As for Tezos…

The comics, the cards and other collectibles will also be available on a secondary market called Minterpop. While direct purchases in the game and the comics can all be done with fiat currency using traditional payments, transactions on Minterpop will all be done using Tezos’ native token, XTZ.

All crypto will lean on the Kukai wallet technology, which the Interpop team said has made great strides in stripping away cryptocurrency’s complexity for new users.

The team expects the various Emergents properties will generate a large number of transactions on Tezos, especially if trading for in-game items on the secondary market on Emergents, where it will be encouraged, looks anything like it does in traditional video games, where it’s generally discouraged.

The secondary market for in-game assets is an extremely gray one now (if not even a little black), so one can only guess at the estimate, but it’s almost certainly in the billions of dollars.

The game

CoinDesk previously reported on Emergents as a game that will use blockchain technology to give users much more control over their card decks and collections and focus less on manipulating players into buying cards they don’t want or need. The core ideas are unchanged, but the team behind Emergents says it is now better resourced to deliver the sort of experience that will be competitive with the most popular TCGs.

Blizzard Entertainment’s Hearthstone is the leader in the digital space, but the company that invented the underlying concept, Wizards of the Coast, released a mobile version of the classic analog game in March of this year (this reporter may or may not have burnt a considerable amount of time on it since then).

Emergents should be released in the fourth quarter, according to the InterPop team.

Until then, curious players can start getting familiar with the universe by checking out the early comics.

“We’re not really going into this superhero universe on an origin-by-origin issue. We’re kind of plopping people down in the middle of it,” David-Marshall said.

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Why Surrealist Philip Colbert Is Tapping ’80s Band Devo to Bring Lobsters to the Metaverse

5 years 3 months ago

British artist and designer Philip Colbert is about to make a splash, or rather a “pop,” in Decentraland, virtual-reality platform that runs on the Ethereum blockchain.

Colbert, the “neo-pop surrealist” best known for his colorful odes to lobsters, is launching his “Lobsteropolis City” and “Lobster Land Museum” in Decentraland, seeing the metaverse as a home for non-fungible token (NFT) exhibitions, among other things.

These other things include a musical performance in collaboration with legendary American art rockers Devo, titled “LOBSTER DE-VO.” The performance will serve as a launch for Colbert’s “Lobster Land” on Decentraland on Wednesday. It will feature a DJ set by Devo (a band that probably suits being cast as digital avatars better than any other on the planet). 

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Devo co-founder Gerald Casale provided the following quote in a press release:

“‘LOB-STER-DE-VO’ Clawing our way into the future. Breaking free. Looking for new traditions. Deevolution is real!” 

Doors will open on the Lobster Record store (Colbert plans more musical collaborations; think “Rock Lobster” by the B-52s), and an NFT auction in association with SuperRare, a digital art market, and dealer Simon de Pury will run in conjunction with Decentraland Art Week starting July 8. 

What telepresence?!

Colbert told CoinDesk he began looking at virtual world-building a few years ago, initially with the idea of using VR headsets and the like. 

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“As the creator, it felt insane to be actually in one’s own painting in a way,” Colbert said. “This heightened sense of experience just felt like a very profound, new way of making things and exploring creativity.”

The onset of the global pandemic gave things more of an other-worldly twist, as public spaces such as galleries were shut down. In response, Colbert held a show at London’s Saatchi Gallery using “telepresence robots” that could view the exhibition remotely for the public via a mobile phone.

The rise of NFTs early this year prompted Colbert to dive into Decentraland, which now operates as a decentralized autonomous organization (DAO) governed by token holders. He was put in touch with James Ashton, CEO of Vegas City, one of the largest districts in the Decentraland metaverse, which is hosting Lobsteropolis across its 57 parcels of virtual land.

“I just started translating my world into the Decentraland model,” said Colbert, who has experience in 3D modelling and digital rendering, and who enlisted help from the team at Vegas City in coding everything up. He added:

“Digital art is a great medium, but it’s not doing anything conceptually to further reinvent and recontextualize the possibility of that art. Rather than doing another virtual gallery show, I wanted to make this the experience of going into my actual world.”

Why lobsters? 

“Lobsters have an iconic, historical lineage in art,” Colbert said, “from occupying a central position in Dutch still life painting, to later becoming a symbolic protagonist of surrealism.”

Now the colorful crustacean may also find its footing in the metaverse.

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