CoinDesk Crypto

The near 10% sell-off in bitcoin (BTC) during Asian hours has stabilized around $52,000. Bitcoin is now oversold on the four-hour chart, which could support a slight recovery towards $56,000.  

• The last oversold reading on the relative strength index (RSI) resulted in a near 7% rise in BTC on March 22. However, the move was short-lived as sellers were active around the $56,000 resistance level.
• Bitcoin is now roughly 10% below its break of trend support on the four-hour chart and has erased about 50% of its rally from the Feb. 28 price low.
• For now, bitcoin continues to hold long-term trend support above $50,000, with lower support around $42,000.

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The near 10% selloff in bitcoin (BTC) during Asian hours has stabilized around $52,000. Bitcoin is now oversold on the four-hour chart, which could support a slight recovery towards $56,000.  

• The last oversold reading on the relative strength index (RSI) resulted in a near 7% rise in BTC on March 22. However, the move was short-lived as sellers were active around the $56,000 resistance level.
• Bitcoin is now roughly 10% below its break of trend support on the four-hour chart and has erased about 50% of its rally from the February 28 price low.
• For now, bitcoin continues to hold long-term trend support above $50,000, with lower support around $42,000.

• Coinbase Announces New Presence in India Even as Potential Ban on Crypto Looms
• Bitcoin Options Traders Position for Gains (to $80K?) in Historically Bullish April
• Cboe Eyes More Crypto Offerings as Demand Rises: Report
• RBI Is Assessing Digital Rupee’s Impact on Financial Stability, Says Governor Shaktikanta Das

Some bitcoin options traders are betting that this year’s price rally, which paused in recent weeks, will resume in April – historically a strong month for the market.

Among options listed on the dominant Deribit exchange with an April 30 expiry, the most common open position is the $80,000 call, data shared by the options analytics platform Laevitas shows. Deribit is the world’s largest crypto options exchange by trading volumes and open interest.

That’s a sign of high price expectations for April, as noted on Twitter by on-chain analytics firm Glassnode founders Jan Happel and Jann Allemann. Bitcoin is currently changing hands around $53,000, up 83% on the year. But the market has stagnated since reaching an all-time high above $61,000 on March 13.

Related: Coinbase Announces New Presence in India Even as Potential Ban on Crypto Looms

As highlighted by CoinDesk on Wednesday, the near-term focus in the bitcoin options market is on this Friday’s March expiry, where a record $6 billion of contracts are set to come due, with some analysts warning of an extreme pullback to what’s known as the “max pain” point, seen at $44,000.

But if that expiry comes and goes without any major price fluctuations, the bullish bets for April would come into view.

A call option gives the purchaser the right but not the obligation to buy the underlying asset at a predetermined price on or before a specific date. Essentially, it’s a bullish bet on the underlying asset.

The total open interest in the $80,000 call option is 4,469 contracts, or 240 million at press time. The option is currently drawing a premium of 0.0160 BTC on Deribit – a relatively cheap rate that reflects just how far out of the money the $80,000 strike price is.

Related: Bitcoin Stabilizes After Selloff, Resistance Seen Around $56K

Theoretically, the $80,000 call represents a bet that bitcoin would settle above that level on April 30. That doesn’t necessarily mean buyers of the $80,000 call option are anticipating a rally above that level by the end of April.

Traders often purchase deep out-of-the-money calls even when expecting a moderate bull run, because they can gain significant value as prices rise, yielding handsome returns on a small investment.

Statistically speaking, the seasonality for April is biased bullish.

Historical data shows bitcoin has chalked out gains in April in eight out of the last ten years.

Also read: Bitcoin Traders Brace for Record $6B in Options to Expire Friday 

• Cboe Eyes More Crypto Offerings as Demand Rises: Report
• RBI Is Assessing Digital Rupee’s Impact on Financial Stability, Says Governor Shaktikanta Das

Cboe Global Markets is looking to broaden its return to cryptocurrency by introducing new products and possibly re-listing bitcoin futures, according to CEO Ed Tilly.

• Tilly told Bloomberg in an article published Thursday that the exchange holding company has not “given up” on bitcoin futures despite prior aborted attempts in the space.
• Cboe started listing bitcoin futures in 2017 but ended its offering two years later.
• The exchange also officially filed to list shares of VanEck’s bitcoin exchange-traded fund (ETF) March 2 in hopes that the company’s application to the U.S. Securities and Exchange Commission (SEC) is approved.
• “We’re keen on building out the entire platform. There’s a lot of demand from retail and institutions, and we need to be there,” Tilly said.
• Chicago Mercantile Exchange (CME), a Cboe rival, went live with its futures contract for ether in February.
• Institutional interest in cryptocurrency has surged in recent months with several banking giants expressing positive sentiment and a growing number of companies have introduced investment products like ETFs in the space.

See also: Cboe Plans to Launch Cryptocurrency Indexes in Q2 2021

• RBI Is Assessing Digital Rupee’s Impact on Financial Stability, Says Governor Shaktikanta Das
• IBM Ventures Further Into Crypto Custody With METACO, Deutsche Bank Tie-Ups
• Goldman Files to Offer Notes Linked to an ARK ETF That May Have Bitcoin Exposure
• Fidelity-Affiliated Fund Files for Bitcoin ETF

The Reserve Bank of India (RBI) is examining the impact of the digital rupee on the country’s financial stability.

“While we are working on introducing the digital version of the fiat currency, RBI is also assessing the financial stability implications of introducing CBDC,” Das said on Thursday during his speech at the Indian Economic Conclave 2021, according to The Indian Express.

The governor added that the central bank has conveyed its concerns regarding cryptocurrencies to the Indian government, which is planning to table a bill in the parliament seeking to ban private cryptocurrencies and facilitate the development of the RBI’s digital rupee. “The matter is still under examination, and the government will come out with a decision on it,” Das said.

Related: Cboe Eyes More Crypto Offerings as Demand Rises: Report

The central bank prohibited commercial banks from providing banking services to cryptocurrency traders and exchanges in April 2018. However, that ban was overruled by the Supreme Court of India in March last year, to the relief of exchanges servicing Indian clients.

While both the RBI and the government appear biased against private cryptocurrencies, prominent technocrats such as tech-giant Infosys’ non-executive Chairman Nandan Nilekani have said they believe cryptocurrencies should be considered a separate asset class.

Also read: India May Block IP Addresses of Crypto Exchanges: Report

• IBM Ventures Further Into Crypto Custody With METACO, Deutsche Bank Tie-Ups
• Goldman Files to Offer Notes Linked to an ARK ETF That May Have Bitcoin Exposure
• Fidelity-Affiliated Fund Files for Bitcoin ETF

IBM, known for pitching banks and blue-chip firms on private blockchain technology (the sector’s equivalent of alcohol-free beer) is taking decisive steps toward working with the hard stuff.

The 110-year-old computing giant is licensing its software to METACO, a Switzerland-based firm that specializes in custodying digital assets for financial institutions, the companies said Thursday. This is the business of safeguarding the cryptographic private keys that control a cryptocurrency wallet, the 21st-century version of protecting a vault full of gold bars.

Separately, Deutsche Bank, Europe’s eighth-largest bank, is enlisting IBM’s help to build its planned crypto custody and trading services offering, two people familiar with the arrangement told CoinDesk. The parties are close but no deal is signed yet.

Related: Goldman Files to Offer Notes Linked to an ARK ETF That May Have Bitcoin Exposure

These are not IBM’s first steps into crypto custody; Big Blue has been quietly making moves into digital asset safekeeping since at least early 2019. Most recently, IBM’s Cloud Hyper Protect was teaming up with Zug, Switzerland-based decentralized finance (DeFi) data oracle, DIA (Decentralised Information Asset). 

IBM’s further wading into these waters speaks to a broader change in the posture of corporates toward crypto. In the late 2010s, the preferred approach for banks and other large companies was to try to shoehorn blockchain, the decentralized recordkeeping method pioneered by Bitcoin creator Satoshi Nakamoto, into their processes to create more efficient databases. Like many big companies, IBM enthusiastically backed the enterprise blockchain trend, which has turned out to be a slow and relatively fruitless grind. 

Read more: NY Gov. Cuomo Announces Pilot Project Using IBM’s Blockchain-Based COVID-19 App

Meanwhile, financial institutions have woken up to public blockchains and crypto assets, and that’s where the action is, the sector’s well-known volatility and manifold operational and regulatory risks notwithstanding. Banking being the biggest client industry sector at IBM, it’s the natural infrastructure choice for most banks and large financials looking for a toehold in the growing crypto asset space. 

Related: Fidelity-Affiliated Fund Files for Bitcoin ETF

“Large enterprises are going to focus on where the rapid growth of demand is, and right now that is on decentralized finance services on public blockchains,” said Paul Brody, blockchain lead at consulting giant EY. “Firstly, transaction-centric banks want to offer crypto assets to their customers, and secondly, firms want to tokenize traditional assets, and plug them into the DeFi.” 

The bitcoin price rally this year has caught many market participants by surprise, leaving some native crypto firms looking to improve their infrastructure, and banks scrambling to build out digital asset strategies, according to Adrian Patten, co-founder of Cobalt, a firm that’s trying to rewire crypto to work as smoothly as institutional foreign exchange trading. 

“IBM naturally sells to banks and is very well positioned,” said Patten, whose firm has also partnered with METACO around crypto custody. “A core part of providing custody is the secure management of keys. Many firms use IBM hardware for that and it’s going to be interesting to see what they do next to enhance the functionality of what’s being offered.”

Under the deal announced Thursday, METACO will protect against data breaches and cyber threats using IBM’s Cloud Hyper Protect Services and “Keep Your Own Key” (KYOK) encryption software. The solution can be offered wholly in the cloud (i.e., in IBM’s data centers), on premises (METACO clients’ servers), or in a hybrid environment, the companies said.

METACO has emerged as a go-to digital asset custody provider for banks and financial institutions, particularly in crypto-friendly Switzerland and across Europe, having provided tech to allow safekeeping of bitcoin and other virtual assets for megabanks Standard Chartered, BBVA and the Swiss-based division of Russia’s GazpromBank. 

Read more: IBM, Top Australian Banks Execute Country’s First Blockchain Bank Guarantee

Neither IBM nor METACO would make executives available for interviews. Deutsche Bank did not return requests for comment.

Hillery Hunter, an IBM fellow, vice president and the chief technology officer of IBM Cloud, said in a statement:

“As companies such as METACO continue to help the world’s top banks and exchanges manage their digital assets, IBM’s confidential computing capabilities help its clients ensure their data and processes are managed securely, bringing trust into the ecosystem and providing privacy assurance.” 

“This integration will allow us to deliver greater levels of security and trust to our clients as they innovate in the digital asset space,” said Adrien Treccani, th CEO and founder of METACO.

• Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency
• Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan

Goldman Sachs dipped another toe into the cryptocurrency pool by filing to offer notes linked to the performance of an exchange-traded fund (ETF) that may have exposure to cryptos such as bitcoin.

• In a filing with the U.S. Securities and Exchange Commission, Goldman said it plans on offering $15.7 million of the “autocallable contingent coupon ETF-linked notes due 2026.”
• Payout on the notes would be dependent on the performance of the ARK Innovation ETF, an actively managed fund offered by Cathie Wood’s ARK Investment Management.
• The ARK Innovation ETF’s strategy involves exposure to companies that are capitalizing on disruptive innovation and developing technologies, including blockchain.
• The ETF may also have exposure to cryptocurrency, such as bitcoin, indirectly through an investment in a grantor trust, according to the filing.
• The filing continues a trend by Goldman of offering structured notes with payouts tied to the performance of other instruments or funds with possible bitcoin exposure and that trend seems to be accelerating. A keyword search of such filings yielded 81 results from 2021 with no results showing up for prior years. Of the 81 results from 2021, 15 were from January, 28 were from February and 38 were from March.
• The filing comes weeks after Goldman President and Chief Operating Officer John Waldron reportedly said the investment banking giant has been seeing more demand for bitcoin among its clients and that while the bank was “regulated” on what it could do, Goldman continues to “engage” with clients.
• It also comes after the bank recently relaunched its cryptocurrency trading desk with the intention of supporting futures trading for bitcoin, three years after shelving plans to do so.
• Meanwhile, the multinational investment bank has issued a request for information to explore digital asset custody, as CoinDesk previously reported.

UPDATE (March 25, 00:33 UTC): Updates to note increasing trend of Goldman offering structured notes linked to instruments or funds with possible exposure to bitcoin.

• Fidelity-Affiliated Fund Files for Bitcoin ETF
• Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency
• Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan
• Bitcoin vs. Penny Stocks: How Do They Compare?

An affiliate of investment giant Fidelity is seeking to offer a bitcoin exchange-traded fund in the U.S. market.

• A Wednesday filing with the U.S. Securities and Exchange Commission (SEC) seeks approval for the “Wise Origin Bitcoin Trust,” an exchange-traded fund with multiple ties to Fidelity.
• Fidelity affiliates serve as the fund’s sponsor, administrator, custodian and trustee, the filing states. The fund would track the performance of Fidelity’s bitcoin index.
• Peter Jubber, the managing director of Fidelity Digital Funds, serves as president of the trust.

See also: Fidelity’s Chief Strategist Starts Bitcoin Index Fund

This is a developing story.

• Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency
• Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan
• Bitcoin vs. Penny Stocks: How Do They Compare?
• Abra Jumps Into the Crypto Borrowing and Lending Business, Questions Inflation Reports

Canada’s tax authority, the Canada Revenue Agency (CRA) has prevailed in a court battle for access to a trove of high-value customer data held by cryptocurrency exchange Coinsquare. And the CRA seems to be coming for more.

Under a federal judge’s March 19 order, Coinsquare must hand over detailed information on its Canadian customers, their crypto trading activity and identifying information to the Canada Revenue Agency (CRA).

Coinsquare told CoinDesk that it will disclose information on an estimated 5% to 10% of its 400,000 customers to the CRA, which had originally sought to secure the lot. Court documents indicate only high value accounts will be caught in the sweep.

Related: Fidelity-Affiliated Fund Files for Bitcoin ETF

The first of its kind ruling hands CRA a win just seven months after it began pursuing Coinsquare’s customer data in court. CRA argued it needed the data to check if taxpayers were meeting their crypto reporting burdens and the federal court agreed.

Today, CoinDesk also learned that the tax authority is “currently in the process of serving” Coinsquare with a further request for customer information by means of an “Unnamed Persons Requirement” (UPR). According to a spokeswoman for the CRA, the agency needs Coinsquare’s customer information to verify compliance with Canada’s Income Tax Act (ITA) and Excise Tax Act (ETA).

Coinsquare will have 15 days to comply with the order once it is received.

Five years ago, the Internal Revenue Service, CRA’s southern peer, launched a similar effort against Coinbase, using a parallel argument for access. Though Coinbase at first lambasted the IRS’ “fishing expedition” it ultimately acceded to a judge’s order, handing over records on some 13,000 customers.

Related: Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan

At the time, Coinbase called the outcome a “partial victory” because it said it had pared down the scope of the IRS’ demands to include only accounts trading more than $20,000. 

Coinsquare echoed that sentiment on Tuesday as it touted the pared-down order secured through negotiations with CRA as a win.

Coinsquare’s final bargain will compel the crypto exchange to hand over at year’s end exhaustive data on accounts that held $20,000 CAD in crypto from 2014-2020 or cumulatively in their history, as well as the 16,500 largest accounts from each year.  

“Coinsquare negotiated to protect its clients’ privacy, and limit any disclosure to only what was absolutely required by the CRA under Canadian tax law,” Coinsquare told CoinDesk. 

“Instead of providing the CRA with all client data dating back to 2013 as was initially requested, Coinsquare and the CRA have agreed that information relating to 90-95% of Coinsquare’s clients will not be disclosed.”

The CRA spokeswoman said the agency “reserves the right” to mount future taxpayer data collection efforts against Coinsquare and “other sources.” However, she said the pared-down court order “appears sufficient to verify compliance with the ITA and/or the ETA.”

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• Abra Jumps Into the Crypto Borrowing and Lending Business, Questions Inflation Reports

China’s central bank and the U.S. Federal Reserve agree that a fully anonymous national digital currency is not feasible. But Fed Chair Jerome Powell believes when a digital dollar is developed it must provide users with more privacy than the People’s Bank of China’s (PBOC) planned digital yuan. 

“The lack of privacy in the Chinese system is just not something we could do here,” Powell said while testifying before the House Committee on Financial Services on Tuesday. “We’re only beginning to think carefully about these things and it’s going to be a careful, detailed and probably lengthy process of consideration.” 

Powell’s comments came after Changchun Mu, the head of PBOC’s digital currency arm, was reported as claiming the digital yuan will offer greater privacy protection than any other digital payment system. 

Related: Fidelity-Affiliated Fund Files for Bitcoin ETF

Read more: People’s Bank of China Official Says Fully Anonymous Digital Yuan ‘Not Feasible’

The Chinese official said the digital yuan will have “controllable anonymity,” in which the most private account would only require a cell phone number. However, people need to register with a phone service carrier with their ID to have a phone number. Users would also have to disclose more personal information if their deposit amount hits a certain threshold. 

The Fed has not specified how much anonymity any digital dollar would allow users to have, in part because there is no concrete timetable for a digital dollar. While there will be detailed research on the proposed stablecoin coming out as early as July, Fed officials have yet to disclose whether the central bank would host customer accounts or enlist a trusted third party, and what privacy protections users would have in case of a breach. 

Read more: Fed Chairman Powell: We Will Engage the Public on the Digital Dollar This Year

Related: Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency

Powell said he agreed with Rep. Bill Foster (D-Ill.), who said during the hearing an anonymous, untraceable digital dollar “is not a viable option for our country or free world” because of the potential for money laundering or funding terrorism.

Powell and Treasury Secretary Janet Yellen, who also testified before the committee, have voiced their concerns in recent months about how cryptocurrencies could be used for such illicit transactions because of their anonymous nature. 

• Bitcoin vs. Penny Stocks: How Do They Compare?
• Abra Jumps Into the Crypto Borrowing and Lending Business, Questions Inflation Reports

• Bitcoin (BTC) trading around $54,771.18 as of 20:00 UTC (4 p.m. ET). Slipping 0.63% over the previous 24 hours.
• Bitcoin’s 24-hour range: $53,577.33-$57,225.30 (CoinDesk 20)
• BTC trades below its 10-hour and 50-hour averages on the hourly chart, a bearish signal for market technicians.

The “Elon Candle” effect on bitcoin appears to be short-lived.

The market jumped early Wednesday after Tesla CEO Elon Musk announced the electric vehicle maker plans to now accept bitcoin as a payment option, and that it won’t convert any receipts of the cryptocurrency back into U.S. dollars. 

On the U.S.-based Coinbase exchange, bitcoin’s price briefly shot above $57,000, compared with the prior day’s $54,400. The reaction recalled the action on Feb. 8 when prices jumped more than $7,000 – the most ever for a single day – after Musk tweeted that Tesla had bought $1.5 billion worth of bitcoin. Traders and T-shirt marketers nicknamed the episode “Elon’s Candle,” after the corresponding vertical shape created on a daily price chart.  

Related: Fidelity-Affiliated Fund Files for Bitcoin ETF

Read More: Bitcoin Rises Despite Dollar Strength as Elon Musk Adds BTC Payment Option

But this time around, the market couldn’t hold onto the gains. At press time, the oldest cryptocurrency was changing hands at $54,599.71, down 0.50% in the past 24 hours.

“Bitcoin received a small bullish bump” from Tesla’s latest news, said Jason Lau, chief operating officer at San Francisco-based crypto exchange OKCoin. “However, bitcoin is still in consolidation mode as traders are still digesting these levels.”

In traditional markets, the dollar index (DXY) rallied to four-month highs Tuesday, and yields on the 10-year U.S. Treasury note dipped slightly to 1.62%, down from last week’s one-year high above 1.7%.

Related: Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency

The bitcoin market, meanwhile, is in a “wait-and-see” mode, Lau said.

Such hesitation is also apparent in the bitcoin derivatives market, where the open interest on futures contracts has remained relatively stable since it reached an all-time high on March 13.

Ether (ETH) was down on Wednesday, trading around $1,637.26 and slipping 4.38% in 24 hours as of 20:00 UTC (4:00 p.m. ET).

The No. 2 cryptocurrency by market capitalization has declined for the fifth straight day, to the lowest point in two weeks. It briefly spiked with bitcoin after Musks’ tweet, to as high as $1,740.58. However, as with bitcoin, the gains dissipated quickly, according to CoinDesk 20.

Ether “has stalled below final resistance from February, a minor hurdle to new all-time highs, after showing signs of exhaustion,” Katie Stockton, a technical analyst for Fairlead Strategies, wrote in an email to CoinDesk.

The Ethereum developer community has recently began spitballing possible dates for speeding up the blockchain network’s transition to a proof-of-stake consensus mechanism, as CoinDesk’s Valid Points newsletter reported earlier Wednesday.

Read More: Valid Points: How Ethereum’s Governance Process Alters ‘The Merge’

Some members expressed worries that future Ethereum Improvement Proposals (EIPs) would likely decline as more developers focus on “the Merge” to Eth 2.0 once it is approved.

Digital assets on the CoinDesk 20 are mostly in red Wednesday. The notable winner as of 20:00 UTC (4:00 p.m. ET):

• tezos (XTZ) + 3.98%

Notable losers:

• xrp (XRP) – 5.53%
• orchid (OXT) – 5.11%
• chainlink (LINK) – 4.84%
• kyber network (KNC) – 4.78%
• cosmos (ATOM) – 3.78%

Equities:

• Asia’s Nikkei 225 closed lower by 2.04%.
• The FTSE 100 in Europe closed in the green 0.20%.
• The S&P 500 in the United States closed down 0.55%.

Commodities:

• Oil was up 5.18%. Price per barrel of West Texas Intermediate crude: $60.75.
• Gold was in the green 0.38% and at $1733.81 as of press time.

Treasurys:

• The 10-year U.S. Treasury bond yield fell Wednesday dipping to 1.615%.

• Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan
• Bitcoin vs. Penny Stocks: How Do They Compare?

Tech giant Microsoft Corp. President Brad Smith criticized financial technology firms attempting to issue currencies, saying governments are best suited to play this role, according to a Bloomberg report.

• Speaking at a Bank for International Settlements conference on Wednesday, Smith said he is not a big fan of encouraging Microsoft to participate in the issuance of a digital currency, the report said.
• “The money supply almost uniquely needs to be managed by an entity that is responsible to the public and thinks really only about the public interest, and that means governments,” said Smith.
• One such private firm trying to issue its own digital currency is social media giant Facebook, which is seeking to launch the stablecoin diem (originally called libra).
• The prospect caused policymakers and regulators from around the globe to express their concerns over potential privacy and money-laundering risks, as well as the possible loss of control over the monetary system.
• “I think the world has been better served by what has been a movement over centuries to put that [digital currency] in the hands of governments. We’re not a bank and we don’t want to become a bank and we don’t want to compete with our customers who are banks,” said Smith.

Read more: Microsoft and Enjin Bring Cross-Platform Custom NFTs to Minecraft

• Fidelity-Affiliated Fund Files for Bitcoin ETF
• Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency
• Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan
• Bitcoin vs. Penny Stocks: How Do They Compare?

McLaren, the legendary Formula 1 auto racing team, has entered into a long-term partnership with Turkish crypto firm Bitci.com to create an official fan token for the team. 

The U.K.-based McLaren will launch its fan token – which it says is the first of its kind in Formula 1 racing – through the new partnership. Bitci.com will also become an official partner of the racing team, according to Wednesday’s announcement. Bitci.com is a Turkish cryptocurrency exchange with around $50 million in 24-hour traded volume. 

McLaren joins other prominent sports teams that have launched fan tokens. The digital limited-edition tokens allow a sports team to make partners out of their fans: token owners earn voting rights on certain decisions made by the teams and other benefits specific to different sports clubs. In 2020, premier league soccer club FC Barcelona made $1.3 million in sales after launching its fan token $BAR. 

Related: Fidelity-Affiliated Fund Files for Bitcoin ETF

Earlier this month, Malta-based fan token platform Chillz said it plans to spend $50 million to expand operations to include teams from major U.S. sports leagues like baseball and football. 

Read more: Fan Token Platform Chiliz Plans to Splash $50M on Expansion Into US Sports Leagues

The McLaren token will be issued on Bitci.com’s native blockchain Bitci Chain that was developed in 2020.

In 2020, Turkey hosted the Formula 1 Turkish Grand Prix for the first time since 2011. Due to the pandemic, the country decided to go ahead with the race but without fans attending. The global audience for the 2020 Grand Prix was an estimated 433 million. 

Related: Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency

“The fact that McLaren Racing, one of the most outstanding teams and considered as one of the legends of Formula 1 all over the world with its successes, has chosen to work with a Turkish blockchain company for this project is very significant as this is the solid proof for the global success of Turkish entrepreneurs, engineers and software developers,” Çağdaş Çağlar, chairman at Bitci Technology said in a press statement.     

The McLaren team, founded in 1963, has had over 180 race wins.  

• Fed Chair Powell: Digital Dollar Would Need Stronger Privacy Than Digital Yuan
• Bitcoin vs. Penny Stocks: How Do They Compare?

When news broke that Turkey’s President Recep Erdoğan had suddenly replaced the head of the nation’s central bank on March 19, Tilbe Yardım, 30, rushed to convert her Turkish lira into crypto. 

“Turkish investors and people who understand finance are really angry and saddened about what happened on Friday night,” Yardım told CoinDesk. 

The abrupt firing marked the third replacement of a central bank chief by Erdoğan since mid-2019, and signaled currency and institutional instability to investors. Erdoğan, who favors unorthodox monetary policies like slashing interest rates to curb inflation, allegedly fired the central bank head after he raised interest rates. Following Erdogan’s surprise move the lira, Turkey’s local currency, plunged 15% against the U.S. dollar on Monday, although it has recovered slightly since then. 

Related: Fidelity-Affiliated Fund Files for Bitcoin ETF

Central bank instability tends to attract people to cryptocurrency. As the lira dropped on Monday, internet searches about cryptocurrencies spiked in Turkey, while searches for precious metal gold (Turkey’s go-to safe-haven asset) remained flat. In Turkey, where the crypto space is not regulated, its young tech-savvy population can buy and trade digital assets freely. Crypto exchanges do not need licenses to operate and there are currently no specific tax laws that apply to crypto. 

But the uptick in crypto searches on Monday is the continuation of a much larger story. Turkish interest in crypto has been growing steadily for years, according to Ismail Hakki Polat, lecturer at the Kadir Has University in Istanbul, Turkey, where he teaches a course on cryptocurrency and blockchain. 

Read more: Bitcoin Searches Spike in Turkey as Central Bank Chief Fired, Lira Plummets

“From the very beginning of bitcoin, Turkish people have been eager for and interested in cryptocurrencies so it’s not a new thing like in Venezuela or Argentina,” Polat told CoinDesk, referring to countries that have more recently seen a dramatic growth in crypto use as a hedge against inflation.  

Related: Crypto Exchange Coinsquare Ordered to Hand Thousands of Customers’ Records to Canadian Tax Agency

In fact, local media reported that in the beginning of 2021, moving in tandem with the bitcoin price run, the two largest crypto exchanges in the country, Paribu and BtcTurk, were trading over $1 billion worth of crypto daily. By 3:12 p.m. local time on Wednesday, 11 popular crypto exchanges in the country recorded a combined 24-hour trading volume of more than $6 billion. 

Yardım discovered cryptocurrencies after her family business was put on hold when the COVID-19 pandemic hit last year. 

Her family’s factory – which produced and supplied baby clothing to their stores around the world – was shuttered for three months, and Yardım began looking for alternative ways to generate income. She felt that leaving her savings in the bank was “one of the worst things” to do because the Turkish lira had been depreciating against the dollar for some time now. 

“I decided to invest my money at least against inflation,” Yardım said.

Yardım has since invested her savings in bitcoin, ethereum and other cryptocurrencies. Although Yardım now uses Binance, she first invested in crypto via BtcTurk. In Turkey, interested investors can buy crypto on traditional crypto exchanges or by simply walking into a physical store at Istanbul’s Grand Bazaar. 

A 2020 crypto research report published by Turkey’s Information Technologies and Communications Authority (ICTA) estimated there were around 2.4 million crypto users in the country, about 3% of its total population. Polat feels this number might be much higher, especially after the 2020 bitcoin price run.

For instance, the average daily registrations of Turkish users on the British cryptocurrency exchange CEX.IO since March 14 is 783% higher than the first half of March and February, according to Konstantin Anissimov, its executive director.

Read more: Why Money Scarcity Means Someone Goes Hungry

Due to the availability of traditional exchanges in the country, peer-to-peer crypto trading platforms like LocalBitcoins are not as popular. But even LocalBitcoins is seeing considerable growth in Turkey this year. Between 2019 and 2020, new user registrations on the platform only went up by 10%, while in February 2021, new registrations and website traffic were three times higher than the average month in 2020, according to data shared with CoinDesk.  

One reason for the seemingly undeterred growth of Turkey’s crypto market is the absence of regulation. The government is, at least for now, staying out of the crypto space. 

“I think the regulations will eventually come, but not right now,” Polat said, adding that crypto is not the central bank’s top priority for the moment because the institution is dealing with an economic and currency crisis. 

On the one hand, regulations will be beneficial for the long-term acceptance of digital assets, and they will help dispel the common perspective that crypto is only used on the “dark web” for illegal transactions, Yardım explained. 

“On the other hand, government interaction would mean high taxes in Turkey. This is many crypto investors’ concern at the moment,” Yardım said. 

In 2018, Polat co-created an introductory course on cryptocurrency at Kadir Has University in Istanbul. Although he limited attendance to 30 students at the start, Polat says requests to join the class started increasing after large institutions including MicroStrategy and Tesla invested in bitcoin during the price run. Responding to the interest, he decided to open the class to students from other departments in the university and integrated a program that gave 30 more students from any profession the opportunity to take the course.   

Around 200 people have completed the course since its launch, Polat said. 

“Especially youngsters are very eager to experience and learn about cryptocurrencies … I mean, youngsters generally don’t prefer gold or don’t understand gold, but then they discovered ‘digital gold,’” Polat said.  

Read more: MMT, Crypto and the New Nature of Money 

Of course, some young Turks may just be looking at crypto as an escape from the country’s economic crisis. 

“Let’s say if crypto was not profitable, would anyone invest? Would Americans invest? Would [Turks] invest? Of course not,” Yardım said. 

Turkish youths are open-minded and are fond of new technologies and trends, Yardım explained, adding that her 17-year-old cousin is not only investing in crypto but also mining. 

“Crypto means basically two things to the young people in Turkey: future and freedom,” Yardım said. 

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Bitcoin’s developers and community members seem to have finally settled on a timeline to activate Taproot, Bitcoin’s biggest upgrade since SegWit in 2017.

Per notes from a public Internet Relay Chat (IRC) meeting, the code for Taproot could be ready for users to active in the Bitcoin Core client via “Speedy Trial” in May of this year. If Speedy Trial is successful, this would mean the upgrade could be online in November.

“There is broad agreement that we should target something like a May 1st release, with [a 1 week signalling start time afterwards],” Bitcoin Core contributor Jeremy Rubin wrote in meeting notes. If successful, this would mean an “activation time of around Nov 15th,” he notes.

Related: What’s Next for Bitcoin? Levels to Watch

Speedy Trial allots a three-month trial period to see if miners representing at least 90% of Bitcoin’s hashrate will signal their support for the upgrade. If this threshold is reached, then Speedy Trial is successful and the upgrade will be “locked in” three months after the beginning of signaling. After this, Taproot’s rules would be officially enforced in another three months.

(If, for example, signaling were to begin on May 7 and miners showed sufficient support, then Taproot would be locked in on August 7 and go live on November 15; the later the signalling begins, the later the activation). New code in Bitcoin Improvement Proposal 8 (BIP8) will set the parameters for the Taproot activation, which will judge when to lock in the upgrade based on block height.

As stakeholders appear to be in agreement on the timeline, bitcoiners finally have a (more or less) concrete deadline for when they can expect Taproot’s code to be available to the public to download, marking an end to what has become a painstaking road to a relatively simple upgrade.

There is still the caveat that May 7 may not be the exact start date of Taproot’s activation, but it will likely be somewhere around that time.

Related: DeFi Deep Dive: Why Decentralized Exchanges?

As ever in Bitcoin’s development, upgrade parameters are in constant flux because no single person or organization has final say over how development should proceed. It’s up to Bitcoin’s distributed, international community to come to a consensus on what changes to make to Bitcoin and, just as importantly, as evidenced by the Taproot activation discussion, how those changes will be brought online.

Take the so-called “user-activated soft fork” (UASF) that was so hotly debated during the Taproot activation discussions. This would give node operators the option to force activate Taproot should miners fail to update their own nodes with the upgrade by rejecting blocks from noncompliant miners. 

Miners have given no indication, though, that they will reject Taproot, and the UASF proposal lacked enough support to make its way into Bitcoin Core, the software implementation that 99% of the Bitcoin network runs.

Still, Luke Dashjr and others are coding up a UASF that anyone can opt-in to (but which won’t be included into Bitcoin Core) in case Speedy Trial fails. If Speedy Trial were to fail, then nothing would happen and Taproot would simply fail to activate; under this scenario, a UASF could be deployed, probably next year, to bring the upgrade online.

This is largely unlikely, however, given broad miner support for the uncontroversial upgrade.

Thanks to Ben Carman for feedback and input.

• Bitcoin Traders Brace for Record $6B in Options to Expire Friday
• Bitcoin News Roundup for March 24, 2021

They call it “max pain” in the bitcoin options market: How to make one’s trading counterparty suffer the most. 

Although the largest cryptocurrency was changing hands Wednesday around $56,500, traders were handicapping the odds of a plunge to about $44,000 by Friday, when a record $6 billion of options contracts is set to expire. 

A drop to that price level would inflict “max pain” on buyers of options contracts, and it might be the most profitable price point for options sellers. It’s a remote risk, but not one to be discounted.

Related: What’s Next for Bitcoin? Levels to Watch

The max pain theory states that the market will gravitate toward the pain point while heading into the expiry. That’s because sellers – typically institutions or sophisticated traders with ample capital supply – often try to push the price toward the max pain point by buying or selling the asset on spot or futures markets. 

The bullish spin is that if bitcoin makes it through Friday without a major correction, a major overhang will be lifted.     

“Max pain for the March 26 expiry is currently $44,000 on Deribit,” Luuk Strijers, CCO of Deribit, the world’s largest crypto options exchange by trading volumes and open positions, told CoinDesk. “That does not mean the market will move to $44,000 by the end of this week, but it does imply that after Friday this potential downward pressure no longer exists.”

Max pain is calculated by adding the outstanding put and call dollar value of each in-the-money (ITM) strike price. An ITM call is one where the strike price is below the spot market price, while a put is considered ITM when the spot market price is below the put option’s strike price. 

Related: DeFi Deep Dive: Why Decentralized Exchanges?

A potential unwinding of trades as Friday’s expiry approaches may inject some volatility into the market, according to Pankaj Balani, co-founder and CEO of Delta Exchange. 

Carry trading, or cash and carry arbitrage, is a market-neutral strategy that seeks to profit from increasing and decreasing prices in one or more markets. It involves buying the asset in the spot market and simultaneously selling a futures contract against it when the futures contract is trading at a significant premium to the spot price. That way, savvy traders can lock in fixed returns, as the futures price converges with the spot price on the day of expiry. 

“We also saw a lot of carry trades this expiry as the futures premium expanded from 15% to 25% per annum earlier this year,” Balani said, adding that 60% of the short futures positions opened in carry trades are yet to be rolled over to the April expiry. Rolling over short futures means carrying over bearish positions from the current expiry to the next month.

The rollover, however, may not happen if the futures premium shrinks in the next two days. In simple words, carry trades will be squared off: Short futures positions will be squared off or allowed to expire, and the long positions held in the spot market could be dumped, leading to increased price volatility. 

Also read: This Ether Options Play by Institutions Has Lottery Ticket Potential

“If the premium on futures shrinks, then we can see the unwinding of the carry trade, which can increase short-term volatility on expiry day,” Balani told CoinDesk in a WhatsApp call. 

“Traders have sold puts much more aggressively in this expiry,” Balani said, adding that if the market starts falling due to some reason, these short put positions will be squared off. That would add to bearish pressures around the cryptocurrency ahead of the expiry.

• New Taproot Activation Timeline Means the Upgrade Is (Probably) Coming to Bitcoin This Fall
• Bitcoin News Roundup for March 24, 2021

Cryptocurrency exchange FTX has secured the naming rights to the home arena of NBA team Miami Heat for a reported $135 million.

• The Miami Herald reported Tuesday that the 19,000-capacity American Airlines Arena will become the FTX Arena.
• This is the first occurrence of a crypto business winning the naming rights to a major U.S. professional sports venue.
• FTX came to an agreement in principle with Miami-Dade County for a 19-year partnership, meaning the arena will bear the exchange’s name until 2040.
• The agreement will go to the Miami-Dade County Board of County Commissioners for final approval at a special meeting on March 26.
• This is yet another sign of the increasing integration of the cryptocurrency industry into the mainstream, which has been gathering great speed this year.
• This year has also seen exchange Crypto.com secure a partnership with the Montreal Canadiens to have its logo brandished on the ice at its home arena, the Bell Centre.

See also: NBA Top Shot Overwhelmed by Demand in Record $1M Pack Drop

• What’s Next for Bitcoin? Levels to Watch
• DeFi Deep Dive: Why Decentralized Exchanges?
• New Taproot Activation Timeline Means the Upgrade Is (Probably) Coming to Bitcoin This Fall
• Bitcoin Traders Brace for Record $6B in Options to Expire Friday

Sovryn, a project that aims to bring decentralized finance (DeFi) to Bitcoin, is in the final stages of approving a 180 BTC investment from “Pomp” but only under certain circumstances.

Under the terms of the proposal, cryptocurrency evangelist Anthony “Pomp” Pompliano would invest 180 bitcoin, worth around $10 million at today’s prices.

While this might seem like yet another crypto investment story, this one is notable for the efforts Sovryn is taking to ensure that its existing token holders aren’t marginalized simply because it’s getting a big investment.

While in most cases decentralized governance goes out the window when well-heeled investors come knocking, Sovyn’s decentralized governance community is taking things slow to make sure all members will continue to have a say in the project’s governance.

Related: What’s Next for Bitcoin? Levels to Watch

As of this writing, a deal had still not been finalized. Jascha Samadi, co-founder and partner at Berlin-based early-stage venture fund Greenfield One, which led a seed round in Sovryn in 2020, said this marks the shape of things to come when it comes to decentralized projects and investing.

“The standard way fundraising decisions happen is the team’s treasury or the foundation’s treasury simply raise money by selling tokens to private investors, and it happens in a very closed circle,” said Samadi. “This is the first time that we actually see a team bringing a proposal like this to their community at such an early stage into their journey.”

Community-based governance and decentralized autonomous organizations (DAOs) have evolved like everything else in the crypto space. As well as day-to-day decision making and software updates, decentralized governance structures vote on big choices relating to fundraising and stakeholders being added to the community.

The proposed $10 million investment would be made by Pompliano’s new asset management firm, Pomp Investments. Until last September, Pompliano was in charge of investments into crypto at Morgan Creek Digital Assets. 

Related: DeFi Deep Dive: Why Decentralized Exchanges?

It’s worth noting that Sovryn is a buzzy project and earlier this month the community chose to sell $10 million worth of its SOV tokens. There are also conditions such as an extended lock-in period of 16 months for tokens.

While the investment itself is about bringing DeFi to Bitcoin, Pompliano agreed this marks a new chapter in decentralized investing.  

“You will see more proposal-based investment as the crypto industry deepens, with decentralized communities deciding on investments rather than traditional, centralized and founder-based decision-making,” Pompliano said in an interview. 

“DeFi” is the umbrella term for the exchange of cryptocurrencies or the lending and borrowing of them, carried out using business rules set out in computer code, which have typically flourished on the Ethereum public blockchain.

The Bitcoin blockchain, a straight up peer-to-peer payment network, is not the natural home for transactions that lock up funds, include outside data feeds and pay yields on assets. This requires some extra bells and whistles, which Sovryn adds in the form of parallel and uncluttered channels and enjoy the same unbreakable security as Bitcoin.

Sovryn project creator Edan Yago echoed Pompliano’s view of this as a new approach to investing.

“Many projects that are waving the flag of decentralization, but most of them ultimately have some kind of prime mover behind it,” Yago said in an interview. “I think one of the really interesting things with Sovryn is how radically and seriously the community takes this idea that there is no central authority behind the project.

• New Taproot Activation Timeline Means the Upgrade Is (Probably) Coming to Bitcoin This Fall
• Bitcoin Traders Brace for Record $6B in Options to Expire Friday

Esprezzo, a decentralized finance (DeFi) startup building data automation tools, raised $2 million from Mark Cuban, Arrington Capital and CMS Holdings, among others.

The round gives this three-year-old Boston company a capital boost ahead of its data automation suite rollout planned for later this year. It signals continued investor interest in the companies working to monetize the DeFi space through secondary applications. 

Cuban’s investment is his third bet on DeFi and blockchain projects since becoming an outspoken advocate for decentralized tech late last year. Since then he has introduced crypto payment options to the Dallas Mavericks, previewed a digital non-fungible token (NFT) art gallery and toured the podcast circuit talking up collectible digital assets.

Related: What’s Next for Bitcoin? Levels to Watch

“Everything is driven by fast and accurate access to data. Which is exactly what Esprezzo excels at. Their product is ‘fungibility at its best. It’s adaptable. It’s straightforward. It’s easy to configure and use,” said Cuban in an email to CoinDesk.

Founder Remy Carpinito said Esprezzo’s automation tools simplify data pull requests for on-chain sources like smart contracts, an essential DeFi building block. He said the tool’s no-code user interface offers veteran users a means to feed data to trading bots and gives newcomers a workaround for technical pitfalls.

DeFi refers to an ecosystem of products for lending, trading and exchanging digital assets, mostly through protocols atop the Ethereum blockchain. Traders are hungry for data that could give them an edge in the $43 billion DeFi sector.

After holding steady to a three-member team since pivoting to crypto in 2018, Carpinito said Esprezzo now plans to greatly expand its ranks to keep up with the DeFi boom. Its user base of 1,500 is growing rapidly, in large part due to the accelerating popularity of Esprezzo’s Uniswap trading pair discovery bot.

Related: DeFi Deep Dive: Why Decentralized Exchanges?

“Searching through block explorers was really the only method to see any on-chain data,” in 2018, Carpinito said, pointing to what he called a huge barrier to entry for retail traders and even experienced users. “We just want to make that as simple as possible.”

Carpinito said the funding from Cuban and other investors will go toward continued development of upcoming products like a more expansive notification platform called Dispatch that will cover protocols atop the Ethereum and Binance Smart Chain blockchains when it launches in Q2.

Dispatch is “protocol agnostic,” said Carpinito. He said Ethereum’s ongoing gas crisis, which has emboldened competing networks to vie for expat DeFi protocols, highlights the importance of casting a wide net for projects like Esprezzo.

• New Taproot Activation Timeline Means the Upgrade Is (Probably) Coming to Bitcoin This Fall
• Bitcoin Traders Brace for Record $6B in Options to Expire Friday