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Morocco Considers Launching a Central Bank Digital Currency

5 years 7 months ago

Morocco’s central bank, Bank-Al-Maghrib (BAM), is investigating the benefits of launching a central bank digital currency (CBDC).

  • BAM has launched an exploratory committee to investigate the pros and cons of a CBDC four years after banning cryptocurrencies, according to a Morocco World News report.
  • Morocco’s central bank is continuing to take a cautious approach due to the “speculative nature” of cryptocurrencies, the report said.
  • BAM’s new committee will seek to identify and analyze the advantages and drawbacks of CDBCs for the Moroccan economy, said the report.
  • Previously Morocco has expressed concern around the lack of regulation around cryptocurrencies and warned the use of virtual currencies entails significant risk for users.
  • Although bitcoin was banned for use in Morocco four years ago, the cryptocurrency continues to thrive in the country, with Nigeria, South Africa and Kenya being the only African countries with more trading volume.
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Canada’s First Bitcoin ETF Hits $421.8M AUM in Two Days

5 years 7 months ago

The first publicly traded bitcoin exchange-traded fund (ETF) in North America has collected $421.8 million in assets under management (AUM) in two days.

  • Purpose Investment’s bitcoin ETF officially started trading on the Toronto Stock Exchange (TSX) under the ticker “BTCC” on Thursday.
  • The fund has seen huge interest, trading well over $100 million shares on its first day, and by the end of Friday it had collected $421.8 million AUM.
  • Bloomberg Intelligence ETFs analyst Eric Balchunas tweeted the Purpose Investment’s bitcoin ETF could reach $1 billion in assets by the end of next week. 
  • On Friday, another bitcoin ETF, the Evolve ETF, started trading on the TSX under the ticker “EBIT” and has $1.271 million AUM.
  • Both Evolve and Purpose Investment’s bitcoin ETFs have a management fee of 1%.

Read more: State of Crypto: Will 2021 Finally Be the Year of the Bitcoin ETF?

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Bitcoin Crosses $57K, Setting Another All-Time High and Igniting a Crypto Rally

5 years 7 months ago

A day after the leading cryptocurrency rose more than $5,000 and along the way achieved a $1 trillion market cap, bitcoin (BTC) on Saturday morning set yet another all-time high, crossing $57,000 for the first time and sparking a broad rally among other cryptocurrencies.

  • The price of BTC reached a high of $57,492.00 before settling back to $57,264,55, up 8.77% over the last 24 hours. Before yesterday’s fun and games started, BTC was at about $51,600.
  • BTC ended 2020 at bit shy of $29,000 following a better-than 300% gain over the previous 12 months. Now, that eye-popping performance is starting to look tame as less than two months into 2021, BTC has nearly doubled, with a 95.4% gain.
  • Some are attributing the astonishing rise of BTC’s price to the tremendous demand from buyers looking to hedge against inflation as governments keep spending and central banks keep printing money trying to keep their economies going through the pandemic.
  • “Through the insatiable buy-side pressure from exchange-traded fund (ETF) issuers, closed-end funds and large public corporations adding bitcoin to their positions, demand is massively outstripping supply,” said John Willock, chief executive at digital asset exchange Blocktane. 
  • The current ramp-up in the price of BTC was ignited earlier in the month by Tesla, when the electric-automobile manufacturer announced it had purchased $1.5 billion of the cryptocurrency for its treasury. This sparked a round of playing “who’s next?” in terms of investing treasury funds in BTC and the resulting hype helped focus the attention of main street investors on the sector oversll.
  • Rising along with BTC has been Ether (ETH), the native token of the Ethereum blockchain. Late Friday night New York time, long after most of the action in BTC had died down for the moment, the price of ETH set a new all-time high of its own, crossing the $2,000 mark for the first time ever.
  • The excitement over BTC and ETH both hitting new peaks has now spread now to the rest of the crypto, with almost all tokens up Saturday morning and a number of them posting double-digit percentage gains.
  • Major advancers include: Polkadot (DOT), Cardano (ADA), Uniswap (UNI), Aave (AAVE), NEM (XEM) and Huobi Token (HT) . Still others such as Chainlink (LINK) hit all-time highs of their own.
  • While the gains in UNI and AAVE seem linked because both are major players in the exploding decentralized finance (DeFi) section of the crypto world, most of the Saturday’s gains may simply be due to investors looking for the next BTC or ETH or because advocates of certain tokens are out there in the chatrooms telling anyone who will listen that their coins will be the next ones to take off.

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Cryptopia Exchange, Currently in Liquidation, Gets Hacked Again: Report

5 years 7 months ago

The Cryptopia exchange has reportedly been hacked again, even as it is being liquidated following a previous breach that stole NZ$24 million (US$15.5 million).

  • According to a Stuff report Thursday, a creditor, U.S. firm Stakenet, has been told that about NZ$62,000 (US$45,000) in the XSN cryptocurrency had been transferred out of its cold wallet on Feb. 1.
  • Unused since the first Cryptopia hack in January 2019, the wallet is reported to contain crypto assets worth NZ$2.7 million (US$1.97 million) in total.
  • Liquidator Grant Thornton New Zealand said it hadn’t authorized the movement of funds and that it is investigating the incident, according to an email seen by Stuff.
  • Stakenet had not lost funds in the 2019 hack and had been hoping to eventually receive all its assets back.
  • “If this unauthorised transaction has happened under Grant Thornton’s watch then they need to explain to the users why they failed to secure … [the] assets like they were supposed to do and how someone was able to access them,” the company told Stuff.
  • The news comes soon after Grant Thornton had finally started allowing former users of the exchange to enter claims to retrieve their assets.

See also: Cryptopia Users Can Claim Assets From End of 2020, Says Hacked Exchange’s Liquidator

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Ether Sets New All-Time High Over $2,000 as Bull Run Continues

5 years 7 months ago

Ether has surged past $2,000 as the native cryptocurrency of the Ethereum blockchain continues its year-long bull run.

According to the CoinDesk 20,ether hit a new record of $2,033.08, up 6.18% in the last 24 hours, with the market capitalization of the crypto reaching $233.3 billion. The cryptocurrency is up 172.5% year-to-date.

While ether hitting $2,000 would normally be a stop-the-presses-type event, it almost certainly will be overshadowed by the numerous milestones reached hours before by larger sibling bitcoin including hitting a $1 trillion market value for the first time and rising almost $5,000 in a 24-hour period.

Related: YouTube Star Jake Paul Reportedly “Discussed” Creating His Own Crypto: Good or Bad Idea?

But ether’s rise and surging popularity should not be overlooked. At least three growing areas of demand are fueling the increase in ether’s price: decentralized finance (DeFi), Ethereum 2.0 staking and a newly formed institutionally focused ether market on the Chicago Mercantile Exchange (CME). 

Often compared to oil, ether powers interactions on the Ethereum blockchain which is best known for hosting a variety of DeFi apps such as lending, trading and prediction markets. Ethereum-based applications create a natural utility for ether as the cryptocurrency is required to settle transactions. DeFi coins have followed lockstep with ether as shown by the DeFi Pulse Index (DPI), up 83% in the last 30 days, according to Index Coop.

Staking on the Ethereum 2.0 network is also creating a supply shock of supports for the digital asset. Eth 2.0 is an in-progress redesign of the Ethereum network based on a new consensus mechanism called proof-of-stake (PoS) and database sharding. Some 2.7% of ether worth $6 billion has been deposited on the Eth 2.0 blockchain. Those funds are further locked for roughly the next 12 months.

Lastly, large investors such as investment funds may be interested in gaining some exposure to the cryptocurrency. CME launched cash-settled futures contracts for the digital asset on Feb. 8. The contracts surpassed $160 billion in aggregated volume within the first week. As the CME is one of the oldest and most trusted exchanges in the U.S., the contract launch there may signal growing institutional acceptance for ether.

Related: Investment Giant BlackRock Has “Started to Dabble” in Bitcoin

Read more: Valid Points: How CME Ether Futures Work and Why They Matter

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Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

5 years 7 months ago

An age-old question of how to monetize memes appears to have found an answer. This afternoon, the storied internet sensation, Nyan Cat, sold for 300.00 ETH (about $590,000) in an online auction. It wasn’t the .gif file that was sold, which is still reproducible and found everywhere online, but a cryptographic hash of the psychedelic image on the Ethereum blockchain. 

Chris Torres, who created the meme 10 years ago, confirmed the sale and his role in it over email. This was his first experiment with nonfungible tokens (NFTs), a type of digital asset that has taken the crypto scene by storm recently. NFTs, like Bitcoin, are provably scarce and uniquely identifiable. They’ve found application in the world of digital art, as well as more earth-bound industries. 

“I am still relatively new to crypto in general, but I see its full potential,” Torres said. The sale took place on the crypto art platform Foundation, which launched just two weeks ago. The auction was open for 24 hours, with bids starting at 3 ETH.

Related: YouTube Star Jake Paul Reportedly “Discussed” Creating His Own Crypto: Good or Bad Idea?

In recent weeks, a number of historical NFTs have sold for hundreds of ETH, like one Crypto Punk variant priced at over $1 million. The NFT-based art market, which has surged with the crypto markets, is now worth over $100 million, with success seen by crypto-native and traditional artists alike. 

Torres’ sale represents the latest permutation of the NFT industry: codifying and selling bits of the web that seemingly belong to everyone. “I’m very surprised with the success, but I think I’m most glad knowing that I’ve basically opened the door to a whole new meme economy in the crypto world,” Torres said. 

Until now, the creators of memes would often see little recompense for their work. Some scored book deals, others sold t-shirts and merchandise. But there was little reliable way to monetize the idea. 

With crypto, any idea can be monetized directly. And so long as the creator’s identity can reliably be tied to the work, it presents the most direct way to reward someone for things others enjoy. Plus, the works can be resold on a secondary market, with proceeds continuing to accrue to the artist. 

Related: Investment Giant BlackRock Has “Started to Dabble” in Bitcoin

“I feel like that’s what it really needed, and it’s going to be great seeing how it plays out,” Torres said. 

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Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

5 years 7 months ago

Bitcoin broke briefly above a key resistance level at $56,000 on Friday, while ether’s slowly catching up to bitcoin’s gains.

  • Bitcoin (BTC) trading around $55,512.76 as of 22:00 UTC (5 p.m. ET). Gaining 6.60% over the previous 24 hours.
  • Bitcoin’s 24-hour range: $50,821.47-$56,283.55 (CoinDesk 20)
  • BTC trades above its 10-hour and 50-hour averages on the hourly chart, a bullish signal for market technicians.

Some are attributing the astonishing rise of bitcoin’s price, including a short time above $56,000, to the tremendous demand from buyers looking to hedge against inflation.

“Through the insatiable buy-side pressure from exchange-traded fund (ETF) issuers, closed-end funds and large public corporations adding bitcoin to their positions, demand is massively outstripping supply,” said John Willock, chief executive at digital asset exchange Blocktane. “I feel confident that we won’t see a massive crash like post-2017.”

Related: YouTube Star Jake Paul Reportedly “Discussed” Creating His Own Crypto: Good or Bad Idea?

The first publicly traded bitcoin ETF in North America, managed by Canada-based Purpose Investments, saw an impressive $165 million worth trading volume on its first day of trading, well above a typical Day One for a Canadian ETF. (TradeBlock, a CoinDesk subsidiary, is the index provider of Purpose Investments’ bitcoin ETF.)

Read More: North America’s First Bitcoin ETF Hits $165M Trade Volume in First Day

Yet, there are still several psychological barriers for bitcoin to break, even as it passed a key milestone of $1 trillion in market capitalization. 

While the 10-figure market cap potentially makes bitcoin go from “a magic internet money meme” into a largely recognized investment asset, it also poses some psychological challenges to some buyers, who may sell some bitcoin for profit taking.

Related: Investment Giant BlackRock Has “Started to Dabble” in Bitcoin

Read More: Bitcoin’s Price Surge Accelerates After Passing Milestone of $1T Market Value

In the derivatives market, bitcoin’s price could be tested at around $56,000, according to Andrew Tu, an executive at quantitative trading firm Efficient Frontier.

“Based on options open interest, it looks like $56,000 is the next big resistance,” Tu said.

Some are taking it a step further. Michael Burry, “The Big Short” investor and founder of the Scion Asset Management, said in a now deleted tweet, “In an inflationary crisis, governments will move to squash competitors in the currency arena,” adding “$BTC #gold” to the end of the tweet.

However, while many bought into bitcoin’s “digital gold” narrative at the beginning of the coronavirus pandemic, physical gold has lost value year to date while bitcoin has skyrocketed.

Ether near $2K, DeFi drives Binance’s BNB

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Friday, trading around $1,951.37 and climbing 0.63% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

With ether’s new all-time high could be seen as a result of bitcoin’s surge, factors such as institutional interest and rapid growth of decentralized finance (DeFi) have also been moving its price higher.

But much of the chatter in the altcoin market is centered on BNB, the native token to Binance, the No. 1 cryptocurrency exchange by spot trading volume. BNB saw a seven-fold return on a year-to-day basis and its market capitalization has passed that of the stablecoin tether (USDT) to take third place behind bitcoin and ether.

Read More: BNB Gains 45% in 24 Hours as PancakeSwap ‘Flippens’ Uniswap Volume

BNB’s explosion is likely a result of an extraordinary growth in PancakeSwap, a DeFi project based on Binance’s Binance Smart Chain. Trading volumes on the Ethereum-based Uniswap’s clone have grown over 1,000% for the year to date, and its own CAKE token has shot up by over 2,000% year to day, according to Messari.

Read More: PancakeSwap Brings Whopping DeFi Volumes to Binance Smart Chain

CoinDesk previously reported that investors have bought centralized exchange tokens like BNB hoping to outperform bitcoin while acting more like equity. However, the risks are also obvious: unlike stocks, exchange tokens are unregulated. Thus, as they take on more equity-like behavior, the regulatory uncertainty only grows.

Read More: Exchange Tokens Are Skyrocketing as They Act More Like Equity; That Could Be a Problem

Other markets

Digital assets on the CoinDesk 20 are mixed on Friday. Notable winners as of 21:00 UTC (4:00 p.m. ET): 

Notable losers:

Equities:

Commodities:

  • Oil was down 2.56%. Price per barrel of West Texas Intermediate crude: $58.97.
  • Gold was in the green 0.34% and at $1781.33 as of press time.

Treasurys:

  • The 10-year U.S. Treasury bond yield climbed Friday jumping to 1.34%.
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Ideamarket Is a Literal Marketplace for Ideas (and Online Reputation)

5 years 7 months ago

With Facebook cutting news from its platform for Australians and most Americans having lost trust in media, the search for reliable information has sent many down the halls of Reddit, YouTube and other social media platforms. 

Credibility is hard to find. But one Los Angeles-based startup is providing what it argues are objective rankings of information distributors. Built on Ethereum, Ideamarket launched this week and lets users put their money behind social media accounts they deem important. 

In essence, it’s a manifestation of the generally amorphous “marketplace of ideas.”

Related: YouTube Star Jake Paul Reportedly “Discussed” Creating His Own Crypto: Good or Bad Idea?

“Ideamarket is an entirely new income stream for creators, without dependence on ads or paywalls,” said founder Mike Elias. “Our goal is to liberate journalism from paywalls by giving [journalists and creators] an income stream dependent only on the trust they earn from their audience. This rewards journalists for publishing their best work for free, without paywalls.”

It’s not just journalists, though. Some of the top-ranking accounts on the site include Elon Musk comfortably at #1 for Twitter accounts, with Soulja Boy coming in at #8. In between those two, at #5, is the @potus account of President Joe Biden. 

Thus far, Ideamarket has attracted over $1 million in deposits to the site. 

How Ideamarket works

Ideamarket functions somewhat similarly to Reddit, in which people can upvote various media brands, journalists and, really, any post that they think has online credibility. But instead of having no cost, like an upvote, Ideamarket lets users buy tokens (think of it like stock) in a social media account they deem valuable and reputable. 

Related: Investment Giant BlackRock Has “Started to Dabble” in Bitcoin

As described in a previous article, upvotes “cost money and increase in cost as vote count increases, meaning that people have to put their money where their mouth, or itchy retweeting trigger finger, is.”

So, say you wanted to add Twitter account @johndoe to Ideamarket and buy tokens in that account. First you would have to go to the site and click on the button to “Add Listing.” You could then add that account. 

Ideamarket encourages people, when listing an account, to buy tokens in it when they do. This is because the first 1,000 tokens for each listing cost $0.10 each but then automatically increase by $0.01 after every 100 tokens bought henceforth. These increases are managed by a bonding curve algorithm.

To buy or sell a token, you click on the trade button. 

You then choose to pay with crypto or a credit card. For a credit card, there would be instructions to create a Portis crypto wallet. Then, use the dropdown menu to choose what currency to pay in. If you’re paying with a credit card, DAI is recommended. You then enter the amount you want to purchase and click buy. So after adding @johndoe, for example, you could pay $1 for ten tokens of @johndoe. 

According to a document overview of the site, “money spent on tokens is held in Compound.Finance, a decentralized lending protocol. Compound lends these deposits to borrowers, who pay interest (usually 1%-10% annually).”

All interest generated by token deposits is paid to the owner of the associated social media account, and anyone can add an account to the platform. 

Essentially, you buy tokens in accounts you think are “attention-worthy” or have a reputation you’d like to support. You can later sell these tokens down the line if you choose. You can also lock your tokens for a certain amount of time, signaling long-term confidence in the account and that you won’t just sell as soon as other people purchase. As the price of the token rises you can sell at a profit if you choose, and the account earns interest which can be collected by its owner. 

It’s not just the content creators who get paid; platforms get a new income stream as well.  

For each transaction, there is a 1% fee, half of which goes to the platform and half of which goes to Ideamarket.

Currently, the platforms listed on Ideamarket are Twitter and Substack. Twitter currently has accrued over $6,000 that it has yet to claim, while Substack has not yet breached $75 at the time of writing. 

New developments since the beta

There are two big differences from the beta of Ideamarket that was launched in November 2019. Originally, said Elias, it was going to rank web domains, like http://wsj.com and http://cnn.com “Now, we’re ranking social media accounts, like @balajis and @joerogan,” he said.

All interest generated by deposits on tokens gets paid to the account owners. 

“We see ourselves as ‘Chainlink for public narratives.’ We’re not dependent on any particular social media platform,” said Elias. “Instead, we’re available for any public square that develops to plug into.”

According to Elias, Ideamarket’s main goal is to relieve social media platforms of the “impossible task of making epistemic judgments on behalf of the public.” He said Ideamarket is a protocol for risk-backed content moderation, and that by measuring credibility in dollars, “fake news” becomes permanently and increasingly more expensive.

“Now, in addition to creating a newsy-looking website, they have to buy a market rank similar to the trusted publications they’re trying to imitate,” he said. 

While Ideamarket is listing social media accounts on various platforms, news organizations’ accounts like those of the New York Times or Fox News could also be added if users decided to do so. 

Like any existing market, Elias concedes, there’s no way to explicitly prevent private interests from artificially boosting a listing and in theory their online credibility. For example, I could list myself and then pay to boost my own ranking. 

“However, parties that buy a high rank are paying out of pocket for something trusted voices crowdsource ‘for free,’” said Elias. “They’re also competing against the buying power of entire populations. Ideamarket is a new income stream for trusted voices, and a constantly growing expense for propagandists.”

Gas fees a hurdle

Like all things Ethereum right now, high gas fees are the biggest challenge Ideamarket is facing. Given the Ethereum-wide demand, gas fees are often over $100 per transaction. 

Ideamarket CTO Alexander Schlindwein is now working on a plan, which originally came from Ideamarket investor Felix Hartmann. If it works, Schlindwein’s plan will reduce gas fees for buys denominated in DAI by about 40%.

“We’re also entertaining creative solutions, such as decentralized index funds from Enzyme Finance,” said Elias. “This would allow influencers to create Ideamarket indexes and crowdsource funds from small investors, who would then gain exposure to multiple Ideamarket tokens while only sending one transaction (to buy into the index fund).”

The staying power for the platform will depend upon, yes, gas fees, as well as overall interest and buy-in, to ensure the rankings can’t be swayed by a small group of individuals, for example. But it’s one more tool for consumers to navigate the fractured and insular online world of information, and for content providers to make some money along the way. 

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The Rising Tide of Digital Currencies

5 years 7 months ago
The pandemic accelerated the shift away from the physical world and into the digital world, and that digital world is rather poorly served by traditional payment systems like cash and checks, opening the door for digital payment solutions and digital currency alternatives
Chris Versace

Bitcoin Brokerage River Financial Raises $17M: SEC Filings

5 years 7 months ago

High-end bitcoin brokerage River Financial raised $17.3 million in a recent equity sale, according to documents filed with the U.S. Securities and Exchange Commission (SEC) Thursday.

Form D filings reveal two-year-old River aims to raise nearly $500,000 in additional funding for a total of nearly $17.8 million. The firm reported 34 backers in its latest filing but none of them were known at press time.

It was not immediately clear if the $17 million figure includes funds from the $5.7 million seed round River completed last July with backing from Castle Island Ventures, Slow Ventures and a slew of other VCs. Partners at those firms did not respond to multiple CoinDesk inquiries.

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

CEO Alexander Leishman acknowledged in a brief phone interview Thursday the brokerage was considering pursuing additional funding. He confirmed in a Friday follow-up that River’s counsel had submitted documents to the SEC but declined to elaborate on the round. 

The SEC requires private companies notify the regulator of equity sales within 15 business days of the first sale in a round. The documents filed Thursday with the SEC state River Financial completed its first sale of the round on Jan. 28, 2021.

Hiring push

River’s equity filing comes as the bitcoin-only brokerage embarks on a massive hiring push across compliance, client acquisition and engineering, with at least seven positions open for a team currently only 16 strong, according to the website.

Software job postings indicate River intends to build new services for its iOS app, and is considering taking steps to bolster account security and develop “novel performance reporting features,” projects it offers as examples to prospective hires. 

Related: Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

River serves deep-pocketed bitcoin investors and has in the past insisted it manages a “brokerage” service, not an exchange. It is seeking to refine that white-glove offering already available 32 U.S. states, as evidenced by the client operations analyst position. 

Read the filing:

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Bitcoin Is Worth $1T and OKCoin Delists BCH and BSV

5 years 8 months ago

This article is excerpted from Blockchain Bites, a daily roundup of the most pivotal stories in blockchain and crypto news. You can subscribe to get the full newsletter here.

$1T
Bitcoin is a trillion-dollar asset. The first and largest cryptocurrency set a new high of $53,739.48 Friday morning, the magic number at which the market value of all bitcoins in circulation is worth $1 trillion. This is up from a $178 billion market capitalization last year, CoinDesk’s Zack Voell reports.

While in some sense a meaningless event, it is also a serious milestone on the path for bitcoin to become a significant part of the global financial ecosystem. The open protocol is now more valuable than Facebook, and could soon overtake Alphabet, Google’s parent, or Amazon if prices continue to rise.

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

In February 2011, just two years and one month after the Bitcoin “genesis block” was mined, the cryptocurrency hit dollar parity, or the moment when one BTC could be exchanged for $1. This was an important psychological event, proving that bitcoin wasn’t just a usable currency, but a viable, alternative monetary system.

“[I]t’s like going from kids playing an early version of a game on the street with sticks and rocks, to 10 years later it being the fastest-growing, most important, most impactful game that’s taking over the sports world,” CoinDesk podcast editor Adam B. Levine, an early adopter, told Blockchain Bites.

“Initial viability is important. Mainstream acceptance is important,” he said. Institutions are rapidly entering the bitcoin economy at a moment when the U.S. dollar’s longevity has never been more in question.

Indeed, the trillion dollar sign post may signal a future where a dollar price quote for bitcoin hardly matters. It’s unlikely the entire global economy is denominated in satoshis – even less so in “bits” – but bitcoin could become a viable global reserve asset. Not just sitting on disruptors like MicroStrategy or Tesla’s balance sheets, some predict a world where governments hold.

Related: Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

As Michael Venuto of Toroso Asset Management said this morning on CoinDesk TV, “[Bitcoin’s] price is more or less a meme. It gets people excited but perhaps for the wrong reasons, preventing them from going down the rabbit hole.”

Other stories

CeFi and DeFi paddycakes
PancakeSwap is the latest automated market maker (AMM) clone looking to unseat Uniswap as the top DeFi trading platform. The protocol is developed by Binance and offers reprieve to soaring gas prices on the Ethereum-based original. Liquidity, volumes and the price of its native CAKE token are skyrocketing, perhaps to the ire of stone-cold Ethereum stans.

This exchange ain’t big enough …
OKCoin is delisting bitcoin cash (BCH) and bitcoin SV (BSV) to prevent new customers from confusing these two forks for bitcoin (BTC). “This is not an easy decision. We had a choice and there is collateral damage, but we had to stand up for the bigger principle we believe in,” OKCoin CEO Hong Fang told CoinDesk. Bitcoin Cash is a clone of Bitcoin, with minor adjustments to increase block sizes. BSV, championed by Craig Wright, known for his claims to be the inventor of the original Bitcoin, is itself a fork of Bitcoin Cash. CoinDesk tech reporter Colin Harper dives in.

Systemically important: bank says
Bitcoin, and the wider crypto market, could face a severe liquidity shock if traders lost faith in tether (USDT), according to JPMorgan analysts. In a new report, bank analyst played catch-up to the interminable tether conversation, saying the dollar-equivalent stablecoin’s implosure could trigger a bank run-like event. There are more than $33 billion USDT in existence, up from $4 billion just 12 months ago.

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CoinDesk

Austrian Regulator Reports Rise in Crypto Fraud

5 years 8 months ago

Austria’s Financial Market Authority (FMA) said Friday there has been an increase in crime using cryptocurrencies and stricter regulation is needed. 

  • The FMA reports two-thirds of the investment fraud reports filed in 2020 were related to cryptocurrency and digital currency trading products, according to a Bloomberg report.
  • “We see a great need for stricter regulation,” FMA spokesman Klaus Grubelnik told Bloomberg. “Fake offerings for stocks and gold have been around forever and these scams are now shifting to digital assets because of the hype.”
  • There has been an increasing number of scams using digital currencies advertised on social media platforms such as Facebook, WhatsApp, TikTok, and Telegram, warned the FMA.
  • Grubelnik said prosecution was even more difficult in such cases as investigations usually have to be conducted across borders.

Read more: Leading Austrian Telecom Provider Adds Cryptocurrencies to Its Cashless Payment Network

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Bitcoin’s Price Surge Accelerates After Passing Milestone of $1T Market Value

5 years 8 months ago

Bitcoin’s recent price surge pushed the largest cryptocurrency past $1 trillion in market capitalization, a threshold that might prove to be a catalyst for higher prices rather than a barrier or peak. 

At press time, bitcoin was trading at $54,646.46, up 5.30% in the past 24 hours. It is only slightly down from the new all-time high at $54,711.32

“In many ways, $1 trillion marks an interesting focal point in which bitcoin goes from a magic internet money meme into a Wall Street, institutionally recognized and investable asset,” said Andrew Tu, an executive at quantitative trading firm Efficient Frontier.

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

At the same time, bitcoin’s one-month implied volatility – investors’ expectation of how turbulent prices will be over the next four weeks – also dropped on Friday, according to data source Skew.

“The bulls have taken hold of the markets,” said Denis Vinokourov, head of research at digital assets prime broker Bequant.

Many factors in the past week have contributed to bitcoin’s latest rally, including U.S. Treasury Secretary Janet Yellen pushing the Biden Administration’s proposal of $1.9 trillion stimulus package, MicroStrategy’s announcement it is boosting its bitcoin stash again and money manager BlackRock’s “dabbling” in cryptocurrency.

While every piece of news seems to benefit bitcoin and cryptocurrency as a whole, some are warning about potential risks of people taking profits and pushing down bitcoin’s price.

Related: Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

“With traders appearing to now expect announcements like these to keep coming, we may see a pullback in the near future, perhaps this weekend,” Guy Hirsch, U.S. managing director at eToro, said. “It would not be surprising to see bitcoin drop briefly below $50,000 while some people and firms lock in profits before another run above this all-important psychological level.”

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Ethereum Core Developers Eye Mid-April for ‘Berlin’ Hard Fork

5 years 8 months ago

Ethereum developers have scheduled the Berlin hard fork for April 14 at block height 12,244,000, according to the Ethereum All Core Developers meeting Friday.

The hardfork includes various optimizations for contracts including gas efficiencies, updates to how code is read by the Ethereum Virtual Machine (EVM) and other changes to protect against denial-of-service (DDOS) attacks.

The Berlin hard fork was originally scheduled for June or July 2020, but was pushed back mainly due to centralization concerns around the Geth client on which most Ethereum nodes run. Moreover, developers working on the current base layer blockchain, often called Eth 1.x, have expressed strain from maintaining the client. 

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

Read more: Ethereum Developers Delay Berlin Hard Fork to Stem Client Centralization Concerns

The Berlin hard fork has been preceded by multiple testnets. The update, which includes at least five Ethereum Improvement Proposals (EIP), will be shipped on four test networks before deployment as well.

Correction (Feb. 19, 17:45 UTC): A previous version of this article stated Berlin included an EIP necessary for the Ethereum 2.0 merge. However, that EIP is not currently slated for inclusion.

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MicroStrategy Raises $1.05B in Latest Debt-for-Bitcoin Offering

5 years 8 months ago

MicroStrategy CEO Michael Saylor said Friday the firm had completed a $1.05 billion debt offering, a raise that will allow the business intelligence company to buy another $1 billion in bitcoin.

The raise is part of MicroStrategy’s dual business strategy of developing business intelligence software and also literally just buying as much bitcoin as it possibly can. MicroStrategy already has 71,039 of the coins.

“MicroStrategy estimates that the net proceeds from the sale of the notes will be approximately $1.03 billion, after deducting the initial purchasers’ discounts and commissions and estimated offering expenses payable by MicroStrategy,” the company said.

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Bitcoin Market Value Tops $1T as Price Passes $53,697

5 years 8 months ago

Bitcoin’s total market value passed $1 trillion for the first time Friday as the leading cryptocurrency traded at new record highs above $53,697.65, per the CoinDesk Bitcoin Price Index.

  • The price of bitcoin rose to a new all-time high of $53,739.48 Friday morning as its total value past the 13-digit landmark, up roughly 3.6% in the last 24 hours.
  • Bitcoin has gained nearly 80% year to date, and the bullish market cycle isn’t showing signs of peaking.
  • “Sure there are speculative excesses, like in all bull markets,” Bloomberg senior commodity strategist Mike McGlone told CoinDesk in an email. “But the bitcoin tide is rising on the back of it becoming a global digital reserve asset.”
  • The trillion-dollar market value comes after a flurry of new institutional investor interest from public companies like Tesla buying $1.5 billion in bitcoin, leading financial institutions like Deutsche Bank and BNY Mellon announcing crypto custody offerings, and bitcoin-laden business intelligence company MicroStrategy flush with $1.05 billion in fresh cash to buy even more of the cryptocurrency, per CoinDesk’s prior reporting.
  • Bitcoin had a market value of $178 billion a year ago, according to TradingView data.
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First Mover: Bitcoin Meets ‘Torrent’ as Lowly Binance Coin Gets $40B Valuation

5 years 8 months ago
Price Point

Bitcoin (BTC) pushed higher on Friday to a new all-time-high price, stopping just shy of $53,000. At the current level of outstanding bitcoin supplies, a move above $53,665 would push the largest cryptocurrency’s market capitalization to the $1 trillion mark, seen as a milestone in bitcoin’s maturation as a global asset. 

Signs continued to mount that bitcoin is seeing increased mainstream adoption – or at least mainstream attention from the likes of the giant bank JPMorgan Chase, U.S. Treasury Secretary Janet Yellen, Microsoft founder Bill Gates and the bond-investing legend Jeff Gundlach. (See Bitcoin Watch, below.)   

But bitcoin perhaps wasn’t even be the biggest story this week in digital-asset markets. Binance coin (BNB), the in-house in-house token from the similarly named cryptocurrency exchange, has soared this month to a $40 billion market capitalization, ranking it third among all digital assets behind bitcoin and Ethereum’s ether (ETH). 

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

In traditional markets, European shares rose and U.S. stock futures pointed to a higher open. Gold slid 0.2% to $1,772 an ounce. 

The News

PAY YOUR SWISS TAXES IN BTC: The Swiss canton of Zug – dubbed “Crypto Valley” thanks to the many digital-asset companies drawn to the jurisdiction because of its friendly blockchain and crypto regulation – has started accepting tax payments in cryptocurrency. For now, there’s a cap of 100,000 Swiss francs ($111,300). “As the home of the Crypto Valley, it is important to us to further promote and simplify the use of cryptocurrencies in everyday life,” said Zug’s finance director, Heinz Tannler, when the tax initiative was announced.

BIDDERS UP: Christie’s, the 255-year-old auction house of art, antiques and apparently meterorites, will now accept cryptocurrency for payment, Bloomberg reported. “That Christie’s is willing to accept cryptocurrency for the first time,” according to the piece, “says more about the auction house’s attempt to break into new audiences than it does about a shift in the traditional art market.”

Bitcoin Watch

Bitcoin beating gold where it counts right now – on the inflation trade

Related: Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

Bitcoin continues to outshine gold amid calls for more fiscal spending to boost the U.S. economy back to full strength.

The world’s biggest cryptocurrency set a new record price of $52,954.49 on Friday, CoinDesk’s Omkar Godbole reported, having scaled the $50,000 mark two days prior. Meanwhile, gold fell to $1,760 early Friday to hit the lowest level since July.

Bitcoin’s potential use as a hedge against inflation, and possibly a better one than gold, has become a key narrative on Wall Street as well as in Washington. 

In an interview with CNBC on Thursday, U.S. Treasury Secretary Janet Yellen said that the proposed $1.9 trillion stimulus package could help the U.S. get back to full employment in a year, a sign that President Joe Biden’s administration is undaunted in pushing for a large bill. She added that the risk associated with delivering too little stimulus is greater than the price of doing something big.

But she added that bitcoin is a “highly speculative asset.” 

Jeffrey Gundlach, CEO of the $130 billion DoubleLine Capital and one of the world’s most renowned bond investors, tweeted Thursday that he was a “long-term dollar bear” and that bitcoin was “maybe the Stimulus Asset” and that it “doesn’t look like gold is.” Gundlach previously had said he didn’t believe in bitcoin.

“Lots of liquid poured into a funnel creates a torrent,” Gundlach wrote in the tweet. 

Analysts for JPMorgan wrote in an 86-page report that bitcoin’s “competition with gold as an ‘alternative’ currency is here to stay,” though they called it an “economic sideshow” in that “the rise of digital finance is the real post-Covid-19 story.” 

Bill Gates, the Microsoft-founder-turned-philanthropist, said he’s neutral, notable perhaps because he didn’t immediately pan it, as some other successful U.S. business people have done, later to miss out on big market gains. (Looking at you, Warren Buffett.)  

“The past couple of weeks have seen fundamental arguments made for choosing silver, bitcoin, and Treasuries over gold,” wrote Edward Moya, senior market analyst for the foreign-exchange broker OANDA. “Bitcoin has benefited from relentless retail demand and on expectations that institutional interest is still growing.”

Market Moves

Binance coin shoots to $40B valuation, trailing only bitcoin and ether

While cryptocurrency exchange Coinbase’s valuation soars to a $77 billion valuation based on private-share trading, rival Binance is seeing rocketing demand for its exchange tokens in digital-asset markets.

Prices for the BNB tokens have jumped five-fold this month, for a market value of about $40 billion. According to Messari, that valuation makes Binance coin the third-biggest digital asset after bitcoin and Ethereum’s ether.

The token serves as Binance’s internal currency: It can be used to buy cryptocurrencies on the exchange and pay fees. So the jump in BNB’s price might reflect speculation that Binance, already one of the world’s biggest cryptocurrency exchanges by trading volume, will occupy a dominant role in the future of fast-growing digital-asset markets.  

According to CoinDesk’s Sebastian Sinclair, the price rise might be tied to increased interest in a decentralized financial application called PancakeSwap, which helps users find yield-earning opportunities in crypto markets. PancakeSwap runs on Binance’s own blockchain, Binance Smart Chain. 

Daily volumes on PancakeSwap have shot up to more than $1 billion, from $37 million at the start of the year, CoinDesk’s Will Foxley reported.

The BNB token is needed to process transactions on the Binance Smart Chain, similar to the way ether is used on the Ethereum blockchain.

For what it’s worth, the BNB token itself is set atop the Ethereum blockchain, under the common ERC-20 standard for digital tokens. 

That helps explain why a tokenized or “synthetic” version of the BNB token, called wrapped BNB (WBNB), appears to be the primary token traded on PancakeSwap within the Binance Smart Chain ecosystem, according to CoinGecko, a crypto-markets tracking site:

Opinions and Observations

DEFI AT $400 BILLION? Bloq founder Matthew Roszak told CoinDesk TV  that the growing arena of decentralized finance, or DeFi, where total collateral now sits at $40 billion, could “add another zero in a year from today.”

TULIPMANIA 2.0? “While bubbles of the past explode only to later collapse and never to return to their previous glory, bitcoin is known for its “two-steps-forward-one-step-back” moves,” Joakim Book, a research fellow at the American Institute for Economic Research, writes in op-ed for CoinDesk Opinion.

WHAT IS A BITCOIN ETF, AND WHY DOES IT MATTER? CoinDesk’s Ollie Leach explains. 

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OKCoin Delists Bitcoin Cash, Bitcoin SV to Avoid ‘Misleading’ New Bitcoin Clients

5 years 8 months ago

OKCoin is delisting bitcoin cash (BCH), a fork or “clone” of bitcoin, as well as its own fork, bitcoin sv (BSV), both as a way to protect neophyte clients who are trying to buy bitcoin and as a statement of principle.

Shared exclusively with CoinDesk before Friday’s announcement, the exchange’s higher-ups decided to scuttle the markets for either coin because they created confusion for new clients who joined OKCoin to buy bitcoin.

On top of that, the routine lawsuits and legal threats from Bitcoin SV creator Craig Wright played a hand in the exchange decision to delist both BCH and BSV.

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

“This is not an easy decision. We had a choice and there is collateral damage, but we had to stand up for the bigger principle we believe in,” OKCoin CEO Hong Fang told CoinDesk, adding that OKCoin’s team tries to not let their “opinions color their decision making.”

Still, Craig Wright’s most recent legal crusade against developers who host Bitcoin’s white paper was a breaking point. For Fang, it became a choice between protecting Bitcoin’s open source ethos or championing free-market fundamentals. 

In the end, community won out.

“On the one hand we feel very strongly about protecting the open-source ethos, but on the other, if we do something about it, that would conflict with our principle of being a neutral platform. We wouldn’t have changed that if it weren’t for Craig Wright posting these threats to the open-source dev community. We think these threats are very destructive to development and Bitcoin as a whole,” Fang told CoinDesk.

Related: Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

Additionally, these coins bear bitcoin’s name and that has “caused a lot of confusion about what is the real bitcoin among new entrants,” Fang expressed.

“When we have all three on the platform and we have new clients onboarding, most are coming [to buy] bitcoin as a store of value. But when they see BSV and BCH they get confused.”

Bitcoin Cash is a “fork” of Bitcoin, meaning it was created by copying and tweaking Bitcoin’s code, which was birthed out of the so-called scaling or block size wars.

In August 2017, after the SegWit2x block size increase failed to pass muster with the Bitcoin community, former Bitcoin evangelist Roger Ver forked Bitcoin to create Bitcoin Cash. Two years later in November of 2019, Craig Wright and others forked Bitcoin Cash to create Bitcoin SV, which had even larger blocks than its predecessor.

Bitcoin Cash and Bitcoin SV: A history of contention

The confusion Fang speaks to has long been a frustration of the Bitcoin community.

Bitcoin.com, for instance, is run by Bitcoin Cash promoter and progenitor Roger Ver, and for some time the website’s “Buy Bitcoin” button directed patrons to a page where they could instead buy bitcoin cash.

Bitcoin proponents see this chicanery as a sort of attack on Bitcoin. They also argue that Bitcoin SV poses a similar threat. 

As such, it became something of a symbolic gesture in 2019 to delist bitcoin sv. Plenty of popular exchanges like Kraken, Binance, ShapeShift and others made the move; many or all of those same exchanges, though, still list bitcoin cash.

In January, Australian exchange Independent Reserve delisted bitcoin sv, citing Wright’s copyright suit threats against those who host Bitcoin’s white paper. (Wright has long proclaimed yet failed to prove that he is Bitcoin’s creator, Satoshi Nakamoto.)

It’s Fang’s hope that, in light of Wright’s recent actions, more industry leaders will step up and denounce what has become a thorn in the side of the entire industry.

“We call for other members of the community to protect the spirit of free and open source development and decentralization,” she said. “Say no to bullying.”

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Even Skeptics May Need to Consider Crypto Exposure: WSJ’s Heard on the Street

5 years 8 months ago

Cryptocurrency may still be too speculative or volatile for many but it presents opportunities other than direct investment, according to The Wall Street Journal’s “Heard on the Street” column.

Cryptocurrency’s viability as an investment may not be in its value as an asset but in the way the financial world is evolving because of it, the influential column argues.

The 40% rise in PayPal’s share price since it introduced its crypto service is an example of how crypto can “move the needle” in the financial system and how investors can profit without actually gaining direct exposure, the column’s author, Telos Demos, argues.

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

Rather than buying cryptocurrency itself, investors may instead look to firms who facilitate the buying and selling of crypto. Coinbase’s $77 billion valuation ahead of its public may appear particularly enticing.

The column points to another example in the surging shares of Silvergate Capital, the price of which has risen more than 100% in 2021. Silvergate, which serves crypto firms as a core part of its business, enjoyed a huge increase in customer deposits in the second half of 2020, though analysts have questioned the extent to which this is sustainable in the longer term.

See also: PayPal Wants to Be a CBDC Distributor

However, even if the revenue from buying and selling crypto itself stays small, analysts are bullish about the long-term prospects of companies that can attract younger users and harness that loyalty with products and services across all areas of finance including banking and lending.

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A Sudden Loss of Faith in Tether Would Pose Risk to Bitcoin, JPMorgan Says

5 years 8 months ago

According to analysts at JPMorgan, the bitcoin market could face severe liquidity shock if traders were to lose faith in tether (USDT) – a stablecoin widely used to fund cryptocurrency purchases. 

“If any issues arise that could affect the willingness or ability of both domestic and foreign investors to use USDT, the most likely result would be a severe liquidity shock to the broader cryptocurrency market, which could be amplified by its disproportionate impact on HFT [high-frequency trading]-style market makers which dominate the flow,” analysts at JPMorgan mentioned in an 86-page report published Thursday. 

Tether’s value is linked to the U.S. dollar on a 1:1 basis, and the stablecoin is backed by reserves, including “traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by the Tether issuing company to third parties, which may include affiliated entities,” according to the company’s official website. 

Related: Nyan Cat NFT Sells for 300 ETH, Opening Door to the ‘Meme Economy’

USDT’s market capitalization has increased from $4 billion to over $33 billion in the past 12 months – a sign of its increasing use as a funding currency. According to data collected by asset manager NYDIG and cited by JPMorgan analysts, around 50%-60% of bitcoin traded for USDT since 2019. 

Hence, a sudden loss of confidence in tether could end up triggering the crypto version of a bank run, destabilizing exchanges and causing a panic drop in bitcoin’s price. A bank run occurs when many depositors withdraw their money at the same time over concerns of the bank’s solvency. 

While tether functions like a traditional bank, it’s worth noting that it is not subject to a strict supervisory and disclosure regime as conventional banks. According to the analysts, the company hasn’t produced an independent audit yet, and concerns regarding reserves and finances linger, posing a tail risk to the bitcoin market. 

Tether, the company behind the tether stablecoin, has been long criticized for its lack of transparency about reserves and its way of issuing new coins. So far, however, the crypto market hasn’t paid much heed to such concerns. 

Related: Market Wrap: Bitcoin Briefly Above $56K, Ether Follows BTC’s Rally

Part of that lack of heed may stem from the fact that during the price rally seen over the past 12 months, U.S. dollar-based trades have been, on average, larger than USDT-based trades, according to Kaiko Research. As such, the risk of a big price crash on the potential loss of confidence in tether appears low.

The JPMorgan analysts did say, however, that they believe bitcoin is here to stay as an alternative cryptocurrency.

“Bitcoin’s competition with gold as an “alternative currency” will likely continue as millennials become a more important component of investors’ universe and given their preference for ‘digital gold’ over traditional gold,” analysts said, adding that its long-term target of $146,000 is contingent on its high price volatility converging with gold’s volatility, which is a multi-year process.

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