CoinDesk Crypto

New York-based Signature Bank has been added to JPMorgan’s list of recommended products on Tuesday.  

• JPMorgan analyst Steven Alexopoulos added Signature Bank (SBNY)  to its “focus list,” saying the bank is “positioned to ride the crypto wave.”
• A focus list highlights recommended stocks published by the investment firm’s research department.
• Deposit five-times growth in 2020 to more than $10 billion has “caught investors by surprise and triggered many questions about the opportunity for growing this newer business.”
• Bank’s shares have had “very strong outperformance” year to date: Alexopoulos.
• “Overweight” rating maintained, with price target of $250 a share, versus $195 now.

Read more: Signature Bank Adds $2.5B in Non-Interest Bearing Deposits in Q4

• US Lawmakers Ask Justin Sun, DLive How They Moderates Extremist Content
• First Mover – Feb 11, 2021
• Cramer Says ‘Every’ Corporate Treasurer Should Be Thinking Bitcoin
• First Mover – Feb 10, 2021

Xend Finance, a Nigeria-based decentralized finance (DeFi) platform for credit unions and cooperatives, has secured new partners and funding as it prepares for its bid to bring high-interest savings opportunities to Africa.

Set to launch its mainnet in March, the firm announced Tuesday that it has partnered with software service provider TechFusion Africa and will make its services available to TechFusion’s 5,000 credit union members. Xend has also secured new investors led by NGC Ventures and Haskhey, bringing total investment in the company to date to $2 million. 

The Xend platform launch was announced in November 2020, alongside a $1.5 million strategic funding round. The platform is backed by Binance, Google Launchpad and others. 

Related: Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes

According to Xend CEO Aronu Ugochukwu, credit unions and cooperatives can deposit their funds on the platform, where they will be converted to stablecoins – cryptocurrencies backed by traditional assets like the U.S. dollar.  

“We’ve created a platform to enable cooperatives and credit unions to earn high yields through stablecoins,” Ugochukwu told CoinDesk.  

Credit unions both at the institutional and community levels will have access to the platform and, by saving credit union funds in stablecoins, these groups can earn higher interest, he said. 

“Traditionally, credit unions offer an interest rate of 1% annual percentage yield compared to the possible 15% available through Xend Finance,” said Marilyn Modupe Jiwalde, head of sales and marketing at TechFusion Africa. 

Related: Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’

The goal is to help protect the earnings of African citizens from local currency devaluations and unstable economies, Ugochukwu said, pointing to Nigeria, where people are using crypto as a hedge against inflation. A Bloomberg survey of investors and analysts concluded that Nigeria’s central bank may devalue the local currency, the naira, by as much as 10% in 2021. 

See also: Binance Labs–Backed ‘DeFi Credit Union’ Bringing Higher Yields to Savers in Nigeria

• Siam Bank Launches $50M Blockchain Fund
• Hashdex to Launch the Hashdex Nasdaq Crypto Index ETF

SCB 10X, Siam Commercial Bank’s venture capital arm, said it has launched a new $50 million fund to invest in blockchain, digital asset and decentralized finance (DeFi) startups.

• The fund will focus on global early and growth-stage companies that will shape the next generation of financial services and digital systems, the venture capital arm of Thailand’s oldest bank announced.
• The firm’s chief venture and investment officer, Mukaya Panich, said blockchain-enabled financial services have the potential to spur financial inclusion, enable open access, and encourage innovation
• SCB 10X has previously invested in Ripple and BlockFi, a cryptocurrency lending platform with $1.5 billion in crypto assets on its books. SCB 10X joined the Series C funding round in August 2020 along with Peter Thiel’s Valar Ventures and Winklevoss Capital.
• More recently, the venture capital firm invested in Alpha Finance, a DeFi platform developing an ecosystem focused on products that can interoperate across different blockchains.

See also: BlockFi Raises $50M From Universities, NBA Star, Others as Crypto Lending Soars

• Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes
• Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’
• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Hashdex to Launch the Hashdex Nasdaq Crypto Index ETF

Brazil-based asset manager Hashdex said it will launch the world’s first crypto exchange-traded fund (ETF) on Monday.

• Listed on the Bermuda Stock Exchange (BSX), the Hashdex Nasdaq Crypto Index ETF  will track the Nasdaq Crypto Index (NCI) developed by Nasdaq and Hasdex and will be available for trading by accredited non-U.S. investors.
• Brazilian investors can gain exposure through a family of feeder funds managed by Hashdex and via the country’s leading investment platforms.
• Maintained by Nasdaq’s calculation agent, CF Benchmarks, the NCI tracks the performance of a diverse basket of USD-traded digital assets such as bitcoin cash, chainlink and stellar lumens. Bitcoin has the highest weighting on the NCI with 78.61%, followed by ethereum’s 16.86%.
• “The product should also accelerate the entry of institutional investors in crypto, a trend that has gained incredible momentum in the past months,” Marcelo Sampaio, CEO of Hashdex said.
• “The Nasdaq Crypto Index represents another leap toward the institutionalization of crypto as investors look for broader exposure to the digital asset class,” Sui Chung, CEO of CF Benchmarks, told CoinDesk.

UPDATE (Feb. 9 14:06 UTC): Fixes weighting percentage of ethereum.

• Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes
• Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’
• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

Crypto market maker Apifiny is planning to go public by the end of 2021, the company announced Tuesday. 

Following in Coinbase and INX’s footsteps, San Francisco-based Apifiny plans use the funds raised through the listing to finance an aggressive expansion this year,  

“We think there’s more vertical ways to improve these products,” said Haohan Xu, CEO of Apifiny. “Like having better algorithms, faster connections, having more robust servers that can process more transactions per second.”

Related: Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes

The firm’s main two product lines include Apifiny Connect, which lets institutional traders access cryptocurrency exchanges around the globe, and ExOne Plus, a market-making platform for smaller exchanges that need liquidity. Apifiny says it uses its connections to exchanges around the globe to enable better price discovery, which it uses to hedge trader’s positions.

In the past few months, the firm has added Crypto.com, Huobi Global, OKEx, Kucoin, BitMax, HBTC and Blockchain.com to its list of exchange partners.

See also: Coinbase to Become Publicly Traded, Announces Proposed Direct Listing of Shares

• Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’
• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

Singapore-based digital asset investment firm Spartan Group announced a new $50 million venture fund Tuesday that it said will invest in emerging decentralized finance (DeFi) ecosystems.

• The fund has raised over $30 million in its first round, with a further $20 million expected in a subsequent round likely taking place in March or April.
• Spartan aims to fill the gap between the Western and Asian markets, focusing on go-to-market strategies to boost early stage investments in DeFi projects.
• The group manages over $200 million across its various funds at present and has previously invested in DeFi protocols including MakerDao, Kyber Network, Yearn and Synthetix, via its Global Blockchain Opportunities Fund.
• Recently, Spartan joined a $10 million Series B funding round in trading venue dYdX led by Three Arrows Capital and DeFinance Capital.
• Kelvin Koh, co-founder of Spartan Group and former partner at Goldman Sachs, said the aim is to “create significant disruptions to the existing financial system over the next 20 years” through DeFi and fintech.

See also: Big Guns Back $10M Investment in DeFi’s dYdX

• Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes
• Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’
• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

Ethereum’s ether cryptocurrency rallied to new lifetime highs early on Tuesday amid a continued drying up of sell-side liquidity in the market.

The second-largest cryptocurrency registered a record high of $1,824.59 during the European trading hours, surpassing the previous peak price of $1,761.35 hit on Feb. 5, according to CoinDesk 20 data.

The cryptocurrency is now trading lower at $1,764, representing a 5.5% gain on a 24-hour basis. Ether has more than doubled in value this year, outperforming bitcoin‘s 58% rise.

Related: Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes

The latest gains could be attributed to expectations that Chicago Mercantile Exchange’s (CME) regulated ether futures would boost institutional participation. The CME futures contracts went live on Monday.

The bullish sentiment may have received a boost from the recent GameStop saga and turmoil in legacy markets underscoring what some say is a need for more democratization of finance. Ethereum’s blockchain dominates the decentralized finance space.

Aside from the above factors, the cryptocurrency may have benefitted from low liquidity on exchanges. The number of coins held in exchange addresses fell to a 16-month low of 15,243,945 on Monday, according to data source Glassnode.

The exchange balance has been sliding since August, likely due to investors taking direct custody of their coins or moving them to DeFi protocols. The number has declined by 8% over the past 4.5 weeks alone.

Related: Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’

With prices at current levels, ether’s market capitalization is now over $200 billion.

Also read: Ethereum Futures Are Now Trading on CME

• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

Bitcoin’s bull run may be set to intensify as the market anticipates a pick up in corporate demand prodded on by Tesla’s major investment in the cryptocurrency.

“Prices can fly very high, I expect other heavyweights to follow suit,” trader and analyst Alex Kruger told CoinDesk over WhatsApp, referring to Tesla’s bitcoin purchases made earlier this year.

On Monday, the electric car maker disclosed its $1.5 billion investment in bitcoin and signaled openness to acquire more digital assets, kicking the bitcoin market into overdrive. Bitcoin saw a record single-day move in dollar terms on Monday, rising by over $8,000 to levels above $46,000 and roaring to fresh lifetime highs above $48,000 early today, CoinDesk 20 data shows.

Related: Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes

While several publicly listed companies such as MicroStrategy have adopted bitcoin as a treasury asset over recent months, Tesla’s move is notable given that it is the first Fortune 500 company to diversify cash holdings into the cryptocurrency.

“Although the actual amount isn’t large comparatively, the signaling effect and market reflexivity of projecting other global market-leading companies to do the same will have a positive spiral effect on prices,” Singapore-based QCP Capital said on its Telegram channel.

“Reflexivity” is a theory that a positive feedback loop between expectations and economic fundamentals can yield a substantial price rally. Tesla’s bitcoin buys may have validated the long-held bullish narrative that the cryptocurrency acts as a reserve asset. More buyers, therefore, could join the market, putting upward pressure on prices.

The market is now pricing in the likelihood that other corporates will copy Tesla and Microstrategy’s neo-treasury management strategy, according to John Kramer, trader at GSR. “Tides are continually shifting in crypto and what may be lurking close to port are sovereign funds becoming the next wave of institutions to adopt this corporate playbook,” Cramer said in a Telegram chat.

Related: Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’

Investor interest in call options (bullish bets) has now increased in a sign investors are positioning for a continued price rally.

“We are seeing high volume across the board in call options ranging from $56,000 to $72,000,” Matthew Dibb, co-founder and COO of Stack Funds, told CoinDesk. “If the options market is any indication of the enthusiasm across investors, we will be going a lot higher,” Dibb added.

Additionally, multiple 100-plus call option contracts have been bought at strikes of $44,000, $48,000, and $52,000, according to Swiss-based data analytics platform Laevitas.

The one-, three- and six-month put-call skews, which measure the cost of bearish puts relative to calls, are firmly entrenched in the negative territory, per data provider Skew. That shows call options are drawing higher demand than puts.

However, increased activity in call options ranging from $52,000 to $72,000 does not necessarily mean traders are anticipating a bull market peak around these levels. Besides, trying to predict a precise topside target is pointless, given that the cryptocurrency is in a multi-year bull market, according to Kruger.

At press time, bitcoin is trading mostly unchanged on the day near $46,500. The slight drop from highs looks to be a typical bull breather often seen following a strong rally.

The broader bias would remain bullish as long as the trendline rising from $10,000 is held intact.

The “Elon [Musk] rally” has established $42,500 as the new support, and prices could rise to $50,000 in coming weeks, according to Dibb.

The cryptocurrency may face some selling pressure if regulators express concerns regarding Tesla’s plans to adopt bitcoin as a payment means for its vehicles.

However, Kruger is not worried about a potential regulatory hurdle. “The real worry should be ‘do I have enough crypto exposure’ and not ‘will regulators crash the market.’ I’m not at all concerned at the moment,” Kruger told CoinDesk.

Also read: Apple Should Launch Own Crypto Exchange, RBC Analyst Says

• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

A 36-year-old Florida-based telco employee was charged Monday over a SIM swapping scam that stole one victim’s cryptocurrency.

Stephen Defiore, 36, received a one-count Bill of Information – a waiver of indictment and agreement to prosecution in court – with conspiracy to commit wire fraud, according to a U.S. Department of Justice press release.

Defiore is the second person charged in connection with a scheme that hit 19 victims in SIM swap attacks, and stole a “significant portion” of cryptocurrency held by a doctor in New Orleans.

Related: Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes

According to the report, Defiore worked as a sales representative between August 2017 and November 2018 for an unnamed phone company. Having access to the company’s customer accounts, he allegedly performed SIM swaps – reassigning a SIM card to another user – as part of a $500 per day arrangement with a co-conspirator.

For each SIM swap, which netted Defiore over $2,300 in total via 12 payments, co-conspirator Ricard Li sent him a customer’s cellphone number, a four-digit PIN and a new SIM-card number for the swap. Li was charged for his alleged involvement in June 2020.

A SIM swam hack occurs when an attacker gains access to a victim’s cellphone account, allowing incoming calls and text messages to be routed to a different device. The attacker is then able to change passwords on a victim’s various accounts including emails and cryptocurrency exchange and bank accounts via SMS verification.

If convicted of the charge, Defiore faces a maximum of five years in prison and a fine of up to $250,000, as well as up to three years of supervised release after imprisonment and a mandatory $100 special assessment per count.

Related: Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’

See also: Irish Man Gets 3 Years in Prison for Stealing $2.5M in Crypto Through SIM Hacks

• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

A Wisconsin woman has been charged for trying to solicit a murder over the dark web paid for with bitcoin.

According to a report from the Milwaukee Journal Sentinel on Monday, Kelly Harper, 37, used a dark web site to pay the administrator to have a man tracked down and then killed. Harper has admitted to authorities she paid in bitcoin for the planned crime.

Three journalists investigating a story into the site’s dealings discovered the Wisconsin woman had been in communication with the admin, according to the report.

Related: Matic Network Now ‘Polygon’ as Platform Targets Ethereum’s L2 Woes

Upon request, Harper allegedly presented a sum of $5,633.87 in bitcoin to the admin as proof she could afford the hit. The journalists also found similar evidence of a completed bitcoin transfer to another murder for hire website in October.

After the journalists had got in contact with local law enforcement, FBI agents raided Harper’s home where they discovered screenshots of the dark web site on her computer. Their actions came before the murder could be carried out.

Messages were also discovered on Dec. 3, in which Harper said “the target needs to be killed,” while providing details of the man’s appearance, details of his vehicle, his place of work and phone number.

The woman is currently in custody and faces a maximum of 10 years in federal prison if convicted.

Related: Crypto-Friendly Signature Bank Added to JPMorgan’s ‘Focus List’

See also: FBI Needs a Dark Web, Crypto Strategy, DOJ’s Inspector General Says

• Binance-Backed DeFi Credit Union Platform Secures Partners, Funding Before Launch
• Siam Bank Launches $50M Blockchain Fund

Blockfolio has apologized after racist posts were distributed over its cryptocurrency portfolio and news app.

Overnight, at least two messages purporting to be from major cryptocurrency platforms were posted containing racist terms of abuse via “Signals” – Blockfolio’s communications feed aimed to allow token projects to “connect and engage with their communities.”

In a tweet Tuesday morning, Blockfolio said it was “incredibly sorry about the offensive messages posted today.”

Related: U.S. Woman Charged Over Attempted Dark Web Murder-for-Hire Paid With Bitcoin

The firm said no funds were affected and the event did not affect any trading features. “We have revoked access to the compromised Signal submitter and removed the messages,” it said.

Sam Bankman-Fried, CEO of the FTX exchange that owns Blockfolio, tweeted that all the app’s trading accounts are being given $10 by way of an apology.

“No members of the Blockfolio team wanted this to happen,” he said. “But we are all responsible for our product and will be doing what we can to fix this. I’ll also be donating to the ACLU today, as will a number of other staff members.”

CoinDesk asked Blockfolio what specifically it plans to do to prevent such abuse of the Signals system in future, but did not immediately receive a reply.

Related: KeepChange Foils Bitcoin Theft but Loses User Data in Sunday Breach

Read more: Portfolio App Blockfolio Adds Crypto, Stock Trading to Capitalize on GameStop Drama

• BitMEX Introduces Data Storage Framework for FATF’s Travel Rule
• Investors Pump $250M Into Reddit Following Social Media Site’s Role in GameStop Mania

Bitcoin marketplace KeepChange says it has managed to limit the ramifications of a security breach on Sunday.

According to a blog post on Monday, the exchange said several bitcoin withdrawal requests had been initiated from customer accounts to an address belonging to the attackers. However, one of the platform’s control subsystems halted the requests, resulting in no bitcoin being lost, the exchange said.

The attackers did, though, manage to steal some customer data including email addresses, names, trade counts, total traded amount and hashed passwords.

Related: U.S. Woman Charged Over Attempted Dark Web Murder-for-Hire Paid With Bitcoin

“Even though passwords were hashed and they are very unlikely to be retrieved from the hashed form, we recommend changing your password as soon as possible,” KeepChange told users.

Withdrawal requests have been disabled until Thursday pending further investigation and allowing users enough time to reset their passwords. From Friday, users will be able to make withdrawal requests as usual.

Meanwhile, deposits and trades remain active and are functioning as normal.

“We have done other required actions in the last hours, to be sure that no similar attacks can occur,” the exchange said.

Related: Blockfolio Apologizes After Racist Terms Posted in Portfolio App

See also: Why Ledger Kept All That Customer Data in the First Place

• BitMEX Introduces Data Storage Framework for FATF’s Travel Rule
• Investors Pump $250M Into Reddit Following Social Media Site’s Role in GameStop Mania

Crypto exchange BitMEX has published a framework of principles for how best to store additional batches of transactional provenance data, a requirement exchanges face as part of new anti-money laundering (AML) rules.

In order to fall in line with the rest of the financial system, virtual asset service providers (VASPs) have been asked to obtain, hold and exchange information about the originators and beneficiaries of transactions, known colloquially as the “Travel Rule.” Global anti-money laundering watchdog, the Financial Action Task Force (FATF) expects the crypto industry to implement the new rule by June 2021.

The response from the crypto industry has been enthusiastic, including a widely agreed-upon standard for the format of the data payload VASPs must share (known as the InterVASP messaging standard, or IVMS101), as well as a number of technical solutions focused on how best to implement the rule currently being built by crypto firms, banks and consortia.

Related: Investors Pump $250M Into Reddit Following Social Media Site’s Role in GameStop Mania

Less attention has been given to how all this additional customer data should be stored, according to Malcolm Wright, chief compliance officer of 100x Group, the owner of BitMEX.

“Solution providers have been concentrating on the transmission of the data to make sure that it’s immediate and secure,” Wright said in an interview. “But what about when the data actually arrives at its destination? How can you ensure that it’s stored securely and appropriately to the right sort of standards?” 

Wright, who led the development of the data-storage principles (and was also instrumental in working with Sian Jones of XReg Consulting to create the IVMS101 standard), decided to leverage BitMEX’s seasoned security experts, with the intent to “start a conversation” around data storage via an open-source project that industry and regulators can chime in on. 

“This kind of completes the puzzle,” Wright said. “You have the IVMS standard for the format of the data. You have the protocol providers, who will be transmitting the data. And then you have some principles around the storage of the data.” 

Related: Bitcoin Tops $47K After Tearing Through $45K, $46K in Tesla-Fueled Rise

Seychelles-based BitMEX was thrust into the spotlight last year following an enforcement action from U.S. authorities around weak compliance procedures at the firm, which saw arrest warrants issued for some senior executives and co-founders.

BitMEX owner 100x Group hired Wright, formerly the compliance chief at Diginex, in October 2020. Since then the firm’s AML/KYC processes have been revamped, starting with the removal of any historic non-KYC’d accounts on the platform. 

BitMEX’s Travel Rule Data Storage Principles focus on things like access management, encryption standards and keeping Travel Rule data separate from other operational customer data. 

Like the IVMS101 messaging standard, Wright thinks this security benchmark will further grease the wheels when it comes to implementing the FATF mandate, which may involve VASPs looking to onboard each other as they side with certain technical solutions.

“So If BitMEX chooses to be exchanging data with another VASP, then we can say, ‘Are you operating to a minimum set such as these?’ So that also helps to get confidence among VASPs that they can work together,” said Wright.

• TokenInsight: 2020 Cryptocurrency Futures Industry Report
• Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”

Reddit has raised $250 million in a Series E fundraising round, the company announced Monday night. 

The social media site, which said both new and existing investors participated but did not disclose their names, plans to double its headcount with the funds, as well as build out its “video, advertising, consumer products” and international efforts, according to a blog post. 

According to the Wall Street Journal, this means Reddit plans to have a total of 1,400 employees by the end of 2021 and now enjoys a $6 billion valuation. 

Related: Bitcoin Tops $47K After Tearing Through $45K, $46K in Tesla-Fueled Rise

The company has made headlines over the past few weeks, most notably when its r/WallStreetBets community helped pump GameStop’s share price and other securities to triple-digit growth, triggering Securities and Exchange Commission investigations and Congressional hearings. This mania later spread to Dogecoin and XRP, both of which saw massive price run-ups.

“Time and again, we have seen the power of community and connection alongside the growth and evolution of those communities and the humans behind them,” Monday’s announcement said.

The blog post didn’t mention the GameStop pump, though a Super Bowl ad purchased by the company for Sunday night’s game obliquely referenced it, saying “one thing we learned from our communities last week is that underdogs can accomplish just about anything when they come together around a common idea.”

Reddit did not discuss its current financial situation but noted in Monday’s announcement that it sees over 50 million daily users and said its direct advertising revenue increased 90% over the past quarter, compared to the last quarter of 2019.

Related: TokenInsight: 2020 Cryptocurrency Futures Industry Report

“We continue to invest in building and improving the ways people on Reddit connect – whether that’s traditionally through text-based discussions or through video or live streaming,” the blog post said. 

While Monday’s announcement did not mention its recent crypto forays, it comes just under two weeks after the company expanded its partnership with the Ethereum Foundation in the hopes of “bringing Ethereum to Reddit-scale production.”

• Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”
• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”

In a run reminiscent of bitcoin’s stunning ascent in early January, the price of leading cryptocurrency blew past $45,000, $46,000 and $47,000 in less than an hour on Monday evening, driven by Tesla’s announcement that it had bought $1.5 billion of bitcoin.

• Bitcoin hit $47,513.57, a new all-time high, before settling back to $47,053.09, up 20.6% in the last 24 hours.
• $45,000 was supposed to have been a milestone of sorts but the cryptocurrency’s race upwards turned it into an afterthought. The cryptocurrency has risen about 67% year-to-date.
• A combination of traders in Asia just waking up to the Tesla news combined with a lack of resistance levels above $45,000 were possible causes for the sudden gap upwards.
• While those might be the immediate catalysts for the sudden surge in the cryptocurrency, they’re not the only reasons for bitcoin’s stunning rise.
• A growing number of big institutional investors including Paul Tudor Jones II and Bill Miller have pushed into bitcoin as a potential hedge against inflation, as the Federal Reserve and central banks around the world pump trillions of dollars of freshly created money into financial markets to stimulate their coronavirus-racked economies.
• Tesla joins publicly traded companies including Michael Saylor’s MicroStrategy that have steered corporate money into bitcoin. And from the price of bitcoin today, it’s clear some investors think it’s just getting started.
• “We think this is just the start to a much wider adoption from household institutional names, finally ready to make the crossover into the crypto space,” Joel Kruger, strategist at the cryptocurrency exchange LMAX Digital, said in an email.
• As more institutional investors like Tesla are buying bitcoin and “hodl” it for the long term, bitcoin’s liquid supply is continuing to decline, according to blockchain analytics firm Glassnode’s newsletter on Monday.
• “Currently, around 78% of issued bitcoin are either lost or being hodled,” the newsletter said. “This leaves less than 4 million bitcoin to be shared amongst future market entrants – including large institutional investors such as PayPal, Square,
• Bitcoin’s latest rally also pushed prices for other major cryptocurrencies including ether, algorand, and litecoin, according to CoinDesk 20.
• “Mainstream adoption [for crypto] is happening right before our eyes, and it is taking place before the entire world,” Mati Greenspan, founder and CEO of Quantum Economics, wrote in his newsletter on Monday. 
• With this latest surge, the market value of bitcoin ($860.4 billion) has once again passed that of Tesla ($818.4 billion) after topping it for the first time ever earlier Monday.
  

UPDATE (Feb. 8, 23:35 UTC): Updates to add bitcoin passed $46k for the first time.

• Investors Pump $250M Into Reddit Following Social Media Site’s Role in GameStop Mania
• TokenInsight: 2020 Cryptocurrency Futures Industry Report
• Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”
• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”

Bitcoin’s price is getting closer to Mars thanks to Elon Musk while ether moons to a new record. Investors are pulling BTC out of DeFi, likely to diversify their profits.

• Bitcoin (BTC) trading around $44,023 as of 21:00 UTC (4 p.m. ET). Climbing 14.5% over the previous 24 hours.
• Bitcoin’s 24-hour range: $38,051-$44,801 (CoinDesk 20)
• BTC well above the 10-hour and the 50-hour moving average on the hourly chart, a bullish signal for market technicians.

Bitcoin’s price hit a record-high price Monday, soaring to $44,801 at around 13:00 UTC (8 a.m. ET). It’s one month to the day since hitting the previous record of $41,375, according to CoinDesk 20 data.

One catalyst for the price run-up: Entrepreneur Elon Musk’s Tesla (TSLA) plowed $1.5 billion into the cryptocurrency. The company also said it would accept bitcoin for goods and services rendered. 

Related: TokenInsight: 2020 Cryptocurrency Futures Industry Report

Read More: Tesla Invests $1.5B in Bitcoin, Plans to Accept Crypto Payments

“All bets are off the table now. I was worried that [at] around $35,000-$40,000 we were not seeing a huge amount of institutional flows, and over the weekend the market moved higher in a fairly weak fashion,” noted Chris Thomas, head of digital assets for. Swissquote Bank. “But Tesla would have bought over the last few weeks, a little every day.”

Since the start of 2021, bitcoin spot exchange volumes by eight major exchanges tracked by the CoinDesk 20 have been higher than its six-month average. 

This year so far, average trading on these exchanges has been $4.4 billion per day; going back to Aug. 8, 2020, the daily average has been $1.7 billion. As of press time Monday, volume is also higher than that 2021 average, at over $6.7 billion.

Related: Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”

“Bitcoin is at new highs today in ‘frenzied’ buying, clearing minor resistance from January,” said Katie Stockton, a technical analyst at Fairlead Strategies. Stockton also noted bitcoin has lost steam since its Musk-motivated rally, at $44,023 as of press time. “Signs of exhaustion are associated with today’s steep rally from an overbought/oversold perspective,” she said.

However, the trend remains bullish, Stockton added. “Despite the potential for additional short-term volatility, the long-term uptrend appears healthy behind bitcoin from a momentum perspective.“ 

While some may be skittish about bitcoin’s rise in 30-day volatility over the past three months, other types of traders are certainly enthusiastic about it.

“Tesla buying bitcoin was a mostly predictable move, given the vocal support it has seen from CEO Elon Musk,” said Guy Hirsch, U.S. managing director at eToro.

Read More: Ex-OCC Chief Brooks Calls Tesla’s Bitcoin Buy a Bit ‘Scary’ for Rest of World

“If more companies begin making similar announcements, $50,000 could potentially be within reach during the next few months,” Hirsch added. 

“We think we’re only just scratching the surface when it comes to corporate and institutional participation in the world of bitcoin and cryptocurrencies,” Joel Kruger, cryptocurrency strategist at LMAX Digital, told CoinDesk. “We suspect that moves from visionaries like Tesla will only serve to reinforce the tremendous value proposition that decentralized assets have to offer.”

Meanwhile, ether (ETH) is also hitting records and the asset’s correlation with bitcoin has cropped back up to levels not seen since December. 

The second-largest cryptocurrency by market capitalization was up Monday trading around $1,720 and climbing 8.5% in 24 hours as of 21:00 UTC (4:00 p.m. ET). The price hit a fresh all-time high Monday, hitting $1,776, according to CoinDesk 20 data. 

Read More: Ethereum Futures Are Now Trading on CME

The amount of bitcoin held in Ethereum-based decentralized finance, or DeFi, has dropped almost 3.5% Monday, going from over 50,000 to 48,344 BTC as of press time, according to data aggregator DeFi Pulse.

Swissquote’s Thomas notes that Monday may be a day for larger players to start moving some bitcoin around because a fresh bitcoin price high might induce some investors to diversify their profits. 

“Larger hedge funds, etc., [that] had got into bitcoin between $15,000-$20,000 would naturally want to take profits around $45,000-$50,000″ for a profit of 2.5-3x. “I’ve always viewed that as a hard challenge,” Thomas told CoinDesk.

Digital assets on the CoinDesk 20 are all in the green Monday. Notable winners as of 21:00 UTC (4:00 p.m. ET):

• algorand (ALGO) + 19.9%
• cardano (ADA) + 13.4%
• kyber network (KNC) + 12.1%

Equities:

• The Nikkei 225 index in Asia ended the day in the green 2.1% as Japanese corporate earnings were better than expected for most companies reporting so far.
• Europe’s FTSE 100 closed climbing 0.53% as investors signaled optimism on further U.S. fiscal stimulus despite a poor economic outlook for the European continent.
• The United States’ S&P 500 index gained 0.74% as traders pushed the buy button on stocks amid optimism more government stimulus would lift the economy.

Commodities:

• Oil was up 1.9%. Price per barrel of West Texas Intermediate crude: $58.03.
• Gold was in the green 0.95% and at $1,830 as of press time.
• Silver is gaining, up 1.9% and changing hands at $27.32.

Treasurys:

• The 10-year U.S. Treasury bond yield climbed Monday to 1.169 and in the green 0.15%.

• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”
• Wall Street Shifts Focus From Blockchain Infrastructure to Crypto Assets

Cardano (ADA) and polkadot (DOT) are now fourth- and fifth-most valued crypto assets, respectively, after they both surpassed XRP in market capitalization earlier Monday. That’s due to the recent rally in decentralized finance (DeFi) and the increased cost of using the Ethereum blockchain. 

According to data from analytics site Messari, cardano’s market cap stands at approximately $21.82 billion while and polkadot’s is at roughly $19.83 billion. For XRP, that figure is about $16.36 billion.

The latest rally of the two cryptocurrencies of these public blockchains is not “idiosyncratic pumps,” according to investors and analysts who spoke to CoinDesk, but is a bet on these public blockchains’ “Ethereum-killer” narrative. Investors and traders are increasingly viewing Ethereum’s blockchain as too expensive and difficult to use while decentralized finance (DeFi), usually built on Ethereum, continues to boom.

Related: TokenInsight: 2020 Cryptocurrency Futures Industry Report

Data from blockchain analytics firm Glassnode shows when ether’s price jumped after the CME launched its ether futures contract on Sunday, the Ethereum blockchain’s transaction fees started climbing again. On a 24-hour moving average, the network’s total transaction fees, as of 14:00 UTC (9 a.m. ET) Monday, Feb. 8, was at $1,003,727.15.

“[Ethereum] is seemingly too clogged,” Mable Jiang, a principal at crypto investment firm Multicoin Capital. “[Cardano and Polkadot] fit into the larger narrative of ‘seeking for a scalable blockchain,’ so if the capital within the crypto capital market is looking for some latest narrative to shill, this is it.”

Jiang’s Multicoin Capital, a Austin, Texas-based crypto fund, has invested in many so-called “Ethereum Killers,” including Solana and Algorand.

Read More: High Gas Fees Prevent Ethereum From Being Ethereum

Related: Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”

Helping to drive the latest ether rally is the explosive DeFi sector; approximately $36.13 billion is locked in DeFi at the moment, per DeFI Pulse data. The majority of top DeFi protocols by market capitalization are based on Ethereum including Aave, Uniswap, Maker, Synthetix and Compound.

Using the Ethereum network has become more expensive, and it’s not just because of DeFi. According to Jiang, another factor is bitcoin’s latest rally to a new all-time high earlier Monday after U.S. electric car manufacturer Tesla (NASDAQ: TSLA) announced its purchase of $1.5 billion of bitcoin. 

“Right now, there’s such a big rally because of Tesla’s disclosure, and if people are going to close their short position on ether, they’d pay $50-$100 [worth of] gas [fee] per transaction probably,” Jiang said. “This is no longer affordable [for] any small-size retailers” using decentralized derivatives platforms.

In the hour leading up to press time, the average gas price was 307 gwei, according to gas fee tracker gasnow.org, which is powered by Ethereum mining pool Sparkpool. “Gas” refers to the internal pricing unit for running transactions on Ethereum and is denoted in gwei, which is equal to one billionth of an ether.

Read More: Ethereum Futures Are Now Trading on CME

A report published earlier this month by crypto venture capital firm Outlier Ventures noted that Cardano is the second-most actively developed protocol behind the Ethereum blockchain, while Polkadot has doubled the number of monthly active core developers between last July and November. 

“Given the market focus on all things DeFi, one would be forgiven for missing the recent Cardano upside but the underlying fundamentals are very supportive,” Denis Vinokourov, head of research at Bequant, said. “Equally, Polkadot was also highlighted as another actively developed protocol and its interoperability play and venturing into DeFi is well documented.”

On a year-to-end basis, cryptocurrencies of other major smart contract platforms have also seen significant growth. Solana (SOL), cosmos (ATOM) and algorand (ALGO) were up 320.3%, 141.4%, and 130.81%, respectively, according to Messari.

• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”
• Market Wrap: The ‘Elon Effect’ Blasts Bitcoin to $44.8K While Ether Moons

The market valuation of bitcoin briefly exceeded that of Tesla after the electric automaker announced Monday it had purchased $1.5 billion of the largest cryptocurrency for its treasury.

• After Tesla filed its annual report with the U.S. Securities Exchange Commission disclosing the purchase, shares of bitcoin took off, setting a new all-time high of $44,801.87.
• Bitcoin’s market value naturally rose as well, increasing to $834.2 billion and making the cryptocurrency more valuable than all but seven of the world’s publicly traded companies, just ahead of Tesla with its market cap of $820.7 billion.
• The price of bitcoin has since given back some of its gains, trading hands at press time at $42,964.05, up 11.78% in the last 24 hours.
• That retreat has allowed Tesla to reclaim the seventh spot, leaving bitcoin in eighth place, still ahead of Facebook ($756.4 billion), which the cryptocurrency also passed on Monday.

• TokenInsight: 2020 Cryptocurrency Futures Industry Report
• Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”
• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”
• Market Wrap: The ‘Elon Effect’ Blasts Bitcoin to $44.8K While Ether Moons

Castle Island Ventures, the early-stage crypto fund helmed by Nic Carter and Matt Walsh, has raised $50 million for its second fund.

“We believe that public blockchains are a transformative technology and will change the way that we interact with money, value transfer, trusted third parties and even the fundamental architecture of the internet itself,” Walsh wrote in an announcement post published Monday.

In a call with CoinDesk, Carter said the fund’s investors include high-net-worth individuals, family offices and others. The firm raised $30 million in June 2018 for its first fund, which invested in 20 startups including BlockFi, ErisX, River Financial and Casa, among others.

Related: TokenInsight: 2020 Cryptocurrency Futures Industry Report

“My first love is bitcoin and we’re not abandoning bitcoin,” said Carter, who is also a CoinDesk columnist. “Our focus has always been crypto financial market infrastructure and bitcoin is not the only part of that.”

Carter pointed to the growth of stablecoins and decentralized approaches to internet infrastructure as potential areas of interest for the new $50 million war chest.

“There are adjacencies that are interesting to us,” Carter said. “There’s a slight broadening of our focus to reflect the maturity of that space.”

The second fund will target about 20 startup investments with slightly larger check sizes than the first, Carter added.

• Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”
• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”
• Market Wrap: The ‘Elon Effect’ Blasts Bitcoin to $44.8K While Ether Moons

Apple (AAPL), the maker of hot-selling items from iPhones to tablets, is the world’s largest publicly traded company, with a market capitalization of $2.3 trillion. 

So it almost seems natural that after the electric vehicle maker Tesla announced Monday a $1.5 billion purchase of bitcoin, at least one Wall Street analyst is running the math on whether Apple might benefit from jumping into the cryptocurrency fray. 

A new report from the brokerage firm RBC Capital Markets posits that Apple, which already provides payments wallets for millions of consumers in an economy that’s gone increasingly cashless since the coronavirus pandemic hit in early 2020, might be able to easily generate more than $40 billion from the cryptocurrency business. The company’s move could also help to make the U.S. a technological leader in cryptocurrencies for the next decade or two. 

Related: TokenInsight: 2020 Cryptocurrency Futures Industry Report

The RBC analyst, Mitch Steves, figures that the payments firm Square (SQ) generates about $1.6 billion per quarter in bitcoin-related revenue on an active install base estimated at around 30 million. 

“Apple’s install base is 1.5 billion, and even if we assume only 200 million users would transact, this is 6.66x larger than Square,” according to the report. “Therefore, the potential revenue opportunity would be in excess of $40 billion a year (15% incremental top-line opportunity).”

According to the report, the research and development cost involved in the effort “would be de minimis in our view as Square’s entire R&D budget is under $1 billion.”

Competition in the crypto exchange space “is light,” the analysts wrote. Regulations make it difficult for U.S. consumers to purchase crypto, and many of the exchanges go down during times of high volume, they wrote.

Related: Fiscal Response to COVID is the “Greatest Backdrop to Bitcoin Ever”

Apple could solve the regulatory and know-your-customer (KYC) challenges of cryptocurrencies if it created a closed system in which it only transfers the ownership of crypto between customers, the analysts noted. 

It could also develop an open system that uses a bitcoin wallet and banking service Strike or the Bitcoin blockchain’s Lighting Network to reduce the cost of converting fiat to crypto, they added.

Apple standing up a crypto exchange could also reduce the likelihood the U.S. bans bitcoin in the future, the analysts said. 

“If Apple went down this path the U.S.A. would likely acquire the most crypto assets from a global perspective,” the analysts wrote. “If the U.S.A. owns the most crypto assets (be it bitcoin or other assets), it would not make logical sense in our view to ban it. In addition, with Apple’s secure and world-class software, the U.S.A. would be able to have confidence in user information and balances if needed in the future.”

There’s even a trick that Apple might pull to finance the project’s development: Bet money on bitcoin. 

The analysts proposed that Apple pay for the cost of developing an Apple crypto wallet or exchange (around $500 million, per their estimates) by adding bitcoin to the tech giant’s balance sheet.

“For example, if the firm purchased $5 billion of bitcoin (20-25 days of cash flow), the price of the underlying asset would need to rise by 10% for the firm to fully fund the entire project in the first place,” the analysts wrote. “This is a solid value proposition in our view as the business would be funded without diluting any other projects at the firm.”

Read the full report:

• Announcements of Bitcoin Payment Services is Getting “Faster and Louder”
• Market Wrap: The ‘Elon Effect’ Blasts Bitcoin to $44.8K While Ether Moons