CoinDesk Crypto

Prices for DOT, the native token of Polkadot and its cross-chain protocol for data and asset interoperability, have risen more than 40% in the last week after two votes of confidence by Binance, the biggest crypto exchange by spot trading volume.

• At the time of writing, DOT was at $7.21, according to data from Messari, up 17.27% in the past 24 hours, and up 41.36% in the past seven days.
• The currency’s ascent began on Dec. 23 when Binance announced a $10 million fund to support projects on Polkadot.
• DOT really took off, however, on Dec. 28 after Twitter users noticed the ETH/BUSD pair on Binance’s homepage had been replaced by the DOT/BUSD pair, giving DOT a lot more exposure.

• Some retail traders have been looking for tokens that could potentially outperform bitcoin in the short term after the No. 1 cryptocurrency by market capitalization briefly surpassed $28,000 on Sunday, according to Mable Jiang, principal at crypto hedge fund Multicoin Capital.
• Founded by Ethereum co-founder Gavin Wood, Polkadot is a blockchain network that supports various interconnected sub-chains called “parachains.”
• “Parachains” can run higher transaction throughput than Ethereum because of its more sophisticated design, as CoinDesk reported previously.

• New Research Sheds Light on the Front-Running Bots in Ethereum’s Dark Forest
• Market Wrap: Bitcoin Down to $26K but Traders Remain Bullish
• 16 Ethereum Predictions From a Crypto Oracle
• SEC Disapproves BOX Security’s Request to Report Stock Trading Data on Ethereum Blockchain

Anthony Scaramucci’s SkyBridge Capital investment firm has invested $182 million in bitcoin, according to an investor brochure shared with CoinDesk about its forthcoming bitcoin fund. 

The firm, which has $9.3 billion under management, is launching the SkyBridge Bitcoin Fund LP in January, according to Securities and Exchange Commission documents filed on Dec. 21, as CoinDesk reported. 

The bitcoin fund has already invested $25 million in bitcoin, it announced in the brochure. The new fund will be open as of Jan. 4 to outside investors putting up at least $50,000. 

Related: Market Wrap: Bitcoin Down to $26K but Traders Remain Bullish

Scaramucci’s fund investment is yet another traditional investment firm jumping on the bitcoin bandwagon, a trend that has driven the crypto’s price well north of $20,000 in recent weeks. 

In its brochure touting the bitcoin fund, the firm laid out the appeal of bitcoin to investors. 

“Bitcoin is digital gold,” it reads. “It is better at being gold than gold.”

The brochure describes bitcoin as an emerging asset class that has become less risky in recent years, with attractive supply-and-demand dynamics. Bitcoin has had increasing retail and institutional adoption, the brochure notes, calling current low interest rates and “unprecedented money printing” contributors to the premium being placed on “scarce assets like gold, real estate, art and bitcoin.”

Related: Panthers’ Russell Okung Becomes First NFL Player to Be Paid in Bitcoin

One page of the brochure highlights “Bitcoin respectability: Wall Street embraces bitcoin” featuring quotes from executives at firms such as BlackRock and banks such as Citibank and JPMorgan. 

According to the brochure, SkyBridge believes hedge funds, public company treasurers, insurance companies, pension funds, banks and brokerage firms will also be investing in the space. 

“You have to accept whether bitcoin is a store of value or not,” said Scaramucci, one of the founders of SkyBridge, in a recent interview on CNBC. “There are still skeptics out there and that’s why I think we’re in the first inning. But after the research we’ve done … and given the monetary supply and the global central banking coordination right now, this will be a very strong asset class over the next decade.”

• Michael Saylor of the North? Canadian Firm NexTech AR Uses $2M of Treasury Funds to Buy Bitcoin
• India Mulls Imposing 18% Tax on Bitcoin Transactions

Cryptocurrency exchange and finance platform Crypto.com said Monday night it will delist and suspend trading in the U.S. of XRP, the cryptocurrency behind the U.S. Securities and Exchange Commission lawsuit against Ripple Labs last week.

• Effective Jan. 19, 2021, at 10 a.m. UTC, XRP will be delisted and trading suspended from the Crypto.com App in the U.S. 
• Crypto.com’s move came the same day two other crypto exchanges, Coinbase and OKCoin, also announced suspensions of the XRP token.
• On Tuesday, crypto payments firm Wirex and bitcoin app Ziglu took similar actions, according to The Block. Wirex won’t include XRP in a U.S. version of its app while Ziglu will suspend trading in XRP as of Jan. 12, 2021.
• Meanwhile, also Tuesday, the Bittrex Exchange said it will remove XRP markets on Jan. 15, 2021, while Swipe Wallet said it will be delisting XRP for U.S. customers on Jan. 5, 2021.
• The SEC claimed last week that XRP is a security, and that Ripple has been selling it without registering or seeking an exemption for seven years, raising $1.3 billion in the process. The legal battle is just beginning, and litigation might take years to resolve. Ripple has said it would fight the lawsuit.
• In a general statement released Tuesday, Ripple said that with the “uncertainty” introduced into the market as a result of the SEC’s legal action, it’s “no surprise that some market participants are reacting conservatively as a result.”
• Given that exchanges that handle the trading of securities must fill out a lot more paperwork than those that don’t, it’s little wonder crypto exchanges and market makers are backing away from XRP.
• Like Coinbase, Cypto.com said it will continue to support the Spark (FLR) Token Distribution to XRP holders, which is currently set for the first half of 2021.

UPDATE (Dec. 29, 22:45 UTC): Adds Ripple comment. Adds actions by Wirex, Ziglu and Swipe.

Read our ongoing coverage of the SEC’s case against Ripple and its impact on the industry here.

• Market Wrap: Bitcoin Down to $26K but Traders Remain Bullish
• Coinbase to Suspend XRP Trading Following SEC Suit Against Ripple
• OKCoin to Suspend XRP Trading and Deposits on Jan. 4
• XRP Is a Crypto Asset in Japan, Not a Security, Ripple Partner SBI Claims

Opyn, a marketplace for decentralized finance (DeFi) options, has rolled out new features in its updated protocol that aim to make the crypto options markets more efficient and liquid. 

While Opyn entered DeFi with an insurance-like product for governance tokens such as Compound’s COMP, its focus has since pivoted to the options market in the digital asset space. According to Zubin Koticha, co-founder of Opyn, the pivot is driven both by user interest and by the sort of hurdles DeFi currently faces. 

“The biggest issue with DeFi is that [in] traditional finance, you don’t need super over-collateralization,” said Koticha. Differing capital requirements also eat into DeFi’s competitiveness with traditional finance, he added. 

Related: Who Insures the Insurer? Cover Protocol Attack Exposes DeFi’s Promise and Peril

Put simply, options are financial contracts that give users the right to buy or sell an underlying instrument at a predetermined price on or before a specific date. Depending on what they make of market trends, options allow traders to bet on the future bullish or bearish nature of the market. 

While options have long existed in traditional finance they are relatively new to the crypto space and hence come with their own hurdles. 

Koticha pointed out that under Opyn’s earlier version users needed to put up 100% of the strike price, the agreed-upon price for the option, as collateral in order to mint and sell one. This differs from traditional options markets where the requirements can be significantly lower. 

According to Opyn, the update will add a host of new features to its options marketplace, including cash settlement for options without the need to exchange underlying assets, the ability for yield-earning assets to be used as collateral for options, and margin improvements for options. 

Related: Cover Protocol May Launch New Token Following Attack

“We changed our system from physical settlement to cash settlement,” said Koticha. Noting that while traditional markets also cater to needs to settle options in physical commodities like grain, he said there is no such physical delivery need in the crypto space and hence little need to actually exchange the asset. Instead, only the difference in price needs to be delivered.  

Although the overall thrust of changes at Opyn are geared toward added efficiencies in how DeFi handles capital, the changes are only part of the upgrades in the pipeline. Koticha said Opyn is also plotting a protocol upgrade that will add the functionality to net short and long options together, thereby freeing up more capital. 

Earlier in August, Opyn discovered a vulnerability on its platform when attackers were able to exploit a bug and walk away with $370,000. According to report by Cointelegraph, the bug allowed attackers to double-spend Opyn’s oToken and thereby steal the collateral put up by users. 

In response, Opyn laid out in a blog post a set of measures it would adopt to prevent another such exploit and also compensated users affected by it. According to Koticha, the platform has continued to build on its security by performing additional audits and adding a functionality to pause the system. 

While a central kill-switch seems counterintuitive to the ever-bustling crypto markets, Koticha said that with plans to launch a governance token in the future Opyn wants to transfer the kill-switch controls to decentralized governance for the long run. 

• Cover Protocol Attack Perpetrated by ‘White Hat,’ Funds Returned, Hacker Claims
• Deribit Adding Options to Allow Bitcoin Traders to Bet on Rally to $120K, $140K

Cryptocurrency trading and investment management platform eToro is considering going public in what would be a $5 billion IPO, according to a report by Israel-based news outlet Calcalist, which did not name any sources.

• Israel-based eToro is reportedly in talks with Goldman Sachs about possibly leading the offering, which would be completed by the end of Q2 2021.
• eToro is also considering the possibility of a merger with a special purpose acquisition company for the “purpose of accelerating entry into Wall Street trading,” the report said.
• eToro has recruited 5 million new customers since the beginning of the year and is profitable, according to the report.
• The company declined to comment on the report, Calcalist said.

Read more: Coinbase, With Bitcoin Soaring, Files in Preparation for Landmark Public Offering

• Coinbase Going Public Could Let the SEC Dictate Which Tokens Get Listed
• Coinbase Picks Goldman Sachs to Lead Upcoming IPO: Report
• Bitcoin Exchange Safello Raises $1.3M for Planned 2021 IPO
• Crypto Bank Sygnum Tokenizes Shares, Eyes Public Offering

The New York Department of Financial Services has issued a trust charter to GMO-Z.com Trust Company, allowing it to “issue, administer and redeem” Japanese yen (JPY)- and U.S. dollar-pegged stablecoins in New York.

• The regulated JPY-pegged stablecoin will be the first of its kind available to the public.
• GMO is a Tokyo-based internet conglomerate and said it is the world’s largest online FX trading platform.
• The charter makes GMO one of only 27 companies licensed in New York to engage in virtual currency activities.
• “We’re breaking ground with our move to issue the first regulated JPY-pegged stablecoin, which many see as a safe-haven asset,” said Ken Nakamura, president and CEO of GMO-Z.com Trust Company, in a statement.

• What Are Stablecoins?
• Presidential Advisory Group Weighs In on Regulatory Approach to Stablecoins
• Warp Finance Suffers Possible $8M Flash Loan Attack
• Nationalizing Stablecoins Won’t Improve Financial Access

The Chicago Mercantile Exchange (CME) has become the largest bitcoin futures exchange by number of open contracts as institutional interest in bitcoin continues to grow.

• As of Tuesday, open interest on the CME stood at $1.66 billion, the highest among the major derivatives exchanges that including OKEx, Binance and Bybit, according to data from crypto data analytic site Skew.

• CME now accounts for 18.1% of the total global open interest on Tuesday, currently sitting at approximately $9.18 billion.
• Skew’s data also shows that CME logged the highest trading volume for its bitcoin futures contracts on Dec. 28.

• “Institutional investors were eager to trade bitcoin again yesterday after a few days off,” Norwegian cryptocurrency analysis firm Arcane Research wrote in a tweet earlier Tuesday.
• CME’s bitcoin futures products have seen rapid growth this year because of a surge in institutional capital inflows to the No. 1 cryptocurrency by market capitalization and its derivative markets.
• Bitcoin’s price passed $28,000 on Sunday, and many have attributed the price rally to the new institutional money flowing to the cryptocurrency.

• Market Wrap: Bitcoin Down to $26K but Traders Remain Bullish
• On-Chain Data Suggests More Institutions Are Buying Bitcoin Over the Counter
• Ruffer Investment Used Coinbase to Execute $745M Bitcoin Buy
• SBI Financial Acquires Institutional Crypto Desk B2C2

“Pay me in bitcoin” has come true for National Football League player Russell Okung. Some 20 months and a 273% price increase after he first tweeted that demand in May 2019, Okung will be the first player from any major U.S. sports league to be paid in bitcoin.

The arrangement comes by way of Zap, the bitcoin startup founded by Jack Mallers. Zap’s Strike product enables traditional paychecks to be converted into BTC.

Okung’s just happens to be quite large. His $13 million yearly salary is being split 50-50 between bitcoin and fiat, Mallers said Monday in a phone interview with CoinDesk.

Related: Market Wrap: Bitcoin Down to $26K but Traders Remain Bullish

Mallers said other pro athletes, including unnamed members of the Brooklyn Nets basketball team and baseball’s New York Yankees, have also begun onboarding to the program. Mallers said the NFL and NFL Players Association had to be involved to get approval. It is unclear if such approvals are also required for the National Basketball Association and Major League Baseball. 

Technically speaking, Okung is still being paid in fiat. Behind the scenes, however, is Lightning Network magic: Strike receives a direct deposit from his team, the Carolina Panthers, and then swaps dollars for bitcoin. That bitcoin is then sent to a cold storage wallet held by Okung, Mallers said. (To recap, Lightning is a secondary system for sending bitcoin in a cheaper and quicker fashion compared to using the Bitcoin network itself.)

Strike, which launched in private beta about a year ago, can connect to any bank account via a routing number, according to Mallers. Square’s Cash App worked in a similar manner by partnering with Lincoln Savings Bank and Sutton Bank before Square received a banking license in March.

The Okung announcement also serves to tease another bit of news from Zap. Strike can now be used as a checking account through partnerships with two yet-to-be-named banks, according to Mallers.

Related: SkyBridge Capital Has Already Invested $182M in Bitcoin

Mallers said Strike is now processing into the “seven figures” of monthly volume and expects that number to grow as more big names join Strike’s newest payment method. Strike does not currently receive any cut for processing payments, Mallers said, but it might as the product gains adoption.

“It’s a big, big deal that we found a way to allow any individual to receive a [percentage] of their labor in bitcoin,” Mallers said.

As Okung expressed in a recent CoinDesk op-ed, the lineman’s journey to bitcoin began long before that May 2019 tweet. The 32-year-old Okung said he has long been frustrated with the lack of economic power professional athletes – particularly Black athletes – currently hold. Okung views bitcoin as a means of regaining financial independence and has launched an advocacy project in that vein.

• Michael Saylor of the North? Canadian Firm NexTech AR Uses $2M of Treasury Funds to Buy Bitcoin
• India Mulls Imposing 18% Tax on Bitcoin Transactions

Israel-based payments processor Simplex said Tuesday it has become a principal member of the Visa network.

• Through the membership, Simplex now has permission to issue Visa cards, giving its consumers access to digital currencies daily.
• “We’re excited to work with leading fintechs like Simplex [that] are helping to enable simple, secure and compliant conversions between crypto and fiat and the ability to spend these funds at Visa’s network of more than 60 million merchants,” said Cuy Sheffield, senior director and head of cryptocurrency at Visa.
• Simplex launched its platform in 2014 allowing consumers to buy digital currencies with their credit cards.
• Earlier this year, Simplex made Hedera Hashgraph’s native cryptocurrency HBAR available for purchase through its platform. 

Read more: You Can Now Buy Hedera Hashgraph’s HBAR Token via Simplex

• Payments Firm Wirex Becomes Visa Principal Member Ahead of Crypto Card Launch
• Robot Ventures, Others Back ‘Crypto Stripe’ Flexa in $6M Raise
• How Israeli VCs Are Doubling Down on DeFi Startups
• Evercore Says PayPal’s Crypto Offering Could Bring Big Business Boost

Canadian augmented reality (AR) company NexTech AR is jumping on the crypto bandwagon with plans to use its treasury funds to buy $2 million of bitcoin for “capital diversification.”

• Announced Tuesday, the AR company said it plans on making an initial investment of $2 million in bitcoin and may add more in 2021.
• As of Sept. 30, the company had C$16.39 million (US$12.79 million) cash on hand, making the investment roughly 15.6% of its available cash, assuming the $2 million investment is in U.S. dollars. An email to NexTech seeking clarification wasn’t immediately answered.
• “Our investment in bitcoin is part of our new capital diversification and allocation strategy with the intent to maximize long-term value for our shareholders,” said NexTech CEO Evan Gappelberg in a statement.
• Gappelberg said the investment reflects his belief that bitcoin is a long-term store of value with more long-term appreciation potential than holding cash, which is currently yielding 0.06%.
• The CEO described bitcoin as a “digital version of gold,” which has a total market capitalization of $10 trillion versus bitcoin’s total market capitalization of $500 billion.
• Gappelberg is the latest CEO to use company treasury funds to buy bitcoin. Most prominent among these is MicroStrategy (NASDAQ: MSTR) CEO Michael Saylor, who has spent $1.125 billion on bitcoin to date.

Read more: Nasdaq-Listed Canadian Firm to Invest Over $1M in Bitcoin

• Market Wrap: Bitcoin Down to $26K but Traders Remain Bullish
• SkyBridge Capital Has Already Invested $182M in Bitcoin
• Panthers’ Russell Okung Becomes First NFL Player to Be Paid in Bitcoin
• India Mulls Imposing 18% Tax on Bitcoin Transactions

Cryptocurrency exchange OKEx has introduced real-time settlement for the trading of derivatives on its platform including futures, options and swaps, allowing users to make withdrawals at any time.

• OKEx said the real-time settlement function will only be available with the trading of the ADA/USD swap today at 8 a.m. UTC.
• Prior to the offering, transactions were usually settled at 4 p.m. UTC settlement period daily. This update will allow OKEx users to withdraw their profits at any time, said the exchange.
• OKEx said the function will then be rolled out to other major currency pairs and financial instruments on the platform over the coming months.

Read more: OKEx Bitcoin Mining Pool Shows Signs of Life After Precipitous Hashrate Drop

• OKCoin to Suspend XRP Trading and Deposits on Jan. 4
• Bitcoin Whales Buy Low, Sell High; Retail Investors Chase Rallies: Data
• Airbnb Pre-IPO Derivatives Contract Listed on Crypto Exchange FTX
• OKEx Bitcoin Mining Pool Shows Signs of Life After Precipitous Hashrate Drop

The city council of Lebrija has created a virtual currency, elio, that can only be used for payments made to small and medium-sized businesses, according to a report by Diario de Sevilla.

• Lebrija has created the virtual currency to support economic activity during the COVID-19 pandemic, according to the report.
• One Elio is equivalent to one euro and almost 600 families will receive between €20 (US$24.50) and €200 ($244.96), which can only be spent in local businesses using an app.
• The deadline to use the elio was Dec. 31 but, according to the report, this has been extended until March 31, 2021.

Read more: Spain’s Second-Largest Bank Will Soon Launch Crypto Services: Sources

• Spain’s Second-Largest Bank Will Soon Launch Crypto Services: Sources
• Ride-Sharing Giant Cabify to Track and Offset Carbon Emissions Using Blockchain Platform
• Major Spanish Firms Including Santander Unveil Blockchain Identity Project
• Spanish Police Arrest Head of Billion-Dollar Crypto Arbitrage Platform on Fraud Allegations

The Indian government is considering a bitcoin transaction tax that would add $1 billion in revenue a year, a move some industry participants said is a sign of the government’s growing comfort with cryptocurrencies.

A proposal put forward to the Central Board of Indirect Taxes & Customs (CBIC) by the Central Economic Intelligence Bureau (CEIB) would categorize bitcoin as an intangible asset and impose an 18% goods and services (GST) tax on bitcoin transactions, according to The Times of India. The proposal also suggests treating bitcoin as current assets and charging GST on margins made in trading.

An 18% GST on the estimated annual value of all bitcoin transactions of INR 40,000 crore (roughly $5.5 billion) would yield INR 7,200 crore or $1 billion in tax revenue.

Related: Market Wrap: Bitcoin Hovers Around $27K While ETH/BTC Pair Goes Bullish

Prominent India-based crypto exchanges say a potential tax structure would bode well for the ecosystem. “Government mulling a tax structure is a sign of better understanding of this novel asset class and we are hopeful that this would lead to more positive news going forward,” Sumit Gupta, CEO of Mumbai-based crypto exchange CoinDCX said in a WhatsApp chat. “Regarding the tax rate, and structure is something that we’ll wait and watch, but this is definitely a positive sign.”

Nischal Shetty, CEO of the Binance-owned WazirX exchange, echoed similar sentiments and added that clarity on the tax front could pave the way for increased Indian institutional participation in the bitcoin market. WazirX and Bangalore-based exchange Bitbns said that they are already paying GST on trading fees. “The GST amount paid has grown 500% in the last few months,” Gaurav Dahake, founder and CEO of Bangalore-based exchange Bitbns, told CoinDesk.

Trading volumes on exchanges catering to India-based clients have been rising ever since the Supreme Court quashed the Reserve Bank of India’s (central bank) banking ban on cryptocurrencies in March. While the Indian government does not consider bitcoin legal tender, simply holding cryptocurrencies is not illegal or banned. 

Also read: India’s Banks Are Once More Serving Crypto Traders and Exchanges

• Lending Platform Vauld Raises $2M to Grow Into a Full Crypto Bank
• Whale Sightings Become Scarce, Removing Downward Pressure on Bitcoin: Analyst
• The Rise of the Bitcoin Class

Publicly traded digital-asset brokerage Voyager Digital (OTC: VYGYF) was forced to take its system offline on Monday after a cyberattack compromised the exchange system.

• In a series of tweets, the Canada-based firm apologized and informed customers its domain name system (DNS) server was compromised but has since been recovered.
• “Unfortunately, I was faced with a tough choice today. We were alerted by our tracking system, and we decided to take the system offline. Safety and security of customer assets and information is paramount. I appreciate all the support of the community as we work through this,” tweeted Steve Ehrlich, co-founder, and CEO of Voyager.
• Voyager reassured its customers that no funds or personal information were compromised but warned it will take 24 hours to get its app back online again.

Read more: Voyager Digital Revenue Rises Over 1,000% on Increased Crypto Adoption

• Voyager Digital Revenue Rises Over 1,000% on Increased Crypto Adoption
• Voyager Agrees to Buy LGO Markets and Merge 2 Firms’ Tokens
• Voyager CEO Says Revenue Growth Accelerates 8-Fold as DeFi Trading Surges
• Venezuela Blocks Access to Coinbase and Remittance Service MercaDolar

Coinbase said it will suspend trading of XRP, the cryptocurrency the U.S. Securities and Exchange Commission sued Ripple Labs in regards to last week claiming it is really a security.

Coinbase first listed XRP on its retail-facing platforms in February 2019. Starting now, XRP trading “will move into limit only,” Coinbase wrote. It will be fully suspended on Tuesday, Jan. 19, 2021, at 1 p.m. ET.

“We will continue to monitor legal developments related to XRP and update our customers as more information becomes available,” Paul Grewal, Coinbase’s chief legal officer, wrote in a blog post shared in advance with CoinDesk.

Related: SEC Disapproves BOX Security’s Request to Report Stock Trading Data on Ethereum Blockchain

Coinbase said users’ XRP wallets will “remain available for receive and withdraw functionality after the trading suspension.”

Notably, the exchange said it will still support an upcoming airdrop of Spark tokens to XRP holders. XRP will still be supported by Coinbase Custody and in the self-custodial Coinbase Wallet.

Coinbase declined to comment beyond its written statement.

The price of XRP on Coinbase tanked from $0.28 to $0.24 within the first 20 minutes of the announcement. Since the announcement of the SEC’s lawsuit last week, the price of XRP has fallen by more than 50%.

Related: OKCoin to Suspend XRP Trading and Deposits on Jan. 4

For Coinbase, the reason for dropping XRP as a traded asset was simple: As the company seeks to go public, being a platform for something that’s potentially a security would mean adding more paperwork simply so it could be legally allowed to let retail customers buy and sell a single cryptocurrency.

The SEC claimed last week that XRP is a security, and that Ripple has been selling it without registering or seeking an exemption for seven years, raising $1.3 billion in the process. The legal battle itself is just beginning, and litigation might take years if Ripple fights the charge in court, as it has indicated it would.

Coinbase is now the biggest exchange to act on XRP and could serve as a bellwether for other platforms. On Friday, Bitstamp announced it would halt XRP trading and deposits for all U.S. customers on Jan. 8.

Similarly San Francisco-based OKCoin announced its XRP suspension earlier Monday, effective Jan. 4.

Exchanges that continue to list XRP without registering as a securities exchange with the SEC face potential consequences down the line, including possible enforcement actions. However, should Ripple prevail in its defense, Coinbase can likely re-list XRP fairly easily.

Alex Kruger, a trader and analyst, said, “Crypto exchanges are unregistered with the SEC (by choice, as registering carries on many burdens and increased costs) and thus it is in their best interest to not offer trading of securities. It is for their protection, not their customers’.”

Gabriel Shapiro, an attorney with Belcher, Smolen & Van Loo LLP, told CoinDesk last week that the question of whether exchanges should delist is a complicated one, with both business and legal considerations. 

UPDATE (Dec. 28, 23:35 UTC): Adds XRP price reaction.

• SEC Obtains Emergency Asset Freeze Against Virgil Capital
• XRP Is a Crypto Asset in Japan, Not a Security, Ripple Partner SBI Claims

Bitcoin has mostly traded in a tight, low-volume range Monday while some profit-taking from bitcoin into ether is appearing on the ETH/BTC charts.

• Bitcoin (BTC) trading around $26,822 as of 21:00 UTC (4 p.m. ET). Gaining 2.3% over the previous 24 hours.
• Bitcoin’s 24-hour range: $25,759- $27,447 (CoinDesk 20)
• BTC very near its 10-hour and 50-hour moving averages on the hourly chart, a sideways signal for market technicians.

Bitcoin’s price action has stagnated Monday, trading in a $27,000-$27,200 range for many hours, according to CoinDesk 20 data. The lack of movement follows a Sunday when bitcoin cracked an all-time high of $28,352, fueled by a bull run sparked on Dec. 25. 

A bit of a respite is par for the course, according to over-the-counter trader Alessandro Andreotti. “I think it’s just a minor retracement, a little pause after a week of all-time highs,” Andreotti told CoinDesk. “BTC is definitely still in bullish territory.”

Related: Whale Sightings Become Scarce, Removing Downward Pressure on Bitcoin: Analyst

Read More: Whale Sightings Become Scarce, Removing Downward Pressure on Bitcoin

After Sunday’s run that saw over $4 billion in volume on major CoinDesk 20 exchanges, Monday’s spot trading tally is much lower, at $1.8 billion as of press time. “Given the speed of the rise yesterday, especially after the last few days’ rally, a slight contraction is normal,” said David Lifchitz, chief investment officer of quant trading firm ExoAlpha. 

“Bitcoin continues on its strong upwards path with more retail investors now moving into bitcoin over the holiday break,” noted Jason Lau, chief operating officer of San Francisco-based cryptocurrency exchange OKCoin. However, flat spot volume may not be a trend heading into next year, according to Lau. “With the [U.S. economic] stimulus package being signed, the appeal of bitcoin as a store of value could continue into 2021.”

In the derivatives space, futures liquidations have helped to fuel bitcoin’s recent price run. This is evident in the number of liquidations – the equivalent of a margin call in traditional markets – on BitMEX. Over the past three days more than $116 million in liquidations occurred, with shorts being favored as buy liquidations hit $65 million. 

Related: The Rise of the Bitcoin Class

“At this stage there is a clear lack of sellers as all the leveraged shorts are liquidated,” quant trading firm QCP Capital wrote in its Monday investor note. “The bull story remains clear: Growing institutional adoption of BTC is driving price higher and is feeding the retail FOMO, which then extends across all of crypto.”

Other analysts agree with QCP that bitcoin’s price push is allowing other cryptocurrencies, particularly ether, to start getting more attention. “I think the BTC price slowdown is giving some breath for the altcoin season,” said Misha Alefirenko, founder of crypto market maker VelvetFormula. The ether futures market is trending back up after a record-high $2.2 billion in open interest lost some steam after Dec. 19. 

However, the news CME will be getting into the ether futures game is a positive sign for continued institutional interest in crypto, according to OKCoin’s Lau.

“Ethereum has maintained the upwards trajectory alongside bitcoin, reaching its highest levels since May 2018,” said Lau. The CME Ethereum futures offering in February, “could have a huge impact by exposing [ether] to more institutional investors.”

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Monday, trading around $732 and climbing 8% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

Read More: Cover Protocol Attack Perpetrated by ‘White Hat,’ Funds Returned

The ETH/BTC trading pair, a common offering on most exchanges, has suddenly gone bullish Monday after a long bearish cycle. This pair indicates the strength of ether versus bitcoin. The bullish signal on the hourly charts, including a spike in volume on Coinbase, suggests traders are selling bitcoin for ether.

Some profit-taking from bitcoin into ether is the main culprit, according to Vishal Shah, an options trader and founder of derivatives venue Alpha5.  “I think it’s the spillover effects of BTC exhaustion,” Shah told CoinDesk. He also added it is likely hardcore crypto traders ekeing out more gains in this bull cycle pushing the ETH/BTC hourly chart up. “This entire rally has been born of bitcoin, so [its] hard to see it simply shift gears. And if it does, it’s probably not the same ilk of investor.”

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

• cosmos (ATOM) + 9%
• cardano (ADA) + 8.5%
• bitcoin cash (BCH) + 7%

One notable loser:

• xrp (XRP) – 1.9%

Equities:

• Asia’s Nikkei 225 ended the day climbing 0.74% as investors exuded optimism amid fresh U.S. stimulus and the administration of coronavirus vaccines.
• The FTSE 100 in Europe closed flat, in the green 0.10% as traders weighed a Brexit trade deal approval from U.K. lawmakers this week.
• The S&P 500 in the United States gained 0.80% as investors were in buying mode after President Trump signed the $900 billion coronavirus stimulus package into law.

Read More: XRP Is a Crypto Asset in Japan, Not a Security, Ripple Partner SBI Claims

Commodities:

• Oil was down 1.3%. Price per barrel of West Texas Intermediate crude: $47.66.
• Gold was in the red 0.33% and at $1,872 as of press time.

Treasurys:

• The 10-year U.S. Treasury bond yield was down Monday dipping to 0.928 and in the red 0.18%.

• Crypto Long & Short: The Christmas Poem Edition
• Institutions Will Start Buying Ether in 2021, Messari Analyst Says

In a notice filed by the Securities and Exchange Commission Monday, the U.S. regulator declined to approve a rule change for tZero-backed BOX Exchange Inc., which intended to offer blockchain-based stock trade reporting.

• The proposal intended to have National Market System (NMS) stocks use BOX’s blockchain trading venue, also known as Boston Security Token Exchange LLC (BSTX).
• BOX initially filed the proposal Feb. 28, with multiple amendments added later. The exchange is a joint venture with tZero and began participating in security token offerings (STOs), blockchain-based security instruments, in 2018.
• The firm proposed using the Ethereum blockchain for recording and publishing end-of-day securities ownership balances, but did not specify how it would surveil and report transactions for compliance.
• The SEC’s major concern: Inaccurate information being published to the blockchain, as BSTX intended to use an “omnibus wallet” for non-BSTX stock transaction data, which the regulator feared could not stay up to date.

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OKCoin said Monday it will suspend XRP trading and deposits on its crypto exchange, effective on Jan. 4, 2021.

The exchange specified two key dates along the suspension timeline. “At 3 a.m. UTC time on January 4, the exchange’s users who have borrowed from the XRP/USD margin pair (including borrowing XRP and U.S. dollars) are required to return the borrowed value before this time at 3 a.m. UTC time on Jan. 4,” the exchange said. “Delays will trigger a liquidation by our systems to close the loan contracts.”

At 3 a.m. UTC on Jan. 5, XRP’s spot trading, margin trading and deposits will be suspended until further notice, according to the exchange.

Related: Coinbase to Suspend XRP Trading Following SEC Suit Against Ripple

“It is likely that this situation will take time to reach a resolution. We will proactively inform our customers when we have information that may change our position,” OKCoin said in the statement.

OKCoin became the latest exchange to delist XRP because of the U.S. Securities and Exchange Commission’s recent filing against Ripple Labs, alleging XRP is a security.

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Singapore-based lending platform Vauld raised $2 million, led by Pantera Capital, to grow into a full crypto bank. Other investors include Coinbase Ventures, LuneX Ventures and individual investors including Robert Leshner of Compound Finance.

This is part of a larger story of crypto firms seeking their own banking charters to operate as crypto-native banks. Recently, stablecoin issuer and crypto services firm Paxos and crypto payments firm BitPay filed to become federally regulated banks in the U.S.

So far, Vauld has established a foothold in India, where a favorable ruling from the courts earlier this year has unleashed a flood of crypto activity.

Related: Swiss Crypto Bank SEBA Raises $22.5M to Fuel Growth

“Hiring is the focus of the hour in the Indian market,” Vauld co-founder and CTO Sanju Sony Kurian said in a statement.

The company, formerly known as Bank of Hodlers, will use the funds to expand from lending and borrowing to become a holistic banking platform that also includes payments and trading. Vauld also seeks to broaden its presence in Europe and the U.S. 

“We see institutional capital come into the crypto space with the expectation of banking integrations to complement crypto credit offerings,” CEO Darshan Bathija said in a statement.

The company’s immediate aims include implementing an over-the-counter (OTC) desk, fiat and crypto order books, and debit and credit cards for multiple countries. The goal is for users to do all their banking on a blockchain.

Related: India’s Leading Bitcoin Exchange Raises $13.9M From Block.One, Coinbase Ventures

Vauld intends to expand licensing across international crypto hubs including Singapore and the U.K. in the next 24 months. Bathija told CoinDesk via Telegram his company is also looking at Wyoming following the precedent of Kraken Financial and Avanti Financial.

This comes after a year in which two banking charters were approved by the Wyoming State Banking Board, granting Kraken and Avanti official status as chartered banks in the state. Vauld sees higher demand for banking functionalities for crypto assets.

Bathija said most regulators want businesses to first prove they have the governance structure to operate in full compliance, given how new crypto companies are in general. They urge companies to get lending and money transmission licenses first and “wait for a year until we start applying for the banking license,” he said.

Since its earlier investment of $500,000 from LuneX Ventures and a few angel investors in June, Vauld saw 950% growth, according to the company. Bathija said that is a “clear indication that yield products are valued and expected both in the U.S. and abroad.” 

Investor Paul Veradittakit, partner at Pantera Capital, said in a press release his firm is excited about “Vauld’s vision to make cryptocurrencies the preferred instrument of banking by making it simple to use and interoperable with the current banking infrastructure.”

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Cover Protocol announced it’s exploring launching a new COVER token through a snapshot after its current one was abused in a minting attack by a “white hat” hacker on Monday morning.

The hacker, which could be an individual or a small group, claimed responsibility for an exploit in the decentralized finance (DeFi) insurance project, tricking the protocol into minting 40 quintillion COVER tokens. The hacker cashed out the tokens in other cryptocurrencies including ether, DAI and WBTC but later gave all the funds back to the protocol.

“The 4350 ETH that has been returned by the attacker will also be handled through a snapshot to the LP token holders. We are still investigating,” according to the project’s Twitter account urging its users not to buy any COVER tokens now.

Related: Who Insures the Insurer? Cover Protocol Attack Exposes DeFi’s Promise and Peril

Read more: Who Insures the Insurer? Cover Protocol Attack Exposes DeFi’s Promise and Peril

The development team behind Cover Protocol, which recently merged with Yearn Finance, is still investigating how exactly the hacker exploited its system. Sorawit Suriyakarn, chief technology officer at Band Protocol, said the attack appears to be related to a bug in the smart contract, where memory and storage were used incorrectly.

COVER token’s price has been on a wild ride over the last day, plummeting by over 75% to $177 on news of the hack before partially rebounding to over $240 after the hacker announced they’d returned the funds.

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