CoinDesk Crypto

Bitcoin has broken fresh 2020 highs as uncertainty remains in the U.S. presidential election.

• At around noon ET (17:00 UTC), the world’s oldest and most valuable cryptocurrency broke the $14,100 resistance level that had proved difficult to scale for the bulls four days prior on Oct. 31.
• As of this writing, bitcoin (BTC) was changing hands at around $14,166.25 after rebounding from Nov. 2 lows, near former resistance now confirmed as support at around $13,250.
• Over the past 24 hours, bitcoin has ranged between $13,545 and $14,223, according to CoinDesk 20 data.
• The difference in bitcoin’s price action compared to four years ago has been relatively small. Bitcoin’s price failed to react immediately after the 2016 election, rising a scant 1.8% in the 24-hour trading period. However, it is worth noting that roughly a year later, bitcoin climbed to its all-time highs above $19,660.

COMMENTARY: CoinDesk Covers the 2020 US Election and Crypto Impact

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Ethereum 2.0’s deposit contract is now live, heralding the imminent unveiling of the “world computer’s” second act.

Released at 15:00 UTC, according to developer Afri Schoedon, the deposit contract is the first physical implementation of Eth 2.0 for everyday users. The deposit contract acts as a bridge between the forthcoming proof-of-stake (PoS) blockchain and the current proof-of-work (PoW) mainchain, valued at some $40 billion by market capitalization. 

The genesis time for Eth 2.0 was first set for Jan. 3, the 12th anniversary of the launch of the Bitcoin network. The date has been moved, the GitHub file shows, to Dec. 1. After publication of this article, the deposit contract file was confirmed by an Ethereum Foundation blog.

Related: Ethereum Fees Plummeted 65% in October Following DeFi Volumes Back to Earth

“We’re all excited,” Ethereum 2.0 researcher Danny Ryan told CoinDesk in an October email. “This has been a long time coming, and countless researchers, engineers, and community members have put blood, sweat, and tears into this project. Feels good to finally bootstrap Ethereum’s long-awaited proof-of-stake consensus.” 

Read more: Everything You Need to Know About Ethereum 2.0

On a practical level, Ethereum stakers can now begin depositing the 32 ether (ETH) required to stake on Eth 2.0. Once 16,384 validators have deposited funds equivalent to a total of 524,288 ETH into the contract, the Beacon chain – the spine of Ethereum 2.0’s multiple blockchain design – will kick into action in what is called the “genesis” event of Ethereum 2.0. That event is expected within the next few weeks.

Stakers will begin earning inflation rewards after the genesis event by placing their ether as collateral on Eth 2.0. Staking rewards are reasonably high compared to other investments coming in between 8%–15% annually. And that’s for a good reason: Not only is there software risk, but the deposit contract to Eth 2.0 is a one-way bridge – at least for now.

Ethereum 2.0’s deposit contract launch: The next stage

Related: Ethereum Developers Pencil In January for Eth 1.x ‘Berlin’ Hard Fork

On a larger level, the deposit contract and soon-to-launch Beacon chain represent a critical step toward a future that Ethereum co-founder Vitalik Buterin foresaw some seven years ago: the creation of and need for a generalized, Turing-complete blockchain.

That vision has rolled out in stages, not to mention fits and starts. Buterin and other developers executed a four-part release of Eth 2.0: Frontier, Homestead, Metropolis and Serenity. 

Each successive phase added new features for the current mainchain and future PoS blockchain through what are called hard forks, or backwards-incompatible code alterations. 

For example, the latest Istanbul hard fork in January 2020 created a bridge for the Eth1.x blockchain to speak with equihash-based blockchains such as Zcash.

Read more: It’s Time to Launch the Ethereum 2.0 Beacon Chain

Serenity, the more formal name for Eth 2.0, is the most ambitious and contentious of the four hard forks. In fact, it’s being tackled in multiple parts: Phase 0 with the Beacon chain, phase 1 with sharding, Phase 1.5 with scaling improvements; and, if necessary, a final phase 2 (Although the latter two phases have yet to be entirely worked out).

Developers have conducted limited dry runs of phase 0 over the last year with single-client and multi-client testnets in an effort to nail the final launch, venture studio ConsenSys CEO Joe Lubin told CoinDesk in an email. The final testnet, Medalla, launched in September and has remained relatively stable.

“We’ve hardened Ethereum 2.0 as much as we can with simulated test environments, formal verifications, and audits. We are incredibly excited to see the community galvanize around the first phase of Eth2, now with real value at stake,” Lubin said.

But now all eyes rest on the mainnet deposit contract and Beacon chain, ConsenSys Eth 2.0 developer Ben Edgington told CoinDesk in a message.

“Deployment of the deposit contract is the point of no return for Eth2. We have no choice now but to see this thing through right to the end. After 2.5 years working on this, I am incredibly excited about where we are, and what’s yet to come,” Edgington said.

See Also: Report: Ethereum 2.0: How It Works and Why It Matters

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Bitcoin (BTC) was lower, searching for direction as uncertainty over U.S. election results hung over global markets. Prices were down about 2.2% to about $13,700, staying roughly in their range over the past week. 

With major states yet to be called in the U.S. presidential race and Republican incumbent Donald Trump accusing Democrats of trying to “STEAL” the election, the early read is that bitcoin prices are reflecting an increased likelihood of prolonged uncertainty or political gridlock that might hamper a quick economic recovery.

In traditional markets, yields on U.S. Treasury bonds fell by 0.11 percentage point, the most since April, signaling a shift toward risk aversion, or maybe a tempered expectation of outsize U.S. government borrowing. U.S. stock futures swung between gains and losses. The U.S. dollar was higher in foreign exchange markets. Gold weakened 0.7% to $1,895 an ounce. 

Related: Blockchain Bites: Ethereum 2.0’s Deposit Contract Goes Live as ETH Miner Revenues Dwindle

“With millions of votes in battleground states still being counted, it’s clear that the election is turning out to be messier and more drawn-out than Wall Street had hoped,” according to Bloomberg News.

Market moves

The U.S. presidential election is still in flux the morning after and might be for several days.  

In some ways, the prolonged uncertainty might have been entirely expected given how contentious the campaign has been, with a U.S. electorate that looks as divided as ever though apparently quite evenly split. But in other ways, the result was a short-term surprise for markets given investor expectations in recent weeks for a “blue wave” of Democratic victories that clearly did not materialize.

What’s known is that the lack of a clear verdict represents what many investors feared would be a worst-case scenario for global markets.  

Related: $14.1K: Bitcoin Breaks New 2020 High With US Election Still Undecided

Here are a few takeaways for what it means for bitcoin traders:

1) Crypto traders playing in prediction markets appear to see Democratic challenger and former Vice President Joe Biden heading for a win:  

2) The “reflation trade” – where investors expected a quick economic recovery with ample government stimulus – now appears less likely. Democrats held the U.S. House of Representatives and Republicans are expected to hold the U.S. Senate, which could lead to disagreement over the size of a multitrillion-dollar coronavirus stimulus package whoever wins the presidency. That might be bad for bitcoin, since many investors see the cryptocurrency as a hedge against inflation. Ian Shepherdson, chief economist at the forecasting firm Pantheon, told clients in an email early Wednesday: “With Republicans still in charge in the Senate, we’d be surprised to see a stimulus bill early next year much in excess of $500B, far less than the $2T we expected if Democrats had won.”

3) In some ways, the status of the presidential race appears in line with what many investors viewed as the worst-case scenario: an uncertain outcome with the potential to drag on. Trump says he wants the vote counting to stop, possibly seen as an admission that he suspects the final tally might reveal him to be a loser, and says he’s going to take the matter to the U.S. Supreme Court. Given Trump’s known combativeness and willingness to press for every advantage no matter how dubious, it could get ugly. That might mean markets trade for a while in a risk-off mood. In March, bitcoin prices tanked along with traditional markets when the initial coronavirus spread led investors to hunker down. 

4) Based on election night trading, it appears that crypto traders see a Biden win as more favorable for bitcoin than a Trump win. That might be due to the expectation that Trump’s protectionist trade policies and antagonism toward China would, all things being equal, lead to a strengthening of the U.S. dollar in the short term. “There appeared to be an inverse relationship between Trump’s winning odds and bitcoin’s price,” wrote the cryptocurrency-analysis firm IntoTheBlock.  

5) Market watchers may now start looking ahead to the Federal Reserve’s regularly scheduled meeting on Thursday. No action is expected, but Chair Jerome Powell might use the occasion to stress his readiness to intervene in markets if the election uncertainty causes investors to lose nerve. That could mean more stimulus, in a year when the Fed has already expanded its balance sheet by three-quarters to more than $7T. And investor expectations that the stimulus will eventually lead to inflation has helped bitcoin prices to almost double this year.

6) As chronicled by CoinDesk’s Nikhilesh De in an election-night live blog, several key crypto-friendly or at least crypto-familiar candidates won election to U.S. legislative seats. They included Senators Cynthia Lummis of Wyoming, Tom Cotton of Arkansas and Mark Warner of Virginia, as well as Representative Darren Soto of Florida. The races could have implications for crypto laws and regulations over the next several years as the industry matures. De’s primer on races to watch is here. 

Bitcoin watch

Bitcoin fell Wednesday alongside traditional markets after President Trump alleged “fraud” in the presidential election and pledged to stop vote counting.

The fall reversed a rally to $14,000 seen late on Tuesday, according to CoinDesk’s Bitcoin Price Index.

The cryptocurrency had begun losing ground during the early Asian trading hours after media reports projected a victory for Trump in key states such as Florida, dashing hopes for a Democratic sweep and a bigger fiscal stimulus package under Biden’s leadership.

But the latest assessment is that Biden likely wins if he carries two of the five states still too close to be called: Pennsylvania, Michigan, Wisconsin, Georgia and North Carolina, and prediction markets are giving him the nod. 

Bitcoin’s price sell-off accelerated as Trump’s threat to stop vote counting ramped up political uncertainty and sent a tremor through traditional markets. “We want the voting to stop,” Trump said without evidence. “This is a fraud on the American public. This is an embarrassment to our country.” 

That last statement might be one that all voters could agree on.

– Omkar Godbole

What’s hot

DeFi sell-off continues as index futures retrace to June levels (CoinDesk) 

Ethereum fees plumeted 65% in October, following DeFi volumes back to Earth (CoinDesk)  

Binance crypto exchange recovers $344K from scam DeFi project that launched on its platform (CoinDesk)  

Nearly $1B in bitcoin moves from wallet linked to Silk Road (CoinDesk)

Analogs The latest on the economy and traditional finance

Cruise-industry group extends suspension of U.S. operations through Dec. 31 (Reuters) 

Copper miner Freeport-McMoran, based in Phoenix, Arizona, considers getting rid of headquarters, arguing that staff are “showing we can get the work done remotely” (WSJ) 

Chinese President Xi Jinping says in high-profile speech to Communist Party’s Central Committee that country’s economy can double in size over next 15 years (Bloomberg) 

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Decentralized oracle platform Razor Network has raised $3.7 million in a seed funding round from NGC Ventures, Alameda Research, Spark Digital Capital and private investors including Mariano Conti, former head of oracles at MakerDAO.

“Mariano really understands what we’re doing,” said Razor Network founder and CEO Hrishikesh Huilgolkar in an interview. “He probably created the first oracle to ever go into production so he’s quite a good addition to our team.”

Huilgolkar, who was a software engineer at ConsenSys the past four years, acknowledges that most oracles systems today are centralized systems, which suffer from the usual problems associated with having a single point of failure. Of the current decentralized options, Chainlink has surged in popularity in recent months, with Decrpyt reporting this week that 29 projects integrated with Chainlink oracles last month alone.

Related: Alameda Research Invests $3M in 3Commas Crypto Trading Platform

“The oracle is arguably the most important piece of any DeFi application,” he said. “More importantly, the oracle needs to be fully permissionless to be secure.”

But is there room to compete with Chainlink in the current market? 

“There are so many different types of attacks on oracles we have to take into account and that’s the scary part,” Huilgolkar said. “For example, Chainlink got attacked a couple of months back and the validators lost a quarter-million dollars. We have to make sure that doesn’t happen and everyone is protected.”

Read more: Chainlink Up Nearly 1,000% Since ‘Black Thursday’ Crash

Related: NIFTEX Raises $500K to Build Out NFT Trading Platform

Huilgolkar said the Razor team is building towards a “truly decentralized oracle solution” with the new funding. He added that Razor developers have designed a dispute-resolution mechanism so that in the case of an attack, the attacker is sure to lose in the dispute round. This, he says, solves for the trade-off between speed and security of a fully decentralized system. 

Razor Network is set to launch in 2021 for developers to create “state-of-the-art dapps,” the firm said in a press release. Huilgolkar also said the upcoming launch of the first phase of Ethereum 2.0 “will actually make our job a lot easier.” 

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China’s UnionPay, the world’s biggest credit and debit card company, will support payments with a South Korea-developed cryptocurrency for an upcoming virtual card offering.

• Under a freshly inked deal, UnionPay has teamed up with Korean payments firm Danal to offer its Paycoin cryptocurrency as an option on the card, slated to launch later this year.
• According a report from the South China Morning Post on Wednesday, Danal said the prepaid virtual card will be available in the Paycoin wallet, allowing users to shop at over 30 million UnionPay-accepting merchants across 179 countries and regions, including China.
• The card will be able to be topped up with the digital coin and fiat currency.
• Launched last year, Paycoin is built on the Linux Foundation-led blockchain platform HyperLedger.
• It’s primarily used in South Korea and is available on exchanges such as Huobi, UpBit and CoinOne, according to the Paycoin website.
• While China has banned crypto trading platforms, owning and transacting with cryptocurrencies is not illegal in the country.

Also read: ATMchain? Card Giant China UnionPay Files New Blockchain Patent

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Cryptocurrency exchange Binance says it has successfully followed the money trail left by the operator of a scam decentralized finance (DeFi) project and recovered nearly all the stolen funds.

• In an announcement provided to CoinDesk on Thursday, Binance said it has gained custody of an estimated 99.9% of $345,000 worth of cryptocurrency stolen by purported automated market maker Wine Swap in October.
• Having raised the funds at launch on Binance Smart Chain in October, the operator fled with users’ cryptocurrency “within an hour,” Binance said.
• The so-called exit scam was executed by moving the 19 different cryptocurrencies held in Wine Swap’s address “0xa1eaB5F255DD77fED0D8ea81748422ca7ab0eDc4” to a personal address belonging to the bad actor: “0x4BA023aA9196a354C008aD595F67e268420b7005”.
• The various coins were moved via cross-chain transfers from Binance Smart Chain to Binance Chain and then to Ethereum, according to Binance.
• A small portion of the funds was moved to two exchanges, as well as Binance Bridge, a service that provides access to inter-blockchain liquidity for decentralized applications on Binance Chain and Binance Smart Chain.
• The Binance said its security team closely followed the transactions and managed to identify the malicious actor. By then, the scammer had nearly converted all of the funds into stablecoins, as well as Binance coin (BNB), ether (ETH) and Chainlink’s LINK token.
• After being contacted by Binance, the scammer returned the funds to the exchange.
• “Analysis of the transfers to and from Wine Swap allowed us to identify which addresses fell victim to the scam and calculate exactly how much was owed to them,” the exchange said.
• Binance now plans to refund the victims’ addresses “within the next several days.”
• Binance had seen some criticism over the fact that the scam project was launched on its platform.
• CoinDesk asked the exchange if it had reported the scammer to law enforcement, but a reply hadn’t been received by press time.

Also read: ‘I F**ked Up’: SushiSwap Creator Chef Nomi Returns $14M Dev Fund

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A wallet possibly belonging to early darknet market Silk Road moved almost $1 billion-worth of bitcoin early on Wednesday, according to blockchain intelligence firm Elliptic.

• Bitcoin address “1HQ3Go3ggs8pFnXuHVHRytPCq5fGG8Hbhx” transferred 69,369 BTC to an unknown wallet. The transaction was also noted by Twitter bot @Whale_alert 11 hours ago.
• “These funds likely originated from the Silk Road,” Tom Robinson, co-founder of Elliptic noted in a LinkedIn post, adding that the coins may have been moved by imprisoned Silk Road operator Ross Ulbricht or a Silk Road vendor.
• This is the first transaction from the address since 2015 when it transferred 101 BTC to BTC-e – a now-shuttered cryptocurrency exchange allegedly favored by money launderers, per the post.
• Ulbricht – who operated under the pseudonym Dread Pirate Roberts – operated the darknet market website Silk Road from 2011 until his arrest in 2013 and is currently serving a life sentence.
• As such, it’s highly unlikely that Ulbricht executed the transaction.
• The bitcoin trove left Silk Road’s wallet back on May 6, 2012, but may have been moved to stay up to date with changes to the Bitcoin network.
• Robinson said in the post that an encrypted file containing what are claimed to be the cryptographic keys to the coins have been circulating on hacker forums.
• If the password has been cracked, then a hacker may have moved the stash, or its owner moved them to avoid this happening.
• Silk Road, which combined two privacy-preserving technologies – bitcoin and Tor – to enable anonymous trade of illicit goods and services likely earned around 614,000 BTC in commissions.
• Of these, 174,000 BTC were seized from Ulbricht by the FBI when he was arrested in 2013.
• Robinson believes the remaining 440,000 bitcoins, now worth some $6 billion, may have been used by Ulbricht to fund expenses associated with running the marketplace.
• Big on-chain transactions related to malicious entities often raise concerns in the market. While bitcoin is down over 2% on the day at press time, those losses look to have been fueled by uncertainty around the U.S. election.

Also read: Silk Road Programmer Pleads Guilty to Making False Statements

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An Australian senator has come out as a big fan of blockchain, saying the technology could help facilitate government processes, tighten up financial regulation and more.

As reported by ZDNet on Wednesday, Andrew Bragg, senator for New South Wales, boldly said that “the future is technology by blockchain,” at the Future of Financial Services 2020 virtual conference.

“It may well be the solution to one-touch government with international transactions in real time,” said Bragg, a member of the Liberal party.

Related: JPMorgan’s ‘JPM Coin’ Is Live, Execs Say

The senator went on to suggest blockchain could help “eliminate ” the issue of Australia having several time zones.

Further, Bragg said the tech could streamline “regulatory processes,” save on compliance and administration costs, and help to rebuild “confidence and trust” in Australia’s financial services after the 2017 Royal Banking Commission investigation found shady banking and financial practices at major institutions in the country.

“We need to make it easier to become a global player,” he said, adding blockchain could be “a driver of future jobs and economic growth” within Australia.

See also: Australia to Spend $575M on Tech Including Blockchain to Boost Pandemic Recovery

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Bitcoin fell Wednesday alongside traditional markets after President Trump alleged “fraud” in the presidential election and pledged to stop some vote counting.

• Bitcoin was trading at $13,580 at time of writing, representing a 3.3% decline on the day. The fall reversed a rally to $14,000 seen late on Tuesday, according to CoinDesk’s Bitcoin Price Index.
• The cryptocurrency had begun losing ground during the early Asian trading hours after media reports projected a victory for U.S. President Donald Trump in key states such as Florida, dashing hopes for a Democratic sweep and a bigger fiscal stimulus package under former Vice President Joe Biden’s leadership.
• The sell-off accelerated in the last hour, with bitcoin extending losses from $13,730 to $13,530, as Trump’s threat to stop vote counting ramped up political uncertainty and sent a tremor through traditional markets.
• “We want the voting to stop. This is a fraud on the American public, this is an embarrassment to our country,” Trump said without evidence. “We were getting ready to win this election and, frankly, we did win this election.”
• S&P 500 futures are now trading 1% lower on the day. Nasdaq futures, are currently up just 0.8% compared to a 4% gain seen early today, according to data source Investing.com.
• The U.S. 10-year yield is now down near 23 basis points at 0.77% on increased haven demand for the government bonds. (Yields move in the opposite direction to bond prices).
• Trump claimed victory at an event held at the White House early today even though the vote count in states such as Michigan, Wisconsin, North Carolina, Nevada, and Pennsylvania is still not complete.

Also read: Here Are the 2020 US Election Races Crypto Should Watch

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Bitcoin fell Wednesday alongside traditional markets after President Trump alleged “fraud” in the presidential election and pledged to stop vote counting.

• Bitcoin was trading at $13,580 at time of writing, representing a 3.3% decline on the day. The fall reversed a rally to $14,000 seen late on Tuesday, according to CoinDesk’s Bitcoin Price Index.
• The cryptocurrency had begun losing ground during the early Asian trading hours after media reports projected a victory for President Trump in key states such as Florida, dashing hopes for a Democratic sweep and a bigger fiscal stimulus package under Biden’s leadership.
• The sell-off accelerated in the last hour, with bitcoin extending losses from $13,730 to $13,530, as Trump’s threat to stop vote counting ramped up political uncertainty and sent a tremor through traditional markets.
• “We want the voting to stop. This is a fraud on the American public, this is an embarrassment to our country,” Trump said without evidence. “We were getting ready to win this election and, frankly, we did win this election.”
• S&P 500 futures are now trading 1% lower on the day. Nasdaq futures, are currently up just 0.8% compared to a 4% gain seen early today, according to data source Investing.com.
• The U.S. 10-year yield is now down near 23 basis points at 0.77% on increased haven demand for the government bonds. (Yields move in the opposite direction to bond prices).
• Trump claimed victory at an event held at the White House early today even though the vote count in states such as Michigan, Wisconsin, North Carolina, Nevada, and Pennsylvania is still not complete.

Also read: Here Are the 2020 US Election Races Crypto Should Watch

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ND (00:00 ET): The majority of the seats we’re following in our top-15 races to watch have been called, and it’s looking like we won’t know the results from the presidential election until later this week at the earliest. (CNN currently has the tally at 205 for Biden to 114 for Trump.) Bitcoin’s price has remained fairly stable over the past few hours, though at $13,900 it’s still up close to 3.5% over the past 24 hours. We’re going to call it a wrap for the night and get back to it tomorrow. Thanks for hanging around. For CoinDesk, this is Nikhilesh De, Bradley Keoun, Sebastian Sinclair and Sandali Handagama. 

BK (23:53): Fox News calls Texas for Trump.

BK (23:44): Fox News calls Ohio for Trump.

Related: Here Are the 2020 US Election Races Crypto Should Watch

BK (23:43): Pennsylvania unlikely callable overnight in U.S. presidential election, Fox News says.

BK (23:32): Fox News calls New Mexico for Biden. Not a surprise.

BK (23:26): Fox News calls U.S. Senate race in Arizona for Mark Kelly, another flip for Democrats.

SS (23:25): Predictions markets point to win for Trump in Pennsylvania with @PolymarketHQ bettors pricing in a 64% chance while bettors at @PredictIt are giving it to the incumbent – 67%. Both markets heavily favor Trump to win the presidential race.

Related: First Mover: 11 Election Talking Points on Bitcoin as TRUMP Futures Point to Loss

BK (23:21 ET): Fox News calls Arizona for Biden; that’s a flip of 11 electoral votes won by Trump in 2016 and every other Republican since Clinton in 1996.

BK (23:16 ET): Republicans flip Alabama U.S. Senate seat from Democrats.

ND (23:15 ET): Sen. Kelly Loeffler (R-Ga.), the former Bakkt CEO appointed to the U.S. Senate late last year, will head to a runoff, likely in January, after no candidate in Georgia’s special election secured enough of the vote to declare victory. Doug Collins, a former Republican representative also running for the seat, conceded late Tuesday and will support Loeffler as she runs against Democrat Raphael Warnock.

BK (23:15 ET): Trump projected to win Florida, Fox News says.

BK (23:03 ET): CNN calls California, Oregon and Washington for Biden, Wyoming for Trump.

BK (22:57 ET): TRUMP futures on FTX crypto exchange have shot up to about 74 cents on the dollar from 35 cents over the past couple hours:

BK (22:49 ET): Biden wins Illinois, Trump Missouri: CNN.

BK (22:40 ET): CNN calls New Hampshire for Biden; Louisiana, Kansas, Utah, Nebraska for Trump. Electoral tally so far: Biden 98, Trump 95.

SS (22:04 ET):  Betting on Polymarket suggests Trump has 91% chance of winning Texas.

SS (22:00 ET): In the last hour, bettors at Polymarket have President Donald Trump winning the election $0.59 to Biden’s $0.41 up from $0.44 and $0.56 respectively.

ND (21:55 ET): Some prediction markets appear to be swinging toward Trump. The four decentralized markets CoinDesk tracked pretty consistently indicated that Biden would win; late Tuesday night, Augur flipped, as did FTX’s TRUMP and BIDEN tokens.

BK (21:55 ET): CNN calls U.S. Senate seat in Colorado for former Governor John Hickenlooper, flipping Republican seat to Democratic.

BK (21:30 ET): CNN Projects South Carolina, Alabama for Trump. No surprise.

BK (21:30 ET): CNN projects Colorado for Biden. No surprise.

ND (21:20 ET): Cynthia Lummis just won her race for a Senate seat representing Wyoming. This isn’t a surprise – she was clearly favored in the polls once she won her primary race this past summer – and there’s a lot of hope from the crypto industry that she’ll be a hardcore advocate for the space.

BK (21:15): CNN projects Connecticut for Biden, South Dakota for Trump. No surprise.

BK (21:13): CNN making point that Ohio and North Carolina both leaning blue at the moment, could spell trouble for Trump if those hold.

SS (21:09): In the last two hours predictions markets have begun to narrow: Biden at 55% to Trump’s 45%. Next key battleground state, assuming Trump takes for Florida, is Arizona where bettors have flipped Republican in past hour.

BK (21:05 ET): CNN projects New Jersey for Biden, Arkansas for Trump. No surprise.

BK (20:53 ET): Next big slug of polls close in 7 minutes.

SS (20:40 ET): Crypto predictions platform Polymarket is beginning to flash some interesting results. According to the platform, there is now a 93% chance Trump takes Florida, with predictions paying $0.93 to the Republicans and $0.70 for the Democrats.

“Two stand outs: Pennsylvania is leaning to the Democrats while Texas is leaning heavily to Republicans with 85%,” said Shayne Coplan, founder and CEO of Polymarket. 

Other crypto predictions markets are struggling to keep pace as predictit.org and electionbettingodds.com have gone dark. Another interesting prediction is “will Donald Trump tweet announcing that he won the election before November 5th 2020?” Currently 55% of respondent are betting that is unlikely, though the margins are close.

ND (20:40 ET): So far, Rep. Darren Soto (D-Fla.) and Senators Tom Cotton (R-Ark.) and Mark Warner (D-Va.) have won re-election, to no surprise. Soto is perhaps the most enthusiastic about blockchain of the three, introducing a number of bills aimed at integrating blockchain with government efforts. Warner is more of a Libra skeptic, while Cotton believes the U.S. should create a central bank digital currency to prevent China from displacing the dollar as the world reserve currency.

ND (20:35 ET): PredictIt is still down.

ND: Hello CoinDesk readers and welcome to our live coverage of the 2020 election results. Today Nikhilesh De, Bradley Keoun, Sandali Handagama and Sebastian Sinclair will be bringing you real-time updates as the elections are called for lawmakers important to our industry, as well as keeping you up to speed on what the prediction and futures markets are saying. 

We’ll be tracking the price of Bitcoin through the night to see if traders are also watching this election or if any particular outcomes have an impact on movement.

Bitcoin’s price did not react at all to the 2016 election, rising a scant 1.8 percent in the 24-hour trading period, and given the crypto industry’s overall lack of engagement in this election, there’s no reason to believe this might change in 2020.

Of course, it is worth noting that Bitcoin embarked on the famous 2017 bull run just months after the election, rising to all-time highs close to $20,000 within a year and giving birth to an initial coin offering boom that regulators are still investigating and conducting enforcement actions against nearly three years later. At the moment, Bitcoin is slowly rising, hitting a nearly two-year high of $14,000 just the other day. And since the last election, its price has grown 19-fold.

Still, comparing the crypto industry now to the industry in 2016 would be foolish at best. The market has matured in many ways, with the U.S. space at least seeing the introduction of futures contracts and a greater number of regulated entities. Regulators have likewise gained a better understanding of the space, introducing new regulations or clarifying how cryptocurrencies fit into existing frameworks – to an extent. 

The winners of this year’s election will get to decide how regulators are to proceed and whether new legislation is passed. CoinDesk will be here providing updates to watch it all unfold.

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• The Crypto Industry Remains Mostly Unengaged in Election 2020
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BK (20:53 ET): Next big slug of polls close in 7 minutes.

SS (20:40 ET): Crypto predictions platform Polymarket is beginning to flash some interesting results. According to the platform, there is now a 93% chance Trump takes Florida, with predictions paying $0.93 to the Republicans and $0.70 for the Democrats.

“Two stand outs: Pennsylvania is leaning to the Democrats while Texas is leaning heavily to Republicans with 85%,” said Shayne Coplan, founder and CEO of Polymarket. 

Related: Here Are the 2020 US Election Races Crypto Should Watch

Other crypto predictions markets are struggling to keep pace as predictit.org and electionbettingodds.com have gone dark. Another interesting prediction is “will Donald Trump tweet announcing that he won the election before November 5th 2020?” Currently 55% of respondent are betting that is unlikely, though the margins are close.

ND (20:40 ET): So far, Rep. Darren Soto (D-Fla.) and Senators Tom Cotton (R-Ark.) and Mark Warner (D-Va.) have won re-election, to no surprise. Soto is perhaps the most enthusiastic about blockchain of the three, introducing a number of bills aimed at integrating blockchain with government efforts. Warner is more of a Libra skeptic, while Cotton believes the U.S. should create a central bank digital currency to prevent China from displacing the dollar as the world reserve currency.

ND (20:35 ET): PredictIt is still down.

ND: Hello CoinDesk readers and welcome to our live coverage of the 2020 election results. Today Nikhilesh De, Bradley Keoun, Sandali Handagama and Sebastian Sinclair will be bringing you real-time updates as the elections are called for lawmakers important to our industry, as well as keeping you up to speed on what the prediction and futures markets are saying. 

Related: First Mover: 11 Election Talking Points on Bitcoin as TRUMP Futures Point to Loss

We’ll be tracking the price of Bitcoin through the night to see if traders are also watching this election or if any particular outcomes have an impact on movement.

Bitcoin’s price did not react at all to the 2016 election, rising a scant 1.8 percent in the 24-hour trading period, and given the crypto industry’s overall lack of engagement in this election, there’s no reason to believe this might change in 2020.

Of course, it is worth noting that Bitcoin embarked on the famous 2017 bull run just months after the election, rising to all-time highs close to $20,000 within a year and giving birth to an initial coin offering boom that regulators are still investigating and conducting enforcement actions against nearly three years later. At the moment, Bitcoin is slowly rising, hitting a nearly two-year high of $14,000 just the other day. And since the last election, its price has grown 19-fold.

Still, comparing the crypto industry now to the industry in 2016 would be foolish at best. The market has matured in many ways, with the U.S. space at least seeing the introduction of futures contracts and a greater number of regulated entities. Regulators have likewise gained a better understanding of the space, introducing new regulations or clarifying how cryptocurrencies fit into existing frameworks – to an extent. 

The winners of this year’s election will get to decide how regulators are to proceed and whether new legislation is passed. CoinDesk will be here providing updates to watch it all unfold.

Related Stories

• The Crypto Industry Remains Mostly Unengaged in Election 2020
• Bitcoin’s Implied Volatility Rises Ahead of US Election

Crypto may not yet be considered an institutionalized asset class — but it’s getting closer.

Index futures for decentralized finance (DeFi) continue to collapse, erasing all gains since late June, as the sector cools off following a wild summer of speculation. 

On derivatives exchange FTX, perpetual futures for their DeFi index have fallen nearly 60% from their September high of $3,500, dropping to prices not seen since shortly after the new futures product launched at the end of June. 

On Binance, futures for a similar index have plummeted nearly 70% off its Aug. 28 high of $1,190, made the same day when the product started trading. Since its launch, the index has largely only traded downward, closing every week, except for three, at a loss.

Related: Alameda Research Invests $3M in 3Commas Crypto Trading Platform

A temporary respite may be near, however, offering investors a chance to recover and reevaluate the market, according to Alex Gedevani, analyst at Delphi Digital and former analyst at Barclay’s. The speed of the ongoing sell-off has simply caught many investors “off-guard,” he told CoinDesk. 

In Gedevani’s view, the altcoin market is “inching closer” to a capitulation event, at which point the sector can start to “gradually recover.” But a “fresh narrative” is needed to reignite capital inflows to the space, he added. 

Since the start of September, bitcoin has gained 18% and outperformed every top alternative cryptocurrency (altcoin) in the CoinDesk 20 index. In part, this performance is due to traders rotating investment capital from altcoins into bitcoin, as CoinDesk previously reported. 

Bitcoin has been a “black hole sucking up capital from investors looking to cash in on gains from the DeFi summer,” said Jack Purdy, decentralized finance analyst at Messari, in a direct message with CoinDesk. These investors picked bitcoin since it “appears overwhelmingly bullish amid this macroeconomic backdrop,” he said. 

Related: The 2020 Elections Are Boosting Crypto Prediction Markets

Some DeFi projects won’t see a gradual recovery though. Newer projects launched this summer “without clear value propositions will continue to see downside” with investors consolidating into stablecoins or bitcoin, Gedevani said.

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Miners’ income from processing transactions on the Ethereum blockchain more than halved in October as the mania for decentralized finance (DeFi) cooled.

• Ethereum users paid $57.49 million in transaction fees in October – down 65% from September’s record monthly tally of $166.39 million, according to data source Glassnode.
• “Transaction costs declined as volumes on decentralized exchanges dropped, reducing demand for network’s bandwidth,” Alex Mashinsky, CEO and founder of crypto lender Celsius, told CoinDesk.
• Trading volume on decentralized exchanges fell by nearly 25% to $19.4 billion in October to register the first monthly decline since April. The majority of decentralized exchanges (DEXs) are based on Ethereum.
• Further, the maximum “gas” price – paid by participants to transact on Ethereum – declined from 5.18 million gwei to 0.6 million gwei in October, according to data source Bitquery. (A gwei is a billionth of 1 ether.)
• The sharp drop indicates there was less aggressive bidding by market participants for running transactions on the network, according to Denis Vinokourov, head of research at London-based prime brokerage Bequant.

• Total fees paid had surged from $22 million to $166 million in Q3, as the DeFi space witnessed explosive growth following the launch of COMP governance token by the lending protocol Compound in June.
• Such was the activity in September that ether miners earned over six times more in fees than bitcoin miners.
• And while ethereum miners earned significantly less from fees in October, they still made more than the bitcoin miners, who collected $41.20 million in fees.

Also read: Record $166M Ethereum Fees Last Month Were 6 Times Bigger Than Bitcoin’s

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Bitcoin miner Layer1 Technologies has been dragged into a lawsuit from a co-founder who claims he invested millions of dollars and was then forced out of the firm.

In a complaint filed in the District Court in the Western District of Texas Pecos Division, the plaintiff, Jakov Dolic, sets out that he co-founded Layer1 with its CEO Alexander Liegl, having developed a liquid cooling system that would allow the company to make use of Texas’ cheap wind power, despite the high summer temperatures in the state.

Dolic, a German citizen residing in Switzerland, alleges that Liegl “falsely promised” that he would be able to raise $50 million from investors for a “large bitcoin mining operation.”

Related: Bitcoin’s Mining Difficulty Sees Largest Percentage Drop in 9 Years

However, the investments didn’t arrive, per the complaint, so Dolic claims he spent $16.24 million of his own funds to purchase of a Ward County, Texas, power substation from a firm called Hodl Ranch, as well as a further $3.5 million to expand the power facility. Dolic claims he had an agreement with Leigl that Layer1 would refund him the money.

Per the allegations, Dolic didn’t receive anything for his investment, while Liegl “took legal title to the properties.” Further, the plaintiff claims, after he confronted Liegl over “unauthorized and wasteful spending of Layer1’s funds,” he was “pressured” out of the company.

The complaint alleges Liegl had been “paying himself significant ‘consulting’ fees without Dolic’s knowledge or authorization.”

Further, the plaintiff claims that Layer1 faced a funding crunch, having failed to garner sufficient investment and had decided to sell the substation at a “fire sale price,” and “before Dolic can protect his rights.”

Related: Bitcoin Mining Firm Hut 8 Appoints Jaime Leverton as CEO

With the lawsuit, Dolic – who founded Genesis Mining in 2013 – aims to assert his “rights to the properties that he bought directly from the seller,” even though Layer1 “technically” has ownership of the title.

“”The complaint is completely meritless and contains numerous allegations that are demonstrably and categorically false,” Liegl told CoinDesk. “The company will be responding quickly to seek legal sanctions against Dolic and his counsel for making false allegations that lack a reasonable basis.”

“There are simply no plans, and there never were any, to sell the substation,” he added.

Layer1 is a Delaware Corporation working out of California that sets out to mine bitcoin using wind power. The firm has seen investment from Peter Thiel, Shasta Ventures and CoinDesk’s parent firm Digital Currency Group.

As CoinDesk reported in August, Layer1 was accused by a team member of misdescribing the role of a supposed core team member in a pitch deck for investors.

Edit: Corrected location of substation to Ward County, Texas.

Also read: Bitcoin’s Mining Difficulty Sees Largest Percentage Drop in 9 Years

See the full complaint below:

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Bitcoin miner Layer1 Technologies has been dragged into a lawsuit from a co-founder who claims he invested millions of dollars and was then forced out of the firm.

In a complaint filed in the District Court in the Western District of Texas Pecos Division, the plaintiff, Jakov Dolic, sets out that he co-founded Layer1 with its CEO Alexander Liegl, having developed a liquid cooling system that would allow the company to make use of Texas’ cheap wind power, despite the high summer temperatures in the state.

Dolic, a German citizen residing in Switzerland, alleges that Liegl “falsely promised” that he would be able to raise $50 million from investors for a “large bitcoin mining operation.”

Related: Bitcoin’s Mining Difficulty Sees Largest Percentage Drop in 9 Years

However, the investments didn’t arrive, per the complaint, so Dolic claims he spent $16.24 million of his own funds to purchase of a Ward County, North Dakota, power station from a firm called Hodl Ranch, as well as a further $3.5 million to expand the power facility. Dolic claims he had an agreement with Leigl that Layer1 would refund him the money.

Per the allegations, Dolic didn’t receive anything for his investment, while Liegl “took legal title to the properties.” Further, the plaintiff claims, after he confronted Liegl over “unauthorized and wasteful spending of Layer1’s funds,” he was “pressured” out of the company.

The complaint alleges Liegl had been “paying himself significant ‘consulting’ fees without Dolic’s knowledge or authorization.”

Further, the plaintiff claims that Layer1 faced a funding crunch, having failed to garner sufficient investment and had decided to sell the power plant at a “fire sale price,” and “before Dolic can protect his rights.”

Related: Bitcoin Mining Firm Hut 8 Appoints Jaime Leverton as CEO

With the lawsuit, Dolic – who founded Genesis Mining in 2013 – aims to assert his “rights to the properties that he bought directly from the seller,” even though Layer1 “technically” has ownership of the title.

“”The complaint is completely meritless and contains numerous allegations that are demonstrably and categorically false,” Liegl told CoinDesk. “The company will be responding quickly to seek legal sanctions against Dolic and his counsel for making false allegations that lack a reasonable basis.”

“There are simply no plans, and there never were any, to sell the substation,” he added.

Layer1 is a Delaware Corporation working out of California that sets out to mine bitcoin using wind power. The firm has seen investment from Peter Thiel, Shasta Ventures and CoinDesk’s parent firm Digital Currency Group.

As CoinDesk reported in August, Layer1 was accused by a team member of misdescribing the role of a supposed core team member in a pitch deck for investors.

Also read: Bitcoin’s Mining Difficulty Sees Largest Percentage Drop in 9 Years

See the full complaint below:

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• Bitcoin Miners Saw 8% Revenue Increase in October
• Bitcoin Transaction Fees Rise to 28-Month High as Hashrate Drops Amid Price Rally

Sam Bankman-Fried’s Alameda Research has invested $3 million in trading platform 3Commas.

“We had offers from other bigger names in the space as well,” founder and CEO Yuriy Sorokin told CoinDesk in an interview, “but I love Sam because he talks straight to the point compared to these other Western negotiators.”

Sorokin’s platform launched three years ago out of Tallinn, Estonia, to bring a simple crypto investing and trading experience for retail users. Sorokin said the lack of understanding and access to professional trading tools for retail investors is an even bigger problem today as crypto is trending toward greater adoption. 

Related: Decentralized Exchange Volume Dropped 25% in October

“That’s why we chose Alameda to be our [sole] investor,” said Sorokin. “They were the first who tried to bring social trading or third-party trading tools directly to the exchanges.”

Read more: FTX Is Building Lots of Sophisticated Markets Few Traders Use

Bankman-Fried, founder and CEO of Alameda Research and FTX Exchange, said in a press release, “We are perfectly aligned in our mission to increase crypto adoption and offer an amazing experience utilizing 3Commas technology.” 

The platform currently has 100,000 active traders, according to Sorokin.

Related: FTX Raises ‘TRUMP’ Futures Margins as Price Suggests Lower Expectations of Election Win

In the past year, 3Commas has launched a number of bots that enable users to select from a series of pre-determined trading strategies, leave their assets on autopilot and get notified when a trade is completed. 

“Trading crypto is hard,” said Victor Cucos, 3Commas’ chief strategy officer. “Newcomers with FOMO will jump into the space with no idea how to manage any sort of assets.”

Upcoming initiatives from the company include building 3Commas Academy, an online education program for new users to learn the basics of trading and risk management, the firm said. It also plans to expand with localized services in Asia and South America to grow its community in other languages. 

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Big payments players may be dipping their toes into crypto for the first time, but it’s been part of Visa’s Fast Track program since at least 2019.

Announced Tuesday, Visa has invited digital asset wallet provider ZenGo into its Fast Track program. The startup hopes to use the program, which has famously championed Bitcoin’s Lightning Network and rewards app Fold, to help launch a crypto-integrated payment card for the U.S. in early 2021.

Crypto apps are the flavor of the month, with PayPal joining Square, Robinhood, Revolut and Ziglu, who are all competing in this space. ZenGo CEO Ouriel Ohayon talked up the non-custodial aspect of the Visa-backed card, which he says sets it apart from the likes of PayPal.

Related: PayPal Raises Crypto Buying Limit to $15K/Week for ‘Eager’ Customers

“Those other offerings are only a half-vanilla taste of what crypto is because they only let you own an IOU over a cryptocurrency,” Ohayon said in an interview. “This is the only one that is tied to a user-controlled wallet where the users have control of their funds and the funds are on-chain.”

Visa clearly sees the value in linking crypto services to plastic cards, having just tied up a deal involving peer-to-peer digital asset marketplace Paxful. Meanwhile, Coinbase is also launching its Visa-branded crypto debit card in the U.S. early next year.

Read more: Coinbase to Launch Crypto Debit Card in US for Retail Spending

The ZenGo payment card allows users to convert their cryptocurrency into fiat so it can be spent in the Visa network and withdrawn from ATMs. The wallet uses a clever technique called multi-party computation (MPC), which breaks up long cryptographic keys and can be leveraged to create a more conducive user experience. According to ZenGo, MPC saves customers from having to write down private keys or remember passwords, and protects them even if their phone is lost or stolen. 

Related: Coinbase to Launch Crypto Debit Card in US for Retail Spending

“As the preferred network for digital currency wallets, we are excited to help innovative fintechs like ZenGo harness the value of Visa’s network,” Cuy Sheffield, head of crypto at Visa, said in a statement. “Through the Fast Track program, we can support ZenGo with access to Visa’s experts, technology, and resources to scale with efficiency.” 

Read more: PayPal Embraces Crypto, Igniting Market as Mainstream Adoption Inches Closer

When it comes to integrating crypto with a network of merchants or point-of-sale payments infrastructure, Visa-backed cards are not remarkably different from PayPal’s claim about connecting to some 20 million-plus online merchants. Both offerings involve converting crypto to fiat to make a transaction.

But the ZenGo app is much more about current utility than future speculation, Ohayon said.

“We see a growing number of people who want to use cryptocurrency for their daily lives,” he said. “Just going and buying some from Robinhood to speculate is not what they want. We have real estate agents who get paid in cryptocurrency, we have photographers, DJs, independent workers of all sorts. Those guys want to be able to spend it.”

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Singapore-based NIFTEX, the platform that allows for the fractional trading of non-fungible tokens (NFTs), announced a $500,000 funding round led by 1kx and joined by CoinFund, MetaCartel Ventures and Digital Currency Group (CoinDesk’s parent company).

The company launched its alpha version five months ago and has generated more than $2 million in total volume, co-founder and CEO Joel Hubert told CoinDesk in an interview. He said the early uptake “proves we’re doing something people find interesting.” 

NIFTEX has been seen as a factor in the resurgent popularity of digital collectibles, inspired in part by this summer’s decentralized finance (DeFi) craze. “Perhaps spurred by the DeFi Summer, NFTs are undergoing a second discovery cycle,” Hubert said.

Related: DefiDollar Raises $1.2M to Be the Risk-Insured Stablecoin Layer for DeFi

With the funding, Hubert and co-founder Mark Le have ambitions to turn NIFTEX into a more solidified platform for anyone with an NFT to walk in and leave with something to trade (without sacrificing ownership of the original work).

“I see from crypto people regarding NFTs [with] the same type of skepticism I see from people outside of crypto looking at bitcoin,” Hubert said. “Trading NFTs is hard, especially compared to a cryptocurrency that is fungible.”

Read more: The Inevitable Marriage of Yield Farming and NFTs, Explained

That’s where the innovation to fractionalize expensive NFTs into ERC-20 tokens really kicked off, Hubert added. After all, collectibles are cool, but so is making money.

Related: Notional Launches Out of Stealth to Bring Fixed-Rate Lending to DeFi

“With NFTs, digital scarcity is here, and it’s here to stay,” Larry Sukernik, investment chief at  Digital Currency Group, said in a press statement. “Just like we buy and sell fractions of companies and real-estate, so can we buy and sell fractions of digital assets. It’s a wonky idea at first, but the longer you think about it, the more it makes sense.”

In an interview, Hubert also hinted at a “master plan” to design and build a second version of the platform, moving toward a fully decentralized NIFTEX – presumably with a governance token – in early 2021.

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