Top Stories of Last Week
- Recently appointed deputy governor of People’s Bank of China Li Bo reportedly spoke on benefits of crypto as investment tool while highlighting regulatory uncertainty in comments at Boao Forum. PBoC head said there are still regulatory risks for central bank, but that PBoC seemed to recognize the investment potential of crypto, saying “we believe that crypto assets should play a major role in the future, either as an investment tool or as an alternative investment.”
- Bank of England and HM Treasury jointly created taskforce to explore potential CBDC in U.K. Two government authorities will explore use cases and risks and also evaluate design features of CBDC and monitor international CBDC developments to ensure U.K. “remains at the forefront of global innovation.” CBDC taskforce will be co-chaired by Bank of England’s deputy governor for financial stability Jon Cunliffe and HM Treasury’s director general of financial services Katharine Braddick.
- U.S. House of Representatives passed legislation on digital assets known as Eliminate Barriers to Innovation Act of 2021, which seeks to set up digital asset working group with representatives from SEC and CFTC. Purpose of group is to “ensure collaboration between regulators and the private sector” to foster innovation. Under terms of bill, Congress is to create working group within 90-day period from date of bill’s passing, with overarching goal to clarify when SEC has jurisdiction over digital assets and when CFTC has final say.
- Miners have raised Ethereum’s gas limit to almost 15 million for first time in bid to relieve transaction congestion. Before increase, Ethereum’s gas limit was set at 12.5 million until Vitalik Buterin suggested raising it last week in light of recent code optimizations activated on network. This is seventh time in Ethereum’s history that miners have voted to increase gas limit.
- Trading tech firm X-Margin and custody provider Fireblocks working to standardize fragmented state of lending and borrowing of digital assets for institutional trading. First users of institutional credit sourcing platform are Celsius and crypto hedge fund Dunamis Trading. X-Margin Credit system allows fund’s risk profile to be made available based on all positions it has across venues using anonymous data thanks to zero-knowledge proofs, so lender is not privy to whole trading strategy.
- Signature Bank announced as leading financial institution for Circle’s USDC reserve deposits. As part of partnership, Circle will be integrated into Signature’s blockchain-based real-time payments platform, Signet, which will allow for future integrations of Circle products and services within bank.
- Citi’s “Future of Money” report stated Diem could become white label central bank digital currency provider, serving as infrastructure layer on top of that provided by public sector via CBDCs. Diem white paper states it is “open to having a discussion with any central bank [that] would be interested in adding [its] currency as a stablecoin on [Diem’s] network.”
- Tether launched on Hermez Network, an Ethereum scalability solution based on zk-rollup concept, in hopes to alleviate pressure on Ethereum gas fees, where Tether contract is consistently among highest gas users. Hermez provides Ethereum-native alternative to Tron and can currently be accessed using MetaMask.
- API3, a data oracle service, entered into 10-year development partnership with Open Bank Project to merge over 400 banking APIs with blockchain smart contracts, Web 3.0 applications and DeFi. API3’s “Airnode” infrastructure adds blockchain and decentralized apps into fintech’s mix of Web 2.0 and mobile applications that use Open Bank.
- Conflux, a public blockchain endorsed by Shanghainese government, launching cross-chain bridge to facilitate easier operations among Binance, OKEx and Huobi as well as Ethereum. Cross-chain bridge called ShuttleFlow will enable digital asset swaps between Conflux network, Ethereum, Binance Smart Chain, Huobi ECO Chain and OKex Chain.
- Galaxy Digital reportedly in advanced discussions to buy BitGo, the crypto custody specialist. BitGo was reported to have been in acquisition talks with PayPal last year, but no deal was reached even though PayPal offered as much as $750 million in cash. Details of deal are unclear at this stage, but traditional financial firm is alleged to be involved alongside Galaxy.
- Purpose Investments and CI Global Asset Management both received approval in Canada to launch ETF that offers exposure to Ether. Purpose Ether ETF and CI Galaxy Ethereum ETF will list on Toronto Stock Exchange.
- WeWork announced it is accepting cryptocurrency as form of payment and Coinbase will be first member company to use cryptocurrency as payment for membership. WeWork said it will also hold currency on balance sheet and pay landlords and third-party partners in cryptocurrencies using Coinbase.
- Baillie Gifford, a U.K. asset manager with $445.3 billion in assets under management, invested $100 million in Blockchain.com, one of Baillie Gifford’s first investments in crypto space.
- BitGo expanded custodian’s insurance program by a further $600 million for a total of over $700 million in insurance coverage for cryptocurrency, including the original $100 million in cover for all customers using its platform. BitGo also offering clients ability to top up insurance by purchasing their own dedicated limits. BitGo’s crypto insurance is sourced from the Lloyd’s of London market.
- First Foundation, the publicly traded company that counts a bank and financial advisory firm among its subsidiaries, made undisclosed strategic investment in NYDIG. First Foundation will also work with investment firm to provide clients with bitcoin-related products.
- RIT Capital Partners, formerly known as Rothschild Investment Trust, acquired interest in Kraken, according to note to investors that announced investment but did not mention size nor amount paid.
- Morgan Stanley’s FS NYDIG Select Bitcoin Fund LP raised $29.4 million from 322 investors in first 14 days, according to regulatory documents. Average investment in Morgan Stanley’s new bitcoin fund was around $91,000.
- NYDIG has bought commercial lender Arctos Capital, which provides financing solutions to bitcoin miners and other crypto firms, to extend reach across institutional Bitcoin landscape. Terms of deal were not disclosed.
- Digital asset manager 3iQ Corp aims to raise over $200 million in proceeds from dual listing of 3iQ Coinshares Bitcoin ETF in Dubai, with listing on Nasdaq Dubai exchange expected. 3iQ’s ETF is first cryptocurrency fund to go public in Middle East and company received regulatory approval for dual listing earlier this week.
- Former top banking regulator Brian Brooks set to become CEO of Binance.US, according to Wall Street Journal report stating Brooks will join crypto exchange on May 1. Brooks, a former Coinbase executive, was recently acting head of Office of the Comptroller of the Currency under the Trump administration. He will replace Catherine Coley, current CEO of Binance.US.
- Coinbase will list Tether’s USDT on professional trading platform Coinbase Pro, allowing investors to deposit dollar-pegged stablecoin and begin trading next week. USDT is listed on Kraken and Binance.US exchanges, but Coinbase is subject to closer regulatory scrutiny, having gone public last week on Nasdaq.
- Binance has attracted attention of regulators for selling “stock tokens” designed to track performance of shares in companies like Coinbase and Tesla. U.K. Financial Conduct Authority and German regulator BaFIN did not confirm whether investigation into tokens was underway, but said if “tokens… (might) represent securities and are subject to the obligation to publish a prospectus.” Binance says products are compliant with European Union’s Mifid II markets rules and BaFin’s banking regulations.
- Dapper Labs is allegedly raising more money at new valuation of more than $7.5 billion. Reports say new round is being led by Coatue Management, which led previous round.
- Aleo announced $28 million fundraising round led by a16z with participation from Placeholder VC, Galaxy Digital, Variant Fund and Coinbase Ventures, among others. Aleo web platform leverages zero-knowledge proofs to keep privacy at core of whatever apps are developed. Funding accompanied by launch of Aleo’s Developer Preview II, a line of new tools for developers to build on Aleo ahead of public launch of network.
- Digital Asset Holdings raised $120 million in Series D funding round from 7Ridge and Eldridge. Digital Asset aiming to expand team by 50% this year and introduce new interoperability protocol. Firm’s core product, the open-source DAML smart contract language, works on both blockchains and centralized databases for synchronizing data, with clients including ASX, BNP Paribas, and Hong Kong Exchanges and Clearing, among others.
- DMG Blockchain Solutions purchased 3,600 bitcoin mining machines, and expects order to push hashrate to over 500 PH/s. DMG will receive first shipments of ASIC miners August, with final batch coming next August.
- Canaan Creative to supply 11,760 Bitcoin mining machines to Mawson Infrastructure Group Inc., formerly known as Wize Pharma, shipping and installing A1246 ASIC AvalonMiners for Mawson Infrastructure throughout 2021.
Defi / NFT
- Sotheby’s first NFT sale of works by pseudonymous artist Pak fetched $16.8 million over three-day drop. Notable pieces in Pak collection included “The Pixel,” an NFT consisting of single pixel that sold for $1.36 million.
- LVMH, Prada and Cartier unveiled Aura Blockchain Consortium, a collective effort to give shoppers a level of assurance that products being purchased are authentic. LVMH enlisted full-time blockchain team under Aura codename to develop cryptographic provenance platform for luxury market. Team worked with ConsenSys on project. Hublot, Bvlgari and Louis Vuitton are already active on platform.
- EasyFi, a DeFi Polygon Network-powered protocol, reported suffering hack of over $80 million. Blog post by CEO Ankitt Gaur said hacker transferred out 2.98 million EASY tokens, worth total of around $75 million. Also removed was $6 million from liquidity pools in dai and tether. Private keys to network admin MetaMask account had been compromised, but EasyFi smart contracts were not exploited. Guar also confirmed plans for hard fork to recover funds are in works.