Top Stories of Last Week

Regulatory

  • Bank of Japan launched a proof of concept for its CBDC, following initial preparations to test technical feasibility of core CBDC functions and features in early 2021. Bank plans to develop test environment for CBDC system and conduct experiments on basic functions related to payment, issuance, distribution and redemption of CBDC. Phase is expected to be completed by March 2022. 
  • Bank of Thailand announced they will begin piloting retail CBDC in second quarter of 2022. Thailand’s central bank assistant governor said they are open to accepting public feedback by 15 June this year, with bank planning to fully implement currency over next 3-5 years.
  • Former SEC Chairman Jay Clayton said in interview with CNBC that Bitcoin had status as non-security at SEC but it does not mean it should not be regulated. “Where digital assets land at the end of the day will be driven in part by regulation both domestic and international, and I expect that regulation will come in this area both directly and indirectly,” Clayton said.
  • Chairman of Monetary Authority of Singapore issued notice to cryptocurrency investors, warning them of dangers of engaging with such a volatile market. Warning comes after Prime Minister of Singapore Lee Hsien Loong had his likeness appropriated by user on BitClout social token platform, who used PM’s name to sell tokens worth $10,000.
  • Sveriges Riksbank, Sweden’s central bank, found critical issues that must be addressed before e-krona can be used in first results of central bank digital currency pilot on network based on R3’s Corda blockchain. Riksbank said new CBDC technology needs further investigation, with scalability presenting a major bottleneck and also noted some privacy challenges.

Project Development

  • Signal, the private messaging app, is launching payments feature using MobileCoin, which is based on Stellar blockchain technology and is able to work on mobile devices while also protecting users’ privacy. Payment feature will only be available to users in U.K., and only on iOS and Android. Desktop support is not included.
  • Trading card company Topps announced special purpose acquisition company merger with Mudrick Capital. Company, in which Mudrick led $250 million investment at $1.3 billion valuation, said to be considering blockchain and NFTs as “growth accelerator.” Card company anticipates pushing more content through blockchain pipeline, expanding NFT distribution across marketplace partners and integrating NFTs into more collector experiences through 2021.

Institutional

  • NYDIG raised $100 million from Liberty Mutual and Starr Insurance in a “growth capital round” alongside other unnamed property and casualty coverage firms. Company is reportedly gearing up to make bitcoin insurance plays with financial backing from some of industry’s biggest names, including MassMutual, New York Life and others. Product details are not yet available, but NYDIG Executive Chairman Ross Stevens hinted “new bitcoin-denominated products for global insureds” were in works.
  • Grayscale Investments said it’s “100% committed” to converting Grayscale Bitcoin Trust into exchange-traded fund in blogpost that reiterated Grayscale’s product lifecycle has always included goal to convert products into ETF when permissible. Timing driven by regulatory environment was key factor, and management fee being reduced accordingly was also mentioned.
  • CI Global Asset Management launched CI Bitcoin Fund, which it described as North America’s first mutual fund to provide dedicated exposure to Bitcoin. Canadian investors can access Bitcoin market with management fee of 0.40% and initial minimum investment of $500.
  • State Street plans to commence trading cryptocurrency in middle of this year, after taking part in construction of Currenex trading technology arm with Pure Digital to create institution-focused digital currency trading platform. Plan is to transpose FX infrastructure to crypto space via bank-led consortium and platform by building OTC offering with bilateral credit lines and full transparency, so that banks can see and turn on/off counterparties as they choose. 
  • Meitu said it purchased 175.6 Bitcoin for $10 million, bringing total holdings to over 940 Bitcoins. Company has invested $100 million in Bitcoin and Ether positions since adopting cryptocurrency investment plan in early March, with over 31,000 ETH in additional holdings.
  • California real estate company Caruso Properties will now accept bitcoin for rent on all its properties in partnership with Gemini Exchange, making Caruso largest real estate manager in U.S. to accept digital asset as form of payment. Additionally, Caruso has allocated roughly 1% of treasury into bitcoin.

Exchanges

  • Coinbase revealed voluntary earnings report, showing it raked in $1.8 billion over the quarter with a net income of approximately $730 million to $800 million. Other important notes are active users jumped from 2.8 million in fourth quarter of 2020 to 6.1 million in first quarter of 2021. Additionally, trading volumes topped $335 billion in Q1. For all of 2020, trading volume was $193 billion.

Mining

  • Riot Blockchain announced it has inked agreement to purchase 42,000 mining machines from Bitmain Technologies, pushing total of fully deployed Antminers machines to 81,150. Riot Blockchain said it plans to buy S19j Antminers machines for $138.5 million, and once active, additional miners would increase firm’s mining hashrate by 93%. Riot is expecting first batch to be delivered in November this year with additional deliveries expected through October 2022.
  • Riot Blockchain announced it is acquiring Whinstone US, Inc. data center operations in Texas from Northern Data AG, signing agreement to acquire firm’s Texas operations for $80 million cash and 11.8 million shares of Riot stock at total value of $651 million. Northern Data will own 12% of total outstanding common stock of Riot Blockchain.

Defi

  • DeFi management and protocol aggregator platform Instadapp announced launch of governance token, INST. Token is set to go fully live later in year to coincide with transfer of control over protocol to DAO governance process in Q2.

Fundraising

  • Cross-chain asset bridge and application hub ChainSwap closed $3 million strategic funding round with participation from Alameda Research, OKEx’s venture arm OK Block Dream Fund, NGC Ventures, Spark Digital Capital, Metaconstant Ventures, CMS Holdings, Rarestone Captial, SRC Capital, DAO Ventures, and others. ChainSwap platform allows projects to bridge between Ethereum, Binance Smart Chain, and Huobi Eco Chain, with plans to add cross-chain solutions for Bitcoin, Polkadot, and Solana in future.

Things to Watch This Week

  • Coinbase Listing
    • Coinbase is set to list publicly on the Nasdaq this week, marking the first cryptocurrency exchange to do so. Given its size and stature in the industry, many see a volatile week ahead due to the listing. The company is currently valued at $90-100 billion according to the last week of private trading on the Nasdaq and various other estimates. However, some figures have recently begun reaching levels of $120-130 billion and more, and many analysts are expecting the listing event to potentially lift the rest of the cryptocurrency markets significantly. All eyes will be on the performance of the company’s stock on April 14 as it breaks new barriers for the cryptocurrency industry, establishes a precedent for future events, and signals the maturation of digital assets in the public eye. 
  • VanEck Bitcoin ETF Decision Deadline
    • We might also hear from the SEC this week on whether the approval of the VanEck Bitcoin ETF to be listed on the CBOE has been approved or not. The CBOE filed a Form 19b-4 early March, formally announcing its intention to list and trade shares of the VanEck Bitcoin Trust and kicking off the legal review period of 45 days. Within those 45 days, the SEC has to either approve or disapprove the application, or extend the review period. The SEC can extend the review period up to 240 days before it has to make a final decision. While a Bitcoin ETF does not currently trade within the U.S., Canadian regulators have approved multiple Bitcoin ETFs and many experts believe it is likely the SEC will approve one in the U.S. this year as well. It will be important to monitor any potential announcements and the effect it could have on markets throughout the week. 
    • Maple Leaf Capital@MapleLeafCap
      Presented without comments ahead of the $COIN listing when compared to a small subset of exchange tokens / DEX’s out there. Am I making any glaring errors? (TVL / Volume / Fee / token data are all eyeballed).

      Best enjoyed in combination with @JohnStCapital ‘s storm on $COIN:
      twitter.com/JohnStCapital/…

      Steven@Dogetoshi
      Cumulative DeFi revenue approaching $1,000,000,000. Adding nearly $200 million in March alone.
      Yann & Jan@Negentropic_
      Strong #Bitcoin support building around this $58K area.
      Caitlin Long @CaitlinLong_
      FURTHER THOUGHTS on big banks entering #bitcoin, per @CoinDesk story abt @StateStreet today. INSANELY risky. Some asked v good questions why bitcoin is so diff than gold or stocks. In this post I answer, using WallSt terms (eg VAR models don’t work).
      Enjoy coindesk.com/state-street-a…

      Rachel @tolstoybb
      Can any of you explain to me why the spread is so large in bitcoin futures vs spot? Blah blah blah counterparty risk or whatevs but even the CME futures look like an arbitrage opportunity. Is the margin call risk /really/ that high?

      SBF@SBF_Alameda
      People in crypto want to be long $4T. They have $1T. The outside world is willing to lend $0.5T, but beyond that various risk comities are like “uh idk let’s get back to this one next year”. So mkt cap is $2T, and people bid up interest rates on the other $0.5T of exposure.

      Lars@lars_hl
      Web traffic on cryptocurrency exchanges saw a decrease of 8.5% in March. Together, spot and derivative exchanges recorded a total of 395.2 million website visits in March.

      Binance continues to dominate by market share, with Asian exchanges Indodax, Upbit and BIthumb running up the ranks.

      nic carter@nic__carter
      So there’s two nations. One of them has a free floating currency and permits the free flow of capital. The other has a managed currency and maintains strict capital controls. Which nation is Bitcoin more hostile to?

      I already wrote my response to Thiel. The US is the only country that can disrupt itself and be the architect of a neutral monetary system. Yes, it’ll hurt to lose the sanctions ability, but we’re losing that anyway.
      coindesk.com/crypto-dollar-…

      Mason Nystrom @masonnystrom
      Super excited about the launch of the Metaverse Index (MVI) by Index Cooperative! $MVI will be managed by @verto0912 and @DarkForestCap.
      twitter.com/indexcoop/stat…

      The initial $MVI portfolio is comprised of the top assets across Virtual Worlds, NFTs, Social Tokens, Gaming, and all things metaversal!

      Jason Choi@mrjasonchoi
      % of top 50 coins that outperformed $BTC over 90 days. The elusive “Alt Season” is currently in session.

      Larry Cermak @lawmaster
      Coinbase just dropped the Q1 earnings and outlook. As expected higher revenue than in the entire 2020. Q1 summary: • ~$1.8 billion revenue • Adjusted EBITDA of ~$1.1B • Net income of $730-800M • 56M verified users (+13M) • 6.1M monthly transacting users (+3.3M)

      Growth over last quarter • Revenue —> 207.6% • Net income —> 312.9% • Traded volume —> 272.0%

      Assets on Platform are ~$223B and $122B of that is coming directly from institutions. Coinbase expects meaningful growth this year driven by increased institutional interest but admits that its insti revenue is inherently unpredictable

      This is not unexpected but just to illustrate how crazy the growth has been, this chart says it all

      twan@dantwany
      1/ Q1′ 21 was a historical quarter in venture funding for the crypto/blockchain sector, with roughly $3.18 billion allocated to crypto/blockchain projects. 2021 is on track to surpass 2018 as the largest year in private funding for the industry. A thread: theblockcrypto.com/genesis/100474…

      2/ For perspective on how insane private investment in the sector was this quarter, in all of 2020 in aggregate, there was less total funding with $3.07 billion in private financing than just this recent quarter.

      3/ Compared to 2018, the sector’s most significant funding year in its history with $5.77 billion in private funding, the first quarter has already accounted for more than half of that total or approximately 55% of the total private investment in 2018.
      READ MORE

      Jim Bianco@biancoresearch
      A sort of milestone was reached today. The total value of all cryptos surpassed the value of the US banking system. Why is this measure relevant? It is an admittedly imperfect attempt to measure the size of the current CeFi system versus the coming DeFi system. (1/4)

      So sticking with this idea, what’s next? Another double and cryptos becomes larger than US Financial Companies (Banks + brokers, insurance, exch, fin cos, asset managers, etc.) 4x rise and Cryptos surpass the value of all global financial companies.
      READ MORE