Bitcoin A Smart Hedge For Investors, says Chairman of $100 Billion Starwood Capital Group

Bitcoin A Smart Hedge For Investors, says Chairman of $100 Billion Starwood Capital Group

While “there’s a lot of fascination” for BTC to be worth $100k or $25k to PayPal CEO, it’s programmable money, NFTs, and DeFi that’s “really interesting.”

American billionaire Barry Sternlicht, the chairman of Starwood Capital Group, said he has about 2-3% of his net worth in cryptocurrency.

Starwood has about $100 billion under management in debt, real estate, and energy assets.

Speaking at a Bloomberg event on Friday in Miami, Sternlicht called Bitcoin a smart hedge for investors in a world that just “prints money.”

“If it goes to zero, it won’t hurt me.”

Talking about inflation, Sternlicht said that he expects the US stimulus package to have inflationary pressure on commodities, exacerbating a housing shortage and driving up rents.

Back in October, Sternlicht had revealed that his crypto portfolio consists of Bitcoin and Ether due to both having their own advantages.

At the time, he had said that money printing was the reason for investing in crypto assets.

“The reason I own BTC is because the US government and every government in the Western hemisphere is printing money now until the end of time,” he said. While he pushed back on Bitcoin being “worthless,” according to him, Bitcoin is a “dumb coin,” with “no real purpose other than a store of value.”

Meanwhile, bitcoin and crypto’s price action is of least concern for PayPal.

Speaking at the Reuters Next conference, the payment giant CEO Dan Schulman noted that while “there’s a lot of fascination” for BTC to be worth $100k or $25k “what’s really interesting to me is can crypto or digital forms of currency add incremental utility to payments – things like programmable money, things like NFTs (non-fungible tokens), things like some DeFi applications.”

At the same event, Christine Lagarde, European Central Bank (ECB) president, talked about inflation, saying it “looks like a hump. And a hump eventually declines.”

She is confident that inflation will decline next year, adding, “we need to very clearly indicate that we stand ready (to act), in both directions.”

Perry Warjiyo, Governor of Indonesia’s central bank, also commented on the country’s inflation, which is projected to rise towards 4% in Q2 or early Q3 of 2023.

“But by nature, interest rate decisions need to be forward-looking, need to be preemptive, need to be front-loading.”

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Author: AnTy

Crypto Lender Celsius Network CEO Confirms Losing Funds in $120.3 Million BadgerDAO Hack

Crypto Lender Celsius Network CEO Confirms Losing Funds in $120.3 Million BadgerDAO Hack

But said, “No Celsius client and user assets were affected” in the attack on the Badger platform.

Celsius Network, a popular crypto lender with $26.4 billion in assets as of Oct. 15, confirmed that the company was affected by the latest decentralized finance (DeFi) hack of BadgerDAO.

As we reported earlier this week, the lending platform BadgerFAO that offers yields with a focus on wrapped Bitcoin (WBTC), lost $120.3 million in a front-end attack.

During an ask-me-anything (AMA) YouTube live stream on Friday, Celsius Chief Executive Officer Alex Mashinsky said the company “lost money” in the BadgerDAO but didn’t divulge just how much. Some have speculated that Celsius may have lost nearly 897 WBTC worth about $51 million at the time.

“It wasn’t a Celsius hack,” Mashinsky said. “It was a Badger hack, but some of the Celsius funds were there, so Celsius lost money. … But none of the Celsius members lost money.”

The CEO further said that they are working with the Badger team to recover the lost funds and are collaborating on the investigation.

The company also took to Twitter to explain that it was the Badger platform that had suffered an attack of unauthorized withdrawal of funds and that Celsius client and user assets were not affected.

Celsius Network also said that it is assisting the Badger team on the resolution and has already initiated a full scan of all Celsius DeFi wallets.

Its security team also identified a compromised withdrawal and “immediately shut down the attacker’s access to funds on the Badger platform.”

They have also traced the attacker and reported the information back to Badger.

“CelsiusNetwork also wanted to take this opportunity to remind our community to exercise extreme caution when interacting with DeFi platforms and when approving connections to the sites, apps, and smart contracts,” it said.

The company recently closed a $750 million Series B funding round while being targeted by several regulators in the US over alleged securities laws violations.

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Author: AnTy

Bitcoin Miners HODLing: Marathon Mines 53% Less BTC in Nov., Hut 8 Producing Each BTC at A Cost of $3k

Bitcoin Miners HODLing: Marathon Mines 53% Less BTC in Nov., Hut 8 Producing Each BTC at A Cost of $3k

Bitcoin miner Marathon Digital Holdings reported mining 196 BTC in November, down from 417.7 BTC in the previous month.

This drop in bitcoin production was due to maintenance and upgrades to the power generating facility in Hardin, MT, that negatively impacted the mining.

In 2021 up until December 1, Marathon produced 2,712.3 BTC.

The company has kept all the Bitcoin generated during this month, as the last time it sold Bitcoin was on October 21, 2020.

Its total bitcoin holdings have now increased to about 7,649 BTC, covering the 4,812.66 BTC the company purchased in January.

Meanwhile, it holds $623.7 million in cash on hand, with the total liquidity, cash, and bitcoin holdings now at $1.1 billion.

“After closing an oversubscribed convertible note offering, we increased our total liquidity to $1.1 billion, which provides us with optionality to improve our efficiency and further scale our operations,” said Fred Thiel, Marathon CEO.

In November, Marathon received 15,520 top-tier ASIC miners from Bitmain and 56,826 miners year to date, with an additional 8,477 miners currently in transit.

Following the successful system upgrades to the power plant in Hardin, MT, as they began operating near full capacity, it generated 34 Bitcoin on Dec. 1.

Marathon now has an existing mining fleet of 31,000 active miners producing 3.2 EH/s. Thiel said they are “well-positioned to reach 13.3 EH/s by mid-2022 and to remain agile and opportunistic as our industry evolves in the coming quarters.”

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Another Bitcoin miner, Hut 8, also posted its production update for last month. The miner produced 265 BTC in November, bringing the company’s Bitcoin balance to 5,242.

Much like Marathon, Hut 8 deposited 100% of the self-mined BTC into custody as part of its HODL strategy.

The company completed the deployment of high-performance NVIDIA chips last month. NVIDIA CMPs were deployed to mine the Ethereum network via Luxor pool and are receiving payouts in Bitcoin. Hut 8 currently has an installed hash rate of 1.7 EH/s.

“Our NVIDIA CMP deployment is contributing revenue of approximately $140,000 per day, based upon current mining economics,” said Jason Zaluski, Head of Technology for Hut 8.

“Given the low power intensity of these chips, our cost per Bitcoin of approximately $3,000 means we are achieving unit margins in excess of 95%.”

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Author: AnTy

Crypto Market Tanks: BTC Correlation with S&P 500 Reaches 2021 High, USD Longs at Highest Level Since June 2019

On another wild day in the cryptocurrency markets, prices tanked to levels not seen since mid-October or September.

During this brutal sell-off, Bitcoin’s price fell to about $42,000 in the spot market, representing over a 39% pullback from the $69,000 all-time high set early last month. As of writing, Bitcoin is trading just above $47,300.

While Bitcoin only dropped to $42k in the spot market, it fell even lower on derivatives platforms. On Deribit, BTC crashed to just under $40k and on Huobi to about $28,800.

As we reported, historically, a red month has resulted in a red December, and now it’s to be seen if sentiments will recover by the end of the month or we’ll consolidate here.

Ether meanwhile went to $3,580 while perpetual contracts dropped to about $3,400. While this represents a 26.6% drop from $4,880 ATH, much lower than Bitcoin’s, from December 1st, BTC crashed just over 26% while ETH 22.5%.

ETH has now recovered to $3,900. This latest sell-off came amidst the calls for a flippening that would put Ether as the number one crypto asset. ETHBTC, meanwhile, is still above 0.080.

The total crypto market cap has now tanked to $2.33 trillion, down from $3 trillion early last month and currently at the early October level.

The likes of ICP, FIL, EOS, THETA, FTM, ONE, CRV, ZEC, LTC, and NEO got dumped the most in the last 24 hours by as much as 27%, as per CoinGecko.

In Tandem With Stocks

However, the crypto market didn’t tank alone; rather, it was in tandem with the global stock market. As such, the 100-day correlation coefficient of Bitcoin and the S&P 500 climbed to its highest reading of the year at 0.33.

On Friday, stocks initially rose only to slip as US employment growth slowed down considerably in November as 594,000 people entered the labor force, the most in 13 months. But the unemployment rate plummeted to a 21-month low of 4.2%.

This week, Federal Reserve Chairman Jerome Powell also told lawmakers that the US central bank should consider speeding up the tapering of bond purchases at its Dec. 14-15 policy meeting.

This was the worst December opening performance for US stocks in two decades.

The US dollar, meanwhile, is strong above 96 and in line with this USD net long positioning soared to $23.99 billion, its highest level since mid-June 2019. For Bitcoin, net short positions climbed to 1,691 contracts after falling to the smallest since mid-January at just 160 contracts last week.

Crypto Carnage

After early September, the crypto market had its biggest liquidation event as 417,654 traders liquidated for $2.58 billion in the last 24 hours, with Binance accounting for 28% and OKEx 26% of them. These numbers, however, are underreported because Binance and Bybit limit their liquidation data.

As a result, open interest has taken a big hit. OI on Bitcoin futures has fallen to $17 billion, early October level, down 41% from early November ATH. With this, CME has captured first place with $3.72 bln OI followed Binance at $3.56 bln, as per Skew.

As for Ether, the total OI has gone down to $9.81 bln, from $12.98 bln on Dec.1 and $14.66 bln on Nov. 10. Here, both FTX and Binance are leading at $2 billion.

Now that so much leverage has been wiped out from the market, the funding rate has normalized and gone negative on most crypto exchanges. The highest Bitcoin funding rate is currently on Huobi at 0.01%.

During this crypto carnage, ETH fees surged to nearly 1000 gwei, making it extremely costly for small users to use the Ethereum network. Additionally, the majority of the exchanges stopped working, meaning users couldn’t take advantage of the volatility.

But at the same time, El Salvador bought this dip, as announced by President Nayib Bukele but missed the bottom by a few minutes. Following in the footsteps of Bukele, Tron (TRX) founder Justin Sun also bought 150 BTC on this dip.

Amidst the onslaught of bears, the bullish factor is the market-value to realized-value metric (MVRV), which represents the ratio of free-float Bitcoin market cap to the realized value.

As of writing, MVRV has fallen to 1.941, which was at 2.98 in October and 4.02 in February.

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In its latest report this week, Messari’s Ryan Selkis noted that “If history were to repeat itself, what’s that mean in dollar terms? Hitting a MVRV of 3 again this year would take us to the $100,000-125,000 range. Not bad!”

“The king has no real rival,” he added.

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Author: AnTy

Coinbase Cloud wanting to be the “AWS of Crypto,” Amasses $30 Billion in Staked Assets

Coinbase Cloud wanting to be the “AWS of Crypto,” Amasses $30 Billion in Staked Assets

With “a growing number of the world’s largest companies” integrating crypto and needing an infrastructure to operate, Coinbase is clear about its path to dominance.

Cryptocurrency exchange Coinbase has more than $30 billion worth of crypto assets staked on its platform on the 60,000 hosted nodes across over 30 blockchains, including Ethereum 2.0, which is yet to be fully launched as well as Tezos (XTZ) and Cosmos Hub (ATOM), as of November 2021.

“By empowering current and future builders of the crypto-economy,” Coinbase Cloud will “help accelerate the Web3 evolution. This is where the world of software is going, and we’re excited to lead the herd,” said Aaron Henshaw, the division’s head of engineering, in a blog post this week.

Henshaw is the co-founder of non-custodial platform Bison Trial, the hosted infrastructure company acquired by Coinbase in January this year for over $80 million, which is the core of Coinbase Cloud.

While Coinbase Cloud hosts this growing amount of staked crypto, the firm does not custody these assets. Compared to Coinbase’s custodial staking service charging a 25% commission, Coinbase Could take an 8% cut of staking rewards.

Coinbase has been looking to make Coinbase Cloud the Amazon Web Services of cryptocurrency by providing the blockchain infrastructure. AWS is the $1.8 trillion subsidiary of the e-commerce giant.

“We want to be the AWS of crypto,” said Coinbase chief product officer Surojit Chatterjee in an interview.

“We are building this whole Coinbase Cloud suite of products that you can think of as crypto computing services, to help developers build their applications faster.”

The success of Coinbase Cloud means “crypto is gaining mainstream appeal,” said the company noting the overall crypto market cap has reached $3 trillion this year while over $250 billion are locked in decentralized finance (DeFi).

“A growing number of the world’s largest companies are looking to integrate crypto into their applications.”

“Recently, we’ve seen Stripe, Square, Reddit, the NBA, and others introducing crypto into their product lines with no signs of this trend slowing down. They all have one thing in common: a need for infrastructure and tools to operate and participate in the ecosystem.”

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Author: AnTy

97-Year Old Billionaire Charlie Munger says He’d “Never” Buy Cryptocurrency

97-Year Old Billionaire Charlie Munger says He’d “Never” Buy Cryptocurrency

“I want to make my money by selling people things that are good for them, not things that are bad for them,” said the right-hand man of Warren Buffett.

Berkshire Hathaway’s Charlie Munger reiterated his criticism of cryptocurrencies as he said he would not participate in the “insane” crypto boom.

“I’m never going to buy a cryptocurrency. I wish they’d never been invented,” said the 97-year old investor and the right-hand man of Warren Buffett.

According to him, China made the “correct decision” in banning them, and by letting the cryptocurrency market continue, the US “English-speaking civilization” has simply made the wrong decision.

“I just can’t stand participating in these insane booms, one way or the other. It seems to be working; everybody wants to pile in, and I have a different attitude. I want to make my money by selling people things that are good for them, not things that are bad for them,” Munger said, who, along with Buffett, has been criticized by crypto market participants for memeing Coca Cola to “greedily profit from feeding poison to children.”

“Believe me, the people who are creating cryptocurrencies are not thinking about the customer, they are thinking about themselves.”

Addressing Australian investors at the Sohn Hearts and Minds conference on Friday, Munger further talked about the investment environment being “a little more extreme” than what it has been during his time.

In a wide-ranging discussion with Dr. Mark Nelson of hedge fund Caledonia, he shared his views of the current market, which is said to be wildly overvalued.

According to him, while the dot-com era was crazier in terms of valuations, overall, the current environment is “even crazier” than the dot-com boom of the late 1990s that led to a bust.

Besides backing China’s crackdown on crypto, he also backed the country’s attempt to clamp down “some of the exuberances” of capitalism.

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Author: AnTy

Kryptoin’s Spot Bitcoin ETF Is Next in Line for Rejection Before Christmas, After SEC Declines WisdomTree’s ETF

Kryptoin’s Spot Bitcoin ETF Is Next in Line for Rejection Before Christmas, After SEC Declines WisdomTree’s ETF

The US Securities and Exchange Commission (SEC) denied WisdomTree’s application for a spot Bitcoin exchange-traded fund (ETF) this week.

“The Commission concludes that BZX has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirement that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices’ and ‘to protect investors and the public interest,” said the agency in a letter on Wednesday.

The rejection comes seven months after the SEC first started evaluating WisdomTree’s Bitcoin Trust application, filed with the Cboe BZX exchange in March. The watchdog delayed the decision on it twice, first in June and then in July.

If approved, the Trust would have allowed retail and institutional investors to invest in a regulated financial product covering Bitcoin without investing in crypto directly.

The rejection, however, wasn’t unexpected as SEC Chair Gary Gensler has repeatedly shown a preference for a Bitcoin futures ETF, which began trading in the US in October over those physically-backed.

Last month, the SEC also rejected investment firm VanEck’s proposal for a spot Bitcoin ETF. The next in line is Kryptoin’s application which is also “likely to be denied” just before Christmas.

Earlier this week, the largest digital asset manager, Grayscale, which has filed to convert its bitcoin trust (GBTC) to an ETF, sent a letter to the agency arguing that SEC’s repeated rejections are “arbitrary and capricious” since it has approved futures-based ETFs.

Additionally, this could violate the Administrative Procedure Act (APA), which covers the decision-making process of federal agencies, it said.

“The number of plaintiffs with standing to sue the SEC for an APA violation just increased by one,” commented Jake Chervinsky, Head of Policy at Blockchain Association.

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Author: AnTy

After In-App Currency, Dating App Tinder is Ready to Join the Metaverse with “Tinderverse”

After In-App Currency, Dating App Tinder is Ready to Join the Metaverse with “Tinderverse”

Popular dating app Tinder is testing an in-app currency for the users to pay for premium services as well as receive it as rewards for good behavior on the app, said Renate Nyborg, Chief Executive Officer of Match Group that owns Tinder, in an interview at the Reuters Next Conference.

Tinder will give these rewards for a number of things, such as adding more bio profile information and helping people find more connections, she explained.

She further talked about the company’s plans for dating in the metaverse, saying, “From a Tinder perspective, we’ve been talking about a Tinderverse internally, which is more about blurring the boundaries between offline and online.”

Nyborg cited the company’s newly launched Explore feature and interactive events like “Swipe Nights,” which she called one of the best examples of the metaverse.

This adventure-style game allows users to choose their own adventures and match with others based on their choices.

Another popular dating app Bumble also said during its November earnings call that it is preparing for “whatever emerges in the metaverse.”

Nyborg said Tinder was still focused on helping people meet in real life as the COVID-19 pandemic showed that while people could only connect through the internet, it demonstrated the importance of real-life connections.

“The mission is to keep the magic of human connection alive,” she said.

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Author: AnTy

Adidas Buys a Bored Ape, Animoca Brands Partner with BSC, Blockchain.com to Make NFT More Accessible

NFT Mania: Adidas Buys a Bored Ape, Animoca Brands Partner with BSC, Blockchain.com to Make NFT as Accessible as Crypto

Apparel brand Adidas has bought a Bored Ape Yacht Club (BAYC) NFT to mark its entry into the metaverse. The company has also joined hands with Bored Ape creators Yuga Labs and others.

“Today we leap Into The Metaverse with @BoredApeYC, @gmoneyNFT & @punkscomic. It’s time to enter a world of limitless possibilities,” tweeted the brand.

Adidas purchased Bored Ape Yacht Club NFT #8774 for 46 ETH, according to the blockchain data, which showed this purchase was made in September that puts the cost at more than $156k at the time.

Besides an NFT avatar, last month, Adidas collaborated with the Ethereum-based metaverse project The Sandbox.

Rapper Pitbull is also joining the NFT space as he signed a multi-year deal with music-focused NFT platform OneOf for an undisclosed sum of money. The deal will first see Pitbull evangelize for OneOf and then later launch his own NFTs.

The Tezos-based NFT platform is backed by veteran music producer Quincy Jones which aims to serve the NFT needs of the music industry. Earlier this year, The Grammys also partnered with OneOf for a 3-year series of NFTs.

“If used to their full potential, NFTs will empower the music industry in a way few other technologies ever have,” said the OneOf team at the time.

The English Premier League is also considering a partnership with a cryptocurrency platform that provides NFTs, according to The Times. The plan is to take a “slow and cautious” approach which will be different from the fan engagement model provided by platforms like Socios, on which several Premier league teams have launched their tokens.

Accelerating the Adoption

In the crypto industry, Animoca Brands, the company behind Axie Infinity (AXS), has partnered with Binance Smart Chain (BSC) to launch a $200 million investment program to incubate and accelerate crypto gaming startups as well as increase mainstream adoption of blockchain tech.

The new investment program will support GameFi and blockchain games, which require funding for a runway to build their products.

“Gaming is one of the strong pillars of Web 2.0, reaching billions of users,” said Gwendolyn Regina, investment director at BSC’s Accelerator Fund, in a statement. “Its large-scale real-life use case makes it one of the core focus areas for crypto’s mass adoption to onboard retail consumers into the Web 3 world.”

This week, digital assets platform Blockchain.com also announced that it would be launching its own NFT platform, which will be powered by the NFT marketplace OpenSea.

The platform is currently in a beta stage but is open for individuals to sign up on its waiting list.

The company aims to tackle the “same challenges” of adoption that crypto faced during its earlier days. Blockchain wants to make accessing the NFT market, which is currently too complex to be “as easy as accessing the crypto market,” it wrote in a blog post.

Crypto exchanges Coinbase and FTX.US have launched their own NFT marketplaces in October, while Binance did it before that in June.

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Author: AnTy

Big US Banks Exploring Using Bitcoin as Collateral Against Cash Loans, Fidelity Rolls-out the Service for Institutions

Big US Banks Exploring Using Bitcoin as Collateral Against Cash Loans, Fidelity Rolls-out the Service for Institutions

Fidelity Digital Assets is set to allow its institutional customers to use Bitcoin as collateral against cash loans.

This new service is for those BTC investors who want to turn their holdings into cash but don’t want to sell their crypto assets either, said Tom Jessop, president of Fidelity Digital Assets, in a statement this week.

With this service, Fidelity is targeting hedge funds, miners, and over-the-counter (OTC) trading desks.

Fidelity Investment’s subsidiary will hold the crypto and won’t make the loans itself. For this, it has partnered with crypto lender BlockFi, which will help manage the risk by providing cash for 60% of the loan backed by the trillion-dollar asset. This means, to avail of this service, Fidelity customers have to have an account with BlockFi as well.

“As the markets grow, we’d expect that this becomes a fairly important part of the ecosystem.”

Fidelity is one of the largest asset managers in the US, with over $4 trillion in assets under management (AUM). This week, it launched a Bitcoin spot ETF in Canada.

Exploring Bitcoin-Backed Loans

Besides Fidelity, banks in the US, including Goldman Sachs, are also exploring using BTC as collateral for cash loans to institutions, reported Coindesk citing people familiar with the plans.

Earlier this year, Goldman Sachs re-established its crypto trading desk amid increased interest from its clients, including endowments, hedge funds, and other institutional money managers. The trading desk provides principal liquidity for CME Group’s crypto-related futures and OTC equivalents.

The process allows Goldman Sachs to execute trades with larger notional values. “We’re active in providing liquidity and taking risk on behalf of our clients and in the market,” said Andrei Kazantsev, Goldman’s global head of crypto trading, in an interview.

The Herd is Coming

While these banks won’t get involved in the spot crypto market, they will offer this service through futures products.

“Goldman was working on getting approved for lending against collateral and tri-party repo,” one of the people was quoted as saying. “And if they had a liquidation agent, then they were just doing secured lending without ever having bitcoin touch their balance sheet.”

Already, crypto-friendly banks like Silvergate and Signature have been offering Bitcoin-backed cash loans since earlier this year; late last year, the then-acting OCC Chief Brian Brooks gave banks the green light to accept Bitcoin as collateral.

Out of the half a dozen big banks, some are ready to offer this service in the “next three to six months,” while some “further out.”

“What’s interesting is some of these banks will use their own balance sheet to make the loan. Others will syndicate this out,” another individual from a large institutional trading firm was quoted as saying.

Fidelity Digital Assets and Coinbase are cited as potential custodians among these banks. But not just are big banks interested in offering this service but also smaller lenders are considering ways to accept crypto as collateral.

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Author: AnTy