Mulls IPO As Crypto Transactions Surpasses $1T Mark Mulls IPO As Crypto Transactions Surpasses $1T Mark

Following the public debut of American crypto exchange Coinbase, several other blockchain and crypto-native companies have also hinted at the possibility of going public via an Initial Public Offering (IPO).

The latest to toe that line is – the popular crypto exchange and wallet service provider.

Almost 33% Of Bitcoin Network’s Transactions

Earlier this week, Macrina Kgil, Chief Financial Officer (CFO) at, spoke with Fortune Magazine. She explained that the company has indeed been looking into the possibility of a public stock debut.

Speaking to the news source and a blog post released on the same day, Kgil explained that had crossed the trillion-dollar mark for crypto transactions processed on its platform.

The blog post explained that had processed almost 33 percent of all Bitcoin network transactions since 2012. Most of those transactions had come from wallets in the past two years.

The milestone appears to have fueled the company, with Kgil telling Fortune that an IPO in the next 18 months isn’t out of the question. is one of the most valuable companies. The firm has had two funding rounds in 2021 alone, with the latest being a $300 million round in March. Lead participants in the funding round were DST Global, Lightspeed Venture Partners, and VY Capital, and it gave a valuation of $5.2 billion.

Company CEO Peter Smith said that they would use the funds raised to grow their institutional business. The move appears to have paid off, as Kgil pointed to growth in that aspect as one of the catalysts for the $1 trillion milestones.

Crypto to Wall Street

Now that an IPO seems to be on the cards, is joining a fresh breed of crypto companies looking to debut on major exchanges soon. Last month, stablecoin developer and fintech giant Circle announced that it had formed a partnership with Concord Acquisition Corp – a blank-check special-purpose acquisition company (SPAC) in a $4.5 billion deal.

Under the agreement terms, Concord and Circle will be acquired by a holding company based in Ireland. This will pave the way for the combined entity to list on the New York Stock Exchange (NYSE), with an expected ticker of “CRCL.” Circle also claimed that existing company shareholders would own about 86 percent of the public entity when the deal is completed.

Kraken, another top US exchange, has also hinted at a possible public debut. In June, company Chief Jesse Powell told BloombergTV that an IPO seems like a “natural progression” for the company as it looks to “bring crypto to the world.”

Powell explained that Kraken is now doing the groundwork for a public debut in the next year or 18 months. The company is yet to give details of how the IPO will go, although a spokesperson for the company told industry news sources in March that they would not be listing through a SPAC as they are “too big.” Also, considering Coinbase’s initial lackluster performance, a SPAC deal isn’t so attractive to Kraken anymore.

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Author: Jimmy Aki

Coinbase to Improve Customer Service After “Account Security” Debacle

Coinbase to Improve Customer Service After “Account Security” Debacle

San Francisco-based cryptocurrency exchange Coinbase erroneously told about 125,000 of its customers that their security settings had changed.

The company, which started publicly trading on the Nasdaq in April through a direct listing, said that it resulted from an internal error.

Coinbase has spent “most of the weekend working with customers to make sure we can address their questions,” company spokesperson Andrew Schmitt told CNBC. “We believe the only way to build trust with our customers is to be transparent when we mess up.”

The exchange isn’t really known for its stellar customer services and time and again ends up going down during high bouts of volatility, and its customers also complain of poor service.

Coinbase has more than 68 million users and holds $223 million in assets, according to the company’s second-quarter financial results.

Last week came the reports that Coinbase customers’ accounts were hacked and that they couldn’t contact anyone from the company.

The security-settings email was sent to customers at 1:45 p.m. PT Friday by the company that read, “Your 2-step verification settings have been changed,” which prompted confusion and alarm among investors.

Coinbase then sent the second email that notification was “sent in error,” further explaining in a tweet that there was a “notification delivery issue.” “Our team immediately began work to identify the issue and stop these erroneous notifications,” it added.

According to the company spokesperson, the issue resulted from an internal error instead of a hack. He said,

“All of a sudden, the system just started sending stuff like a bug in the system, but it was not a malicious or third party error.”

The leading cryptocurrency exchange in the US said that it is improving its customer service by rolling out voice support this month and live chat later this year.

Meanwhile, shares of Coinbase (COIN) are trading at $262.66, finally trending up this month but way off of its debut day ATH $429.54.

Recently, the exchange said it had stockpiled $4 billion in cash to prepare for a “crypto winter.”

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Author: AnTy

Cardano (ADA) Remains A Favorite Among Retail & Institutions Alike with Alonzo Upgrade “On Schedule”

Cardano (ADA) Remains A Favorite Among Retail & Institutions Alike with Alonzo Upgrade “On Schedule”

The upgrade is a major milestone for Cardano, which is in its “final, critical stage” that will “usher in a transformative era of smart contracts capability.” Ahead of the big day, ADA is trading near its ATH, targeting $3, as Cardano investment product saw the largest on record inflow.

Finally, after years of development, Cardano is all set to have smart contracts.

Talking about the much anticipated Alonzo upgrade in a recent vlog post, Cardano founder, who also co-founded Ethereum, Charles Hoskinson, said, “Everything’s green and go, we’re on schedule.”

The Alonzo hard fork is a major upgrade for the third-largest network with its full capabilities, including the implementation of smart contract functionality. This functionality will allow anyone to deploy their own smart contracts on the blockchain, paving the way for Cardano-native decentralized applications.

Alonzo’s activation will also mean the end of the Shelley era of Cardano and marking the beginning of the Goguen phase.

In its monthly update, IOHK shared that Cardano testnet is primed for release “for the first of September,” though “this is not without risk” as there could be “a severe unexpected issue which might push it out but with all known things that we know right now we remain on track,” it added.

This major milestone for Cardano is basically in its “final, critical stage” that will “usher in a transformative era of smart contracts capability.”

During the surprise Ask Me Anything (AMA) on Monday, Hoskinson also explained that 25 stakeholders went through a checklist of things, and everything “kept coming up green.” As such, the team is now ready to pick the mainnet candidate to begin the process of gradual upgrade.

“We’re going to initiate an HFC (hard fork combinator) event on the Testnet,” said Hoskinson. “Testnet will be in the Alonzo stage.”

Ahead of this upgrade, ADA is rallying. Just a week back, ADA hit a new peak at $2.95 and is currently trading at $2.80, making it worth an $89.9 bln cryptocurrency.

While retail has been piling into ADA for some time now, institutions have also taken a liking to it.

According to Coin Shares’ report, last week, Bitcoin had outflows for the 8th consecutive week totaling $3.8 mln while Cardano saw inflows totaling $10.1 million, the largest on record that brings its market share to 0.15%.

Meanwhile, the leading network with smart contracts functionality Ethereum (ETH) represents 32% of total digital asset AUM, seeing $17 mln in inflows last week.

Other competitors Polkadot (DOT) and Solana (SOL), also recorded $1.5 mln and $2.7 mln in inflows. On Monday, Hoskinson praised Solana, which continues to rally to new peaks, on its success, tweeting, “Solana you guys seem to be making waves. Congratulations. Where can I learn more?”

DOT 20.83% Polkadot / USD DOTUSD $ 31.47
Volume 5.43 b Change $6.56 Open $31.47 Circulating 987.58 m Market Cap 31.08 b
8 h Cardano (ADA) Remains A Favorite Among Retail & Institutions Alike with Alonzo Upgrade “On Schedule” 1 d Investors Turn to Ether Competitors, Solana’s SOL Hits 3-Digits to Mark A New ATH 3 d Risky Assets Rejoice: Bitcoin & Gold Spike and Stocks Hit Record High while Dollar Weakens on Powell’s Dovish Speech
SOL -1.86% Solana / USD SOLUSD $ 108.48
Volume 7.59 b Change -$2.02 Open $108.48 Circulating 291.09 m Market Cap 31.58 b
8 h Cardano (ADA) Remains A Favorite Among Retail & Institutions Alike with Alonzo Upgrade “On Schedule” 11 h OpenSea Dominates the NFT Market, Floor Price Continues Its Uptrend as Alameda Apes In, Solana Joins Too 1 d Historically September Records Losses, But Will This Time Be Any Different?
ETH 6.47% Ethereum / USD ETHUSD $ 3,433.73
Volume 27.28 b Change $222.16 Open $3,433.73 Circulating 117.34 m Market Cap 402.9 b
8 h Cardano (ADA) Remains A Favorite Among Retail & Institutions Alike with Alonzo Upgrade “On Schedule” 8 h Ripple Labs Requests Information About Possible SEC Employees’ XRP Holdings 9 h FTX to Offer Derivatives Trading to US Customers Through the Acquisition of CFTC-Regulated Exchange

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Author: AnTy

Ripple Labs Requests Information About Possible SEC Employees’ XRP Holdings

Ripple Labs Requests Information About Possible SEC Employees’ XRP Holdings

Ripple Labs and the US Securities and Exchange Commission (SEC) have been in the midst of a lengthy securities fraud battle since last year, with each party drawing points in the case.

In the latest twist to the legal tussle, Ripple Labs has now requested information from the securities regulator’s own employees.

Trading an Unregistered Security

Earlier this week, James Filian, an attorney who currently follows the legal battle between Ripple Labs and the SEC, announced that the blockchain giant had requested information into the agency’s employees and their XRP holdings.

In a tweet, Filian shared a copy of Ripple’s motion, which seeks to establish whether the SEC cleared its employees to trade XRP.

The motion itself was filed with the U.S. District Court for the Southern District of New York on behalf of Ripple Labs and two of its top executives and co-defendants Bradley Garlinghouse and Chris Larsen.

The document points out that the SEC had previously not taken a regulatory position on securities transactions and only did this on Jan. 19, 2018. During the five-year hiatus, SEC employees were able to buy, sell, and store XRP without any restriction from the regulator.

As the motion document showed, it seeks to get anonymized documents reflecting “trading preclearance decisions” for XRP – as well as Bitcoin and Ether. BTC 0.30% Bitcoin / USD BTCUSD $ 47,166.69
Volume 34.73 b Change $141.50 Open $47,166.69 Circulating 18.8 m Market Cap 886.87 b
7 h Mulls IPO As Crypto Transactions Surpasses $1T Mark 8 h Ripple Labs Requests Information About Possible SEC Employees’ XRP Holdings 9 h FTX to Offer Derivatives Trading to US Customers Through the Acquisition of CFTC-Regulated Exchange
ETH 6.47% Ethereum / USD ETHUSD $ 3,433.73
Volume 27.28 b Change $222.16 Open $3,433.73 Circulating 117.34 m Market Cap 402.9 b
8 h Cardano (ADA) Remains A Favorite Among Retail & Institutions Alike with Alonzo Upgrade “On Schedule” 8 h Ripple Labs Requests Information About Possible SEC Employees’ XRP Holdings 9 h FTX to Offer Derivatives Trading to US Customers Through the Acquisition of CFTC-Regulated Exchange

Considering that the SEC has deemed XRP unregistered security, records of employees having holdings in the asset could put the agency in a compromising position. The defendants added that all their efforts to get these records have proved futile, and a court order seems like the only way.

Filian added that the SEC has until September 3 to respond to the order. He pointed out that with the order being “text-only,” it was the only one filed by the defendants.

Continuing the Months-Long Tit-for-Tat

The Ripple Labs motion comes on the back of a request from the SEC to receive terabytes of internal communication records between Ripple employees. In a motion with the Southern District Court of New York earlier this month, the SEC requested Slack communication records between Ripple employees and executives.

Specifically, the SEC explained that Ripple’s previous Slack communication records were incomplete. Ripple itself admitted that this was due to a “data processing mistake,” although the securities watchdog believes that the company is hiding communications records on purpose. The SEC added that these incomplete records had affected its depositions, which already spanned 11 employees.

The SEC also pointed out that the previous messages submitted had yielded “critically important information” that wasn’t in emails or other communication channels. The remaining records will help its investigations and contribute to its case.

Jeremy Hogan, a popular attorney within the XRP community, has pointed out that the SEC is looking to establish XRP as a security that would immediately fall under its purview.

“It is attacking from the flank and arguing Ripple marketed and treated XRP like a security, and therefore it is. The SEC has had some success with this argument in the past and it makes sense as a strategy since in all substantive ways XRP is NOT a security.”

With Ripple and its executives going on the offensive again, the market will continue to watch how this legal tussle unfolds.

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Author: Jimmy Aki

Robinhood Shares Tumble as SEC Considers Banning Payment for Trades

Robinhood Shares Tumble as SEC Considers Banning Payment for Trades

Robinhood, the crypto-friendly stock trading app, has been beset by one issue or the other – even before the company was listed on the NASDAQ exchange.

The company appears to be in trouble again, with regulators possibly coming for its top revenue generator.

Ban of PFOF ‘On The Table’

Earlier this week, Gary Gensler, Chairman of the Securities and Exchange Commission (SEC), said in an interview that the agency is looking into possibly banning payments for order flow (PFOF). Speaking with Barron’s, Gensler explained that a ban on the controversial practice is on the table, especially with the SEC looking to regulate the financial services industry better.

A highly controversial practice, PFOF is compensation that brokerage firms get for directing orders to different parties in the trade execution process. In exchange for directing trade orders to a particular market maker, brokerage firms will get a cut – usually fractions of a penny per share.

Gensler reiterated the conflict of interest angle in his interview, adding that market makers now make more than just the small spreads on each trade. The regulator chief added that market makers also get data, a first look, and the opportunity to match buyers and sellers out of the order flow.

The news immediately crushed Robinhood, with the company’s stock down 7 percent in the past 24 hours. PFOF makes a significant part of Robinhood’s revenues. While the company has reiterated that it will be able to adapt if rule changes affect the practice, a drop in revenues is never easily forgiven on Wall Street.

PFOF has come under heavy criticism, with a 2000 study by the SEC calling the act a method of transferring trading profits from market makers to brokers that route orders to specialists for execution. The report pointed out,

“Internalization allows a firm to capture trading profits from trading against the firm’s own customers’ orders. However, payment for order flow and internalization create conflicts of interest for brokers because of the tension between the firms’ interests in maximizing payment for order flow or trading profits… and their fiduciary obligation to route their customers’ orders to the best markets.”

PayPal Lurking in the Corner

Gensler’s announcement isn’t the only problem for Robinhood at the moment. Yesterday, CNBC reported that top payment processor PayPal is working on partnering with a broker-dealer to bring stock trading to its users.

Citing anonymous sources, CNBC noted that PayPal had already conducted discussions with several industry players, but the stock trading service might not launch until 2022. With the company looking to get approval from the Financial Industry Regulatory Authority (FINRA) as a brokerage firm, 2021 doesn’t seem feasible anymore.

PayPal has allegedly hired Rich Hagen – a brokerage industry veteran- as part of its play – to lead the upcoming stock trading division. Hagen’s LinkedIn page already shows that he will be responsible for the company’s “efforts to explore opportunities in the consumer investment business.”

With PayPal having more customers than Robinhood and a more recognizable brand in the fintech industry, launching into stock trading will further increase the latter’s profits.

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Author: Jimmy Aki

FTX to Offer Derivatives Trading to US Customers Through the Acquisition of CFTC-Regulated Exchange

FTX to Offer Derivatives Trading to US Customers Through the Acquisition of CFTC-Regulated Exchange

The US is a “huge untapped opportunity.” By combining the forces with the regulated LedgerX that offers futures, options, and swaps on Bitcoin and Ether, FTX.US wants to build the “best-in-class derivatives exchange in the U.S.”

FTX.US, the American affiliate of the global cryptocurrency exchange FTX, has announced the acquisition of the parent company of LedgerX for an undisclosed sum.

LedgerX is a Commodity and Futures Trading Association (CFTC)-regulated crypto derivatives exchange that offers futures, options, and swaps on Bitcoin and Ether. FTX CEO Sam Bankman-Fried said on Tuesday.

“We’re excited to work with the CFTC on innovating in the US crypto derivatives space in a regulated, understood manor(sic). Common ground between regulators and industry is the foundation of safe, sustainable innovation.”

In a recent interview with Insider as well, Bankman-Fried emphasized taking regulation “extremely seriously” and that it’s his biggest focus as the goal is to be “allies rather than enemies of regulators.”

“I just wish that the industry were, as a whole, doing a more conscientious job of interfacing with regulators,” he said, adding that players in the crypto space need to be “responsible and show that they don’t need to have overly paternalistic regulations.”

With the US crypto derivatives market being a “huge untapped opportunity,” both the exchanges want to combine the forces to build the “best-in-class derivatives exchange in the U.S.”

Derivatives Market A Natural Extension

Unlike FTX.US, FTX International already offers derivatives trading and records a $500 billion monthly volume.

With this acquisition, the deal for which can close as early as October, FTX.US will offer the functionality to US-base users, a product line not offered by the exchange’s competitors Coinbase, Gemini, and Kraken.

“We want to plant our flag in something that is uniquely ours,” says Brett Harrison, CEO of FTX.US. “Going into the derivatives market is such a natural extension.”

Much like its global counterpart, FTX.US is also growing fast, managing $350 million in spot volume per day, up from just $1 million in January this year. Still, the exchange has a long way to go, with Coinbase recording $4.6 billion in daily volume, Kraken just over $1 bln, and even Binance.US is managing to have $1 bln in volume.

As for regulated derivatives trading in the US, CME is the major player, currently handling $1.82 bln in open interest on Bitcoin futures and $770 mln on Ether futures.

According to Harrison, FTX.US and LedgerX have similar profiles mainly geared towards institutional clients, with retail only making 30%. But LedgerX does target retail with its small contracts such as bitcoin mini representing 0.01 BTC.

FTX.US’s focus, however, is institutions such as hedge funds and proprietary trading firms, as they don’t want to promote a ‘gamified’ experience. Harrison said,

“It is important to make it clear from the beginning that this is a trading platform…it’s not a game with which to risk everything. And that’s not our goal. We want people to trade safely and responsibly.”

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Author: AnTy

Treasury Seeking More Crypto Reporting Requirements, Global Data-Sharing, in Reconciliation Package

Treasury Seeking More Crypto Reporting Requirements, Global Data-Sharing, in Reconciliation Package

The Treasury Department is looking to add more crypto reporting requirements in the reconciliation bill.

On the one hand, the Treasury wants to introduce more rules for cryptocurrency transaction reporting; on the other hand, the officials of the department have been telling media that the crypto community’s fear about tax provision in the $1 trillion infrastructure bill is unwarranted and that they would clarify that ‘broker’ does not cover those who don’t have transaction data.

The new proposed crypto reporting rules led to a showdown in the Senate as the crypto industry challenged the overreaching definition of ‘broker’ in the bill that covers even those who don’t have any data to report, such as miners and stakers, and developers.

However, the amendment to the bill couldn’t pass, and the original bill is now in the House, which adopted a rule to vote on the package next month that keeps it closed to amendments to avoid having to send it back through the Senate.

Crypto, however, does have allies in both the parties in the form of Senate Finance Chair Ron Wyden, D-Ore.; Senate Banking Ranking Member Patrick J. Toomey, R-Pa.; Sen. Cynthia Lummis and the House’s Blockchain Caucus, whose co-chairs include Rep. Tom Emmer, R-Minn.

According to a report by Roll Call, the Biden administration is urging Democrats to include more rules for tax compliance on crypto transactions in the upcoming $3.5 trillion budget reconciliation package.

This addition would require crypto businesses to report information on foreign accounts holders so that the US can share the information with its global trading partners.

Cryptocurrency exchange FTX CEO Sam Bankman-Fried made the second-biggest contribution of $5.2 million to Biden’s presidential campaign last year.

According to the Treasury, the growth of shell companies that US taxpayers set up overseas to avoid tax, including on crypto gains, needs stricter reporting measures.

In its “Greenbook,” the annual list of revenue proposals, the Treasury had noted that the “global nature” of crypto allows the taxpayers to conceal assets and taxable income and to combat this “third-party information reporting is critical to help identify taxpayers and bolster voluntary tax compliance.”

Crypto exchange Kraken CEO Jesse Powell doubted the legality of the latest move, saying, “Why don’t the foreign agencies just ask us for the info directly, as they have been for the last decade.” Jerry Brito, executive director of CoinCenter, said,

“We don’t object to crypto tax reporting requirements (indeed, we’ve asked for reporting guidance for years); we object to last-minute additions to “must-pass” bills outside regular order and with little or no public input.”

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Author: AnTy

PayPal Is Now Exploring Stock Trading After Crypto to Capitalize on Retail Trading Boom

PayPal Is Now Exploring Stock Trading After Crypto to Capitalize on Retail Trading Boom

After rolling out the ability to trade cryptocurrencies, PayPal is now exploring stock trading.

The payments giant, which has more than 400 million accounts worldwide, has been exploring ways to let users trade individual stocks, reported CNBC, citing sources familiar with the plans.

As part of this move, the California-based company recently hired brokerage industry veteran Rich Hagen is now the CEO of the ‘Invest at PayPal’ division previously unreported.

Just last week, PayPal expanded its crypto services beyond the US and into the UK. Jose Fernandez da Ponte, PayPal’s general manager for blockchain, crypto, and digital currencies, noted that customers in the UK who have bought crypto through its platform log in twice as often as those who haven’t.

“We expect digital currencies to play an important role in consumer payments over the longer term.”

According to Nigel Green of financial services firm deVere Group, cryptocurrencies will replace traditional money. Though that time is yet to come, he said PayPal’s announcement is “yet another example that exposes cryptocurrency deniers as being on the wrong side of history.”

“This is a major step forward towards the mass adoption of digital currencies. More and more payment companies will naturally follow their lead.”

Retail’s the Way

Earlier this year, at the company’s investor day, PayPal CEO Dan Schulman had spoken about including more financial services including “investment capabilities” as a long-term vision for the company.

This move comes amidst the explosion of retail trading propelled by lockdown during the pandemic and fiscal stimulus released by the governments. According to JMP Securities estimates, more than 10 million new individual investors entered the market in the first half of 2021.

Trading has become a booming business with PayPal competitors Square offering crypto and stock trading through its Cash App. Robinhood has also seen explosive growth with over 22.5 million customers and doubling revenue in Q2 from a year ago, with crypto accounting for an increasing percentage of it.

Much like with crypto, PayPal wants to capitalize on the trend, but the service is unlikely to be rolled out this year though they are already having discussions with potential industry partners.

This retail trading boom is also leading to more regulatory scrutiny, with the US Securities and Exchange Commission (SEC) saying last week that it is stepping up its inquiry into “gamification.”

PayPal (PYPL) stocks are up over 5.5% in the last 3-days of trading at $288.47, near its all-time high of $310.16 from late July.

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Author: AnTy

Fantom Sees an Avalanche of New Activity to Hit Records, Announces Rewards to Build on the Platform

Fantom Sees an Avalanche of New Activity to Hit Records, Announces Rewards to Build on the Platform

The layer-1 platform is processing more than a million transactions and recording 16.5k FTM in fees as TVL hits $750 mln and FTM token nears $0.95 peak.

Layer 1 platform Fantom (FTM) is following the footsteps of Polygon (MATIC) and Avalanche (AVAX) as it announced ecosystem-wide liquidity mining.

Like very recently, AVAX benefited immensely from its program by pumping more than 500% in just over a month; FTM has now taken to rallying.

In a matter of just four days, FTM has surged over 110% to above $0.88. As of writing, FTM is trading at $0.83, still down 12% from its all-time high in early May at roughly $0.95.

The rally came as the project announced a 370 million FTM incentive program for builders. “If you’re a protocol team, we’ll reward you for sustaining and increasing your TVL on Fantom,” it said.

With liquidity mining getting popular, the Fantom team notes that they have been asked to provide rewards to its users willing to deploy on top of the chain. They noted,

“We believe that playing by the book doesn’t warrant different results. Therefore we have decided to introduce a different kind of program to better align incentives between users, builders, and the network.”

Starting this Monday, the protocol has committed 370,000,000 FTM to the program. A protocol can apply to avail of the rewards if their TVL on the protocol stays above a time-weighted average of $5-$100 million for an extended period.

Since Friday, the total value locked (TVL) on the protocol has gone from just under $440 million to $750 million on Monday. At the beginning of May, the TVL on Fantom was under $2.9 mln which has now reached just above $683 mln, according to DeFi Llama.

SpookySwap accounts for 29.5% of this TVL, followed by Curve, Scream, and SpiritSwap, with Cream Finance at 8th place, while Sushi has deployed $5.3 mln as well.

The liquidity mining program and the subsequent surge in FTM prices have resulted in the platform recording more than 1 million in daily transaction count.

The number of transactions on Fantom has exploded to a peak of 1,169,019 transactions on August 30, from just over 263k last week.


The same is the case for transaction fees on the platform, which kept around 5k FTM every day when it posted a massive increase to 67,588 FTM on Monday. The ATH before that was 16,582 FTM on May 23, 2021, according to FTMScan.

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Author: AnTy

Gold-Focused Investment Manager Discloses Exposure to Bitcoin via GBTC

Gold-Focused Investment Manager Discloses Exposure to Bitcoin via GBTC

Investment manager, US Global Investors, which is well-known for specializing in gold and precious metals, disclosed in its latest regulatory filing with the Securities and Exchange Commission (SEC) that it now has exposure to Bitcoin.

The Texas-based company added GBTC shares in three of its funds viz Gold and Precious Metals Fund; Global Resources Fund; and World Precious Minerals Fund.

For the quarter ending June 30, the company reported owning 19,000 shares of Grayscale Bitcoin Trust (GBTC), currently worth just under $740k.

According to the document, the company further categorizes the investment type to be “Equity-common.”

GBTC is currently trading at a discount of 13.94% to the underlying Bitcoin’s price. This discount has been prevailing for the last six months, going as far as 21.23% in mid-May.

While it may come as a surprise that a gold favored firm is investing in cryptocurrency, gold bug Peter Shiff said, “this is not a surprise nor does it indicate a shift in the way other gold equity managers view crypto or Bitcoin,” noting that the CEO of US Global Investors, Frank Holmes is also the CEO of Hive Blockchain and has been active in crypto since 2017.

Ever since Bitcoin’s creation in 2009, which is currently worth more than $48k, gold has only grown from $890 to $1,815, representing a growth of only about 115%. In early August last year, the precious metal did hit a new all-time high but could only reach $2,075, while BTC went to nearly a $65k peak in April this year.

Bitcoin is still up 14.5% in August and 64% YTD compared to bullion’s -0.19% and -4.46% performance, respectively.

The institutionalization of Bitcoin and crypto has been happening at a rapid pace this year in the aftermath of pandemic and ultra-loose monetary policy, which led to a surge in inflation while the central banks keep the interest rates virtually zero or in the sub-zero territory.

As we reported recently, Bill Miller also reported owning 1.5 million shares of GBTC in its Miller Opportunity Trust, and Morgan Stanely disclosed that it owns a huge amount of GBTC shares as well.

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Author: AnTy