Galaxy Digital Reports $860M in Net Income in Q1 2021 and Surpasses $1 Billion in AUM

Galaxy Digital Reports $860M in Net Income in Q1 2021 and Surpasses $1 Billion in AUM

Mike Novogratz’s Galaxy Digital reported a profitable Q1 2021 with $860.2 million in net comprehensive income, a complete turnaround from the $27 million loss in Q1 2020. Novogratz, founder, and CEO of Galaxy Digital said,

“Galaxy Digital reported another consecutive record quarter, as net comprehensive income grew to $860 million from $336 million in the prior quarter.”

Income from the company’s trading business increased to $508.7 million, while net realized gains from investments were $151.1 million in the quarter.

The firm made 12 new investments in the quarter and now holds about 80 investments across approximately 60 portfolio companies.

In Q1 of 2021, during the bull market, Galaxy Digital reported an increase of 50% in trading volumes from the last quarter and a surge of 510% in gross counterparty loan originations to $670 million.

Galaxy Digital Trading also onboarded over 100 new counterparties in the quarter. The firm further launched several products in this period, including a Bitcoin ETF and an Ether ETF.

As of March 31, 2021, the company had $1.27 billion in assets under management.

In the Bitcoin mining realm, Galaxy started hosting its machines at a third-party data center in the United States and expects to achieve up to 1,995 Petahash per second (PH/s) of mining capacity delivered monthly by the end of next year.

The company has appointed Erin Brown as its Chief Operating Officer, who previously served as Chief Risk Officer at Jump Trading. Novogratz said,

“Beyond delivering dramatic organic growth, we announced we would acquire BitGo, which will establish Galaxy Digital as the first full-service digital asset financial platform for institutions and ensure our business is aligned with broader institutional adoption.”

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Author: AnTy

Software Provider Temenos Enables Crypto Trading for Banks

Banking software provider Temenos has announced a partnership with online digital asset firm Taurus to enable access to cryptocurrency for financial institutions.

Per its press release, the integration would make it easier for banks to offer cryptocurrency trading to their clients via Taurus’ platform.

Temenos Leveraging Taurus Blockchain Expertise

This will see Temenos’ banking clients exposed to a plethora of blockchain solutions like Taurus-CAPITAL (tokenization and lifecycle management), Taurus-PROTECT (hot, warm, cold digital asset custody), and Taurus-EXPLORER (API-based blockchain connectivity to ten blockchain protocols).

All this will now be accessible through the Temenos MarketPlace.

Temenos notes that Taurus was selected after a thorough review and evaluation process to help banks seamlessly integrate all forms of digital assets across cryptocurrencies, tokenized assets, and digital currencies.

Taurus will be integrated with Temenos’ next-generation core banking software called Temenos Transact.

Speaking on the occasion, Managing Partner at Taurus Sebastien Dessimoz noted that there had been an increase in demand for digital assets since 2020.

According to Dessimoz, Taurus’ blockchain expertise would aid Temenos clients in managing any digital asset and creating digital products easily.

Geneva-based Taurus received a securities license from the Swiss Financial Market Supervisory Authority (FINMA) to launch the regulated crypto marketplace dubbed the Taurus Digital Exchange (TDX).

Taurus said that TDX would enable investors and banks to trade tokenized securities, private assets, real estate, art, non-fungible tokens (NFTs), and cryptocurrencies.

Taurus is a seasoned blockchain company as it offers services for cryptocurrencies, including staking and decentralized finance (DeFi), tokenized assets, and digital assets, all within its platform.

Taurus Integrates Aave

Taurus has continued to grow its product suite. In March 2021, the Swiss digital asset provider added DeFi protocol Aave to its asset infrastructure. The integration would enable banks and exchanges to deposit and borrow cryptocurrencies like Ether.

Aave, a DeFi protocol catering to both institutional and retail users, facilitates borrowing and lending of digital assets has experienced exponential growth alongside the broader crypto market.

Banks are gradually warming up to decentralized finance (DeFi) protocols like Aave, as the amount of funds locked up in DeFi protocols rises above the $80 billion mark, per DeFi Pulse.

In a research paper published earlier this month by Netherlands-based ING Bank, it was agreed that both centralized and decentralized financial systems need to co-exist to achieve success. The paper states:

“Although DeFi currently appears to be a domain on its own, we envision that centralized and decentralized financial services will converge at some stage as both have unique capabilities that are beneficial to the other. There is, however, the challenge for centralized institutions of making sure that their assets stay within countries that are white-listed.”

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Author: Jimmy Aki

Diginex’s Crypto Custodial Arm Digivault Bags Approval From UK FCA

Digivault, the custodial arm of Singapore-based digital assets company Diginex, has been granted approval to register as a cryptocurrency custodian wallet provider from the UK Financial Conduct Authority (FCA).

Digivault Approved By The FCA

The firm announced in a statement released today that the regulatory approval is in line with the Money Laundering, Terrorist Financing, and Transfer of Funds (Information of the Payer) Regulations.

With this FCA approval, Digivault hopes to further provide compliant and secure custody services to corporate and institutional investors in crypto assets.

Speaking about what this feat means for Digivault and in turn, Diginex, the CEO of Diginex Limited, Richard Byworth, said the FCA approval is continued validation of its strategy to deliver fair, transparent, and compliant crypto products for institutions. He added that,

“Digivault’s market-leading custody solution is a foundational pillar of the Diginex ecosystem and acts as a key enabler to the EQUOS Exchange, OTC, and Lending business lines.”

According to the firm, its custody solutions include having digital assets in cold storage third-party vaults owned by renowned vault services provider, Malca-Amit.

Digivault provides both cold and warm storage, incorporating a series of hardware and software firewalls so that assets are protected yet readily available.

Assets available for custodial services in the company include Bitcoin, Ethereum, and USDC, and other assets hosted on ERC-20 and ERC-1400 protocols.

Commenting on the approval Rob Cooper, CEO of Digivault, said the backing of the FCA would help assure its clients that their assets are being secured within the highest possible standard of governance, control, and oversight.

Digivault’s regulatory approval from the UK financial watchdog follows its newly signed partnership with Torstone Technology, a post-trade securities, and derivatives processing provider.

The partnership is aimed at providing Digivault’s clients with post-trade services via Torstone’s settlement platform and at the same time enable Torstone’s customers to access digital asset custody solutions.

FCA’s Stance On Crypto Assets

The FCA has never been so keen on cryptocurrencies. For years, the regulator has made its concerns regarding digital assets known.

In October, the FCA declared that companies in the UK could no longer offer crypto derivatives products, including futures and exchange-traded notes.

Just recently, the FCA chief Nikhil Rathi advised young investors to avoid the crypto craze amid the soaring popularity of the likes of Bitcoin. He said that direct investment in crypto assets is a high risk, with few regulatory protections, which is why it is not advisable.

Meanwhile, Digivault happens to be the first stand-alone digital asset custodian approved by the FCA. Its parent company Diginex which went public in October 2020, was the first digital assets group with a crypto exchange to launch on Nasdaq in the US publicly.

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Author: Jimmy Aki

Israel Releases Working Paper on Possible Digital Shekel Program

Israel Releases Working Paper on Possible Digital Shekel Program

Israel is continuing with its exploration of the likely issuance of its central bank digital currency (CBDC), the digital shekel, per an official statement,

Bank of Israel Accelerates CBDC Research Efforts

This follows the release of a working paper that requires feedback. Despite its reluctance to commit to a CBDC plan, the Bank of Israel said it was only preparing an action plan, which will ensure its preparedness to launch a CBDC if the situation arrives.

The action plan would prepare it to launch the digital fiat should the benefits outweigh the costs and potential risk. Its impact could be enormous on the existing monetary system.

The working paper details a draft model for a potential CBDC and how it would operate. It details the role of the apex bank and how it would handle issuance. Local payment service providers will be tasked with distributing the CBDC. Payment providers will also be tasked with offering enhanced functionality for the CBDC, including building the technology.

The bank believes a CBDC would allow a payment system that could adapt to a digital economy and create an efficient and inexpensive infrastructure for cross-border payments. It also thinks the digital shekel can usher in a cashless society.

Israel Remains Wishy-washy on CBDC

The Bank of Israel first started examining the possibilities of a digital currency in 2017. At the time, the governor set up a group to explore the issue. Still, a year later, the central bank announced that it was not issuing one because no advanced economy had issued a digital currency.

While countries like Israel continue to slowly research and tread carefully to issue a CBDC, numerous central banks worldwide actively explore the project with increased zeal.

China has long started piloting its digital yuan project in major cities across the country. Banks in cities like Shanghai have been active in promoting the digital yuan, persuading merchants and retail clients to download digital wallets and use the digital currency.

Norway is also another country exploring CBDCs. It recently disclosed that it would start testing technical CDBC solutions. Other countries like South Korea, Japan, and the United Kingdom are positioning themselves for a potential CBDC.

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Author: Jimmy Aki

VanEck’s Latest ETFs Starts Trading on London Stock Exchange and Deutsche Boerse

The index tracks the prices of 26 pure-play digital asset companies, notably Galaxy Digital, Square, Voyager Digital, Riot Blockchain, Nvidia, Silvergate Capital, and others, with the US making up about two-thirds of allocation, followed by China, Canada, Germany, Taiwan, and the UK.

While the decision on VanEck’s Bitcoin ETF in the US has been postponed by the SEC, the company has launched Europe’s first thematic exchange-traded fund that offers exposure to companies involved in digital assets.

The VanEck Vectors Digital Assets Equity UCITS ETF (DAPP) that tracks the recently launched MVIS Global Digital Assets Equity index is listed on the London Stock Exchange and Deutsche Boerse.

Instead of investing in crypto assets directly or indirectly, this index includes trading platforms, miners, bankers, payment gateway operators, and other companies that provide the infrastructure.

In mid-April, VanEck rolled out the same product in the US, DAPP US, listed on Nasdaq, which currently manages $25 million in assets.

The index tracks the prices of 26 pure-play digital asset companies with notable positions, including Galaxy Digital (9.2%), Square (8.6%), Voyager Digital (7.6%), Riot Blockchain (6.1%), Marathon Digital (6.1%), Nvidia (5.4%), and Silvergate Capital (5.3%).

In terms of country, stocks from the US presently make up nearly two-thirds (64.0%) of the total index allocation, with the remaining weight distributed across China (11.8%), Canada (11.6%), Germany (4.9%), Taiwan (4.6%), and the UK (3.1%).

According to VanEck, the companies included in the ETF’s index have seen their revenue accelerate rapidly in 2020 to surpass $10 billion, up from $5bn in the previous two years. Martijn Rozemuller, CEO in Europe at VanEck said,

“The digital transformation is changing large parts of our economy. This is not just short-term hype, but rather is a long-term, structural development. Blockchain applications are finding more areas of use that now extend way beyond cryptocurrencies. Consequently, investors are increasingly looking to digital assets for investment opportunities.”

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Author: AnTy

Georgia’s Apex Bank Considers CBDC, Calls For Partnerships

Central bank digital currencies (CBDCs) have become the rave of the moment following the global outcry for a more efficient and inclusive financial system.

With the economic impact of the pandemic, the need for a digital form of value transmission has never been higher than now. National banks are rapidly rolling out CBDC programs to address this growing demand.

The latest in a long list of apex banks is the National Bank of Georgia.

Digital Gel On The Horizon

In a release posted on its website, the National Bank of Georgia (NBG) said it would be commencing a central bank digital currency (CBDC) program joining a list of national banks in the process.

According to the apex bank, this enhances the domestic payment system efficiencies and promotes financial inclusion for the underbanked in the country. To help it on this journey, the NBG said it would be accepting participants from the private sector.

In what is termed as a public-private partnership (PPP), it said private technology firms, fintech companies, and other interested financial institutions are welcome to aid in creating a “digital GEL,” named after the country’s official currency, the Georgian Lari.

However, the apex bank warns that despite its crypto efforts, its first mandate to maintain price and financial stability in Georgia remains. The official announcement says,

“CBDC holds the promise to unlock the tremendous value of innovative business models for the benefit of society. The introduction of CBDC could increase financial intermediation efficiency, help introduce new financial technologies, facilitate financial inclusion, and reach previously unbanked populations. It could also increase monetary policy efficiency by improving monetary policy’s monetary transmission mechanism and welfare effects for the society.”

The former Soviet region financial regulator said that it would be adopting the Bank for International Settlements’ (BIS) 2020 guiding principles in creating a Digital GEL wherein a set of rules for a successful CBDC program was listed.

Also, it noted that there were inherent risks attributed to CBDCs given the fact that it is a completely new and potentially disruptive technology. To ensure sound risk management, it would be creating a regulatory sandbox for potential partners to test the CBDC deployment in a controlled environment. This will see it use its Open Regulatory Framework tools to measure the economic impact of a possible CBDC use.

Meanwhile, no launch date has been chosen, and the project is still in the works.

Georgia’s Impressive Crypto Resume

Given its small population size of just 3.7 million people scattered across its Mountain Villages, Georgia is one of the smaller economies looking to join the CBDC frenzy.

But this does not make it negligible, given that the Georgian state has been active in the crypto space as far back as 2017.

In a move that saw it become the first national government to allow land authentication with blockchain, the Georgian state signed an agreement with BitFury to use the Bitcoin network to record land titles.

It also became the powerhouse of European crypto mining after hosting the world’s third-largest crypto mining operation. It also went further and concluded a deal with Cardano’s parent company IOHK in 2019 to aid in public sector administration, especially in education.

These decisive steps have since brought the Georgian state into the global blockchain community. They have since made former Prime Minister Mamuka Bakhtadze remarked that blockchain could do what the steam engine did for the first industrial revolution in an interview with Cointelegraph. According to Bakhtadze, blockchain could become the catalyst for the fourth industrial revolution.

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Author: Jimmy Aki

Fidelity Launches Digital Asset Analytics Tool For Institutional Investors

Financial services firm Fidelity investment has launched a digital assets analytics platform for institutional investors.

Fidelity’s Sherlock To Guide Institutional Investors

Fidelity named the platform Sherlock, which is a digital assets analysis tool that will provide fundamental and technical analysis for fund managers and investors.

According to the firm, Sherlock will collate valuable pieces of information on the blockchain, market, social sentiment analysis, as well as industry news into a single portal.

The platform will also research crypto-assets relying on quality institutional data providers coupled with the provision of unique analytics to guide investors.

Fidelity’s Sherlock is expected to provide much-needed competition against existing solutions produced by companies like Messari.

In 2018, Messari launched a data solution service and had gained valuable recognition worldwide by integrating with Kaiko’s Rest API.

Other giant forces to be reckoned with in the provision of data and analytics are Dune Analytics, Glassnode, Skew, Coin Metrics, and Santiment.

Speaking on the new development, Kevin Vora, Vice president, Product Management, Fidelity Center for Applied Technology (FCAT), said Sherlock would deliver comprehensive data and deep analytics as clients will no longer face numerous irrelevant resources.

Fidelity Dominating the Crypto Space

Besides developing Sherlock to help institutional investors, Fidelity investment has been making significant contributions to the crypto space.

Earlier, Fidelity Charitable, the charitable arm of the mutual fund giant, reportedly raised $28 million in cryptocurrency donations.

The acceptance of cryptocurrencies as part of donations for the non-profit was a welcome development in the crypto space.

More importantly, the investment firm plans to launch its bitcoin exchange-traded fund (ETF) for digital assets and virtual currency, per Form S-1 filed with the Securities and Exchange Commission.

While SEC is yet to approve any firm to date, Fidelity might be feeling lucky due to its track record in the traditional finance space.

Given the prevalence of existing data and analytics solutions for institutional investors, observers will be eager to see if the newly introduced Sherlock solution by Fidelity investment will also turn things around.

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Author: Jimmy Aki

SEC Commissioner Hester Peirce: Stablecoins May Be USA’s Answer to China’s Digital Yuan

SEC Commissioner Hester Peirce: Stablecoins May Be USA’s Answer to China’s Digital Yuan

Meanwhile, the Fed Chair is in no rush to issue a digital dollar either as the focus is on doing it right than doing it fast.

China’s digital yuan will not overthrow the dollar’s reign, said a top US Securities and Exchange Commission official (SEC). And this is because of the growth of dollar-backed stablecoins.

Central banks around the world are working on the digitized version of their fiat currency with an aim to improve the payments system.

The People’s Bank of China (PBOC) is leading this race of a central bank digital currency (CBDC) as it extends the trials of digital yuan to more cities and even across borders in Hong Kong.

This fast pace of China has some worried that the yuan could gain dominance over the dollar, the world’s leading reserve currency. But according to Hester Peirce, aka “Crypto Mom,” the rise of stablecoins wouldn’t let that happen. she said,

“Even in 2021, there’s been a tremendous growth in stablecoins – these are essentially private digital dollars.”

“That, effectively, may be our answer to the Chinese CBDC (central bank digital currency). It may be just private stablecoins.”

“If they’re dollar-backed, then I think that the dollar will still be quite relevant,” said Peirce during a digital currency event.

According to the International Monetary Fund, the dollar accounted for almost 60% of the world’s official foreign exchange reserves at the end of 2020, while China’s share is just 2.25%.

Stablecoins, meanwhile, are on their way to surpass $100 million in market cap, with Tether the dominant stablecoin has a market cap of $51 billion alone, which is managing over $20 billion in trading volume every day. Tether’s on-chain volume has reached $754 billion YTD, already 2% higher than the total volume transacted in 2020, per IntoTheBlock.

On the topic of a digital dollar, Federal Reserve Chairman Jerome Powell said this week that China’s digital yuan plans wouldn’t push them to rush its own CBDC plans, adding that China’s approach won’t work in the US.

“It is far more important to get it right than it is to do it fast,” Powell said.

“The currency that is being used in China is not one that would work here. It’s one that really allows the government to see every payment for which it is used in real time.”

The US central bank is taking its time to understand digital currencies, he said. “Central bank digital currencies are now possible,” Powell said.

“We need to understand whether that is something that would be a good thing for the people that we serve.”

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Author: AnTy

Grayscale Buys A Stake in ClearShares; Helps Them Convert ‘PIFI’ to ‘BTC’ ETF

The world’s largest digital asset manager, Grayscale Investments, has purchased a stake in a little-known ETF provider, ClearShares.

This is the same company that we reported this week filed with the Securities and Exchange Commission (SEC) to change its ticker from “PIFI” to “BTC,” effective from April 16, 2021.

What had been looking like a company trying to ride the coattails of crypto success, as ClearShares Piton Intermediate Fixed Income exchange-traded fund has no involvement with the industry, it turns out it was Grayscale’s attempt at a Bitcoin ETF.

Recently, the asset manager, which surpassed $50 billion in AUM, shared its intention to convert Grayscale Bitcoin Trust (GBTC) into an ETF. GBTC, which has $41.5 billion in assets under management, is on track to take over the world’s largest commodity, ETF GLD, which has $57 billion in AUM.

Grayscale had purchased a stake in the $32 million ClearShares ETF, which is involved in buying investment-grade corporate bonds, U.S. government agency bonds, and Treasuries.

“Grayscale has taken an ownership stake in ClearShares as part of its long-term commitment to bring digital currency ETFs to market, with the potential to collaborate on products with investment strategies related to the digital currency industry,” spokesperson Seres Lu has been reported as saying.

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Author: AnTy

Sotheby’s Sold Digital Artwork by Pak for $16.8 Million Along with a Single Pixel NFT for $1.36 Mln

Sotheby’s Sold Digital Artwork by Pak for $16.8 Million Along with a Single Pixel NFT for $1.36 Mln

Sotheby’s hosted its first digital art sale that fetched $16.8 million.

The non-fungible token (NFT) was created by anonymous digital artist Pak, the auction house said on Wednesday. It also sold an image of a single-pixel for $1.36 million.

The sale of the artwork was accepted in Ether (ETH) along with via debit or credit card.

Just a month back, rival Christie’s sold its NFT, “Everydays: The First 5,000 Days,” by digital artist Beeple for $69.3 million, which was all paid in Ether cryptocurrency. ETH 3.60% Ethereum / USD ETHUSD $ 2,523.06
$90.833.60%
Volume 32.2 b Change $90.83 Open $2,523.06 Circulating 115.48 m Market Cap 291.37 b
3 h European Banking Giant, Société Générale, Issues Security Token On Tezos Blockchain 3 h Gitcoin Spins Out of ConsenSys After Raising Over $11M in a ‘Strategic’ Capital Move 4 h Bitcoin Payment Network, BitPay, Joins Square-Led Crypto Open Patent Alliance (COPA)

According to the site NonFungible.com, $2 billion has changed hands through the NFT market in the first quarter of 2021 alone.

Called ‘The Fungible’ Collection,” the digital artwork sold by Sotheby’s includes a series of digital cubes which collectors could buy for $500 to $1,500 each, then receive NFTs based on the number of cubes they own.

The NFT of an image of a single pixel called “The Pixel” also fetched $1.36 million on the auction after 90-minute bidding.

This sale was particularly targeted toward “crypto-native collectors, said Max Moore, contemporary art specialist at Sotheby’s.

“These new crypto investors have a very different aesthetic and a very different taste profile than a traditional collector would, and so it’s important to provide a mix and a range of collectibles at Sotheby’s to attract a wide variety of audiences.”

The sale of the digital artwork took place on the crypto exchange Gemini owned Nifty Gateway.

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Author: AnTy