Grayscale’s Record-Breaking Q2 Sees Influx of New Investors; GBTC Inflows 118% of BTC Mined

Grayscale reported yet another record quarter with the most massive quarterly inflows at $905.8 million in Q2 2020, a quarter characterized by unprecedented global events, which is almost double the inflows recorded in Q1 2020.

This demand shows investors are increasingly looking to diversify their portfolios amid aggressive monetary and fiscal intervention resulting from the COVID-19 crisis, reads the report. And the record inflows make it difficult to ignore the “shift in sentiment towards digital assets from individual and institutional investors alike,” it said.

Both Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE) had record quarterly inflows; the latter one accounted for 15% of total inflows into the Grayscale products. ETHE was the reason demand for Grayscale products excluding Bitcoin grew to $154.7 million in 2Q20, up 35% QoQ, and up over 649% from 2Q19.

Even Grayscale Litecoin Trust saw its largest inflows to date, while the one providing exposure to Bitcoin Cash had its largest inflow since 2Q18.

Grayscale AUM
Source: Grayscale

Also, inflows into Grayscale products over six months surpassed the $1 billion thresholds for the first time ever, “demonstrating sustained demand for digital asset exposure despite a backdrop characterized by economic uncertainty.”

According to Grayscale, GBTC inflows actually exceeded newly mined bitcoin, which was cut down by 50% post-halving, a phenomenon widely circulating in the market.

Apparently, inflows into GBTC were proportional to almost 70% of all Bitcoin mined during Q2 2020, which increased to 118% after Bitcoin completed its third halving in May 2020.

The company noted that this significant reduction in the supply-side pressure might be “a positive sign for Bitcoin price appreciation.”

Grayscale BTC Flows
Source: Grayscale

However, the company still did not mention how much of these purchases were “in-kind,” which was last disclosed at “58% of total quarterly contributions in 3Q18, 71% in 2Q19, and 79% in 3Q19.”

The positive thing is that $124 million of inflows were from new investors who made up 57% of its investor base while 81% were returning institutional investors. This time these investors were more heavily weighted to offshore investors.

Overall, the majority of the investment that is 85% came from institutional investors who were dominated by hedge funds.

Read Original/a>
Author: AnTy

Japan’s Govt. Is Strongly Considering Launching A CBDC In Cooperation With The US and Europe

Japan is increasing its efforts in developing a central bank digital currency (CBDC), reported the largest financial paper in Japan, Nikkei on Wednesday. The post further confirms that the Japanese government plans to add the development of a digital yen into its policy framework this year.

Governments and central banks are looking at digital payments and currencies more seriously in a bid to plan for future financial systems. With China and Russia leading the field of digital payments, Japan is trying to catch up on developing its own.

Lawmakers in the country have long been calling for regulations and policies to be set in developing a digital yen. Moreover, cooperation with the US and Europe is on the cards to build a local electronic payment system.

Earlier this month, the Bank of Japan (BoJ) released a technical study report on launching a digital yen but said they had no plans to launch it soon. The BoJ has had a knack for CBDCs and digital payment systems for a while now since China’s announced it’s digital yuan is nearly complete.

Other top banks in the country are also exploring the digital asset world as seen with the recent joining of three top Japanese banks – Mizuho Financial Group, Sumitomo Mitsui Financial Group and Mitsubishi UFJ Financial Group (MUFG) – to a crypto exchange-led study group.

Read Original/a>
Author: Lujan Odera

“Economy Dying, Fed Incompetent,” Invest In Gold, Silver, Bitcoin: Rich Dad Poor Dad Author

Last week we reported Congress passed another $3 trillion coronavirus relief package after having spent $3 trillion already. But this won’t be enough and according to Fed chairman, Jerome Powell, both Congress and Fed would have to do more.

But worry not, because Fed isn’t out of ammunition, “not by a long shot.” They have interest rates to slash or better yet the unlimited money printing that they have already been doing. As Powell said on Sunday on CBS News,

“As a central bank, we have the ability to create money digitally.”

But not everyone agrees with Powell’s tools to prop the economy back. “ECONOMY dying. FED incompetent. Next BAILOUT trillions in pensions. HOPE fading,” said ‘Rich Dad, Poor Dad’ author Robert Kiyosaki.

According to him, the three investments to “prepare for the worst” are bitcoin, gold, and silver. And he expects all three of them to experience a jump in price in the coming years. As per his prediction, gold will rise 43% within a year to $3,000 and silver 135% to $40 in five years.

Bitcoin, the deflationary cryptocurrency with a limited supply, is expected to jump the highest 665% to $75,000 in the next three years.

Kiyosaki has long been a bitcoin supporter and has been calling for investing in these scarce assets.

While the money supply only continues to rise, last week, Bitcoin had its third halving that cut down miners’ reward in half and reduced its inflation to 1.8%.

“The rest of the world needs to either keep printing money or see their own currency eroding drastically in front of the unbeatable dollar,” said Jean-Marie Mognetti, chief executive officer of CoinShares.

“Bitcoin, a digital currency whose supply is programmatically defined to reduce until it reaches its maximum supply, would seem to be the perfect hedge for any institutional investor portfolio.”

Recently macro investor Paul Tudor Jones also became a bitcoiner and has almost 2% of his assets in the digital asset which according to him is an inflation hedge.

Read Original/a>
Author: AnTy

CoinMarketCap Finds the Solution to “Fake/Suspicious” Volume

In 2019, it was reported that 95% of the bitcoin trading volume is fake.

About a month after that, CoinMarketCap said they are “working hard to build constructive solutions to address volume concerns.”

Now, a year since the report came, CoinMarketCap has found the solution to tackle this issue.

Over a month after the leading spot exchange Binance acquired CMC in a $400 million deal, the crypto data tracker has exchanged the “volume” criteria for ranking cryptocurrency exchanges with the web traffic category.

à la ‘If you don’t have a solution, change the question!’

Real Volume? Remove suspicious volume!

Interestingly, the day Binance acquired CMC, the exchange was ranked 15th with a reported volume of $6.7 billion. However, the adjusted volume, a metric to exclude data that is “skewed or potentially suspicious,” reported just over $2 billion.

But this metric is now removed from the site.

And based on the new metric, Binance got the top spot!

“What did you think was gonna happen? Six weeks in and binance acquisition of CoinMarketCap already being abused to manipulate the rankings,” called out analyst Mati Greenspan.

Greenspan has been against Binance’s decision to acquire CMC from the start which he said is “buying out the ranking site in order to manipulate your way to the top.”

Source: CoinMarketCap

According to Binance founder and CEO Changepeng “CZ” Zhao, the new rankings are “better than before,” and he finds it useful as “I can finally have a clear view of the field and see who the real upcoming exchanges are.”

With the new metrics, “We strive to maintain a high standard for data transparency and integrity in our industry,” he said.

Read Original/a>
Author: AnTy

Decentralized Exchange Bisq Loses 3 Bitcoin (BTC) and 4,000 XMR ($230k) in an Attack

The decentralized bitcoin trading network Bisq has reported an attack that resulted in the loss of 3 BTC worth nearly $22,000 and 4,000 XMR worth $224,000. The open-source, peer-to-peer exchange that requires no registration to trade cryptos suffered an attack 24 hours ago where the attacker exploited a flaw in Bisq’s trade protocol.

The attacker targeted individual trades to steal trading capital and the markets affected were only the XMR/BTC one. All the affected trades occurred over the past 12 days. As per the information so far, about 3 BTC and 4,000 XMR are stolen from 7 different victims. The exchange is planning to create a proposal in the BisqDAO, the platform’s funding mechanism, to repay the 7 victims from future trading revenues.

In late October 2019, Bisq updated its trade protocol with the release of Bisq v1.2 which improved decentralization by removing the arbitrators with a “3rd key in the multisig escrow” which is used for bitcoin trading funds. The arbitrators were replaced with mediators and arbitrators with no keys.

As it didn’t require any trusted third parties, the trade parties have to move bitcoin trade funds to a Bisque “donation address” after a hard time limit. This donation address is set by the Bisq DAO and approved by its stakeholders. The statement reads,

“This exploit was the result of a flaw in the way Bisq trades are carried out, not in the way funds are stored (i.e., there is no honeypot since Bisq is P2P).”

On discovering the attack, all trading was disabled on the platform by using the alert key, an “unprecedented” case because it was used for the first time in its four years of operating on mainnet. The flaw has been now corrected with the release of the new version Bisq v1.3.0.

Read Original/a>
Author: AnTy

BitMEX Slams Competing Derivative Exchange FTX After CEO Tweets “Conspiracy Theory”

  • BitMEX reported a “hardware issue” causing “requests to be delayed” after the bloodbath
  • Competitor Exchange FTX’s Sam Bankman-Fried’s theory that there was no such issue and BitMEX was responsible to Bitcoin’s crash
  • If BitMEX hadn’t gone offline, Bitcoin would have gone to zero, said Bankman-Fried but later apologizes for suggesting it

Bitcoin price crashed to $3,850 on spot exchanges yesterday but on crypto derivatives exchange BitMEX, it went even lower to $3,600.

As the price went down to an early February 2019 level, the platform halted trading on account of “system instability.”

Traders reported experiencing a system crash around following a massive market-wide sell-off that had the leading digital currency losing 40% of its value in a single 1-day candle.

A few hours later, BitMEX released a statement on Twitter describing the outage as a “hardware issue.”

“Between 02:16 and 02:40 UTC 3 March 2020 we became aware of a hardware issue with our cloud service provider causing BitMEX requests to be delayed. Normal service resumed at 03:00 UTC.”

The halt of trading services came on the Seychelles-based derivatives exchange after the exchange saw one of the largest bloodbaths ever resulting in a sudden drop in its funding as well.

The price drop triggered $4 million worth of buy liquidations and $698 million worth of sell liquidations. Both the long and short positions were liquidated however, 90% were of long positions indicating the leverage was on the bullish side.

The aggregate volume for bitcoin futures broke records while BitMEX insurance fund lost 1627 BTC that could be further extended given Friday’s carnage. The funding rate, that is designed to encourage the future price to stay close to the spot price, dropped to -0.3750.

An Insane/Conspiracy Theory

BitMEX now reports the database to be recovered, however, it continues to receive criticism for being the one behind bitcoin’s massive drop. Sam Bankman-Fried, CEO of research firm Alameda and competitor derivatives exchange FTX, took to Twitter to share a theory that accuses BitMEX of doing it on purpose.

Bankman-Fried argues that the minute BitMEX went down crypto recovered as noted by trader Joe Moe as well, “Literally -to the minute- of BitMEXdotcom going down, BTC immediately began its recovery. What a coincidence.”

The second evidence to this insane theory he says is that their liquidation engine was lethargic because BitMEX liquidates the orderbook down to 0 but it didn’t.

And Bitcoin didn’t go to zero because BitMEX stopped grinding down their liquidations slowly in the hopes that it would just go away.

“That’s NOT how a liquidation engine works. A liquidation engine’s primary job is to save the insurance fund and other customers, even if that has significant market impact,” said FTX CEO.

When the things were “teetering on the edge,” BitMEX went down for maintenance and Bitcoin rallied “without the gigantic sell wall of the BitMEX liq.” Bankman Fried said, “Deribit was playing a similar role, and went down at the same time.”

BitMEX refuted any such activity with a harsh statement, “Insane” is right. Sam, you know better than to deal in this type of conspiracy theory, especially since you operate a platform in space and under,” to which SBF said he believes BitMEX and replied with “Sorry for suggesting it!”

Read Original/a>
Author: AnTy

Maastricht University Paid TA505 Hacker Group 30 BTC ($220k) To Unlock Ransomware

Maastricht University, located in the Netherlands has reported they became the victim of a ransomware attack that unfolded on December 24 and paid a BTC ransom.

All the IT systems at the University have been pulled down and offline by officials for the damages and in efforts to be contained. The malware cyberattack was the file-encryption type and acknowledged on the University’s website. Educations institute authorities said scientific data wasn’t in any way affected but restoring it may take a few days.

Hackers Received 30 BTC in Ransom

On Wednesday, the University disclosed that it had made a payment of 30 Bitcoin (BTC) to the hackers for the ransom. 30 BTC at the time of the payment was the equivalent of 200,000 Euros or $220,000. The computer systems and emails got unblocked and as said before, the data is safe.

Premiums for Cyber Attack Insurances Higher and Higher

Since ransomware attacks are more common, insurers have raised the cyber security premiums by 25%, especially ever since hospitals, airports and companies have been majorly hacked back in 2019. The University of Maastricht’s Vice President Nick Bos said he considered all the alternatives to paying the ransom, but he didn’t want to rebuild the entire IT network from scratch, as this would have been costlier and precious data would have been lost.

The TA505 Group Behind the Attack

At the press conference held to disclose the information that the University had about the hack, Bos said the initial breach was a result of a click on a phishing email that a member of the staff who hasn’t been identified done a month before. This is what he mentioned about what damage the attack could have had:

“The damage of that to the work of the students, scientists, staff, as well as the continuity of the institution, can scarcely be conceived.”

Fox-IT, which is a cybersecurity team, helped with the analyze of what happened and the recovery of the data. It has identified the hackers as being part of the TA505 Russian-speaking cyber criminal group.

Read Original/a>
Author: Oana Ularu

NYSE, Bakkt, & eBay Under One Roof? ICE Makes a Takeover Offer to eBay

The Wall Street Journal has just reported that a company that owns the NY Stock Exchange, just made an offer of $30 billion dollars for eBay, the company is the well known Intercontinental Exchange and located in Atlanta.

Intercontinental “may see an opening to apply its technological expertise connecting buyers and sellers to eBay’s core e-commerce site covering everything from electronics to collectibles,” reported WSJ.

ICE is owned by Jeffery Sprecher, husband of former Bakkt CEO Kelly Loeffler who had to quit her position after being appointed the new US Senator from Georgia.

This isn’t the first time ICE has approached eBay, Intercontinental has tried before to offer eBay a takeover bid, and there have been no meetings scheduled to discuss the bid between the two companies. eBay shares, however, jumped 10% on the news while ICE’s were down 3%.

Intercontinental (ICE) is also the company behind crypto exchange Bakkt that enables institutions to buy, sell, store, and spend the world’s largest digital asset by market cap Bitcoin.

eBay also sells virtual currency and mining contracts for Bitcoin. Users can buy items on the platform by using cryptocurrency as well but through third-party platforms.

Earlier last year, there were also rumors that the online auction site might start accepting Bitcoin and altcoins soon after photographs of marketing material from the Consensus conference in New York were revealed that said “Virtual Currency. It’s happening on eBay,”

However, eBay has been once again partnering with the payments platform that accepts cryptos on behalf of merchants and pays them in fiat.

Back in 2017 during the peak of Bitcoin price, senior vice president eBay Americas, Scott Cutler said in an interview that the company was “seriously considering” accepting the digital currency only to add that, “we’re not quite there yet.”

Now, this latest talk of ICE taking over eBay has the crypto community excited and hopeful yet again.

“WHOA. The owner of the New York Stock Exchange is thinking about taking over eBay at a valuation of more than $30 billion. This is the same company that realized the importance of Bitcoin enough to start Bakkt,” wrote Anthony Pompliano co-founder of Morgan Creek Capital. “Would be incredible to combine NYSE, Bakkt, & eBay under one roof.”

Read Original/a>
Author: AnTy

US Treasury Department Pilots Blockchain-Based Federal Grants Tracking System

The US Treasury Department, which is in charge of government revenue, has been reported to experiment with blockchain tech in order to develop a system that tracks federal grants.

The proof-of-concept (PoC) program that’s intended for a blockchain-based grant recipients’ letter of credit is about to be completed, says Craig Fischer, the manager of the innovation program at the Treasury. As reported by Federal Computer Week (FCW), Fischer talked about the program on Friday, at a conference on federal financial systems modernization.

What’s Does the Program Do?

During trials, the program was used to tokenize credit letters so that it follows the trail of grant money from federal reserves to their recipients, says the FCW report. Through tokenization, the grant incipient and amount are being identified, also other important data like the date when the grant was awarded, Fischer mentioned. He continued by adding that grant recipients need to hold an electronic wallet linked to a bank account if they want to be given a tokenized letter of credit. When it comes to access, Fischer mentioned:

“This isn’t the Bitcoin network, where everything is visible.”

The US Treasury started on the Program in September 2019

Developed in collaboration with the National Science Foundation, the San Diego State University and the Duke University ever since September 2019, the trial program is expected to come to an end as soon as this month will be over. It isn’t the 1st time when the Treasury Department is experimenting with blockchain tech in order to enhance its agency.

For example, back in 2018, it has developed a blockchain-based prototype project for managing physical assets like mobile phones and computers, and noted the technology has,

“great potential for streamlining burdensome reconciliation operations that are involved in many financial transactions.”

Read Original/a>
Author: Oana Ularu

After Being Banned on Telegram, ISIS Adopts Blockchain-Based Messaging for Propaganda

It has been reported by Vice that the organization has already started testing a blockchain-based messaging app in order to spread propaganda and communicate anonymously. This app is known as BCM Messenger and comes after the group has already tried using Riot, TamTam, Hoop, and RocketChat. BCM is more advantageous for the terrorists because it’s encrypted and those using can remain anonymous.

BCM Messenger Available on Both iOS and Android

Working on iOS and Android too, the BCM Messenger is advertised as very secure, as its messages are strictly encrypted, and a third party could never decipher their content. Besides, it has the option to create supergroups with more than 100,000 people. Different from other similar platforms for instant messaging, BCM doesn’t require a phone number or an email address. This means anyone can use it without providing personal details, which furthermore indicates law enforcement agents can’t track criminals sending messages on it. This is what Brenna Smith, a disinformation researcher, had to say about BCM in her latest newsletter:

“The app’s core features of anonymity, encryption, and large group-chat sizes also pose a great risk for adoption. Extremists covet technologies that can get their message out to thousands all while concealing their identity.”

Telegram No Longer Accepts Terrorists

Terrorist organizations have been using encryption-enabled instant messaging (IM) platforms to distribute their propaganda for quite a while. Telegram has been their choice in the recent past, since Decrypt reported in August that this platform has been used widely by terrorists from all over the world, as the DC-based Middle Eastern Media Research Institute (MEMRI) says. This is what the MEMRI’s executive director, Steven Stalinsky had to say about the situation back then:

“Telegram is the number one source for terrorist organizations online.”

The EU Made an Effort to Discover and Destroy ISIS IM Accounts

The European Union (EU) made an effort to discover and destroy the ISIS IM accounts, which means the same can happen with BCM. This is what Pavel Durov, Telegram’s CEO has declared in the past about ISIS using Telegram:

“ISIS and their likes will have [a] hard time on Telegram if they continue to spread their message of violence and hatred.”

ISIS isn’t using the blockchain technology for the first time. As a matter of fact, it has been raising funds through cryptocurrency transfers, regardless of the fact that the group is employing public ledgers and are quite easy to track.

Read Original/a>
Author: Oana Ularu