SEC Delays VanEck Bitcoin ETF Decision Again, Another 45 Day Wait Period

The US Securities and Exchange Commission (SEC) seems to be struggling to make its mind up about Bitcoin exchange-traded funds (ETF). The agency has once again extended the review period for the VanEck Bitcoin ETF application by 45 days.

This is the second time the SEC is delaying its decision on the VanEck Bitcoin exchange-traded fund (ETF) application. The regulator first extended its decision in April 2021.

SEC To Accept Comments On The VanEck Bitcoin ETF Application

According to the order filed on Wednesday, the SEC said it would now accept public input on the proposed rule change surrounding the VanEck Bitcoin ETF. This would help guide its decision on whether to approve the fund or not.

The regulator asked the public for comments on the vulnerability of the ETF to market manipulation and if Bitcoin is suitable as an underlying asset for an ETF.

The commission also wants to know commenters’ views on whether the regulatory landscape relating to Bitcoin and other digital assets has changed since 2016.

The regulatory answer to that question could have deep implications for Bitcoin and other cryptocurrencies like Ethereum, which is also yet to get approval to be used in exchange-traded funds.

Interested people who wish to comment on the proposed Bitcoin ETF have until 21 days after the order is published in the Federal Register and 35 days after publication in the same register for rebuttals.

VanEck had filed for the Bitcoin ETF in December 2020. In March, the Chicago Board Options exchange (Cboe) pleaded for VanEck when it filed a request to list and trade shares of the VanEck Bitcoin fund, thereby putting the SEC on the 45-day clock.

The SEC’s 45-days window, which started in April 2021, was expected to end on June 17, 2021. The latest extension means we don’t know the fate of the VanEck Bitcoin ETF until August 3, 2021.

The SEC typically renders a decision on future applications within 45-day windows but can also take up to 240 days to decide.

The US Continuous Delay In Approving A Bitcoin ETF

Despite the change in leadership at the SEC, the agency has so far shown no sign of approving any Bitcoin ETF anytime soon.

The agency has often cited fraud and market manipulation as obstacles to its approval, but applicants have made arguments as to why those issues are blown out of proportion.

Apart from VanEck, there have been at least seven other applications of firms seeking to launch competing funds but none has been approved.

Given the SEC’s continued delay in approving the ETFs of firms like VanEck, WisdomTree, Kryptoin, and Fidelity Investments, many do not expect approval soon.

However, Canada remains one of the most progressive countries in terms of ETFs. Over the past few months, the North American nation has approved both Bitcoin and Ether ETFs.

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Author: Jimmy Aki

Blockchain Company Komodo Launches DEX for Dogecoin (DOGE) Swaps

Parody cryptocurrency Dogecoin seems to be gaining wide adoption as the crypto market surges.

Atomic Swaps Available On DogeDEX

In an announcement made on Wednesday, blockchain as a service (BaaS) solutions provider Komodo said its Doge decentralized exchange (DogeDEX) platform launched March 1 and has been received enthusiastically by Doge enthusiasts.

According to the company, the decentralized platform will enable peer-to-peer exchanges, or “atomic swaps” of the meme-based cryptocurrency. The service will be powered by its AtomicDEX engine for both desktop and mobile apps.

Atomic swaps enable the transfer of crypto-assets using smart contracts. Komodo also said its development team is incorporating fiat-on-ramps in the coming months, which will enable crypto purchases on the decentralized platform.

The Shiba Inu, the mascot representative of the Dogecoin, has become something of a fan favorite. Carving its niche and surviving on celebrity endorsements, Dogecoin has made a tear and gained a phenomenal 2,440% in the last 12 months or so.

One of the crypto-assets avid admirers is Tesla Inc.’s owner Elon Musk. His continued promotion has seen the once disregarded digital asset come into the limelight, and many popular figures have joined the DOGE train.

One of such is Gene Simmons of American rock band KISS fame. He has been joined by popular rap icon Snoop Dogg who has used his reputation to get a good thing going for the digital assets.

Dallas Mavericks billionaire owner Mark Cuban is the latest addition in a long list of admirers who have vocally supported the wide adoption of Doge.

His pro-basketball team, the Mavericks, now accepts Dogecoin from fans. The solution was incorporated by cryptocurrency company Bitpay making Dogecoin the second crypto accepted by the Mavs.

Speaking on the decision, Cuban noted that his basketball team had made 20,000 Dogecoins sales, and he sees the digital asset hitting a price point of $1 soon.

Breaking Through The Hype

Despite all the relative fanfare surrounding DOGE, crypto experts believe that the virtual currency lacks enough use cases to make any significant surge into the top ten brackets. According to them, DOGE’s narrative of being a joke currency needs to erode if it wants to stand a chance in a fiercely competitive crypto market.

Kadan Stadelmann, chief technology officer at Komodo, an open-source cryptocurrency platform and blockchain solutions provider, said that DOGE reaching $1 is nigh on impossible unless it hits Bitcoin-level-buy-ins in the nearest future.

According to Stadelmann, the relative ease of minting Doge tokens is a concern. Stadelmann drew attention to the fact that 10,000 tokens per minute, 14.4 million per day, and 5.2 billion per year of Dogecoins were many.

The massive roll-out of the coin could lead to inflation in the long-term, making a mockery of what cryptocurrencies like Bitcoin came to solve through its metered supply cap.

Johnny Lyu, CEO of cryptocurrency platform KuCoin, feels otherwise. According to Lyu, the growing attention DOGE is gaining from celebrity endorsements may likely see it being used for everyday transactions.

Lyu feels the relative ease and speed of sending value with the parody crypto-asset could stand it in good stead. He, however, noted that DOGE breaking into the top five anytime soon was out of the question.

The digital asset’s phenomenal rise may be appealing to Musk and Simmons, but Joel Edgerton feels very differently. According to the chief operating officer of crypto exchange bitFlyer, digital coins like DOGE are just fun to hold as they cannot solve real-life problems.

At press time, DOGE traded $0.056, up 1.7%.

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Author: Jimmy Aki

Bancor’s Approach to Handling Impermanent Loss Shows Financial Viability

Bancor has been working on a reliable method to address impermanent loss and it seems to have struck gold with its insurance-based approach

The Bancor Network has been busy trying to solve the issue of impermanent loss on its decentralized exchange. In a recent report, the protocol showed significant success with its approach, leading to the belief that it might be able to handle the protection of temporary loss of funds in the long term.

Impermanent Loss on DEXs

Yesterday, Bancor released a Protocol Health Report for its v2.1 decentralized exchange (DEX) upgrade.

The report covered the exchange’s financial and operational performance for the past quarter, showing significant liquidity and revenue gains.

As the report showed, liquidity across the DEX rose by 100 percent over the past three months, resulting in about 700,000 BNT (worth $1.12 million) in earnings from swap fees. However, the platform’s strategy on impermanent loss appeared to have faltered.

When Bancor launched the DEX late last year, it focused primarily on effective impermanent loss management.

Also known as divergence loss, the impermanent loss is a problem that affects mostly exchanges that run on the automated market maker (AMM) protocol. It occurs when liquidity providers (LPs) lose funds due to the volatility of a trading pair. It basically describes how much revenue an investor would have earned if they had held on rather than provide liquidity to the market.

The effect of this divergence is a loss of value, compared to the benchmark “buy and hold” portfolio.

The loss is termed “impermanent” because it could be reverted if the prices returned to their original state. However, even in the best scenarios, losses due to divergence will reduce liquidity providers’ profits from price swings.

Possible Long-Term Benefits

Bancor had initially tried to solve the problem with oracles, which reads token prices and render arbitrage virtually unnecessary.

However, front-running issues rendered this approach impractical. So, the exchange deployed an insurance mechanism to cover the cost of impermanent loss.

The project implemented a vesting schedule to incentivize LPs to stake their tokens in the long term.

The protocol’s strategy was to incentivize more altcoin holders to become LPs instead of adopting the buy-and-hold strategy. Another strategy Bancor plans to explore is to encourage projects to use their treasuries to provide liquidity to AMMs. Just like proof-of-stake (PoS) rewards, the method could allow projects with considerable token reserves to increase liquidity on token pairs and also get additional rewards.

The vesting schedule will see Bancor provide one percent coverage on liquidity capital for up to 100 days. However, LPs who make withdrawals before 30 days won’t get any compensation for losses in that period.

Bancor’s approach appears to be yielding benefits. As the company reported, the total impermanent loss associated with withdrawn liquidity amounted to 41,000 BNT ($64,000). On the flip side, the protocol also earned 350,00 BNT ($560,000) in fees.

Bancor added that some LPs withdrew their deposits before getting 100 percent insurance. These LPs got partial protection, which was paid based on their coverage level. The report pointed out,

“As the proportion of insurance policies with 100% protection increases over time, it stands to reason that the associated cost to the protocol will rise. However, various factors suggest the protocol is able to handle this insurance burden.”

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Author: Jimmy Aki

Venezuela’s Bolivarian Army Embarks on Bitcoin Mining for Income and Sanction Evasion

Venezuela is further expanding its crypto foothold in what seems to be a tact towards salvaging the country’s economy while evading imposed sanctions, especially by the United States. Through one of its engineering brigades, the Venezuelan army recently revealed a Bitcoin mining center dubbed ‘Digital Assets Production Center of the Bolivarian Army of Venezuela.’

Inaugurated via an Instagram post, the center is fitted with ASIC machines to mine crypto assets by cracking the proof-of-work (PoW) algorithm. This implies that Bitcoin is probably the main asset which the Venezuelan army plans to mine within its newly launched facility.

The move comes as Venezuelans continue to struggle to make ends meet after the country’s economy tumbled on oil prices coupled with political uncertainty under Maduro’s administration. Today, the Venezuelan Bolivar is almost useless, trading at 1 million VES against the U.S dollar.

Given the circumstances, it is not surprising that Venezuela is among the jurisdictions that have experimented with crypto assets the most. The state had approved its oil-backed crypto-asset dubbed ‘petrodollar’; however, it did not solve the shortcomings as expected.

The Venezuelan army now says that a mining center might be part of the solution to its ailing economy and sanctions. Presenting the new operation, General Lenin Herrera noted that the goal is to strengthen and achieve self-sustainability within the Bolivarian army units.

He went on to highlight that this milestone will also generate ‘unblockable sources of income.’ Therefore, he could act as an alternative in evading colonial interests from countries like the U.S. Notably, Venezuela recently legalized Bitcoin mining but with a central oversight through a national digital mining pool.

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Author: Edwin Munyui

Macro Investor Raoul Pal Goes ‘Irresponsibly Long’ on BTC, But More Bullish on ETH

You got faith in it; bet everything on it. This seems to be the philosophy of Raoul Pal, a former Goldman Sachs hedge-fund manager who announced over the weekend that he is going all-in in Bitcoin.

However, he did clarify that he can afford to take this road and cautioned others to do the same as him and “do your own research and size accordingly.”

By betting his 98% liquid net worth, Pal has beaten another vocal Bitcoin bull Anthony Pompliano who says his 90% investment is in BTC. But as Pal points out, he is

“older and in a position to take more risk. And it is risk, no guarantees.”

The prominent bitcoin bull is putting it where his mouth is as he prepares to sell all of his gold and invest it all in Bitcoin and Ethereum. Pal, the co-founder of Real Vision tweeted,

“I have a sell order in tomorrow to sell all my gold and to scale in to buy BTC and ETH (80/20). I don’t own anything else (except some bond calls and some $’s). 98% of my liquid net worth. See, you can’t categorize me except #irresponsiblylong.”

While only 20% of the latest investment is in Ethereum, Pal has a “hunch” that it would be Eth that would beat Bitcoin in price performance. Explaining the reason behind his 80/20 allocation, he said,

“I think ETH outperforms possibly by 5 to 1 but who knows. BTC is the easy bet.”

It would be no surprise if Eth actually outperforms Bitcoin because it did so in the last cycle too.

Compared to Bitcoin’s 1,300% gains in 2017, ETH rallied 9,162% the same year. Moreover, while BTC is just over 7% away from its all-time high of $20,000, ETH has yet to surge 63% to reach its all-time high of $1,570.

In terms of year-to-date performance as well, ETH has gained 341% to Bitcoin’s 156% while trading at $575 and $18,470, respectively.

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Author: AnTy

Pakistan Regulators Look to Build Friendly Framework for Digital Assets

Pakistan seems to realize the potential of digital assets in the financial future as the country seems geared up for formulating a new framework to regulate cryptocurrencies such as bitcoin. This is highly bullish since Pakistan was among the very few countries that in mid-2018 blanket banned digital assets in any form. It wasn’t until April of 2019 that regulators started to change their minds.

The Securities and Exchange Commission of Pakistan (SECP), on November 6th, released a consultation paper about regulating digital assets. The paper mentioned that the finance ministry is looking to make new laws as they look at the regulatory frameworks set by other countries.

SECP believe digital assets is a “start of a new era of digital finance.” The consultation paper further noted that to propel this new digital finance era, a new set of frameworks would be required to drive its adoption.

“Digital assets also known as Virtual Assets, and Crypto Assets are the start of a new era of Digital Finance, and demand innovative regulatory measures and approaches by the regulators across the world.

This could only be possible by initiation of a new era that re-invents regulatory regime/measures as they are known to the regulators globally today.”

It is also important to note that many developed countries in the West are currently discussing launching a Central Bank-issued Digital Currency (CBDC); however, the consultation paper makes no mention of any such plans by Pakistani financial watchdog. At present, they are only focusing on regulating private digital assets such as bitcoin.

The paper made a note of two types of tokens, namely security tokens and utility tokens, where the regulatory body sees a security token as an important tool that might help in fractionalizing real-world assets and digitize them.

The paper mentions that they have 2 choices as regulators; restrict digital assets due to current rules or take a ‘let-things-happen’ approach. Which they mention that they are heavily leaning towards the do-no-harm approach.

The paper also welcomed feedback from the stakeholders of the decentralized space in developing the new framework.

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Author: James W

SEC Proposes $5 Million Settlement in Kik’s $100 Million ICO for KIN

Kik Interactive, the embattled Canadian messaging startup, seems to have finally reached a settlement deal with the SEC regarding its illegal ICO back in 2017. Since the summer of 2019, the two parties in court have gone back and forth, with the latest ruling by a New York judge, favoring the SEC.

With barely three weeks since the ruling, the SEC has now proposed that Kik should settle with a fine of $5 million with the market watchdog. Kik’s ICO had raised a total of $100 million, intended for a crypto network dubbed ‘KIN.’ This was, however, cut short by the SEC, which sought to pursue Kik on account of issuing an illegal security.

According to the SEC’s court document, the two parties have agreed on a proposed judgment and are now seeking the court’s approval. Other than the $5 million in penalties, Kik will be required to give a 45-day notice if they want to launch another Kin token sale. The document states,

“The proposed Final Judgment, if approved by the Court, would permanently enjoin Kik from committing future violations of Section 5, according to Section 20(b) of the Securities Act of 1933, 15 U.S.C. § 77t(b); impose a conduct-based injunction, as outlined in the proposed Final Judgment, under Section 21(d)(5) of the Securities Exchange Act of 1934, 15 U.S.C. § 78u(d)(5); and require Kik to pay a penalty of $5 million, under Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d). The proposed Final Judgment would conclude this action.”

Unlike Telegram, which had a similar encounter with the SEC, Kik has not been obliged to return its investors’ funds. This means that the project’s tokenization dreams could be realized despite the SEC’s 16-month long legal battle. Notably, Kik has previously argued that its Kin token was sold based on its underlying utility instead of a speculative nature suggested by the SEC.

If the court approved the proposed judgment, Kik would only settle for $5 million; this amount is equivalent to what they collected during their fundraising initiative dubbed ‘Defend Crypto’ Campaign. Other ‘illegal’ ICOs like EOS and Telegram have had it a bit rougher, with each settling at $24 million and $18 million, respectively.

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Author: Edwin Munyui

Gene Simmons of KISS is into Bitcoin & Crypto

Rock star Gene Simmons seems to be endorsing bitcoin.

The frontman of the legendary band KISS, Simmons responded to crypto exchange Gemini co-founder Cameron Winklevoss’ tweet where he talks about buying crypto. Winklevoss said,

“It’s easier to buy Bitcoin and Ether if you are already in the old system. If you don’t have a bank account, it’s hard to get funds into crypto. We need to change this.”

“I will. I am,” responded Simmons.

The musician who also has other titles; singer, songwriter, record producer, entrepreneur, author, and actor to his name didn’t elaborate on it despite several attempts by the crypto community.

Per Simmons’s previous comment about bitcoin, he is surely into digital assets.

“I am interested in Bitcoin, but only as a piece of the [investment] puzzle,” he said in an interview in late 2017 with The Street.

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Author: AnTy

Apple is Censoring DeFi & ‘Stifling Innovation’ in Crypto Industry: Coinbase CEO

Apple having a row with developers and app providers is nothing new, but the tech giant seems to be especially targeting the cryptocurrency industry.

Last month, Epic games and Apple got into a legal battle when the Fortnite creator launched its own in-app payment system, which also involved the use of bitcoin and cryptos, to circumvent Apple’s “monopoly over in-app payments on iOS.”

As a fact of fact, Apple doesn’t allow to add the ability to earn money using crypto and access Defi apps or Dapps in their iOS apps, said Brian Armstrong, CEO of crypto exchange Coinbase, which has regularly come under fire for taking up the authorities’ side against their customers.

“Why would Apple want to prevent people from earning money during a recession? They seem to not be ok with it, if it uses cryptocurrency,” he said.

According to market participants, tech giants want to be everyone’s bank, and as Podfather Adam Curry told Joe Rogan, it is how they control people.

Stop This!

In a Twitter thread, Armstrong shared the struggles Coinbase is also going through with Apple, which end up creating a “worse” experience for customers.

Besides the company’s Coinbase Earn program, Apple doesn’t let them provide a list of decentralized apps, “which are really just websites” to iOS users.

In the past couple of months, the DeFi sector has exploded, reaching almost $10 billion, amidst the central banks’ quantitative easing and interest rate cuts, which have been devaluing the fiat currencies around the world.

“DeFi and Dapps are a major area of innovation in financial services that has seen rapid growth lately,” and has “enormous potential.”

But Apple doesn’t let companies help the “unbanked and underbanked” on the grounds that the “app offers cryptocurrency transactions in non-embedded software within the app, which is not appropriate for the App Store.”

According to Armstrong, Apple is “holding back progress in the world” by censoring the features and further protecting competition.

He likened Apple’s actions with Microsoft forcing users to use Internet Explorer on Windows, which “led to all their antitrust issues.”

“Apple, it’s time to stop stifling innovation in cryptocurrency. We would like to work with you productively on this. Some day, cryptocurrency could even be integrated into IAP to give people in emerging markets better access to the financial system globally,” said the Coinbase CEO.

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Author: AnTy