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Global cryptocurrency exchange Binance has officially opened two offices in Brazil, seeking to extend its reach in the South American country where a spate of companies has added digital asset trading services in recent months. 

Binance opened two offices Monday in Brazil’s finance hub of São Paulo, as well its second-largest city of Rio de Janeiro. The exchange’s CEO Changpeng Zhao (CZ) announced the plan to open the offices in March, according to a Binance statement. The exchange now has a Brazil-based team comprised of more than 150 people.

Brazil’s currency, the real, and broader markets spiked on Monday following news of a presidential runoff vote, following a close race on Sunday between incumbent president Jair Bolsonaro and leftist former president Luiz Inácio Lula da Silva.

Binance, the world’s biggest cryptocurrency exchange by trading volume, has been strategically eyeing Brazil for months. Company executives reportedly have met with government officials, and the exchange signed a memorandum of understanding (MOU) in March to acquire locally-regulated securities brokerage Sim;paul Investimentos. The status of that transaction is unclear.

Separately, the company recently added former Brazilian finance minister Henrique Meirelles to its global advisory board. 

Brazil is still awaiting broad cryptocurrency regulation as a long-awaited bill sits in the country’s lower chamber. However, a wave of high-profile payment apps and digital banks have added digital asset trading services within the past year, including Nubank, Mercado Libre and BTG Pactual. The country ranked seventh on Chainalysis’ latest Global Crypto Adoption Index. 

Acquiring a locally-regulated entity like Sim;paul would be a strategic move for Binance to grow its offerings Brazil. The company has faced some regulatory scrutiny there, having to suspend futures trading on its Brazilian site in August 2021 after the country’s Securities and Exchange Commission (CVM) said in July 2020 that it was not registered to operate in the Brazilian securities market.

Binance underscored that it “operates in full compliance with the Brazilian regulatory landscape” and supports regulation. 

Binance has been opening offices around the world in local markets, also announcing Monday that it will expand its Kazakhstan location as it works to build a regional hub. Binance also revealed a new office in New Zealand on Sept. 29, and has also registered with regulators in countries including France, Italy and Spain.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Decentralized finance platform Exponential has raised $14 million in a seed round led by Paradigm. 

Other backers include FTX Ventures, Haun Ventures and Circle Ventures, as well as over 80 angel investors including Balaji Srinivasan, Anthony Pompliano and Elad Gil, according to a company blog post. 

The startup is founded by ex-Amazon and Uber veterans who want to simplify DeFi investing; making it easier to discover, assess and invest in yield opportunities. 

Exponential CEO and co-founder Driss Benamour previously worked as head of fintech products at Uber, while co-founder and chief technology officer Greg Jizmagian worked at Amazon for over five years and helped to build out Amazon’s voice grocery shopping efforts. 

Decentralized finance enables two parties to undertake financial transactions directly without an intermediary. The challenge with DeFi is that this often means interacting with obscure protocols and complex setup processes.

Exponential wants to bridge the gap between web2 and web3 making it easier to invest in DeFi protocols through its platform.  “Exponential users will have DeFi instruments at their fingertips,” the company said in the blog post. 

State of the market 

However, decentralized finance is a whole different beast compared to the consumer apps offered by Amazon and Uber.  

Risk appetite has changed for decentralized finance products in recent months as individual investors grapple with macroeconomic headwinds from rising interest rates to surging inflation. There’s also been an uptick in the number of high-profile hacks where investors have lost significant sums of money.

Equally, venture investors have also been less active in the market. Only 15 deals took place in August, which is the lowest frequency of deals for the DeFi category since January 2021, according to data from The Block Research. 

Exponential is built to navigate this change in risk appetite with a service called “rate my wallet.” This helps analyze the risk profile of an individual’s current investments and suggest better alternatives. 

The platform has assessed over 100 protocols across 20 blockchains so far, according to the company website. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Bitcoin mining revenue fell 16.2% in September to about $550.5 million, marking its fifth decline in the last six months and the lowest total since November 2020, according to data compiled by The Block Research.

Bitcoin generated about 1.56 times the revenues of Ethereum miners and stakers combined following the latter network’s switch to proof-of-stake.

Most bitcoin mining revenues came from the block reward subsidy ($541.8 million) and only a small portion from transaction fees ($8.66 million). The share of bitcoin transaction fees over total revenue increased slightly to around 1.6%.

The network hashrate grew roughly 10.4% over the month of August and 0.6% during September.

In the most recent update, the network difficulty fell by 2.14%.

“Decreasing mining economics are leading to high-cost and low-efficiency miners shutting off,” Ethan Vera, COO of bitcoin infrastructure company Luxor Technologies, told The Block. Parallel to this, as some miners liquidate hardware amid the bear market, those machines are coming offline and being sent to new locations.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

A bitcoin fund launched by digital investment services firm NYDIG has raised $719.9 million to date. 

NYDIG Institutional Bitcoin Fund LP has raised the funds from a total of 59 investors, according to a filing with the Securities and Exchange Commission. The filing was made on Friday and shows an increase of just over $28 million in investments since the last raise in 2021, when investments reached $691 million.

The fund has one less investor since the 2021 raise, where the filing registered 60 investors. 

The fund was first registered with the SEC in 2018, raising $31 million from three investors before raising an additional $54 million from six investors in 2019. NYDIG was valued at over $7 billion last December, with the firm saying at the time that it would use the funds to expand its institutional-grade bitcoin platform including support for Lightning network payments, smart contracts, and asset tokenization.

NYDIG is a subsidiary of Stone which is Stone Ridge Holdings Group, a multi-billion dollar asset management business that also owns Stone Ridge Asset Management LLC.

Last month, Stone Ridge Asset Management LLC filed a liquidation and dissolution plan for its bitcoin strategy fund with the SEC.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Digital Currency Group’s Grayscale is terminating its relationship with sister firm Genesis to issue new shares of its crypto products, including the flagship fund GBTC. 

According to a new regulatory filing with the Securities and Exchange Commission, Genesis will no longer be responsible for issuing new shares of its crypto fund products as Grayscale will bring the function in-housem serving as an authorized participant for the products via a new entity, Grayscale Securities. 

CoinDesk, which DCG also owns, first reported the news. 

Grayscale Securities, a registered broker-dealer with the SEC and FINRA member, will serve as the only authorized participant. Genesis will continue to serve as a liquidity provider, sourcing cryptocurrency holdings for the trusts. 

The transition — which is effective October 3 — comes amid a flurry of exits from Genesis in the wake of the meltdown of crypto hedge fund Three Arrows Capital, against which Genesis filed a $1.3 billion claim.

Several Genesis executives have left the firm in recent months, including former CEO Michael Moro, sales and trading executive Matt Ballensweig, and head of derivatives Joshua Lim. 

The broker said in August that it cut 20% of its workforce. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• This DeFi governance roundup piece covers Aave, ApeCoin, Balancer, BitDAO, Frax Finance, Lido, Stargate Finance, SushiSwap and Uniswap.
• The main themes across the governance proposals covered revolve around improving protocol features and community building initiatives.
• With market conditions staying unfavorable, protocol teams have directed their full focus to building their products better and strengthening community foundations.

This research piece is available exclusively to
members of The Block Research.
You can continue reading
this Research content on The Block Research.

Separately managed account provider Eaglebrook Advisors and disruptive innovation investment firm Ark Invest have partnered to make investing in crypto strategies more accessible, according to a release from Eaglebrook. 

The partnership will enable two crypto strategies — actively managed by Cathie Wood’s Ark Invest — to be made available as separately managed accounts to clients of registered investment advisors. 

“We are thrilled to deliver Cathie and the ARK team’s digital asset portfolios in an efficient manner [SMAs] to everyday investors through our platform which is designed specifically for the wealth management channel,” said Roddy Chisholm, chief operating officer of Eaglebrook Advisors, in the release. “This is a game changer for the industry and yet another sign of mainstream adoption.” 

Ark Invest’s crypto strategies

Ark Invest provides investors exposure to disruptive innovation through a range of exchange-traded funds. The firm is helmed by portfolio manager Cathie Wood. Its flagship fund, the ARK Innovation ETF, currently has $7.9 billion in assets under management — and is down 55.72%, year-to-date. At its peak during the most recent bull market, the fund had around $28 billion in assets.

Clients of registered investment advisors leveraging Eaglebrook will be able to access two crypto strategies from Ark. The first is the “cryptoasset strategy” that is actively managed and will invest in the top 10 to 20 coins that represent financial and internet revolutions. The second approach is the “cryptocurrency strategy,” which is an actively managed high-conviction portfolio that mainly invests in BTC and ETH. 

“The strategies will be separately managed accounts (SMAs) designed to meet the needs of financial advisors, wealth managers, and their clients by offering direct ownership, low minimums, and portfolio reporting integration amongst other benefits,” said Wood in the release. “Advisors can differentiate themselves and add to a client’s diversification by adding this new asset class to their portfolios.” 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Bitcoin investment firm NYDIG announced the promotion of company executives Tejas Shah and Nate Conrad to the roles of CEO and president, respectively. 

The promotions mean that both NYDIG’s current CEO Robert Gutmann and President Yan Zhao will be stepping down.

The pair will, however, remain at Stone Ridge Holdings Group, NYDIG’s parent company, working across the portfolio of Stone Ridge business, according to a company release. Gutmann will also continue to serve on the NYDIG board. 

“I’m proud of everything we’ve accomplished so far, and I cannot wait to see what the incredible NYDIG team will achieve in the coming years and decades,” said Gutmann in the release. “As leaders of our biggest businesses, Tejas and Nate have been driving forces in NYDIG’s success. They are ready to lead NYDIG in its next phase of growth.” 

NYDIG offers a full-stack Bitcoin platform to businesses across a range of industries to make Bitcoin and Lightning network more accessible, alongside a number of bitcoin investment services.

Both Shah and Conrad previously worked at Goldman Sachs and were most recently in the positions of NYDIG’s global head of institutional finance and global head of payments, respectively. 

Shah and Conrad will be focused on accelerating NYDIG’s investment in mining solutions and in its platform technology business, which help enterprises use the Lightning Network. 

“Even during the height of the crypto frenzy in H2 2021, our risk management discipline kept us entirely away from DeFi, centralized lending platforms, and the uncollateralized lending market,” said Ross Stevens, founder and executive chairman of NYDIG in the release.  

“The firm’s balance sheet is the strongest it’s ever been, and we’re now investing aggressively into a capital-starved market. Robby and Yan are delivering the business to Tejas and Nate in phenomenal shape,” he added. 

The shake-up at NYDIG comes at a time when a changing-of-the-guard is occurring across many crypto companies. 

In September, Brett Harrison stepped down as president of FTX.US and will be moving into an advisory role at the company. Kraken’s CEO Jesse Powell also stepped away from his role at the crypto exchange but will stay on as chairman of the firm’s board of directors. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

The Sushi DAO community has a new “Head Chef,” following the outcome of a governance vote.

The vote began on September 26 and ended at 08:00 AM EST today with Jared Grey emerging as the winner. Grey was among five candidates for the Sushi chief executive (Head Chef”) position. He polled 11 million out of the 13 million votes cast by governance token holders. This amounted to over 83% of the votes cast in the process.

“This snapshot will culminate the Head Chef search process, and will be used to bind the Sushi protocol’s decision on the next Head Chef,” the Sushi core team said in the announcement.

Jared Grey’s background is in business development and IT consulting. His crypto experience includes a stint as CEO of DeFi yield platform Eons Finance.

Today’s vote could mark the end of the Sushi DAO leadership saga that has gone on for almost as long as the protocol has been in existence. It all began in September 2020, when the pseudonymous “Chef Nomi,” Sushi’s first Head Chef stepped down. This came after accusations that Nomi tried to “rug pull” SushiSwap users by siphoning over $14 million from the project. Chef Nomi later returned the funds as well as control of the SushiSwap project to a team of developers led by FTX CEO Sam Bankman-Fried.

A new leadership team emerged but they soon ran into issues. Chef Maki, Nomi’s successor, stepped down in September 2021. Then, Joseph Delong resigned as chief technology officer in December 2021 amid rumors of mismanagement of finances and infighting among developers of the project.

In 2020, the project team recommended Jonathan Howard as the new Head Chef. However, Sushi DAO members railed against Howard’s proposed compensation package. This package would have seen Howard earn $800,000 per year plus an additional $600,000 worth of vested SUSHI tokens. Howard withdrew his name from contention in August, leading to a new search that culminated in today’s vote.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Kim Kardashian has been charged with unlawfully touting a crypto security by the Securities and Exchange Commission (SEC).

The crypto was offered and sold by EthereumMax, who didn’t disclose the payment Kardashian received for the promotion. Kardashian has agreed to pay $1.26 million in penalties and will work with the SEC on its ongoing investigation.

“This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean those investment products are right for all investors,” SEC Char Gary Gensler said on Twitter.

This is a breaking story and will be updated.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.