Custody tech provider METACO and forex trading platform Cobalt have teamed up in a bid to rewire the financial system to handle cryptocurrency.
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Author: Ian Allison
Publicly-traded MicroStrategy announced Tuesday that it had purchased an additional 295 bitcoin for $10 million in cash.
This brings MicroStrategy’s total bitcoin holdings to 71,079 bitcoin, worth about $2.5 billion at current prices.
The company’s bitcoin bet appears to have paid off well so far. MicroStrategy acquired these bitcoins at an aggregate price of around $1.15 billion, or at an average price of around $16,109 per bitcoin. Currently, bitcoin’s price is trading at around $34,850.
Just less than two weeks ago, MicroStrategy bought bitcoin worth $10 million. Last week, the Nasdaq-listed company said it wants to acquire more bitcoin and that it is exploring alternative avenues for doing so.
MicroStrategy began purchasing bitcoin in August last year. At the time, the company’s CEO Michael Saylor said, bitcoin investments are aimed at maximizing long-term value for shareholders.
Later, in an interview with The Block, Saylor said bitcoin is the “best money ever created.” He compared bitcoin to gold and the U.S. dollar and said the cryptocurrency is a superior asset for a treasury given that it is not deflationary by design.
© 2021 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.
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Author: Yogita Khatri
Analysts cautioned that a stronger dollar could play spoilsport to any new push higher.
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Author: Omkar Godbole
Crypto exchange Gemini has launched a new interest-earning program called Earn, which offers up to 7.4% yield.
The program, initially available for select Gemini customers, will be rolled out to all by early February, the exchange announced Tuesday. The program will be available in all 50 U.S. states, including New York.
Gemini Earn supports all 26 crypto assets the exchange supports on its trading platform, including decentralized finance (DeFi) coins, such as Uniswap and Aave.
The highest yield (7.4%), however, is only available on Filecoin. For the rest of the supported coins, the interest rate ranges from 1.54% to 5.83%.
The most popular cryptocurrencies, bitcoin (BTC) and ether (ETH), each yield 3.05%.
Gemini rival BlockFi, on the other hand, offers up to 6% interest rate on bitcoin deposits and 5.25% for ether deposits. BlockFi’s feature, however, supports limited coins and is not available for users based in New York.
Gemini Earn, on the other hand, appears to be riskier. “Loans made through the Program are unsecured. You have exposure to Borrower credit risk, and Borrowers are not required to post collateral to you or to Gemini,” read the terms of the program.
That means users could lose all of their deposits in case a borrower defaults. “The Borrower is not required to custody or maintain the Loaned Digital Assets with Gemini or any other Gemini-controlled account,” read the terms. “Gemini will not be responsible for any Digital Assets once they leave Gemini’s custody. Loans are not insured by Gemini or any governmental program or institution.”
BlockFi’s offering has both secured and unsecured loans, according to its terms of service.
Gemini COO Noah Perlman told The Block that the exchange has “vetted institutional lending partners, such as Genesis Global Capital,” adding that these partners find borrowers and lend customers’ funds for an interest payment.
“There is a high demand for crypto among institutional borrowers who use it to fund their operations and investment strategies, so they are willing to pay competitive market rates to borrow crypto,” said Perlman.
© 2021 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.
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Author: Yogita Khatri
The product is part of Gemini’s attempt to bring in new crypto investors with bank-like products.
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Author: Nathan DiCamillo
The NYSE-listed lottery firm may also acquire another 10,000 miners this year.
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Author: Tanzeel Akhtar
Quick Take
- Fei Protocol acts as an algorithmic pseudo-central bank that issues the FEI stablecoin
- Crypto-asset collaterals that back the stablecoin are controlled by the protocol and are deployed to Uniswap as liquidity
- The algorithm penalizes selling and incentivizes buying activities on Uniswap when FEI is trading below the $1 peg
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Author: Eden Au
If convicted, the two men face a maximum of 10 years in prison, caning and fines.
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Author: Sebastian Sinclair
Quick Take
- Andersson Horowitz (a16z), the renowned venture capital firm out of Silicon Valley, has been an early investor in digital assets, investing in the sector as far back as 2013
- In April 2020, A16Z raised $515 million for a second crypto-specific fund, totaling $865M under management across the two funds
- In total, the firm’s active portfolio consists of at least 32 startups and protocols across eleven verticals, which The Block has mapped out. This is the second iteration of a16z’ portfolio map and an update to our previous coverage.
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Author: John Dantoni
Cryptocurrency exchange OKEx is adding support for Bitcoin’s Lightning Network in the coming weeks.
Revealing the news exclusively to The Block on Tuesday, OKEx said the move is aimed at enabling cheaper and faster transactions for users.
Specifically, bitcoin deposits and withdrawals will get cheaper, said the exchange.
The current average cost of one bitcoin transaction is about $11, and its average confirmation time is between 10-30 minutes. “This is impractical as more users join the network,” OKEx CEO Jay Hao told The Block.
With Bitcoin’s Lightning Network, a Layer-2 scaling solution, the average cost will come down to “less than 0.01 cents,” and the average confirmation time will reduce to “1-3 seconds,” said Hao.
That would be a huge benefit, but there are certain limitations of the Lightning Network. It is mainly meant for micro-transactions.
In other words, there is a cap on bitcoin withdrawals. “For now, we are setting the limit at 0.000001 BTC to 0.05 BTC [$0.035 to $1,770],” Hao told The Block.
For deposits, OKEx doesn’t control the limit, “but when you withdraw on another Lightning Network node to that deposit, that node will have similar limits,” said Hao.
OKEx has partnered with Lightning Labs for the integration, meaning the exchange will become one of the nodes on the Lightning Network.
The network is made up of nodes to send and receive bitcoin from each other. These nodes open payment channels between them to increase the liquidity of the network. There are currently more than 8,600 nodes with payment channels, according to data from Bitcoin Visuals.
There is no specific date by when OKEx’s integration with the network will be live, but Hao said it should be completed by March.
A number of crypto exchanges have announced support for the Lightning Network in recent weeks, including OKCoin and Kraken. Bitfinex, Bitstamp, and a few other exchanges already support the feature.
© 2021 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.
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Author: Yogita Khatri
