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Wirex, the London-based cryptocurrency card issuer, has been made a Visa principal member in Europe.

According to an announcement shared with The Block on Tuesday, the membership allows Wirex to issue Visa cards itself, offer new products, and apply for additional licenses. Visa principal members, in general, are authorized to act as issuing banks, meaning they can issue cards and provide transaction processing services.

Currently, Wirex’s debit cards are issued by Visa. They are available in Europe and Asia and allow users to buy and convert crypto into fiat for spending it. Wirex claims it has more than 3 million customers.

In the coming months, the company is also entering the U.S.  The launch is “imminent” there, said Wirex. To be sure, Wirex USA received its first money transmission license from the Georgia Department of Banking and Finance in August.

Besides the debit card, Wirex also offers a bitcoin rewards scheme called Cryptoback, giving users up to 1.5% back in bitcoin for every in-store transaction they make.

Today’s Visa principal membership makes Wirex only the second crypto-native firm to get the tag. Earlier this year, Coinbase became the first pure crypto firm approved as Visa principal member. Meanwhile, Wirex also is a principal member of Mastercard.

© 2020 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

• The following is the final excerpt from the ‘2020 Macro Overview’ section of the Block Research’s forthcoming year-end report.
• We examine both digital and traditional asset market performance, the labor market, real gross domestic product, monetary policy, and more economic data throughout the last three quarters of 2020. 

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

Quick Take

• In USD performance terms, Bitcoin, Litecoin, Bitcoin Cash and Dash have returned 760%, 165%, 6% and -40% respectively since August 1, 2017 — the date of the Bitcoin Cash hard fork.
• Moreover, despite Bitcoin recently breaking past its 2017 high, Litecoin, Bitcoin Cash and Dash are all still trading 68%, 91% and 92% respectively below their 2017 USD all-time highs.
• Bitcoin is also leading its forks from a price performance perspective in 2020.

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

Crypto exchange FTX has listed futures contracts of Coinbase ahead of its initial public offering (IPO).

The CBSE pre-IPO contracts allow traders to speculate on at what price Coinbase will list on a stock exchange. In other words, the contracts track the market capitalization of Coinbase.

At the time of writing, the contracts imply the market capitalization of Coinbase at about $58 billion (the current contract price of around $233 multiplied by the maximum market capitalization of the contracts, i.e., $250 million).

The contracts expire at the end of Coinbase’s first trading day at a stock exchange, or on June 1, 2022. If the listing does not occur by the date, the contracts will automatically become fractional tokenized stocks.

The contracts also support margin trading, with up to 5x leverage. Within a few hours of listing today, the contracts have seen a trading volume of about $2.1 million, as of this writing.

That’s a “pretty healthy volume so far,” FTX CEO Sam Bankman-Fried told The Block. He said the Coinbase contracts were one of the most asked products. 

The brokerage services provider for the contracts is FTX partner CM-Equity AG that is based in Germany.

The Coinbase pre-IPO contracts are the second such product by FTX after Airbnb. Bankman-Fried told The Block last week that the exchange could list Coinbase and Robinhood pre-IPO contracts.

The Coinbase contracts have now arrived as the exchange filed a confidential S-1 form with the U.S. Securities and Exchange Commission on Thursday.

It should be noted that, like other products of FTX, its pre-IPO contracts are not available to U.S. residents.

© 2020 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.

Indian cryptocurrency exchange CoinDCX has raised $13.9 million in Series B funding.

The round was led by Block.one, with participation from Temasek, Coinbase Ventures, Jump Capital, Uncorrelated Ventures, Polychain Capital, Mehta Ventures, and Alex Pack. (Pack is a former managing partner of Dragonfly Capital who joined Huobi’s investment unit last month).

With fresh capital at hand, CoinDCX plans to scale its product and technology functions, grow its team, and beef up compliance and security parts of its platform, co-founder and CEO Sumit Gupta told The Block.

On the product side, specifically, CoinDCX plans to upgrade its newly launched investment app CoinDCX Go. “A lot of features” are set to be added to the app “in the next couple of months,” said Gupta. He added that the overall goal is to onboard “millions of new people into crypto.”

To that end, CoinDCX is “actively hiring” people across functions and is looking to double its team from the current 90 people to about 180 in the next one year, said Gupta. As for compliance and security plans, Gupta did not reveal specific details but said, “we want to become India’s most compliant exchange.”

CoinDCX is also looking to scale its transaction monitoring and crypto storage capabilities, said Gupta. The exchange recently partnered with Onfido for strengthening its know-your-customer and anti-money laundering processes, as well as with BitGo to custody customer funds with a $100 million insurance.

Looking to the future, CoinDCX’s specific goal is to onboard 50 million customers into crypto. Volumes appear to be secondary for the exchange. “We don’t want customers to put a very large amount of capital. They should invest based on whatever their comfort zone is — INR 100 [$1.35], INR 1,000 [$15], 0.1% of their portfolio, or 1% of their portfolio. The important thing is to invest first, and then eventually, manage the portfolio.”

CoinDCX currently has about 200,000 customers, and its trading volumes this year have grown by 200% compared to the last year, Gupta told The Block, without disclosing specific figures.

The Series B brings CoinDCX’s total funding to date to $19.4 million. Previously, the exchange has raised $3 million in Series A and $2.5 million in a strategic funding round.

© 2020 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 U.S. Securities and Exchange Commission (SEC) is set to sue Ripple.

Fortune reports that the “lawsuit will also name Ripple’s CEO Brad Garlinghouse and cofounder Chris Larsen as defendants.” Brad Garlinghouse, Ripple’s CEO, told Fortune that SEC Chairman Jay Clayton “shamefully…has decided to sue Ripple, and leave the legal work to the next Chairman.”

Garlinghouse reiterated his comments in a series of posts on Twitter:

Today, the SEC voted to attack crypto. Chairman Jay Clayton – in his final act – is picking winners and trying to limit US innovation in the crypto industry to BTC and ETH. (1/3) https://t.co/r9bgT9Pcuu

— Brad Garlinghouse (@bgarlinghouse) December 22, 2020

The SEC – out of step with other G20 countries & the rest of the US govt – should not be able to cherry-pick what innovation looks like (especially when their decision directly benefits China). Make no mistake, we are ready to fight and win – this battle is just beginning. (3/3)

— Brad Garlinghouse (@bgarlinghouse) December 22, 2020

According to The Wall Street Journal, “the lawsuit revolves around whether XRP, a digital asset that the company launched in 2012, is actually a security that should have been registered with the SEC.”

In a November interview with The Block, Garlinghouse expressed his dissatisfaction with the regulatory environment in the U.S., telling The Block that there isn’t a “level playing field” for digital assets in the current regulatory climate adding that Ripple was “fighting with one hand tied behind our back.”

In October, Larsen, Ripple’s co-founder and executive chairman, warned that the firm may leave the U.S. for a more favorable jurisdiction.

Ripple’s general counsel, Stuart Alderoty, later published a Wells Submission — a kind of response to an official warning of pending enforcement action — in which the firm sought to rebut the SEC’s expected claims.

“The SEC’s theory, that XRP is an investment contract, is wrong on the facts, the law and the equities,” the firm said. “To prove its case amounts to an unprecedented and ill-conceived expansion of the Howey test and the SEC’s enforcement authority against digital assets.”

The submission’s contents suggest that the SEC’s lawsuit will focus in part on the firm’s sales of XRP, among other potential areas.

© 2020 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.

After the Financial Crimes Enforcement Network (FinCEN) proposed new transaction rules for self-hosted wallets last week, Coinbase is taking issue with the considerably shortened comment period. In a new letter to the regulator, Coinbase is calling for FinCEN to extend to the traditional 60 days. 

“FinCEN asked the public to provide comments in just 15 days, spanning Christmas Eve, Christmas Day, New Year’s Eve, and New Year’s Day, in the middle of a global pandemic — leaving just a handful of actual working days for comments,” said the letter.

Coinbase said it had valued a “productive” working relationship with FinCEN in the past but that the current expedited timeline is disappointing. 

“We have never seen such a rushed effort for such a significant proposed change in our industry,” the letter said.

Of the 24 separate questions industry players can address from the notice, Coinbase said responses would require detailed technical analyses and extensive cost assessments. It also calls for firms to consider the balance of customer privacy since reporting requirements in the proposed rule would mean transmitting customer identity information to the regulator.

“There is no emergency here; there is only an outgoing administration attempting to bypass the required consultation with the public to finalize a rushed rule before their time in office is done,” said Coinbase’s response.

© 2020 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.

Congress’s in-house research service says there’s no evidence the dollar is losing its place as the dominant reserve currency — but it may benefit lawmakers to look into how digital currency legislation could impact that status.

In its “The U.S. Dollar as the World’s Dominant Reserve Currency,” report, the Congressional Research Service said a closer look at the effects of the growing crypto space hasn’t yielded any significant cause for concern related to the dollar’s position.

However, it acknowledged that while “cryptocurrencies remain a small, volatile, and niche market,” central bank digital currencies (CBDCs) are on the rise, with 80% of central banks working on an offering, according to a Bank for International Settlements (BIS) survey. 

It recommended Congress continue analyzing the dollar’s status, especially in relation to economic and technological shifts. “To date, there is no evidence of a shift away from the U.S. dollar as the dominant reserve currency. However, Congress may wish to…consider how legislation in a range of policy areas, including sanctions and digital currency, might impact the dollar’s dominant reserve currency status,” the report states.

Legislation containing language for the creation of a digital dollar has been introduced before, but none have moved forward.

© 2020 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.

“She’s a star.”

That’s how one current employee described Emilie Choi, the once crypto outsider who over the past two years has slowly worked her way to the second most-powerful position at crypto unicorn Coinbase.

Last month, Choi — who led mergers and acquisitions for LinkedIn before joining the San Francisco-based firm — received a promotion, adding president alongside her chief operating officer title, the company confirmed to The Block. The promotion was announced to staff on December 16.

The promotion comes ahead of the exchange’s move to go public, which could happen as early as the first quarter of the year, according to people familiar with the situation. The firm filed an S1 for the IPO last week.

Ahead of a public offering, it is not unusual for a firm to make various changes, including to the makeup of its staff. In addition to promoting Choi, the firm announced a shakeup of its board. In addition to former Cisco CFO Kelly Kramer joining as chairperson of the Audit and Compliance Committee, a16z co-founder Marc Andreesseen is set to take on a more active role as board director. In July, Coinbase hosted its first-ever investor day.

Externally, Coinbase has brought on Goldman Sachs as its investment banker adviser for the market debut, according to Business Insider.

Choi’s history

As for Choi, the promotion was described by sources as a non-trivial event, noting the COO and president position as a “big role” for a soon-to-be publicly traded company. Since first joining the firm, sources say Choi’s skills and focus expanded at a rapid clip thanks to her being a “great operator.” Specifically, she played a role in recruiting key talent across the organization, including Max Branzburg. Branzburg joined Coinbase from Google as head of product and currently leads teams in product and growth. 

Choi has presided over one of  the most active M&A teams in the crypto market. Since she joined the company in March 2018, Coinbase has acquired more than a dozen firms including Neutrino and Tagomi, according to data collected by The Block Research. 

Choi started as someone focused on corporate business development, a mandate that expanded until she was named chief operating officer after the exit of president and then-COO Asiff Hirji in May 2019. Insiders say the latest promotion — although not unexpected — signals that Choi has cemented her leadership and almost partnership-like relationship with CEO Brian Armstrong.

It’s a welcome development for Coinbase, which dealt with power struggles between its former top brass, namely including skirmishes between its former CTO Balaji Srinivasan and Hirji. In June 2019, sources described the relationship between Choi and Armstrong as being similar to the chemistry between Facebook’s Mark Zuckerberg and COO Sheryl Sanberg. Since June, Armstrong has been more hands-on with product development.

In her new role, Choi will play a bigger role in aiding Armstrong with running the day-to-day operations of Coinbase, according to a company spokesperson.

Readers should expect further deals out of the Coinbase team. In the event of an IPO, the firm would have shares with which it could use as a currency for M&A — and Choi is uniquely positioned to take the lead on that front.

© 2020 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.

More than 4,500 bitcoin wallets are holding value in excess of $10 million, data collected by The Block Research shows.

The interactive graph below breaks down the number of bitcoin wallets with a balance of more than $X for different categories, ranging from those above $1,000 to more than $10 million. As the graph lines indicate, bitcoin’s price push above the $20,000 market had a noticeable impact on the data.

Indeed, more than 4.6 million bitcoin wallets were holding more than $1,000 in value as of December 20. Conversely, roughly 271,000 wallets were holding balances in excess of $100,000 of that date.

It should be noted that the number of wallets does not indicate the number of coin holders, as an individual’s holdings — or a business’s holdings — may be spread across many wallets.

© 2020 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.