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British crypto analytics startup CryptoCompare has secured a strategic investment from MV Index Solutions (MVIS), a subsidiary of New York-based asset manager VanEck.

The details of the investment were not disclosed, but a person familiar with the matter said it gives MVIS “a significant stake” in CryptoCompare.

“We are seeking to partner with leading firms in digital assets and blockchain technology and are happy to deepen that relationship by investing, when appropriate,” said Jan Van Eck, CEO of VanEck.

CryptoCompare sells real-time and historical data on over 5,000 tokens and more than 250,000 currency pairs to both institutional and retail investors. Its data APIs are widely used within the digital assets sector.

The London-based startup has been working closely with MVIS on crypto index products since 2017, when it launched the MVIS CryptoCompare Digital Assets 100 Index. That index tracks the performance of the 100 largest digital assets and serves as a benchmark for other crypto indices.

In April of this year, the pair licensed the MVIS CryptoCompare Ethereum Benchmark Rate and the MVIS CryptoCompare Bitcoin Benchmark Rate indices to 3iQ, the Canadian digital assets investment manager which recently launched Canada’s first crypto exchange-traded funds.

“As the leading data provider for digital assets we are excited to reaffirm our relationship with VanEck and MVIS, who are pioneering incumbent moves in digital assets,” said Charles Hayter, CEO and co-founder of CryptoCompare. 

MVIS offers a range of indices covering several asset classes including equity, fixed income, and digital assets. As of April 23 this year, approximately $28.76 billion was invested in products based on its indices. MVIS’s parent company VanEck, which was founded in 1955, had $71.2 billion in assets under management as of March 31, 2021.

The person with knowledge of the CryptoCompare investment said it had been agreed to late last year but didn’t close until earlier this week.

Since then, in line with the wider market, CryptoCompare has enjoyed a period of rapid growth. The company now has 430 paying data clients including regulators, financial institutions, and fintech and crypto unicorns. It is helping to run 40 indices with over £4 billion in assets under management.

© 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.

Blockchain analytics firm TRM Labs announced Thursday that it has raised $14 million in a Series A funding round.

The round was led by Bessemer Venture Partners, an investor in companies like LinkedIn and Shopify, with participation from several other existing and new investors. These include PayPal Ventures, Initialized Capital, Jump Capital, Salesforce Ventures, Y Combinator, unnamed executives from Google and Plaid, and several others.

As part of the deal, Bessemer partner Ethan Kurzweil has joined the TRM board.

With fresh capital at hand, San Francisco-based TRM plans to grow its business and expand its current team of 30 to 100 by the end of this year, the firm’s co-founder CEO Esteban Castano told The Block. TRM is hiring data engineers, data scientists, threat intelligence analysts, and sales and marketing staff, Castano said.

Founded in 2017, TRM Labs provides blockchain analytical tools to help financial institutions, government agencies, and crypto firms detect and manage crypto-related fraud and financial crime. Castano said TRM is seeing a surge in demand from clients and has seen its business grow 600% year over year.

When asked what is TRM’s competitive edge over rivals such as Chainalysis and Elliptic, Castano said TRM has the “largest coverage of ransomware and emerging risks on blockchains” with over 80 different risk categories.

“TRM is the first and only blockchain intelligence platform with native cross-chain analytics, meaning that customers can understand activity across blockchains, not just within them,” said Castano. TRM supports 360,000 digital assets across 20 blockchains, Castano added.

TRM’s Series A comes as the Biden administration is expanding cryptocurrency analysis to trace ransomware-tied transactions. When asked whether TRM has U.S. government agencies as clients, Castano said yes, but declined to share names.

The Series A brings TRM’s total funding to date to around $20 million. In 2019, TRM raised $4.2 million. Castano declined to share the firm’s valuation with the latest round.

© 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.

Quick Take

• Cross-chain bridges are becoming increasingly important pieces of the DeFi ecosystem as value continues to be spread amongst a growing list of blockchains
• Currently, most bridges transfer assets between chains by locking source assets and minting wrapped assets on the destination chain
• With sufficient liquidity in the future, cross-chain bridges like multichain.xyz or THORChain can enable decentralized asset bridging without requiring custody of assets

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Wedbush Securities, the U.S. broker and wealth manager with over $2 billion in assets under management, has joined Paxos’s blockchain settlement network for equities.

Announcing the news on Thursday, Wedbush said Paxos Settlement Service is a faster and more efficient way to settle stock trades. Using a private and permissioned blockchain network, Paxos lets two parties settle stock trades with each other on the same day.

Traditionally, equity settlement takes T+2 (trade date plus two days) and T+0 or same-day settlement for trades that occur before 11 am ET. Paxos Settlement Service, however, facilitates settlement on any time cycle.

Wedbush Securities is the fifth financial institution to join Paxos’s blockchain network, after Credit Suisse, Nomura’s Instinet, Societe Generale, and the Bank of America.

Paxos has two more slots left for its network. According to a no-action relief received from the U.S. Securities and Exchange Commission in 2019, Paxos can add no more than seven participants to its blockchain settlement network.

Paxos has said that it will apply for full clearing agency registration with the SEC, which will allow it to include more market participants onto the network.

© 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.

The capacity of the Bitcoin Lightning network has broken above 1,500 bitcoin, according to The Block’s Data Dashboard, an amount worth $61.3 million at current prices. 

The Lightning network is Bitcoin’s main scaling solution, designed to make it cheaper and faster to send small amounts of bitcoin. Typically payments on the network take just a few seconds and fees start from just 1 satoshi, or about $0.00038, according to Lightning explorer 1ML.

The network has been growing at a rapid rate since January, when its capacity was as low as 1,040 bitcoin. This means it has shot up by nearly 50% in under six months after taking three years to break significantly above 1,000 bitcoin. 

The number of nodes on the network has increased to 21,567, according to 1ML, although only 12,040 of them have channels that are online and active. Across the network, there are now more than 50,000 channels connecting the nodes together.

The Lightning network has also seen greater exposure in recent weeks with El Salvador’s government making bitcoin legal tender. The Lightning network is already popular in the country, with Lightning-enabled apps such as Strike and Bitcoin Beach, remaining at top of the Google Play Store’s local rankings.

© 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.

The National Republican Congressional Committee (NRCC), the U.S. House Republicans’ campaign arm, is set to accept donations in cryptocurrency.

Axios reported the news on Wednesday, saying that the NRCC has partnered with crypto payments processor BitPay for the initiative. That means crypto donations will be converted into U.S. dollars by BitPay before being deposited in the NRCC’s account.

The NRCC has become the first national party committee to accept crypto donations, while several federal political candidates in the past have solicited donations in crypto.

“We are focused on pursuing every avenue possible to further our mission of stopping Nancy Pelosi’s socialist agenda and retaking the House majority, and this innovative technology will help provide Republicans the resources we need to succeed,” Tom Emmer, a crypto-friendly U.S. Representative (Republican-Minnesota) and the NRCC chairman, told Axios.

Emmer is also co-chair of the Congressional Blockchain Caucus and a member of the House Financial Services Committee. He recently reintroduced his Safe Harbor for Forked Assets Act proposal that would prohibit the Internal Revenue Service (IRS) from leveraging penalties related to forked assets until it issues further guidance for taxpayers. Earlier this month, Emmer also asked the IRS to ease regulations on crypto donations to charitable organizations. 

© 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.

The Financial Conduct Authority, the United Kingdom’s financial services regulator, has published new research revealing steady growth in the number of adults who hold cryptocurrencies.

The research found that 2.3 million adults in the U.K. now hold crypto, up from 1.9 million last year. Awareness is also rising steadily, with 78% of adults now having heard of crypto, compared with 73% last year.

The FCA also found that enthusiasm for crypto is on the rise, with over half those who had invested in the sector saying they had a positive experience and are likely to invest again (up from 41% last year to 53%). This is perhaps to be expected, given the performance of bitcoin and other cryptocurrencies over the past 12 months.

Yet understanding of cryptocurrencies is in decline, according to the FCA. Its research shows that 71% of respondents were able to correctly identify the definition of cryptocurrency from a list of statements.

The FCA highlighted that many crypto projects are unregulated, pointing out that if something goes wrong an affected individual is unlikely to have access to the FSCS or the Financial Ombudsman Service for support.

“If consumers invest in these types of products, they should be prepared to lose all their money,” said Sheldon Mills, executive director of consumers and competition at the FCA.

The FCA has, over the past year, put in place measures to restrict consumer access to riskier forms of cryptocurrency trading. In January this year, the watchdog enforced a ban on the sale of crypto derivative products to retail investors, a move it estimated would prevent £53 million ($74 million) in consumer harm. 

© 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.

The World Bank has rejected the government of El Salvador’s request to help implement bitcoin as legal tender in the country.

Reuters reported the news on late Wednesday, saying that the international lender is concerned about bitcoin’s environmental and transparency issues.

“We are committed to helping El Salvador in numerous ways including for currency transparency and regulatory processes,” the World Bank told Reuters. “While the government did approach us for assistance on bitcoin, this is not something the World Bank can support given the environmental and transparency shortcomings.”

El Salvador had requested “technical assistance” from the World Bank, according to the country’s Finance Minister Alejandro Zelaya. Now that the request has been turned down, El Salvador’s timeline of accepting bitcoin across the country within three months could be impacted.

Earlier this month, El Salvador became the first country to classify bitcoin as legal tender, alongside the U.S. dollar, after the nation’s Congress approved President Nayib Bukele’s proposal to embrace the cryptocurrency.

Last week, the International Monetary Fund (IMF) also said it saw “macroeconomic, financial and legal issues” with El Salvador’s adoption of bitcoin. According to Zelaya, however, the IMF was “not against” the implementation of bitcoin.

© 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.

After raising $1.4 million earlier this year, the decentralized derivatives exchange SynFutures has netted an additional $14 million in a Series A round led by Polychain Capital.

Other participants in the round include Framework, Pantera Capital, Bybit, Wintermute, CMS, Kronos and IOSG Ventures. 

SynFutures’ platform allows users to add trading pairs of any assets with any maturity date, as well as list their own futures contracts. It’s currently onboarding users in closed alpha but plans to open up its platform next month with a mainnet launch. Part of the fresh funding will be used as the initial liquidity pool, with the rest dedicated to hiring and development costs.

SynFutures declined to share any valuation tied to the rounds.

The firm said in a statement that it was inspired to launch a derivatives-specific decentralized finance (DeFi) platform in the wake of the success of other DeFi venues this year like Uniswap. Decentralized exchange volume first saw an uptick last summer before leveling off. It’s now seeing a slower upward trend.

At the time of its seed round, SynFutures said it planned to partner with Bitmain and Huobi to support hashrate derivatives, which allow traders to speculate on the bitcoin network’s mining difficulty. While Bitmain remains a partner, regulatory headwinds surrounding Huobi leave the exchange’s ability to participate unclear, according to SynFutures.

CEO Rachel Lin, who founded SynFutures after her time as head of DeFi and lending at Matrixport, said she’s built a team with a variety of expertise, from those with doctorates in cryptography to talented engineers who hail from centralized and decentralized projects.

In the case of combatting flash loan attacks, Lin said the platform has introduced specific oracles to fight radical price movements that usually occur in these types of attacks. 

“Because we have the expertise in finance and blockchain, we’d love to bring lots of risk management methods, the best practices from traditional finance and CeFi to the DeFi space to prevent those, say flash loan attacks, and some of the other attacks in recent years that have been happening,” she said.

© 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.

A new decentralized autonomous organization (DAO) called BitDAO has been formed, and several high-profile investors, including Peter Thiel and Alan Howard, have backed its $230 million fundraise.

Thiel led the round, along with his Founders Fund, Pantera Capital, and Dragonfly Capital. Other investors in the round included Jump Capital, Spartan Group, Fenbushi, and Kain Warwick of Synthetix. The fundraise was realized via a private token sale round.

BitDAO’s initial proponent is crypto derivatives exchange Bybit. The exchange has, therefore, pledged a contribution of 2.5 basis points of its futures contracts trading volume to the BitDAO treasury, which at January-May 2021 run rate is expected to be more than $1 billion per year, said BitDAO.

The DAO wants to promote the growth of the decentralized finance (DeFi) sector by providing grants and liquidity to DeFi projects and setting up research and development (R&D) centers.

“BitDAO is putting its full support behind DeFi and will allocate significant financial and talent resources to drive DeFi growth,” the organization said in a statement shared with The Block on Wednesday. As for BitDAO-affiliated R&D centers, the DAO said those would aim to employ “hundreds” of people to help innovate and tackle technical challenges faced by the DeFi sector.

The DeFi industry is seeing an increasing interest from venture capitalists. As The Block Research reported recently, nearly 50% of crypto deals in the first quarter of this year were into DeFi projects. 

© 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.