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The U.S. President Donald Trump is said to be weighing a pardon for Ross Ulbricht, founder of the now-defunct dark web marketplace Silk Road who is serving a life sentence.

According to a report from The Daily Beast on Tuesday, the White House counsel office has been reviewing the documents related to Ulbricht’s case. Citing three people with knowledge of the matter, the report said Trump was informed of the case recently as well as the pleas from Ulbricht’s allies. 

Based on two of the three people familiar with the discussions, the report added that Trump “has at times privately expressed some sympathy for Ulbricht’s situation.”

As such, Trump has been considering Ulbricht, among others, for the next round of commutations and pardons prior to the inauguration of his 2020 presidential election opponent Joe Biden, the report said.

Ulbricht operated the Silk Road dark web marketplace under the alias of DPR, or Dread Pirate Roberts, from 2011 to 2013. The site, once a billion dollars business used for selling drugs and weapons, was shut down by the Federal Bureau of Investigation following the arrest of Ulbricht in late 2013.

In 2015, he was sentenced to serving a double life sentence without the possibility of parole.

It’s unclear if or when the Trump administration will make a decision on the Ulbricht case. The Daily Beast said Ulbricht has gained support from some influential figures within Trump’s political and social circle.

© 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

• Following its Airbnb market, FTX might roll out more contracts tied to companies that have yet to have their IPO debut.
• FTX told The Block it could launch contracts tied to Robinhood and Coinbase if it can figure out a way to properly structure them.

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This week saw open interest in bitcoin options and futures surge to new highs, according to data collected by The Block Research.

On Sunday, open interest for bitcoin options reached $4.81 billion. Open interest refers to the total amount of contracts that have yet to be settled at a given time.

Eighty-one percent of bitcoin options open interest was on market leader Deribit, followed by Bit.com (6%) and CME (5.4%).

Open interest on Bitcoin futures reached $7.38 billion, a new high, the following day, per the data. OKEx led the way at 18.9%. Binance and CME were nearly tied at 15.6% and 14%, respectively. 

© 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.

Derivatives exchange operator Cboe Global Markets is preparing to launch crypto indexes after inking a partnership with trading software firm CoinRoutes. 

The partnership provides Cboe with exclusive rights over the CoinRoutes RealPrice Best-Bid-Offer (BBO), which offers real-time crypto price data aggregated across several trading venues. Cboe plans to use the data to launch indexes tied to the digital asset market at the beginning of 2021, according to Catherine Clay, its senior vice president and head of information solutions.

Cboe would be the latest firm to announce interest in launching crypto data products. S&P Global recently announced a deal with crypto data services provider Lukka on its own indexes, which are set to launch next year. 

Indeed, the entrance of traditional financial services firms could help mature digital asset market data, which is known for its fragmentation and dislocations. Clay said CoinRoutes data is unique in the market given it is used to execute trades at what could be argued is the best possible price. 

“It is a hard-to-replicate data set,” she said. “It is an executive data point versus a theoretical data point — exactly the type of transparent and action data that informs trading decisions in different asset classes.”

As for the roadmap, Clay said that the data would initially be used by clients to aid in portfolio development and other pre-trade processes. In the future, Cboe could see those indexes utilized for various types of trading or structured products. 

“I do see this as a very large revenue opportunity for us, but equally as important it helps bring more participants into the digital asset ecosystem,” she said. “That raises the level of legitimacy and comfort in this space.”

To be sure, this wouldn’t be Cboe’s first attempt at taking a crack at crypto. Cboe stopped listing bitcoin futures in March 2019 after it failed to compete head-to-head with crosstown rival CME Group. Attempts to launch several bitcoin exchange-traded products were stymied by opposition within the U.S. Securities and Exchange Commission. 

Cboe’s partnership with CoinRoutes could possibly open the door to such a product in the future, according to CoinRoutes CEO Dave Weisberger. 

He said the data address a number of concerns previously outlined by the agency, including a level of transparency that “wouldn’t be unparalleled and should be a game-changer for regulators.”

“First, RealPrice is much less susceptible to manipulation than Bitcoin indexes. That is due to the fact that weighting is not arbitrary, but rather based on the actual executable order book,” Weisberger said. Previous ETF proposals were based on indexes that were not usable for execution purposes.

“Second, with access to all of our cross-market data, Cboe would be able to flag strange divergences in price across markets,” he continued, referring to the SEC’s concerns about market manipulation that could impact trading in a product available to retail clients. 

Still, it wouldn’t address several other issues regulators have expressed about a bitcoin ETF, including custody concerns and exchange breaches. 

© 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.

A long-delayed rehabilitation plan for the bankrupt bitcoin exchange Mt Gox has been filed in a Tokyo court. 

A short notice issued on December 15 — two months after the previous deadline — indicated only that “the Rehabilitation Trustee filed a draft rehabilitation plan. The Tokyo District Court and an examiner will review the draft rehabilitation plan and determine whether to proceed with the rehabilitation proceedings relevant to the draft rehabilitation plan.”

“The Rehabilitation Trustee plans to explain the draft rehabilitation plan to the relevant parties in a timely and appropriate manner,” the notice concluded.

The long-in-development rehabilitation plan comes years after Mt Gox collapsed amid allegations of fraud and mismanagement. It ultimately declared bankruptcy amid an investigation into the loss of hundreds of millions of dollars in bitcoin, but the exchange eventually entered a civil rehabilitation process through which claimants could seek to recoup some of their lost funds.

The Mt Gox triggered a wave of regulatory reactions in response to the emerging use of bitcoin as well as the companies that provide related services. 

© 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.

Lottery winners of Chinese city Suzhou’s $3 million digital yuan red packets are now able to spend their free central bank digital currency, known as DC/EP.

Video reviews of the ongoing test by Chinese state-owned media show that residents who have activated a DC/EP wallet can pay not only via regular QR codes but also by merely touching their smartphones with a merchant’s sensor device.

The Block has previously reported on the six major ways Suzhou’s DC/EP test is different from the one conducted in Shenzhen in October.

The contact feature, with or without internet connections, is one feature that differentiates DC/EP transactions from mobile payment giants like AliPay or WeChat, where payments can only be initiated by scanning QR codes.

Five seconds

According to a state media Jiangsu TV report on Monday, a local resident surnamed Wu bought a product at a physical shop owned by Chinese e-commerce giant JD.com in Suzhou, Jiangsu province — right after the city-wide DC/EP test officially started on December 11.

The video clip, embedded below at timestamp 00:14, shows that after activating his DC/EP wallet and choosing the touching feature, Wu touched his mobile phone with a digital yuan sensor device installed at the JD shop. The interface on his smartphone was instantly directed to a page where he could type in the price and complete the payment.  

The touching feature exists alongside QR codes that are also supported in the Suzhou test. A QR code is the only payment method on Chinese mobile payment giants AliPay or WeChat Pay where users can either scan a merchant’s receiving QR code or having a merchant to scan their paying QR code to complete transactions.

However, DC/EP’s touching feature can only be tested between a lottery-winner and a merchant. Individual residents cannot send each other DC/EP via touching their smartphones at this stage. 

In addition to touching devices with internet connections, the Suzhou trial has rolled out an invite-only test for offline transactions by having smartphones touch each other without network access.

The same Jiangsu TV news clip, at timestamp 1:00, shows that a customer tested a payment of 7.9 yuan, about $1.2, by touching her smartphone back-to-back with a merchant’s smartphone while both devices turned off cellular or WiFi signal. It appears the offline transaction process took about five seconds as shown in the video.

DC/EP sub-wallet

Another new feature that was revealed in the Suzhou test is the sub-wallet push function, which is what enables the spending of DC/EP in online scenarios. 

A review video from The Beijing News, from timecode 00:45, shows that if Suzhou users want to spend their digital yuan on JD.com’s mobile app, they need to tap on the top-right corner of their DC/EP wallets to enable a JD sub-wallet push. After that, they will find a DC/EP payment option available on their mobile JD.com app.

JD.com said it received nearly 20,000 DC/EP orders in the first 24 hours after the Suzhou test started at 8:00 pm China time on December 11. 

In addition to JD.com, The Block reported last week that three Chinese internet giants are also taking part in the Suzhou test: ride-hailing giant DiDi, food delivery platform Meituan and video streaming platform Bilibili.

Indeed, the Beijing News’ review video shows additional sub-wallet push functions for Meituan’s bike-sharing and DiDi are available if users have activated their DC/EP wallets with Industrial and Commercial Bank of China.

DC/EP sub-wallet push via The Beijing News review video

More to come

The Suzhou test will end on December 27 and any unspent digital yuan will be collected back by the government.

That said, a second news clip from Jiangsu TV indicated that more DC/EP in red packets will arrive in Suzhou in different amounts during several upcoming festivals, including the Winter Solstice, New Year, the Lunar New Year as well as the Lantern Festival.

Speaking of the experience thus far, a customer identified as Miss Ma said she found the offline payment “quite convenient,” especially for scenarios where the cellular signal can be weak, if not completely unavailable.

One shop owner, identified as Mr. Ma, said one advantage for him as a merchant is there’s no transaction fee if he wants to convert his DC/EP into bank savings. 

By comparison, there’s no charge for Chinese users to top up their AliPay or WeChat Pay wallets with their bank accounts. But there’s typically a 0.1% transaction fee if they want to withdraw funds from AliPay or WeChat Pay wallets back to their banks. 

Ma said his shop sold some 600 yuan — about $90 — worth of goods in seven or eight DC/EP transactions within hours after the Suzhou test began.

“It’s just like cash but with a mobile wallet for funds to go in and out,” Ma said of his test experience. “And there’s no transaction fee if I move the funds from a DC/EP to my bank account.”

© 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.

Multi-billion dollar management firm Ruffer said Tuesday that one of its funds has bought bitcoin.

The Guernsey-based firm, which according to its website had £20.3 billion in assets under management (AUM) has of November 30, disclosed the purchase in a notice published by the London Stock Exchange on December 15.

“One recent addition, via one of the specialist managers appointed within the Ruffer Multi-Strategies Fund, has been bitcoin. This is primarily a defensive move, one made in November after reducing the company’s exposure to gold,” the firm said, going on to explain:

“The exposure to bitcoin is currently equivalent to around 2.5% of the portfolio. We see this as a small but potent insurance policy against the continuing devaluation of the world’s major currencies. Bitcoin diversifies the company’s (much larger) investments in gold and inflation-linked bonds, and acts as a hedge to some of the monetary and market risks that we see.”

It’s not currently clear how much bitcoin the firm purchased, but some back-of-the-napkin math offers clues about the size of the “small but potent insurance policy” referenced.

An LSE filing from February indicates that the Ruffer Illiquid Multi Strategies Fund 2015 held roughly £55.4 million ($74.4 million) as of December 31.

An interim filing from The International Stock Exchange (TISE) and published December 14 (covering the period as of September 30) indicates that Ruffer Illiquid Multi Strategies Fund 2015 Limited has a total of £1.13 billion invested, or about $1.5 billion. Based on that figure, the Ruffer fund may have bought as much as $37.5 million in bitcoin.

Ruffer did not immediately respond to requests for comment. 

© 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.

CoinList has added support for tBTC, an ERC-20 token backed one-to-one by bitcoin.

The move allows CoinList users to mint tBTC directly from their bitcoin wallets. tBTC is the second tokenized form of bitcoin added by CoinList after WBTC.

Such tokens allow users to participate in Ethereum-based decentralized finance (DeFi) applications and unlock yield-earning opportunities.

WBTC is the largest tokenized bitcoin, having a market share of nearly 80%. renBTC ranks second, followed by HBTC and tBTC.

When asked why added support for tBTC instead of renBTC, CoinList CEO Graham Jenkin told The Block that renBTC already gets “great support” on Curve and other platforms, so there was less direct demand for it on CoinList.

“So while renBTC support is on our roadmap, tBTC is where we’re seeing demand right now,” said Jenkin. “Part of this is due to the level of auditing that tBTC has undergone, as well as Nexus Mutual’s role in protecting funds. These additional pieces are clearly giving our users confidence in tBTC.”

© 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.

Long bitcoin, short the dollar?

Those two trades have been deemed among the most crowded by fund managers surveyed this month by Bank of America/BofA Securities.

As part of the firm’s Global Fund Manager Survey, which goes out every month, “long bitcoin” is considered the third-most crowded trade among those surveyed. Meanwhile,  participants in the survey found “short US dollar” to be the second-most crowded trade and “long tech” as the most crowded trade.

The US dollar has been getting clobbered, trading at more than two-year lows.. Meanwhile, bitcoin is up more than 20% over the last month. Tech stocks have been enjoying a nice run as well, fueled by new public market debuts like Airbnb. The tech-heavy Nasdaq Composite index is up more than 5% over the past month. 

FMS investors, according to the survey, think that run will continue, with optimism on risk-on assets including stocks hitting its highest level since 2011. 

© 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.

Users can now trade bitcoin on the newly-launched decentralized trading and lending platform Sovryn, the platform announced on Tuesday.

The team behind Sovryn, which was built on the Bitcoin-powered smart contract platform RSK, says it will soon launch its decentralized governance platform as well. 

The launch comes after Sovryn raised $2.1 million in funding. Investors in the round included Greenfield One, Collider Ventures and Monday Capital. 

Sovryn allows for native and noncustodial trading and lending of bitcoin. According to the announcement, users that own BTC, USDT and the Dollar on Chain (DOC) stablecoin can earn interest by lending their assets. 

“Bitcoin created a decentralized monetary system. With Sovryn we are providing Bitcoin with a decentralized financial system as well,” said Sovryn community founder Edan Yago.

The platform is planning to launch its decentralized governance contracts later this month. 

© 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.