Russian Central Bank Proposes Crypto Use and Mining Ban, Bitcoin Moves Up
The central Bank of Russia today proposed banning the use and mining of cryptoaassets on the country's territory. The proposed ban encompasses crypto exchanges.
However, despite the news, bitcoin (BTC) moved up. At 16:49 UTC, BTC trades at USD 43,324 and is up 3% in a day, trimming its weekly losses to less than 2%.
The bank is citing threats to financial stability, economic security, and monetary policy sovereignty to justify this move.
The bank's report argues that the crypto growth is the product of speculative demand, that these assets resemble financial pyramid schemes, and that market bubbles may form which would endanger both the users and the Russian financial system.
"Potential financial stability risks associated with cryptocurrencies are much higher for emerging markets, including in Russia," the report said, adding that this is due to "the traditionally higher propensity for saving in foreign currency and an insufficient level of financial literacy.”
Therefore, the proposal encompasses financial institutions and prevents them from dealing with crypto. Because these measures would aim to block transactions revolving around purchasing or selling crypto for fiat, the ban would include crypto exchanges in the country as well.
Furthermore, the report claims that mining is jeopardizing the country's energy supply, as well as its green energy plans, among other things.
"The Central Bank of Russia has no plans to put a ban for the use of cryptocurrencies on individuals as Elizabeth Danilova – head of the Department of financial stability of the Central Bank of Russia has remarked in her press conference dedicated to public consultations ‘Cryptocurrencies: trends, risks, measures’. Currently, there are no talks about a ban for cryptocurrency ownership for the citizens in Russia," Islam Shazhaev, the CEO of OneBoost, a digital asset management company, said in an emailed comment.
Russia is considered to be the third-largest crypto miner in the world, preceded by the US and Kazakhstan, especially after the exodus of miners from China following its own ban.
"Russia only hosts a little more than 10% of Bitcoin's current mining power. When and if the ban is finally enforced - which could still take some time - Russian miners may be forced to move their operations elsewhere but any effect of this development on Bitcoin’s price will be extremely short-lived," Anto Paroian, Chief Operating Officer, at crypto hedge fund ARK36, said in an emailed comment.
He stressed that the crypto market seemed initially undeterred by the news of the ban and the major assets, including BTC, continued to post modest gains throughout the day.
The central Bank of Russia today proposed banning the use and mining of cryptoaassets on the country's territory. The proposed ban encompasses crypto exchanges.
However, despite the news, bitcoin (BTC) moved up. At 16:49 UTC, BTC trades at USD 43,324 and is up 3% in a day, trimming its weekly losses to less than 2%.
The bank is citing threats to financial stability, economic security, and monetary policy sovereignty to justify this move.
The bank's report argues that the crypto growth is the product of speculative demand, that these assets resemble financial pyramid schemes, and that market bubbles may form which would endanger both the users and the Russian financial system.
"Potential financial stability risks associated with cryptocurrencies are much higher for emerging markets, including in Russia," the report said, adding that this is due to "the traditionally higher propensity for saving in foreign currency and an insufficient level of financial literacy.”
Therefore, the proposal encompasses financial institutions and prevents them from dealing with crypto. Because these measures would aim to block transactions revolving around purchasing or selling crypto for fiat, the ban would include crypto exchanges in the country as well.
Furthermore, the report claims that mining is jeopardizing the country's energy supply, as well as its green energy plans, among other things.
"The Central Bank of Russia has no plans to put a ban for the use of cryptocurrencies on individuals as Elizabeth Danilova – head of the Department of financial stability of the Central Bank of Russia has remarked in her press conference dedicated to public consultations ‘Cryptocurrencies: trends, risks, measures’. Currently, there are no talks about a ban for cryptocurrency ownership for the citizens in Russia," Islam Shazhaev, the CEO of OneBoost, a digital asset management company, said in an emailed comment.
Russia is considered to be the third-largest crypto miner in the world, preceded by the US and Kazakhstan, especially after the exodus of miners from China following its own ban.
"Russia only hosts a little more than 10% of Bitcoin's current mining power. When and if the ban is finally enforced - which could still take some time - Russian miners may be forced to move their operations elsewhere but any effect of this development on Bitcoin’s price will be extremely short-lived," Anto Paroian, Chief Operating Officer, at crypto hedge fund ARK36, said in an emailed comment.
He stressed that the crypto market seemed initially undeterred by the news of the ban and the major assets, including BTC, continued to post modest gains throughout the day.
Ethereum, Altcoins Extend Losses Against Bitcoin as BTC Tests USD 34K Zone
On Saturday, the crypto market dropped further, with bitcoin (BTC) reaching price levels last seen in July 2021, while ethereum (ETH) extended its losses against BTC.
On Saturday, the crypto market dropped further, with bitcoin (BTC) reaching price levels last seen in July 2021, while ethereum (ETH) extended its losses against BTC.
At 10:15 UTC, BTC trades at around USD 34,363 and down 13% in a day and 30% in a month, trimming its annual gains to less than 11%. Meanwhile, ETH is down 19%, trading at USD 2,332. The price is also down 42% in a month, but is still up 108% in a year.
Other coins from the top 10 club are down 19%-30% in a day. Liquidations in the crypto derivatives market surpassed USD 1bn as more than 351,680 trading positions were liquidated in the past 24 hours, per Coinglass data.
As reported, the market dropped following a selloff led by technology stocks in the US this week.
"Bitcoin’s continued selloff is driving speculators out the market. However, with leverage quick to build up around this asset, the market could be setting itself up for a short squeeze and relief rally,” Ben Caselin, Head of Research and Strategy at crypto exchange AAX, told Cryptonews.com on Friday.
He added that the selloff is likely “not too concerning” for long-term holders, although it could turn away some newcomers to the space. In particular, this is the case for “those who are trading meme coins and other hype-based tokens,” the analyst said.
While there have been much larger percentage drawdowns for both bitcoin and the aggregate market, this marks the second-largest ever decline in dollar terms for both, Bloomberg reported, citing Bespoke Investment Group. "It gives an idea of the scale of value destruction that percentage declines can mask," per the analysts at the group.
"Bitcoin is being battered by a wave of risk-off sentiment. For further cues, keep an eye on traditional markets. Fear and unease among investors is palpable," Antoni Trenchev, Nexo Co-founder and Managing Partner, was quoted as saying by Bloomberg.
On Saturday, the crypto market dropped further, with bitcoin (BTC) reaching price levels last seen in July 2021, while ethereum (ETH) extended its losses against BTC.
On Saturday, the crypto market dropped further, with bitcoin (BTC) reaching price levels last seen in July 2021, while ethereum (ETH) extended its losses against BTC.
At 10:15 UTC, BTC trades at around USD 34,363 and down 13% in a day and 30% in a month, trimming its annual gains to less than 11%. Meanwhile, ETH is down 19%, trading at USD 2,332. The price is also down 42% in a month, but is still up 108% in a year.
Other coins from the top 10 club are down 19%-30% in a day. Liquidations in the crypto derivatives market surpassed USD 1bn as more than 351,680 trading positions were liquidated in the past 24 hours, per Coinglass data.
As reported, the market dropped following a selloff led by technology stocks in the US this week.
"Bitcoin’s continued selloff is driving speculators out the market. However, with leverage quick to build up around this asset, the market could be setting itself up for a short squeeze and relief rally,” Ben Caselin, Head of Research and Strategy at crypto exchange AAX, told Cryptonews.com on Friday.
He added that the selloff is likely “not too concerning” for long-term holders, although it could turn away some newcomers to the space. In particular, this is the case for “those who are trading meme coins and other hype-based tokens,” the analyst said.
While there have been much larger percentage drawdowns for both bitcoin and the aggregate market, this marks the second-largest ever decline in dollar terms for both, Bloomberg reported, citing Bespoke Investment Group. "It gives an idea of the scale of value destruction that percentage declines can mask," per the analysts at the group.
"Bitcoin is being battered by a wave of risk-off sentiment. For further cues, keep an eye on traditional markets. Fear and unease among investors is palpable," Antoni Trenchev, Nexo Co-founder and Managing Partner, was quoted as saying by Bloomberg.
OpenSea Is Reportedly Being Exploited
Major non-fungible token (NFT) platform OpenSea is reportedly under attack, with the perpetrator drawing out hundreds of ethereum (ETH).
Security and data analytics company PeckShield said today that OpenSea seems to be experiencing “a front-end issue,” while the exploiter got some ETH 332 (754,885).
At the time of writing (11:18 UTC), the shared address, per Etherscan, holds ETH 347 (USD 788,991). It shows 8 transactions, all completed within four hours.
The frontend refers to all the aspects of a software, website, platforms etc, with which the user interacts. An attacker may seek to identify attack vectors there, looking for subsystems with vulnerabilities.
Meanwhile, commenters are disagreeing on what may stand behind these transactions, with some also offering options such as “fatfinger seller”, or users not properly canceling their offers.
Major non-fungible token (NFT) platform OpenSea is reportedly under attack, with the perpetrator drawing out hundreds of ethereum (ETH).
Security and data analytics company PeckShield said today that OpenSea seems to be experiencing “a front-end issue,” while the exploiter got some ETH 332 (754,885).
At the time of writing (11:18 UTC), the shared address, per Etherscan, holds ETH 347 (USD 788,991). It shows 8 transactions, all completed within four hours.
The frontend refers to all the aspects of a software, website, platforms etc, with which the user interacts. An attacker may seek to identify attack vectors there, looking for subsystems with vulnerabilities.
Meanwhile, commenters are disagreeing on what may stand behind these transactions, with some also offering options such as “fatfinger seller”, or users not properly canceling their offers.
Putin Talks up Russia’s Crypto Credentials as Ukraine Tension Mount
Recent talk of a ban on crypto in Russia may be premature – particularly after the nation’s President Vladimir Putin appeared to talk up the country’s crypto capabilities. And with the United States threatening to sanction the Russian leader over heightened tensions on the Ukrainian border, Putin may be keeping his options open.
In a video cabinet meeting, which was transcribed by the Kremlin’s official website, Putin stated that “as for cryptocurrencies, the Central Bank has its own position on the matter.” He noted that “according to the experts at the Central Bank,” the “expansion” of crypto “poses certain risks.”
As previously reported, the Central Bank last week reiterated its calls on the government to ban all forms of crypto and crypto mining – but has been met with opposition from MPs and the government, some of whom have claimed that such talk makes Russia a “laughing stock” in international communities.
However, Putin stated that “of course, we also have certain competitive advantages” in the realm of crypto, “especially in the field of crypto mining.” Putin added that Russia’s electricity surplus and its preponderance of “well-trained personnel in the country” were also advantageous.
The President concluded by stating:
“I ask both the government of Russia and the Central Bank to come to some kind of unanimous opinion during their forthcoming discussion on the matter. I ask them to hold these discussions in the near future, and then report on the results of this discussion.”
That discussion will likely come next month, when senior government officials meet the Central Bank and industry leaders in a bid to hash out a comprehensive piece of legislation to cover crypto trading, ownership, and mining.
Recent talk of a ban on crypto in Russia may be premature – particularly after the nation’s President Vladimir Putin appeared to talk up the country’s crypto capabilities. And with the United States threatening to sanction the Russian leader over heightened tensions on the Ukrainian border, Putin may be keeping his options open.
In a video cabinet meeting, which was transcribed by the Kremlin’s official website, Putin stated that “as for cryptocurrencies, the Central Bank has its own position on the matter.” He noted that “according to the experts at the Central Bank,” the “expansion” of crypto “poses certain risks.”
As previously reported, the Central Bank last week reiterated its calls on the government to ban all forms of crypto and crypto mining – but has been met with opposition from MPs and the government, some of whom have claimed that such talk makes Russia a “laughing stock” in international communities.
However, Putin stated that “of course, we also have certain competitive advantages” in the realm of crypto, “especially in the field of crypto mining.” Putin added that Russia’s electricity surplus and its preponderance of “well-trained personnel in the country” were also advantageous.
The President concluded by stating:
“I ask both the government of Russia and the Central Bank to come to some kind of unanimous opinion during their forthcoming discussion on the matter. I ask them to hold these discussions in the near future, and then report on the results of this discussion.”
That discussion will likely come next month, when senior government officials meet the Central Bank and industry leaders in a bid to hash out a comprehensive piece of legislation to cover crypto trading, ownership, and mining.
Goldman Sachs Claims Adoption Won’t Boost Crypto Prices, Talks Down Stablecoin Plans
Goldman Sachs has warned crypto buyers that increased token adoption will no longer drive up prices, and that macroeconomic factors are now exerting a greater influence on the markets. And the firm appears to have tempered its interest in launching a stablecoin.
The crypto price warning came in a note authored by two of the firm’s strategists, Zach Pandl and Isabella Rosenberg, Bloomberg reported.
The duo claimed that recent selling strategies suggested that adoption was not driving prices. They explained that recent crypto selloffs showed that “mainstream adoption can be a double-edged sword.” They explained:
“While adoption can raise valuations, it will also likely raise correlations with other financial market variables, reducing the diversification benefit of holding the asset class.”
Instead, the authors stated, macroeconomic factors and price movement in conventional macro assets are likely to sway prices in the long term.
According to them, over time, further development of blockchain technology, including applications in the metaverse, may provide a secular tailwind to valuations for certain digital assets.
"But these assets will not be immune to macroeconomic forces, including central bank monetary tightening,” the authors noted.
Indeed, crypto prices’ correlation with other macro assets, the duo explained, has now increased to the point whereby crypto “is now at the center of recent rotations across asset classes.”
They pointed to the apparent positive correlation of bitcoin (BTC) prices with “proxies for consumer-price risk,” including “breakeven inflation” and crude oil prices – as well as “frontier” tech firm stock. By contrast, they said, there is now a negative correlation between crypto price and real interest rates and the USD.
As reported, central banks like the Federal Reserve had moved to tighten monetary policy in recent months, driving rates up and forcing USD prices up – factors that have hurt crypto and technology stocks alike.
Meanwhile, Goldman Sachs could well become the latest major company to rein in – or at least delay – its so-called “global” stablecoin plans.
Goldman Sachs has warned crypto buyers that increased token adoption will no longer drive up prices, and that macroeconomic factors are now exerting a greater influence on the markets. And the firm appears to have tempered its interest in launching a stablecoin.
The crypto price warning came in a note authored by two of the firm’s strategists, Zach Pandl and Isabella Rosenberg, Bloomberg reported.
The duo claimed that recent selling strategies suggested that adoption was not driving prices. They explained that recent crypto selloffs showed that “mainstream adoption can be a double-edged sword.” They explained:
“While adoption can raise valuations, it will also likely raise correlations with other financial market variables, reducing the diversification benefit of holding the asset class.”
Instead, the authors stated, macroeconomic factors and price movement in conventional macro assets are likely to sway prices in the long term.
According to them, over time, further development of blockchain technology, including applications in the metaverse, may provide a secular tailwind to valuations for certain digital assets.
"But these assets will not be immune to macroeconomic forces, including central bank monetary tightening,” the authors noted.
Indeed, crypto prices’ correlation with other macro assets, the duo explained, has now increased to the point whereby crypto “is now at the center of recent rotations across asset classes.”
They pointed to the apparent positive correlation of bitcoin (BTC) prices with “proxies for consumer-price risk,” including “breakeven inflation” and crude oil prices – as well as “frontier” tech firm stock. By contrast, they said, there is now a negative correlation between crypto price and real interest rates and the USD.
As reported, central banks like the Federal Reserve had moved to tighten monetary policy in recent months, driving rates up and forcing USD prices up – factors that have hurt crypto and technology stocks alike.
Meanwhile, Goldman Sachs could well become the latest major company to rein in – or at least delay – its so-called “global” stablecoin plans.
Low Real Interest Rates Support Asset Prices, But Risks Rising for Market
Nassira Abbas is a deputy division chief in the Global Markets Monitoring and Analysis Division of the Monetary and Capital Markets Department at the International Monetary Fund (IMF). Tobias Adrian is the Financial Counsellor and Director of the IMF’s Monetary and Capital Markets Department.
Supply disruptions coupled with strong demand for goods, rising wages, and higher commodities prices continue to challenge economies worldwide, pushing inflation above central bank targets.
To contain price pressures, many economies have started tightening monetary policy, leading to a sharp increase in nominal interest rates, with long-term bond yields, often an indicator of investor sentiment, recovering to pre-pandemic levels in some regions such as the United States.
Investors often look beyond nominal rates and base their decisions on real rates—that is, inflation-adjusted rates—which help them determine the yield on assets. Low real interest rates induce investors to take more risks.
Despite somewhat tighter monetary conditions and the recent upward move, longer-term real rates remain deeply negative in many regions, supporting elevated prices for riskier assets. Further tightening may still be required to tame inflation, but this puts asset prices at risk. More and more investors could decide to sell risky assets as those would become less attractive.
Nassira Abbas is a deputy division chief in the Global Markets Monitoring and Analysis Division of the Monetary and Capital Markets Department at the International Monetary Fund (IMF). Tobias Adrian is the Financial Counsellor and Director of the IMF’s Monetary and Capital Markets Department.
Supply disruptions coupled with strong demand for goods, rising wages, and higher commodities prices continue to challenge economies worldwide, pushing inflation above central bank targets.
To contain price pressures, many economies have started tightening monetary policy, leading to a sharp increase in nominal interest rates, with long-term bond yields, often an indicator of investor sentiment, recovering to pre-pandemic levels in some regions such as the United States.
Investors often look beyond nominal rates and base their decisions on real rates—that is, inflation-adjusted rates—which help them determine the yield on assets. Low real interest rates induce investors to take more risks.
Despite somewhat tighter monetary conditions and the recent upward move, longer-term real rates remain deeply negative in many regions, supporting elevated prices for riskier assets. Further tightening may still be required to tame inflation, but this puts asset prices at risk. More and more investors could decide to sell risky assets as those would become less attractive.
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Another Case for Bitcoin as Lebanon Reportedly Targets Depositors’ Fiat
Lebanon allegedly plans to forcibly convert foreign currency holdings to its floundering pound (LBP), once again building a case for Bitcoin (BTC).
Earlier this week, Reuters reported that it had seen a government “blueprint” plan designed to fight the ongoing financial crisis. The plan, the news agency wrote, “projects a 93% devaluation of the Lebanese pound and converts the bulk of hard currency deposits in the banking system to local currency.”
Investors would potentially face enormous losses if the plan were put into action. Reuters continued by stating that “of USD 104bn of hard currency deposits,” the plan’s authors “foresee returning just USD 25bn to savers in USD, with most of what’s left converted to LBP at several exchange rates, including one that would wipe 75% off some deposits.”
And while the government allegedly plans to repay “all depositors,” it will do so over “a 15-year time frame.”
Alex Gladstein, Chief Strategy Officer at the Human Rights Foundation, bemoaned the fact that the world was “watching” as “as thieving bureaucrats loot the currency of a once-proud nation.”
From the Bitcoin community, the message was clear, and went something like this: “Bitcoin fixes this.”
The Castle Island Ventures Partner Nic Carter opined that the Lebanon report was” a tale as old as time,” and could see depositors “given a massive haircut.” However, he stated that it was “only a matter of time until crypto dollarization becomes the default and robs these central banks of their prime weapon.”
The podcaster Neil Jacobs shared a video featuring comments from the Mexican billionaire and bitcoin bull Ricardo Salinas Pliego. The latter stated:
“Everything we have in fiat is 100% seizable by the government. People don’t realize this …. But that’s a fact.”
Lebanon allegedly plans to forcibly convert foreign currency holdings to its floundering pound (LBP), once again building a case for Bitcoin (BTC).
Earlier this week, Reuters reported that it had seen a government “blueprint” plan designed to fight the ongoing financial crisis. The plan, the news agency wrote, “projects a 93% devaluation of the Lebanese pound and converts the bulk of hard currency deposits in the banking system to local currency.”
Investors would potentially face enormous losses if the plan were put into action. Reuters continued by stating that “of USD 104bn of hard currency deposits,” the plan’s authors “foresee returning just USD 25bn to savers in USD, with most of what’s left converted to LBP at several exchange rates, including one that would wipe 75% off some deposits.”
And while the government allegedly plans to repay “all depositors,” it will do so over “a 15-year time frame.”
Alex Gladstein, Chief Strategy Officer at the Human Rights Foundation, bemoaned the fact that the world was “watching” as “as thieving bureaucrats loot the currency of a once-proud nation.”
From the Bitcoin community, the message was clear, and went something like this: “Bitcoin fixes this.”
The Castle Island Ventures Partner Nic Carter opined that the Lebanon report was” a tale as old as time,” and could see depositors “given a massive haircut.” However, he stated that it was “only a matter of time until crypto dollarization becomes the default and robs these central banks of their prime weapon.”
The podcaster Neil Jacobs shared a video featuring comments from the Mexican billionaire and bitcoin bull Ricardo Salinas Pliego. The latter stated:
“Everything we have in fiat is 100% seizable by the government. People don’t realize this …. But that’s a fact.”
Bitcoin Returns Above USD 40K, Ethereum Nears USD 3K
On Friday, bitcoin (BTC) rallied and returned above the USD 40,000 level for the first time in two weeks, while ethereum (ETH) neared the USD 3,000 level.
At 17:00 UTC, BTC trades at USD 40,426 and is up almost 10% in a day and 9% in a week. ETH jumped 12%, surpassing USD 2,950. It's also up 22% in a week.
Other coins from the top 10 club are up 5%-13% in a day.
As reported today, some analysts argue that BTC and ETH may be bottoming or are soon to bottom – but with cautionary words attached against premature bullishness.
"The current rise came after considerable rangebound price action that saw volumes drying and shorts increasing. Typically when the market is heavily leaning on one side of a trade (too long or too short), the price can move to counter that weight and squeeze positions," Joe DiPasquale, CEO of crypto hedge fund BitBull Capital, wrote in an emailed comment.
According to him, in the last two years, risk-on equities and bitcoin have been positively correlated, but this was not the case overall previously.
"This week, the Nasdaq and S&P 500 have recovered where they were before Jan 21, the day BTC sold off from USD 43k to USD 35k. With equities’ partial recovery, all things being equal, we expected to see BTC back to USD 40-41k," DiPasquale added.
Meanwhile, this jump today is also attributed to recent positive developments in the stock market.
"The fact that AMZN’s earnings went the way of AAPL, MSFT and GOOGL -- and not the way of FB -- has given investors more confidence to reengage with the risk-on trade," Matt Maley, Chief Market Strategist at Miller Tabak + Co., told Bloomberg. Also, today was announced that the US economy created far more jobs than expected in January. Nonfarm payrolls increased by 467,000 jobs last month while economists polled by Reuters had forecast 150,000 jobs would be added in January.
Also, according to Hayden Hughes, CEO at Alpha Impact, a trading social media platform, although there were concerns about accelerating monetary policy, there is now a sense among many capital markets that a 50 basis point rate hike is priced in given recent movements in equity markets.
However, Will Hamilton, Head of Trading and Research at Trovio Capital Management, said that throughout this period of consolidation changes in the derivatives market indicate traders continuing to bet on further downside.
"Futures funding has remained in a sustained period of negativity indicating a modest short bias in the perpetuals market, whilst the bitcoin put/call ratio has hit 58%, a level last seen in the FY21 May-July bear market, indicating a strong desire for downside protection," he said in an emailed comment.
According to him, from an on-chain perspective, further accumulation is evident as new and existing investors continue to increase holdings.
"The number of new bitcoin wallets with a >0 zero balance has hit all-time high of 40.12m during this recent pullback whilst total exchange reserves have declined to multi-year lows, reaching 13.27% of the total circulating supply," Hamilton noted.
On Friday, bitcoin (BTC) rallied and returned above the USD 40,000 level for the first time in two weeks, while ethereum (ETH) neared the USD 3,000 level.
At 17:00 UTC, BTC trades at USD 40,426 and is up almost 10% in a day and 9% in a week. ETH jumped 12%, surpassing USD 2,950. It's also up 22% in a week.
Other coins from the top 10 club are up 5%-13% in a day.
As reported today, some analysts argue that BTC and ETH may be bottoming or are soon to bottom – but with cautionary words attached against premature bullishness.
"The current rise came after considerable rangebound price action that saw volumes drying and shorts increasing. Typically when the market is heavily leaning on one side of a trade (too long or too short), the price can move to counter that weight and squeeze positions," Joe DiPasquale, CEO of crypto hedge fund BitBull Capital, wrote in an emailed comment.
According to him, in the last two years, risk-on equities and bitcoin have been positively correlated, but this was not the case overall previously.
"This week, the Nasdaq and S&P 500 have recovered where they were before Jan 21, the day BTC sold off from USD 43k to USD 35k. With equities’ partial recovery, all things being equal, we expected to see BTC back to USD 40-41k," DiPasquale added.
Meanwhile, this jump today is also attributed to recent positive developments in the stock market.
"The fact that AMZN’s earnings went the way of AAPL, MSFT and GOOGL -- and not the way of FB -- has given investors more confidence to reengage with the risk-on trade," Matt Maley, Chief Market Strategist at Miller Tabak + Co., told Bloomberg. Also, today was announced that the US economy created far more jobs than expected in January. Nonfarm payrolls increased by 467,000 jobs last month while economists polled by Reuters had forecast 150,000 jobs would be added in January.
Also, according to Hayden Hughes, CEO at Alpha Impact, a trading social media platform, although there were concerns about accelerating monetary policy, there is now a sense among many capital markets that a 50 basis point rate hike is priced in given recent movements in equity markets.
However, Will Hamilton, Head of Trading and Research at Trovio Capital Management, said that throughout this period of consolidation changes in the derivatives market indicate traders continuing to bet on further downside.
"Futures funding has remained in a sustained period of negativity indicating a modest short bias in the perpetuals market, whilst the bitcoin put/call ratio has hit 58%, a level last seen in the FY21 May-July bear market, indicating a strong desire for downside protection," he said in an emailed comment.
According to him, from an on-chain perspective, further accumulation is evident as new and existing investors continue to increase holdings.
"The number of new bitcoin wallets with a >0 zero balance has hit all-time high of 40.12m during this recent pullback whilst total exchange reserves have declined to multi-year lows, reaching 13.27% of the total circulating supply," Hamilton noted.
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Russian Government Set to Launch Bill that Calls Bitcoin & Crypto a Currency Analogue
The Russian cabinet has reportedly thrashed out an agreement with the Central Bank on the matter of cryptoassets. Widespread media reports from the likes of Kommersant, as well as Cnet claimed that the agreement would see a draft law rolled out by February 18.
Although the draft document will reportedly see a slew of tight restrictions imposed on crypto ownership and circulation – with crypto exchanges brought under a strict regulatory umbrella – the document is set to define crypto as a type of “currency analog,” instead of a “digital financial asset.”
However, although much of the international crypto community has been enthused by the news, there may cause for some degree of caution.
The development is a far cry, it would seem, from El Salvador’s decision to adopt bitcoin (BTC) as legal tender, for example.
Russian lawmakers have been deadlocked over the issue of crypto regulation for several years, chiefly because many forces in the government – particularly the Ministry of Finance – favor a more relaxed approach to regulation, while the Central Bank has repeatedly called for a blanket crypto ban.
This impasse has left the legal system in limbo, with politicians and judiciary members uncertain how crypto should be defined. Previous legal documents have made reference to crypto as a form of “intangible property” and vague terms like “digital assets” and “digital financial assets” have been used to define coins such as BTC.
Russian politicians and legal experts have agreed that these terms are lacking in clarity, and have urged the government to approve legally binding definitions for terms including “blockchain,” “cryptography,” “crypto mining” – as well as “cryptoassets.” As such, it appears that calling crypto a “currency analog” has more to do with legal-minded semantic gymnastics than any kind of bullish crypto adoption drive.
The cabinet’s agreement with the Central Bank may have been brought about after direct intervention from President Vladimir Putin, who earlier this year made reference to Russia’s crypto-related “resources” (namely a large amount of developers and ample surplus electricity). But Putin’s previous comments on crypto, while sometimes somewhat optimistic, have remained guarded.
And the regulatory framework reportedly agreed by the cabinet and the Central Bank may look eerily familiar for anyone who has studied the path taken by regulators in regions such as Europe and East Asia.
The draft bill will seek to stamp out anonymity in the crypto sector, by forcing crypto exchanges to fully identify their customers and their transactions via the domestic banking system and licensed financial intermediaries.
Individuals seeking to buy or sell crypto will have to “disclose their full names, phone number, passport details, as well as bank account details and email addresses” to banks, the media outlets reported.
If adopted, the bill would also seek to criminalize unreported crypto transactions worth over USD 8,000 and impose punitive fines on any firm or individual who accepts crypto as a form of payment.
Crypto payments were outlawed in what still remains Russia’s only piece of crypto legislation to date, but courts have been powerless to impose a strict form of punishment on anyone caught breaking this law.
The measures would force all crypto exchanges and brokerages to register with a central body – and would force all overseas trading platforms to either obtain operating permits or close down their Russian operations.
The Russian cabinet has reportedly thrashed out an agreement with the Central Bank on the matter of cryptoassets. Widespread media reports from the likes of Kommersant, as well as Cnet claimed that the agreement would see a draft law rolled out by February 18.
Although the draft document will reportedly see a slew of tight restrictions imposed on crypto ownership and circulation – with crypto exchanges brought under a strict regulatory umbrella – the document is set to define crypto as a type of “currency analog,” instead of a “digital financial asset.”
However, although much of the international crypto community has been enthused by the news, there may cause for some degree of caution.
The development is a far cry, it would seem, from El Salvador’s decision to adopt bitcoin (BTC) as legal tender, for example.
Russian lawmakers have been deadlocked over the issue of crypto regulation for several years, chiefly because many forces in the government – particularly the Ministry of Finance – favor a more relaxed approach to regulation, while the Central Bank has repeatedly called for a blanket crypto ban.
This impasse has left the legal system in limbo, with politicians and judiciary members uncertain how crypto should be defined. Previous legal documents have made reference to crypto as a form of “intangible property” and vague terms like “digital assets” and “digital financial assets” have been used to define coins such as BTC.
Russian politicians and legal experts have agreed that these terms are lacking in clarity, and have urged the government to approve legally binding definitions for terms including “blockchain,” “cryptography,” “crypto mining” – as well as “cryptoassets.” As such, it appears that calling crypto a “currency analog” has more to do with legal-minded semantic gymnastics than any kind of bullish crypto adoption drive.
The cabinet’s agreement with the Central Bank may have been brought about after direct intervention from President Vladimir Putin, who earlier this year made reference to Russia’s crypto-related “resources” (namely a large amount of developers and ample surplus electricity). But Putin’s previous comments on crypto, while sometimes somewhat optimistic, have remained guarded.
And the regulatory framework reportedly agreed by the cabinet and the Central Bank may look eerily familiar for anyone who has studied the path taken by regulators in regions such as Europe and East Asia.
The draft bill will seek to stamp out anonymity in the crypto sector, by forcing crypto exchanges to fully identify their customers and their transactions via the domestic banking system and licensed financial intermediaries.
Individuals seeking to buy or sell crypto will have to “disclose their full names, phone number, passport details, as well as bank account details and email addresses” to banks, the media outlets reported.
If adopted, the bill would also seek to criminalize unreported crypto transactions worth over USD 8,000 and impose punitive fines on any firm or individual who accepts crypto as a form of payment.
Crypto payments were outlawed in what still remains Russia’s only piece of crypto legislation to date, but courts have been powerless to impose a strict form of punishment on anyone caught breaking this law.
The measures would force all crypto exchanges and brokerages to register with a central body – and would force all overseas trading platforms to either obtain operating permits or close down their Russian operations.
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Official Winter Olympics P2E Game Is a Non-Starter in the Games’ Host Country
Crypto is making its presence felt through its absence at the Winter Olympics, currently underway in China. The International Olympic Committee (IOC) has struck a partnership deal with nWay, a subsidiary of the play-to-earn (P2E) gaming giant Animoca Brands, which has released the “official video game” of Beijing 2022. The snag? It’s banned in the Olympic host nation.
The game, which makes use of non-fungible tokens (NFTs) that can be used to customize avatars, is also a P2E title. It is named Olympic Games Jam: Beijing 2022.
The title sees players compete in a range of Winter Olympic sports, such as snowboarding, the skeleton and downhill skiing. They can collect Olympics-branded items and in-game items that can then be traded on the nWay marketplace.
But, the South Korean newspaper Chosun reported, China wants no part of it. The title is unavailable for download for the users of app marketplaces based in Mainland China – although that does not appear to have stopped some.
The report noted that players can expect to “often meet Chinese nationals” in the game’s virtual world, although it added that these were “presumable Chinese living abroad or bypassing domestic marketplaces by using a virtual private network (VPN).”
And China is not the only place where the game has hit roadblocks. South Korean gaming regulators also do not permit P2E titles to obtain licenses – although Chosun noted that the game can be downloaded via the Google Play store in South Korea.
At present, some developers have sought to release their titles directly to Google Play without even attempting to obtain an age-appropriate permit from the Game Rating and Administration Committee (GRAC). This loophole is set to close, however, as the GRAC has recently announced that it will begin asking the Google Play Store and other marketplaces to take down titles or block South Korea-based users from downloading unlicensed games.
The game was released on the Flow blockchain protocol, leading to a rise in the network’s native coin, flow (FLOW). At the time of writing, FLOW trades at USD 8.33 and is up 68% in two weeks, increasing its monthly gains to 10%.
Crypto is making its presence felt through its absence at the Winter Olympics, currently underway in China. The International Olympic Committee (IOC) has struck a partnership deal with nWay, a subsidiary of the play-to-earn (P2E) gaming giant Animoca Brands, which has released the “official video game” of Beijing 2022. The snag? It’s banned in the Olympic host nation.
The game, which makes use of non-fungible tokens (NFTs) that can be used to customize avatars, is also a P2E title. It is named Olympic Games Jam: Beijing 2022.
The title sees players compete in a range of Winter Olympic sports, such as snowboarding, the skeleton and downhill skiing. They can collect Olympics-branded items and in-game items that can then be traded on the nWay marketplace.
But, the South Korean newspaper Chosun reported, China wants no part of it. The title is unavailable for download for the users of app marketplaces based in Mainland China – although that does not appear to have stopped some.
The report noted that players can expect to “often meet Chinese nationals” in the game’s virtual world, although it added that these were “presumable Chinese living abroad or bypassing domestic marketplaces by using a virtual private network (VPN).”
And China is not the only place where the game has hit roadblocks. South Korean gaming regulators also do not permit P2E titles to obtain licenses – although Chosun noted that the game can be downloaded via the Google Play store in South Korea.
At present, some developers have sought to release their titles directly to Google Play without even attempting to obtain an age-appropriate permit from the Game Rating and Administration Committee (GRAC). This loophole is set to close, however, as the GRAC has recently announced that it will begin asking the Google Play Store and other marketplaces to take down titles or block South Korea-based users from downloading unlicensed games.
The game was released on the Flow blockchain protocol, leading to a rise in the network’s native coin, flow (FLOW). At the time of writing, FLOW trades at USD 8.33 and is up 68% in two weeks, increasing its monthly gains to 10%.
Crypto Market Braces for Volatile Week Ahead of Fed’s ‘Emergency Meeting
The US Federal Reserve (Fed) is set to hold an unscheduled meeting on Monday to discuss interest rates, described by some as an “emergency meeting” and others as a fairly “regular occurrence.” Regardless, the Fed’s unexpected notice has sparked debate in the crypto community over whether the central bank will announce a rate hike -- and if so, how high, and how many of them there will be this year.
The unscheduled meeting, which the Fed said will be held under “expedited procedures,” is set for Monday at 11:30 EST (16:30 UTC). And according to the Fed’s public notice, interest rates is the only item on the agenda.
The notice has led to a flurry of speculation in the crypto community about what the Fed is planning to do, given the market’s expectation that the first rate hike from the Fed would not come before mid-March.
Notably, the unscheduled meeting did not come as a complete surprise for some, with for instance Sven Henrich, the founder of trading and analysis website NorthmanTrader, saying ahead of time that the best thing the Fed can do to restore credibility is “a surprise rate hike before the next Fed meeting.”
“Rate hike next week,” Henrich followed up by asking once the meeting was announced yesterday.
“The Fed is calling an emergency meeting for Monday” and is “sweating bullets” over last month’s 7.5% inflation, said the popular bitcoin (BTC) advocate and podcast host Marty Bent. He added that he believes the central bank will raise rates before its next scheduled meeting in March.
The US Federal Reserve (Fed) is set to hold an unscheduled meeting on Monday to discuss interest rates, described by some as an “emergency meeting” and others as a fairly “regular occurrence.” Regardless, the Fed’s unexpected notice has sparked debate in the crypto community over whether the central bank will announce a rate hike -- and if so, how high, and how many of them there will be this year.
The unscheduled meeting, which the Fed said will be held under “expedited procedures,” is set for Monday at 11:30 EST (16:30 UTC). And according to the Fed’s public notice, interest rates is the only item on the agenda.
The notice has led to a flurry of speculation in the crypto community about what the Fed is planning to do, given the market’s expectation that the first rate hike from the Fed would not come before mid-March.
Notably, the unscheduled meeting did not come as a complete surprise for some, with for instance Sven Henrich, the founder of trading and analysis website NorthmanTrader, saying ahead of time that the best thing the Fed can do to restore credibility is “a surprise rate hike before the next Fed meeting.”
“Rate hike next week,” Henrich followed up by asking once the meeting was announced yesterday.
“The Fed is calling an emergency meeting for Monday” and is “sweating bullets” over last month’s 7.5% inflation, said the popular bitcoin (BTC) advocate and podcast host Marty Bent. He added that he believes the central bank will raise rates before its next scheduled meeting in March.
NYSE 'Coming to Metaverse', Files NFT-Related Trademark Application
The New York Stock Exchange (NYSE), the world’s largest stock exchange, has filed a trademark application with the United States Patent and Trademark Office (USPTO) to register the term “NYSE” for an array of metaverse- and non-fungible token (NFT)-related products.
Trademark attorney Michael Kondoudis initially revealed the application, saying that the NYSE "is coming to the Metaverse."
The application suggests plans "to trademark NYSE for NFTs, cryptocurrencies, digital collectibles, and marketplaces to trade and exchange them," Kondoudis wrote.
Filed on February 10, the new trademark application suggests the NYSE intends to provide an online marketplace for buyers, sellers, and traders of "downloadable virtual goods," namely, NFTs and NFT collectible series, digital collectibles, digital tokens, and digital art.
The filing also lists "virtual reality" software, and software for digital, virtual, and cryptocurrency wallets and storage.
It further includes "software and application programming interface (API) for sending, receiving, accepting, buying, selling, storing, transmitting, trading and exchanging digital currency, virtual currency, cryptocurrency, digital and blockchain assets."
In another section, the trademark includes "cryptocurrency trading services" that would facilitate the "financial exchange of virtual currency."
Notably, this is not the American stock exchange's first foray into NFTs. In early 2021, the NYSE minted NFTs of the first trade made in the shares of six prominent US companies, including Spotify, Snowflake, Unity, DoorDash, Roblox, and Coupang.
Meanwhile, as reported, American fast-food behemoth McDonald’s filed 11 trademark applications earlier this month that make direct references to virtual restaurants, cafes, concerts, and other virtual services, goods, and events. Prior to that, Walmart and Crocs had filed trademark applications suggesting that they aim to offer virtual goods, digital assets, and NFTs.
The New York Stock Exchange (NYSE), the world’s largest stock exchange, has filed a trademark application with the United States Patent and Trademark Office (USPTO) to register the term “NYSE” for an array of metaverse- and non-fungible token (NFT)-related products.
Trademark attorney Michael Kondoudis initially revealed the application, saying that the NYSE "is coming to the Metaverse."
The application suggests plans "to trademark NYSE for NFTs, cryptocurrencies, digital collectibles, and marketplaces to trade and exchange them," Kondoudis wrote.
Filed on February 10, the new trademark application suggests the NYSE intends to provide an online marketplace for buyers, sellers, and traders of "downloadable virtual goods," namely, NFTs and NFT collectible series, digital collectibles, digital tokens, and digital art.
The filing also lists "virtual reality" software, and software for digital, virtual, and cryptocurrency wallets and storage.
It further includes "software and application programming interface (API) for sending, receiving, accepting, buying, selling, storing, transmitting, trading and exchanging digital currency, virtual currency, cryptocurrency, digital and blockchain assets."
In another section, the trademark includes "cryptocurrency trading services" that would facilitate the "financial exchange of virtual currency."
Notably, this is not the American stock exchange's first foray into NFTs. In early 2021, the NYSE minted NFTs of the first trade made in the shares of six prominent US companies, including Spotify, Snowflake, Unity, DoorDash, Roblox, and Coupang.
Meanwhile, as reported, American fast-food behemoth McDonald’s filed 11 trademark applications earlier this month that make direct references to virtual restaurants, cafes, concerts, and other virtual services, goods, and events. Prior to that, Walmart and Crocs had filed trademark applications suggesting that they aim to offer virtual goods, digital assets, and NFTs.
Correlation Between Bitcoin and Traditional Markets Might Break This Spring - Pantera
The correlation between traditional macro assets and digital assets that has been seen in recent months could soon break, with what assets in the decentralized finance (DeFi) space possibly leading the way higher, executives at the crypto hedge fund Pantera Capital said in a recent call with investors.
In the call, which took place on February 1, Pantera Capital CEO Dan Morehead and the firm’s co-chief investment officer Joey Krug both said they believe the crypto market is ready to “decouple” from traditional macro assets, even in the face of higher interest rates.
The details from the call were shared in Pantera’s latest Blockchain Letter from Wednesday this week.
According to Krug, history has shown that when traditional macro assets go down, crypto tends to be correlated for a period of about 70 days before the correlation starts to break. “And so we think over the next number of weeks, crypto is basically going to decouple from traditional markets and begin to trade on its own again,” Krug said, before adding a word of caution:
“It doesn't guarantee that it won't go down a lot more next month, or whenever, but it just means the odds are really high that the markets are at an extreme and will bounce back relatively quickly.”
In February 2021, when BTC traded at around USD 47,000 after correcting around 20% in a week, Krug predicted that a BTC rally might be back "by April, if not sooner." Since then, the price rallied to over USD 63,000 in mid-April before starting a strong downturn that brought BTC below USD 30,000 in July.
This time, Krug further explained that he does not believe digital asset are trading at overly high valuations at the moment, with for instance many DeFi assets trading at P/E multiples from 10 to 40. “They’re not crazy high-valued; tech stocks are trading at multiples of 400 to 500x,” Krug said.
The price-to-earnings (P/E) ratio is a metric often used to value stocks, and can be found by dividing the market price per share (or token) of a company (or protocol) by its earnings per share.
“It's my personal view that USD 2,200 ETH was likely the bottom,” Krug added.
Pantera’s CEO Dan Morehead also concurred, saying that other assets such as stocks and real estate have cash flows that need to be discounted. “… this implies lower prices if yields are higher,” he explained.
For crypto, however, Morehead said that it is “like gold,” and that it must be valued differently.
“It can behave in a very different way from interest-rate-oriented products. I think when all's said and done, investors will be given a choice: they have to invest in something, and if rates are rising, blockchain is going to be the most relatively attractive,” the Pantera CEO said.
Meanwhile, a possible divergence between traditional assets like stocks and crypto was also pointed to by Bloomberg Intelligence’s Senior Commodity Analyst Mike McGlone. Commenting on Twitter today, McGlone said that elevated inflation, as well as tensions around Ukraine and Russia, could offer “a firm foundation” for bitcoin (BTC), ethereum, and other digital assets in 2022.
The correlation between traditional macro assets and digital assets that has been seen in recent months could soon break, with what assets in the decentralized finance (DeFi) space possibly leading the way higher, executives at the crypto hedge fund Pantera Capital said in a recent call with investors.
In the call, which took place on February 1, Pantera Capital CEO Dan Morehead and the firm’s co-chief investment officer Joey Krug both said they believe the crypto market is ready to “decouple” from traditional macro assets, even in the face of higher interest rates.
The details from the call were shared in Pantera’s latest Blockchain Letter from Wednesday this week.
According to Krug, history has shown that when traditional macro assets go down, crypto tends to be correlated for a period of about 70 days before the correlation starts to break. “And so we think over the next number of weeks, crypto is basically going to decouple from traditional markets and begin to trade on its own again,” Krug said, before adding a word of caution:
“It doesn't guarantee that it won't go down a lot more next month, or whenever, but it just means the odds are really high that the markets are at an extreme and will bounce back relatively quickly.”
In February 2021, when BTC traded at around USD 47,000 after correcting around 20% in a week, Krug predicted that a BTC rally might be back "by April, if not sooner." Since then, the price rallied to over USD 63,000 in mid-April before starting a strong downturn that brought BTC below USD 30,000 in July.
This time, Krug further explained that he does not believe digital asset are trading at overly high valuations at the moment, with for instance many DeFi assets trading at P/E multiples from 10 to 40. “They’re not crazy high-valued; tech stocks are trading at multiples of 400 to 500x,” Krug said.
The price-to-earnings (P/E) ratio is a metric often used to value stocks, and can be found by dividing the market price per share (or token) of a company (or protocol) by its earnings per share.
“It's my personal view that USD 2,200 ETH was likely the bottom,” Krug added.
Pantera’s CEO Dan Morehead also concurred, saying that other assets such as stocks and real estate have cash flows that need to be discounted. “… this implies lower prices if yields are higher,” he explained.
For crypto, however, Morehead said that it is “like gold,” and that it must be valued differently.
“It can behave in a very different way from interest-rate-oriented products. I think when all's said and done, investors will be given a choice: they have to invest in something, and if rates are rising, blockchain is going to be the most relatively attractive,” the Pantera CEO said.
Meanwhile, a possible divergence between traditional assets like stocks and crypto was also pointed to by Bloomberg Intelligence’s Senior Commodity Analyst Mike McGlone. Commenting on Twitter today, McGlone said that elevated inflation, as well as tensions around Ukraine and Russia, could offer “a firm foundation” for bitcoin (BTC), ethereum, and other digital assets in 2022.
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DeFi Kingdoms Surpassed Axie Infinity in Transactions in January
Play-to-earn game DeFi Kingdoms generated some USD 1.84bn in transactions in January 2022, more than tripling the value posted by rival game dapp Axie Infinity (AXS), according to dapp information provider DappRadar.
Built on the Harmony (ONE) blockchain, DeFi Kingdoms held USD 775m, or 64.6%, of the blockchain’s total value locked (TVL) last month, the analysts said in a new report.
DappRadar calls DeFi Kingdoms the perfect example of GameFi, the gamification of decentralized finance (DeFi) in which “games naturally incorporate DeFi features into their playing mechanics." It says that "DFK takes GameFi one step beyond by creating an authentic gaming experience within its pixelated virtual world,” accommodating transactions in JEWEL, the game’s utility and governance token.
Owing to its features, DeFi Kingdoms has established itself as the essential dapp for the rising Harmony ecosystem, with a TVL of some USD 1.2bn, attracting more than 22,000 daily unique active wallets (UAWs) in January, and retaining its player base at the level from December 2021, according to data from the report.
At the same time, DeFi Kingdoms generated about USD 1.84bn in transactions last month, three times more than Axie Infinity which was ranked second, with a USD 540m stake representing 11.1% of the total. This allowed DeFi Kingdoms to capture some 38.2% of the January volume transacted by blockchain games which stood at a total of USD 4.82bn that month, as indicated by DappRadar. (Note: In a different place in the report, DappRadar said that DeFi Kingdoms generated USD 1.6bn (38%), in January game dapp transactions.
Play-to-earn game DeFi Kingdoms generated some USD 1.84bn in transactions in January 2022, more than tripling the value posted by rival game dapp Axie Infinity (AXS), according to dapp information provider DappRadar.
Built on the Harmony (ONE) blockchain, DeFi Kingdoms held USD 775m, or 64.6%, of the blockchain’s total value locked (TVL) last month, the analysts said in a new report.
DappRadar calls DeFi Kingdoms the perfect example of GameFi, the gamification of decentralized finance (DeFi) in which “games naturally incorporate DeFi features into their playing mechanics." It says that "DFK takes GameFi one step beyond by creating an authentic gaming experience within its pixelated virtual world,” accommodating transactions in JEWEL, the game’s utility and governance token.
Owing to its features, DeFi Kingdoms has established itself as the essential dapp for the rising Harmony ecosystem, with a TVL of some USD 1.2bn, attracting more than 22,000 daily unique active wallets (UAWs) in January, and retaining its player base at the level from December 2021, according to data from the report.
At the same time, DeFi Kingdoms generated about USD 1.84bn in transactions last month, three times more than Axie Infinity which was ranked second, with a USD 540m stake representing 11.1% of the total. This allowed DeFi Kingdoms to capture some 38.2% of the January volume transacted by blockchain games which stood at a total of USD 4.82bn that month, as indicated by DappRadar. (Note: In a different place in the report, DappRadar said that DeFi Kingdoms generated USD 1.6bn (38%), in January game dapp transactions.
First Syndicated Loan for Alameda Research Surpasses USD 100M
Maple Finance, an institutional capital marketplace focused on crypto, has issued its first syndicated loan in excess of USD 100m to Alameda Research, a quantitative trading firm and parent company of crypto derivatives exchange FTX.
According to an announcement from Maple Finance, the loan to Alameda was made possible after the crypto lending and borrowing firm Abra deposited USD 25m into Alameda’s pool on the platform.
Abra was joined by several other lenders, including CoinShares, ZedRun, and others, bringing the total deposits to more than USD 100m.
Alameda Research plans to use the loan, which will be issued in the stablecoin USD coin (USDC), to facilitate its market-making business, the announcement added.
“Against a backdrop of market uncertainty, Maple is seeing increasing institutional demand for uncollateralized lending opportunities,” Sidney Powell, CEO and co-founder of Maple Finance told Cryptonews.com in an emailed comment.
Powell added that many institutional investors, corporate treasuries, and decentralized autonomous organizations (DAOs) are looking for stable yields, and that, therefore, the decentralized finance (DeFi) lending market will grow “significantly” in 2022.
Currently run by the two co-CEOs Caroline Ellison and Sam Trabucco, Alameda Research employs both arbitrage and quantitative trading strategies across the cryptoasset market, in addition to acting as a market maker on several exchanges, according to its website.
According to Maple Finance, Alameda’s pool, which launched in November last year, marks the first syndicated loan in DeFi, where several lenders get together to provide funds for a single borrower.
Launched 9 months ago and focused on offering uncollateralized loans to institutional customers, Maple Finance has reached a total value locked (TVL) of USD 644.18m. The target for the Alameda pool on the platform is USD 1bn in loans originated this year, with Maple Finance seeking to hit an overall TVL of USD 5bn by the end of the year, the firm said.
“In an otherwise bearish market, firms are deploying liquidity where yields are stable and sustainable,” Maple Finance said in its announcement. It added that the growing institutional participation on its platform “demonstrates the attractiveness of DeFi lending opportunities.”
The announcement from Maple Finance follows a report last week from crypto derivatives exchange BitMEX where it predicted that the demand for high-yield crypto savings products will surge this year, given a lack of yield elsewhere.
Maple Finance, an institutional capital marketplace focused on crypto, has issued its first syndicated loan in excess of USD 100m to Alameda Research, a quantitative trading firm and parent company of crypto derivatives exchange FTX.
According to an announcement from Maple Finance, the loan to Alameda was made possible after the crypto lending and borrowing firm Abra deposited USD 25m into Alameda’s pool on the platform.
Abra was joined by several other lenders, including CoinShares, ZedRun, and others, bringing the total deposits to more than USD 100m.
Alameda Research plans to use the loan, which will be issued in the stablecoin USD coin (USDC), to facilitate its market-making business, the announcement added.
“Against a backdrop of market uncertainty, Maple is seeing increasing institutional demand for uncollateralized lending opportunities,” Sidney Powell, CEO and co-founder of Maple Finance told Cryptonews.com in an emailed comment.
Powell added that many institutional investors, corporate treasuries, and decentralized autonomous organizations (DAOs) are looking for stable yields, and that, therefore, the decentralized finance (DeFi) lending market will grow “significantly” in 2022.
Currently run by the two co-CEOs Caroline Ellison and Sam Trabucco, Alameda Research employs both arbitrage and quantitative trading strategies across the cryptoasset market, in addition to acting as a market maker on several exchanges, according to its website.
According to Maple Finance, Alameda’s pool, which launched in November last year, marks the first syndicated loan in DeFi, where several lenders get together to provide funds for a single borrower.
Launched 9 months ago and focused on offering uncollateralized loans to institutional customers, Maple Finance has reached a total value locked (TVL) of USD 644.18m. The target for the Alameda pool on the platform is USD 1bn in loans originated this year, with Maple Finance seeking to hit an overall TVL of USD 5bn by the end of the year, the firm said.
“In an otherwise bearish market, firms are deploying liquidity where yields are stable and sustainable,” Maple Finance said in its announcement. It added that the growing institutional participation on its platform “demonstrates the attractiveness of DeFi lending opportunities.”
The announcement from Maple Finance follows a report last week from crypto derivatives exchange BitMEX where it predicted that the demand for high-yield crypto savings products will surge this year, given a lack of yield elsewhere.
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