Can Square Green the Orange Coin?

December 8, 2020

The top stories in bitcoin, crypto and more – all in one place, delivered daily

Sponsored By:

By Daniel Kuhn

If you were forwarded this newsletter and would like to receive it, sign up here.

Top shelf

Square will invest in environmentally conscious bitcoin tech. Spain's second-largest bank is reportedly planning a leap into the digital asset industry. And large crypto funds topped a combined $15 billion AUM, as markets trade sideways.

Greening the orangecoin

Square has announced the launch of a Bitcoin Clean Energy Investment Initiative, where it has committed $10 million to support companies working on green energy technologies within the bitcoin mining sector. Announced Tuesday, the company said it aims to become a net-zero carbon contributor for operations by 2030 and wants to help drive the adoption and efficiency of renewables within the bitcoin ecosystem. “We believe that cryptocurrency will eventually be powered completely by clean power, eliminating its carbon footprint and driving adoption of renewables globally," said Square and Twitter CEO Jack Dorsey. "

Spain's second-largest
BBVA, the second-largest bank in Spain, with about $840 billion in assets, is planning a crypto industry entrance by way of Switzerland, according to two sources. BBVA would not comment, but is said to be “launching its Europe-wide crypto initiative from Switzerland,” according to a close source. “There are still some compliance hurdles, but I expect [BBVA] will be live next month,” they said. BBVA is rumored to have integrated a digital asset custody solution, called SILO, and was among the first financial institutions to experiment with public and private blockchains in 2018.

Qualified investors?
Alternative investment intermediary Vincent is seeing record interest in crypto as it launches out of beta. Between October and November, “investors looking for digital assets have grown 80%,” said Vincent co-founder Slava Rubin. Built by the team behind Indiegogo, Vincent is a kind of investment search engine, where qualified investors can browse for opportunities – actual fundraising occurs on regulated partner platforms – like regulated crypto deals from Grayscale, Republic and Cadence, among other non-crypto businesses. “Considering digital assets today represent less than 10% of the total available deal volume on Vincent, there is significant room to grow,” Rubin said. (Grayscale is a sister company to CoinDesk.)

$15B AUM
Large crypto funds are riding high, with an estimated $15 billion in assets under management (AUM), an all-time high, according to CoinShare’s data. By comparison, there was $2.57 billion in AUM at the close of 2019. CoinShares, a digital asset manager, told Reuters on Monday that large-scale cryptocurrency funds saw an inflow of $429 million last week alone. The largest-ever weekly inflow was $468 million seen three weeks ago.

Ethereum, Nervos?
Huobi, one of the “Big Three” Chinese exchanges, is tapping the public Nervos blockchain for its dollar-pegged stablecoin, HUSD, issued by Huobi-backed Stable Universal Limited. This is the first dollar-pegged stablecoin to go live on Nervos, which is sometimes called China’s answer to Ethereum. Currently, HUSD is an ERC-20 token based on the Ethereum blockchain that has its dollars in reserve by Paxos Trust Company. With this integration, it will also be on the Nervos blockchain through the sUDT technical standard, a native token standard launched by Nervos to compete with Ethereum’s ERC-20.

Privacy inoculation
Blockchain-based “immunity passports” don’t resolve core privacy concerns, according to new research from Harry Halpin. “Identity systems based on globally unique identifiers are by nature against privacy, and putting them on a blockchain does not change this fundamental dichotomy,” said Halpin, the author of the paper “Vision: A Critique of Immunity Passports and W3C Decentralized Identifiers” and the CEO of NYM, a privacy startup developing a mixnet. “In fact, putting this data on a blockchain tends to make privacy problems worse, and it’s not clear that hand-waving about zero-knowledge proofs really changes the situation.”

SPONSORED BY HYPERLEDGER

Hyperledger is an open-source project created to advance enterprise blockchain technologies. Register for a panel to celebrate the fifth anniversary this month.

Quick bites

Looking Back, Moving Forward: Crypto’s Most Influential in 2020

Each year since 2014, CoinDesk has identified the crypto community's “most influential” members. The community needed influencers to spread awareness, build confidence and set precedents for the digital currency industry to reach its full potential.

These evangelists broke through all the white noise and ushered in a new wave of enthusiasts into the space. To recognize their contributions, CoinDesk launched its “Most Influential” franchise to highlight individuals who moved the needle.

Over two days, Dec. 7-8, a special CoinDesk Live series looks back to the first list and takes stock of the industry’s progress, and zooms forward to reveal CoinDesks' seventh Most Influential list to recognize the latest pioneers who helped take the industry forward.

Watch CoinDesk Live: Most Influential 2020 on CoinDesk.com, YouTube and Twitter, Dec. 7-8.

Market intel

Deja vu – 2017?
Bitcoin is facing selling pressure on Tuesday. The leading cryptocurrency dropped below $19,000, a more than 2% decline on the day, according to CoinDesk 20 data. The decline comes after multiple rejections near $19,400 in the past 48 hours, CoinDesk’s Omkar Godbole reports. Large sell orders were placed around the all-time high of $19,920, capping the upside, as traders look poised to liquidate their holdings. For instance, the balance held in “accumulation addresses,” i.e., large bags, has declined by over 4% to 2,698,719 bitcoin in the past three weeks, according to data source Glassnode.

Monthly review

The latest CoinDesk Monthly Review compares bitcoin’s November 2020 rally with the asset’s market and network performance three years ago, and looks at some metrics on the progress toward the launch of Ethereum 2.0. Download the free CoinDesk Research November 2020 Review.

At stake

Squaring the circle?

In the period before President-elect Joe Biden takes office, several Democrat lawmakers have come out swinging against favorable, crypto-focused guidance issued under the Trump administration.

Most notably is the Stablecoin Tethering and Bank Licensing Enforcement (STABLE) Act, introduced by U.S. Representatives Rashida Tlaib (D-Mich.), Jesús “Chuy” García (D-Ill.) and Stephen Lynch (D-Mass.) last week.

The bill, if passed, would essentially treat stablecoin issuers as deposit holders and therefore be subject to certain banking regulations. As Blockchain Bites reported earlier, much of the crypto community has come out against the proposed legislation – with many saying it fails to understand the nature of decentralized, programmable money and would hinder the growth of an emergent industry.

It’s a bit of a black box how a President Biden will run his administration, especially regarding financial matters. While campaigned he told rich donors, i.e., Wall Street, “nothing would fundamentally change" if he's elected. And he has gone on to nominate or float financially lenient regulators, such as Janet Yellen, for cabinet positions.

Yellen is on record as saying she believes the U.S. financial regulators should allow blockchain and cryptocurrency projects to develop, saying in 2015 the Federal Reserve and other regulators might have “limited authority” over digital currency systems.

That said, Circle CEO Jeremy Allaire believes the incoming administration will “ultimately be supportive of cryptocurrency because it represents a seismic shift as large as the commercial internet.” Allaire’s Circle is part of the CENTRE consortium that oversees the USDC stablecoin.

The Biden administration is “going to be focused on infrastructure changes that make America more competitive, and this is absolutely going to be a core building block in that,” Allaire said on CNBC. He did not comment on the STABLE Act directly, but noted there are moderates in office that believe in constructive approaches to regulation.

If the economy is the biggest story in this election cycle, the growing crypto dollar sector – now over $20 billion – is hard to ignore.

Who won #CryptoTwitter?

ATTENTION: Scammers have been sending fraudulent emails with links to sites disguised to look like coindesk.com. If you are in doubt about a link, type https://www.coindesk.com directly into your browser; do not copy and paste. Remember, if something seems too good to be true, it probably is.

Blockchain Bites

A newsletter from CoinDesk

See Previous Editions

Copyright © 2020 CoinDesk, All rights reserved.

250 Park Avenue South New York, NY 10003, USA

You can manage your preferences here or unsubscribe from all CoinDesk email.