The biggest crypto news and ideas of the day |
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Bitcoin Slides on Low Volatility |
Bitcoin (BTC) tumbled below $62,000 during U.S. morning trading Tuesday as the crypto market halted its bounce from early August lows. The largest crypto fell to as low as $61,500, now down more than 5% since its swift rally to $65,000 following Federal Reserve Chair Jerome Powell's dovish speech at Jackson Hole on Friday. It's down 3% through the past 24 hours. The weak action spread to the wider market, with the broad-based CoinDesk 20 Index down 2.8% during the same period. Ethereum's ether (ETH) continued its losing streak against BTC, falling more than 5% below $2,600 and dragging the ETH/BTC ratio to its lowest level in more than three years. Altcoin majors also suffered losses, with the native cryptocurrencies of Avalanche (AVAX), Chainlink (LINK) and Uniswap (UNI) leading with 4%-7% declines. |
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BTC Miner Invests in Bitcoin |
Billionaire Michael Saylor famously pioneered large-scale corporate purchases of bitcoin (BTC), using borrowed money to turn his publicly traded software developer MicroStrategy (MSTR) into one of the world's largest holders of the cryptocurrency. Now, another company – a surprising one – is following a similar strategy. It's a bitcoin miner, a company that can theoretically snag discounted BTC through mining. The fact that it's following Saylor's playbook, selling debt to fund bitcoin purchases, not using that borrowed money to buy equipment to mine more coins, puts a spotlight on how tough the mining sector has gotten this year. The miner is Marathon Digital (MARA), which this month sold $300 million of convertible notes, or bonds that can be turned into stock, and purchased 4,144 bitcoin with most of the proceeds. Rather than purchase more mining rigs, "given the current mining hash price, the internal rate of return (IRR) indicates that purchasing bitcoin using funds from debt or equity issuances is more beneficial to shareholders until conditions improve," the largest publicly traded miner posted recently on X. "Hash price" is a measure of mining profitability. MicroStrategy's bitcoin accumulation strategy was widely criticized when prices crashed in 2022, putting the company's stake underwater. No one is laughing now, given MicroStrategy's bitcoin hoard is worth billions more than the company paid. |
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Telegram Founder Out by October? |
Telegram CEO Pavel Durov could be free to go as soon as Wednesday local time, French prosecutors said. However, Polymarket isn't confident he'll be released in August, with bettors putting money on a release before the end of September. Durov has not yet been formally charged, prosecutors said. Instead, he is being held as part of an investigation that stems as a result of crimes allegedly planned or broadcasted on Telegram, including money laundering, drug trafficking, child pornography, and non-cooperation with law enforcement. Bettors say there's a 72% chance he'll be out before October, with shares of the yes side trading at 72 cents. Each share pays out $1 in USDC, a stablecoin, if the prediction comes true, and $0 if it does not. As Durov was arrested on Saturday, August 24, 2024, at 8:00 PM local time when his plane landed at Le Bourget airport, a general aviation airport north of Paris, he could be held until Wednesday, August 28, 2024, at 8:00 PM, but bettors have their money on an extended stay. |
Former President Donald Trump is out with another collection of digital trading card non-fungible tokens (NFTs), which were once a lucrative business line for the Republican nominee. This time around, Trump’s fourth collection will offer high-rollers a piece of the candidate’s suit from his debate with President Joe Biden, according to a post on social media platform Truth Social. People who spend $24,750 on the cards will also get access to Trump sneakers, Trump cocktails and dinner at Trump National Golf Club in Jupiter, Florida, with Trump. It was at a May gala, celebrating collectors of the third NFT set, that Trump pushed crypto into the political spotlight with the declaration that he would be the industry’s champion in the White House — and that the Democrats its ruin. Trump continued to build his crypto-politics persona with a speech at the Bitcoin conference in Nashville and pro-Bitcoin language on the Republican Party platform. The industry’s biggest players have rewarded his turnabout (he had previously lambasted Bitcoin as a scam) with mountains of campaign cash. But the money raised by Trump’s NFT collection is separate from his political war chest and goes to his personal coffers. In his most recent financial disclosures, Trump revealed that his NFT businesses had netted him well over a million dollars in crypto. |
The Takeaway: Durov, Free Speech Hero |
By Ben Schiller Over the weekend, Telegram founder Pavel Durov was arrested at a Paris airport and later charged by the Tribunal Judiciaire De Paris with enabling illegal transactions, distributing child abuse material, complicity in the drug trade, and failing to cooperate with law enforcement. This is clearly a big moment. Here is an enormously powerful social media CEO (Telegram has roughly one billion users) struggling with the very conspicuous long arm of the nation-state. Durov fits a recent pattern of governments re-asserting authority over networks that founders, and many of the rest of us, conceive of as free-speech havens (common spaces) that officials have little right to touch. Durov’s arrest has generated a lot of conjecture, debate, conspiracy-theorizing and culture war rhetoric in the last 48 hours. Durov’s case is a revealing flashpoint in the free speech wars of the modern internet and the larger question of whether we, as digital citizens, can expect public commons where we can speak freely without interference from what are, in effect, censors. On one side are the free speech advocates, including X (formerly Twitter) boss Elon Musk, who argue that Durov’s case amounts to a crackdown on open discourse. Musk has started a #FreePavel campaign and brought many millions in crypto with him. Interestingly, Mark Zuckerberg chose this exact moment to highlight how the U.S. leaned on Meta during the COVID pandemic to strip "disinformation," seemingly showing solidarity with Durov’s struggles in Paris. Durov has become a hero in the eyes of those who champion an internet free of mediation, including those in cryptocurrency, even if that freedom leads to people using that network for all kinds of morally problematic and even illegal things. But Telegram, which is the channel of choice for nearly everyone in Web3, is not exactly the encrypted nirvana we might want, ideally. As tech journalist Casey Newton explains: “Telegram is often described as an 'encrypted' messenger. But as Ben Thompson explains today, Telegram is not end-to-end encrypted, as rivals WhatsApp and Signal are. (Its 'secret chat' feature is end-to-end encrypted, but it is not enabled on chats by default. The vast majority of chats on Telegram are not secret chats.) That means Telegram can look at the contents of private messages, making it vulnerable to law enforcement requests for that data.” Durov has often presented Telegram as a “secure messenger,” but outside of its secret chat function, the service is more open to government intrusion than Signal, WhatsApp and iMessage. Telegram is not Bitcoin, where transactions are unstoppable. It’s not a blockchain, which accords privacy in a different way from something like Telegram, which, structurally, is both a free speech haven and a honeypot for intermediaries, whether criminal or governmental. The beauty of blockchains is we don’t have to debate the motivations and machinations of men like Elon Musk, Pavel Durov, and Mark Zuckerberg. The freedom of expression is baked into the code. The free-speech principles at play in Durov’s case should clearly have the crypto community's support. But ideally we would have public online commons that are genuinely free from government intrusion and the whims of single men, however well-meaning.
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