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TOP SHELF
Halving Predictions: Mining & Price
Hut 8, one of the largest publicly listed mining companies, is likely to be affected by the incoming bitcoin halving event. The firm’s profitability has declined over several quarters, its mining rigs are struggling to compete and it carries a heavy load of fixed interest debt. CoinDesk Research takes an in-depth look into Hut 8’s financials and risks in a free report, available for download here.
Meanwhile, mining manufacturer Bitmain is said to have booked over $300 million in revenue year-to-date. (The Block) Still, the firm has already begun marking down the prices of its machines ahead of the halving event.
Bitcoin's third halving, less than two weeks away, is often touted as a catalyst for a price surge. It’s certainly led to a surge in interest and speculation around the cryptocurrency. Yet, some traders think the halving will be negligible compared with other macro-level events like unprecedented central bank monetary policies as well as the everyday trading levels on exchanges.
However, believers in Bitcoin’s stock-to-flow model are predicting a bullish run after the halving. This esoteric economic model tracks a commodity’s existing supply against how quickly new stock enters the market. “This hypothesis … is that scarcity, as measured by S2F, directly drives value,” PlanB reportedly said. Decrypt’s Colin Harper takes a look at the theory.
Forbes also weighs in on the debate, with contributor Luke Fitzpatrick predicting “a new class of crypto millionaires may emerge.” (Forbes)
Admonishin' Mnuchin In a letter addressed to Treasury Secretary Steven Mnuchin, 11 members of Congress, suggest blockchain and other distributed technologies could boost liquidity and help distribute federal stimuli during the COVID-19 crisis. “Such steps will ensure both that America retains its technological advantage and that relief is delivered quickly to the small businesses and individuals who need it most,” the letter reads.
Silver Linings? Silvergate Bank added 46 crypto customers in the first quarter and saw fee income and deposits increase from its existing client base. COVID-19-led market volatility is cited by the bank as cause for an increase in deposits, according to the company’s earnings report.
Nasdaq Taps Corda The Nasdaq stock exchange has partnered with R3 to offer a platform for digital asset marketplaces on the Corda blockchain. As of today, capital markets participants can use Corda to support the issuance, trading, settlement and custody of digital assets.
Skew & Kyte Skew, a crypto derivatives data aggregator, has launched a trade execution platform and raised $5 million to help build out its new brokerage services. Partnering with UK-based Kyte Broking, skewTrading is focused on attracting institutional investors.
Stop, Stop. Stuttgart To Be Kidding Me The bitcoin exchange arm of Boerse Stuttgart has added a “stop order” trading function to help customers deal with volatile market conditions. Stop orders help people automate aspects of their trading strategy and, rather than having to watch the market 24/7, let them establish points at which they want to buy or sell.
Lnurl Something New Everyday A new standard known as Lnurl is attempting to improve the user experience of Lightning, Bitcoin’s scaling layer. Lnurl aims to simplify Lightning transactions to just a click or a QR scan. Zap, Phoenix, Breez, Blue Wallet and Wallet of Satoshi, as well as dozens of other apps, have quietly integrated the standard.
Surveilling Drones The U.S. Department of Transportation has issued a report advocating for blockchain to track the use of commercial drones. The distributed technology can be “used by stakeholders in the commercial drone industry, as it can ensure security and provide for identity management as well as providing a supporting role in aircraft traffic management, [drones] conflict management and flight authorization," according to the report.
Regulatory Shifts
The New York Department of Financial Services has appointed Richard Weber, former chief of the Criminal Investigation Division of the Internal Revenue Service, as its new general counsel. Weber led the IRS division during the agency's investigation into the Silk Road darkweb marketplace.
Brian Quintenz, Commissioner of the Commodity Futures Trading Commission, will not seek renomination and plans to stay on until his successor is appointed, following a five-year term. A long-time crypto advocate, Quintenz is noted for sponsoring the Technology Advisory Committee (TAC) and advocating for self regulation in the crypto industry.
Taking Flight Alexander Pack, managing partner of Dragonfly Capital Partners, has stepped down from the crypto investment firm, citing “a difference in vision on the direction of the firm.” Dragonfly launched in 2018 with $100 million under management and the mission to bridge investments between the U.S. and Asia.
Riding on Bison Decentralized finance protocol Keep Network has tapped Bison Trails, a Libra Association member, to provide non-custodial staking services for tBTC, an ERC-20 representation of bitcoin deposits. “Infrastructure is important because if your node is being asked to sign a message or it’s holding onto BTC as one of the shards, you ideally don’t ever want to be offline,” Bison Trails protocol specialist Viktor Bunin told CoinDesk in an interview.
Staking Ahead There are now at least 61,980 addresses with a balance in Kyber Network Crystal, an Ethereum token that fuels operations on the currency’s native exchange. This all-time-high comes ahead of a planned upgrade that would allow token holders to earn staking income on the decentralized Kyber Network.
Series A Taurus Group secured over €10 million in a Series A funding round led by Arab Bank. The firm now looks to expand its digital asset business and open offices in London, Paris and Frankfurt.
Ripple Exec Deplatformed YouTube has suspended Ripple CTO David Schwartz’s channel. This follows quickly on Ripple’s lawsuit, which claims the streaming giant failed to redress XRP scams and Ripple impersonators in videos. "Weirdly, YouTube just decided to suspend my channel (SJoelKatz) for impersonation. I wonder who they think I was impersonating," Schwartz tweeted.
Little Guys Go Big The number of network addresses holding at least 0.1 BTC (~$770) has continued to hit all-time highs, climbing to 3,010,784 on Monday, according to data from Glassnode. Beginning in February, exchanges have seen an increase in small purchases of bitcoin.
Coinbase of DAOs The OpenLaw LAO, or “Limited Liability Autonomous Organization,” opened Tuesday for investors looking to compliantly earn returns on the next wave of Ethereum-based projects. Initially capped at 100 accredited investors, the LAO will pursue venture capital deals via a smart contract that automatically pays out returns. If Coinbase legitimized the model first put forth by Mt. Gox, Wright said, the LAO could do the same for DAOs, said OpenLaw CEO Aaron Wright.
Crunchbase for Crypto Everest, an Ethereum-based social registry for tracking crypto projects, launched yesterday with an index of 100 decentralized projects. The service is predicted to become a “crypto Crunchbase,” according to Coinfund founder Jake Brukhman. (Decrypt)
COINDESK LIVE: LOCKDOWN EDITION
CoinDesk Live: Lockdown Edition continues its popular twice-weekly chats with Consensus speakers via Zoom and Twitter, giving you a preview of what’s to come at Consensus: Distributed, our first fully virtual - and fully free - big-tent conference May 11-15.
Zoom participants can ask questions directly to our guests. Register to join our fourth session Tuesday, April 28, with speaker Carlos Acevedo of Brave to discuss financial inclusion in the cryptocurrency movement, hosted by Consensus organizer Stephanie Izquieta.
MARKET INTEL
April's Gains Bitcoin's price jumped above $8,100 on Wednesday, making an April gain for the fifth consecutive year all but certain, predicts CoinDesk’s Omkar Godbole. The cryptocurrency is now up 26% on a month-to-date basis. “While a price pullback in the next 24 hours cannot be ruled out, a drop all the way back to levels under $6,428 looks unlikely, as technical studies are biased bullish and the speculative buzz surrounding the upcoming mining reward halving is likely to limit any losses,” he said.
Cambridge Survey CoinDesk is working with the Cambridge Centre for Alternative Finance (CCAF), an independent academic research institute at the University of Cambridge, on their 3rd Global Crypto Asset Benchmarking Study. To gather up-to-date information, the CCAF invites crypto companies to participate by completing one of the following surveys by May 1:
The resulting report will help us all get a better idea of where growth is happening, what it looks like, what barriers are in the way and what the short-term outlook holds. If you have any questions or feedback, you can contact the CCAF directly at a.blandin@jbs.cam.ac.uk.
COINDESK PODCAST NETWORK
Geopolitical Crisis Blockchain consultant Maya Zehavi joins The Breakdown to discuss how the COVID-19 health crisis is also a geopolitical event. On the docket is a review of how contact tracing apps are a battleground for mass surveillance, the mechanics of government intervention and the rise of localism.
CoinDesk Live: Lockdown Edition continues its popular twice-weekly virtual chats with Consensus speakers via Zoom and Twitter, giving you a preview of what’s to come at Consensus: Distributed, our first fully virtual – and fully free – big-tent conference May 11-15.
Register to join our fifth session Thursday, April 30, with speaker Hudson Jameson from the Ethereum Foundation to discuss private transactions, client improvements and dealing with FUD, hosted by Consensus organizer Nolan Bauerle. Zoom participants can ask questions directly to our guests.
