Blockchain This Week – Liquidations, Settlements, Donations, and Alliances

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A Massive Million-Dollar DeFi Market Liquidation

 On Feb 22, Decentralized Finance markets took a plunge that wiped out a record-high of close to US $115 million. The price calibration of Ether is widely cited as the reason. The price fell sharply from last week’s highs of US $2K to below $1,500 at the beginning of this week. At one point in time, one Ether was at $1,406.14. According to market analysts, the second-largest cryptocurrency by market value shed close to nine percent on Monday. Interestingly, while Ether was trading low at sub-1,500 in several exchanges, it was priced relatively even lower at $700 on the Kraken exchange.

The second-largest cryptocurrency by market value has recovered mildly since. At the time of writing, one Ether was worth $1,503.21

DeFi platform Compound Finance saw the highest loss of over US $86 million. Over 75 percent of the total liquidations came from Compound. Aave liquidated over US $13 million, while MakerDAO lost US $10 million. 

Bitcoin’s Ebbs and Flows

Bitcoin experienced a similar fall this week. The price dropped from an all-time high of over US $58,000 to below US $45,000 within 24 hours on Monday. The 11K drop is considered as one of the highest daily range plunge. Bitcoin, however, recovered within the next 24 hours to reclaim its US $50,000 position. But the price again plummeted below 45K, and at the time of writing, one Bitcoin was worth $47,813.46. The latest price drop is attributed to rising bond yields and losses in the stock markets.

MicroStrategy and Square Double Down on Their Bitcoin Investments

No amount of price volatility deters some staunch believers of Bitcoin. Among such maximalists are business intelligence firm MicroStrategy and Square, a payments platform owned by Twitter founder Jack Dorsey. 

MicroStrategy is a firm that has been systematically buying Bitcoin for a while now. It announced on Wednesday that it had purchased yet another US $1.026 billion worth of Bitcoin. It acquired 19,452 Bitcoin at an average price of US $52,765 per coin.

Meanwhile, Square revealed its purchase of US $170 million worth of Bitcoin ahead of its fourth-quarter earnings call on Tuesday. According to the announcement, the payments firm added 3,318 Bitcoin to its current reserve. Furthermore, as per the company’s earnings report filed with the US regulator, Square earned close to US $4.57 billion in revenue from its Bitcoin investment, amounting to a 785 percent increase in Bitcoin revenue.

Dubai Fund Disinvests in Bitcoin to Invest in Cardano and Polkadot

FD7 Ventures, a Dubai-based crypto fund, plans to sell US $750 million worth of Bitcoin next month. It intends to invest that money by buying Cardano and Polkadot. Prakash Chand, managing director at FD7, stated that “Ethereum, Cardano, and Polkadot would eventually be more valuable than Bitcoin within the next few years.”

Dorsey’s Bitcoin Donation

Jack Dorsey, the CEO of social media giant Twitter and the payments app Square, has reportedly donated one Bitcoin to a nonprofit group, Brink. Brink aims to use this fund to further its research to reinforce the Bitcoin network. Furthermore, it plans to support the Bitcoin developer community through funding and mentoring. Recently, the US Internal Revenue Service (IRS) has granted 503(c)(3) nonprofit status to Brink, thereby giving it a respite from federal taxation.

An Anonymous $800,000 Donation to Healthcare

Cape Cod Healthcare, based in Massachusetts, US, has received a large donation in the form of crypto. It has received US $400,000 worth of cryptocurrencies from a donor who wishes to remain anonymous. The same donor reportedly gifted another US $400,000 to the hospital last month. 

A Million Dollar Settlement

In April 2019, the New York Attorney General’s office (NYAG) launched a legal inquiry to look into the alleged misdoings of the crypto trading platform Bitfinex. According to the charges set forth by NYAG, Bitfinex, and its sister firm, Tether deceived clients and the market by overstating reserves while hiding close to US $850 million in losses. 

This week, the NYAG’s office announced a settlement with Bitfinex. Accordingly, Bitfinex and Tether will pay US $18.5 million as a part of the agreement and provide quarterly reports detailing how it manages Tether reserves for the next two years. These firms, however, will not admit to any wrongdoings.

Hedera Hashgraph Sets Foot in Africa

Standard Bank Group, Africa’s largest bank by assets, has entered into a strategic alliance with Hedera Hashgraph, the enterprise-focused distributed ledger technology (DLT.) Standard Bank Group will join Hedera’s governing council and also become its first Africa-based node operator. According to their joint announcement, this partnership will also focus on digitizing cross border trade using DLT. 

Block.one Joins LACCChain Global Alliance

Block.one, the company behind the EOS Blockchain, has signed a memorandum of understanding (MoU) with LACChain Global Alliance. LACChain is led by the Innovation Lab of the Inter-American Development Bank (IDB Lab). The group has 40 partners in 12 countries. It focuses on developing the blockchain ecosystem in Latin America and the Caribbean. 

Indian SBI Bank Joins JP Morgan’s Liink Network

State Bank of India, the largest bank in India, has tied up with the US bank JP Morgan. The Indian bank is planning to use Liink, JP Morgan’s Blockchain platform, to facilitate faster cross-border payments. Liink focuses on P2P transfers and ensures cross border trades are complete within a few hours as compared to 15 days using traditional methods.

First Ether EFT 

CI Global, a Canadian Asset Management firm, has filed for an Ether exchange traded fund (ETH.) Named CI Galaxy Ethereum ETF, this fund is set to become the first ETF in the world to enable investing directly in Ether. When approved, the ETF will trade on Toronto Stock Exchange with the ticker ETHX.

Stablecoin Backed by Canadian Dollar

VersaBank, based in Canada, is launching a stablecoin called VCAD. VCAD will be linked to the Canadian dollar deposits in the bank. The bank claims that VCAD is the first digital currency issued and backed by a bank. It has partnered with Stablecorp, a joint venture between crypto asset manager 3iQ and Mavennet.

Coinbase Files to Go Public

Coinbase Global Inc., the San Francisco-based crypto exchange has filed to go public with the US regulator SEC on Thursday. It is one of the prominent crypto exchanges in the world, with 43 million verified users. The filing reveals the extent to which Coinbase’s fortunes are tied to that of the Bitcoin market. It had earlier disclosed that it filed privately with the SEC to go public. As per the announcement, Coinbase shares will be listed on the Nasdaq Global Select Market via a direct listing under the ticker symbol COIN.

Indian Regulator Advises Against Crypto Holdings

The Securities and Exchange Board of India (SEBI) reportedly has asked the promoters of IPOs to sell-off their crypto investments before the IPOs. Though there is no official statement, SEBI is purportedly imparting such a message informally to several executives, lawyers, and merchant bankers over many weeks. 

South Korea Plans to Tax Crypto Gains Very Soon

South Korea is set to implement its long-planned crypto profits taxation. Starting Jan 1, 2022, the gains from crypto exceeding 2.5 million won (approximately US $2,300) will attract 20 percent tax. The tax will be levied for profits made by both trading and holding cryptocurrencies. Gains lesser than this amount will be exempt from taxation.

Wyoming – a Crypto Stronghold

Wyoming is one of the few crypto-friendly US states that double downs on Blockchain adoption. This week, this state introduced a bill to introduce a filing system for companies using blockchain technology. The proposed legislation intends to implement this Blockchain-powered system by the end of 2021.

Meanwhile, Ripple Labs, the Blockchain-based payments provider, is now a registered business in Wyoming. As per the state records, Ripple will be a limited liability firm based in Cheyenne, Wyoming. Crypto-friendly laws are supposedly the reason why the crypto firms are increasingly moving to this state.

Switzerland’s Oldest Bank Offers Crypto Trading

Bordier & Cie, a private Swiss bank founded in 1844, has started offering crypto trading services to its customers. According to the announcement made this week, the bank’s clients can hold and trade cryptocurrencies, including Bitcoin, Ether, and Bitcoin Cash. Bordier has partnered with Syngum Bank to enable this service.

Opera Browser’s Crypto on-Ramp

Opera has partnered with Simplex to provide its web browser users the ability to exchange fiat for crypto directly from within the browser. Opera was also one of the first browsers that added inbuilt Bitcoin, Ether, and Tronix crypto wallets as browser extensions.

Crypto.com’s 70 Billion Token Burn Roadmap

Ahead of its mainnet launch scheduled for Mar 25, the crypto exchange crypto.com has released a plan for increasing its circulating supply. Accordingly, 59.6 billion CRO, the platform’s native currency, was burned on Feb 22. The firm plans to burn an additional 10.4 billion of CRO every month. According to crypto.com, the 70 billion token burn is the largest in history. It would increase the supply of CRO from the current 24 percent to over 80 percent.

US Energy Department Intends to Commercialize Mining Malware Detection Software

The US Department of Energy (DOE) had floated a contract asking private firms to help them commercialize a cryptojacking detection algorithm. The DOE officials believe that this software is a potent tool to sniff out illicit mining software that is inconspicuously harnessing the hosts’ computing power to mine crypto. The solicitation initially intended to be open until Mar 10, was made inactive within 24 hours.

FTX Launches Futures Option to Bet on Olympics 2021

Cryptocurrency derivatives exchange FTX has launched a specialized futures contract to bet on the likelihood of the Olympic Games happening in Tokyo this year. The pandemic continues to cast a shadow over the safety of hosting the event. As per FTX, the uncertainty could become a lucrative market for the futures. 

And Finally, NFT Business Soars

First, the artwork of the digital artist Beeple that went under the hammer earlier this week has already received a bid of $1.8 million. The starting bid quoted before the auction commenced was US $100. Moreover, there are still two weeks left before the close of the auction.

Second, 34 CryptoPunks, a batch of digital collectibles, were sold for close to US $1 million worth of Ether within minutes of launch. An anonymous collector bought these Punks from the Larva Labs marketplace for 557.5 Ether.Finally, Micah Johnson, a former Major League Baseball (MLB) player turned artist, sold US $1 million worth of his tokenized art within a minute into the sale. The auction lasted for 28 hours and generated US $2 million in sales.

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