Day: November 3, 2022

Santander Imposes Limit on Crypto Transactions for UK Customers

by Blockchain News

The British branch of the Spanish multinational commercial bank and financial services company, Santander, has now imposed a £1,000 ($1,120) limit on crypto transactions for customers in the UK. 

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Emphasizing protection from crypto fraud, Santander says this restriction is intended to protect customers from crypto investment risks. The firm noted,

 

“We want to do everything we can to protect our customers, and we feel that limiting payments to cryptocurrency exchanges is the best way to make sure your money stays safe.”

 

Additionally, the bank also stated from the 15th of November 2022, a limit to making crypto transactions worth $3,360 during 30 days would be implemented. The restriction only applies to customers who use their Santander bank account to deposit funds into crypto exchanges.

 

Though customers can still withdraw from exchanges to their bank account, the bank added that it would eventually be making more changes to these limits and completely ban the depositing of funds into crypto exchanges in the future. 

 

Notably, this is not Santander’s first move disapproving crypto transactions. Last year, the bank blocked payments from its UK customers to the Binance crypto exchange, stating it was to protect customers’ funds. 

 

The blocking was related to the UK’s financial regulator (Financial Conduct Authority)’s recent warning that Binance Markets Limited is not allowed to conduct any regulated activities in the country. At the end of the note, the bank mentioned the payments of funds into the Binance exchange still remain banned. 

Not only Santander was in the mood to block crypto transactions last year, but Former Member of the British Parliament Nick Boles was also in the zone of disapproving the largest cryptocurrency by market cap, Bitcoin. Nick suggested to the Central Banks that anyone wanting to use Bitcoin for any payments should be forced to exchange it for another currency.

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Goldman Sachs to Launch Data Service to Classify Digital Assets

by Blockchain News

Investment bank and Financial service firm Goldman Sachs has revealed it is set to release a data service to classify hundreds of digital coins and tokens so institutional investors can comprehend the rapidly growing digital asset class.

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Created in collaboration with global index provider MSCI and crypto data firm Coinmetrics, the data service is called Datanomy. The name was derived from the combination of data and taxonomy –  a branch of science focused on naming and classifying the natural world.

Datanomy is created to address the issue of many digital assets not being classified into their respective sectors. As the digital asset ecosystem has been expanding over the years, it could appear overwhelming to grasp if not familiar with the various sectors of the expansion.

Coin Metrics CEO Tim Rice said large asset managers wanted an “adult framework” to understand digital assets better and invariably discuss them.

Rice added,

“We’ve organized it in an intuitive manner that should help asset managers come into this asset class in a much more standardized fashion.This is the next phase of getting the underpinnings of the industry lined up so that everybody can embrace it, and we can figure out what the next directional move in the market is.”

Users can access Datanomy either as a subscription-based data feed or via Marquee – a platform by Goldman Sachs used as a digital storefront for institutional investors.

In addition, Datanomy provides users with analysis and research, as well as benchmarking performance, managing portfolios, or creating investment products depending on the sectors that include decentralized finance, smart contract platforms, metaverse, or value transfer coins.

Anne Marie Darling, head of the client strategy for Goldman’s Marquee platform, noted,

“We’re trying to create a framework for the digital asset ecosystem that our clients can understand because they increasingly need to think about performance tracking and risk management in digital assets.”

Digital assets on Datanomy would be divided into classes, sectors, and sub-sectors based on the usage of the tokens or coins. According to Darling, this will enable asset management firms and money managers at hedge funds to familiarize crypto with how equities can be debatable as industry sectors like finance or technology or themes like growth versus value stocks.

Notably, Datanomy is just one of the products Goldman Sachs has launched in recent times to achieve its expansion goal beyond Bitcoin-focused products in the crypto market. In June, the investment bank launched an Ethereum-linked derivative product to offer institutional investors indirect exposure to the cryptocurrency market.

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Crypto Exchange OKX Opens Regional Office in the Bahamas

by Blockchain News

OKX, one of the leading digital currency trading platforms in the world has announced the establishment of OKX Bahamas, a regional hub that will be tasked with serving customers in the country, the Bahamas, and the broader Latin American world.

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The trading platform said it created the office in the Bahamas after its registration as a Digital Asset Business in The Bahamas under the newly adopted Digital Assets and Registered Exchanges (DARE) Act. The company said it is now riding on the progressive regulatory push from the Securities Commission of the Bahamas to extend its influence in the country.

 

OKX also announced the appointment of blockchain industry veteran, Dr. Jillian Bethel, an industry veteran to serve as the CEO of OKX Bahamas. Jillian is not just an expert in the space, he understands the regulatory permissions available in the Bahamas and is in the best position to help pilot the affairs of the trading platform.

 

“The DARE Act has made the Bahamas a pioneer in digital asset adoption, and I’m proud to lead the OKX Bahamas team in championing crypto,” CEO Bethel said in a statement. “As a gateway to the Caribbean and the broader Americas, the Bahamas is opening new doors for local talent and global businesses to thrive here with forward-looking policy.”

 

The Bahamas’ attractiveness has pushed big platforms in the ecosystem including FTX Derivatives Exchange to move its headquarters down there last year after Hong Kong took a hardcore stance into the industry. 

 

Newly acquired Huobi Global exchange has also been mulling plans to shift its base from Seychelles to the Caribbean Islands with the Bahamas amongst the top destinations according to an earlier report by Blockchain.News.


OKX has been growing its global footprint over the years and beyond The Bahamas licensing, the exchange has also secured approval to operate in Dubai.

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ApeCoin DAO Signs Off on a $4.4M Bug Bounty

by Blockchain News

ApeCoin DAO, the Decentralized Autonomous Organization that is in charge of overseeing the development of APE, the native token of the Bored Ape Yacht Club (BAYC) ecosystem, has approved the allocation of $4.4 million to conduct a bug bounty program on ImmuneFi.

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According to the snapshot of the votes cast which ended today, as many as 3.9 million APE tokens were cast in favor of the proposal, dubbed AIP-134.

The votes in favor ended at 57.92% as compared to 42.08% for those who committed 2.9 million APE against the proposal. 

The essence of the bug bounty is to carve out an extra security layer for the much anticipated ApeCoin staking service that is billed to go live in December. The ApeCoin DAO wants experienced hackers to help search out the loopholes or any porous avenues in the staking smart contract that may cause headaches later on.

The bounty, now that it has been approved can be launched on ImmuneFi with the 1 million APE tokens earmarked for the bounty set to be drafted from the protocol’s treasury.

“As we near the launch of the ApeCoin staking system outlined in AIP-21 and AIP-22, we propose taking additional measures to ensure the DAO is following smart contract security best practices. This proposal uses treasury assets to fund a 1 million $APE bug bounty program with Immunefi, and partners with Llama to help design, implement, and run operations of these initiatives,” a snapshot from the proposal reads.

The DeFi ecosystem has not been spared from the wranglings and inconveniences caused by hackers this year. That there is a security loophole in most emerging smart contracts is not a question up for debate, whether founding teams have the right model to prevent exploitation remains a major bone of contention.

As one of the most prestigious NFT collections, Bored Ape users have been a major target of cybercriminals, and hopefully, the bug bounty will help tighten all loose ends ahead of the launch of the staking product.

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Fidelity Launches a New Commission-Free Crypto Trading Product

by Blockchain News

Fidelity Investments, one of the largest asset management firms in the world has launched a crypto trading service, giving its customers the ability to embrace Bitcoin (BTC) and Ethereum (ETH) directly.

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As reported by CNBC, the new service is dubbed Fidelity Crypto and will be powered by Fidelity Digital Assets, a more developed offshoot the company launched to handle its investments in the nascent crypto ecosystem.

 

Embracing Bitcoin and Ethereum through Fidelity has been made relatively hassle-free as no commission is charged. While most institutional investment firms typically require only their most wealthy clients to invest in cryptocurrencies, Fidelity has set a threshold of a minimum of $1 in order to be able to maintain the account.

 

The company said it will be adopting the revenue generation model of Robinhood and Binance.US and it will be adding a 1% spread into every trade execution price.

 

“Where our customers invest matters more than ever,” Fidelity said in a statement shared with CNBC. “A meaningful portion of Fidelity customers are already interested in and own crypto. We are providing them with tools to support their choice, so they can benefit from Fidelity’s education, research, and technology.”

 

Fidelity has over $9.9 trillion in assets under management, and it has been exploring renewed strategies and models to dominate the crypto ecosystem. Just like BlackRock, Fidelity has launched a good number of crypto products over the years and as well, partnered with so many other crypto firms.

 

That big money firms are getting into the crypto bandwagon spells a lot of good omen for how far the industry has come over the past decade. With outfits like Fidelity and BlackRock now leaning to offer services that are predominantly reserved for crypto exchanges, the competition is growing and geared to benefit consumers in the Web3.0 ecosystem much more.

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Bakkt Has Agreed to Acquire Apex Crypto for $200M

by Blockchain News

Publicly listed Bitcoin firm Bakkt has agreed to pay the sum of $200 million as it looks to acquire Apex Crypto LLC, a subsidiary of Apex FinTech Solutions Inc.

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By being a part of the Bakkt brand, Apex Crypto will help to bolster the business operations of the parent firm, drawing on its unique infrastructure to help bridge the gap between companies in the mainstream sector and those in crypto.

According to the terms of the deal, Bakkt will be paying the sum of $55 million in cash outright while paying $45 million when Apex Crypto meets its financial targets for the end of the Fourth Quarter (Q4) this year.

“We found a unique asset in Apex Crypto, which will expand our crypto client base, provide us with faster speed to market for new crypto capabilities, and serve as an additional avenue for continued sales to a crypto-savvy audience through Apex Fintech Solutions,” said Gavin Michael, CEO of Bakkt. 

“With the addition of this complementary business, we believe we are poised to be a crypto provider of choice for financial institutions, fintechs, merchants or loyalty programs that want to offer seamless crypto experiences to their customers. It’s also expected to enable us to unlock more innovative opportunities that appeal to the next generation of consumers such as crypto rewards and NFTs.”

Bakkt went public on the New York Stock Exchange (NYSE) back in October last year, setting a whole new agenda for the company in the Web3.0 world. The company has not sat on its oars over the past few years, launching innovative products to serve both its institutional and retail customers.

From partnering with Starbucks to floating a crypto product with Galaxy Digital, Bakkt has ingrained its footprint across the length and breadth of the digital currency ecosystem. The deal with Apex Crypto will contribute to bolstering these footprints when it closes following regulatory approvals.

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JPMorgan Pulls Off First Live Trade on Public Blockchain

by Blockchain News

JPMorgan Chase & Co has successfully conducted its first live trade on a public blockchain.

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Through the trade, the multinational bank was able to issue tokenised $71,000. It was part of the Singapore central bank’s pilot programs that are testing the use of decentralised finance (DeFi) in the banking sector. Following that trade, JPMorgan traded it for tokenised yen with Japan’s SBI Digital Asset Holdings.

It signifies a big step towards entering the system that operates the world of cryptocurrencies and showcases the potential for other global banks to follow in its footsteps.

Other banks such as DBS Bank Ltd., Standard Chartered PLC and HSBC Holdings Plc are also part of the pilot testing rounds for JPMorgan’s live trade on a public blockchain.

This is not JPMorgan’s first use of blockchain technology to conduct transactions.

On May 20, JPMorgan Chase used cryptocurrency tokens for collateral in traditional financial asset transactions for the first time. 

Even though the live trade transaction was not for cryptocurrencies, the infrastructure used to execute the test was developed by crypto firms, the Polygon blockchain. JPMorgan used Polygon as it makes transactions on the Ethereum blockchain cheaper and a modified version of Aave, a major DeFi lending project.

Tyrone Lobban, head of Blockchain Launch and Onyx Digital Assets at JPMorgan, told Bloomberg, “today was the first step to show that we can actually trade on these public networks,” adding that “the future is really working toward scaling this pivotal moment.”

Prior to JPMorgan’s successful completion of the live trade, several other Wall Street institutions have been exploring the use of blockchain. Test and research for businesses to use the blockchain have been ongoing, especially for intraday repurchase – a sort of short-term borrowing in fixed income – and cross-border trades.

However, current efforts by banks are typically based on private blockchains that need users to receive permission to join.

According to Bloomberg, the use of public blockchains can eliminate challenges such as isolated or fragmented liquidity, which will provide the public access to the infrastructure.

In the interview with Bloomberg, Lobban added, “we clearly see what’s happening in the public domain, and we can see how the innovation is creating not only new ways of doing financial transactions but new types of products as well.”

He added that the bank plans to explore using other blockchain networks in the future.

In May, JPMorgan announced that the bank would use blockchain technology in the collateral settlement, planning to expand to other asset types such as equities and fixed income, according to Bloomberg.

Two of the bank’s entities are using tokens of BlackRock money market fund shares as collateral on their private blockchains, allowing trading outside of market hours.

To date, the bank has processed more than $300 billion in repo transactions using blockchain.

In addition to being used for derivatives, repo transactions, securities lending, and other transactions, a blockchain-based collateral settlement will also expand the application scope of tokenised collateral, providing investors with a wider variety of assets to invest as collateral.

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Binance to Consider Buying Banks with $1 Billion , CEO CZ Discloses

by Blockchain News

Binance is considering buying banks to bridge the gap between the worlds of traditional finance and cryptocurrency, founder and CEO Changpeng Zhao (CZ) said in an interview with Bloomberg.

The billionaire did not disclose specific targets, saying he was open to minority investments or full takeovers. Zhao also pointed out that investment banking is a reasonable strategy for Binance because when partnering with banks, Binance usually attracts many new users, which will also boost the bank’s valuation.

“What we have found is when banks work with us, we drive so many users to them, so the bank’s valuation goes up, like why don’t we just invest in them as well, so that we capture some of the equity upside, “he said.

CZ said in an interview at the Web Summit in Lisbon: “There are people who hold certain types of local licenses, traditional banking, payment-service providers, even banks. We’re looking at those things.”

Zhao has said in the past that Binance has more than $1 billion to spend on acquisitions, with its acquisition strategy focused on areas such as DeFi and NFTs.

He stressed that traditional financial institutions are now more closely linked to the cryptocurrency industry as a whole. He said that despite the cold winter in the cryptocurrency market due to a number of factors, such as interest rate hikes, the correlation between digital assets and traditional finance -“TradFi” is still deepening. Well-known traditional financial services companies include Goldman Sachs Group Inc., BlackRock Inc, etc.

In June, U.S. multinational investment bank Goldman Sachs Group Inc showed interest in acquiring troubled cryptocurrency lender Celsius Network, hoping to buy the company at a steep discount, according to two people familiar with the matter.

In September, BlackRock, a New York-based US multinational investment company, has expanded its crypto service offerings by launching a new exchange-traded fund (ETF) that provides exposure to blockchain and crypto companies for its European customers.

Binance recently confirmed that the crypto exchange has invested in Musk’s Twitter deal. In a statement, Binance quoted its co-founder, billionaire Changpeng Zhao (CZ), as saying that Binance had committed to spending $500 for Musk to acquire Twitter as part of its strategy to bring social media and news sites into the web3 world.

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Bitcoin Holds Steady at $20,000 Level as The Fed Hikes Rates as Expected

by Blockchain News

The U.S. Federal Reserve on Wednesday raised its benchmark interest rate by 75 basis points to a range of 3.75% to 4%, a move that market participants, including cryptocurrency traders, highly expected.

It is the fourth consecutive rate hike introduced by the Fed this year, designed to cool the economy and fight record inflation.

Bitcoin reacted with an immediate 3% upside swing, climbing at $20,700 on the 18:00 (UTC) candle. But the crypto lost 0.60% of its gains after Federal Reserve Chairman Jerome Powell sent up mixed messages in the press conference.

The Fed stated that it was considering slowing down interest-rate increases. The announcement prompted Bitcoin to initially rally up to almost $20,800 after the central bank said it “will take into account the cumulative tightening” and “the lags with which monetary policy affects economic activity and inflation” when it next decides rates.

But Bitcoin reversed its course when Powell said a more mixed message on the Fed’s plans: “We still have some ways to go,” and further, the Fed’s chair said, “incoming data … suggests that the ultimate level of interest rates will be higher than previously expected.”

Bitcoin fell below the $20,200 level based on the comment on Wednesday afternoon after nearly hitting $20,800 before the Fed Rate hike. The world’s largest cryptocurrency is still up from roughly $19,300 last Monday. Meanwhile, Ethereum is below $1,520 after it dropped from $1,634 over the weekend. ETH is still well above its $1,340 level at the beginning of last week.

Cryptocurrencies exhibited the same price movement witnessed in the stock market. The Dow Jones Industrial Average and S&P 500 dropped 1.5% and 2.4% Wednesday, respectively. And this reminded crypto traders that the correlation to equities still remains intact as the central bank is the one pulling the strings. The current environment of high inflation and rising interest rates has dampened demand for risky assets.

The flagship cryptocurrency looks vulnerable to falling its value below the $20,000 level and moving back into the $19,000 to $20,000 range, where it has been trading for most of the past two months.

Edward Moya, an analyst at broker Oanda, commented on the market development: “The initial Fed reaction was rather strong for most risky assets, but it was not sustained as the central bank will remain dependent on the next round of inflation data.”

Michael Safai, a partner at trading firm Dexterity Capital, also said: “The devil was not in the data but in the language. All eyes will turn towards next week’s CPI reaU.S. [of U.S. inflation]. If the data isn’t as hopeful as the Fed’s ambitions, crypto investors could pull back once more.”

U.S.e next U.S. Fed Reserve FOMC Meeting is scheduled for December 14-15, when market participants will gauge whether Powell intends to slow down with the pace of rate increases.

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Crypto Hedge Fund Protocol Ventures to Shut Down Amid Market Fraught

by Blockchain News

Protocol Ventures LP, a major US crypto hedge fund, has announced plans to close down its business and return cash to investors following the plunge in the market for digital assets. That is according to people familiar with sources, who asked for their identities to remain anonymous.

Protocol Ventures sent notices to investors at the end of October about the move, the sources revealed. One of the people said that the hedge fund is expecting to complete the closure by year-end or the first quarter of 2023.

Investors in Protocol’s fund of hedge funds may have lost as much as 90% over the past year, as per the sources.

Protocol Ventures is a fund of crypto hedge fund that invested in companies such as BlockTower Capital, Multicoin Capital, Pantera, and Electric Capital, among others. Protocol’s decision to wind down its business comes amid broad turbulence in the digital asset sector, which has lost a $2 trillion market value over six months.

In 2021, crypto hedge funds gained widespread popularity as the pandemic severely impacted the financial markets. As a result, the economic crisis triggered investors to embrace cryptocurrency as safe-haven assets.

However, outperformance rapidly dissipated after central banks globally hiked interest rates to fight inflation since the beginning of this year. The aggressive shift dramatically tightened financial conditions and reduced the appetite for riskier investments.

As a result, a major cryptocurrency hedge fund based in Singapore, called Three Arrows Capital (3AC), fell into liquidation in June this year due to the ongoing crypto winter that started harshly in May. The plunge in cryptocurrency prices, which wiped off billions of dollars in the market, significantly hurt 3AC and exposed a liquidity crisis at the firm.

With a net asset value of $18 billion in its last public statement, 3AC was known for directly taking large, highly leveraged stakes in crypto businesses and cryptocurrencies. But the turmoil in the crypto markets wiped out the value of those holdings.

In June, Mike Novogratz, the founder and CEO of Galaxy Digital, anticipated that two-thirds of the hedge funds that invest in crypto would fail due to the ongoing market turbulence.

Novogratz cited the wider financial market’s reaction to the removal of stimulus by the US central bank as the reason for the crash of the cryptocurrency prices. The executive said the collapse of the TerraUSD stablecoin, in which he and Galaxy were investors, was triggered by broader macroeconomic factors rather than flaws in the project.

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Bitcoin (BTC) $ 44,184.84 1.58%
Ethereum (ETH) $ 2,355.38 0.65%
Litecoin (LTC) $ 77.91 5.33%
Bitcoin Cash (BCH) $ 253.86 2.48%