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Crypto This Monday: CME Closes in on Binance in Futures, VanEck Revamps ETF Seeding, and More
October 30 2023 - 04:21PM
IH Market News

VanEck modifies Bitcoin ETF strategy for SEC

VanEck, the asset manager, made modifications to its Bitcoin ETF request to the Securities and Exchange Commission on October 27, adopting a unique seeding method. Seeding is the initial funding required to launch an ETF. This fund helps to create units that underpin the ETF, allowing the trading of shares on the open market. Financial expert Scott Johnson noted that VanEck’s seeding method will be distinctive compared to its competitor, BlackRock (NYSE:BLK). This technique implies an anonymous investor recently acquired Seed Creation Baskets from the fund. Despite the differences, the language in the request is similar to BlackRock’s, reflecting similar legal consultations.

Bankman-Fried defense intensifies in court

On Monday, Sam Bankman-Fried held firm in his defense against allegations of fraud in managing FTX and Alameda Research. He confirmed certain details provided by company witnesses but also presented alternative explanations, refuting some of the allegations. Referring to Alameda’s rapid financial decline in 2022, he described the events as a “bank run”. Bankman-Fried maintained he was poorly informed about his company’s precarious financial situation until the main assets sharply depreciated. He reiterated that FTX’s decline was due to mistakes, including those by key figures, such as former Alameda CEO, Caroline Ellison.

CME rises to second place in Bitcoin futures contracts
The Chicago Mercantile Exchange (CME) reached second place in Bitcoin futures exchanges in terms of open notional contracts, trailing only Binance. On October 30, CME recorded contracts worth $3.58 billion, surpassing Bybit and OKX, and closing in on Binance’s $3.9 billion. This growth reflects the increasing interest from traders, mainly institutional, in CME’s Bitcoin futures, especially after the recent Bitcoin price spike.

Kraken complies with court order and will share user data with the IRS
US-based exchange Kraken announced it will send the IRS data of 42,000 users, as ordered by the court. Although initially challenging the scope of the subpoena, the company ended up narrowing the range of information. The court specified that included clients would be those with transactions above $20,000 between 2016 and 2020. In a similar situation, Coinbase (NASDAQ:COIN) warned 13,000 users about the handover of their data to the IRS for the years 2013 to 2015.

Movement of UNI tokens by Uniswap Foundation causes fanfare
The Uniswap Foundation (COIN:UNIUSD) transferred about 10 million UNI tokens, valued at over $40 million, to various cryptocurrency exchanges last week. Data reveals significant transfers to OKX, Kraken, and FalconX. Although such movements often signal potential sales, raising community concerns, these transactions are believed to be for operational purposes. Concurrently, Uniswap’s new swap fee generated over $600,000 in two weeks, thanks to its revised fee structure.

Celestia’s TIA token gears up for mainnet launch
The TIA token (COIN:TIAUSD) of the Celestia blockchain is gearing up for its mainnet launch. Binance, Kucoin, and Bybit plan to list the token on October 31. With a total estimated supply of 1 billion, TIA’s diluted value is approximately $3.1 billion. Last year, Celestia raised $55 million in investments led by Bain Capital Crypto and Polychain Capital.

PancakeSwap launches portfolio management with Bril Finance partnership
PancakeSwap, a decentralized exchange, announced on October 30 the inclusion of a portfolio management tool in collaboration with Bril Finance. This feature allows users to deposit tokens into vaults and use a liquidity provision algorithm. It is expected that this system will offer more attractive returns. The protocol supports cryptocurrencies such as USDT (COIN:USDTUSD), BTC (COIN:BTCUSD), and ETH (COIN:ETHUSD) and displayed an internal rate of return exceeding 24% in tests. During the launch month, additional rewards will be provided. Mochi, PancakeSwap’s CEO, views the integration as a step towards becoming an essential core for DeFi: “Our goal is to become a hub for all DeFi, and integrations like this allow us to be a one-stop-shop for portfolio management. Bril’s automated technology and its integration with PancakeSwap will enable PancakeSwap users to leverage the main features and functionalities they are already familiar with and easily earn from their assets in a practical way.”

OPNX platform abandons legal action against investor Mike Dudas
OPNX, tied to the founders of Three Arrows Capital, dropped the defamation lawsuit against cryptocurrency investor Mike Dudas. In June, Dudas was sued after tweeting that OPNX supporters were “scammers”. OPNX has ties to leaders of crypto companies that have already gone bust, such as Mark Lamb of CoinFLEX and Su Zhu and Kyle Davies of Three Arrows Capital, a fund that collapsed affecting the crypto market.

Attack on LastPass results in the theft of US$4.4 million in cryptocurrencies
Hackers stole $4.4 million in cryptocurrencies from 25 LastPass users on October 25. Blockchain analyst ZachXBT unveiled the theft, and Taylor Monahan of MetaMask identified 80 compromised wallets. The funds came from various blockchains, such as Bitcoin and Ethereum. ZachXBT warned users who stored keys in LastPass to transfer their assets. This situation exposes the vulnerabilities of using password managers for holding critical cryptographic keys.

Tether dominating the Brazilian crypto market
In 2023, the use of the stablecoin Tether (COIN:USDTUSD) in Brazil grew significantly, representing 80% of all crypto transactions. According to data from the Brazilian tax agency, by October, USDT transactions amounted to about $55 billion, greatly surpassing Bitcoin (COIN:BTCUSD) with $30 billion. The preference for USDT had already surpassed Bitcoin in 2022. The new Brazilian legislation now taxes crypto assets held abroad, and the rate can vary from 15% to 22.5%, depending on the amount transacted.

Zodia Custody expands services to Hong Kong
Zodia Custody, backed by Standard Chartered (LSE:STAN), is extending its digital asset custody services to Hong Kong. This decision follows the company’s recent expansions in the UK and the Asia-Pacific region, including Australia and Singapore. CEO Julian Sawyer highlighted the growing institutional interest in Hong Kong, making the city an attractive market. Hong Kong’s recent retail cryptocurrency trading licensing initiative reinforces its role as a crypto hub in Asia.

Singapore joins forces with Japan, Switzerland and UK in digital assets

The central bank of Singapore, the Monetary Authority of Singapore (MAS), has partnered with financial institutions from Japan, Switzerland, and the UK to develop digital asset pilots. This collaboration will mainly focus on fixed income products, foreign exchange, and asset management. Part of this initiative stems from Singapore’s Guardian Project, aimed at tokenizing assets. The goal is to explore common standards, identify risks and legal gaps, and advance the understanding of the opportunities and challenges of digital assets.

K-Bank acquires majority of cryptocurrency exchange Satang
Thailand’s Kasikorn Bank, or K-Bank, has purchased 97% of the cryptocurrency exchange Satang, active since 2017. The deal, valued at $102.8 million, was brokered by the new subsidiary Unita Capital. With the acquisition’s completion, Satang will be renamed Orbix, which will have three subsidiaries focused on digital assets. This move comes after K-Bank launched a $100 million fund for web3 and fintech. Experts predict a more competitive Thai crypto market with the entry of major players.

UK tightens stablecoin regulation
The UK has released updated plans for the regulation of fiat-backed stablecoins. Her Majesty’s Treasury plans to introduce legislation in 2024, placing the regulation of these assets under the purview of the Financial Conduct Authority (FCA). This measure aims to ensure that foreign stablecoins meet local standards. Stablecoins not backed by fiat will remain unregulated. Furthermore, stablecoin issuers will be required to maintain reserve funds in a legal trust, with terms set by the FCA.

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