#Top Investors Bet $7 Million that DeFi Will Move to Polkadot Network

 

                 

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Polkadot continues to attract DeFi developers and investors alike as the newly-launched network looks to take on Ethereum.

Acala, a DAO established on the newly-launched Polkadot network, has announced a successful series A funding from 15 high profile investors, such as Pantera Capital, Arrington XRP Capital, ParaFi Capital, CoinFund, DCG, Spartan Group, and others. 

Santiago Roel Santos, Partner at ParaFi Capital, says: 

“At ParaFi, we envision a constellation of DeFi ecosystems spanning multiple chains and believe that would be a win-win for the broader crypto industry. Acala is our first DeFi investment in Polkadot, and one of our first outside Ethereum. We are encouraged by the pace of development and innovation by Acala and are excited to join the team in their journey to become the primary DeFi hub of the Polkadot ecosystem.”

The investment is a simple agreement for future tokens (SAFT) deal and was led by Pantera Capital. According to Coindesk, the total amount raised is around $7 million.

Acala is a financial primitives platform that will provide an alternative infrastructure for DeFi on Polkadot’s multi-chain ecosystem. The Acala platform will feature a MakerDAO-like governance structure with split governance (ACA) and stablecoin (aUSD) tokens on the Polkadot network. 

However, it plans to go beyond MakerDAO’s current capabilities with a decentralized exchange (DEX) on top.

The need for a fast and cheap blockchain is rising, as Ethereum-based DeFi continues to be an unattainable investment for small retail investors. The rising gas fees are just one example of this, and may ultimately result in an investor migration from Ethereum to Polkadot. 

Regardless of the short term implications of Polkadot’s launch and Acala’s fundraising success, in the long run, Ethereum competition is extremely beneficial for everybody involved in crypto.

##US dollar is getting weaker while crypto gets stronger, says Ripple CEO

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People are losing confidence in fiat currencies and are looking for alternatives such as crypto, says Brad Garlinghouse.




In brief

Global populations continue to lose confidence in fiat currencies, said Brad Garlinghouse.


While the US dollar will remain the world's reserve currency in the near future, it's getting increasingly weaker, he added.


At the same time, cryptocurrencies are significantly outpacing the US dollar in terms of increasing their value.



While the US dollar won’t give up its position as the world’s reserve currency any time soon, it’s definitely getting weaker compared to alternatives such as Bitcoin, wrote Brad Garlinghouse, the CEO of Ripple (XRP), on Twitter today.


“A year ago, many decried crypto as a scam, and now a majority of govts are looking seriously at blockchain. It addresses frictions (i.e. settlement, transparency, etc) that were assumed VERY hard to solve before. Crypto is up 80% while USD is down 3% YTD,” Garlinghouse noted.



As Decrypt reported, many financial experts are currently concerned that the US government’s unprecedented fiscal stimulus efforts in the wake of the coronavirus pandemic could lead to the devaluation of the US dollar—and potential subsequent strengthening of other stores of value, including cryptocurrencies. 


Garlinghouse added that traditional monetary systems are usually as strong as people’s trust in them—and fiat currencies are increasingly losing it today.


“As [Fundstrat managing partner Tom Lee] said, it comes down to trust in the financial system at the end of the day,” wrote Garlinghous, adding that “As global populations continue to lose confidence in fiat currencies (as we’re seeing with USD), they will choose to diversify. Our future global financial system will do the same.”



The very same sentiment was expressed by several financial experts in Bloomberg’s article that Garlinghous cited. Its authors noted that while cryptocurrencies are notoriously volatile and prone to manipulation, the blockchain technology that underpins them already gained some very influential proponents.


“At the end of the day, trust is really getting broken in the traditional financial system—that’s the theme. The less trust you have in the dollar, the more you want alternatives,” Tom Lee, co-founder and head of research at Fundstrat Global Advisors, told Bloomberg. “More and more people are saying, ‘You know what? It’s not such a bad idea to be decentralized.’”

Ledger and Nomura launch institutional-grade Bitcoin custody service

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A large investment bank has launched a crypto custodian service for institutional investors.




Global investment bank Nomura, hardware wallet company Ledger and crypto investment fund CoinShares today launched a long-awaited crypto custodian service, called Komainu.


First announced in May 2018, Komainu will service institutional investors and support a range of cryptocurrencies. It is regulated by the Jersey Financial Services Commission.




Komainu is headed by Jean-Marie Mognetti, the co-founder and CEO of CoinShares. Andrew Morfill left his position at Santander, where he commanded its cyber defense unit, to join Komainu as Head of Operations.



Mognetti said in a statement that: "What this partnership has highlighted is the need for credible and solid service providers to support industry participants. Komainu bridges the gap by bringing financial expertise and capabilities for institutional clients to feel confident their assets are in safe hands.



Mognetti told Reuters that the platform has been trialed with a small number of clients for four to five months. Komainu’s advantages over other systems are, it claims, that it can integrate with the technology systems of large financial institutions.



The CEO of Ledger, Pascal Gauthier, said in a statement that “Institutions are looking for compliance and security when it comes to the custody of digital assets.” He added that, without the proper security, “institutions' digital assets are weaponised against them.”


Nomura is the latest large financial institution to offer custody services. Fidelity also offers a custodian, as does Bakkt, the custodian and Bitcoin futures platform owned by the Intercontinental Exchange, which also runs the New York Stock Exchange.



Nomura in January launched a crypto-asset benchmark for Japanese investors. Called the NRI/IU Crypto-Asset Index, the benchmark tracks top cryptocurrencies, among them Bitcoin and Ethereum. Nomura is also on the governing council of blockchain network Hedera Hashgraph, where it lords over the network alongside Google and Deutsche Telekom.



The institutional investors, it appears, are here to stay.

###Coinbase announces Rosetta toolkit for blockchain integration

   



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Crypto exchange Coinbase has announced the release of Rosetta, a set of tools designed to help exchanges and developers integrate any blockchain.





In brief


Coinbase released its blockchain integration tool, Rosetta.



It's aimed at exchanges as well as developers working on cross-blockchain applications.



Celo, Filecoin, and other teams have already contributed to the open-source software.


Popular San Francisco-based crypto exchange Coinbase has released Rosetta, a toolkit designed to make blockchain integration simpler and more effective, especially for exchanges working with new tokens.



In a blog post, Coinbase stated that Rosetta will be available starting today for digital currency exchanges and blockchain developers alike. 



With the number of blockchains increasing—and with each blockchain featuring unique specifications—exchanges have to take time and care when integrating with different blockchains. Coinbase saw the need for standardization. Therefore, it says, Rosetta is designed to keep funds secure and take care of compatibility issues that can slow developers down. 



In addition to exchanges, the company believes other cross-blockchain applications can benefit from Rosetta’s standard format, reducing the amount of code developers need to write.


Rosetta is open source, meaning anyone can contribute to its growth and development. Ventures such as Filecoin, Celo, Near, and Oasis have already added to its documentation.



“Rosetta is an exciting development in the cryptocurrency space that helps establish a standard API for integrating and building applications on blockchain networks,” explained Celo co-founder Marek Olszewski in a statement. “The cLabs team is excited to see applications use a common interface via Rosetta to build not only on Celo, but on other blockchains as well, opening up the potential for new developers and businesses to join our growing industry.”




Coinbase said that in the future, it’s aiming to support a full “ecosystem of Rosetta interfaces” for major blockchains like Bitcoin and Ethereum.



Today’s product news is already receiving plaudits from crypto audiences. That stands in contrast with a Coinbase move from earlier this month when the mega-exchange announced it was looking to issue its blockchain analytics software to government agencies such as the Drug Enforcement Agency (DEA) and the Internal Revenue Service (IRS).

Huobi launches bi-quarterly Bitcoin futures with 125x leverage

          

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Crypto exchange Huobi is among the largest players in the derivatives market.




Just a week after crypto exchange Binance started offering quarterly futures, rival exchange Huobi today introduced bi-quarterly futures. Touché!


A futures contract is a bet on whether the price of a cryptocurrency will rise or fall by a certain point, in Huobi’s case every six weeks. If the bet is correct, the person who made it wins. If not, they lose, and the money goes to the person they signed the contract with.



Huobi’s bi-quarterly futures product supports nine cryptocurrencies, among them Bitcoin, Ethereum and Litecoin, along with 36 trading pairs. Huobi’s futures platform already supports weekly, bi-weekly and quarterly futures contracts. 



Huobi’s offering goes live the day after Huobi Futures launched version 4.2.0 of its platform. It also adds a feature called “locked margin optimization,” which lets users make the most of their money by lowering trading costs and reducing lag.



Huobi offers 125x leverage



People can also leverage trades by up to 125 times—an extremely high number that comes with a considerable amount of risk. Huobi wants to “provide users with wider choices and lower principal cost to open a position.” 



“The higher the leverage multiples they apply, the less principal cost is required to open the position, so as to potentially earn greater profits,” it wrote. 



Huobi is one of the stalwarts in the crypto-derivatives industry. Last quarter, it traded $438 billion, according to coin metrics firm TokenInsight. In March, April and May, Huobi had the largest volumes for derivatives trading among top exchanges, followed by OKEx and Binance, according to crypto analytics firm CryptoCompare.


Binance, the newcomer that launched in late 2019, is hot on Huobi’s heels. Huobi has been solidifying its market share ever since it launched its derivatives platform in early 2018 (then called Huobi DM), but Binance is quickly gaining. Between April and May, Binance’s volume increased by 58%; Huobi increased by just 29%.

##Bitcoin is becoming more trustworthy than big banks, says survey

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The number of people who trust Bitcoin over big banks has shot up by 29% over the last three years, while millennials are flocking to Bitcoin.




In brief


A new survey shows that the number of people who trust Bitcoin over big banks has increased over the past three years.


Millennials are leading adoption of Bitcoin, with 44% expecting to buy some in the next five years.


Over 45% of respondents preferred Bitcoin over stocks, real estate and gold.



People around the world are increasingly trusting Bitcoin over big banks, according to a new survey conducted by fintech news site The Tokenist. The survey, which polled 4,852 participants across 17 countries, found that 47% of respondents trust Bitcoin over big banks, an increase of 29% in the past three years.



Millennials embrace Bitcoin


The survey also showed a striking generation gap when it comes to Bitcoin and the banks. While over half (51%) of millennials trust Bitcoin over big banks, an increase of 24% over 2017, over nine in ten (93%) of over-65s trust big banks over Bitcoin.



The over-65s are wary of Bitcoin in general, with half of those polled thinking that it’s a bubble, versus less than a quarter (24%) of millennials.



Millennials’ embrace of Bitcoin is partly down to increased familiarity; 78% of millennials are “somewhat” familiar with Bitcoin, versus 61% of total respondents, and 14% of them have owned Bitcoin. In the next five years, 44% of millennials expect to buy some Bitcoin




Not surprisingly, then, the survey also found that 59% of millennials are confident that Bitcoin will see mass adoption within the next 10 years, and that most people around the world will likely be using it by that time.



Confidence in Bitcoin up across the board
While millennials may be leading the way in Bitcoin adoption, the survey found “increased knowledge of, and growing confidence in, Bitcoin among all age and gender groups surveyed,” its writers stated.




Six in ten (60%) of those polled felt that Bitcoin is a positive innovation in financial technology, an increase of 27% in three years. And over 45% of respondents preferred Bitcoin over stocks, real estate and gold.



“Three years ago, many of the largest BTC brokers were relatively new and were therefore accorded a low level of trust,” said the report’s writers. “Now, there appears to be an appreciation of the maturity, and stability, of these providers.” 



With stocks and shares taking a beating in the wake of the coronavirus pandemic and subsequent lockdown, some Bitcoin advocates are arguing that this is the cryptocurrency’s moment. Though with Bitcoin’s price fluctuating in recent days, it clearly has some way to go yet.

##Chinese state media takes aim at Binance while Huobi looks on

      


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China's state media frequently functions as bellwether for government policy, with its reporting prompting changes in policy from companies.



In brief


Reporting in Chinese state media has taken a markedly different tone on crypto exhanges Binance and Huobi.


Chinese state media often functions as a bellwether for the government's views, with its reporting prompting changes of policy by companies.


While Binance exited China in 2018, Huobi has opened a Communist Party of China branch within the company.






Two of the world’s biggest crypto exchanges are receiving markedly different coverage from Chinese state media. Binance, which exited the country in 2018, is facing negative reporting from local media outlets. By contrast, Huobi, which has opened a government relations branch, is being lauded.



State media outlet China National Radio (CNR) recently reported on Binance's accessibility in China, while also highlighting the China Internet Finance Association's recent "Risk Tips for Participating in Speculation of Overseas Virtual Currency Trading Platforms." CNR noted that the "risk tips" emphasized the dangers of virtual currency transactions and ICO trading—both illegal in China since 2017—while highlighting recent security breaches suffered by Binance. 




The "risk tips", CNR reported, emphasized that some virtual currency trading platforms have set up servers overseas to continue to engage in related activities, posing a risk to users.



Binance hasn’t had a corporate registration in China since 2018, when the company exited the country, citing a “hostile regulatory environment”. The location of Binance’s corporate domicile is currently unknown, with CEO Changpeng Zhao claiming that the company doesn't have an office.China's state media is a bellwether for government policy, with its reporting frequently prompting changes in policy from foreign companies. In 2013, state media targeted Apple, with the company eventually capitulating to government demands to open up a data center within the country (making user data accessible to local law enforcement).


Huobi's charm offensive


Earlier this week, Binance's rival exchange Huobi was also the subject of a report from Chinese state media—but China News took a markedly different tone to CNR's reporting on Binance. Huobi was highlighted as an important part of the tech cluster in the recently established Hainan free trade zone.




In its relations with the Chinese government, Huobi has taken a different approach to its rival Binance. In 2018 it opened a Communist Party of China branch (a government liaison and lobbying office) within the company, a move that many organizations undertake to signal regulatory compliance and build a sense of legitimacy.



The CPC’s charter says that any enterprise in China having at least three party members as employees must establish its own party branch; setting up a party branch in Huobi demonstrates the exchange's loyalty to the Party and willingness to work under its supervision.


Huobi is also a stakeholder in China’s national Blockchain Service Network as one of the 14 founding members of the platform, and has participated in China’s Belt and Road initiative. 

The question for exchanges in the region is: which approach will ultimately bear fruit?

##Binance goes live with quarterly Bitcoin futures

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Crypto exchange Binance has expanded its futures offering to support quarterly Bitcoin futures. But it warns, it could be risky.



In brief


Binance has launched quarterly futures contracts.


This marks its latest expansion into the derivatives market.


Binance has quickly gained market share.




Crypto exchange Binance today launched quarterly Bitcoin futures.  The addition marks Binance’s latest expansion into the crypto-derivatives market, an area in which the firm is quickly gaining market share. 


Futures trading allows traders to bet on the expected price of Bitcoin at a moment in the future. Traders can go "long," expecting the price to go up, or "short," for it to go down.



Binance has offered futures contracts since 2019, but these were perpetual contracts that can mature (end) at any point. By comparison, quarterly futures end on the last Friday of the corresponding three-month period.



Just like the perpetual contracts, the quarterly Bitcoin futures contracts offer leverage of up to 125x. This allows traders to amplify their trades—increasing their potential winnings and losses.



Binance gets into derivatives


“We are a late-comer to derivatives,” Binance CEO Changpeng Zhao told Decrypt. But the giant crypto exchange has quickly muscled its way to the front. A report by CryptoCompare last week showed that derivatives volumes on Binance are the third-largest in the industry, behind Huobi and OKEx. In the last 24 hours, $2.42 billion was traded on its futures exchange, also ranking third in the market, according to data from Skew Analytics.



In May, Binance’s derivatives share increased by 58% compared to the previous month, according to CryptoCompare, and Binance reports a 217% increase in institutional client volumes compared to the previous quarter. 



Zhao said that Binance offers institutional investors its big name brand, security and lower fees. “Binance is one of the strongest brands in the industry already, and also has the highest number of VIP and institutional investors in the market,” he said, adding, “We invested heavily in security to prevent risks of hacking and also have a SAFU fund to ensure funds are safe in Binance.” SAFU is one of Zhao’s favorite phrases. It means that funds are insured in case of a hack. 



Zhao also touted Binance’s stability, both “in terms of both system stability and available liquidity.” In "high volatility days where other platforms suffered from system stability and/or liquidity crunches, Binance performed with little issues," he said.


In February, Binance's spot exchange struggled with performance issues when Bitcoin's price rose, even though the exchange was "stress-tested...like crazy in our test environments,” Zhao said at the time. Binance suffered no such problems later in the year, even though peak trading volumes have surpassed levels observed at the time of the performance troubles.

#New film to show how the Winklevoss twins became Bitcoin Billionaires

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Cameron and Tyler Winklevoss are co-financing a film based on Ben Mezrich's Bitcoin Billionaires—the follow-up to the book that became The Social Network.



In brief


The Winklevoss twins are co-financing a film based on Ben Mezrich's book Bitcoin Billionaires.
Bitcoin Billionaires continues on from Mezrich's The Accidental Billionaires, which was adapted into 2010 film The Social Network, directed by David Fincher.



The new film will explore how Cameron and Tyler Winklevoss used money from a settlement with Facebook to make early investments in Bitcoin.


The Winklevoss twins will return to the silver screen in a film adaptation of Bitcoin Billionaires, author Ben Mezrich's follow-up to The Accidental Billionaires—the book that became 2010 film The Social Network.


According to a report from Deadline, Cameron and Tyler Winklevoss will co-finance the film, which picks up the story where The Accidental Billionaires left off—with the twins receiving a $65 million settlement from Facebook, which they went on to invest in Bitcoin during the early years of the cryptocurrency boom.




"Bitcoin is coming to the silver screen," Tyler Winklevoss tweeted as the news broke.



After The Social Network


Mezrich's The Accidental Billionaires, and the subsequent film adaptation, The Social Network, focused on Mark Zuckerberg's creation of Facebook. Cameron and Tyler Winklevoss took on Zuckerberg in a legal battle over code that he worked on for their rival Harvard social network, ConnectU; the twins subsequently won a $65 million settlement from Facebook, paid in cash and shares.


Bitcoin Billionaires, a New York Times bestseller, follows the Winklevoss twins as they're ostracized from Silicon Valley due to their public battle with Facebook, struggling to find firms who'll accept them as investors—before finally betting it big on Bitcoin.



The pair invest in the risky new venture of cryptocurrencies, encountering figures from the early days of Bitcoin such as Charlie Shrem and Erik Voorhees, and enduring shocks such as the Mt.Gox hack and subsequent crash of Bitcoin. Their perseverance pays off when Bitcoin's price surges and they launch their own venture, the crypto exchange Gemini.





Mezrich described Bitcoin Billionaires as a "second act" for the twins, with The Accidental Billionaires and The Social Network having cemented a view of them as privileged jocks that was "in need of revising." With Facebook now dominating the Internet and embroiled in scandals, Mezrich argued, "Zuckerberg's and the twins' roles as rebels and Evil Empire seem to have been reversed."



Who's making Bitcoin Billionaires?



The Winklevoss twins will team up with production company Stampede Ventures on the adaptation. In a twist worthy of Hollywood, Stampede Ventures is backed by former Facebook CFO and San Francisco 49ers co-owner Gideon Yu, who was CFO of Facebook at the time the company settled with the Winklevoss brothers.




The Winklevosses subsequently contested the settlement in court, asking a judge to undo their settlement with the company, arguing that they deserved more money. Although their initial settlement was worth $65 million, it appreciated in value to nearly $200 million as Facebook secured more funding rounds including from Asia’s richest man Li Ka Shing. After "careful consideration," however, the twins abandoned their attempt to undo the settlement.



Who could play the Winklevoss twins?

In The Social Network, director David Fincher cast Armie Hammer as both Winklevoss twins opposite Jesse Eisenberg as Zuckerberg; visual effects were used to enable Hammer to play both Tyler and Cameron.

Blockstream launches Bitcoin OTC trading platform in Japan

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Dubbed Settlenet, the new platform promises to minimize the risks of over-the-counter trading by using atomic swaps.





In brief:


Blockstream, Digital Garage and Tokyo Tanshi have launched a non-custodial digital asset settlement platform.


Dubbed Settlenet, it promises to minimize the risks and paperwork associated with over-the-counter trading.


Currently, the platform supports Blockstream’s Liquid Bitcoin and Crypto Garage’s token that represents the Japanese Yen.




Blockchain firms Blockstream and Digital Garage, as well as financial services company Tokyo Tanshi, have announced the launch of Settlenet—a non-custodial digital asset settlement platform designed to help foreign enterprises more easily conduct their business in Japan.



Blockstream is a Canadian blockchain services company known for its work on the Bitcoin Lightning Network and its Bitcoin solutions like the Liquid Network. Liquid works by moving the Bitcoin on a “sidechain”—think a blockchain running in parallel, but one that’s faster—which settles transactions in just two minutes.



Settlenet is built on the Liquid Network. At launch, the platform supports trading between Blockstream’s Liquid version of Bitcoin (L-BTC) and Crypto Garage’s token that represents the Japanese Yen (JPYS).



According to the developers, Settlenet is using atomic swaps (where money is transferred from one blockchain to another) to mitigate the risks usually associated with over-the-counter (OTC) transactions and is regulatory compliant.



“The Settlenet platform operates within a regulatory sandbox program set up by the Government of Japan and is open to exchanges, OTC desks, brokers, asset managers, and other financial institutions from around the world,” said the announcement, published on June 8.



The developers added that a number of “global OTC firms and Japanese exchange platforms” have already signed up to use Settlenet, but it did not specify which ones.



The platform could allow overseas businesses to more easily gain a foothold in the Japanese market.



“Entering the Japanese Bitcoin market has traditionally been a challenge for overseas companies due to the high costs involved in establishing a legal presence in the country. Settlenet makes things considerably easier thanks to the introduction of JPYS,” stated the announcement.



After a transaction is made, companies will be receiving the fiat-backed JPYS tokens instead of a physical settlement to a Japanese bank account, enabling “Settlenet clients from anywhere in the world to quickly and easily start accepting settlements in Japanese yen in a cost-effective and compliant manner,” the announcement explained.



In the future, Settlenet will support more tokens and trading pairs such as Tether (USDT) and L-CAD—a stablecoin pegged to the Canadian dollar.

##Why Tether has printed $5 billion USDT this Year

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Tether CTO Paolo Ardoino says over-the-counter trading desks and crypto exchanges want dollars on hand, and this is driving up demand.




In brief:

Bitfinex and Tether CTO Paolo Ardoino speaks to Coin Metrics co-founder Nic Carter about Tether.


He explains why $5 billion of Tether has been printed since January, and whether it could reach $100 billion.


He also looks at the exodus of Bitcoin from crypto exchange Bitfinex.




Tether and Bitfinex CTO Paolo Ardoino today revealed why Tether has minted $5 billion in the last six months, more than at any point in the company’s history. After slowly climbing the market cap rankings, Tether has now risen above XRP to reach third place in the crypto rankings, with a market cap of $9 billion. But what’s behind this massive surge in demand?


Speaking on the “On The Brink With Castle Island” podcast, Ardonio said demand has been driven by exchanges craving cash, especially after the market crashed in mid-March.




“On 12 and 13 of March, when there was that huge drop—50 percent in Bitcoin and other major currencies—we have seen people being stuck on fiat on-ramp exchanges because they couldn’t move fast enough their dollars in order to exploit the market conditions or protect themselves,” he explained.


He suggested that the inflow of money wasn’t coming from outside the cryptocurrency sector but from exchanges who wanted more Tether.



I believe that Tether is absorbing part of the cash wealth that is sitting in cash in bank accounts on many other exchanges,” he said, adding, “We have seen OTC desks that have started dealing massively in Tether as well.”


Ardoino also spoke about the exchange’s inflows and outflows, its banking situation and whether Tether can grow to $200 billion.




For context, crypto exchange Bitfinex and stablecoin issuer Tether are two separate companies, run by the same people. Tether is responsible for issuing the Tether (USDT) stablecoin, which now has a market cap of $9 billion. Each dollar stablecoin is purportedly backed up by Tether’s reserves, although the company has never produced an audit to guarantee this.


Bitcoin flowing out of Bitfinex


In the interview, Ardoino was asked why large amounts of Bitcoin (BTC) had been flowing out of the Bitfinex exchange, while big amounts of Ethereum (ETH) flooded back in—a phenomenon that had many market commentators scratching their heads.




Ardoino explained that several large over-the-counter purchases were the reason for the sudden liquidity in its Bitcoin holdings.



He also noted that for months, if not years, the Bitcoin price on Bitfinex had been higher than on other exchanges, but that this has reversed since March 12 (when there was a large crash in the price of Bitcoin and traditional currencies). He suggested this lead to more arbitrage opportunities, where traders buy Bitcoin for a lower price on Bitfinex and sell on other exchanges for a profit.




“On the Ethereum side, we have seen a really considerable inflow, more than $1 million Ethereum in the last two or three months,” Ardoino said before suggesting it could be in preparation for Ethereum 2.0.




The road to $100 billion



Ardonio was also asked about Tether’s scalability, and how it would work with banks if the project’s market cap kept growing.



“It’s theoretically not complicated to go from $0 to $200, $300 billion but if you surpass $100 billion and more, it becomes more complex to deal with banks,” said Ardoino.




Tether has had difficulties in the past with its banking partners. It lost $750 million of its reserves when accounts in a Panamanian bank were seized by law enforcement. To solve this, it created a cryptocurrency designed to work as a loan from the crypto community to cover these losses, which it intends to pay back. It has also stopped paying dividends to its shareholders.




“I believe that if we have to go to $100 billion then it would require probably a tier one bank to help us in the enterprise. The more you grow, the more you need diversification, and the more you need to step up the game and deal with the much bigger banks each time,” he said. But there are clouds gathering in the global economy that could scupper Tether’s expansion plans.


The specter of negative interest rates—where banks charge depositors to hold their money—has been mooted by several central banks recently. If implemented, Tether would have to pay banks holding its cash reserves. “It would be possible to still break even in that situation. To still maintain the capital and super safe investments. I think that it is harder if you have $100 billion, but if you have $9 billion it’s definitely something that is achievable,” he said.


Perhaps there is a limit to Tether’s rapid growth after all.

##US Crypto Exchanges Are Booming Despite Economic Fallout

         

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Several crypto exchanges are seeing a massive growth in retail and institutional investors, particularly in the US.
The crypto industry is persistently moving forward despite the current situation. Several exchanges have been seeing a relentless growth in retail investors.



US-based Square’s Cash App reported its record-breaking financial quarter at the beginning of the year. A quarter of the company’s revenue was generated by the purchases of Bitcoin alone. Many other exchanges also saw the influx of retail investors. London-based financial services firm eToro started offering crypto trading services in April last year. Since then, the platform has gravitated a larger customer base comprising of crypto-investors, particularly from the US. eToro reported a 300-400% increase in crypto trading volume in the US since December, followed by a 270% increase in revenue. eToro’s Managing Director (USA), Guy Hirsch told Decrypt:

“We see [legitimization] across the board. The entire industry has seen a boom since the beginning of the year. Everything that’s happened with COVID-19, we see very strong resilience in cryptoassets, particularly Bitcoin, and an increase in interest from web searches, family and friends asking about it. I wouldn’t be surprised to see similar growth across the industry.”




The rising interest of retail investors seems to have created a ripple effect on institutional investors. Binance has seen steady growth in the institutional investors trading on the platform, with a 47% upswing of clients since 2019

##Bitcoin Likely to Reach All-Time High This Year: Bloomberg

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Bitcoin will reach its all-time peak by the end of 2020: Bloomberg report.
A report by Bloomberg on its outlook of the crypto market, explains how this year the largest cryptocurrency by market cap may reach its all-time peak of USD 20,000.




Mike McGlone, a Bloomberg technical strategist points out the fluctuations in Bitcoin’s price post and pre-halving. He said that the fluctuations seem akin to the ones in 2016, indicating a three-year cyclical pattern hitting the milestone mark by the end of 2020.



After the 60% decline in 2014, Bitcoin reached its peak at the end of 2016 matching the one reached in 2013. Four years later in 2020, two years after a 75% decline in 2018, if Bitcoin is following a similar trajectory as 2016, it will reach its peak by the end of 2020.



Moreover, Bloomberg brought in the factor of gold and Bitcoin having the same macroeconomic factors affecting their price. This means that with gold about to reach its peak since 1980, Bitcoin will experience a similar increase due to the same underlying factors.

##Powerful Bitcoin and Crypto Proponent Hester Peirce Nominated to Second Term at SEC

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Popular Bitcoin (BTC) and crypto advocate Hester Peirce may retain her position as commissioner of the U.S. Securities and Exchange Commission (SEC).


According to a White House press release, President Trump has nominated Peirce to serve a second term at the SEC.



Peirce, a lawyer who specializes in financial market regulation, was sworn into office in January of 2018. Her current term is expiring on Friday, but can continue pending a review of her nomination.




She will serve as SEC commissioner until at least 2025 if she gets backing from the Senate, which confirms nominations for key federal officials.




Peirce became known as the “crypto mom” due to her ardent support for digital currencies. In July of 2018, she publicly dissented on the SEC’s decision to reject a Bitcoin exchange-traded fund application submitted by the Winklevoss twins Tyler and Cameron.



In February, Peirce said the SEC should give crypto startups that conduct token sales a three-year safe harbor period before their digital assets are subject to securities regulations. Peirce believes this will give crypto startups ample time to prove their tokens are legal.


The proposal came after the SEC flagged numerous initial coin offerings (ICOs) for illegally selling crypto assets as unregistered securities.

##Swiss Bank Says Goldman Sachs Is Wrong About Bitcoin (BTC), Predicts Crypto ‘Paradigm Shift’ Is Coming

          

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A Swiss Bank is responding to a recent report from Goldman Sachs that declares Bitcoin (BTC) is neither an asset class nor a suitable investment.



Swissquote’s head of digital assets Chris Thomas released a point-by-point rebuttal to the report. He begins with a comparison between Bitcoin’s volatility and wild swings in traditional markets.


“Absolutely, Bitcoin did fall 37% on March 12, 2020. And just one month later, oil markets plunged 333% in the space of 24 hours, nearly 10x a greater drop, touching a low of minus $40 per barrel at one point. In December 2019, Goldman Sachs predicted the average oil price through 2020 would be $63 per barrel.”



Regarding Goldman’s assertion that investments should not be reduced to a need for others to pay a higher price, Thomas responds that traditional markets also function on an assumption of capital appreciation.



“The ultimate decision to buy (or sell) comes down to whether we believe the price will go higher (lower) and hence whether someone else is willing to pay a higher (lower) price for that investment…



Bitcoin, and select others, are the driving force behind the paradigm shift which is happening. Goldman Sachs is ignoring the strong foundations of this emerging asset class based on cryptographic principles and a world where many, if not all, assets will be tokenised, and trading them will be democratised.”




As for the long-standing narrative that Bitcoin is primarily a tool for criminals, Thomas points out that Chainalysis concluded in a January 2020 report that only 0.08% of crypto transactions originate from the darknet markets and that criminal activity represented just 1.1% of total activity.



Bernard Madoff’s $65 billion scam in the fiat world dwarfs scams in the cryptocurrency world in terms of magnitude, he contends. Lastly, Thomas says the fact that major financial institutions such as Fidelity Investments and JP Morgan are confident enough to venture into the space shows that financial institutions do believe that cryptocurrency has a future.



Although security and the management of private keys remain challenges in the cryptocurrency space, Thomas argues that banks such as Swissquote maintain security and can also solicit deposit insurance in case of hacks.