Category: Cryptocurrency

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The Philippines Securities and Exchange Commission (SEC) announced on Monday its collaboration with the National Telecommunications Commission (NTC) to impede local traders’ access to Binance, the world’s largest cryptocurrency exchange by daily trading volumes.

Regulators in the Philippines are pursuing measures to prevent local traders from accessing Binance. The SEC stated on Monday that it has initiated efforts to block access to the cryptocurrency exchange due to its lack of the required regulatory license to operate in the jurisdiction. The agency had requested assistance from the NTC two weeks before blocking web pages associated with Binance.

According to the SEC, Binance has been actively running promotional campaigns on social media to attract Filipino investors to engage in trading activities using its platforms. However, the exchange has not obtained the necessary license from regulators to solicit investments from the public or to operate a securities exchange for buying and selling securities.

The recent actions taken by regulators in the Philippines to limit access to the trading platform are not unexpected. Last autumn, the country’s SEC issued warnings indicating its intention to block Binance due to its failure to obtain approval to offer investment products to residents of the Philippines.

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A year ago, the cryptocurrency industry was grappling with layoffs and regulatory challenges, while trading activity had significantly dwindled. Fast forward to 2024, and the narrative has dramatically shifted from doom and gloom to ETF-fueled optimism, with Coinbase (NASDAQ:COIN) emerging as a standout performer. The company’s stock has surged by nearly 70% this year to approximately $265, garnering praise from analysts at JPMorgan.

Reflecting on previous crypto bull markets, it’s worth noting that the industry’s highs and lows can be subject to exaggeration. Coinbase CEO Brian Armstrong has consistently emphasized that both the downturns and upswings in crypto markets are often overstated. This sentiment holds not only for crypto but for markets in general.

As for Coinbase, recent developments have been overwhelmingly positive. The company’s stock rally, coupled with a renewed focus on product excellence from its leadership, has garnered widespread attention. Armstrong’s shift away from cultural controversies and towards product enhancement has been particularly noteworthy. Coinbase’s role as a Bitcoin custodian for institutional giants like BlackRock and Fidelity, along with the success of its Base blockchain, has further solidified its position in the market.

JPMorgan’s bullish report, which includes a $300 price target for Coinbase, highlights the growth potential in the exchange and custody services offered by the company. Additionally, the report anticipates Coinbase’s involvement in the evolving landscape of blockchain use cases. However, it’s essential to temper this optimism with a dose of reality.

While Coinbase is indeed innovating in blockchain services, regulatory hurdles, particularly from the SEC, pose significant challenges. Thinning margins constrain the profitability of Coinbase’s exchange and custody services, while regulatory constraints hinder the monetization of blockchain-related offerings like Base.

Nevertheless, JPMorgan’s analysts spotlight one area of Coinbase’s business with substantial growth potential—the offshore derivatives platform, which is reportedly scaling rapidly. This segment represents a lucrative opportunity for Coinbase, as it caters to traders seeking highly leveraged positions. In the short term, this aspect of Coinbase’s business warrants close observation.

In summary, while JPMorgan’s optimism towards Coinbase is justified in some respects, it’s crucial to maintain a balanced perspective considering the regulatory and operational challenges inherent in the cryptocurrency industry.

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Coinbase Global (NASDAQ:COIN) shares have seen a remarkable 68% surge since February 23, closely tracking Bitcoin’s 37% ascent. As the halving date for Bitcoin approaches on April 17, COIN stock is poised to continue its upward trajectory alongside Bitcoin. This surge has also inflated COIN’s put option premiums, making them an appealing prospect for short-put strategies.

The impending Bitcoin halving will reduce the number of BTC coins that miners can generate per successful hashing attempt. Scheduled roughly every four years, analysts anticipate the next halving to occur on April 17. With miners needing updated equipment and a diminished supply of Bitcoins, this event is expected to drive Bitcoin prices higher. Consequently, anticipation of this event has driven Bitcoin’s price surge.

Coinbase Global is likely benefitting from heightened cryptocurrency trading activity this quarter, buoyed further by the introduction of ETF funds trading in Bitcoin. So, how high can COIN stock climb?

Analysts suggest Coinbase is poised to generate significant free cash flow, with revenue projections for the year reaching as high as $4.79 billion. Based on estimated operating cash flow margins, this could lead to a considerable rise in cash flow compared to previous estimates.

Using a 1.5% free cash flow yield metric, COIN stock valuation could reach $106.66 billion, implying a price target of at least $403 per share. Consequently, shorting near-term put options with their elevated premiums appears to be a lucrative move.

Shorting put options offers an immediate yield, particularly for out-of-the-money strike prices. For instance, with a strike price 10% out-of-the-money, investors could achieve a 3.25% immediate yield. Similar opportunities exist for nearby expiry periods, such as April 12, presenting substantial potential yields for various strike prices.

However, it’s crucial to acknowledge the risks involved, especially given the potential volatility in the stock. While this strategy can yield significant gains for COIN stockholders, a reversal in stock performance could lead to unrealized losses.

In summary, shorting put options on COIN stock presents an attractive opportunity for investors confident in the stock’s continued ascent. Nevertheless, prudent risk management is essential to navigate potential market fluctuations.

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Bitcoin has bounced back above the $70,000 mark, signaling resilience among cryptocurrency enthusiasts in the face of recent outflows from US exchange-traded funds (ETFs).

On Monday, most digital assets experienced gains, with Bitcoin surging as much as 5.8% to reach $70,014, marking its return to the $70,000 level after more than a week. Ether also saw an increase of around 5%, while Solana and Dogecoin recorded gains of over 4%.

Last week, approximately $900 million was withdrawn from these ETFs, reflecting ongoing outflows from the Grayscale Bitcoin Trust, as well as reduced subscriptions for offerings from BlackRock Inc. and Fidelity Investment. This trend resulted in one of the worst-performing weeks of the year for the group of 10 funds since their launch in January.

Nathanaël Cohen, co-founder at digital-asset hedge fund INDIGO Fund, noted, “Even though ETF inflows have hit a drag, order books are loaded on the bid side around the 60k area, showing that the market is eager to buy the dip.” He emphasized the importance of obtaining liquidity at lower levels to fuel upward momentum.

The recent demand for Bitcoin ETFs has been a significant factor driving the cryptocurrency’s historic rally this year. Strong inflows into these funds have fueled optimism about the asset class’s exponential growth among a broader range of investors. However, last week’s substantial outflows prompted traders to hedge against lower prices and led to significant liquidations in leveraged bullish positions in the crypto futures market.

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The cryptocurrency market concluded the week with a downward trend, witnessing Bitcoin (BTC) slipping below $64,000 again, while altcoins also recorded losses amidst profit-taking activities by traders preparing for the next significant uptrend.

Similarly, stocks faced pressure after a Thursday rally pushed all three major indexes to new record highs, driven by expectations of lower interest rates. At the market close, the S&P and Dow finished in negative territory, down by 0.14% and 0.77%, respectively, while the Nasdaq managed to recover from losses, ending the day up by 0.16%.

Despite stock investors celebrating the new record highs, crypto investors took a subtle jab at the achievement. While Bitcoin has experienced a more than 13% decline from its recent peak, the S&P has only seen a roughly 0.5% downturn. It’s worth noting that since 2014, Bitcoin’s price has surged by over 29,000%, while the S&P has risen by 195%, with gold’s price witnessing an increase of 91.5% during the same period.

As of the time of writing, BTC is trading at $63,570, marking a 2.3% decline over the 24-hour chart.

Market analyst CryptoChiefs noted, “After Bitcoin continued to bleed throughout yesterday, we saw a nice reaction from the previous week’s Low at $64.6k,” suggesting the formation of an inverse head and shoulders pattern, with resistance seen around the Monday low at $65.6k.

Despite the drop in Bitcoin’s price, Poppe highlighted BlackRock’s consistent inflow in the Spot Bitcoin ETF, indicating continued institutional buying, which signals that the cycle is far from over.

Looking ahead, Rekt Capital outlined the Pre-Halving Retrace, setting up a future Post-Halving Re-Accumulation Range, paving the way for the future Parabolic Upside phase of the cycle.

In the altcoin market, DeXe (DEXE) led with a 21.9% gain, followed by DAO Maker (DAO) with a 16.2% increase, and Aptos (APT) with an 11.5% gain. Conversely, Echelon Prime (PRIME) dropped by 9.3%, while Raydium (RAY) and Flux (FLUX) declined by 8% and 7.7%, respectively.

The overall cryptocurrency market cap stands at $2.43 trillion, with Bitcoin’s dominance rate at 51.7%.

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Worldcoin, a project aimed at empowering users, is rolling out a new feature called “Personal Custody,” which eliminates the option for users to store their biometric data. Under this initiative, individuals signing up for a World ID will no longer have their biometric data stored and encrypted by default. Instead, the data will reside on users’ devices, giving them full control over its usage, including the option to delete it if desired.

The introduction of Personal Custody marks a significant step in Worldcoin’s commitment to privacy and transparency. While the project has always emphasized the protection of users’ biometric data during verification, this new approach aims to build further trust among potential users.

Tiago Sada, Head of Product, Engineering, and Design at Tools for Humanity, the primary software contributor to Worldcoin, emphasized the importance of user control over their data. He stated that while data deletion was previously the default option, the implementation of Personal Custody ensures that users have complete autonomy over their data, thus providing them with greater peace of mind.

Worldcoin’s recent move towards Personal Custody comes amid scrutiny from government agencies and regulators. Despite facing challenges, including a temporary ban in Spain and scrutiny over token distribution, Worldcoin remains committed to enhancing user privacy and security.

Before the rollout of Personal Custody, users had the option to either delete their biometric data immediately after verification or allow Worldcoin to encrypt and store it in secure data stores. With the elimination of the Data Custody option, Personal Custody puts data control firmly in the hands of users.

In addition to Personal Custody, Worldcoin is also increasing transparency by making key components of its Orb software publicly available on GitHub. This move aims to bolster transparency and verifiability, aligning with the project’s commitment to openness and accountability.

By prioritizing user empowerment and transparency, Worldcoin continues to advance its mission of providing a secure and inclusive platform for individuals worldwide.

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Gary Gensler, Chair of the Securities and Exchange Commission (SEC), reiterated his stance on the need for transparency in the crypto markets, suggesting they could benefit from some “disinfectant.”

Speaking at the Columbia Law School conference on Friday, Gensler emphasized the importance of disclosures in financial markets, including those related to climate and cyber risks. He argued that disclosures contribute to more efficient markets and safeguard investors’ interests.

In his prepared remarks, Gensler pointed out that some participants in crypto securities markets seek to evade registration requirements, resulting in a lack of mandatory disclosure. He suggested that introducing more transparency could improve the integrity of the crypto markets.

Gensler has consistently stressed that crypto firms must adhere to the same regulatory standards as traditional financial institutions. Over the past year, the SEC has taken action against platforms like Coinbase and Kraken for allegedly operating without proper registration.

The SEC’s recent focus on disclosures extends beyond crypto, with Gensler highlighting the importance of disclosures related to executive compensation, climate risks, and cyber risks. Earlier this month, the SEC voted to adopt rules requiring companies to disclose climate-related risks.

During a question and answer session, Gensler emphasized the role of both the SEC and the Commodity Futures Trading Commission (CFTC) in regulating crypto. He acknowledged that the agencies have different perspectives on whether certain cryptocurrencies, like ether, should be classified as securities or commodities.

While there appears to be some disagreement between the SEC and the CFTC regarding the classification of ether, Gensler and CFTC Chair Behnam maintain regular communication to ensure effective regulation. Behnam has stated that ether is a commodity, while the SEC’s stance on the matter remains less clear.

Behnam has also raised concerns that conflicting classifications could create compliance challenges for market participants. If the SEC were to classify ether as a security, it would potentially conflict with CFTC regulations, impacting registrants who list ether as a futures contract.

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Alex Thorn, head of firmwide research at Galaxy Digital, suggests that the approval of spot Ethereum exchange-traded funds (ETFs) in May is now highly doubtful. Recent developments, including SEC subpoenas and a lack of engagement, contribute to this skepticism, Thorn stated in a note on Friday.

Reports indicating that the Securities and Exchange Commission (SEC) has issued subpoenas to crypto firms regarding their ties to the Ethereum Foundation, combined with the SEC’s apparent disinterest in engaging with ETF applicants just two months before the initial deadline, have raised significant doubts about approval in May, according to Thorn.

Fortune’s recent report highlights the SEC’s active legal efforts to classify ether (ETH) as a security, citing subpoenas received by U.S. companies as part of an investigation. Additionally, The Block reported that the Ethereum Foundation received a confidential inquiry from a state authority, leading to the removal of the “warrant canary” from its website.

Thorn, a former Fidelity Investments veteran, speculates that the SEC’s interest in crypto firms’ interactions with the Ethereum Foundation may involve investigating whether Ethereum’s initial coin offering (ICO) in 2014 constituted an unregistered securities offering. He suggests that while the SEC may differentiate between the ICO and the current secondary trading of ETH, any enforcement action against the Ethereum Foundation after almost a decade would be highly irregular.

SEC Chairman Gary Gensler has declined to comment on whether the agency considers ETH a security. However, the SEC reportedly views Ethereum’s 2022 “Merge” upgrade as potentially strengthening the argument that ETH is a security due to the network’s transition to proof-of-stake. Despite this, the SEC permitted the launch of several futures-based Ethereum ETFs in 2023, a year after Ethereum transitioned to PoS.

Thorn argues that if the SEC pursues allegations of securities violations against ETH or the Ethereum Foundation, it would tread on uncertain legal ground and potentially impact an industry that has existed for over a decade.

This perspective aligns with market experts’ doubts about the approval of a spot Ethereum ETF by May. Bitwise CIO Matt Hougan has suggested that delaying approval could be advantageous, allowing Wall Street to digest spot bitcoin ETFs before focusing on new ones. He believes that a later approval might attract even more assets.

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Artificial intelligence startup Anthropic, a competitor of OpenAI, seeks to divest shares previously held by the now-defunct crypto exchange FTX. However, reports indicate that Saudi Arabian investors are not being entertained as potential buyers, as per anonymous sources.

Anthropic currently possesses an 8% stake from FTX, valued at over $1 billion. CNBC’s report, relying on undisclosed informants, suggests that Anthropic is in the market for a buyer to acquire the shares previously owned by FTX but has explicitly excluded Saudi investors from consideration.

According to CNBC’s sources, Anthropic’s decision to bypass Saudi investments is grounded in concerns regarding national security. Reportedly, the company’s executives are in the process of assembling a pool of potential backers while excluding Saudi financiers.

Three years ago, FTX acquired shares in Anthropic for $500 million. Now, the 8% stake in the esteemed AI startup has doubled in value. FTX’s liquidation of Anthropic shares is part of its bankruptcy proceedings, with proceeds aimed at compensating clients affected by the exchange’s collapse.

The report indicates that the transaction is progressing and is anticipated to conclude within the next few weeks, as mentioned by undisclosed sources.

Furthermore, Anthropic is contemplating selling FTX’s stake to alternative sovereign wealth funds, notably including the United Arab Emirates-based Mubadala. The latter has exhibited interest in acquiring Anthropic shares, as per the same report.

In December, Anthropic commanded a valuation of $18.4 billion. Subsequently, a judge sanctioned FTX’s proposal to offload its shares in the AI enterprise in February.

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WisdomTree has achieved regulatory clearance from the New York State Department of Financial Services (DFS) to operate its digital asset business in the state, placing it among a select group of entities approved in one of the United States’ most rigorous crypto regulatory environments.

The Bitcoin exchange-traded fund (ETF) issuer obtained a charter to function as a limited-purpose trust company under the New York Banking Law, as announced in a statement on March 22. This charter paves the way for the introduction of its WisdomTree Prime platform in the state.

With this charter, WisdomTree is authorized to engage in fiduciary custody of digital assets, including providing digital wallet services, facilitating stablecoin trading, and managing stablecoin reserves, subject to DFS oversight.

Jonathan Steinberg, WisdomTree’s Founder and CEO, underscored the significance of the license in enabling the firm to offer innovative products while prioritizing customer safeguarding. He emphasized that the New York State Department of Financial Services holds a leading position as a regulator for businesses involved in digital asset activities. Additionally, he highlighted the importance of the well-established trust company charter program, which existed before the emergence of digital assets. This program is founded on rigorous banking regulations, allowing the company to introduce innovative products while ensuring customer protection remains paramount.

New York boasts one of the most stringent crypto regulatory frameworks in the United States, necessitating registration and licensing for crypto-related entities. Over the past year, the state has taken legal action against several crypto platforms, including Gemini and the now-defunct Genesis crypto lender, for breaching local regulations.

WisdomTree Prime Platform

The regulatory approval also sets the stage for the rollout of the WisdomTree Prime platform, which will offer a suite of products within the WisdomTree Prime ecosystem, including the issuance of WisdomTree Gold and Dollar Tokens.

The mobile platform will provide users access to cryptocurrencies, digital gold, and various digital funds, creating an integrated ecosystem for saving, spending, and investing on-chain. Leveraging the firm’s trust charter and fiduciary powers will enhance customer protection, particularly regarding asset storage.

Will Peck, CEO of WisdomTree Digital Trust Company, expressed confidence in the company’s product lineup and responsible growth strategy.

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