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quinta-feira, 1 de outubro de 2020

Blockchain Bites: Dorsey Challenges Coinbase

Also: Kik's court battle concludes, Ethereum miners profit and more
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October 1, 2020
By Daniel Kuhn
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Top shelf

The Australian government is investing big in modern technology, Nasdaq saw its first crypto exchange operator listing and revenues are surging for Ethereum miners amid increased network activity. 

Australia modernizes
Australia will commit A$800 million (US$575 million) to invest in digital technologies as part of its coronavirus recovery plan, Prime Minister Scott Morrison announced Tuesday. The federal plan will see US$256.6 million for a digital identity solution, $419.9 million to fully implement the Modernising Business Registers (MBR) program, $22.2 million for small businesses training to utilize digital technologies and two blockchain pilot programs totalling $6.9 million. “The Plan supports Australia’s economic recovery by removing out-dated regulatory barriers, boosting the capability of small businesses and backs the uptake of technology across the economy,” Morrison said in the announcement. 

Nasdaq launch
Blockchain services firm Diginex has become the first crypto exchange operator to list on Nasdaq . The stock went live Thursday morning under the EQOS ticker symbol, a nod to the firm’s EQUOS.io trading platform. CoinDesk’s Nathan DiCamillo reports Diginex’s back-door listing came through a merger with a special-purpose acquisition company (SPAC). Diginex CEO Richard Byworth said he expects a mix of global retail and institutional investors to buy shares. Over time, he expects the majority of Diginex shareholders to be U.S. investors because of the Nasdaq listing.

Dorsey responds
Twitter CEO Jack Dorsey tweeted his disapproval of Coinbase CEO Brian Armstrong’s mission statement to keep his company free and clear of politics. Dorsey argued that by the very act of being a crypto exchange, Coinbase was always already engaged in politics. "Bitcoin (aka 'crypto') is direct activism against an unverifiable and exclusionary financial system which negatively affects so much of our society. Important to at least acknowledge and connect the related societal issues your customers face daily. This leaves people behind," Dorsey tweeted. Armstrong made waves this week – in and out of crypto – when saying Coinbase, and its employees, should keep work and activism separate. 

Election predictions
Putting stake to their claims, many crypto-political gamblers have cast their vote predicting who might win the contentious U.S. presidential election. CoinDesk markets editor Lawrence Lewitinn looked at the data following this week's first presidential debate and found many are betting incumbent President Donald Trump will lose in November. While bettors on decentralized betting platforms like Augur and futures markets on FTX aren’t as bullish on the challenger, former Vice President Joe Biden, he does have the odds. “Thus what’s true at the time of publication can change on a dime. It is now fewer than five weeks until Election Day. Buckle up!” Lewitinn warns. 

Mining profits
HIVE Blockchain has reported its best-ever quarter, as the mining firm raked in record fees from the frenzied activity in decentralized finance (DeFi) over the summer. The Toronto-listed mining company released its unaudited results Thursday, saying it mined a total of 32,000 ether (ETH) and 121,000 ethereum classic (ETC) in the second fiscal quarter ending Sept. 30. Per CoinDesk's price data, that comes to nearly $11.8 million for mining ether, and a further $664,000 for ethereum classic – approximately $12.4 million at time of writing. The figures represent a near 30% increase from the 25,000 ETH that HIVE mined in the first quarter and a 50% increase in the same quarter in 2019.

Stealth launch
In the latest effort to smooth a path for buttoned-up investors, Talos, an institutional-grade conduit to the crypto ecosystem, is emerging from stealth mode to serve brokers, custodians, exchanges and over-the-counter (OTC) trading desks. The platform started out in 2018 and is backed by an impressive list of investors including Autonomous Partners, Castle Island Ventures, Coinbase Ventures and Initialized Capital. Over the past year or so, Talos has been quietly onboarding a core group of capital market participants, so that the platform can make its debut in a revenue-generating state.



CoinDesk U
Universities are often key to getting new industries off the ground, providing the infrastructure to take paradigm-shifting ideas to the next level. But in blockchain and digital finance technology, how do they measure up?

Introducing CoinDesk U, a ranking of the top 20 schools identified in our research in collaboration with Mousebelt.

During a special CoinDesk Live episode on Oct. 6, we will release the results of the first CoinDesk U ranking. We are inviting students from around the U.S. as well as representatives from student club networks, the crypto industry and leading institutions to discuss traditional academia’s relevance and support for the financial technology poised to fuel Web 3.0.

Watch CoinDesk Live: Can Old Schools Teach New Tech on CoinDesk.com, Twitter and YouTube. Learn more.

Quick bites

At stake

SEC action
Wednesday, a U.S. judge ruled Kik’s $100 million token raise was in violation of securities laws. This is essentially the denouement to a year’s long battle between the Canadian messaging app and the U.S. Securities and Exchange Commission (SEC). Though Kik will have an opportunity to appeal. 

Responding to the SEC’s motion to summary judgment – where the regulator can ask to conclude a trial based on “undisputed material facts,” rather than engaging in a trial – U.S. District Judge Alvin Hellerstein found Kik’s “token distribution event” (TDE) satisfied the three prongs of the Howey Test. 

CoinDesk’s Nikhilesh De reports that initial coin offerings (ICOs) and token sales have been treated as unregistered securities sales for the most part by the SEC. 

Kik became a champion for crypto freedoms when challenging the SEC’s claims that its kin ICO – which the company pursued in lieu of VC backing – was an unregistered securities offering. The firm’s CEO Ted Livingston took a gamble, selling off his messaging business in 2019 and going all in on kin.

"We are getting sued by the SEC. We are going to go to court to fight them. We believe they are wrong," Livingston told CoinDesk in 2019. Several times, and in different ways, he asserted: "It's not that we did something wrong. It's that we did it first."

In a statement, Livingston said he was “disappointed in this ruling,” and that the company is considering its options, including a potential appeal.

Preston Byrne, a CoinDesk columnist and Anderson Kill lawyer, tweeted: “Tl;dr the court shredded Kik. Don’t f*** around with tokens in America.”

Notably, in a separate action, the SEC has ordered Salt Lending to offer investors refunds for its 2017 ICO. Salt has agreed to settle the action and will pay a $250,000 civil penalty to the Commission in the next 10 days.



Join CoinDesk Research for the fourth and final episode of How to Value Bitcoin, our live webinar series covering Bitcoin fundamentals.

On Oct. 6, Delphi Digital head of research Yan Liberman will dive into collective profit and loss taking (CPLT), hodlwaves and the ins and outs of the money analysis. Register to join How to Value Bitcoin: UTXO-Based Fundamentals (Part 2).

Market intel

Crash for cash
Bitcoin faced selling pressure in September as the U.S. dollar rose against major currencies for the first time in six months. The cryptocurrency fell by over 7% over the period – the biggest monthly percentage decline since March, according to CoinDesk's Bitcoin Price Index, when prices fell by nearly 25% as the coronavirus-induced crash in the global equity markets triggered a global dash for cash, sending the dollar higher. Bitcoin's latest monthly decline is again accompanied by an uptick in the greenback.

Eth revenues
Ethereum miners earned over six times more in fees compared to those working on Bitcoin in September. Glassnode data shows Ethereum's total transaction fees stood at an all-time high of $166 million for the month – far more than the $26 million taken in Bitcoin fees. Fee revenue on Ethereum first outpaced Bitcoin's in June, the same month decentralized lender Compound released its governance token and kick-started the DeFi mania, CoinDesk’s Paddy Baker reports. 



invest: etheruem economy
The move to ETH 2.0 will bring the Ethereum network ever closer to fulfilling its original vision: that of a "world computer" that plays host to a parallel, decentralized financial system. Will it be the rocket fuel that takes Ethereum's financial engine mainstream?  

CoinDesk's invest: ethereum economy virtual event Oct. 14 will address the ramifications for investors of the sweeping changes underway within the Ethereum ecosystem. 

Keynote speakers and panelists including Ethereum founder Vitalik Buterin and Commodity Futures Trading Commission Chairman and CEO Heath P. Tarbert will offer deep dives into Ethereum’s adoption of a proof-of-stake consensus mechanism, sharding and other elements of its impending 2.0 upgrade, as well how the new framework impacts the rapidly advancing business of DeFi, stablecoins and decentralized exchanges.

Register to join invest: ethereum economy on Oct. 14. 

Internet 2030

Amy Webb, a quantitative futurist and founder of the strategic foresight firm Future Today Institute, thinks the world can, indeed, get worse. In an interview with CoinDesk, as part of the Internet 2030 series, she lays out her vision for the world where big tech only gets bigger. The conversation has been excerpted below. 

Do you see a genuine way out through distributed technologies that may give people control over their own data? 

I worry about people who never update their passwords – should we entrust them to manage sensitive data? There are complex questions about data hygiene, data governance, compliance, risk. Distributed tech solutions solve some of our problems, but not all.

Few people have an understanding of how data are collected, by whom, for what purpose. There are lots of organizations proposing some kind of “ownership” model, where we individually would “own” our data. What does that mean? 

I want consumers to be much better aware of what data they are generating – that includes the digital emissions they’re releasing without realizing it. Think of all the metadata being generated by our connected devices, the ambient sounds in our homes and offices, our movements and gestures. All of those digital emissions, plus the PIIs collected now by contract tracing apps and biometric scanning systems – I mean, we’re swimming in data. 

What might the cultural or political effects be of an ever-greater consolidated and extractive web? 

We talk about privacy a lot, and journalists certainly write a lot of stories about data sharing, privacy and consolidation within the tech sector. But when it comes to everyday consumers and business leaders, it just doesn’t seem like these are priority issues. We’ll feel the effects when there is litigation, new policy or sweeping policy enacted.

Have an idea for what the future of the internet will look like, reach out to daniel@coindesk.com.

Op-ed

Common cause
Matt Luongo, founder of Thesis, writes that Bitcoiners who stack sats and people who use decentralized finance share common cause. “Bitcoiners who stack sats should take a hard look at the decentralized finance (DeFi) platforms seeing explosive growth on Ethereum. While the optics may call to mind the wild speculation of 2017, the truth is that much of the growth in DeFi is driven by the same sound money principles as stacking,” he writes.
 

Who won #CryptoTwitter?

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Blockchain Bites
A newsletter from CoinDesk
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ALSO: Diginex shares go live on Nasdaq, Twitter's Dorsey responds to Coinbase Anti-Social-Stand
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Oct. 1, 2020
Sponsored by 
By the CoinDesk Markets Team
Edited by Bradley Keoun
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TODAY:
  • Bitcoin (BTC) +0.8% $10,867 | Ether (ETH) +2.0% $367 (@10:35 UTC)
  • Price Point: Bitcoin was higher as U.S. lawmakers revived hopes for a fresh stimulus package and the Tokyo Stock Exchange suffered an all-day outage. 
  • Market Moves: Bitcoin is outperforming pretty much every other asset class this year, with a 50% YTD gain, and analysts are bullish heading into 4Q.
  • Bitcoin Watch: Dollar's strength could pose challenges for near-term price action, CoinDesk's Omkar Godbole writes.  
  • What's Hot: Record ether fees, TRUMP tokens slide, MakerDAO adds Chainlink support, Talos emerges from stealth mode. 

PRICE POINT

Bitcoin was higher to start off the final quarter of 2020, which has been an annus horribilis for the world but a good year for the largest cryptocurrency, up about 50% in the first nine months.  

Lennard Neo, head of research at the cryptocurrency products firm Stack Funds, wrote Thursday in a weekly report that he's seeing "significant buying pressure" at the $10,000 price level and that "further consolidation" is expected "leading up into November." 

In traditional markets, U.S. stock futures were gaining on hopes of a renewed effort to pass a multitrillion-dollar fiscal stimulus package, and the Tokyo Stock Exchange halted trading for the entire day after its worst-ever outage.  

MARKET MOVES

A lot of crypto investors like to think of bitcoin as a bet on higher inflation, or as a futuristic hedge on some imagined economic-armageddon scenario — Gold 2.0, as they say.

Lately it's looking more like Gold 2x: As bitcoin heads into the final months of 2020, the largest cryptocurrency's 2020 investment returns are twice those of the yellow metal. 

Bitcoin gained 50% in the nine months through September, versus gold's 25%, during a year when a global pandemic ravaged economies and prompted central banks to print trillions of dollars. Many investors, while acknowledging that recessions are usually deflationary, say the extra flood of money could eventually send consumer prices spiraling higher.

And bitcoin's performance looks especially stark when compared with the Standard & Poor's 500 Index, which has returned 3.5% this year. A gauge of the bond market's performance is up 19%.




Chart showing year-to-date performance for bitcoin, gold, U.S. stocks and bonds. (By Shuai Hao, CoinDesk Research) 

CoinDesk's Bradley Keoun and Daniel Cawrey rounded up commentary from nine crypto analysts and investors going into the rest of the year. Global conditions could get better, or worse still, but the analysts are pretty bullish.

They may be wrong, and the billionaire investor Warren Buffett has said that bitcoin has "no value," but the tone is strikingly different from the skepticism that many Wall Street analysts now express toward the lofty valuations in stock and bond markets. 

Denis Vinokourov, Bequant: The market is testing the upper bounds of its recent range and, with the absence of fresh macro news flow that could dampen the risk on sentiment, bitcoin may just find enough momentum to break through the $11,000 price level and, more importantly, stay there. Open options interest continues to show signs of recovery.

Charlie Morris, ByteTree: The vast majority of bitcoin’s past gains coincided with periods of a flat or weak dollar. The implication is that bitcoin is likely to be a powerful hedge against US dollar weakness. How likely is that? Quite likely given it is Fed policy.

IntoTheBlock: There are two areas of strong resistance for bitcoin based on on-chain data. The first one is the current resistance it is facing around the $11,000 mark, where 626K BTC has been bought by 1.17 million addresses. This creates resistance from many of these addresses looking to close their positions to break-even. After that, there is another similar resistance level between $11,400 and $11,700 as shown in the graph above. The good news is that past these resistance levels, there is likely to be less selling pressure past $12,000.

Matt Blom, Diginex: Despite the propensity to buy, hold, and not move bitcoin, the network remains buoyed by growth. The only thing going sideways in bitcoin is the price.

Jason Lau, OKCoin: Bitcoin’s price momentum is still positive, with its pullbacks leaving higher highs. This is signaling a possible further continuation of this upwards move. Bitcoin perpetual swaps funding rates have started turning positive. This indicates that investors are more willing to go long at current price levels.

George McDonaugh, Keld van Schreven, Kr1 Plc: We are currently seeing some correlation between bitcoin, other digital assets and movements in the equity and gold markets. We expect the trend of strengthening balance sheets and diversification into bitcoin to continue as the world’s monetary policies shift evermore towards unbridled money printing and higher inflation. 

QCP Capital: The key support from the early month lows of $10,000 on BTC and $310 on ETH both saw substantial buying demand. This prevented any cascading short gamma selling into quarter-end, which had been our fear if those levels broke.

Constantin Kogan, BitBull Capital: We’re seeing a spike in activity by new participants coming into BTC not yet reflected in price. It doesn’t happen often. This is what traders call a divergence. In this case the trend looks more bullish. 

Patrick Tan, Novum Alpha: While it may be tempting to subscribe to the notion that bitcoin will represent a safe haven in times of instability, there’s little evidence to support that view – especially since gold, tech stocks and Bitcoin have all tracked each other closely this year. A further round of stimulus, or a smoother than expected political transition, could pave the way for bitcoin to move higher as politicians get past electing and get back to spending.

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BITCOIN WATCH


Bitcoin, gold, S&P 500, and dollar index daily charts. (TradingView)

Bitcoin is trading in the narrow range of $10,600 to $11,000 for the seventh straight day. 

The long-term sentiment remains bullish, as evidenced by a continued decline in the number of coins held on cryptocurrency exchanges - a sign of investors shifting to holding strategies. 

In the short-run, the cryptocurrency could continue to take cues from the U.S. dollar and stock markets.

"We can't ignore the greenback's breakout from its recent consolidation and expect a continued rally in the dollar to weigh over BTC," said Matthew Dibb, CEO of Stack Funds.

The cryptocurrency fell by over 7% in September, confirming its biggest monthly decline since March as the oversold dollar index rose nearly 1.8%. Bitcoin, gold and S&P 500 have moved largely in the opposite direction to the dollar index since March. 

- Omkar Godbole

TOKEN WATCH

Ether (ETH): Record $166M Ethereum fees last month were six times bigger than bitcoin's.  

SushiSwap (SUSHI):
Collateral locked into "vampire mining" protocol plunges to $354M from $1.4B a few weeks ago.  

Trump tokens (TRUMP): Prices for FTX crypto exchange's "futures contract" tracking U.S. president's chances of staying in office slide after this week's presidential debate.  

Chainlink (LINK), Loopring (LRC), Compound (COMP): DeFi system MakerDAO (MKR, DAI) community votes to add support for Chainlink's LINK, Loopring's LRC and Compound's COMP.  

WHAT'S HOT

Diginex stock goes live on Nasdaq following $50M in SPAC and private funding (CoinDesk)

Talos, institutional-grade conduit to crypto ecosystem, emerges from stealth mode to serve brokers, custodians, exchanges and over-the-counter trading desks (CoinDesk)

Hive Blockchain says DeFi buzz led to record fees in quarter ended Sept. 30, with a 50% year-over-year increase in ether mined to 32K ETH (CoinDesk)

Canaan Creative, publicly traded maker of cryptocurrency mining computers, suffered its fourth straight stock-price decline in the third quarter (CoinDesk)

Compound's Leshner says "pace of people trying new things is the highest it's ever been" as DeFi enters "lightspeed era" (CoinDesk)

BitFlyer cross-border initiative allows European traders to access bitcoin/Japanese yen trading pair (CoinDesk)

Twitter CEO Jack Dorsey tweeted his disapproval of Coinbase CEO Brian Armstrong steering his company away from corporate activism (CoinDesk)

With the first Trump–Biden debate now smoldering behind us, the betting markets have picked their winner and it isn't Donald Trump (CoinDesk)

The U.S. Securities and Exchange Commission has ordered Salt Lending to offer investors refunds for its 2017 initial coin offering (ICO) (CoinDesk)

Money Reimagined: A new podcast by CoinDesk

Imagination has always been a key part of what money is. That piece of paper in your wallet only has value because the payer and the payee have both invested belief in its value. The crypto community—and its many competing sub-communities—create that common meaning with their preferred form of money.

We've launched a new podcast to explore these ideas and the technological, political and social forces reshaping our financial system.

Listen to the Money Reimagined podcast, hosted by our Chief Content Officer and author of CoinDesk's Money Reimagined newsletter Michael Casey and Sheila Warren of the World Economic Forum, on Fridays at 10 a.m. ET.

ANALOGS
The latest on the economy and traditional finance

American Airlines and United Airlines have begun the process of instigating 32,000 furloughs or temporary leave as hopes for further economic stimulus fades fast (Reuters)

Speaker of the House Nancy Pelosi and Treasury Secretary Steven Mnuchin did not reach a deal for coronavirus stimulus on Wednesday and instead want to do some more talking (CNBC)

U.S. Federal Reserve is set to bar big banks from share buy backs while having to cap their dividends under the new regulator's policy (Reuters)

The U.S. has banned palm oil imports from Malaysia's largest producers over concerns of forced labor and sexual assualt (SCMP)

Biden and Trump both vowed to support the electric vehicle industry during the 2020 presidential debate on Tuesday (CNBC)

Universities are often key to getting new industries off the ground, providing the infrastructure to take paradigm-shifting ideas to the next level. But in blockchain and digital finance technology, how do they measure up?

Introducing CoinDesk U, a ranking of the top 20 schools identified in our research in collaboration with Mousebelt.

During a special CoinDesk Live episode on Oct. 6, we will release the results of the first CoinDesk U ranking. We are inviting students from around the U.S. as well as representatives from student club networks, the crypto industry and leading institutions to discuss traditional academia’s relevance and support for the financial technology poised to fuel Web 3.0.

Watch CoinDesk Live: Can Old Schools Teach New Tech on CoinDesk.com, Twitter and  YouTube.

TWEET OF THE DAY

Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.
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