On Wednesday, Block, the financial services firm, disclosed that merchants using Square can convert their daily sales into bitcoin through the Cash App. Block’s founder, Jack Dorsey, revealed this update on X, and as of today, merchants have the option to transfer between 1-10% of their Square-generated earnings into bitcoin, the leading crypto asset by […]
Bitcoin News
Transak Partners With Visa for Rapid Crypto to Fiat Conversion in 145 Nations
On Tuesday, Transak, a company specializing in payment infrastructure, revealed its partnership with the financial services powerhouse Visa. This collaboration aims to empower users in 145 nations with the capability to seamlessly exchange their crypto holdings into local fiat currencies, leveraging the Visa Direct platform.
Enhanced Crypto Liquidity: Transak’s Alliance with Visa Facilitates Swift Global Transfers
Transak, a provider of payment infrastructure for cryptocurrency assets and non-fungible tokens (NFTs), has entered into a partnership with the leading payment company Visa. This collaboration facilitates instant withdrawals of crypto funds to debit cards in 145 countries, as highlighted by Transak’s announcement.
“By enabling real-time card withdrawals through Visa Direct, Transak is delivering a faster, simpler and more connected experience for its users — making it easier to convert crypto balances into fiat, which can be spent at the more than 130M merchant locations where Visa is accepted,” the North America head of Visa Direct and Global Ecosystem Readiness, Yanilsa Gonzalez-Ore said.
The press announcement sent to Bitcoin.com News highlights that a key attribute of Visa Direct is its capability for immediate transaction processing. This translates to the possibility of money transfers being completed in nearly 30 minutes or less, marking a notable improvement compared to conventional banking practices, which often require several days.
“Combining this with Transak’s robust infrastructure and support for over 40 cryptocurrencies, the collaboration welcomes a new dawn for those who want to quickly exit the crypto market,” the company emphasized. The partnership follows Visa’s announcement earlier this month that it will include Web3 elements in its customized loyalty program solution.
What do you think about Transak’s and Visa’s partnership? Let us know what you think about this subject in the comments section below.
Grayscale’s Bitcoin ETF Conversion Could Lead To $2.7 Billion Exodus: JPMorgan
In a new analysis, JPMorgan has raised concerns about the potential outflow of funds following the possible conversion of Grayscale Bitcoin Trust (GBTC) into an ETF. The banking giant estimates that the conversion could prompt investors to withdraw at least .7 billion.
The Grayscale Bitcoin Trust, a pivotal force in the previous bull market, has seen its discount to Bitcoin’s current market price shrink from -46% at the beginning of the year to -9.77% by November 22, the lowest level since mid-August 2021. Notably, this reduction in discount is important because it indicates that investors are expecting the US Securities and Exchange Commission (SEC) to approve Grayscale’s conversion to a spot Bitcoin ETF. However, JP Morgan has cautioned that this conversion might lead to some instability in the market.
.7 Billion Exodus Following Bitcoin ETF Approval?
JPMorgan analysts, including Nikolaos Panigirtzoglou, have scrutinized the inflows into GBTC since the beginning of 2023, revealing a calculated strategy by traders to exploit the discount for profit upon ETF conversion. The bank’s methodology considered the cumulative signed dollar volume, accounting for both the volume of shares traded and the direction of the price movement.
The analysts posit that this influx, primarily driven by speculation over GBTC’s conversion to an ETF, will likely reverse as investors seek to capitalize on the arbitrage opportunity presented by the narrowing of the discount to net asset value. The minimum anticipated outflow, upon conversion to an ETF, stands at .7 billion.
However, this could escalate if GBTC’s current fee structure, standing at 200 basis points, isn’t significantly reduced post-conversion. The competitive landscape, as suggested by the ARK 21Shares Bitcoin ETF’s 80 basis points fee, necessitates such a reduction for GBTC to maintain its market dominance.
The impact on the market could be profound. A full withdrawal of the .7 billion could exert substantial downward pressure on Bitcoin prices. However, JPMorgan analysts believe that much of this capital will likely be reallocated to other Bitcoin-related instruments, mitigating any drastic market disturbance.
They predict a reconfiguration of assets, shifting from billion in GBTC and billion in other funds to billion in the trust and billion in other vehicles. Nonetheless, they caution that a portion of the funds may exit the Bitcoin space entirely, which would pose a risk of a downturn in Bitcoin prices.
Remarkably, JP Morgan analysts led by Panigirtzoglou have predicted in early September that the SEC will be forced to approve spot Bitcoin ETFs after losing the case against Grayscale. Moreover, JP Morgan’s forecast hinges on the assumption that the approval of a batch of ETFs will ignite more intense competition among Bitcoin investment products, likely resulting in a fee structure more aligned with those of Gold ETFs, typically around 50 basis points.
As the market awaits the SEC’s decision, the primary concern remains: Whether the anticipated GBTC outflows will find a new home within the Bitcoin space or if they will signify a broader withdrawal from BTC investments.
At press time, BTC traded at ,560.
SEC Ordered to Re-Evaluate Grayscale’s Bitcoin ETF Conversion With Court Mandate
The U.S. Securities and Exchange Commission (SEC) once again holds the reins when it comes to evaluating Grayscale’s spot bitcoin exchange-traded fund (ETF) application. On October 23, 2023, the U.S. Court of Appeals for the D.C. Circuit delivered a directive, compelling the SEC to take another look at the company’s prospectus. Now, the SEC stands at a crossroads: greenlight Grayscale’s proposal or pinpoint alternative reasons for rejection.
Court Mandate Urges SEC to Reassess Grayscale’s Bitcoin ETF Application
In late August, Grayscale secured a victory at the U.S. Court of Appeals for the D.C. Circuit in its spot bitcoin conversion suit against the SEC. Grayscale labeled the decision as a “monumental step” in its ongoing battle with the regulator. Not becoming complacent, the firm dispatched a letter in September, prodding the securities watchdog to accelerate the approval process.
While the SEC could have contested the ruling, they let the opportunity slip by, and insiders conveyed to the media that an appeal wasn’t on the cards. Unwavering, Grayscale refreshed its approach with an updated S-3 submission to the SEC. With the court’s latest directive, it’s back to the drawing board for the SEC; they must revisit Grayscale’s case and either give it the nod or reject it on fresh grounds.
The SEC isn’t just dealing with Grayscale; they’ve got a stack of nearly a dozen spot bitcoin ETF registration requests to sift through. This includes heavyweight financial submissions from the likes of Blackrock, Fidelity, Invesco, and Franklin Templeton. Meanwhile, on Monday, Bloomberg Intelligence’s lead analyst, Eric Balchunas, unveiled on social network X that the Depository Trust & Clearing Corporation (DTCC) had cataloged the Ishares Bitcoin Trust under the ticker “IBTC.”
Following the Grayscale revelations and the DTCC’s addition of IBTC, bitcoin’s value surged on Monday, nearing ,800 on Monday. As for GBTC, its shares have seen an uptick concerning the discount to its net asset value (NAV). A stark contrast to the hefty 48% discount from ten months prior, it dwindled to a mere 11.03% on October 20, 2023, as per ycharts.com data.
What do you think about the court order filed on Monday? Share your thoughts and opinions about this subject in the comments section below.
Hawaii Man Charged for Making False Security Fund Conversion to Crypto Claims
The U.S. Securities and Exchange Commission has charged a Hawaiian resident for falsely claiming that his fraudulent security would become the “first publicly traded security fund to convert to a cryptocurrency.” According to the Commission, the man promoted the security to boost its price and bolster the value of his portfolio.
Fabricated Documents Used to Perpetrate the Fraud
The U.S. Securities and Exchange Commission (SEC) has charged a Hawaiian resident Jeremy Koski for allegedly fabricating and posting fake documents about a purported security that he said would become the “first publicly traded security fund to convert to a cryptocurrency.” The SEC also accused Koski of falsely claiming that the conversion would “allow the fund to recover the face value of as it opens up to a new world of digitized currency.”
According to the Commission’s Sept. 1 press release, the SEC has since formally charged Koski with “violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5.” The SEC said it is seeking a permanent injunction against future violations.
Explaining how Koski perpetrated the fraud, the SEC alleged that the Hawaii resident had used internet message boards and different usernames to promote the fake documents. Koski’s objective according to the Commission was to not only boost the price of the security that used the symbol COTRP but bolster the value of his portfolio.
To support these allegations, the SEC claimed that after Koski posted a notice in May 2021 stating that the “JCP debentures would be redeemed early at their full value,” the price of the security went up by 75%. According to the SEC, Koski was aware that his statements were false.
What are your thoughts on this story? Let us know what you think in the comments section below.
Green Bitcoin Mining: Nodal Power Secures $13M for Landfill Gas Conversion
Utah-based Nodal Power, which specializes in turning landfill gas into energy for powering bitcoin (BTC) mining hubs, recently announced a successful million seed round backed by strategic investors. Bryan Black, Nodal’s CEO, stressed the technology’s “potential to make a significant impact on local energy markets.”
Nodal Power Raises M to Convert Landfill Gas to Bitcoin Mining Energy; Eyes Local Market Impact
Nodal Power, a company that converts landfill gas into energy for Bitcoin mining centers, has secured million in seed funding. This technology reduces methane gas emissions from landfills and uses that energy for mining. Nodal combusts the methane, typically flared or vented, with a generator. The resulting electricity is then provided to local utilities and BTC mining operations.
Nodal says a significant portion of the funding has been invested in building and operating two power plants in the United States. The first, in the Southeast, uses landfill gas to provide electricity to the nearby utility. It also features a bitcoin data center, promoting an economic balance between the bitcoin mine and the utility.
The company explained that the second plant, in the Mountain West, leads in creating a fully sustainable off-grid data center powered only by landfill gas. Plans are underway to invest additional funds in a third U.S. location by early 2024. All these facilities generate green electricity from methane, produced from organic waste decomposition in landfills.
“We’ve developed solutions, specifically for smaller landfills, that allow us to bring these overlooked resources to market,” CEO Bryan Black explained during the announcement. “Our technology and energy-first approach have the potential to make a significant impact on local energy markets.”
Using flared or vented gas for Bitcoin mining isn’t new. Companies such as Crusoe Energy, Vespene Energy, EZ Blockchain, and Alkane Midstream offer similar services. Publicly traded energy company Equinor reportedly used gas flaring for Bitcoin mining in North Dakota. YPF Luz, an Argentine oil subsidiary, powered bitcoin mining with residual gas.
What do you think about Nodal Power raising million from investors in a seed round? What do you think about landfill gas conversion to bitcoin mining? Share your thoughts and opinions about this subject in the comments section below.
Court Rules in Favor of Grayscale Against SEC in Bitcoin ETF Conversion Lawsuit
A D.C. court has ruled in favor of Grayscale, the largest crypto asset manager, in its lawsuit challenging the U.S. Securities and Exchange Commission’s decision to deny the conversion of GBTC to a spot bitcoin exchange-traded fund (ETF). The securities regulator “failed to explain its different treatment of similar products,” said the Circuit judge presiding over the Grayscale-SEC case.
Court Sides With Grayscale Against SEC
The United States Court of Appeals for the District of Columbia Circuit ruled in favor of Grayscale Investments against the U.S. Securities and Exchange Commission on Tuesday regarding the company’s proposed bitcoin exchange-traded fund (ETF) conversion.
“The D.C. Circuit ruled 3-0 in favor of Grayscale and GBTC,” the crypto asset management firm wrote on the social media platform X. “This is a monumental step forward for all who have been advocating for bitcoin exposure through the added protections of the ETF wrapper.” Commenting on the court ruling, Grayscale CEO Michael Sonnenshein wrote:
The D.C. Circuit ruled in favor of Grayscale in our lawsuit challenging the SEC’s decision to deny GBTC’s conversion to an ETF!
Grayscale has been trying to convert its flagship bitcoin trust (GBTC) to a spot bitcoin ETF. However, the securities regulator has denied the crypto asset manager’s application. Grayscale subsequently filed a lawsuit challenging the Commission’s denial order.
So far, the SEC has not approved a spot bitcoin ETF even though the agency has greenlighted several bitcoin futures ETFs. A number of bitcoin ETF proposals have been filed with the regulator, including one by the world’s largest asset manager, Blackrock.
In its “petitioning for review of the Commission’s denial order,” Grayscale maintains that its proposed bitcoin ETF product “is materially similar to the bitcoin futures exchange-traded products and should have been approved to trade on NYSE Arca,” the court order shows.
Circuit Judge Neomi Rao, one of the three judges presiding over the Grayscale-SEC case, stated in the court order issued on Tuesday:
We agree. The denial of Grayscale’s proposal was arbitrary and capricious because the Commission failed to explain its different treatment of similar products. We therefore grant Grayscale’s petition and vacate the order.
What do you think about the Circuit Court siding with Grayscale against the SEC? Do you think the SEC will soon approve a spot bitcoin ETF? Let us know in the comments section below.
Hong Kong’s Largest Virtual Bank Offers Crypto Conversion Services
ZA Bank, Hong Kong’s biggest virtual-only lender, intends to expand its business into the region’s growing digital assets sector. The banking platform will offer crypto-to-fiat conversions and account services as the Chinese financial center is seeking to embrace the industry.
ZA Bank to Provide Services to Crypto Exchanges Licensed in Hong Kong
Hong Kong’s first and largest virtual bank, co-founded by Chinese billionaire Ou Yaping, is looking to facilitate transfers of digital and fiat currencies for participants in the city’s developing crypto sector, Bloomberg reported quoting the lender’s top executive.
According to CEO Ronald Iu, ZA Bank will offer crypto-to-fiat currency conversions through licensed exchanges, acting as a settlement bank for clients who deposit digital coins to the trading platforms and want to withdraw Hong Kong and U.S. dollars or Chinese yuan. Iu pointed out:
For the dozen of interested firms, big or small, from abroad and local, top of their concern is to have a path to make things work.
According to the report, ZA Bank is already working with the two currently authorized crypto exchanges in Hong Kong, Hashkey and OSL. It intends to provide the service to others as more platforms obtain a license to operate in China’s special administrative region.
In a post-pandemic world, Hong Kong has been opening up to the crypto space, despite its recent troubles. With the goal of becoming a crypto hub, the city is seeking to revive its status of a global financial center.
There have been signs that Hong Kong’s push into the crypto market has the support of Beijing, despite the crackdown on crypto activities in the mainland. A report revealed in late March that state-owned Chinese banks are ready to serve crypto companies in the city. One of China’s largest insurers backed the launch of two crypto-focused funds in early April.
Hong Kong authorities are now working to revamp the legal framework for cryptocurrency exchanges in order to allow them to open to retail investors. The region’s financial regulators are also taking steps to improve access to banking services for crypto companies.
Currently, ZA Bank plans to engage only with licensed digital asset exchanges. It’s conducting anti-money laundering (AML) checks in compliance with existing requirements and has not had any AML issues over the past months, according to its Alternate Chief Executive Devon Sin.
The virtual bank is also opening online accounts for Web3 startups and other small and medium enterprises. Around 100 such companies have access to its services following a trial in a regulatory sandbox, the report detailed.
Do you expect Hong Kong to continue to improve access to banking services for crypto companies? Tell us in the comments section below.
Binance And Coinbase Temporarily Suspend USDC Conversion After Silicon Valley Bank Collapse
The two biggest cryptocurrency exchanges, Binance and Coinbase, have revealed that they would temporarily suspend USDC conversions on their platforms. This comes in the aftermath of the collapse of US lender Silicon Valley Bank and concerns about its effect on USDC.
Binance And Coinbase Suspend USDC Conversion
Binance was the first to make a move by announcing that it had temporarily suspended its auto-conversion of USDC to BUSD. Citing current market conditions, the exchange added that it was a standard risk-management procedure while monitoring the market situation.
It should be noted that Binance had earlier in the year courted controversy with its decision to auto-convert USDC transactions to BUSD. At the time, Binance cited improving liquidity for users, and it is unknown if this latest development could lead to permanently delisting the stablecoin.
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Following Binance’s announcement, Coinbase also tweeted that it would pause its USDC conversion to USD until Monday. The exchange noted that during heightened activities, conversions rely on USD transfers from banks completed during banking hours. It further added that conversions would resume on Monday when banks reopen.
Silicon Valley Bank’s collapse has caused a ripple effect in the fintech company, with several companies revealing their exposure to the U.S-based bank. Some affected crypto companies include Pantera, Avalanche, and BlockFi.
Circle, the company behind USDC, revealed on Friday that it had .3 billion of the billion reserves backing the stablecoin in the now-defunct bank. It added in a statement on Twitter that Silicon Valley Bank was one of six banks it uses to manage 25% of USDC reserves. Circle noted that it would continue to operate normally while awaiting clarity from the FDIC on how SVB collapse would affect depositors.
USDC Market Cap Decreases Following Circle Announcement
Unsurprisingly the crypto market has reacted to the news with investors removing their assets from USDC. At the time of writing, more than .3 billion has been redeemed from the stablecoin in the past few hours.
The trading price of USDC has also suffered volatility dropping from its pegged value of to as low as .93, according to data from CoinMarketCap. This is the lowest the stablecoin has reached since its all-time low of .89 in May 2019. Its marketcap has also reduced to billion.
Silicon Valley Bank’s collapse has been tagged as the worst bank failure since 2008, and there’s uncertainty about what is next for the bank. Its stock is down 87% in two days due to the crash and has been placed into FDIC receivership.
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Experts have hypothesized that other banks may likely suffer the same fate if their business models and balance sheets are not properly managed for rising interest rates and the growing possibility of a recession.
The consistent raising of interest rates by the Federal Reserve could have been a significant factor to SVB’s implosion.
Featured Image from Unsplash, Charts from Coingecko
Skrill Doubles Down on Crypto? Offers New Crypto-to-Crypto Conversion Feature
Online payment services firm Skrill has announced the expansion of its cryptocurrency offering. With its crypto-to-crypto buy and sell service, Skrill users will now be able to use Bitcoin to buy other cryptocurrencies, making transactions on the platform faster and lower-cost. It comes after the UK-based firm first introduced its Cryptocurrency Service last year.
Before this change, Skrill customers could use their fiat account balances to purchase any of nine different cryptocurrencies, including Bitcoin, Ether, Litecoin, and XRP, among others. However, if they wanted to exchange one cryptocurrency for another, they’d have to sell their holdings and use the proceeds in fiat to purchase their chosen coins.
The new service enables users to sell their Bitcoin in exchange for one of the other supported cryptocurrencies, with trading pairs for BTC vs. the other eight tokens already available. The company anticipates that more pairs will be added soon. By allowing crypto-to-crypto transfers, Skrill users can enjoy lower fees resulting from fewer transactions.
Customers can fund their accounts from a choice of 40 different fiat currencies via credit card or bank transfer. Other features of the platform include automated ordering and a “Reserves” feature to set up recurring crypto purchases, enabling users to take advantage of dollar-cost averaging for their crypto investments.
Formerly known as Moneybookers, Skrill was established in 2001 as a competitor to other online payment firms such as PayPal. According to Crunchbase, the company has amassed over 20 million users and over 100,000 merchant clients. It’s currently owned by Paysafe, which also operates the NETELLER wallet. Paysafe plans to roll out Skrill’s crypto-to-crypto buy and sell service to NETELLER users over the coming months.
Crypto Proving Attractive for Online Payment Firms
Skrill’s expansion into the cryptocurrency space is indicative of a growing interest in digital assets from participants in the online payment sector. PayPal’s well-documented entry and recent departure from the Libra Association is perhaps the best-known.
However, a closer rival to Skrill is Revolut, which also launched its own version of a cryptocurrency buy-and-sell service in 2017. The company has recently been in the news after co-founder Nik Storonsky revealed that it’s seeking a 0 million investment to fund its expansion into new geographies. Target countries include the United States, Canada, Brazil, and Japan.
Revolut also recently dropped 13 places to rank #26 in KPMGs annual “Fintech 100” report, which lists leading global fintech innovators. This still placed it ahead of other cryptocurrency firms, including Coinbase, which ranked at #34 and Liquid, which ranked at #38. Chinese fintech giant Ant Financial, which owns Alipay and is valued at billion, topped the list for the second year running.
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