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Derivatives

3X as many crypto figures make it onto Forbes 2021 billionaires list as last year

Forbes released their annual billionaires list on April 6, with Amazon overlord Jeff Bezos and his $177 billion topping the list for a fourth consecutive year.

The “digital gold rush” has seen nine new crypto billionaires join the Forbes list, pushing the total up to 12 (depending on whether you count the Winklevoss twins as one or two entries.) That’s up from just four in last year’s Forbes World’s Billionaires list

Sam Bankman-Fried – Newcomer

Sam Bankman-Fried is the wealthiest crypto-billionaire, with a net worth of $8.7 billion. Bankman-Fried founded trading firm Alameda Research and popular derivatives exchange FTX. The 29-year old has made waves in the crypto space, with FTX recently winning the naming rights to Miami Heat’s home stadium for 19 years. Cointelegraph recently ranked Bankman-Fried as the third most influential figure in crypto for 2020.

The Winklevoss Twins – Newcomers

Cameron and Tyler Winklevoss have a net worth of $3 billion each and started investing in Bitcoin in 2012. The brothers famously sued Facebook’s Mark Zuckerberg for IP theft in 2004 and won a $65 million settlement which they used to invest in Bitcoin. They started the crypto exchange Gemini in 2014, and they purchased Nifty Gateway in November 2019.

Chris Larsen – Returnee

Larsen, the co-founder of Ripple Labs saw his net worth grow from $2.6 billion to $3.4 billion over the past year.

Larson and Ripple CEO Brad Garlinghouse have been fighting an ongoing dispute with the SEC in relation to XRP and unregistered securities offerings. However, the SEC’s lawsuit against Ripple hasn’t appeared to affect its token too badly, with XRP increasing by 387% in the last 12 months.

Jed McCaleb – Newcomer

McCaleb is another co-founder of Ripple, and reportedly holds 3.4 billion XRP and 1 billion Stellar Lumens — the cryptocurrency he founded after leaving Ripple — with his holdings adding up to a net worth of $2 billion. Cointelegraph reported that McCaleb sold off $400 million worth of his XRP holdings in 2020 alone.

Michael Saylor – Newcomer

Saylor is the CEO of listed company MicroStrategy and co-founded the software giant in 1989, and now has a net worth of $2.3 billion. Saylor has become the leading advocate for corporations holding Bitcoin on balance sheets. Since its first purchase of Bitcoin in August 2020, Microstrategy has invested $2.226 billion, taking its tally up to 91,579 Bitcoins at an average cost of $24,311 per Bitcoin.

Brain Armstrong – Returnee

Armstrong is the CEO and co-founder of Coinbase and his net worth has gone from $1 billion to $6.5 billion within 12 months. Coinbase also had a successful year, generating $1 billion in revenue, and it’s set for a direct listing in a week. That will value Armstrong’s shares somewhere north of $14B, meaning he may well top the crypto billionaires’ list next year.

Fred Ersham – Newcomer

Ersham co-founded Coinbase with Brian Armstrong in 2012 and left the firm in 2017. He is now a board member of the company, and his 6% stake has an estimated worth of $1.9 billion.

Changpeng Zhao

Zhao is the founder of the largest crypto exchange Binance and owns an estimated 30% stake in the company. Zhao’s net worth is $1.9 billion, and the digital gold rush has been good to the Binance founder, with Binance Coin becoming the second-largest altcoin by market cap. Zhao revealed earlier this week that he holds close to 100% of his portfolio in crypto.

Matthew Roszak – Newcomer

Roszak is the Chairman and co-founder of blockchain technology firm Bloq and is a leading crypto and blockchain investor. Roszak is also a founding member of Tally Capital a crypto-focused private investment firm and has a net worth of $1.5 billion.

Tim Draper – Newcomer

Draper is a crypto evangelist with a net worth of $1.5 billion. He bought $18.7 million worth of Bitcoin in 2014 after it was confiscated from the Silk Road black market. Draper was also one of the primary investors in the Tezos project and co-founded Draper Fisher Jurvetson, a leading investment firm in early-stage tech startups.

Barry Silbert – Newcomer

Silbert founded the crypto conglomerate Digital Currency Group in 2015 and has a net worth of $1.6 billion. The DCG owns asset management firm Grayscale Bitcoin Trust, which currently has $46 billion worth of assets under management.

3X as many crypto figures make it onto Forbes 2021 billionaires list as last year

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Stock-to-flow creator doesn’t think Bitcoin’s bull market is done

Bitcoin’s price seems to have stalled below $60,000 after attaining new all-time highs earlier in March. PlanB, a crypto analyst active on Twitter, thinks Bitcoin (BTC) may still have a lot of room to gallup however. 

“IMO we are only ~4 months into the bull market and nowhere near the end of it,” PlanB tweeted on Friday. “Bitcoin is just getting started,” he added, showing Bitcoin’s current path on one of his Stock-to-Flow charts. Multiple Stock-to-Flow models exist for Bitcoin which show Bitcoin’s price path in line with its halving events and supply over time.

YouTuber and derivatives trader Tone Vays also carries a bullish macro view, although he thinks a dip lower for Bitcoin is not out of the question.

“Bitcoin is consolidating but I remain bullish in this market,” Vays told Cointelegraph. “While it is still possible for bitcoin to make a lower low for the month in the $48k range, I believe we will go up to above $70k before June,” he added.

After trading past $61,000 this month, Bitcoin retraced down near $50,000. For the most part, the drop occurred over roughly two weeks, with some relief bounces mixed in, rather than in a straight, single-day $10,000 shot downward. Based on TradingView data, BTC holds a price of $54,550 at time of publication, looking back on a day of overall upward price action.

Meanwhile, other crypto assets continue to make headlines in the price category as well.

Stock-to-flow creator doesn\’t think Bitcoin\’s bull market is done

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BitMEX’s Arthur Hayes and Ben Delo negotiate surrender to U.S. authorities

The former CEO of crypto derivatives exchange BitMEX, Arthur Hayes, is in negotiations to surrender to U.S. authorities next month concerning charges that authorities levied against four of the exchange’s executives and co-owners in October.

Transcripts of a court teleconference dated Feb. 16 indicate Hayes will surrender to the U.S. in Hawaii on April 6. Hayes and his fellow executives are accused of violating the Bank Secrecy Act by the U.S. Department of Justice and  the Commodity Futures Trading Commission.

The transcript details the assistant U.S. attorney Jessica Greenwood’s comments to the judge presiding over the case, with Greenwood indicating she has been in talks with Hayes regarding the anticipated voluntary surrender. Hayes is currently located in Singapore, with the attorney noting Hayes hopes to continue residing abroad but will appear within the United States for proceedings should the trial go to court.

“We have discussed with counsel how to arrange for a voluntary surrender, and he has proposed appearing within the United States in Hawaii and having his initial appearance there and then,” she said, adding:

“The idea would be that he would appear initially in Hawaii, then appear before your Honor remotely, and then he would continue to reside abroad with travel to the United States for appearances as needed and, of course, if there is a trial, that he would appear within the United States for that trial in New York.”

Greenwood also revealed that BitMEX co-owner Ben Delo intends to surrender in New York by the end of the month. However, she noted they are currently working with the FBI and Border Patrol to obtain immigration authorization allowing him to travel to the United States, despite Delo currently being subject to a U.K. travel ban.

The attorney also stated that while fellow co-owner Greg Dwyer has declined to surrender, extradition proceedings have been initiated to bring him back from Bermuda.

“With respect to the remaining three defendants, […] we’ve been in contact with counsel discussing the possibility of appearing. They’ve all made representations about for when and how they’ll appear,” Greenwood said. However, she added:

“We have no guarantees at this point that any of those things will happen.”

BitMEX CTO, Samuel Reed, was arrested in Massachusetts as the charges were being levied against BitMEX in October. Reed was released from custody after a $5 million bond was paid that same month, with Reed agreeing to comply with sentencing proceedings.

In response to the hearing, the judge determined it wasn’t “reasonably possible” for a motion and trial schedule to be established. The judge scheduled a follow-up conference for May.

Last month, Hayes broke months of silence to post an article to BitMEX’s official blog calling for a boycott of legacy finance in response to trading platforms shutting down trade amid the GameStop pump engineered by subreddit, r/WallStreetBets.

BitMEX’s Arthur Hayes and Ben Delo negotiate surrender to U.S. authorities

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Here’s how the Purpose Bitcoin ETF differs from Grayscale’s GBTC Trust

Since 2017, investors have been anxiously awaiting a Bitcoin ETF approval as the existence of such a fund was an important symbol of mass adoption and acceptance from the realm of traditional finance. 

On Feb. 18, the Toronto Stock Exchange hosted the official launch of the Purpose Bitcoin ETF and the fund quickly absorbed more than $333 million in market capitalization in just two days.

Now that the long-awaited Bitcoin ETF is here, investors are curious about how it will compete with Grayscale Investments GBTC fund. On Feb. 17, Ark Investment Management founder and CEO Cathie Wood said the likelihood that U.S. regulators will approve a Bitcoin exchange-traded fund has gone up.

Although exchange-traded funds (ETF) and exchange-traded notes (ETN) sound quite similar, there are fundamental differences in trading, risks, and taxation.

What is an exchange-traded fund?

An ETF is a security type that holds underlying investments such as commodities, stocks, or bonds. It often resembles a mutual fund, as it is pooled and managed by its issuer.

ETFs have become a $7.7 trillion industry, growing by 65% in the last two years alone.

The most recognizable example is the SPY, a fund that tracks the S&P 500 index, currently managed by State Street. Invesco’s QQQ is another EFT that tracks U.S.-based large-capitalization technology companies.

More exotic structures are available, such as the ProShares UltraShort Bloomberg Crude Oil ($SCO). Using derivatives products, this fund aims to offer two times the daily short leverage on oil prices.

What is an exchange-traded note?

Exchange-traded notes (ETN) are similar to an ETF in that trading occurs using traditional brokers. Still, the difference is an ETN is a debt instrument issued by a financial institution. Even if the fund has a redemption program, the credit risk relies entirely on its issuer.

For example, after Lehman Brothers imploded in 2008, it took ETN investors more than a decade to recoup the investment.

On the other hand, buying an ETF gives one direct ownership of its contents, creating different taxation events when holding futures contracts and leveraging positions. Meanwhile, ETNs are taxed exclusively upon sale.

GBTC does not offer conversion or redemption

Grayscale’s Bitcoin Trust Fund (GBTC) is the absolute leader in the cryptocurrency market, with $35 billion in assets under management.

Investment trusts are structured as companies — at least in regulatory form — and are ‘closed-end funds.’ Thus, the number of shares available is limited and the supply and demand for them largely determines their price.

Investment trust funds are regulated by the U.S. Office of the Comptroller of the Currency (OCC), therefore outside the Securities and Exchange Commission (SEC) authority.

GBTC shares cannot easily be created, neither is there an active redemption program in place. This tends to generate significant price discrepancies from its Net Asset Value, which is the underlying BTC fraction represented.

An ETF, on the other hand, allows the market maker to create and redeem shares at will. Therefore, a premium or discount is usually unlikely if enough liquidity is in place.

An ETF instrument is far more acceptable to mutual fund managers and pension funds as it carries much less risk than a closed-ended trust like GBTC. Retail investors may not have been aware of the possibility that GBTC trades below net assets value. Thus the recent event might further pressure investors to move their position to the Canadian ETF.

To sum up, an ETF product carries a significantly less risk due to greater transparency and the possibility to redeem shares in the case of shares trading at a discount.

Nevertheless, the impressive GBTC market capitalization clearly states that institutional investors are already on board.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Here’s how the Purpose Bitcoin ETF differs from Grayscale’s GBTC Trust

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Focus on DeFi ‘fairness’ benefits Holochain, Orion Protocol and Dodo

Bitcoin’s (BTC) strong bull run and the immense popularity of the decentralized finance space have attracted several new investors to cryptocurrencies. A report from Crypto.com shows a massive increase in crypto users as the figure rose from 66 million in May 2020 to 106 million by January this year. 

Crypto market data daily view. Source: Coin360

Contrary to the popular notion that new crypto users are mostly speculating on the price, data from Unchained Capital shows that investors who bought in the past three to five years are still holding and are not yet tempted to book profits.

Unlike the 2017 bull market where many low-cap altcoins rallied, the current bull trend has rewarded projects with strong fundamentals. Let’s have a look at three such tokens and also analyze their charts.

HOT/USD

Holochain (HOT) aims to provide the solution for the scalability problems which may be a limiting factor in the crypto sector. Holochain wants to give control of data and privacy back to the people, eliminating large corporations and middlemen.

To achieve that, Holo, a distributed peer-to-peer hosting platform, acts as the link between the web and the Holochain apps. Holochain wants to make this technology available to users who can access the apps in a web browser. If this needs to be done, the technology must have vast scalability, fast speeds, and it should also be financially viable. The team at Holochain believes they are on the path to achieving this goal.

As part of the process, Holochain launched an app called Elemental Chat that runs on HoloPorts. The team is also planning to enable web users to log into Elemental Chat through the HoloPort. This will put the protocol’s scalability claims to the test and help to further fine-tune the project.

The team has also outlined the progress on the upcoming milestones of the Holo suite of products that will be progressively released in the future. If the team delivers on its promises, the protocol may attract investor attention.

HOT surged from $0.0007817 on Feb. 8 to an intraday high at $0.00424 on Feb. 21, a 442% rally within two weeks. This up-move had pushed the relative strength index (RSI) above 92 on Feb. 21, indicating the market was extremely overbought in the short term.

HOT/USDT daily chart. Source: TradingView

That resulted in profit-booking on Feb. 22 and 23, which pulled the price down to the 61.8% Fibonacci retracement level at $0.0021028. But the positive sign is that the long tail on the candlesticks on both days showed strong buying at lower levels.

However, traders who are stuck at higher levels are dumping their positions on rallies, as seen from the long wick on the Feb. 24 candlestick.

After the large intraday range of the past few days, the HOT/USD pair has formed an inside day candlestick pattern today, indicating a balance between supply and demand. The pair may now consolidate for a few days.

If the bulls can push the price above $0.00363, a retest of $0.00424 is possible. A breakout of this level could start the next leg of the up-move that may reach $0.0055629.

Conversely, if the bears sink the price below $0.0028, the pair may drop to the 20-day exponential moving average ($0.0020).

ORN/USD

As the decentralized finance space grows, many new projects are being announced on a regular basis. It becomes difficult for investors to keep track of all of them. Hence, a liquidity aggregator that connects to several decentralized and centralized exchanges in order to swap pools and provide access from a single platform may be sought after and this is what the Orion protocol (ORN) aims to do.

The protocol plans to offer its investor’s a variety of revenue streams. The Orion Liquidity Boost Plugin offers increased liquidity to its partners and has already onboarded Polkastarter and many other blockchain projects.

Orion’s Launchpad Liquidity has partnered with DAO Marker and DuckDAO, which will enable projects launch incubated projects on the launchpad’s own platform

Orion recently launched the staking calculator, allowing ORN token holders to calculate the staking rewards and attain APY’s of up to 38%.

After launching the first phase of the Orion Terminal’s mainnet on Dec. 15, the team plans to add several features like derivatives, leveraged ETFs, contract trading, NFTs, lending, margin trading and staking of any digital asset by 2021.

As more products are launched, the revenue is likely to increase and that may benefit ORN token holders.

ORN has been in a strong bull run this year. It rallied from $4.3014 on Feb. 8 to an intraday high at $15.20 today, a 253% rally in just over two weeks. As a result, the RSI has surged to above 91 levels, indicating the possibility of a short-term fall or a range-bound trading action.

ORN/USDT daily chart. Source: TradingView

The bears tried to stall the rally on Feb. 22 and Feb. 23, but the long tail and the positive closes of each day show that the bulls purchased the dips and resumed the rally.

However, today it looks as if traders booked profits and a retest of the 38.2% Fibonacci retracement level at $11.4379 is possible. 

If the ORN/USD pair rises from this support level, it will indicate strong demand at lower levels. That could result in a retest of $15.20 and a breakout of this resistance may propel the pair to $20.

On the other hand, a break below $10.2759 could pull the price down to the 20-day EMA ($8.21). Such a deep fall could delay the next leg of the up-move.

DODO/USD

The DeFi space has been attracting investor attention in the past few months. However, the growing popularity has clogged the Ethereum network gas fees have soared to unsustainable levels. Therefore, traders are searching for options that are on competing networks and charge fewer fees. Binance Smart Chain has been one of the major beneficiaries of this trend.

DODO is a decentralized exchange that uses the Proactive Market Maker (PMM) algorithm, which the team claims is better than automated market makers. DODO offers several features such as trading, aggregation, initial DEX offerings, and mining.

DODO introduced Crowdpooling in January, and this feature aims to provide equal opportunity to investors by addressing the biggest issues being faced by new projects. If successful, Crowdpooling will help prevent frontrunning, insufficient liquidity, and the high costs associated with attracting liquidity. The first phase of the DODO V2 Beta crowdfunding pool called ‘ShuttleOne’ was a huge success as it was oversubscribed by 173 times.

DODO token was listed on Binance on Feb. 19 following the DODO V2 Public Beta launch on the Ethereum Mainnet and Binance Smart Chain on Feb. 22. There are also several incentive programs available on BSC.

DODO price rallied from an intraday low at $2.788 to an intraday high at $10 on Feb. 19. The token had strong listing gains but since then, the price has been in a corrective phase.

DODO/USD 4-hour chart. Source: TradingView

The bulls attempted to start a rebound off $3.50 on Feb. 23, but the bears continue to sell on minor rallies, indicating a negative sentiment. However, a minor positive is that the bulls have been defending the $4.50 level for some time.

If the price turns up from the current level and breaks above $5.660, the DODO/USD pair may rise to $7.50. This level is likely to act as a stiff resistance but if crossed, the pair could rally to $8.75 and then retest $10. The next leg of the uptrend may resume above this level.

Conversely, if the bears sink the price below $4.50, a drop to $3.50 is possible. The selling could intensify if the $3.50 to $2.788 support cracks.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Focus on DeFi ‘fairness’ benefits Holochain, Orion Protocol and Dodo

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