Cryptocurrency and Blockchain Companies Raise $301.9M in February Fundraising
In the month of February, six projects raised a total of $301.9 million, marking a 34% increase from the previous month’s fundraising amount. These projects have announced their plans for the funds raised, which include expanding infrastructure, scaling services, and hiring top talent. TeraWulf, a crypto mining facilities builder, raised $32M in equity funding, which will be utilized for general purposes and expanding its facilities in New York and Pennsylvania. SALT, a blockchain-backed loan provider, raised $64.4M in Series A funding to build a surplus and offer transparency and proof of reserves to win back nervous customers. Carbonplace, also known as the “SWIFT of carbon markets,” raised $45M in seed funding to scale its services to a larger client base of financial institutions and seek partnerships with other carbon market players More here.
Coinbase Stops Initiating Payments From Silvergate
Leading cryptocurrency exchange Coinbase (NASDAQ: COIN) announced on Tuesday that it has stopped accepting or initiating payments to or from Silvergate (NYSE: SI), out of an “abundance of caution” following recent developments. Despite the move, Coinbase has reassured its clients that their funds continue to be safe, accessible, and available. Coinbase assured its clients that all their funds are safe and accessible, and that it will be using Signature Bank for payments in US dollars moving forward and has taken proactive measures to ensure that clients do not experience any impact from this change. The exchange also clarified that client cash is held at FDIC-insured U.S. banks, and when a client has a large dollar balance, Coinbase stores their cash in a U.S. government money market fund to keep it safe and liquid. Details here.
Digital Asset Investment Products Record 5.25% Increase in Assets Under Management (AUM) in February
Digital asset investment products have recorded a 5.25% increase in assets under management (AUM) in February, reaching $28.3 billion, marking the third consecutive monthly increase and the highest AUM recorded since May 2022. This signifies investors’ bullish sentiment and their increased appetite for digital assets, despite the recent SEC enforcements on multiple firms in the industry, including Paxos, Terraform Labs, and Robinhood, among others, as well as macroeconomic setbacks, according to a report by CryptoCompare. The assets under management (AUM) for Bitcoin and Ethereum based products saw an increase of 6.06% and 1.72%, respectively, reaching $20.0 billion and $6.80 billion. As a result, these products now account for 70.5% and 24.0% of the total AUM market share. Read More.
Regulatory Scrutiny in Digital Markets: Insights from EU Antitrust Chief Margrethe Vestager
During a conference organized by Keystone Strategy, EU antitrust chief Margrethe Vestager addressed the growing importance of the metaverse, shared virtual worlds accessible via the internet. With Facebook’s name change to Meta Platforms in 2019, the company signaled its commitment to the metaverse as the successor to the mobile internet. This development raised concerns about Meta’s potential dominance in the new sector. Google and Microsoft are also active in generative artificial intelligence, which is seen as the next bright spot in the industry. Vestager acknowledged the need for healthy competition in the metaverse and questioned what this would look like. Full report here.
Japanese Banks To Launch Stablecoin Experiment For Payment System Compliance
Three Japanese banks are set to conduct a stablecoin experiment using a payment system that complies with legal requirements. Tokyo Kiraboshi Financial Group, The Shikoku Bank, and Minna no Bank plan to issue and remit stablecoin-type electronic money on Japan Open Chain through a system developed by Web3 infrastructure company GU Technologies. According to a press release, the banks intend to promote stablecoins for general consumer use and business-to-business remittances through demonstration experiments involving local governments and private companies. They plan to issue their own stablecoins that can be used in Ethereum wallets like MetaMask while complying with Japan’s new fund settlement laws. More here.
FCA Warnings Prompt UK Banks to Restrict Access to Crypto: Nationwide and HSBC Implement Limits
Nationwide Building Society and HSBC Holdings have implemented new limits on retail customers’ access to cryptoassets, following industry scandals and regulatory warnings. Nationwide Building Society announced Thursday that it would be applying daily limits of £5,000 ($5,965) on debit-card purchases of cryptoassets, and will no longer allow credit cards to be used for crypto purchases. Meanwhile, HSBC Holdings has barred customers from making crypto purchases via its credit cards since last month. “This is because of the possible risk to customers,” HSBC said in an emailed statement to Bloomberg. Both banks cited warnings issued by the Financial Conduct Authority (FCA), which has labeled crypto as high risk for several years. More here.
Senators Demand Answers from Binance over Illegal Financial Activity
A group of bipartisan senators have accused Binance, the world’s largest cryptocurrency exchange, of enabling “illegal financial activity” and avoiding regulatory measures in a letter addressed to CEO Changpeng Zhao and U.S. deputy Brian Shroder. The senators, led by Elizabeth Warren, outlined concerns regarding Binance’s financial information, policies on anti-money laundering, and efforts to limit compliance. The senators called out Binance for concealing financial information and facilitating criminal activity, The Wall Street Journal reported. The letter demanded the exchange provide balance sheets since 2017, estimates of the number of U.S. users on its platforms, and further details on its relationship with U.S. affiliate Binance.US. Read More
FTX Trading Ltd. and its affiliated debtors have revealed that there are major shortfalls in the fiat bank accounts and digital asset wallets associated with the FTX.com and FTX.US exchanges. The company announced that they met with the Official Committee of Unsecured Creditors to discuss this issue and shared a presentation that will be filed on the docket in the chapter 11 cases. According to the presentation, there is a massive shortfall of $2.2 billion in total assets located in the wallets of the accounts associated with the FTX.com exchange, of which only $694 million constitutes “Category A Assets”. At FTX.US, $191 million of total assets have been located in the wallets of the accounts associated with the exchange, in addition to $28 million of customer receivables and $155 million of related party receivables. Read More.
On Thursday, Bitcoin (BTC) briefly faltered as Silvergate Capital (SI), a cryptocurrency-friendly bank, plummeted over 50% in value due to concerns about its future. Nevertheless, BTC made a recovery in the afternoon and is currently trading at $23,500, up by 0.4% over the previous 24 hours. Silvergate Capital, which is located in California, stated in a Wednesday filing that recent occurrences, particularly the FTX exchange collapse and the subsequent regulatory inquiries, raised doubts about the bank’s capability to “continue as a going concern.” This news resulted in at least two sell-side downgrades, and numerous crypto firms stopped doing business with the bank, resulting in a 58% decline in shares by the end of Thursday trading. The second-largest cryptocurrency, Ether (ETH), increased by 0.5% to approximately $1,650. The CoinDesk Market Index (CMI), which gauges the overall performance of the crypto market, rose by 0.06% for the day.
