EverGrow Coin

Ben Strack

The first and largest bitcoin futures ETF is the biggest it’s ever been.&nbsp;



The ProShares Bitcoin Strategy ETF (BITO) reached $1.47 billion assets under management on Tuesday — its highest mark ever.



BITO had <a href="https://blockworks.co/news/bito-on-track-to-be-first-fund-in-history-to-hit-1b-in-aum-in-two-days">quickly grown above $1 billion in assets</a> after launching in October 2021, reaching as high as $1.42 billion in assets the following month, according to YCharts.com.&nbsp;



But the fund’s assets had sunk to as low as about $500 million in November 2022 amid the <a href="https://blockworks.co/news/ftx-meltdown-timeline">collapse of crypto exchange FTX</a> — an event that spurred bitcoin price declines.&nbsp;



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1694" height="710" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=1024&amp;h=1024" alt="" class="wp-image-74641" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=1694 1694w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/BITO-AUM-CHART.jpg?w=80 80w" sizes="(max-width: 1694px) 100vw, 1694px" /><figcaption class="wp-element-caption">BITO AUM chart (source: <a href="https://ycharts.com/companies/BITO/assets_under_management#:~:text=BITO%20Share%20Class%20Assets%20Under%20Management%3A%201.401B%20for%20Nov,22%2C%202023">YCharts</a>)</figcaption></figure>



Its assets under management stood at $850 million as recently as Oct. 12, the YCharts data <a href="https://ycharts.com/companies/BITO/assets_under_management#:~:text=BITO%20Share%20Class%20Assets%20Under%20Management%3A%201.401B%20for%20Nov,22%2C%202023">shows</a>. The fund has seen net inflows of $202 million since that date, according to ETF.com.&nbsp;



Other crypto investment products have seen inflows of late. These products brought in roughly $350 million last week, <a href="https://jbutterfill.medium.com/volume-159-digital-asset-fund-flows-weekly-report-0103828f4a3d">according</a> to CoinShares — the ninth consecutive week of positive flows.&nbsp;



Market appreciation has also contributed to BITO’s asset rise. Bitcoin’s (<a href="https://blockworks.co/price/btc">BTC</a>) price was about $37,750 at 11:30 am ET on Wednesday — up about 130% from a year ago, and roughly 9% in the last 30 days.



Read more: <a href="https://blockworks.co/news/bitcoin-price-mirrors-2012-halving">Bitcoin flirts with breakout, price mirrors lead-up to 2012 halving</a>



<a href="https://blockworks.co/tag/proshares">ProShares</a> investment strategist Simeon Hyman said in a statement that BITO’s asset peak “speaks to the demand for a familiar, accessible and regulated way to target the returns of bitcoin.”



<a href="https://blockworks.co/tag/bito">BITO’s</a> average daily trading volume of $160 million puts it in the top 5% of all US <a href="https://blockworks.co/tag/etfs">ETFs</a>, Hyman added.&nbsp;



But the fund could soon have more competition, as many industry watchers expect the US Securities and Exchange Commission to soon approve ETFs that would hold bitcoin directly — marking a first for the regulator.&nbsp;



<a href="https://blockworks.co/news/sec-decision-date-bitcoin-etf#:~:text=Ark%20Invest%20and%2021Shares%20filed,11.">The SEC’s deadline to rule on such a proposal</a> by Ark Invest and 21Shares is Jan. 10, at which time various segment observers believe the SEC could also greenlight spot bitcoin ETFs from BlackRock, Fidelity, Invesco and others.&nbsp;



Read more: <a href="https://blockworks.co/news/21shares-bitcoin-etf-approval-incoming">Bitcoin ETF saga reaches ‘pattern break’ as amendments pile up</a>



Bloomberg Intelligence analyst Eric Balchunas said during a Nov. 20 segment on Bloomberg TV that BITO’s increase in assets is a bit ironic considering its potential fate.&nbsp;



“This is the ETF that’s probably going to be sort of under pressure, or seeing some exodus, once the spot ETFs come out, because people prefer those,” he said. “But until then, it’s being used in anticipation of those ETFs.”&nbsp;



21Shares president Ophelia Snyder said during a Bloomberg TV interview last week that while she believes spot bitcoin ETFs have “broader appeal,” she doesn’t expect them to make futures-based products obsolete.&nbsp;



Ark Invest and 21Shares 21Shares and Ark Invest <a href="https://blockworks.co/news/spot-crypto-etf-ark-invest-21shares">launched crypto futures ETFs</a> earlier this month.



“I think there’s still a role for futures products to play in this market,” Snyder said. “I think that is a smaller role than what spot will play.”



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BITO hits asset peak as possible spot bitcoin ETF approval looms

Jack Kubinec

SoFi, an online banking platform, has announced that it is discontinuing its cryptocurrency trading service. Customers were notified of this decision via an email sent on Wednesday morning.



The company&#8217;s existing crypto customers will have the opportunity to migrate their assets to Blockchain.com, known primarily for its digital wallet services.



SoFi, a high-yield savings account provider-cum-investing platform, first offered crypto trading in 2019. Until recently however, it has been managing its operations under a two-year conditional approval granted by the Federal Reserve.



The San Francisco-based bank appears to be the first domino to fall following the <a href="https://blockworks.co/news/federal-reserve-crypto-oversight">Fed’s “novel activities supervision program”</a> introduced over the summer. This program imposes stringent requirements on how banks interact with emerging financial technologies, including cryptocurrencies.&nbsp;



A SoFi spokesperson said the decision to end SoFi’s crypto services was spurred by the <a href="https://blockworks.co/tag/federal-reserve">Federal Reserve’s</a> regulatory guidance for its digital asset business following SoFi’s <a href="https://www.sec.gov/Archives/edgar/data/1818874/000181887423000018/sofi-20221231.htm">approval</a> as a bank holding company. SoFi found it increasingly unlikely their crypto business would be fully approved after seeing the Fed’s crypto requirements grow more strict over time, the spokesperson said.



Read more: <a href="https://blockworks.co/news/sofi-crypto-sec-banking">SoFi says ‘no assurance’ of meeting Federal Reserve crypto standards</a>



SoFi customers have <a href="https://x.com/michaelgmcquaid/status/1729866201730601208?s=20">until</a> Dec. 19 to shuttle funds to Blockchain.com, but state regulations will force some out of their crypto investments entirely.&nbsp;



New York residents will be <a href="https://www.sofi.com/invest/buy-cryptocurrency/">forced</a> to sell all their SoFi crypto, while residents in a smattering of other states including Texas have to sell a set of tokens including DeFi-natives AAVE, COMP, MKR, and UNI.&nbsp;



A spokesperson for Blockchain.com said the company saw “tens of thousands” of SoFi customers agree to migrate their crypto to the platform immediately following the announcement. Blockchain.com expects that the majority of SoFi&#8217;s crypto clients will choose to migrate, as selling their holdings could result in tax liabilities.



<a href="https://blockworks.co/news/blockchain-com-raise-110m">Blockchain.com announced a $110 million funding round</a>, the fourth-largest crypto raise in 2023, earlier this month.



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SoFi shutters crypto trading following Fed regulation

Casey Wagner

The US Department of the Treasury has sanctioned a cryptocurrency mixing service the government claims is a key money-laundering tool for the Lazarus Group.&nbsp;



“Sinbad has processed millions of dollars’ worth of virtual currency from Lazarus Group heists, including the Horizon Bridge and Axie Infinity heists,” the Office of Foreign Asset Control (OFAC), the Treasury’s department that oversees sanctions, said in a statement Wednesday.&nbsp;



Sinbad.io, a cryptocurrency mixing service created by an anonymous founder, became a favorite for North Korean-state sponsored hacking organization Lazarus in 2022, researchers from analytics firm Chainalysis said in its last <a href="https://www.chainalysis.com/blog/2022-biggest-year-ever-for-crypto-hacking/">annual report</a>. Researchers from <a href="https://www.elliptic.co/blog/analysis/over-1-billion-stolen-from-bridges-so-far-in-2022-as-harmony-s-horizon-bridge-becomes-latest-victim-in-100-million-hack/hss_channeltw-1344645140">Elliptic</a> agreed, saying in February they believed Sinbad is simply a relaunched version of Blender, the mixer OFAC blacklisted in 2022.&nbsp;



As of Wednesday, the US government had seized Sinbad’s website.&nbsp;



“Mixing services that enable criminal actors, such as the Lazarus Group, to launder stolen assets will face serious consequences,” Deputy Secretary of the Treasury Wally Adeyemo said in a statement Wednesday. “The Treasury Department and its US government partners stand ready to deploy all tools at their disposal to prevent virtual currency mixers, like Sinbad, from facilitating illicit activities.



Read more: <a href="https://blockworks.co/news/stake-hack-lazarus-group-north-korea-fbi">FBI blames North Korea’s Lazarus Group for $40M Stake hack</a>



Lazarus Group was added to <a href="https://blockworks.co/tag/ofac">OFAC’s</a> sanction list in September 2019.&nbsp;



Sinbad was used to launder a significant portion of the $100 million worth of crypto Lazarus stole in June 2023 from customers of Atomic Wallet, OFAC said. Lazarus also used the mixer “to launder a significant portion” of crypto stolen in the $620 million Axie Infinity heist, the office alleges.&nbsp;



“Sinbad is also used by cybercriminals to obfuscate transactions linked to malign activities such as sanctions evasion, drug trafficking, the purchase of child sexual abuse materials, and additional illicit sales on darknet marketplaces,” OFAC added.&nbsp;



The announcement comes as cryptocurrency advocacy groups <a href="https://blockworks.co/news/tornado-cash-fans-appeal">continue to fight OFAC in the courts</a> over the agency’s sanctions against Tornado Cash — a mixing service <a href="https://home.treasury.gov/news/press-releases/jy0916">sanctioned</a> in August 2022 for its alleged role in helping Lazarus launder more than $455 million in stolen funds.&nbsp;



Plaintiffs in two cases are bringing their battle against the Treasury to federal appellate courts. Joseph Van Loon, along with five other self-identified “Ethereum blockchain users” sued the US Treasury Department, Secretary Janet Yellen, the Office of Foreign Asset Control (OFAC) and OFAC Director Andrea Gacki in September 2022. A federal judge in Texas <a href="https://blockworks.co/news/judge-backs-us-treasury-tornado-cash-sanction">sided with the federal government</a> in August, rejecting the argument that OFAC was acting outside its jurisdiction.&nbsp;



Coin Center, Bankless co-founder David Hoffman and others <a href="https://blockworks.co/news/coin-center-sues-over-treasurys-tornado-cash-sanctions">filed a lawsuit against the same federal parties</a> in October 2022. Like in Loon’s case, a federal judge in Florida sided with the US government last month, prompting Coin Center and its co-plaintiffs to file an appeal in the Eleventh Circuit earlier this month.



Updated Nov. 29, 2023 at 11:06 am ET: Modified headline.



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Treasury sanctions crypto mixer Sinbad after money laundering accusations

Cross-chain protocol Wormhole has formally launched a product development-focused unit in tandem with a $225 million fundraise.&nbsp;&nbsp;



The raise gives the interoperability platform a $2.5 billion valuation, the company said in a Wednesday announcement.&nbsp;&nbsp;&nbsp;



Wormhole is backed by investors including Brevan Howard, Coinbase Ventures, Multicoin Capital, Jump Trading, ParaFi, Dialectic, Borderless Capital and Arrington Capital. It was not immediately clear which investors participated in the latest round.&nbsp;



“We&#8217;re laser-focused on bringing solutions to market that solve real problems for our customers and end-users, and are on a mission to enable real-world impact from the Web3 space,” Wormhole Foundation Chief Commercial Officer Robinson Burkey said in a statement.&nbsp;



The Wormhole Foundation also <a href="https://wormhole.com/wormhole-secures-225-million-in-funding-round/">revealed</a> the formal launch of Wormhole Labs Wednesday — an independent tech company to be led by Saeed Badreg. The executive’s LinkedIn <a href="https://www.linkedin.com/in/saeedbadreg/">page</a> says he has been working as Wormhole Labs’ CEO since August.



Bloomberg <a href="https://www.bloomberg.com/news/articles/2023-11-17/jump-spins-off-wormhole-project-shrinking-its-crypto-business?srnd=cryptocurrencies-v2">reported</a> earlier this month that Badreg, along with fellow Wormhole executive — Chief Operating Officer Anthony Ramirez — <a href="https://blockworks.co/news/wormhole-jump-trading-separate">had split from Jump Crypto</a> to run the protocol as an independent entity.&nbsp;&nbsp;



Since launching in 2021, <a href="https://blockworks.co/tag/wormhole">Wormhole</a> has transferred roughly $35 billion in value. It routinely processes 2 million cross-chain messages across 30-plus chains daily, according to the company.&nbsp;



The protocol was <a href="https://blockworks.co/news/in-second-largest-defi-hack-ever-blockchain-bridge-loses-320m-ether">hacked for roughly $320 million</a> last year — at which time Jump Trading crypto arm Jump Crypto <a href="https://blockworks.co/news/wormhole-parent-commits-320m-ether-to-replace-massive-defi-hack-losses">stepped in to replace the funds</a>.



Badreg said in a statement that Wormhole was founded with the vision of a world in which large companies increasingly use public and private blockchains. Such a transformation has started to take shape via <a href="https://blockworks.co/news/real-world-assets-tradfi-defi-tokenization">the tokenization of real-world assets</a>, for example — or as blockchains are used for other use cases to boost efficiency and lower costs.



Read more: <a href="https://blockworks.co/news/jpmorgan-blockchain-payments">JPMorgan adds ‘holy grail’ payments feature as part of blockchain push</a>



Badreg added: “We reaffirmed our commitment to this vision by launching Wormhole Labs, dedicated to advancing the technology that makes efficient blockchain-to-blockchain communication possible.”



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Wormhole garners whopping $2.5B valuation as new unit emerges

Bessie Liu

Crypto investment platform Republic will list its profit-sharing digital asset, the Republic Note, on the Avalanche Blockchain via the US-regulated trading platform INX.



The Note listing will be available to KYC’ed non-accredited and accredited investors worldwide on Dec. 6.



According to David Shack, the head of marketing at Republic, the Republic Note is backed by over 750 private companies and assets in Republic&#8217;s portfolio, including SpaceX, Dapper Labs and Klarna, just to name a few.&nbsp;



“This means that companies that have raised capital on Republic&#8217;s retail investment platform or from Republic Capital (our venture arm) become part of the Note portfolio,” Shack said.&nbsp;



Any users who purchase the Republic Note are entitled to hold a share of the dividend pool that grows when a Republic portfolio company has a profitable exit event.&nbsp;



Aside from financial incentives, Republic Note holders will also have access to community benefits, Shack said.



“Earlier this month, we held a Note-gated community-only event at Republic&#8217;s NYC HQ office, and there are plans for other Note-gated experiences at events like SXSW, ETH Denver, etc,” he said.



The Note has received over $30 million in pre-sale participation from early investors and users, including Naspers, Binance, and the Avalanche Foundation&#8217;s Vista program. Beyond the pre-sale round, an open round with limited availabilities was also open to early Republic users, where an estimated 5,000 investors have already participated.&nbsp;



<h2 class="wp-block-heading">What’s next?</h2>



Shack explains that its decision to launch the Republic Note on Avalanche is aligned with the company’s technical strategy, noting that the company continues to hold a close relationship with Algorand, but Avalanche’s flexibility and customization were necessary for taking the Note to the “next phase of growth” — including a specified subnet that is planned for next year.&nbsp;



“This step was focused on enhancing the asset&#8217;s scalability as the global community of Note-holders grows and its adaptability to and compliance with a dynamic regulatory environment,” he said.



The Note will be the blueprint for Republic as it continues to look into providing ways for companies and institutions to integrate blockchain technology into their business models, Shack explains.



“Republic has always been committed to unlocking private markets, making them accessible to everyone, everywhere,” he said.



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Republic lists profit-sharing digital security on Avalanche

David Canellis

Bitcoin is eyeing a price breakout after clearing $38,200 earlier today, reaching its highest point in 17 months.



That puts bitcoin up 130% this year, far more than almost all other top-25 cryptocurrencies.



<a href="https://blockworks.co/price/btc">BTC</a> only trails bitcoin cash (<a href="https://blockworks.co/price/bch">BCH</a>), chainlink (<a href="https://blockworks.co/price/link">LINK</a>) and solana (<a href="https://blockworks.co/price/sol">SOL</a>), which were up 133%, 163% and 508%, respectively, as of 5am ET.



For scale, bitcoin’s year-to-date gains are in line with Tesla stock and double Intel and Microsoft. 



Chipmaker Nvidia is meanwhile up more than 230% on the back of artificial intelligence hype, which made it the ninth company in history to reach trillion-dollar market value. Crypto’s overall market cap is now close to $1.5 trillion, with bitcoin making up more than half of that total.



Nailing down the exact catalyst for bitcoin’s recent growth is difficult, however.&nbsp;



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
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</div><figcaption class="wp-element-caption">Click the swatches to toggle lines on the chart</figcaption></figure>



The <a href="https://blockworks.co/bitcoin-etf">pending suite of applications</a> for spot bitcoin ETFs from Wall Street mega giant BlackRock and nearly a dozen other firms is one theory. “Spot bitcoin” means they’ll have to actually buy bitcoin when they issue new shares to meet investor demand, which may or may not pick up, depending on which analyst you ask.



Bitcoin indeed jumped by nearly a quarter — from $25,500 to $31,500 — days after BlackRock <a href="https://blockworks.co/news/blackrock-files-bitcoin-etf">filed in June</a>. Low <a href="https://www.bloomberg.com/news/articles/2023-07-06/crypto-quarterly-trading-volume-dropped-to-lowest-since-2019">liquidity</a> led BTC to quickly drop, and by the middle of August had practically given up all those gains.



BTC has popped by half since then. Almost all of that came directly after a <a href="https://blockworks.co/news/blackrock-spot-bitcoin-etf-rumors">fake news headline suggested</a> that BlackRock&#8217;s application had been approved (it hasn’t). 



One month later, a <a href="https://blockworks.co/news/blackrock-xrp-fake-news">phony story about an XRP ETF</a> briefly pumped the fifth-largest crypto by 10%. XRP immediately corrected once the news was debunked.&nbsp;



<h2 class="wp-block-heading">Bitcoin price is correlating with 2012 halving</h2>



Markets are clearly ready to bounce on any good news — like the upcoming halving.&nbsp;



Sometime around April 19, 2024, Bitcoin miners will suddenly earn 50% fewer coins for each block they find, dropping from 6.25 BTC ($238,000) to 3,125 BTC ($119,000).



Bitcoin’s next halving will be its fourth ever. To some, halvings are magic: Previous events — in 2012, 2016 and 2020 — all preceded monumental bull markets.



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<iframe class="wp-embedded-content" sandbox="allow-scripts" security="restricted" title="Interactive or visual content" src="https://flo.uri.sh/visualisation/15936076/embed#?secret=eHTQz9sgaj" data-secret="eHTQz9sgaj" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div><figcaption class="wp-element-caption">Hit the log button for a clearer view</figcaption></figure>



At one year after each halving, Bitcoin had rallied:



<ul>
<li>8,900% after its first halving ($12 to $1,100).</li>



<li>285% after its second ($670 to $2,500).</li>



<li>540% after its third ($8,700 to $55,900).</li>
</ul>



Bitcoin even went up in the 200 days leading up to all three occasions — so no matter how you cut it, BTC’s price has gone up around halvings. 



This time around is even somewhat unique: demand could go up due to a spot ETF just as supply is slashed in half.



Still, buying bitcoin around the halvings is much like buying the rumor with no intention to sell the news. The sample size is incredibly small, leaving little room for reliable analysis of how the halving in April might impact bitcoin’s price.



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
<iframe class="wp-embedded-content" sandbox="allow-scripts" security="restricted" title="Interactive or visual content" src="https://flo.uri.sh/visualisation/15936491/embed#?secret=dupzeERIo8" data-secret="dupzeERIo8" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div><figcaption class="wp-element-caption">Bitcoin&#8217;s performance is so far in line with what happened before the 2012 event</figcaption></figure>



Bitcoin miners, no doubt, hope the next halving mirrors the others. Axing issuance is expected to crush their profit margins, especially those without extremely cheap access to power (or even their own power stations). 



Recent estimates suggest the most efficient bitcoin miners pay $15,100 to mine each coin. That number doubles after the halving, “which would likely put the majority of the mining market into severe income stress,” <a href="https://insights.glassnode.com/the-week-onchain-week-39-2023/">according</a> to data unit Glassnode. 



All this means bitcoin had better stay above $30,000 after the next halving, which is 141 days away. So far, so good.



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Bitcoin flirts with breakout, price mirrors lead-up to 2012 halving

Hut 8 is on track to complete its merger with US Bitcoin Corp this week.



This development is expected to initiate a new phase of geographic diversity and increased revenue streams for the company.



Labeled by executives as a “merger of equals,” the deal was first announced in February. USBTC stockholders voted in favor of the combination, the companies said last week — a key step to finalizing a deal expected to close by Nov. 30.



<a href="https://blockworks.co/tag/hut-8">Hut 8 Mining</a> CEO Jaime Leverton noted during the company’s earnings call earlier this month that USBTC’s US operations — featuring campuses in New York, Nebraska and Texas — are set to complement Hut 8’s current Canadian footprint.



Dan Weiskopf, a co-portfolio manager of the Amplify Transformational Data Sharing ETF (<a href="https://blockworks.co/tag/blok">BLOK</a>), called the combination between Hut 8 and US Bitcoin Corp “a step forward,” noting the combined company will be US-based.&nbsp;



“How the new Hut 8 transforms and works synergies between the two companies remains to be seen, but having spoken to the management at US Bitcoin Corp., I would say there is a plan,” he told Blockworks. “The road to success, however, will involve many pivots, and transformation is not always neat.”



A spokesperson for Hut 8 declined to comment further, and a USBTC representative did not immediately return a request for comment.



The combination brings more business lines into play, Leverton said on the call, as USBTC has fiat-based revenue streams like hosting and managed infrastructure operations.



Read more: <a href="https://blockworks.co/news/hut8-mining-q2-earnings-revenue">Hut 8 endures Q2 challenges, but ‘bullish on a diversified strategy’</a>



The merger, she added, is set to allow the combined business to “flex between our different lines of business and really take advantage of the different momentum and swings we see in the market across high performance computing and bitcoin mining <a href="https://blockworks.co/news/anniversary-of-2016-btc-halving">going into the halving</a>.”



US Bitcoin Corp secured a deal with Celsius Network in August to initially host 8,500 miners at its Alpha site. This came after USBTC was selected in May to manage and operate Celsius-owned assets that included 122,000 mining machines, subject to bankruptcy court approval.



“They have certainly been growing their fee-based revenue lines since we first started talking to them almost a year ago with the managed services business…and then the work that’s being done on <a href="https://blockworks.co/tag/celsius">Celsius</a>,” Leverton said during the Nov. 14 earnings call.



Closing the deal with USBTC, she added, will allow the two teams to decide “our next move from an organic and/or inorganic growth perspective.”



Weiskopf said miners evolving their businesses could be key to their survival.



As Hut 8 and USBTC get set to merge, Hive Digital Technologies recently signaled <a href="https://blockworks.co/news/hive-blockchain-ai-rebrand">a greater focus on artificial intelligence</a> and Marathon Digital <a href="https://blockworks.co/news/marathon-mining-bitcoin-halving">continues to expand geographically</a> and diversify its mining methods.



More recently, Bitfarms <a href="https://investor.bitfarms.com/news-events/press-releases/detail/219/bitfarms-initiates-transformative-fleet-upgrade-that">said</a> Monday it bought nearly 36,000 Bitmain T21 miners as part of “a transformative fleet upgrade plan” — a move Weiskopf called “quite positive.”&nbsp;



The Amplify Transformational Data Sharing ETF, which manages $485 million in assets, has allocations of 2.28% and 1.67% to Hut 8 and Bitfarms, respectively. Hut 8’s stock price has risen nearly 150% year to date and was up about 6% on Tuesday.&nbsp;



“To be a large scale miner you need to be bold and think two steps ahead of your peers who are also your competitors,” he said. “Some miners will not survive the halving, but these two firms are making the tough strategic decisions to hopefully thrive.”



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Merge between Hut 8, USBTC expected to close this week

The US Securities and Exchange Commission has initiated the comment period for Franklin Templeton&#8217;s spot bitcoin ETF proposal.



This move was initiated earlier than some expected, with the SEC now actively seeking public feedback.



New SEC filings could signal its willingness to close out the comment period on such funds ahead of a potential January ruling on bitcoin ETFs, some segment observers said.&nbsp;&nbsp;



A Tuesday disclosure indicates the regulator has chosen to “institute proceedings” to determine whether to approve or deny the Franklin Bitcoin ETF.



“The commission seeks and encourages interested persons to provide comments on the proposed rule change,” the <a href="https://www.sec.gov/files/rules/sro/cboebzx/2023/34-99030.pdf">filing</a> states.



Read more: <a href="https://blockworks.co/news/21shares-bitcoin-etf-approval-incoming">Bitcoin ETF saga reaches ‘pattern break’ as amendments pile up</a>



The SEC has a 240-day window to consider each of the spot bitcoin ETF proposals from the day it is published in the federal register. During this timeframe, specific deadlines occur at intervals of 45 days, 45 days, 90 days, and 60 days. At each of these milestones, the SEC must file a response either approving, denying, or postponing a decision on the proposal.



Franklin Templeton, a traditional finance giant with roughly $1.5 trillion assets under management, <a href="https://blockworks.co/news/franklin-templeton-bitcoin-etf">jumped into the bitcoin ETF race in September</a>.&nbsp;



The Franklin Bitcoin ETF proposal was published in the federal register on Oct. 3, and the <a href="https://blockworks.co/tag/sec">SEC</a> delayed its decision on the product in a Nov. 15 <a href="https://www.sec.gov/files/rules/sro/cboebzx/2023/34-98945_2.pdf">order</a>.&nbsp;



While another filing related to this proposal wasn’t due until Jan. 1, the Tuesday order signals the SEC might be looking to fast-track the process in preparation for a potential mass ruling on spot bitcoin ETFs.&nbsp;



“They might have chosen to do this early so they could have the comment period end before Jan 10, in order to approve everyone at the same time,” Van Buren Capital general partner Scott Johnsson said in an X post.&nbsp;&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">They might have chosen to do this early so they could have the comment period end before Jan 10, in order to approve everyone at the same time. <a href="https://t.co/L5q65I6EDa">https://t.co/L5q65I6EDa</a>&mdash; Scott Johnsson (@SGJohnsson) <a href="https://twitter.com/SGJohnsson/status/1729575861664243928?ref_src=twsrc%5Etfw">November 28, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Jan. 10 is the date by which the SEC is <a href="https://blockworks.co/news/sec-decision-date-bitcoin-etf#">set to rule on a spot bitcoin ETF proposed by Ark Invest and 21Shares</a>. Industry watchers have pointed to this date, noting the securities regulator could approve all spot bitcoin ETFs at this time to avoid giving any one product a first-mover advantage.&nbsp;



The SEC could also choose to deny such proposals — a move that would be consistent with previous rulings over the last decade.&nbsp;



Along with the order related to Franklin Templeton’s proposal, the SEC filed a separate order seeking comments on the <a href="https://blockworks.co/news/hashdex-bitcoin-etf">proposed bitcoin ETF from Brazil-based asset manager Hashdex</a>.&nbsp;&nbsp;



“This delay on<a href="https://twitter.com/hashdex"> </a>[Hashdex] all but confirms for me that this was likely a move to line every applicant up for potential approval by the Jan 10, 2024 deadline,” Bloomberg Intelligence analyst James Seyffart said in a Tuesday X <a href="https://twitter.com/JSeyff/status/1729589130735096088">post</a>.



A spokesperson for the SEC did not immediately return a request for comment.



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SEC kicks off comment period for planned Franklin Templeton bitcoin ETF

A judge has granted Jump Crypto&#8217;s motion to confidentially submit certain materials during the discovery phase in the US Securities and Exchange Commission’s lawsuit against Terraform Labs and its founder Do Kwon.



Federal Judge Jed Rakoff filed the motion in New York Tuesday. Should the court later decide a document needs to be made public, the ruling may be overturned, Rakoff noted in his opinion.&nbsp;



Jump Crypto has been accused of manipulating the price of stablecoin TerraUSD and in turn raking in a $1.28 billion profit.&nbsp;



Terra, according to the SEC, loaned “a US trading firm” 30 million Terra (<a href="https://blockworks.co/price/luna">LUNA</a>) tokens in November 2019 and an additional 65 million LUNA in September 2020. The trading firm in question is Jump Crypto, per a report from The Block.&nbsp;&nbsp;



Read more: <a href="https://blockworks.co/news/terraform-labs-do-kwon-sec-lawsuit">Where things stand: The SEC vs Do Kwon and Terraform Labs</a>



The “loans” were to improve liquidity, Terra said, but the trading firm was “continuously selling LUNA into the market,” the <a href="https://blockworks.co/tag/sec">SEC</a> alleged.&nbsp;



When <a href="https://blockworks.co/news/one-year-since-terra">TerraUSD lost its peg to the US dollar in May 2021</a>, Jump Crypto entered into an agreement to purchase a large sum of the stablecoin in an effort to stabilize its value, according to securities regulators.



“Defendants falsely and misleadingly represented to the public that UST’s algorithm had successfully re-pegged UST to the dollar, giving the investing public the false and misleading impression that the re-peg had occurred without human intervention and misleadingly omitting the real reason for the re-peg: intervention by [Jump Crypto]” the February 2023 complaint reads.&nbsp;



The <a href="https://blockworks.co/news/sec-charges-do-kwon-terraform-labs-with-fraud-misleading-investors">SEC filed its complaint against Terra and Kwon in February</a> this year, about nine months after the Terra ecosystem collapsed. The securities regulator alleges the Kwon “orchestrated a multi-billion dollar crypto asset securities fraud” between April 2018 and May 2022.&nbsp;



In its complaint, the SEC alleges that Kwon and his company deceived investors. They reportedly made false claims that the Korean mobile payment processor Chai used the Terraform blockchain for transactions and settlements. According to regulators, these claims were not true.



Read more: <a href="https://blockworks.co/news/sec-terraform-labs-ust-depeg">Jump Crypto president pleads the Fifth when asked about alleged Do Kwon bribe</a>



Jury selection is scheduled to begin on Jan. 29, 2024 in downtown Manhattan, should the case proceed to trial. Currently, both the SEC and Terra have requested a summary judgment, which, if granted, could result in the matter being settled outside of trial.&nbsp;



<a href="https://blockworks.co/news/judge-denies-terraform-motion-dismiss">Rakoff in July denied Kwon and Terra’s motion to dismiss</a> the case, ruling that the government had made enough of a case against the company and its founder to proceed.&nbsp;



“[B]ecause, according to the well-pleaded allegations of the complaint, the defendants used false and materially misleading statements to entice US investors to purchase and hold on to defendants’ products, and because those products were unregistered investment-contract securities that enabled investors to profit from the supposed investment activities of defendants and others, the motion to dismiss must be denied,” Rakoff wrote in his July 2023 opinion. 



In addition to the SEC’s civil suit against him, <a href="https://blockworks.co/news/do-kwon-indicted-for-fraud">Kwon faces criminal charges in the US</a> in relation to the collapse of the Terraform ecosystem. Kwon is currently serving a four month prison sentence in Montenegro for alleged document forgery. The country approved his extradition earlier this month. Following the completion of his sentence, authorities will decide whether to extradite the founder to the US or South Korea.



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Judge allows Jump Crypto to file Terra documents confidentially in SEC lawsuit

Coinbase stock is on a tear.&nbsp;



Its share price has nearly quadrupled this year, and funds revolving around one particular insider have played the market almost perfectly. Along the way, trusts and funds linked to Coinbase and Paradigm co-founder Fred Ehrsam have so far sold the top, bought the bottom and even taken profits.



Ehrsam initially <a href="https://www.sec.gov/Archives/edgar/data/1679788/000162828021003168/coinbaseglobalincs-1.htm">disclosed</a> ownership of 17.7 million shares leading up to Coinbase’s direct listing in April 2021, split across five entities.



Ehrsam, through a trust in his name, initially sold a little more than 1.4 million <a href="http://blockworks.co/tag/coinbase">Coinbase</a> shares in the months following the company’s direct listing.



The trust netted $472 million with those trades, averaged out to $328.86 per share. <a href="https://blockworks.co/price/coin">COIN</a> would go on to fall 90% from there, briefly sinking below $32 at the start of 2023.



Last week, the trust <a href="http://www.sec.gov/Archives/edgar/data/1679788/000120919123056654/xslF345X03/doc4.xml">sold</a> another 81,530 shares for $106.94 a pop, raking in $8.7 million. Forbes <a href="https://www.forbes.com/profile/fred-ehrsam/">puts</a> Ehrsam’s personal fortune at $1.8 billion.&nbsp;



Coinbase stock sits at about $128 today. What was an $8 billion crypto company in January is now worth more than $30 billion, trailing Spotify but slightly ahead of vaccine-maker Moderna.



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
<iframe class="wp-embedded-content" sandbox="allow-scripts" security="restricted" title="Interactive or visual content" src="https://flo.uri.sh/visualisation/15924739/embed#?secret=U7c85I4sAz" data-secret="U7c85I4sAz" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div><figcaption class="wp-element-caption">Diamonds are buys, circles are sales</figcaption></figure>



Meanwhile, <a href="https://blockworks.co/tag/paradigm">Paradigm</a> has been buying (as has board member and <a href="https://blockworks.co/news/shopify-ceo-spends-3m-on-coinbase-stock-in-2-months">Shopify CEO Tobias Lutke</a>).



Paradigm One LP, of which 35-year-old <a href="https://blockworks.co/tag/fred-ehrsam">Ehrsam</a> was a managing partner until he <a href="https://www.bloomberg.com/news/articles/2023-10-24/paradigm-s-ehrsam-relinquishes-managing-partner-role-at-crypto-focused-vc-firm#xj4y7vzkg">stepped</a> back last month, scooped up more than 1.2 million Coinbase shares across trades made in May 2022 and May 2023.&nbsp;



That’s nearly the same amount of shares that Ehrsam’s trust sold following Coinbase’s direct listing. Paradigm One paid under $77 million for the haul, buying at $62.73 per share on average.&nbsp;



Those shares are currently worth almost $157 million, paper gains of more than 100%. The fund hasn’t yet sold any Coinbase stock, per OpenInsider which compiles US Securities and Exchange Commission filings.&nbsp;



<h2 class="wp-block-heading">Brian Armstrong has sold 2% of his Coinbase stake</h2>



It’s worth stressing that the buying and selling has been split between Paradigm One and Ehrsam’s trust — technically separate entities sold the top, bought the bottom and took profits.&nbsp;



(Most of Ehrsam’s transactions were in line with trading plans lodged with the SEC ahead of time.)



But overall per his disclosures, Ehrsam entities now own a little more than 17.4 million Coinbase shares — almost 99% of his share count before offloading nearly half-a-billion dollars in stock after Coinbase went public. And he has a cool $400 million to boot.



All this while his Coinbase co-founder Brian Armstrong has been <a href="https://blockworks.co/news/coinbase-ceo-stocks-stake">busy fulfilling his pledge</a> to sell 2% of his COIN stake to fund other ventures, including decentralized science startup ResearchHub — which helps <a href="https://blockworks.co/news/brian-armstrong-tokens-for-science">pay researchers in cryptocurrency to do science</a> — and life extension play NewLimit.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I&#39;m passionate about accelerating science and tech to help solve some of the biggest challenges in the world. To further this, I&#39;m planning to sell about 2% of my Coinbase holdings over the next year to fund scientific research and companies like <a href="https://twitter.com/newlimit?ref_src=twsrc%5Etfw">@newlimit</a> + <a href="https://twitter.com/ResearchHub?ref_src=twsrc%5Etfw">@researchhub</a>&mdash; Brian Armstrong 🛡️ (@brian_armstrong) <a href="https://twitter.com/brian_armstrong/status/1581099147855155200?ref_src=twsrc%5Etfw">October 15, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



As of last week, <a href="https://blockworks.co/tag/brian-armstrong">Armstrong</a> has sold nearly 794,000 Coinbase shares since his initial tweet — more than 2% of his COIN stake disclosed to the <a href="https://blockworks.co/tag/sec">SEC</a> in 2021.&nbsp;



Armstrong pulled in $53.7 million with those trades, which averaged out to $67.58 per share. Had he sold the full batch today, Armstrong could’ve made as much as $101 million.



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Coinbase co-founder’s funds are really good at trading Coinbase stock

Ogle

As I was being escorted through the circuitous halls of Mar-a-Lago last weekend, I found myself questioning if I shouldn’t immediately turn around and leave. I had just arrived at the Trump NFT collection gala in West Palm Beach, Florida, with none other than Donald Trump himself in attendance.



It was both an honor and an embarrassment to be there, and I wasn’t sure how exactly I should react. Had my grandfather not been with me (I had brought him and a friend as my guests, both ardent Trump supporters), I probably would have left. But his excitement was palpable, so I continued the long walk to the final resting place of the evening, the famous gilded ballroom.



I’m no fan of Donald Trump. I’ve never loved his bombast, I disagreed with the majority of his decisions as US president, and, as a business owner, I don’t appreciate the ways he supposedly treats those he works with.&nbsp;



But despite these feelings, I spent almost $20,000 purchasing NFTs that directly supported him. It was a classic case of separating the art from the artist — only, in this situation, the “art” of the NFTs was less about aesthetic and more about opportunity to profit during a bear market.



I knew that if Donald Trump was involved in NFTs, they would probably be a great investment— as long as I timed things appropriately. In the long-run, his ventures don’t seem to do very well (Trump Steaks, Trump Shuttle and Trump University being notable failures). But, if one times the entry and exit well, his businesses in the past have done just fine.



I kept this in mind when purchasing the NFTs: Trump will probably pump the prices, so I will sell into the hype. Essentially, I’d use his marketing prowess to enrich myself. The art was unremarkable, the creator controversial, but the potential for profit was undeniable, so I made the decision to purchase.



It paid off.&nbsp;



Of the 200 NFTs I bought, I was able to recoup more than the costs by <a href="https://twitter.com/cryptogle/status/1604268466227273730">selling</a> just one rare NFT. Besides that, I won a round of four of golf at Mar-a-Lago, several copies of his new book and sold many of the NFTs to other collectors during the boom following the release.



But throughout it all, I couldn’t shake the moral quandary going through my head.&nbsp;



While I was happy with the ROI, participating in the project prompted me to deeply reflect on the ethical dimensions of such decisions. When my conservative-leaning family asked me “what was your best investment of the year?” during the holidays, I had to sheepishly admit it was an NFT collection released by a man I had spent years trying to convince them to reconsider their love for.



Even so, attending the gala wasn’t just about political alignment; it was more about familial bonds and an attempt to step out of my “elite bubble.” I justified going to the gala by the fact that my grandfather (who is a staunch Trump supporter) would be able to meet one of his idols. It transformed the event into a generational bridge where our political divides were less central than our familial love.



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="2048" height="1542" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=1024&amp;h=1024" alt="" class="wp-image-74568" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=2048 2048w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=341 341w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=347 347w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=291 291w, https://blockworks-co.imgix.net/wp-content/uploads/2023/11/trumpnftgala.jpg?w=80 80w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Trump NFT gala dinner by Ogle</figcaption></figure>



Sitting down for dinner in the palatial ballroom, I found myself impressed by the refined elegance that surrounded me. They served a three-course meal and seemed to spare no expense. I could imagine the impact the ballroom itself would have made in distinguished meetings of years past. Witnessing the joy of my grandfather in this setting, and especially when he was able to speak with and shake Trump’s hand, completely justified the decision to come.



Read more from our opinion section: <a href="https://blockworks.co/news/crypto-subculture-x-reliance">If we want crypto to succeed, we’ve got to give X the boot</a>



While seeing President Trump speak in person didn&#8217;t sway my stance on his international politics, the crowd’s excitement at his words was enjoyable to experience. I didn’t agree with the guy, but being around excited and happy people is infectious. However, when I posted a picture from the gala to Twitter, the impact it had on my followers was immediate: They decreased in real-time.&nbsp;



Clearly, my presence at the gala was perceived as a deliberate political statement by some, and once again I felt uncomfortable being there.



But I believe that Trump’s involvement in NFTs is a net positive for the industry. It signifies at least a soft endorsement of the space (which we rarely receive from politicians) and serves as a potential catalyst for growth, introducing a previously untapped demographic to the realm of digital assets.&nbsp;



My grandfather&#8217;s newfound curiosity about cryptocurrency and NFTs during and after the gala is testament to this notion. His questions were continuous and his curiosity obvious — and it ended in him deciding it may be wise to invest some of his own money into the space when he’s able.



What started as a simple purchase of NFTs led me to deep assessments of investment ethics, family bonds and political neutrality. It required me to consider a fundamental question: Can one participate in opportunities that conflict with personal beliefs without losing one’s moral compass, or is the act of participation itself an endorsement of those beliefs?&nbsp;



I’m not sure that I have an answer for these questions yet, but I have to thank Donald Trump for indirectly causing me to confront these complexities head-on. The experience stands as a reminder that life&#8217;s most profound lessons can stem from the simplest of actions, often leading us down paths we never anticipated.



One thing I am sure of though: The Trump steak was the best I’ve ever had.



<hr class="wp-block-separator has-alpha-channel-opacity"/>


<div class="wp-block-post-author-biography">Ogle has been an active investor in cryptocurrencies since 2012. He stays busy building different products to benefit the space, including his upcoming networking marketplace Shibuya. He is also building a new blockchain called Glue which focuses on addressing security risks and lack of good user experience in the crypto space. In the meantime, he chases down cybersecurity criminals via his cybersecurity company, Ogle Security Group.</div>


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I attended Trump’s NFT gala. Here’s why it matters

Crypto miner Hive Digital Technologies is repurposing a Sweden data center formerly used by the European Union as a prototype to test energy efficiency and sustainability.



The facility is set to house Hive’s ASIC servers to increase the company’s mining capacity by roughly 300 petahash, Hive Executive Chairman Frank Holmes told Blockworks.&nbsp;&nbsp;



It was previously constructed as part of EU Horizon 2020 — a research and innovation funding program that ran from 2014 to 2020 with a budget of roughly 80 billion euros ($88 billion). Horizon Europe has since <a href="https://research-and-innovation.ec.europa.eu/funding/funding-opportunities/funding-programmes-and-open-calls/horizon-europe_en">succeeded</a> that program.&nbsp;



The goal of what was known as the Boden Type Data Center was “to build the prototype of the most energy and cost-efficient data [center] in the world,” according to a project <a href="https://cordis.europa.eu/project/id/768875">brief</a>.



The prototype comprised a fresh air cooling system and evaporative cooler apparatus “using solely harmonic free renewable energy,” it adds.&nbsp;



Read more: <a href="https://blockworks.co/news/cambridge-bitcoin-electricity-consumption">Why did Cambridge revise its bitcoin electricity consumption index?</a>



Johanna Thörnblad, president of Hive’s Swedish operations, confirmed to Blockworks this former prototype facility is the data center Hive has purchased.&nbsp;



“This data center was initially built together with the Research Institute of Sweden to address the need for more energy efficient data centers,” she told Blockworks in an email. “It has since been expanded to include four additional buildings using low-carbon and locally sourced building materials.”&nbsp;



The site is near <a href="http://blockworks.co/tag/hive">Hive’s</a> existing Boden facility and no more than 500 meters from the city’s hydro plant, Thörnblad said. The data center runs on renewable hydro energy and relies on air and evaporative cooling technologies.



“Hive has always had a strong focus on sustainability and this data center fits very well into our strategy,” Thörnblad added.



HIVE acquired the property with a payment structure that includes up to $750,000 in cash and up to $1.5 million in common shares of the company. According to an <a href="https://hivedigitaltechnologies.com/news/hive-digital-expands-global-presence-with-the-acquisition-of-data-center-facility-located-in-sweden/">announcement</a> from the company, the common shares portion is to be paid in two installments, with the share price determined by specific conditions related to the TSX Venture Exchange&#8217;s closing prices.



Holmes noted the data center was most recently in private hands, declining to disclose the owner. The company, which was involved in high-performance computing, sought to sell ahead of the <a href="https://blockworks.co/tag/bitcoin-halving">bitcoin halving</a> slated for April — an event expected to put financial pressure on segment players.&nbsp;



Read more: <a href="https://blockworks.co/news/anniversary-of-2016-btc-halving">At anniversary of 2016 BTC halving, a look to the next one</a>



The purchase comes just months after the company formerly known as Hive Blockchain Technologies changed its name as it <a href="https://blockworks.co/news/hive-blockchain-ai-rebrand">shifted its focus to supporting the growth of artificial intelligence</a>.



Holmes said the Vancouver-based company looks to continue expanding in British Columbia, Manitoba, Ontario and Quebec. Competitors such as Marathon Digital have recently <a href="https://blockworks.co/news/marathon-mining-bitcoin-halving">shared plans to continue diversifying geographically</a>.&nbsp;



“Buying this facility right beside us is just another long-term vision of the great digital transformation that we’re putting long-term assets on our balance sheet,” Holmes said.



Updated Nov. 28, 2023 at 1:40 pm ET: Modified headline to emphasize Hive&#8217;s bitcoin mining functions.



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Bitcoin miner repurposes former sustainability-focused EU data center prototype

Circle has moved its cross-chain transfer protocol (CCTP) to mainnet on Noble, allowing USDC to be natively minted within Cosmos’ inter-blockchain communication protocol (IBC).



By facilitating easier cross-chain transactions, Circle seeks to improve the utility of USDC, potentially helping to break a prolonged slump in its market capitalization.



Noble joins the likes of Arbitrum, Avalanche, Base, Ethereum and Optimism in allowing native USDC minting via the CCTP. The CCTP is on Solana’s <a href="https://developers.circle.com/stablecoins/docs/cctp-getting-started">testnet</a>.



<a href="https://blockworks.co/tag/circle">Circle’s</a> cross-chain protocol <a href="https://www.circle.com/en/cross-chain-transfer-protocol">lets</a> users create Noble USDC that can be moved to other Cosmos apps like Osmosis or dYdX. The total <a href="https://www.mintscan.io/noble/assets">supply</a> of Noble USDC is already above $20 million, according to MintScan.



The CCTP employs a burn-and-mint mechanism to facilitate the native creation of USDC across different blockchains. In this process, USDC is removed from circulation on the source chain (burned) and then recreated (minted) on the destination chain, based on a verification (attestation) by Circle’s system.



This approach, focusing on direct asset transfer, stands in contrast to token bridging, where assets are locked on one chain in exchange for equivalent wrapped tokens on another. The direct burn-and-mint method has seemingly gained preference over time, particularly in light of <a href="https://blockworks.co/news/rethinking-interoperability-after-string-of-crypto-hacks">multiple high-profile hacks</a> associated with token bridging.



If users want to remove USDC from <a href="https://blockworks.co/tag/cosmos">Cosmos</a> through Circle’s protocol, they must go through Noble. Circle <a href="https://www.circle.com/en/usdc-multichain/noble#:~:text=Noble%20is%20an%20appchain%20purpose,is%20simple%2C%20safe%20and%20seamless.">says</a> trying to move funds to a Circle account from any other app in the IBC “could result in a loss of funds.”



USDC’s market cap is mired in over a year of decline <a href="https://defillama.com/stablecoin/usd-coin">since</a> its $55 billion peak in mid-2022. USDC’s current market cap is $23.68 billion, according to DeFiLlama. Tether (<a href="https://blockworks.co/price/usdt">USDT</a>), the only stablecoin larger than USDC, has <a href="https://defillama.com/stablecoin/tether">grown</a> from $66 billion to $88 billion over the same time frame.&nbsp;



As a centralized company, Circle’s investment in a permissionless cross-chain protocol joins a broader trend of centralized crypto projects <a href="https://blockworks.co/news/cefi-making-defi-leap">bolstering their decentralized finance (DeFi) offerings</a>. 



According to a recent <a href="https://www.bloomberg.com/news/articles/2023-11-07/stablecoin-issuer-circle-internet-said-to-consider-2024-ipo">report</a> from Bloomberg, Circle is considering an initial public offering in early 2024.



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Circle moves native USDC offering to Cosmos mainnet

Cryptos and equities picked up steam Tuesday after an uneventful Monday, setting up traders for a positive end to a strong month.&nbsp;



Bitcoin (<a href="https://blockworks.co/price/btc">BTC</a>) and ether (<a href="https://blockworks.co/price/eth">ETH</a>) were in the green time of publication, both posting gains of around 1.3% and 0.9%, respectively. The S&amp;P 500 and Nasdaq Composite Indexes similarly clocked modest moves, with both up around 0.4%.&nbsp;



Bitcoin has gained close to 9% since the start of the month. The largest cryptocurrency <a href="https://blockworks.co/news/bitcoin-etf-grayscale-sec">rallied more than 5%</a> in the first ten days of November and has spent the past couple weeks jumping between $35,000 and $37,000. In 2022, amid the aftermath of FTX’s bankruptcy, bitcoin closed out November 16% lower.&nbsp;



Ether also saw its biggest moves early in the month, rallying close to 15% in the first nine days of November before paring gains to trade around 10% higher on the month as of Tuesday.&nbsp;



Better-than-expected inflation data pushed cryptos higher this month, analysts from Kaiko Research said. Last week’s news on <a href="https://blockworks.co/news/binance-settlement-message-to-crypto-industry">Binance’s historic $4.3 billion settlement</a> barely <a href="https://blockworks.co/news/binance-news-crypto-rally%5C">tipped the needle for cryptos</a>, in sharp contrast to what the FTX news from one year ago did to markets, analysts added.&nbsp;



“From an outsider’s perspective, the settlement proved grim, but within the industry, there was a sigh of relief knowing that Binance is still able to operate, albeit with increased restrictions and the dismissal of its CEO,” Kaiko researchers wrote in a Monday <a href="https://research.kaiko.com/insights/bitcoin-unbothered-by-binance-settlement">report</a>. “While the exchange reportedly saw outflows of over $1 billion, the immediate impact on volumes and liquidity was muted.”&nbsp;



Looking ahead, continued lower Treasury yields fuel traders’ risk-on attitudes, analysts say, but whether or not the trend is sustainable is up for discussion. Benchmark 10-year notes dropped to 4.35% Tuesday, down even further from Monday’s decline when they dipped from 4.47% to 4.39%. Still, a sustained reduction is unlikely, based on historical precedent, Nicolas Colas, co-founder of DataTrek Research said.&nbsp;



“Any substantial decline in nominal 10-year Treasury yields would have to come from lower real rates rather than reduced inflation expectations,” Colas said.&nbsp;



Since 2004, Colas said, only three conditions have led to real rates declining by 1% or more: recession, Federal Reserve bond buying, and the Fed changing its assessment of future interest rates.&nbsp;



“Since capital markets are not discounting a recession and the Fed is highly unlikely to change its current bond selling program, the only thing that will force real yields lower is a change in policymakers’ belief that ‘higher rates for longer’ is necessary to quell inflation,” Colas said.&nbsp; “As we get more data supporting the idea that inflation is continuing to decline, both bonds and stocks should rally further.”



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Traders ride risk-on sentiment to end November in the green

Macauley Peterson

Decentralization is a spectrum. After years of putting up with relatively centralized critical infrastructure in the node space, the industry is making progress towards achieving a more Web3-native vision.



Lava Network rolled out its Software Development Kit (SDK) Beta on Tuesday, turning the page to a new phase of its testnet. The project serves as a marketplace for high-performance, decentralized blockchain Remote Procedure Calls (RPC) and APIs.



RPC nodes are essential for users interacting with blockchains, but when offered by a few centralized companies, they present a single point of failure. They can also pose problems related to privacy, censorship and data accuracy.



Read more: <a href="https://blockworks.co/news/infura-decentralized-infrastructure-network">Consensys invites Big Tech to decentralized infrastructure network</a>



Unlike most testnets, Lava’s is already serving two hundred node providers, operating on their blockchain’s respective mainnets.



CEO Yair Cleper calls it “kind of Uber for nodes.”



So far, Lava has seen rapid organic growth of demand for the network to replace current public RPCs that are frequently run by ecosystems themselves.



“We call it an incentivized public RPC,” Cleper said, or IPRPC. “We are offering to our community — to our node runners — the option to join the IPRPC on its dedicated chain, and the ecosystem rewards them.”



The protocol, which is backed by leading crypto-native investors like Tribe Capital, Jump Capital, AlphaLab, Hashkey, and Alliance DAO, already supports 30 active <a href="https://allblocks.vercel.app/">chains</a>.



Lava Network itself is a modular layer built as a sovereign app-chain using the <a href="https://blockworks.co/tag/cosmos">Cosmos</a> SDK, and acts as a distribution channel for node providers. It automatically routes requests to the most optimal node available, according to quality of service score.



These scores, tallied by Lava based on latency, availability and “freshness” of the data, are what allows the network to feed reliable and fast data providers to developers and users. This is all done programmatically, based strictly on market forces rather than as a result of off-chain agreements.



The Lava chain tracks service scores and payouts distributed monthly, removing the need for locating nodes and contracting with them individually.



<h2 class="wp-block-heading">On a mission</h2>



Cleper and chief technology office Gil Binder both served in the Israeli army. Cleper is based in Tel Aviv, while Binder moved to New York about 5 years ago. The 2021 edition of the Solana Breakpoint conference was the pair’s first foray into crypto.



They observed shortcomings in infrastructure across the industry.



“There is a natural evolution in the way that the blockchain data is being consumed,” Cleper told Blockworks. “From the beginning — everyone running his own nodes — then going to the centralized provider; they really eliminate the barrier to consume, read, write data, but at the same time, introduce new problems.”



There have been efforts to decentralize the infrastructure stack, including <a href="https://blockworks.co/news/infura-decentralized-infrastructure-network">among the big centralized players</a>, but Lava’s approach to the problem is novel.



First, the Lava SDK is “a peer-to-peer communication protocol, straight from the browser,&nbsp;accessing only the top provider without any middle layer,” Cleper explained, sidestepping the drawbacks of the more centralized status quo.



Second, is a new blockchain primitive which Lava terms, “specs.”



<h2 class="wp-block-heading">Inspecting “specs”</h2>



The introduction of specs enables anyone to permissionlessly add support for new chains, APIs and data services to the network, significantly expanding Lava’s capabilities.



“Everyone can join lava, introduce their own specs and build it while supporting the new upcoming nascent chains,” Cleper said.



In a modular multichain world with potentially hundreds or thousands of app-chains and rollups, centralized node providers simply won’t be able to keep up, he said.



“And we thought, how do we harness the power of community to bring kind of an Amazon algorithm that automatically gives you the best provider constantly scoring the session, the service you give.”



The spec is analogous to categories of items in the Amazon store. Lava aggregates all providers adhering to a given spec, and its quality of service algorithm directly connects the user to the best available option.



To use another analogy, “a spec is like a menu at a restaurant,” Binder said. “It tells you what are the specifications, what data can you get, what&#8217;s the interface to getting the data.”



Node providers are like franchise owners of a restaurant chain with all the same dishes on the menu.



RPC nodes are only the first step, but Binder anticipates a flood of data APIs to use the network, providing structured, indexed data for all sorts of Web3 use cases. The team is in discussions with indexing providers such as <a href="https://subsquid.io/">Subsquid</a>.



Node providers, such as <a href="https://blockworks.co/tag/blockdaemon">Blockdaemon</a>, Chainstack and hundreds of others, get a pro-rated share of rewards based on quality of service. Lava facilitates reputation on-chain, based on verifiable data from the provider’s service.



“We use that reputation to increase how often a provider can get access to users,” Binder said. “It&#8217;s a market — for providers, for consumers, for champions — to bring in these opportunities and then have competition around quality, which results in better service in the end.”



It’s no longer necessary to make the case for decentralized infrastructure. “Everyone agrees with this message that decentralizing RPC, that&#8217;s the way to go, and now the question is executing the best platform that allows these providers to compete,” he said.



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Lava Network heats up the node landscape with market forces

Crypto infrastructure firm Fireblocks is the latest company aiming to ease institutional investors’ counterparty risk concerns following the collapse of centralized crypto giants like FTX.&nbsp;



Via a new product called Off Exchange, Fireblocks will let users lock funds in what it calls Collateral Vault Accounts (CVA), the company said Tuesday.&nbsp;



These accounts are on-chain multiparty computation (MPC) wallets that “programmatically lock and mirror assets” to the connected exchange, according to Stephen Richardson, Fireblocks’ managing director of financial markets.



Once traders transfer assets to a CVA, a credit is issued to the exchange. Crypto derivatives exchange Deribit is the first to integrate with the new offering.



Read more: <a href="https://blockworks.co/news/ftx-meltdown-timeline">FTX began to unravel one year ago today: A timeline</a>



&nbsp;The credit can then be used for spot, margin or derivatives trading activities, and settlement occurs in real-time and on-chain. Once the CVA is rebalanced, traders can withdraw their assets to another venue, counterparty or internal wallet.



“Because the MPC wallets are on-chain, exchanges have complete transparency to monitor and validate client collateral and enforce risk management without taking custody,” he told Blockworks. “This approach protects traders’ principals by enabling them to retain shared custody of their assets in a segregated MPC wallet, and mitigates risk of exposure of funds being commingled in a custodial account or misappropriated by an exchange.”



Some providers use custodial solutions that pool traders’ assets in a commingled account, Richardson noted. In those cases, he said, settlement occurs off-chain via a sub ledger, and exchanges are sometimes required to lock funds in a third-party cold storage solution.



Luuk Strijers, chief commercial officer of Deribit, said in a statement that <a href="https://blockworks.co/tag/fireblocks">Fireblocks’</a> approach is used “to reduce client capital deposited at exchanges while providing our business with greater liquidity and transparency.”&nbsp;&nbsp;



Fireblocks is not the only crypto player who has sought to mitigate counterparty risk after <a href="https://blockworks.co/tag/ftx">FTX</a> imploded last November. FTX founder Sam Bankman-Fried was <a href="https://blockworks.co/news/sam-bankman-fried-found-guilty">found guilty earlier this month</a> on charges including wire fraud, as well as conspiracy to commit fraud and conspiracy to commit money laundering.&nbsp;&nbsp;



More recently, the US Securities and Exchange Commission <a href="https://blockworks.co/news/kraken-commingle-customer-funds">alleged in a lawsuit that Kraken commingled customer crypto assets</a> with its own. The exchange said at the time: “We disagree with the SEC’s complaint against Kraken.”



Bitcoin asset management platform Onramp last month <a href="https://blockworks.co/news/bitgo-crypto-custody-investors">launched a multi-institution custody product</a> that divides key-holding responsibilities to three institutions. Two of the three keys are needed to move the funds at the direction of the end client.



Custodia Bank earlier this month <a href="https://blockworks.co/news/custodia-banking-bitcoin-custody">debuted a custody model</a> in which a customer delegates crypto storage to a custodian that stores the assets on-chain.



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