If US regulators approve spot bitcoin ETFs, Ark Invest and 21Shares are well-positioned to rapidly accumulate assets, according to Bloomberg Intelligence analysts.



The Grayscale Bitcoin Trust (GBTC) could also have a leg up — if allowed to launch at the same time — given its current asset base of roughly $23 billion assets under management, according to Bloomberg Intelligence’s James Seyffart and Eric Balchunas.



The US Securities and Exchange Commission is set to rule on the Ark 21Shares Bitcoin ETF (ARKB) by Jan. 10, and industry watchers expect the regulator could greenlight a bunch of other similar offerings at that time. 



The regulator could also choose to deny these applications.   



Segment observers have said a bitcoin ETF, or multiple, could be one of the biggest ETF launches of all-time. A fight for assets between traditional finance giants such as BlackRock, Fidelity and Invesco — not to mention more specialized firms like Grayscale, VanEck, Bitwise and WisdomTree — is set to be fierce.



Flows and volumes are “crucial” to marketing an ETF, Seyffart and Balchunas said in a Wednesday research note. Capital flowing into a fund gives the appearance of success and interest, they added, which can spur other traders and investors to follow. 



With that in mind, the analysts argued that Ark Invest might choose to sell its current positions in the Grayscale Bitcoin Trust (GBTC) and port those assets over to ARKB.



The discount to net asset value at which GBTC’s shares trade has recently shrunk to a two-year low, and Grayscale executives have said such a discount would essentially disappear if it is allowed to convert to an ETF. 



The Ark Next Generation Internet ETF (ARKW) currently holds nearly 4.3 million shares of GBTC — worth roughly $133 million.



“This influx of flows and volumes might come in chunks, which could even be better for ARKB, since it would help make it look as though the ETF was attracting consistent

Ark Invest, 21Shares could jump to bitcoin ETF assets lead: Analysts

A recent initiative by Binance introduces what it describes as “the world's first cryptocurrency triparty arrangement with a third party banking partner.” This project aims to attract institutional clients who prefer not having their capital solely under the control of the exchange.



Ever since the FTX fraud, crypto traders have been leery of assurances by exchanges that they always have all the assets they say they do, backing deposited capital. The concept of proof-of-reserves got a big boost in response as one approach to addressing the longstanding issue of counterparty risk.



That’s a risk retail investors became well acquainted with in 2022, when multiple centralized crypto firms crashed into bankruptcy.



But as Catherine Chen, Binance’s head of VIP and institutional said in a statement, it’s also a major concern in the realm of institutional investment.



Read more: FTX began to unravel one year ago today: A timeline



“Our team of crypto natives and traditional finance professionals has been exploring a banking triparty agreement for more than a year to address their concern,” Chen said.



This new arrangement would allow institutional investors to access Binance’s trading liquidity while placing their trading collateral off the exchange entirely, under the custody of a third-party banking entity. 



But, exactly which bank or banks is not yet clear.



"We are not sharing any additional information regarding our banking partners at this time,” a spokesperson told Blockworks. Binance would only say they “are in discussion with an array of banking partners.”



Binance has been the biggest player in worldwide cryptocurrency exchange for some time, but following its record-breaking $4.3 billion settlement with the US Department of Justice, trading volumes may be waning, even as net outflows remain muted.



While Binance's initiative to replicate a traditional financial framework in the crypto sphere seems promising, it’s also

Binance embraces counterparty risk reduction

Elon Musk is going through it. Crypto might just be the answer.



First, he paid way too much to take Twitter private last year. Now, he’s mugging off the biggest companies in the world — specifically Disney and CEO Bob Iger — for pulling advertising from X after Musk’s comments about Israel and Palestine and concerns about pro-Nazi content.



X, formerly known as Twitter, will go bankrupt over a sustained advertising boycott, the world’s richest man told New York Times DealBook’s Aaron Sorkin at an event overnight. 



“You’re going to blackmail me with advertising money? Go fuck youself,” Musk said.



Okay, Elon Musk, you’ve previously said that X would never launch its own token. And you’ve already dabbled in bitcoin, dogecoin and ether — with Tesla still owning 9,720 BTC ($337 million) as of October.



But if the goal is to pay off your financiers and plug a measly $75 million hole in your advertising revenue, there’s no faster solution than crypto.




This is one of the most extraordinary 5-minute clips I’ve ever seen on this app. An epoch-making exchange.  pic.twitter.com/DbAFF5MkWD— Joel Berry (@JoelWBerry) November 30, 2023
Joel Berry is the managing editor of the Babylon Bee, a satirical outlet previously banned from Twitter



Musk was already Twitter’s biggest shareholder when he first offered to buy Twitter in April 2022 for $44 billion. At $54.20 per share, Musk told the SEC his bid represented a 54% premium on the stock’s valuation before he’d bought his first shares.



Despite initially fighting to renege — on grounds that Twitter hadn’t proved its claim that 95% of daily active users were actual humans and not bots — Musk eventually was forced to follow through as his offer was legally binding.



A raft of executives were immediately fired, including CEO Parag Agrawal, who took over from founder Jack Dorsey in 2021, and Chief Financial Officer Ned Segal, who’d been at the company since 2017.

Hey, Elon, forget about Disney. Save X by launching your own crypto.

Hester Peirce, commissioner at the US Securities and Exchange Commission, isn’t quite sure what her agency’s endgame appears to be. 



“There doesn’t seem to be a rhyme or reason for a lot of cases we bring,” Peirce said Thursday during a fireside discussion at the Blockchain Association Policy Summit in Washington, DC. 



Peirce’s agency brought a total of 784 enforcement actions during the 2023 fiscal year, a 3% increase from 2022, largely thanks to SEC Chair Gary Gensler’s escalating interest in the cryptocurrency space. 



The SEC increased its enforcement actions involving securities offerings by 48% in 2023, one of which was the agency’s case against NFT issuer Stoner Cats 2 LLC.



“I don’t really view it as my primary objective” to stop people from purchasing Stoner Cats, Pierce quipped. 



“We need to just also remember that there's a lot of traditional securities fraud going on, and resources that were spent going after Stoner Cats are not being spent to go after [other actors.],” she added. 



The trend of taking its battles to the courts is not new for the SEC, and Peirce has made her criticism of the strategy known. 



“I will say that litigation is not the most effective way to carry out regulations,” Peirce said during an appearance on Bloomberg TV last week. 



The SEC’s case against LBRY, a saga that eventually ended in the content sharing platform shutting its doors last month, was a particularly troubling instance, Peirce said. 



“I was really heartbroken that we were bringing the case,” she said Thursday. “Here was a project that had actually built a functioning blockchain that was being used…and there had been efforts made to try to launch in a way that was consistent with the securities laws.” 



The SEC has a difficult job determining which enforcement actions to pursue, Peirce said, making the entire process somewhat arbitrary. 



“We have to make resource allocation decisions; where

SEC’s Hester Peirce doesn’t know what her agency is trying to accomplish

MicroStrategy continues to buy bitcoin. The company announced in an 8K filing on Thursday that it had bought roughly $593 million worth of bitcoin throughout the month of November. 



From Nov. 1 to Nov. 29, the company bought 16,130 bitcoin along with its subsidiaries. The average price works out to be nearly $36,000. 



The company now holds roughly 174,530 bitcoin, worth roughly $5.2 billion at a purchase price of $30,000.



Prior to the November buys, MicroStrategy disclosed a huge buy back in June when it bought 12,000 bitcoin over a span of two months at an average price of $28,136 per bitcoin. 



The price of bitcoin (BTC) took a dip following the 8K disclosure, though the price is still above $37,000 at the time of publication. 



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



Back in early November, during the company’s earnings call, MicroStrategy founder Michael Saylor said that the approval — then launch — of spot bitcoin ETFs would be a “catalytic event” that would benefit both his company and other entities with bitcoin exposure. 



“I think we’ll see more and more analyst coverage from traditional Wall Street banks as these ETPs make bitcoin exposure available,” Saylor said on the earnings call. “More coverage means more education, means more awareness, and that results in more interest.” 



MicroStrategy would continue to allow investors to gain exposure to bitcoin through its holdings, and that’s — Saylor believes — is not something that would go away if the world’s largest asset manager BlackRock or any of the other entities vying for a spot bitcoin ETF get the green light from the US Securities and Exchange Commission. 



While it’s unclear what exactly made MicroStrategy so bullish on bitcoin in the month of November, there have been a slew of bitcoin ETF-related headlines. Additionally, the next bitcoin halving is roughly five months away — both of which have been

MicroStrategy bought nearly $600M bitcoin in less than 1 month

US Treasury Deputy Secretary Wally Adeyemo has a message for digital asset firms: Get in line, or end up like Binance. 



“I hoped the digital asset industry would take up this call to partner with government, design new tools and pursue new ways to protect digital assets from being abused,” Adeyemo said at the Blockchain Association Policy Summit in Washington DC Wednesday. 



While many digital asset firms have taken steps toward compliance, others have failed to act. According to Adeyemo, this “represents a clear and present danger for national security.” 



The Treasury Department sent a legislative proposal to Congress on Tuesday asking for additional authority to oversee the crypto space, including allowing it to step outside of the United States. 



Read more: From SBF to Binance: Biggest court cases of 2023



Treasury officials have asked Congress to expand the International Emergency Powers Act to explicitly allow the agency to “designate blockchain nodes or other elements of cryptocurrency transactions,” according to a copy of the proposal obtained by Blockworks. 



Some industry members argue that given the Treasury’s apparent success thus far in sanctioning exchanges, mixing services and other actors, granting the agency greater authority is unnecessary. 



The rules cannot always keep up with the technology, Adeyemo said in response to the criticism. 



“The thing that I learned most from being at Treasury during the financial crisis is that innovation outpaced regulation,” he added. “Our goal is to make sure that we have the flexibility.” 



Read more: Treasury urges crypto companies to ‘prevent’ terrorist financing



Adeyemo’s remarks came hours after his office announced sanctions against cryptocurrency mixing service Sinbad for allegedly facilitating North Korea state-sponsored hacking group Lazarus’ money laundering. 



For illicit actors, the digital asset ecosystem is the “prefered” method of moving

Treasury’s Wally Adeyemo: My agency needs more power to regulate crypto 

The team behind popular decentralized exchange Uniswap has partnered with Talos, an institutional investing technology firm, to bring decentralized finance (DeFi) liquidity to institutional traders.



Uniswap Labs will be providing its Trading APIs to Talos clients in a familiar Talos order book format. There are also plans to enable Talos clients to use the UniswapX ecosystem in the near future. Institutional access to Uniswap will be supported by Fireblocks, a platform designed to store, move, and issue digital assets. 



This latest partnership exemplifies growing institutional interest in crypto assets, driven primarily by the need for market depth and breadth, Roland Jarquio, the vice president of growth and product marketing at Talos told Blockworks.



“Some institutional investors are looking for exposure to certain protocols and projects that can only be traded on DEXs like Uniswap,” Jarquio said. Others, Jarquio notes, are looking to trade at a scale and need deeper liquidity in assets such as ether (ETH). 



Why are institutions interested in DeFi? 



Following Ethereum’s Shapella upgrade earlier this year, many institutions have started to make moves in the DeFi space. 



Generally speaking, DeFi lending protocols offer higher yields than many traditional financial opportunities. 



Liquid staking, for example, allows institutional investors to deposit assets into a proof-of-stake protocol while retaining a token with which they can generate additional yield by providing market-making liquidity. The result is higher-yield-bearing portfolios than they could construct in traditional financial markets. 



A recent report further shows that for certain trading pairs, AMMs such as Uniswap v3 have proven to have deeper liquidity than centralized exchanges. The report highlights that:




For ETH/USD, Uniswap has ~2x more liquidity than both Binance and Coinbase.



For ETH/BTC, Uniswap has ~3x more liquidity than Binance and ~4.5x more liquidity

Uniswap Labs partnership brings institutional access to DeFi

The perpetuals trading platform and layer-1 blockchain, dYdX, is set for a significant event on Friday. Founders, investors, and other key figures involved with the project will gain access to about 150 million previously locked DYDX tokens, currently valued at around $490 million. This unlocking event will increase the circulating supply of DYDX by roughly 80%.



Traditional wisdom says unlocks are bearish, since supply suddenly rises while demand stays static — but DYDX’s price rose 30% this month and open interest grew after dYdX’s chain went to beta mainnet on Nov. 14. 



Ultimately, some of the unlocked tokens will be difficult to sell, and doing so may not be the most profitable strategy for investors, who can stake DYDX for USDC rewards and hedge their bets with short positions. 



A majority of the unlocked tokens will go to past investors in dYdX, which has raised $87 million over four funding rounds, according to Crunchbase. 



Read more: dYdX tokenomics scrutinized as staking goes live



The tokens to be unlocked are also partly allocated in an Ethereum-native version of the token (ethDYDX). There is a one-way bridge for ethDYDX to the dYdX chain, meaning that if investors bridge their tokens to dYdX, they cannot move the tokens back to Ethereum. 



Some of the unlocked tokens will also be native DYDX and wrapped ethDYDX, the dYdX foundation told Blockworks.



Native DYDX holders would have trouble selling their tokens en masse, as DYDX does not currently trade on centralized exchanges. The asset is listed on Osmosis, a decentralized exchange in the Cosmos ecosystem.



However, according to data from CoinGecko, a mere $1600 worth of DYDX sales would lead to a 2% drop in its price. Consequently, attempting to sell large tranches of DYDX tokens would likely result in considerable price slippage, adversely impacting the asset's value.



Regardless of whether the tokens are sellable, Matt Fiebach from Blockworks Research pointed out that DYDX

Why DYDX insiders are unlikely to sell their $490M unlock

Pando Asset is the latest fund group looking to launch a spot bitcoin ETF in the US. 



The Switzerland-based asset manager joins a crowded field of issuers looking to bring to market a type of fund the US Securities and Exchange Commission has never approved. 



The company proposed its Pando Asset Spot Bitcoin Trust in a Wednesday filing. The trust’s  assets would consist primarily of bitcoin held by its custodian — Coinbase Custody Trust company. The disclosure names BNY Mellon as the trust administrator.



A Pando Asset spokesperson did not immediately return a request for comment. 



About a dozen issuers — including traditional finance giants BlackRock, Fidelity and Invesco — have live spot bitcoin ETF filings in front of the SEC.




13 potential #bitcoin ETF Issuers now. Doubt this is ready to go on first day with the others but crazier things have happened I guess https://t.co/W8kfemI6Uc— James Seyffart (@JSeyff) November 29, 2023




Regulators in Canada, Brazil and the Netherlands have approved spot crypto ETFs in recent years. Crypto exchange-traded notes (ETNs) — debt instruments typically collateralized by the underlying exposure, such as bitcoin — have been around even longer.



Read more: US spot bitcoin ETF not impossible — just ask the rest of the world



Pando Asset currently offers three exchange-traded products (ETPs) that trade on the SIX Swiss Exchange, including ones focused on bitcoin and ether. The third allocates to six crypto assets: bitcoin (BTC), ether (ETH), binance coin (BNB), cardano (ADA), solana (SOL) and polkadot (DOT).    



The company is not the first looking to bring its European crypto product expertise to the US. 



21Shares, which also offers a range of ETPs in Europe, has filed for spot bitcoin and ether products with US-based partner Ark Invest. 



The SEC is expected to rule on the proposed Ark 21Shares Bitcoin ETF by Jan. 10. Industry watchers have said the regulator could choose to greenlight a

Spot bitcoin ETF market sees new applicant ahead of SEC ruling

The Securities and Exchange Commission of the Philippines has reminded citizens that Binance is not permitted to operate or offer its services in the country, even though it is trying to. 



“Binance has been actively employing promotional campaigns on various social media platforms to attract and entice Filipinos to engage in investment and trading activities using its platforms,” the Philippines SEC wrote in an advisory Tuesday. 



Binance does not hold the required licenses to advertise and serve customers in the Philippines, the agency added. The Philippines SEC advised citizens to exercise caution when engaging and investing with unregistered entities. 



“Those who act as salesmen, brokers, dealers or agents, representatives, promoters, recruiters, influencers, endorsers and enablers of the Binance platform in selling or convincing people to invest in this platform within the Philippines even through online means may be held criminally liable,” the notice said. 



The news comes days after the US Department of Treasury announced a settlement with the exchange for a historic $4.3 billion. In an unsealed indictment made public last week, the US government accused Binance and CEO Changpeng Zhao of violating anti-money laundering laws, and sanctions laws. 



Read more: Here are the details of Binance and Changpeng Zhao’s plea deal



“Defendants chose not to comply with US legal and regulatory requirements because it determined that doing so would limit its ability to attract and maintain US users,” the DOJ claimed. 



Zhao, who pleaded guilty and agreed to pay $50 million in fines, stepped down from his role as CEO and resigned from the board of directors. The government has asked the court to keep Zhao in the US until his sentencing, which is scheduled for Feb. 23, 2024. He faces up to 10 years in prison. 



Zhao’s legal team has opposed the motion. The judge has not yet ruled.







Don’t miss the next big story – join our free

Philippines issues warning to citizens about using Binance 

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



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



BITO had quickly grown above $1 billion in assets after launching in October 2021, reaching as high as $1.42 billion in assets the following month, according to YCharts.com. 



But the fund’s assets had sunk to as low as about $500 million in November 2022 amid the collapse of crypto exchange FTX — an event that spurred bitcoin price declines. 



BITO AUM chart (source: YCharts)



Its assets under management stood at $850 million as recently as Oct. 12, the YCharts data shows. The fund has seen net inflows of $202 million since that date, according to ETF.com. 



Other crypto investment products have seen inflows of late. These products brought in roughly $350 million last week, according to CoinShares — the ninth consecutive week of positive flows. 



Market appreciation has also contributed to BITO’s asset rise. Bitcoin’s (BTC) 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: Bitcoin flirts with breakout, price mirrors lead-up to 2012 halving



ProShares 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.”



BITO’s average daily trading volume of $160 million puts it in the top 5% of all US ETFs, Hyman added. 



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. 



The SEC’s deadline to rule on such a proposal 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,

BITO hits asset peak as possible spot bitcoin ETF approval looms

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'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 Fed’s “novel activities supervision program” introduced over the summer. This program imposes stringent requirements on how banks interact with emerging financial technologies, including cryptocurrencies. 



A SoFi spokesperson said the decision to end SoFi’s crypto services was spurred by the Federal Reserve’s regulatory guidance for its digital asset business following SoFi’s approval 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: SoFi says ‘no assurance’ of meeting Federal Reserve crypto standards



SoFi customers have until Dec. 19 to shuttle funds to Blockchain.com, but state regulations will force some out of their crypto investments entirely. 



New York residents will be forced 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. 



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's crypto clients will choose