Crypto weekly update
21. October 2021  • clock 3 min •  Daniel Mitrovsky

First Bitcoin ETF was officially launched – Crypto weekly update

This week, the total market capitalization exceeded 2.27 trillion EUR. Increase at the 7-day interval is 11.27 %. Bitcoin increased by 12.06 % during the week to a current value of over 56,300 EUR. Bitcoin dominance is 46,7 %.

Source: Coinmarketcap

The world’s first Bitcoin ETF

It is finally here. On Tuesday, the first ETF fund – tracking bitcoin futures contracts – officially began trading on the New York Stock Exchange (NYSE).

An ETF fund called “ProShares Bitcoin Strategy ($BITO)” finished its first day of trading with a little over $1 billion (€860 million) of volume. The fund certainly exceeded its expectations, ranking as the second-biggest ETF debut of all time. The BlackRock U.S. Carbon Transition Readiness ETF holds the crown as the most significant influx in one day, with a $1,16 billion (€996 million) trading volume.

According to TradingView data, the $BITO ETF fund opened at $40 and closed the day at $41.94 with a growth of 4.85 % and with a total of 24.313 million shares changing hands, equating to a first-day volume of just over $1 billion (€860 million).

Bitcoin’s price, which has risen to its highest level in the last six months, also responded to the fund’s expected quotation of the first-ever Bitcoin ETF fund. Bitcoin’s price reached a new all-time high at $66,930 (€57,510). Bitcoin price rise boosted expectations that launching an ETF would attract billions of dollars from big investors and pension funds.

Although investors wishing to get indirect bitcoin exposure through $BITO, must watch trading hours of the New York Stock Exchange. Direct bitcoin exposure can be acquired anytime, because Bitcoin trades 24 hours a day, seven days a week. Source

Cosmos announces launch of new blockchain

Cross-chain network Cosmos is building a new blockchain aimed at allowing developers to experiment with different protocols.

In its quarterly keynote report published on Tuesday, Cosmos said its Sagan blockchain was currently in development. According to the published information, Sagan will be the “canary network” of the Cosmos network. Canary networks are networks designed to experiment, identify deficiency or implement various improvements to protocols before they are deployed into mainnet.

Crypto enthusiasts are certainly familiar with a similar case from the Polkadot ecosystem. Polkadot has its own canary network called Kusama, on which protocols are tested and improved, and they will be later deployed on the Polkadot network.

Cosmos has been growing steadily following the March launch of its inter-blockchain communication protocol, which allows crypto assets to be transferred easily between compatible blockchains, including those in decentralized finance. According to data from Mapofzones, there have been 1,285,426 transfers across the Cosmos ecosystem in the last 30 days. Source

Polkadot is ready for parachain auctions

Polkadot’s token $DOT surged to top $40 for the first time in five months after the project set a date for its first parachain auctions, getting closer to a real-world launch of its multi-blockchain framework.

Parachains are separate layer 1 blockchains that can run in parallel and send data to each other. They bring a multichain architecture of several networks to polkadot, and they can enable other layer 1 protocols to seamlessly connect.

A team of developers is currently testing the technology and procedure of parachain auctions on the Kusama canary network to make sure they are fully prepared to launch auctions on Polkadot.

The first round of the auctions is likely to start on 11 November and auctions will run in ten separate rounds until 24 February. Source

Chainanalysis adds bitcoin to its balance sheet

Blockchain analytics firm Chainalysis plans to purchase an undisclosed amount of Bitcoin for the firm’s balance sheet through New York Digital Investment Group’s (NYDIG) brokerage services.

In a Tuesday blog post, Chainalysis said it will expand its partnership with the New York Digital Investment Group, to buy an undisclosed amount of Bitcoin.

“Chainalysis is laser-focused on its commitment to building trust in cryptocurrency as a digital asset, and we are thrilled to be adding Bitcoin to our corporate investment portfolio.” said Chainalysis co-founder and CEO Michael Gronager. “This is Chainalysis’ first acquisition of cryptocurrency, and we will continue to pursue other digital assets as potential future investments.”

The company, which is currently valued at $4.2 billion (€3.6 billion), will follow purchases from companies including Tesla, Square, Voyager Digital, Galaxy Digital and MicroStrategy. Source

CFTC Fines Tether and Bitfinex

The Commodity Futures Trading Commission (CFTC) fined Bitfinex and Tether more than $42,5 million (€36,5 million) on allegations the USDT stablecoin was not fully backed at all times and that Bitfinex violated a previous agency order.

Stablecoin Tether (USDT) was fully covered by reserves for only one quarter, up from 26 months between 2016 and 2018, according to a CFTC press release. In addition, Tether mixed reserve funds with the company’s corporate funds and held reserves in non-cash form.

Tether will pay a total fine of $41 million (€35.22 million), while Bitfnex will pay $1.5 million (€1.28 million), because the company carried out ” illegal, off-exchange retail commodity transactions in digital assets.” In addition, Bitfinex must put in place “additional systems” to ensure it does not facilitate unlawful commodities transactions again.

However, this is not Tether’s first fine. In March, Tether reached an agreement with the New York attorney general’s office to pay an $18.5 million (€15.89 million) fine to settle a closely-watched legal dispute. This was an out-of-court settlement of a case in which Tether moved hundreds of millions of dollars to cover up the Bitfinex´s apparent loss of $850 million (€687.22 million). However, these reserves were intended to backup stablecoin USDT. Source

Facebook partners with Coinbase and Paxos

According to the latest news Facebook has partnered with the cryptocurrency exchange Coinbase and launched its new cryptocurrency wallet.

It looks like Facebook has not given up in its quest to harness the power of the blockchain to expand into the finance business. After failing with its Libra project, the social media giant announced a partnership with Coinbase to roll out its cryptocurrency wallet, Novi.

The launch is still in the testing phase. According to an official statement from David Marcus, Head of Novi, Facebook is launching a pilot of Novi available to a small group of people intending to test the robustness of its service.

Novi will allow users to send and receive Pax Dollars, a US-regulated stablecoin backed by cash reserves and cash equivalents. The funds will be held by Coinbase Custody, and users will be able to exchange their Pax Dollars to fiat currency instantly. So far, the service is only available for the U.S. region. Source

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Daniel Mitrovsky


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