Liquid staking, explained

Liquid staking allows stakers to keep the liquidity of their staked tokens by using a stand-in token that they can use to earn additional yield through DeFi protocols.

Before diving into liquid staking, let’s understand staking and the problems associated with it. Staking refers to the process of locking up a cryptocurrency in a blockchain network to sustain it, and it enables the stakers to earn a profit. However, staked assets typically become illiquid during the staking period, as they can’t be exchanged or transferred.

Liquid staking enables cryptocurrency holders to take part in staking without giving up control over their holdings. This has transformed the way users approach staking. Projects such as Lido introduced liquid staking, offering a tokenized representation of staked assets in the form of tokens and derivatives. 

It allows users to reap the advantages of staking while also retaining the flexibility to trade, trading these tokens in decentralized finance (DeFi) applications or transferring them to other users.

Is there a difference between delegated staking and liquid staking?

Network users in delegated proof-of-take (DPoS) cast votes to select the delegate of their preference. The purpose of liquid staking, however, is to let stakers circumvent the mechanism of minimum staking threshold and locked tokens.

Though DPoS borrows its basic concepts from proof-of-stake, its execution is different. In DPoS, network users are empowered to elect delegates, called “witnesses” or “block producers” for block validation. The number of delegates participating in the consensus process is limited and can be adjusted through voting. Network users in DPoS can pool their tokens into a staking pool and use their combined voting power to vote for the preferred delegate.

Liquid staking, on the other hand, is designed to bring down the threshold for investing and provide a way for stakers to circumvent the mechanism of locked tokens. Blockchains often have minimum requirements for staking. Ethereum, for instance, requires anyone who wants to set up a validator node to stake 32 Ether (ETH) minimum. It also requires specific computer hardware, software, time and expertise, which again requires plenty of investment.

What is staking-as-a-service?

Staking-as-a-service is a platform that serves as a mediator, connecting a blockchain’s consensus mechanism with cryptocurrency holders who want to contribute to the functioning of the network. 

Staking-as-a-service is a platform or service that enables users to delegate their crypto assets to a third party, who then participates in staking on the users’ behalf, usually in exchange for a fee or a share of the rewards. JP Morgan notes that by 2025, the staking services sector will expand to a whopping $40 billion. Crypto staking services will play a large role in this emerging economy, and liquid staking will be an integral part of it.

Staking-as-a-service platforms can be categorized as custodial and noncustodial based on their level of decentralization, which plays a major role in safeguarding stakeholders’ best interests and maintaining transparency. To facilitate decentralized governance, key decisions are made by a decentralized autonomous organization (DAO). 

Custodial staking-as-a-service involves extensive management of the staking process. Staking services offered by crypto exchanges are custodial. Rewards first go to the staking provider before being distributed among stakers.

In the noncustodial staking-as-a-service model, a validator charges a commission to anyone who wants to participate in staking. In PoS networks that support native delegation, the staker’s share of rewards is directly sent to them, with no involvement from the validator. 

How liquid staking functions

Liquid staking is designed to eliminate the threshold of staking and enable holders to make profits with liquid tokens.

Staking pools allow users to consolidate several small stakes into a large one using a smart contract, which gives corresponding liquid tokens (representing their share of the pool) to each staker.

The mechanism eliminates the threshold of becoming a staker. Liquid staking takes it a step further and enables stakers to make double earnings. On the one hand, they earn from the staked tokens, and on the other hand, they make profits with liquid tokens by carrying out financial activities such as trading, lending or any other activity without impacting their original staked position.

Using Lido as a case study will help us understand better how liquid staking functions. Lido is a liquid staking solution for PoS currencies, which supports several PoS blockchains, including Ethereum, Solana, Kusama, Polkadot and Polygon. Lido provides an innovative solution to the hurdles presented by traditional PoS staking by effectively lowering barriers to entry and the costs associated with locking up one’s assets in a single protocol.

Lido is a smart contract-based staking pool. Users who deposit their assets with the platform are staked on the Lido blockchain via the protocol. Lido allows ETH holders to stake fractions of the minimum threshold (32 ETH) to earn block rewards. Upon depositing funds into Lido’s staking pool smart contract, users receive Lido Staked ETH (stETH), an ERC-20 compatible token, which is minted upon deposit and burned upon withdrawal.

The protocol distributes the staked ETH to validators (node operators) within the Lido network, and subsequently, it is deposited to the Ethereum Beacon Chain for validation. These funds are then safeguarded in a smart contract, which is inaccessible to validators. The ETH deposited via the Lido staking protocol is segregated into sets of 32 ETH among active node operators on the network.

These operators utilize a public validation key to validate transactions involving users’ staked assets. This mechanism allows users’ staked assets to be distributed across multiple validators, mitigating risks linked to single points of failure and single validator staking. 

Stakers who deposit Solana’s (SOL) token, Polygon (MATIC), Polkadot (DOT) and Kusama KSM with a set of smart contracts in Lido receive stSOL, stMATIC, stDOT and stKSM, respectively. The stTokens can be used for DeFi yield earning, providing liquidity, trading on decentralized exchanges (DEX) and many other use cases.

Are there any risks associated with liquid staking platforms?

Like any product or service in the crypto space, technical threats and market volatility need to be taken into account when dealing with liquid staking.

Technical threats

PoS blockchains are still relatively new, and there is always the possibility of protocol bugs or vulnerabilities leading to asset loss or exploitation. Reliance on validators for staking also introduces counterparty risks.

Market risks

Liquid staking unlocks the staked assets, enabling stakers to earn rewards from DeFi applications. However, this also opens up the risk of losing on two fronts in a market downturn.

Keeping a liquid staking platform open-sourced and regularly audited helps protect against threats to an extent. Having a bounty program for the platform also helps minimize bugs. 

Conducting comprehensive due diligence is crucial to combat the risks associated with market volatility. This involves researching historical market data, evaluating the financial health of potential investments, understanding the regulatory landscape and developing a diversified investment strategy.

The financial services giant DTCC has stated that it will not allocate any collateral to exchange-traded funds (ETFs) with exposure to Bitcoin or cryptocurrencies and will not extend loans against them.

DTCC’s announcement states that effective April 30, 2024, the Depository Trust and Clearing Corporation (DTCC) will implement changes to collateral values for specific securities during its annual line-of-credit facility renewal, potentially affecting position values in the Collateral Monitor.

This notice released on April 26 means that exchange-traded funds and similar investment instruments with Bitcoin or other cryptocurrencies as underlying assets will not be assigned any collateral value, resulting in a 100% reduction in their collateral value.

However, in an X post, cryptocurrency enthusiast K.O. Kryptowaluty clarified that this would only apply to inter-entity settlement within the Line of Credit (LOC) system.

Source: K.O Kryptowaluty

A Line of Credit is a borrowing arrangement between a financial institution and an individual or entity that allows the borrower to draw funds up to a predetermined credit limit. The borrower can access these funds as needed and typically pays interest only on the amount borrowed.

According to Kryptowaluty, using cryptocurrency exchange-traded funds for lending and as collateral in brokerage activities will continue without impact, depending on individual brokers’ risk tolerance.

While DTCC has taken a stand against crypto ETFs, the same is not valid for other traditional players. Goldman Sachs’ clients have begun reentering the crypto market this year, driven by renewed interest following the approval of spot Bitcoin (BTC) exchange-traded funds.

Related: Bitcoin entering most likely 2 weeks for new BTC price dip — Analysis

The introduction of spot Bitcoin ETFs has spurred increasing institutional interest in this investment product. Within three months of their launch, all United States Bitcoin ETFs have accumulated over $12.5 billion in assets under management (AUM).

In February, an estimated 75% of new Bitcoin investments came from the 10 spot Bitcoin exchange-traded funds approved in the United States on Jan. 11.

Following a healthy launch of Bitcoin ETFs, overall inflows have recently slowed down. In the past three days, multiple ETF issuers reported significant outflows in these spot Bitcoin ETFs. As reported by Farside Investors, spot Bitcoin ETFs in the U.S. saw a net outflow of $218 million on April 25, following a $120 million outflow the previous day.

Grayscale’s GBTC ETF saw a notable single-day outflow of $82.4197 million. According to data from Farside investors, the current historical net outflow for GBTC totals a substantial $17.185 billion.

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The share price of Nvidia (NVDA), one of the biggest producers of graphics processing units (GPUs), has recovered by 15% this week, leading analysts to speculate whether “bottomed out” artificial intelligence (AI) crypto tokens will follow suit.

“This is absolutely insane,” trading resource The Kobeissi Letter declared in an April 27 post on X, while pointing out the major climb seen in Nvidia's market cap within the past trading week:

“The stock has jumped from a low of $756 to $880+, adding ~$320 BILLION in market cap,” it added.

Source: The Kobeissi Letter

Even though AI crypto tokens have faced price drops across the board, analysts are hopeful that Nvidia's strong performance will have a positive effect, as they claim was the case in the previous market cycle.

Pseudonymous crypto trader Crypto Stream explained in an April 26 post on X that his “base assumption” for investing in AI tokens revolves around the performance of Nvidia. Its anticipated Q1 2024 earnings report will be released publicly on May 22.

“Many TradFi investors are probably waiting for this data before making their next move. Don't forget they felt a lot of FOMO when NVIDIA pumped non-stop,” they explained.

Meanwhile, Pseudonymous crypto trader CryptoGodJohn told their 668,100 X followers on April 27 that it “should be an exciting few weeks leading into the Nvidia earnings.” 

“A lot of AI coins looking bottomed out here,” CryptoGodJohn further added.

Render (RNDR) is down 6.89% over the past 24-hours, while Fetch.AI (FET) dipped 6.12% and SingularityNET (AGIX) has declined 5.47% over the same time period, as per CoinMarketCap data.

Related: AI takes center stage as Microsoft and Google earnings signal booming market

NVDA saw a recovery of 15% since the end of trading on April 19, when the stock closed at $762. By the end of the trading week on April 26, the share price had reached $877.

Within the past 24 hours alone, NVDA rose 6.18%, according to Google Finance data.

Source: Google Finance

AI crypto tokens experienced price jumps after Nvidia's strong performance was released in its Q4 2023 earnings report in February.

On Feb. 26, Cointelegraph reported that following Nvidia announcing breakout earnings, AI crypto tokens saw a surge in value. The firm announced revenue and earnings of $22.1 billion and $12.3 billion, respectively, in Q4 2023, representing increases of 265% and 769% compared with Q4 2023.

Just days before, on Feb. 22, it was reported that the total market cap of AI-based tokens swelled by over 9% to $17.8 billion since Nvidia’s quarterly earnings report and has risen from $7 billion earlier in February.

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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

United States regulators have reportedly closed Philadelphia-based Republic First Bank, marking the nation's first banking failure of 2024.

It has sparked debate among the crypto community amid Bitcoin (BTC), Ether (ETH), and several altcoins slightly faltering following the news.

“Another bank just collapsed, the Republic First Bank. Yeah... I think I'll stick to Bitcoin,” CEO of Zesh Marius Martocsan stated in an April 26 post on X.

“Republic First Bank failure is worth a look since bank failures are the best possible narrative we can get for crypto,” pseudonymous crypto trader Pillage Capital claimed in an April 26 post on X.

“How many more need to fail before people start to be their own bank?” crypto commentator Randi Hipper asked her 87,100 X followers on April 26.

After Republic First was reportedly seized by the Pennsylvania Department of Banking and Securities on April 26, the Federal Deposit Insurance Corporation (FDIC) was appointed as its receiver. The agency will take on nearly all deposits and acquire all assets of Republic Bank, according to an April 26 Reuters report.

Republic First reportedly had approximately $6 billion in total assets along with $4 billion in total deposits as at Jan. 31. 

The bank has 32 branches across New Jersey, Pennsylvania, and New York, and will reopen under Fulton Bank's umbrella by the start of next week at the latest.

In 2023, even rumors of possible banking failures saw slight spikes in Bitcoin's price shortly after, however, its price has slightly declined following the news.

Over the past hour, Bitcoin is down 1.16%, trading at $62,715 and Ether is down 0.58% trading at $3,095, as per CoinMarketCap data. 

Bitcoin has been trading below a key support level of $65,000 in the past 24 hours. Source: CoinMarketCap

Meanwhile, altcoins have seen a slightly larger slump in the same timeframe, with Dogecoin (DOGE) down 2.88% and Solana (SOL) down 1.79%.

The news follows a rough year for the banking industry, with five banking failures recorded in the U.S. in 2023, according to FDIC data.

Related: Custodia Bank takes case to higher court after March setback

First Republic Bank, a separate entity, was acquired by JPMorgan in May 2023 after initial recovery efforts failed.

In March 2023, the Federal Reserve announced the closure of Signature Bank, claiming it was in an effort to protect the U.S. economy, citing “systemic risk.”

It came only days after Silicon Valley Bank was ordered to shut down. A week prior, Silvergate Bank, another crypto-friendly bank, announced it would close its doors and voluntarily liquidate itself.

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Our weekly roundup of news from East Asia curates the industrys most important developments.

Chinese national accused of $5.94 billion scam in court

A Chinese national is alleged to have scammed over 130,000 mainland China investors out of 43 billion Chinese yuan ($5.94 billion) and used Bitcoin to launder the proceeds.

Yadi Zhang was apprehended by United Kingdom authorities and, during her appearance at Westminster Magistrates Court on April 20, indicated through a translator that she intended to plead not guilty to two charges of criminal possession of cryptocurrency. She was remanded in custody.

There should be no rush to judgment in this case. Ms Zhang asserts that she is wholly innocent, her lawyer, Roger Sahota of Berkeley Square Solicitors, told the Financial Times.

Previously, her assistant, Wen Jian, a 42-year-old fast food worker in East London, pleaded guilty to charges of money laundering. In 2018, London police seized over 61,000 Bitcoin, now worth $4.0 billion, after raiding the home where two women were living. 

Operating through the company Blue Sky Grid, Zhang allegedly orchestrated one of the biggest Ponzi schemes in mainland China, with over 130,000 victims. Local news reported at the time: 

“Blue Sky Grid was established in Tianjin in 2014. With slogans such as environmental protection development, smart elderly care and Bitcoin mining, the company uses zero-risk and high-interest rebates as bait, conducts product promotion meetings, develops brokers and courses and training, signs investment agreements with the public, and absorbs social funds.

When investors had earned sufficient interest and wanted to withdraw, however, things didn’t go well. 

In 2017, faced with an uptick in redemption requests, Zhang reportedly fled China, first purchasing a Myanmese passport in the name of “Nan Yin” and using the forged document to obtain a genuine St. Kitts and Nevis passport through the countrys citizenship-by-investment program. Zhang then used the Nevisian passport to flee to the U.K. 

Yadi Zhang’s genuine St. Kitts and Nevis citizenship, allegedly obtained through a fake passport. (Weixin)

However, due to her lack of English skills and a disability from a previous accident, Zhang was unable to care for herself in the U.K. and needed an accomplice. Around this time, fast food worker Wen Jian, who was then sleeping in the basement of the East London restaurant where she worked, saw a caretaker job ad posted by Zhang and responded. 

The two women quickly began a mutually beneficial relationship. 

Using Jian’s U.K. identity, Zhang was allegedly able to open legitimate accounts at crypto exchanges and launder her investors capital by purchasing Bitcoin and cashing out to self-custody wallets. Meanwhile, Jian quickly adopted a lavish lifestyle, renting out a luxurious mansion in North London for 17,000 pounds ($21,277) per month. 

However, the saga came to an end after the two women attempted to purchase two historic manors in North London for a combined 36 million pounds ($45 million) but could not explain the source of the funds. This tipped off London police, who became suspicious. 

In 2018, U.K. police raided the home of Zhang and Jian and discovered 48 electronic devices, including laptops, phones and USB sticks that were allegedly used to launder funds into Bitcoin. By 2021, forensic police manage to decipher the devices and gain access to 61,000 Bitcoin valued at $4 billion. The whereabouts of the remainder of the stolen funds are currently unknown. 

It is unlikely that Blue Sky Grid investors will ever get their money back. After the seizure, U.K. police have since applied for civil forfeiture of the Bitcoin, which means that if approved by courts, the stolen Bitcoin will be reverted to the U.K. government and auctioned. 

Chinese nationals barred from Hong Kong crypto ETFs 

Hong Kong regulators have made it clear that mainland Chinese residents will not be able to access Hong Kong spot Bitcoin and Ethereum ETFs after their April 30 launch. 

“No matter the virtual asset futures ETFs currently on the Hong Kong market, or the virtual asset spot ETFs that will be issued in the future, they cannot be sold to retail investors in mainland China and other places where the sale of virtual asset-related products is prohibited,” the citys Securities & Futures Commission said in a statement. 

There is one minor loophole, however: The ban does not include mainland Chinese residents who also have a temporary or permanent residence permit in Hong Kong. Interestingly, all three issuers of the Hong Kong spot crypto ETFs are Chinese off-shore asset managers, and their products are tradable in the Chinese yuan. 

Chinas Anti-Money Laundering laws and Bitcoin ban, enacted in 2007 and 2021, respectively, prevent its citizens from accessing the ETF products in Hong Kong. In recent years, Chinese nationals have increasingly used cryptocurrencies as a means of online gambling, transferring wealth abroad and laundering proceeds of crime. 

The structure of Hong Kong crypto ETFs (Bloomberg)

Philippines SEC cracks down on Binance

The Philippines Securities and Exchange Commission (SEC) has called upon tech giants Google and Apple to remove crypto exchange Binances apps from the country. 

The latest move follows warnings issued by the local SEC in November 2023 and a request to block access to Binances website earlier this year. The SEC has identified [Binance] and concluded that the publics continued access to these websites/apps poses a threat to the security of the funds of investing Filipinos, said SEC Chairman Emilio B. Aquino. 

Authorities have alleged that Binance offered unregistered securities and operated an unlicensed exchange within the country. The SEC had previously advised Filipino investors to withdraw their funds from Binance and instead engage with licensed service providers. 

Binance is currently the largest crypto exchange in the world, with a daily trading volume of $65 billion, covering more than 402 cryptocurrencies and 183 million users. According to the Philippines SEC, users wont be guaranteed to be able to withdraw funds from the exchange after Binance is blocked by internet service providers in the country, likely within three months time. 

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Bitcoin DeFi developer MicrovisionChain (MVC), based in Singapore and Macau, has launched its first asset bridge as part of its efforts to build a fully functional BRC-20 decentralized exchange that supports swaps and token exchanges. 

“The asset bridge addresses the issue of transaction congestion within the Bitcoin ecosystem, which includes BRC20 tokens, Runes, and other assets,” said Jason Kwok, chief operating officer and co-founder of MVC. “We are actively planning to collaborate with renowned custodial institutions and execute strategic campaigns to achieve higher total value locked targets.

The asset bridge allows users to swap Bitcoin and BRC-20 assets with low price impact and instant transaction settlement times using an L2. To perform the swap, users must first wrap their Bitcoin so it is DeFi-accessible. The target asset can then be unwrapped for the respective native tokens post-swap completion. 

Blockchain security firm CertiK has since completed an audit of the MVC protocol. Moving forward, MVC plans to enact a Proof of Build model to incentivize ecosystem developers to build asset bridges, Bitcoin DEXs, wallets, and support for BRC-20 assets on the protocol. Under the proposal, 65% of its native SPACE token would be distributed to builds according to their respective contribution. The project currently has a diluted market cap of $300 million.

The MVC Bitcoin asset bridge interface. (X) Singaporean crypto exchange offers $100M to Titan Chain devs

Singaporean crypto exchange Tokenize Xchange will pledge $100 million worth of its TKX tokens to incentivize developers to build on its native blockchain. 

Dubbed “Titan Chain,” the project integrates interchain communications protocol Cosmos’ software development kit and compatibility with the Ethereum Virtual Machine. The architecture of Titan Chain includes reduced transaction costs, increased scalability, better energy efficiency, and a customizable, developer-friendly environment, wrote Tokenize Xchange staff. 

The firm will also migrate its TKX token, previously minted as an ERC-20 asset, onto Titan Chain starting April 19. Since its launch in 2020, the exchanges token has returned nearly 1,000% and has a fully diluted market cap of $1.3 billion. The exchange was established in 2017 with over 350,000 active users. 

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Yuga Labs CEO Greg Solano had a “tough day,” he informed company employees in a message that he then shared with the world on X. Some of those employees had an even worse day after an all-hands meeting where layoffs were announced. Yuga lost its way, Solano explained.

In his message to the staff, Solano said he had been appraising the company in the two months since he took over as CEO, and his conclusion was unsettling:

“The creative-first spirit that drove this company from inception has been getting muddied by labyrinthine corporate processes. We work hard and we care but somehow end up with groups and committees. We plan more than we ship.”

“Creator royalties were thriving and made our whole ecosystem electric. Now we’re in hard mode,” Solano said, but he has a plan.

Source: Garga.eth (Greg Solano)

Solano said some steps in the reorganization have already been taken, pointing to the spinout of HV-MTL and Legends of the Mara, announced April 17. Game developer Faraway, already a Yuga collaborator, acquired those properties and took Yuga chief gaming officer Spencer Tucker onboard along with them. In his April 26 message, Solano said Yuga would concentrate on developing its Otherside metaverse project.

Related: Judge rejects Ryder Ripps’ counterclaims against Yuga Labs, orders $9M payout

Just before Solano made his announcement, Won Kim announced on X that he had been appointed the Yuga head of brand partnerships. Kim was the co-founder of Bored Room Ventures nonfungible token (NFT) fund and consulting agency, which he left for Yuga, according to his LinkedIn profile.

The X crypto community showed a mixed reaction to the news of the layoffs. Reaction to Solano’s post was overwhelmingly supportive.

Source: FastFoodRembrandt.onion

Trolls came out as well. “I was just laid off from @yugalabs I was the Discord mod responsible for kicking out holders who said anything negative about yuga. I worked 2 hours a day for a $200k salary, mostly fighting milady pfps and spamming gm,” Ricefarmer wrote. They identified themselves as the founder of Ohayo Labs on their X page.

Source: Steve

Yuga pioneered NFT collectibles but has struggled during the evolution of that market. In October, the company underwent restructuring, with a round of layoffs.

Yuga Labs declined to comment further on the situation when Cointelegraph reached out for more information.

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Social media platform X is set to incorporate a wide range of financial services into its ecosystem. Christopher Stanley, X’s head of payments, compared the future functionality of the platform to the combination of Venmo and Apple Pay in an X post on April 22.

Meanwhile, Jack Dorsey’s financial technology conglomerate, Block, is advancing its cryptocurrency initiatives by developing a Bitcoin (BTC) mining ecosystem. The initiative targets key industry challenges, including the high demand for ASIC mining rigs.

On Wall Street, the New York Stock Exchange (NYSE) is exploring the possibility of transitioning to 24-hour trading, similar to the cryptocurrency markets. This change could increase liquidity for traders but also lead to increased volatility for retail investors.

This week’s Crypto Biz examines recent developments, including X’s upcoming payment system, the NYSE’s potential move to 24/7 trading, Block’s expansion into Bitcoin mining and the overall volume of crypto investments.

X payments details released: App to become your bank account

The head of payments at X, Christopher Stanley, outlined an ambitious plan for the platform’s payment system in a recent announcement. X plans to expand its basic tipping service into a comprehensive financial ecosystem. Initially, the service will resemble Venmo, allowing users to send and receive money within the app. Over time, the capabilities will expand to include features typically associated with bank accounts, such as earning interest on stored funds, according to Stanley. X plans to evolve into a system where users can buy products and make in-store purchases similar to Apple Pay, generating economic activity within its ecosystem.

Source: Christopher Stanley NYSE gauges interest in 24/7 stock trading like crypto: Report

The NYSE is exploring the possibility of extending its trading hours to 24 hours a day, similar to the cryptocurrency markets. The NYSE’s data analytics team has conducted a survey to gauge the interest of market participants in moving to 24/7 or continuous weekday trading. The survey also seeks feedback on what measures should be implemented to safeguard traders against potential price volatility during overnight trading sessions. Currently, the NYSE, along with other major exchanges like Nasdaq and the Chicago Board Options Exchange, operates from 9:30 am to 4:00 pm Eastern Time, Monday through Friday.

Block announces development of “full Bitcoin mining system”

Block, the payments company previously known as Square, has announced the development of a new Bitcoin mining system. This initiative stems from Block’s completion of a three-nanometer chip specifically designed for BTC mining, following an earlier prototype of a five-nanometer BTC mining chip developed in May 2023. Block aims to offer both a standalone mining chip and a complete mining system to support the decentralization of Bitcoin mining, it said. The company is advocating for a decentralized approach to Bitcoin mining and is inviting inputs from the mining community on issues such as the acquisition of miners, maintenance, transparency and software challenges.

Crypto investment products see outflows for second consecutive week — CoinShares

Investments in digital asset funds have continued to decline, marking the second consecutive week of significant withdrawals. According to CoinShares, a total of $206 million was withdrawn between April 15 and 19. Bitcoin exchange-traded funds saw the largest decrease, with $192 million withdrawn ahead of the halving event. Ether funds also experienced a decline, with a $34 million outflow, continuing a six-week trend of negative flows. Additionally, investment in blockchain equities dropped for the 11th week in a row, totaling a $9 million loss. This trend of outflows is attributed to investor concerns over rising interest rates in the United States, which make traditional, less risky financial instruments more appealing than the more volatile cryptocurrencies. Current economic conditions and inflation data suggest the Federal Reserve’s hopes to ease monetary policies by mid-2024 may be unlikely.

Crypto Biz is your weekly pulse on the business behind blockchain and crypto, delivered directly to your inbox every Thursday.

The crypto lawyer currently running a Senate campaign to unseat Elizabeth Warren has filed a brief in support of Coinbase appealing a matter in its case against the United States Securities and Exchange Commission (SEC).

In an April 26 filing in U.S. District Court for the Southern District of New York, John Deaton filed an amicus brief in support of a motion for interlocutory appeal on behalf of 4,701 Coinbase customers. According to the brief, the lawyer filed the document pro bono to represent the interest of Coinbase customers rather than the exchange itself.

Source: Courtlistener

Deaton listed previous enforcement actions taken by the SEC as evidence the regulator “does not speak on behalf of digital asset users and investors and intends to offer no regulatory guidance beyond citing the Howey case.” He cited the commission’s civil cases against Debt Box, in which he claimed the SEC was “more interested in hurting a crypto company than maintaining an allegiance to truth and justice.” A judge sanctioned the commission in that case.

Though an April 26 X post directly tied Deaton’s actions to his ongoing Senate run, he initially pitched himself as a legal representative to Coinbase customers in June 2023 — before his campaign announcement — after the SEC filed its lawsuit. An April 19 filing suggested that his latest motion to file an amicus brief was successful.

“It is extremely important for end users of the technology to be represented and not allow a biased and politically motivated agency speak for them,” said Deaton on X. “But that doesn’t mean they want Coinbase to speak for them either.”

Related: SEC sues Bitcoin miner Geosyn, accusing founders of $5.6M fraud

According to Coinbase Chief Legal Officer Paul Grewal, the interlocutory appeal asked the court to consider whether the term “investment contract” — one of the bases for establishing whether something is a security under SEC rules — requires contractual obligations after a sale. The legal issue is among many at stake in the SEC’s case against the crypto exchange.

It’s unclear if Deaton’s legal work could impact his Senate campaign, with election day less than six months away. Both candidates for the Massachusetts seat in the U.S. Senate have markedly different views on digital assets. Senator Warren signed an April 25 letter calling for authorities to crack down on the use of crypto in payments for child sexual abuse material.

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Inoming rules for decentralized finance protocols in Europe could raise significant barriers to crypto-native projects while encouraging licensed traditional financial institutions to get on board, predicts Marina Markezic, executive director of the European Crypto Initiative.

During an interview with Cointelegraph, Markezic discussed the European Commission’s upcoming DeFi report, which is due Dec. 30, 2024. The report is under the Markets in Crypto-Assets (MiCA) framework and will examine the feasibility of specific regulations for the DeFi ecosystem.

“We think that this regulation will facilitate those [traditional] players to come into this crypto space. We know that some banks are already thinking of issuing stablecoins,” Markezic said in response to the expected impacts of a DeFi regulatory framework, adding that:

“Whatever we have seen over the years being developed [...] now it’s coming from this institutional point of view, and definitely will be harder for all the crypto native projects to get licensed and be compliant.”

Related: Upcoming DeFi rules in Europe could ban non-decentralized protocols

The EU's report aims to examine how decentralized systems should be regulated, particularly those without a clear issuer or service provider, such as decentralized exchanges. As a major outcome of the report, it may provide initial definitions of what constitutes decentralization in the eyes of regulators.

“We argue that the situation is very much not that type of a black and white scenario, but rather DeFi presented as a spectrum,” Markezic contends.

This ‘DeFi spectrum’ would encompass a variety of different use cases, ranging from fully decentralized systems, where there is no control or human intervention and operate independently, to systems that exhibit various degrees of control and management.

Rather than laying out strict rules for the sector, legal experts are advocating for clear standards. “I think it is critical for governments, policymakers, and the industry to first align and agree on what really constitutes DeFi,” Sascha Drobnjak, former head of legal and compliance at the Elusiv protocol, told Cointelegraph.

Drobnjak explained that transforming proposed measures into enforceable regulations poses additional challenges. “How and to whom can a regulator impose supervisory measures without a tangible actor in the system? What does it even mean to be tangible?” He continued:

“The more a regulation is based on certain standards and principles rather than rigid rules, the easier it is to apply to future technological innovations.”

DeFi describes financial services that operate on public blockchains, primarily on the Ethereum network. Essentially, it recreates services offered by banks and financial institutions (like lending, borrowing, trading or insurance) but operates without having those institutions as intermediaries.

The DeFi market is expected to expand in Europe in the coming years. Statista predicts the DeFi sector will generate approximately $6.69 billion in revenue in 2024, with a compound annual growth rate of 9.67% between 2024 and 2028, reaching $9.68 billion in revenue in 2028.

Magazine: 1 in 6 new Base meme coins are scams, 91% have vulnerabilities

The United States Department of Homeland Security (DHS) recently announced the formation of an Artificial Intelligence Safety and Security Board composed of a veritable who’s who of tech CEOs, academics, and influential business leaders. 

Created under the direction of U.S. president Joseph Biden, the purpose of the new board is to advise DHS secretary Alejandro Mayorkas and the White House on matters related to artificial intelligence. Specifically, the board will “develop recommendations to help critical infrastructure stakeholders,” and “develop recommendations to prevent and prepare for AI-related disruptions to critical services that impact national or economic security, public health, or safety.”

CEOs from Adobe, Alphabet, Anthropic, AMD, AWS, Cisco, IBM, Microsoft, Nvidia, Delta Air Lines, Humane Intelligence, Occidental Petroleum, and Northropp Gruman make up the business sector of the board. They’re joined by academics from universities, civil rights and humanitarian institutions, the mayor of Seattle, Washington, and the governor of Maryland.

Notably, neither Mark Zuckerberg, the founder and CEO of Meta, nor Elon Musk, the CEO of Tesla, appear as members of the board despite heading up artificial intelligence companies associated with the other technology firms on the list.

Secretary Mayorkas said, in a statement, that he was grateful for the participation of the U.S. AI sector’s elite:

“Artificial Intelligence is a transformative technology that can advance our national interests in unprecedented ways. At the same time, it presents real risks— risks that we can mitigate by adopting best practices and taking other studied, concrete actions. I am grateful that such accomplished leaders are dedicating their time and expertise to the Board to help ensure our nation’s critical infrastructure—the vital services upon which Americans rely every day—effectively guards against the risks and realizes the enormous potential of this transformative technology.”

According to a document published by DHS, the board’s primary function is to advance “responsible development and deployment” of AI technologies.

While the AI sector continues to boom in the U.S. market, it remains largely unregulated in comparison to the E.U.’s tech industry. Analysts question whether Europe’s more hands-on approach to regulating firms operating within its economic area better serves citizen security and privacy.

Welcome to Finance Redefined, your weekly dose of essential decentralized finance (DeFi) insights — a newsletter crafted to bring you the most significant developments from the past week.

The past week in DeFi saw BNB Chain announce native liquid staking on its BNB Smart Chain (BSC). The move is set to help ecosystem participants secure the network while keeping the liquidity of their assets.

DeFi protocol Chainlink launched a cross-chain protocol that makes cross-chain smart contracts more interoperable across nine blockchain networks.

In other news, Arkham Research flagged nearly half a dozen DeFi wallets with millions in assets stuck in DeFi bridge contracts.

BNB Chain will enable native liquid staking on BSC

BNB Chain said it would enable native liquid staking on its BNB Smart Chain as part of its shift to migrate the BNB Beacon Chain’s functions to BSC as the former is wound down.

In an announcement sent to Cointelegraph, BNB Chain noted that the BNB Beacon Chain will be completely shut down by June 2024. However, the company said it will transfer its features to the BSC before it closes.

BNB Chain said that enabling liquid staking on BSC will allow ecosystem participants to secure the network while keeping the liquidity of their assets. While the organization did not give a specific date for the rollout of the liquid staking feature, BNB Chain said it will happen in April or May.

Continue reading

Chainlink debuts new protocol aimed at boosting cross-chain interoperability

Chainlink’s Cross-Chain Interoperability Protocol (CCIP) has entered general availability to foster more cross-chain connectivity. The protocol lets developers use CCIP permissionlessly for cross-chain token transfers and arbitrary smart contract messaging across different blockchain networks.

Developers will also be able to send and trigger function calls on smart contracts deployed on other blockchains, making cross-chain smart contracts more interoperable.

CCIP’s mainnet general availability will enable a faster and easier implementation for developers, bolstering cross-chain connectivity, according to Sergey Nazarov, co-founder of Chainlink.

Continue reading

EigenLayer on the brink of potential yield crisis

EigenLayer, the largest restaking protocol on Ethereum by total value locked (TVL), could be facing a “major” yield crisis, according to industry watchers.

Due to EigenLayer’s rapid growth in TVL, the protocol may be outgrowing its Actively Validated Services (AVS), which could lead to a major yield reduction, according to Chudnov, a pseudonymous builder at 3Jane derivatives exchange.

EigenLayer removed the limits on all liquid staking tokens (LSTs) on April 16, according to an X announcement. EigenLayer launched on mainnet on April 10.

When a user stakes an LST via EigenLayer, it is automatically delegated to a node operator, which uses the deposits to secure an AVS on EigenLayer while receiving staking rewards.

Part of the staking rewards are passed on to the user. Yet AVS on the protocol require much less staked Ether for security, which could lead to issues in the future.

Continue reading

Wallets linked to Coinbase and Vitalik Buterin have millions “stuck” in bridge contracts

Dozens of crypto whale wallets with assets ranging from six to seven figures are stuck on multiple DeFi bridge contracts.

Arkham Research reported that most of these bridge protocols are native contracts and thus require the users to manually retrieve funds, which many of these whales have forgotten. The firm also tagged and asked linked users to check if they could access and retrieve funds stuck for months.

One of these whale wallets is linked to Ethereum co-founder Vitalik Buterin, who has over $1 million worth of assets stuck for over seven months. Another wallet linked to Coinbase also appears to have been forgotten for several months, and some other wallets have assets unclaimed for over two years.

Continue reading

DeFi market overview

Data from Cointelegraph Markets Pro and TradingView shows that DeFi’s top 100 tokens by market capitalization had a bearish week, with most trading in the red on the weekly charts. The total value locked in DeFi protocols fell below $100 billion.

Thanks for reading our summary of this week’s most impactful DeFi developments. Join us next Friday for more stories, insights and education regarding this dynamically advancing space.

Bitcoin (BTC) held above $63,000 on April 26 despite facing a slew of negative influences. These include significant outflows from spot Bitcoin exchange-traded funds (ETFs) over two days, heightened regulatory scrutiny marked by an FBI warning against unregistered crypto services, and efforts by U.S. Senators to scrutinize cryptocurrency transactions.

On April 25, spot Bitcoin ETFs in the U.S. saw a net outflow of $218 million, which followed a $120 million outflow the previous day, as reported by Farside Investors. Notably, Franklin Templeton was the only provider to record inflows on April 25, indicating that the trend of withdrawals cannot solely be attributed to high fees at Grayscale GBTC.

U.S. Senators Elizabeth Warren and Bill Cassidy sent a letter on April 25 to the U.S. Department of Justice and the Department of Homeland Security. They sought details on measures being employed to tackle the issue of pseudonymity in cryptocurrency payments for child abuse material. The senators referenced a report from Chainalysis and emphasized the need for punishment for those selling such illicit content.

Bitcoin can ignore negative economic forecasts

Bitcoin bulls are drawing optimism from deteriorating global macroeconomic conditions, particularly after the U.S. personal consumption expenditure (PCE) increased by 2.8% year-over-year in March. This rise in inflation, which surpasses the target set by the U.S. Federal Reserve (Fed), is particularly alarming given that U.S. gross domestic product growth for the first quarter was lower than expected at 1.6%.

These figures bolster market expectations that the Fed will maintain higher interest rates for an extended period, as reported by CNBC. George Mateyo, chief investment officer at Key Wealth, noted, "The prospects of rate cuts remain, but they are not assured, and the Fed will likely need weakness in the labor market before they have the confidence to cut."

According to Lawrence MacDonald, founder of “The Bear Traps Report,” interest payments as a percentage of federal spending in the U.S. are projected to increase to 12.3% in 2024, up from 9.8% in 2023. Additionally, recent government bond auctions have shown a tepid response from investors, resulting in the 5-year U.S. Treasury yield reaching its highest levels in nearly six months on April 25.

Bitcoin investors are wary of the unsustainable trajectory of U.S. government fiscal policies as the Fed faces a dilemma. Lowering interest rates to alleviate the debt burden could lead to higher inflation, which would further strain consumers and businesses, leaving the Fed in a precarious position.

The deteriorating macroeconomic conditions extend beyond the U.S. to other major economies. On April 26, Japan, the world’s fourth-largest economy, witnessed a significant devaluation of its currency, the Japanese yen, reaching its lowest level since 1990. Additionally, Japan’s consumer price index for April showed a 1.8% inflation rate, which was lower than expected, casting doubts on consumer strength, as reported by Reuters.

Source: Geiger Capital

A user on the X social network, @Geiger_Capital, pointed out that the Bank of Japan (BOJ) is constrained from raising interest rates due to the country’s staggering 265% debt-to-GDP ratio. While a weaker yen benefits exports, it adversely affects domestic consumption. Crucially, as the largest holders of U.S. Treasurys, Japanese investors’ movements exert considerable pressure on the global economy.

Ultimately, Bitcoin’s price has been negatively affected by outflows from U.S. spot ETFs, regulatory pressures, and global economic downturns. However, some analysts believe that the weaker global economic conditions may lead to additional stimulus measures by central banks, which could be beneficial for Bitcoin given its properties of scarcity and resistance to censorship.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Custodia Bank has filed a notice of appeal with the United States Tenth Circuit Court of Appeals, challenging a lower court’s decision from March denying its attempt to officially join the U.S. banking system.

According to an April 26 court filing, the bank is seeking a federal-level appeals court's review of a decision by Judge Scott Skavdahl of the District Court for the District of Wyoming. The decision dismissed Custodia’s request for a Federal Reserve master account in the United States.

Federal Reserve master accounts are accounts held by a financial institution directly with the Federal Reserve Bank. Having a master account gives banks access to Federal Reserve services such as Fedwire and the Automated Clearing House (ACH) network for electronic payments. In 2022, Fedwire processed approximately 196 million transfers, worth more than $1 quadrillion.

Custodia Bank notice of appeal. Source: Custodia Bank

Caitlin Long, a former executive at Morgan Stanley and an early Bitcoin proponent, founded the bank in 2020 to provide account services for crypto firms and act as a bridge to the United States dollar.

Custodia applied for a Federal Reserve master account in October 2020. Nearly two years later, in June 2022, the bank sued the Fed, alleging an “unlawful delay” in its application processing.

In 2023, the Fed rejected the membership application, noting that the bank’s involvement in the crypto space was “inconsistent with the required factors under the law.” Recently, on March 29, Judge Skavdahl ruled against granting the bank an account and dismissed its plea for a declaratory judgment.

Custodia Bank says that lacking a master account prevents it from providing the same custodial services for digital assets as other banks, limiting its competitiveness. Several banks in the U.S. offer custody of digital assets, such as the Bank of New York Mellon.

In a separate filing, the bank objects to a bill of costs submitted by the Federal Reserve Bank of Kansas City. The bill seeks reimbursement for $25,728.25 in deposition transcript costs. Custodia argues that these costs should not be awarded at this stage of the legal proceedings.

Magazine: The legal dangers of getting involved with DAOs

Cryptocurrency exchange Binance and former CEO Changpeng “CZ” Zhao have filed notice with the court in its case with the United States Securities and Exchange Commission (SEC) to establish the government’s position on stablecoins as a security.

In an April 25 filing in U.S. District Court for the District of Columbia, lawyers for Binance and CZ filed a Notice of Supplemental Authority, bringing the court’s attention to the U.S. government’s arguments in its criminal case against Mango Markets exploiter Avraham Eisenberg. In that case, prosecutors argued there was “no factual basis” for treating USD Coin (USDC) as a security or putting the question to a jury.

Source: Courtlistener

The Justice Department used the argument against USDC as a security in its case against Eisenberg, who was found guilty of fraud and market manipulation on April 18. Having the government claim that a stablecoin was not a security seemingly under the SEC’s regulatory reach could bolster Binance’s arguments in the civil case. 

The scope of the argument seemed limited to USDC, while the SEC’s case against Binance included BNB BNB and the stablecoin Binance USD (BUSD). The lawsuit, filed in June 2023, alleged that the crypto exchange and CZ allowed unregistered offers and sales of BNB and BUSD, as well as Binance’s Simple Earn, BNB Vault and staking programs.

Binance’s case with the SEC was ongoing at the time of publication, but the exchange and CZ settled with the U.S. Justice Department, Treasury Department and Commodity Futures Trading Commission in November 2023 for $4.3 billion. Zhao stepped down as CEO of the crypto exchange and pleaded guilty to one felony count as part of the deal. He is scheduled to be sentenced on April 30.

The crypto exchange remains under scrutiny from regulators and authorities across the globe. Two Binance executives were arrested in Nigeria after the firm said it intended to cease all transactions in the local fiat currency, the naira. Authorities in Canada also filed a class-action lawsuit against Binance on April 19, alleging the exchange sold unregistered crypto derivative products.

Magazine: Lazarus Group’s favorite exploit revealed — Crypto hacks analysis

Bitcoin (BTC) continues to trade inside a large range, suggesting indecision about the next trending move. Analysts trying to predict the direction are enthused by the $1.3 billion of USD Coin (USDC) transferred to Coinbase by whale addresses. Expectations are that the funds will be used to buy Bitcoin and Ether (ETH).

Large investors are not only buying the top two coins by market capitalization. CoinShares head of research James Butterfill said in a recent report based on a survey of 64 institutional investors that 15% of the respondents had invested in Solana (SOL). In comparison, none of the investors held Solana in the firm’s January survey.

Crypto market data daily view. Source: Coin360

Morgan Creek Capital CEO Mark Yusko said in a recent interview with The Wolf Of All Streets podcast that about $300 billion of baby boomers’ wealth is likely to enter into digital assets within 12 months. This inflow could boost the cryptocurrency market capitalization to $6 trillion.

Can buyers thwart attempts by the bears to deepen the correction in Bitcoin and altcoins? Let’s analyze the charts of the top 10 cryptocurrencies to find out.

Bitcoin price analysis

Bitcoin has been trading below the moving averages for the past few days, but the bears are struggling to sink the price to the crucial support at $60,775. This suggests that selling dries up at lower levels.

BTC/USDT daily chart. Source: TradingView

The price is stuck between the 50-day simple moving average ($67,404) and the vital support at $60,775. The 20-day exponential moving average ($65,542) has started to turn down and the relative strength index (RSI) is just below the midpoint, indicating a minor advantage to the bears.

A break and close below $59,600 could open the doors for a drop to the 61.8% Fibonacci retracement level of $54,298.

This bearish view will be negated in the near term if the price rises above the 50-day SMA. The BTC/USDT pair may then climb to $73,777. This remains the key overhead resistance for the bulls to overcome.

Ether price analysis

Ether has been oscillating between the 20-day EMA ($3,209) and the horizontal support of $3,056 for the past few days.

ETH/USDT daily chart. Source: TradingView

This tight range trading is unlikely to continue for long. If the price pierces the 20-day EMA, the ETH/USDT pair could rise to the 50-day SMA ($3,436). This level may act as a short-term barrier, but it is likely to be crossed. The pair may then jump to $3,679.

Conversely, if the price turns down and breaks below $3,056, it will suggest that the bears are in command. The pair may then retest the critical support at $2,852. A Break below this level may result in a decline to $2,700.

BNB price analysis

BNB (BNB) has been struggling to reach the overhead resistance of $635, suggesting that the bears are defending the level with vigor.

BNB/USDT daily chart. Source: TradingView

However, a positive sign is that the bulls have not rushed to the exit. The price may pull back to the moving averages, where it is likely to find support. If the price rebounds off the moving averages with strength, it will enhance the possibility of a break above $635. If that happens, the BNB/USDT pair could surge to $692 and eventually to the pattern target of $775.

On the other hand, if the price slides below the moving averages, it will indicate that the range-bound action may extend for a few more days.

Solana price analysis

Solana (SOL) turned down from the overhead resistance of $162 on April 24, indicating that the bears are active at higher levels.

SOL/USDT daily chart. Source: TradingView

The 20-day EMA ($153) is sloping down gradually, and the RSI is in the negative zone, indicating that the bears have the edge. The SOL/USDT pair could descend to the solid support at $126. If the price rebounds off this level with strength, it will indicate that the pair may remain sandwiched between $126 and $162 for a while longer.

The first sign of strength will be a break and close above the 50-day SMA ($168). That will open the doors for a possible rally to $205. Contrarily, a break below $126 could sink the pair to $100.

XRP price analysis

XRP (XRP) is trading below the 20-day EMA (0.54) but the bulls are trying to find support at the uptrend line.

XRP/USDT daily chart. Source: TradingView

If the price bounces off the uptrend line and breaks above the 20-day EMA, it will suggest that the bears are losing their grip. The XRP/USDT pair could then attempt a rally to the 50-day SMA ($0.59) and subsequently to $0.69.

Contrary to this assumption, if the price continues lower and breaks below the uptrend line, it will suggest that the bears are in control. The pair may plunge to $0.46, where the bulls are expected to provide strong support.

Dogecoin price analysis

Dogecoin (DOGE) has formed a symmetrical triangle pattern, indicating indecision between the bulls and the bears.

DOGE/USDT daily chart. Source: TradingView

The downsloping 20-day EMA ($0.16) and the RSI in the negative zone suggest that the path of least resistance is to the downside. If the price skids and maintains below the triangle, the DOGE/USDT pair may tumble to $0.12.

On the contrary, if the price turns up from the current level and breaks above the triangle, it will signal aggressive buying on dips. That improves the prospects of a break above the downtrend line. The pair may then climb to $0.21.

Toncoin price analysis

Toncoin (TON) broke below the ascending channel pattern on April 22 and reached the 50-day SMA ($5.12) on April 25.

TON/USDT daily chart. Source: TradingView

The downsloping 20-day EMA ($5.82) and the RSI just below the midpoint suggest that the bears have a slight edge. If the price rebounds off the 50-day SMA, it is likely to face stiff resistance at the 20-day EMA. If the TON/USDT pair turns lower from the 20-day EMA, it will increase the likelihood of a drop below the 50-day SMA. The pair may then drop to $4.50.

This negative view will be invalidated if the bulls push the price back into the channel. Such a move will suggest that the recent breakdown may have been a bear trap.

Related: Here’s what happened in crypto today

Cardano price analysis

Cardano (ADA) turned lower from the 20-day EMA ($0.50) on April 23 and reached the important support at $0.46.

ADA/USDT daily chart. Source: TradingView

If the price rebounds off the $0.46 level and rises above the 20-day EMA, it will suggest that the correction may be over. The ADA/USDT pair could then rally to the 50-day SMA ($0.59) and later to $0.68.

Instead, if the price continues lower and breaks below $0.46, it will indicate that the bears remain in charge. The pair could then slump to the crucial support at $0.40. A break below this level may resume the downtrend.

Avalanche price analysis

Avalanche (AVAX) turned down from the 20-day EMA ($39) on April 24, but the bears are finding it difficult to pull the price below the uptrend line.

AVAX/USDT daily chart. Source: TradingView

The bulls will have to push and maintain the price above the downtrend line to signal a potential short-term trend change. The AVAX/USDT pair could then attempt a rally toward the 50-day SMA ($47).

This optimistic view will be negated in the near term if the price continues lower and breaks below the uptrend line. That could sink the pair to the $32 to $27 support zone, where buyers are likely to step in.

Shiba Inu price analysis

Shiba Inu (SHIB) has been stuck between the moving averages for the past few days, indicating indecision between the bulls and the bears.

SHIB/USDT daily chart. Source: TradingView

The flattish 20-day EMA ($0.000025) and the RSI near the midpoint do not give a clear advantage either to the bulls or the bears. If the price breaks and maintains below the 20-day EMA, it will indicate that the bears have seized control. The SHIB/USDT pair may then slump to $0.000020.

Alternatively, if the price rises and breaks above the 50-day SMA ($0.000027), it will signal that the bulls have overpowered the bears. The pair may then attempt a rally to $0.000033.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Equity exchange network Cboe Global Markets has announced plans to reorganize its digital assets trading operations, including eliminating its digital spot market.

Cboe said it will remove digital asset derivative trading from Cboe Digital and integrate it into its Global Derivatives and Clearing businesses. The Cboe Digital Spot Market will close in the third quarter of 2024. The exchange will move cash-settled Bitcoin and Ether futures contracts from the Cboe Digital Exchange to the Cboe Futures Exchange in the first half of 2025, subject to regulatory review and “certain corporate approvals.”

The Cboe Digital clearing arm, Cboe Clear Digital, will be “aligned” with Cboe Clear Europe under the unified leadership of Cboe Clear Europe president Vikesh Patel. The exchange said in a statement that:

“These changes are being made as part of Cboe's strategic review, taking into consideration the lack of regulatory clarity in the digital space, and are aligned with Cboe's longer term strategy.”

Cboe Digital offers Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), USD Coin (USDC) and Litecoin (LTC) products. The potential status of ETH as a security may be a factor in the current reorganization.

The exchange went on to note that it would enjoy significant savings from closing its digital spot trading arm. It called the $2-million to $4-million savings it would experience in 2024 an “immaterial impact” on its 2024 net revenue, but added that savings would reach $11 million to $15 million annually.

Related: Decentralized dilemma: Could Ethereum survive if SEC ruled ETH a security?

"We expect to continue to see greater demand for exchange-traded [digital asset] derivatives to help manage crypto exposures, hedge risk and enhance capital and operational efficiencies,” Cboe Global Markets global president David Howson said.

Source: Kaiko

Cboe greatly expanded its presence in the digital asset space through the May 2022 acquisition of ErisX, which operated a spot market, derivatives market and clearing platform and was transformed into Cboe Digital. The timing of that deal was unfortunate, as the crypto winter was just around the corner.

In August 2022, Cboe declared a $460 million goodwill impairment in its second-quarter earnings results due to its acquisition of ErisX. A goodwill impairment is the amount a company loses from buying an asset for a sum greater than the asset’s book value when the value of that asset later declines. In November 2022, Cboe Digital brought 13 investor partners into the business.

Magazine: DeFi, derivatives and fixing an antiquated financial system: Kristin Boggiano

Bitcoin (BTC) slid lower into the April 26 Wall Street open as familiar trading conditions kept bulls in check.

BTC/USD 1-hour chart. Source: TradingView Bitcoin ETFs see "rough day"

Data from Cointelegraph Markets Pro and TradingView showed BTC price action coming full circle from highs of $65,300 into the daily close.

A stubborn trading range retained power over the market amid problematic macroeconomic data and weak performance from the United States spot Bitcoin exchange-traded funds (ETFs).

These saw net outflows in excess of $200 million the day prior, extinguishing what was initially a promising start to the week.

“Rough day across the board for the Cointucky derby and the Bitcoin ETFs yesterday,” James Seyffart, a dedicated ETF analyst at Bloomberg, wrote in coverage on X (formerly Twitter).

“5 ETFs saw outflows for a total of -$217 million. Franklin was only ETF with an inflow at $1.9 million.”

Bitcoin ETF flows chart. Source: James Seyffart/X

Amid a lackluster mood across crypto, some market participants began to suggest that an overall Bitcoin price trend could stay absent for a longer period.

Source: Crypto Chase

In his latest X analysis, however, Michaël van de Poppe, founder and CEO of trading firm MNTrading, argued that altcoins would diverge significantly to deliver long-awaited gains.

“Bitcoin is still stuck in a range. I don't think we'll see much happening from here for the coming 3-6 months. Slow sideways, perhaps a grind,” he predicted.

“Expecting way more from Altcoins.”

Bitcoin market dominance 1-week chart. Source: TradingView

Bitcoin’s dominance of the overall crypto market cap circled 55% on the day, having come down after peaking at 57% — its highest level in two years — on April 13.

Analyst: Next two weeks classic time for BTC price lows

Updating his monitoring of BTC price performance around the block subsidy halving, meanwhile, popular trader and analyst Rekt Capital gave a two-week deadline for any more significant dips to occur.

Related: Bitcoin bull market may return in $1.4T US liquidity spike — Prediction

“In this cycle, Bitcoin has entered the Post-Halving ‘Danger Zone’ (purple) and is very near the Range Low,” part of his latest commentary explained.

“If additional downside volatility below the Range Low is to occur, it would be during these upcoming two weeks.”

BTC/USD chart. Source: Rekt Capital/X

An accompanying chart compared behavior during the 2024 halving to historical norms.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Crypto conferences are hotspots for people who accumulated vast wealth by taking advantage of the rapid growth of digital assets.  At Token2049 in Dubai, United Arab Emirates, Cointelegraph's Bradley Peak caught up with attendees to uncover the secrets behind their wealth.

The stories he heard were as diverse as the people themselves. Some were lucky or smart enough to invest in Bitcoin (BTC) early on, riding its surge and cashing out at the right moment. Others proudly declared themselves as "diamond hands," holding onto their Bitcoin through thick and thin, reaping the benefits as its value soared.

In the crowd were savvy traders who navigated the complexities of financial instruments like options and futures contracts, turning their expertise into profits. And then there were the fintech entrepreneurs who had built successful ventures within the crypto space, now enjoying the rewards of their hard work.

Each attendee’s path to wealth was unique, shaped by their decisions, risk tolerance, and entrepreneurial spirit. Bradley Peak’s interviews offered a glimpse into these diverse journeys of financial success in the crypto world.

For those eager to learn more on how wealth is made in the digital age, check out the full video on Cointelegraph's YouTube channel with firsthand accounts from crypto conference attendees. 

American rapper Marshall Mathers, better known as Eminem, has become one of the latest celebrities to tout cryptocurrency exchange Crypto.com.

In an April 26 X post, Eminem released an ad spot showing a boxing training montage interspersed with crypto jargon, including proof-of-work and Crypto.com’s now infamous slogan “fortune favors the brave.” The rapper was one of the first major celebrities to advertise for the cryptocurrency exchange since actor Matt Damon’s ad spot in October 2021.

Source: Eminem

It’s unclear under what terms Eminem became the latest celebrity voice to push crypto in the United States following a significant market downturn in 2022, the high-profile collapse of FTX and its former CEO Sam Bankman-Fried, and the U.S. Securities and Exchange Commission stepping up enforcement actions against digital asset firms. The rapper was a member of the Bored Ape Yacht Club and purchased a nonfungible token (NFT) for $462,000 in 2021. 

In Damon’s Crypto.com ad spot, he appeared amid a digital landscape of historical figures, including the Wright brothers and Sir Edmund Hillary. At the time, the exchange was one of the fastest-growing firms in the crypto space, arranging many sponsorship deals, including renaming Los Angeles’ Staples Center to the Crypto.com Arena — the backdrop for Eminem’s video.

Related: Celebs who got burned endorsing crypto and those that got away with it

Many Hollywood celebrities and sports stars have appeared in high-profile advertisements for crypto firms only to later reassess their role. More than a year after the ad aired, Damon said he only did it to raise money for Water.org, a clean water initiative. Comedian Larry David, who in 2022 appeared in a Super Bowl ad for now-bankrupt crypto exchange FTX, later said he was “an idiot” to do it.

Reactions to Eminem touting crypto appeared to be mixed on social media. Many users created parodies of the rapper’s lyrics to better fit the crypto space — e.g., “Will the real Satoshi please stand up?” — while others questioned whether his sponsorship would turn out differently than Damon’s. The price of Crypto.com’s native token Cronos (CRO) was seemingly unaffected by the release of the ad spot.

Magazine: Gordon Goner on his dramatic health battles and Bored Apes turning 3

Bitcoin (BTC) printed a bull flag on the daily chart, a technical chart pattern associated with strong upward momentum for the asset. Could it signal the start of the post-halving bull run?

Bitcoin bull flag suggests more upward momentum: Analyst

Bitcoin printed a bull flag pattern on the daily chart on April 26, according to an X (formerly Twitter) post by popular crypto analyst Mikybull, who wrote:

“Bitcoin on a daily chart forming a bull continuation pattern. According to Wyckoff's law of cause and effect "the longer the consolidation, the more explosive the markup will be."

BTC/USD, 1-day chart. Source: Mikybull

The current chart formation is “a strong bullish setup,” according to Denis Baca, financial analyst and head of product at Zivoe. Baca told Cointelegraph:

“We're seeing a bull flag on Bitcoin's daily chart, which historically suggests more upside. It’s shaping up nicely after a solid rally, with declining volume indicating a pause before potentially shooting towards $100,000.”

However, Bitcoin is unlikely to rally higher in the absence of a significant catalyst, according to Andrey Stoychev, the head of prime brokerage at Nexo. He told Cointelegraph:

“After testing $64,000 more than once on the day, only to confirm it as resilient support, Bitcoin does signal the potential for a further climb upward. Despite that, any significant price rises could remain unrealized, with Bitcoin merely reaching the upper bands of the established trading range of around $67,000.”

Traders should keep an eye on the $65,000 Bitcoin price level. A move above this level would liquidate over $500 million worth of cumulative leveraged short positions, according to Coinglass.

Bitcoin Exchange Liquidation Map. Source: Coinglass

Related: Bitcoin outperforms Tesla stock for the first time since 2019

Could Bitcoin price dip below $60k before the bull rally?

While Bitcoin has seemingly formed strong support above the $60,000 mark, a potential dip below could still happen before rallying to new highs, according to Baca. He said:

“Historically going into May, we see Bitcoin fade to retest support of the 20-week [small moving average] SMA, which would put Bitcoin at $56,000. I think such a move would be healthy before going higher. It’s exactly these kinds of dips that can offer solid buying opportunities before the next climb to record highs.”

However, Nexo’s Stoychev doesn’t expect Bitcoin to fall below $60,000, unless U.S. interest rates remain high for more than expected. He said:

“Unless there is a long period of high interest rates affecting sentiment towards digital assets for the remainder of 2024, it’s unlikely that Bitcoin will retrace that far back.”

If Bitcoin price potentially falls below $60,000, it would liquidate over $1.4 billion worth of cumulative leveraged long positions, according to Coinglass.

Bitcoin Exchange Liquidation Map. Source: Coinglass

Related: Bitcoin’s daily transactions reach new record high

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