2024-07-25 21:16

“The question on whether Crypto/Bitcoin is here to stay is largely over + crypto/Bitcoin won,” said Jersey City Mayor Steven Fulop in a tweet. The municipal pension plan of Jersey City, New Jersey, will soon invest in bitcoin via exchange-traded funds, according to a Thursday social media post from Mayor Steven Fulop. While it's not likely to be a gigantic sum, the decision is another symbolic win for cryptocurrency on the road toward wider adoption. The move follows a Wisconsin pension making a similar decision earlier this year. Fulop, who has been the mayor of Jersey City since 2013, took to X (formerly Twitter) to announce the forthcoming investment, writing: “Not my normal subject matter in a post but I’ll share anyway – the question on whether [c]rypto/Bitcoin is here to stay is largely over [and] crypto/Bitcoin won.” Fulop, a Democrat, has thrown his hat into the ring for New Jersey’s 2025 gubernatorial election. Incumbent Governor Phil Murphy, also a Democrat, has already served two terms and is ineligible for reelection. Fulop added that the city’s pension fund, the Employees Retirement System of Jersey City, is currently in the process of updating paperwork with the U.S. Securities and Exchange Commission (SEC) to allocate a percentage of the fund to bitcoin (BTC) ETFs. According to Fulop’s tweet, the investment is expected to be completed “by end of the summer.” Though Fulop did not specify exactly how much of the pension funds' assets under management will be allocated to bitcoin ETFs, he said it would be “similar” to the 2% allocation to bitcoin ETFs made by Wisconsin’s state pension fund earlier this year. Fulop did not specify which bitcoin ETF Jersey City was considering selecting for its investment. “I’ve been a long time believer (through ups/downs) in crypto but [b]roadly, beyond crypto [I] do believe blockchain is amongst the most important new technology innovations since the internet,” Fulop said. Interest in bitcoin from public pension funds is growing slowly but surely. Wisconsin’s public pension plan – the State of Wisconsin Investment Board, which has roughly $156 billion in assets under management – is the biggest pension plan to dive into crypto so far, with a $160 million investment into spot bitcoin ETFs earlier this year. Some small pension funds like the Houston Firefighters’ Relief and Retirement Fund, which has about $5 billion in assets under management, have been invested in crypto for several years. The pensions of Fairfax County, Virginia, also invested in crypto exposure through VanEck's New Finance Income Fund, which became a creditor to crypto firm Genesis as it filed for bankruptcy last year. Outside of the U.S., public pension plans including Japan’s $1.4 trillion Government Pension Investment Fund, the largest pension plan in the world, put out a request for information on bitcoin investments earlier this year. “I’m sure eventually it will be more common,” Fulop said of pension funds allocating to crypto in his tweet. The Jersey City Mayor’s Office did not respond to CoinDesk’s request for comment by publication time. https://www.coindesk.com/policy/2024/07/25/jersey-city-to-invest-in-bitcoin-etfs-the-latest-pension-to-dive-into-crypto/

2024-07-25 19:55

Bitcoin is benefiting from massive economic imbalances, rising distrust in institutions, fiscal recklessness and mounting debt burden, VanEck's Matthew Sigel said in an interview. By 2050, bitcoin may settle 10% of international trade and 5% of local trade gain with central banks' holding it as a reserve asset, asset manager VanEck said in a report. Bitcoin layer-2 networks will play a key role to overcome scaling issues and allow BTC to be used as a medium of exchange, the firm said. There are risks for bitcoin's growth, including rising power demand, concerted government crackdowns and competition with other digital assets, the report said. Asset manager VanEck, an issuer of spot bitcoin (BTC) and ether (ETH) ETFs, says that BTC's price may reach $2.9 million by 2050 – assuming some pretty high hurdles are cleared. Under VanEck's assumptions in a Wednesday report, bitcoin would become an essential part of the international monetary system in the next decades as rising geopolitical tensions and ballooning debt servicing costs erode the current system. "As we look at the world right now, we see enormous economic imbalances, rising distrust in existing institutions and continued deglobalization," Matthew Sigel, head of digital asset research at Van Eck and one of the report's authors, said in a Wednesday interview on CNBC. "We think many of these distortions stem from ... a massive misallocation of capital since the global financial crisis as G7 governments have abused the printing press, spending borrowed money on impossible goals," Sigel explained. "Bitcoin ... is the ultimate hedge against this rising fiscal recklessness," Sigel said. In the report's base case scenario, BTC would become a key medium of exchange in local and global trade, representing 10% of international trade settlement and 5% of GDP. Meanwhile, it would also gain as a global reserve asset at the expense of the four largest foreign reserve currencies – the U.S. dollar, euro, British pound and Japanese yen – reaching a 2.5% weight in international currency reserves. If things play out as VanEck envisions, bitcoin's price will increase in value by 44 times, gaining 16% annually from its current price of just below $65,000. Its market capitalization would soar to $61 trillion. The proliferation of layer-2 networks will play a key role in overcoming the Bitcoin blockchain's bottlenecks and scaling issues that prevent BTC from being a useful medium of exchange, the report said. The sector could collectively be worth $7.6 trillion by 2050, applying the same valuation framework as for Ethereum layer 2s. VanEck also warned about potential risks ahead that could stifle bitcoin's expansion. Increasing energy demand by miners will require innovation, while revenue from processing transactions has to grow dramatically to replace diminishing mining rewards (which get cut in half every four years via halvings) to incentivize miners to sustain the network. Concerted efforts by governments around the world to restrict or outlaw bitcoin are also a threat. Further risks highlighted in the report include competition from other cryptocurrencies and large financial institutions exerting too much control. https://www.coindesk.com/markets/2024/07/25/vaneck-sees-bitcoin-hitting-29m-by-2050-but-a-lot-has-to-happen-first/

2024-07-25 17:53

The eight spot ether exchange-traded funds had a largely successful launch on Tuesday, despite the missing staking feature that many investors had hoped to profit from. Spot ether exchange-traded funds successfully debuted in the U.S. on Tuesday, but regulators didn't let the ETFs generate income for investors by staking their ETH. The absence represents a disadvantage over directly holding the cryptocurrency, but issuers are hopeful regulators will eventually allow staking. Eight newly approved spot ether (ETH) exchange-traded funds got off to a busy start following their debut this week, despite lacking a key feature of Ethereum's native token: staking income. While the Grayscale Ethereum Trust (ETHE), which has existed in non-ETF form for years but just converted into an ETF, has seen about $811 million of outflows, new products from the likes of BlackRock saw almost $800 million deposited in the first two days. Issuers say they're pleased. This early success wasn't a given, especially after several issuers announced that they would not stake ether for yield, which they had initially planned to do in earlier filings. This was likely due to the U.S. Securities and Exchange Commission telling them to remove the feature as staking could potentially violate federal securities laws as it constitutes unregistered securities offerings, as the SEC had previously argued in other cases. With a new administration taking office in January, things could change quickly and issuers remain hopeful that the feature could eventually become part of the products. That being said, it is not currently "an active discussion," Rob Mitchnick, head of digital assets for BlackRock, said in an interview with CoinDesk. He added that the SEC made its view on that clear. BlackRock, the world's largest asset manager, did not initially apply to be able to stake in their application but others, including Fidelity and Franklin Templeton, did. "I certainly would hope that as an industry, we're going to be able to help to educate and provide perspective on how it is that we can bring staking capabilities to investors in these products," said Cynthia Lo Bessette, head of digital asset management at Fidelity. "Staking is a critical component of the Ethereum ecosystem as it is the activity that secures the ecosystem and so, therefore, it's an important part of the investment experience and being able to invest in your ether." Former President Donald Trump seems to have won over the hearts of many leaders in the crypto industry and is their favored choice in this year's election given his recent endorsement of the space. "I believe staking within spot ether ETFs is a matter of when, not if," said Nate Geraci, president of the ETF Store. "That said, there is no question that politics are intertwined with the timing of the 'when.'" He added: "Indications are that a Trump administration would be much more crypto-friendly, which could certainly accelerate the timeline of when staking might be allowed. Otherwise, ETF issuers could be left waiting on a comprehensive crypto regulatory framework to be put in place, which would likely take significantly longer." For Franklin Templeton, who, like Fidelity, was keen on making staking a part of the ETFs, starting without that feature seemed natural and made the overall process of getting the product approved easier. "The easier path or path of least resistance was clearly to do it as an unstaked version," said Christopher Jensen, director of digital asset research for Franklin Templeton's Digital Asset Investment Strategies Group. "It just works better, it's simpler, it's easier, and the execution risk was lower, so I think it's very natural that that's where we started." If staking will be part of the ETFs in the future, it doesn't seem to be up to the asset managers, but is a question of whether the regulatory landscape in the future will be open to it. "I think it's very tied into the regulatory clarity that we think will happen over time of whether that will or won't happen," said David Mann, head of ETF product & capital markets for Franklin. "This is the framework we're dealing with today and if it evolves, we'll be ready to evolve with it." https://www.coindesk.com/news-analysis/2024/07/25/staking-in-ether-etfs-is-a-question-of-when-not-if-and-issuers-remain-hopeful/

2024-07-25 16:03

The first iteration of the $GREED project tricked people into tweeting an embarrassing message. This time, their money is frozen – but earning money. Last year, a social experiment called $GREED aimed to teach crypto enthusiasts a lesson, tricking them into tweeting an embarrassing message. The project is back. This time, there's real money involved – a lot of it. "In Sh*tcoin Season, any pointless cryptocurrency with a Twitter account can enchant thousands of traders into playing memecoin musical chairs. Throwing money at the wall and reason out the window, they let greed get the best of them. Sometimes literally." That is how I started my May 2023 story about $GREED, a social experiment that duped crypto traders hoping to score a quick buck into embarrassing themselves on Twitter (now X). It was a lesson in good judgment disguised as a money-making opportunity. The story's moral did not stick. In less than a year, speculators' memecoin greed prompted them to once again trade their good judgment for too-good-to-be-true returns. Presale scammers pitching exclusive memecoins earlier this year stole $122 million from wannabe get-rich-quick degens, according to on-chain sleuth ZackXBT. It was a devolution of the zero-sum casino games that give crypto a shady reputation. Forget about exchange tokens that traders believe have value, or well-known memecoins that have graduated from pure joke to, well, billion-dollar jokes like DOGE or SHIB. These presale tokens were literal scams. But people were willing to suspend their disbelief to get in early. "This is so stupid, people are just going to get rugged," $GREED's creator, who goes by Voshy, said in an interview. "How do you teach these people a lesson?" He decided to recreate his social experiment with a twist. Last time, his nonexistent $GREED token made a mockery of its "victims" without costing them any capital: He duped them into giving him access to their Twitter accounts, letting him shame them by posting an embarrassing tweet about their succumbing to their own greed. This time, like last, $GREED would not cost its participants anything, nor would there be a token at all. Instead it would be the lure for a surprisingly lucrative staking freeze. $GREED's unwitting participants would lock their own SOL in a staking account, safe from presale predators. While their money was working for them, it would also work for $GREED: an education initiative that Voshy hopes will teach the entire space a lesson. The plan For part two of $GREED, Voshy started by tweeting vague promises of what seemed like an upcoming airdrop of a GREED token. It caught on. Just like in 2023, crypto traders started angling for a token they knew nothing about. Soon, Voshy upped the ante with a website with wallet-connection capabilities. People could now seemingly commit their SOL to GREED. But for what? The website didn't say it was conducting a presale. It made no promises about what it was for, or what people would get. Details didn't matter; in the first hour, 1,527 wallets pledged 6,220 SOL (currently worth about $1 million). That's where Voshy's experiment diverged from the scammy sh*tcoin presales. Instead of taking people's money in exchange for a token (or in exchange for nothing, as scammers do), Voshy's website had prompted them to stake their SOL tokens to a Solana validator. When they signed the transaction, they locked their tokens to this validator for six months, until mid-September. "Locking it for three days, nobody would care. We wanted the people to notice, we wanted the people to feel something, to remember it just like last $GREED," Voshy said. Last year's $GREED experiment taught its unwitting participants to be "very careful" about giving out access to their social media accounts lest they be embarrassed again, the prankster said. With this year's $GREED, "we wanted to achieve that people don't just send their assets out." Those who locked their money in $GREED aren't completely stranded. They can get their tokens out by creating a governance proposal and then convincing 15 other $GREED participants to vote for their assets' release. A couple hundred of the GREEDy have attempted to lobby their way back to liquidity, with mixed success. "Vote for me if you also hate presale meta and will never send to anyone again," wrote one participant who failed to get their SOL unlocked through a vote last month. Unlikely moneymaker One of the benefits of duping people to stake their SOL during presale scam season is, well, protecting their SOL from presale thieves. But another lucrative benefit: staking yield. Staked SOL earns more SOL. For those who don't get their money out in votes, they'll have the option to withdraw come Solana's Breakpoint conference in September. At that point, the lock freeze will thaw and with it a pile of extra tokens from $GREED's partner protocols: Samoyed memecoin, the Marms NFT collection, Texture, Famous Fox Federation, Racket and Cyberfrogs. They all pitched in an assortment of tokens and NFTs that will go to those who leave their money in $GREED to the end. "Everybody who put their SOL in there is going to get more" than they had if GREED was actually a token, Voshy said. He mused: A good chunk would have likely lost their SOL tokens to some other scam if their money wasn't stuck. Instead of losing it, they're earning more through staking at an annualized rate near 8%. Most validators take a commission on the earnings generated by its staked assets, but the $GREED validator, run by Triton, doesn't, Voshy said. All of its staking yield goes to the frozen stakers, the ones who locked their SOL up for months. $GREED academy Voshy's $GREED experiment is attempting to teach the whole space a lesson. Though the validator at the heart of it doesn't take a commission, it does collect tens of thousands of dollars in SOL every month from transaction tips. All that money will go toward education initiatives, according to Voshy. "Mostly we want to empower people in the ecosystem to educate others," Voshy said. He spat out a few ideas: dapps that incentivize learning about crypto, TikToks and YouTube videos, that kind of thing. "It's going to be fully crypto education and quite Solana-focused," he said. Altruism turned $GREED's validator into an unlikely success story. Though a couple thousand SOL were staked before the lockup "gotcha" was widely known, a tsunami of SOL poured in after word got out. The $GREED validator currently has nearly 900,000 SOL tokens – a hoard worth roughly $150 million. More continues to pour in ahead of an end-of-July deadline, he said. https://www.coindesk.com/business/2024/07/25/greed-20-a-new-lesson-in-crypto-avarice-that-might-also-enrich-the-people-it-dupes/

2024-07-25 15:21

The yield offered by restaking is dwarfed by the likes of yield-generating platform Ethena. Total value locked on EigenLayer has dropped by 13% to $15.1 billion in the past 30 days, even though ether is trading at a similar level to June. Outflows can be attributed to the fickle nature of points farming and the limited returns on restaking protocols. Ether.fi has bucked the trend, experiencing growth in the period. Billions of dollars worth of ether (ETH) has been withdrawn from restaking protocols over the past month as the once trendy sector gets its first taste of the fickle nature of crypto investors. On June 25, ether (ETH) was trading at $3,300, a shade higher than Thursday's price of $3,200. During that period, however, the total value locked (TVL) on EigenLayer – a protocol that links restaking protocols – slumped by $2.28 billion to $15.1 billion. Restaking protocols like Renzo and Kelp have lost 45% and 22% of their TVL, respectively, data from DefiLlama shows. A portion of the outflows can be attributed to depositors looking to harvest points that will eventually be converted to airdrops subsequently moving on to another project to maximize returns. For others, the yield is too low when compared with specific yield-generation protocols like Ethena. Renzo offers an annual yield of 3.43%; Ethena offers more than 10%. Restaking is a strategy that investors use to secure an additional yield on ETH that is already staked on the main Ethereum blockchain. Protocols like Ethena generate a yield by harvesting funding rates, which can be more volatile. One restaking project that has managed to buck the trend is ether.fi, which has seen a $100 million increase in TVL. https://www.coindesk.com/business/2024/07/25/eigenlayer-outflows-of-23b-signal-restaking-sector-slide/

2024-07-25 12:57

The miner holds over 20,000 bitcoin and plans to buy more in the open market. Marathon Digital (MARA), one of the largest bitcoin (BTC) miners, bought $100 million worth of BTC in the open market and said it will readopt its strategy to hold all mined bitcoin on its balance sheet. The miner said in a statement on Thursday that it now holds over 20,000 bitcoin, worth nearly $1.3 billion based on current prices, on its balance sheet and plans to buy more in the open market. "Bitcoin’s recent price decline, coupled with the strength of our balance sheet, afforded us an opportunity to add to our holdings. We look forward to continuing to leverage our technological expertise to support Bitcoin and distributed digital asset ecosystems,” said Marathon's CFO Salman Khan. The decision to HODL or holding onto bitcoin comes almost year after Marathon started to sell its mined digital assets to pay for the company's operating expenses. Prior to the crypto winter, most miners adopted the strategy to hold on to all the mined bitcoin in their balance sheet, which paid off during the bull market rally. However, as market imploded last year, most miners started to sell their mined bitcoin to pay for operating expenses and Marathon was one of the last one to start monetizing their digital assets in early 2023. "Adopting a full HODL strategy reflects our confidence in the long-term value of bitcoin," said Fred Thiel, Marathon’s chairman and CEO. "We believe bitcoin is the world’s best treasury reserve asset and support the idea of sovereign wealth funds holding it. We encourage governments and corporations to all hold bitcoin as a reserve asset.” After the prolonged bear market, bitcoin started to recoup its losses this year after the likes of BlackRock got approval to offer spot BTC exchange traded-funds (ETFs) in the U.S. This move brought more investors into the market and helped the digital asset reach a new all-time-high price. Bitcoin has come off its peak of over $70,000 since then and now trading around $64,000 - still up 51% this year. “Given Bitcoin’s current tailwinds, including increased institutional support and an improving macro environment, we are once again implementing this strategy and focusing on growing the amount we hold on our balance sheet," Marathon's CFO said. Marathon held $268 million in cash in its balance sheet as of June 30 and will report its second quarter earnings Aug. 1. The shares of the miner is down about 2.5% in the pre-market trading, while bitcoin fell about the same amount in the last 24 hours. The broader CoinDesk20 Index also slumped 5.4% in the same time period. https://www.coindesk.com/business/2024/07/25/bitcoin-miner-marathon-buys-100m-btc-will-once-again-adopt-full-hodl-strategy/