Although relative non-action in crypto markets has continued, with prices stagnating en-masse, prominent institutions, such as Goldman Sachs and Tiger Global, still seem ready to pounce on what this nascent industry has to offer.
Goldman Sachs Onboards Exclusive Investors For Bitcoin Products
Per an insider scoop from The Block, Wall Street’s golden child, Goldman Sachs, recently began to onboard a “small number” of institutional clients to test the waters for Bitcoin (BTC) non-deliverable forward contracts. The vehicle, which is a futures-tied derivatives instrument, will reportedly be the first on Goldman’s rumored crypto-centric trading desk, which was first hinted at in May 2018.
Along with apparently offering the aforementioned BTC-related contracts, the multinational financial services firm is supposedly also looking into ways to provide custodial support for the crypto assets held by its clients, confirming previous reports on the matter.
Interestingly, however, the individual familiar with Goldman’s operations claimed that rumors pertaining to an Ether (ETH) futures-tied contract were inaccurate. As noted by The Block, the U.S. Commodity Futures Trading Commision (CFTC) has yet to unveil its support for Ether futures, supporting the insider claim that Goldman isn’t poised to launch a vehicle linked to the second-most popular crypto asset.
Regardless, taking this development into account, optimists have claimed that Goldman Sachs has a high likelihood of only furthering its involvement in this nascent market as time elapses, bolstering the maturation of this now-10-year-old market.
Funding Secured: Coinbase Concludes Series E Round
After weeks of rumors surrounding Coinbase’s supposedly swelling valuation, on Tuesday, the cryptocurrency upstart’s president, Asiff Hirji, finally divulged that the organization had concluded its Series E financing round.
This most recent round of funding sees the startup’s coffers add $300 million in investment capital at a valuation of $8 billion, confirming the aforementioned rumors. This equity round, which occurred amid a harsh bear market, was led by Tiger Global, with Y Combinator Continuity, Wellington Management, Andreessen Horowitz, and Polychain also throwing funds in Coinbase’s metaphorical crock pot.
With this boatload of funding, Hirji noted that Coinbase intends to accelerate its plans to expand globally, (quickly) add more digital assets, build more utility applications for this industry, and facilitate the arrival of institutions into crypto.
Wall Street’s BlackRock Hesitant To Back Bitcoin ETF, Waiting For “Legitimacy”
Speaking at the New York Times DealBook Conference, Larry Fink, CEO of BlackRock, claimed that his firm is hesitant to offer a Bitcoin-centric exchange-traded fund (ETF). Although he didn’t seem overtly against the long-term success of blockchain technologies, Fink claimed that BlackRock is unlikely to back a crypto-based ETF due to the current illegitimacy of this nascent industry.
The leading institutional investor then noted that “ultimately,” a cryptocurrency-backed ETF would “need to be backed by a government.” However, he pointed out that a government’s support of such a fund is a near-impossibility, as Fink whipped out the classic bag of tricks enlisted by Bitcoin’s critics, citing fears of tax evasion and the like.
Furthering his anti-Bitcoin narrative, the BlackRock bigwig added that the anonymity of Bitcoin could pose a problem, stating:
“I do see one day where we could have electronic trading for a currency that could be a store of wealth… But right now the world doesn’t need a store of wealth unless you need that store of wealth for things you should not be doing.”
Interestingly, in spite of his apparent feelings of distrust and hate aimed towards the Bitcoin Network, Fink, speaking on behalf of BlackRock, claimed that he is “a huge believer in blockchain [technologies].” Commenting on optimal uses for blockchain technologies, the executive added:
“The biggest use for blockchain will be in mortgages, mortgage applications, mortgage ownership, anything that’s labored with paper.”
Fink’s views on blockchain aside, the bottom line is that BlackRock isn’t ready to launch a Bitcoin ETF, despite the hearsay that the institution briefly spoke with Coinbase regarding the matter.
Grayscale Rakes In $330 Million Amid Crypto Bear Market
Although the valuation of cryptocurrencies has collapsed by upwards of 70%, some claim that there is a definite silver lining in the crypto cloud, with Grayscale Investments releasing a positive report highlighting the performance of its business. In its most recent quarterly update, Grayscale, a subsidiary of Barry Silbert’s Digital Currency Group, noted that its clients invested $81.1 million into crypto asset products throughout Q3.
This mouth-watering sum brings the startup’s year-to-date total to $330 million, with 59% of that capital ($195 million) reportedly being sourced from the wallets of institutional investors.
Out of the $330 million invested through Grayscale’s diverse roster of instruments, 73% of funds were put through the firm’s Bitcoin Investment Trust (GBTC), indicating that BTC remains “the king,” even after its decade-long history.
Commenting on the statistics, Grayscale’s Michael Sonnenschein told CNBC Fast Money’s panel that his clients are “using this price pullback” to either dollar-average-down or to enter into crypto positions, directly alluding to the growing sentiment that worldwide adoption is in crypto’s cards, so to speak.
Crypto Tidbits
- Coinbase Lists Basic Attention Token (BAT) On “Pro” Platform: Just weeks after launching support for 0x’s ZRX And Circle’s USDC, on Friday, San Francisco-based Coinbase divulged that it had plans to list Basic Attention Token (BAT), the digital asset of choice for the Brave Browser, on its “Pro” platform. Like Coinbase Pro’s prior listing events, the startup unveiled plans to launch BAT trading via a four-step process — transfer-only, post-only, limit-only, and full trading. For now, BAT is not supported on Coinbase Consumer or through the fintech company’s iOS or Android applications.
- Tether Opens Account With Caribbean Deltec Bank: Tether Limited, the shadowed organization behind USDT, recently revealed that it had opened a bank account with Deltec Bank & Trust Limited, a 72-year-old financial institution in the tropical nation of Bahamas. This development comes just weeks after speculation raged regarding the legitimacy of Tether’s U.S. dollar reserves, which led the crypto market to value USDT, a prominent stablecoin, at 10% under its $1.00 parity. Accompanying this news was a supposed document signed by Deltec, which confirmed that the monetary value of Tether’s portfolio exceeded the number of USDT in circulation, prompting the stablecoin to recover to just shy of $1.00.
- Japan-based Coincheck Resumes Operations After Hack: Months ago, when 2018’s bear market was young, Tokyo-based Coincheck, Japan’s foremost crypto platform, fell victim to a $530 million hack, catalyzing a closure of a majority of its exchange operations. However, after presumably consulting with local regulators and rebuilding its security structure, Monex Group-backed Coincheck has finally reopened its doors, facilitating new account signups, customer deposits, and the purchase option for specific digital assets.
- Google, Samsung, Venrock Throw $15M At Startup Behind CryptoKitties: Dapper Labs, the Canadian startup behind Ethereum’s CryptoKitties, has just secured a $15 million endowment from a number of prominent venture capital funds, including Google Ventures, Samsung NEXT, and Rockefeller-backed Venrock. Dapper, a spinoff of Vancouver-based Axiom Zen, will use the $15 million garnered to launch a Los Angeles subsidiary focused on releasing other decentralized applications (DApps).
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