Weekly News Roundup – 10 May 2021
Crypto moves fast and it can be hard to keep up with all the developments. To help you stay on top of what’s going on across the industry, we’ve created this overview of the key news from last week.
US banks to allow Bitcoin trading in 2021, says NYDIG execs
• According to a report by CNBC on Wednesday, New Digital Investment Group has inked a partnership with fintech staple Fidelity National Information Services, better known as FIS, to provide a framework for United States banks to offer crypto trading services to their customers.
• Patrick Sells, bank solutions chief at NYDIG, told CNBC that several banks have already signed up for the program, with the majority being smaller financial institutions. However, Sells also added that the company is in talks with major U.S. banks to participate in the program.
• According to the NYDIG executive, major names such as Bank of America and JPMorgan may be incentivized to come on board once smaller banks begin to reap the rewards of retail crypto trading adoption. BoA is among one of the staunchest anti-crypto banks in the U.S., regularly disputing the value proposition of Bitcoin (BTC) and cryptocurrencies.
• As part of the collaboration between NYDIG and FIS, participating banks will be able to offer direct crypto trading for their customers straight from their existing accounts.
Goldman Sachs to offer Bitcoin Derivatives to Wall Street
• Goldman Sachs, a global investment bank with over $2 trillion in AUM, will begin allowing large investors the chance to bet on the future price of Bitcoin.
• According to a report from Bloomberg, Goldman has begun using “non-deliverable forwards.” These are short-term futures contracts that pay cash to investors who can accurately predict the future price of Bitcoin. The two parties agree to a price; when the contract expires, the winning party earns the difference between the contracted price and the actual price.
• With the move, Goldman positions itself to make money off of one of Bitcoin’s seemingly negative aspects: volatility. The price of Bitcoin has whipsawed between a record high of $63,512 and $49,278 in the last month. It’s currently priced in the middle at just above $56,000.
• Though Goldman already added publicly traded Bitcoin futures this year, the NDF product allows it to reach larger investors, such as Wall Street firms.
• The investment bank, in coordination with digital asset trading firm Cumberland DRW, will buy and sell in BTC futures on CME’s options markets.
Revolut app announces Bitcoin withdrawals … Within limits
• Revolut has rolled out its Beta launch of Bitcoin withdrawals to U.K.-based Metal customers, who will be allowed to withdraw 500 to 1000 pounds a month in its initial stages.
• Europe’s leading financial app Revolut has finally enabled Bitcoin withdrawals four years after it first provided crypto trading services to some users, and a year after it extended trading to all 7 million users worldwide.
• Revolut first added Bitcoin, Litecoin, and Ethereum trading for premium users back in 2017, however they have only been able to withdraw it as fiat until now.
• This financial app also plans to roll out withdrawals worldwide — it has users in the U.S., Australia and elsewhere — and to other client tier-bases in the future.
• The move follows a similar pathway to Paypal which launched U.S. crypto trading in late 2020, with many noting at time that coins bought on the platform would not be able leave.
• To begin with, Revolut users will be able to add three external addresses and withdraw between 500 to 1,000 pounds a month, with Revolut also introducing two-factor authentication to ease security concerns.
Top DeFi protocols generated $252 million in revenue for token holders and users in April
• $252 million — that's how much revenue the decentralized finance (DeFi) ecosystem's top protocols generated during the month of April.
• Of that amount, DEX protocol Uniswap generated $113.66 million. The revenue generated by DeFi protocols covers what is earned by both token holders as well as users of the protocol, including liquidity providers.
• By comparison, protocols Compound, SushiSwap and Ave generated $46.08 million, $35.23 million, $24.72 million, respectively.
VanEck files for an Ethereum Exchange-Traded Fund
• Exchange-traded fund (ETF) startup VanEck has filed for an ether-based ETF, public records show.
• The company, which currently has a proposed bitcoin ETF under review by the Securities and Exchange Commission (SEC) proposed an ether ETF on Friday that would allow retail and institutional traders to gain exposure to the world’s second-largest cryptocurrency by market cap without requiring them to directly invest in it.
• VanEck intends to work with Cboe BZX Exchange on the offering. The same exchange is providing support for VanEck’s proposed bitcoin ETF. The SEC has postponed any decision on VanEck’s bitcoin ETF proposal to next month. In the past, the SEC has taken as much time as it legally can, about 240 days, to evaluate ETF proposals.
• The federal securities regulator has yet to approve an ETF in the U.S.
• If VanEck’s proposal is approved, this would be the U.S.’s first ether ETF, but not the first in North America. Canadian regulators have already approved several ether ETFs. WisdomTree, another company hoping to launch a bitcoin ETF in the U.S., has also listed an ether exchange-traded product in Germany and Switzerland.
Crypto bank SEBA adds support for DeFi tokens, including Uniswap
• Crypto bank SEBA announced Monday that it has added support for three decentralized finance (DeFi) tokens: Uniswap (UNI), Synthetix (SNX), and Yearn Finance (YFI).
• The development means SEBA's clients can now trade and custody these tokens with the bank. They will also be able to access these tokens across the bank's investment solutions, including customized and actively managed client portfolios.
• "Investor interest in digital assets is growing rapidly, and many want to go beyond bitcoin," said SEBA Bank's COO Alistair Heggie. The bank currently supports six crypto assets: bitcoin (BTC), ether (ETH), litecoin (LTC), Stellar lumen (XLM), bitcoin cash (BCH), and the USDC stablecoin for its crypto offerings.
• The addition of SNX, UNI, and YFI is based on SEBA Research's insights, said the bank, adding crypto assets are selected based on both quantitative and qualitative metrics. "The value accrual mechanism, tokenomics, and the underlying protocol play a central role in this process," said SEBA.
• Uniswap and Synthetix are two of the largest decentralized exchange protocols, while Yearn Finance is a leading yield farming aggregator, having over $3 billion worth of assets locked in the protocol, according to tracker DeFi Pulse.