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Stocks of Bitcoin: JPMorgan offers BTC exposure, an ETF in sheep’s clothing

JPMorgan bunched proxy crypto stocks to give skeptical investors exposure to the crypto economy.

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Cryptocurrency adoption has been penetrating the mainstream at an exponential rate. While most investors are going straight into buying the likes of Bitcoin (BTC) and Ether (ETH), a few skeptical investors want to invest in the cryptocurrency economy without exposure to tokens’ volatility directly. 

This volatility is evident in the recent all-time high Bitcoin of around $61,700 reached on March 14, before dropping to trading in the $56,000 range and then rising to around $59,000 at the time of publication. Bitcoin’s market capitalization has now surpassed that of Visa and Mastercard combined.

For the overly cautious investors, JPMorgan recently announced its Cryptocurrency Exposure Basket, or CEB, a debt instrument portfolio consisting of 11 stocks. These stocks are either companies that hold Bitcoin as a treasury asset or companies in industries complementary to the cryptocurrency industry.

However, the efficiency of such a basket of stocks when compared to Bitcoin remains to be seen. Ben Weiss, president and chief operating officer of CoinFlip — a company running Bitcoin ATMs — told Cointelegraph that this “strategy is viable,” adding: “JP Morgan’s cryptocurrency exposure makes sense for people who want to invest in blockchain and cryptocurrencies traditionally without the volatility of cryptocurrency.”

The CEB contains an unequally weighted basket of reference stocks. It allocates 20% to MicroStrategy and 18% to Square. Both of these organizations are led by prominent Bitcoin bulls, Michael Saylor and Jack Dorsey, respectively. More importantly, both companies own Bitcoin as a treasury asset on their balance sheet.

MicroStrategy is a publicly traded company that has the largest Bitcoin reserves of 91,326 BTC, valued at $5.25 billion, thus, accounting for 71% of the company’s market capitalization. In comparison, Square owns 8,027 BTC, valued at $461 million, accounting only for 0.4% of the company’s total market cap.

However, Joshua Greenwald, chief risk officer at Uphold — a cryptocurrency platform — told Cointelegraph why these stocks could have an adverse impact on investors: “This may prove a dangerous way to get exposure to BTC, as pressure on management for holding large BTC positions might create additional downside leverage on a selloff.”

CEB puts the auxiliary crypto ecosystem in the spotlight

Along with the companies directly holding Bitcoin, even firms that are related to the cryptocurrency industry in an auxiliary fashion were put in the spotlight as well due to their perceived high correlation with Bitcoin. In the CEB, Riot Blockchain and Nvidia Corporation are given allocations of 15% each. The four mentioned companies account for 68% of the debt instruments’ total allocation.

Riot Blockchain is a cryptocurrency mining company whose stock has been on an absolute tear since February, showing high correlations with Bitcoin. In addition to being related to Bitcoin due to its mining operation, Riot also owns 1,175 BTC on its balance sheet, valued at around $68 million, which accounts for 1.6% of its overall market capitalization on Nasdaq.

Nvidia Corporation is a graphic processing units manufacturer, which is now also used in mining proof-of-work cryptocurrencies like BTC and Ether. The rate at which PoW cryptocurrencies are mined is highly dependent on the power and functionalities of the GPUs being used.

The growth of companies such as Riot and Nvidia is directly linked to Bitcoin’s growth due to their participation in the cryptocurrency ecosystem. This applies to all the exchanges trading Bitcoin products, to energy companies that are getting into Bitcoin mining, and even to payment platforms like PayPal that support Bitcoin.

The other crypto auxiliary stocks that are a part of JPMorgan’s CEB are PayPal Holdings, Advanced Micro Devices, Taiwan Semiconductor Manufacturing Company Limited, Intercontinental Exchange, CME Group, Overstock.com and Silvergate Capital Corporation. All of these companies are related to crypto and Bitcoin in one way or another, right from being part of the mining and energy process to having Bitcoin products listed on their exchange, as is the case with CME and Bakkt, which is owned by ICE.

However, one stock missing from this basket is the Tesla stock. On Feb. 8, Elon Musk’s company bought BTC worth $1.5 billion at the time. This move alone pushed the price of Bitcoin by $3,000 within minutes, showing the impact Musk and Tesla have on the crypto markets. In fact, the CEO’s effect on the crypto market is now famously referred to as the “Musk Effect.” Considering all this, it would be obvious to include Tesla’s stock on the CEB. But JPMorgan’s reason for excluding Tesla’s stock could be that it feels that Tesla’s stock is “dramatically overvalued.”

Even Sam Bankman-Fried, CEO of FTX — a cryptocurrency derivatives exchange — mentioned to Cointelegraph how Tesla had an interesting correlation with BTC:

“TSLA is probably the most interesting: Both are speculative assets; they have overlapping investor bases; Tesla owns some BTC; and both often move on Elon Musk’s tweets. MSTR is a more boring example.”

Crypto exposure through CEB is limited

Although JPMorgan’s CEB could be a “gateway drug” for traditional financial market investors to get into cryptocurrency, the true exposure the basket would give investors to Bitcoin seems limited, according to Weiss:

“Most people are investing in the technology company side of a company like MicroStrategy and less of the Bitcoin side despite its large Bitcoin exposure. This is because when comparing holding the stock and holding Bitcoin directly, if you want to be exposed to Bitcoin, Bitcoin is still the best way to get exposed to it.”

In addition, the potential of high fees for working with legacy systems like those at JPMorgan could also be a concern. Greenwald opined on this: “Following good security hygiene and using a relatively simple-to-use custodial provider will likely prove more cost-effective than the annual fees of most managed solutions.”

Additionally, the CEB is not the only way for retail and institutional investors alike to get exposure to Bitcoin through traditionally regulated markets. Grayscale’s Bitcoin Trust has established itself as a forerunning choice for institutional investors to get exposure to Bitcoin. It is in fact the largest public holder of Bitcoin in the world. It currently owns 649,130 BTC, which is currently valued at around $37 billion.

Related: Bitcoin ETF may come to US, but not all crypto investors think it’s needed

On top of Grayscale, two Bitcoin exchange-traded funds have launched in the Canadian markets called Purpose ETF and Evolve ETF. Within a month of their launch, both ETFs combined to have close to a total of $1 billion as their BTC assets under management. Bankman-Fried opined further on the viability of the CEB, saying:

“You can try to do it and get some correlation — so, it’s not totally useless. But in the end, there will be significant investor demand for BTC, or at least for crypto companies. I’d guess they’re better off going internationally for listed crypto companies.”

Over and above these methods, there are other ways institutions could get exposure to Bitcoin. One major strategy apart from buying Bitcoin as a treasury asset could be to enable digital payments channels. Amazon and Facebook could be the most logical choices for this. Facebook could very well be the first major social marketplace to enable digital payments through its own stablecoin, Diem, formerly known as Libra. Diem is due to launch in 2021 and is touted to be a game-changer among crypto payments, stablecoins and even central bank digital currencies.

While it is a great sign that JPMorgan is trying to get in on cryptocurrencies, the debt instrument seems like a Bitcoin ETF in sheep’s clothing with limited upside to Bitcoin as compared to holding the asset itself. Due to this, it’s highly unlikely that seasoned investors will flock to it in the long run, especially when all the Bitcoin has been mined and scarcity begins.

Morgan Stanley, a competing investment bank, has taken another route to provide Bitcoin exposure to its clients. On March 17, it announced Bitcoin investing for its wealthy clients. The investment bank has an AUM of $4 trillion and will allow premium clients to invest in Bitcoin through Galaxy Digital’s Bitcoin Fund, Institutional Bitcoin Fund and FS NYDIG Select Fund. There will be an allocation cap for clients at 2.5% of their overall portfolio.

This move is indicative of the fact that now is not the time to seek alternative exposure to BTC, given that it’s still at an early stage of adoption. ETFs and such pseudo-ETFs could be a solution in countries where investors are limited by restrictive regulations. Otherwise, there seems to be no real alternative to actually buying and hodling Bitcoin.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cointelegraph.com/news/stocks-of-bitcoin-jpmorgan-offers-btc-exposure-an-etf-in-sheep-s-clothing

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Here’s how Viberate plans to tokenize live performances

You might remember Viberate as the music tech startup with an incredibly successful 2017 ICO when they sold out their VIB tokens (available on Binance, Bittrex, OKEx, and Uniswap) in under five minute

The post Here’s how Viberate plans to tokenize live performances appeared first on AMBCrypto.

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You might remember Viberate as the music tech startup with an incredibly successful 2017 ICO when they sold out their VIB tokens (available on Binance, Bittrex, OKEx, and Uniswap) in under five minutes. Today, they’ve grown into full blockchain-based music research and analytics platform and have just announced another ambitious project: launching the first-ever live performance NFT.

With World’s first “live gig NFT”, Viberate will explore new ways for music artists to trade their work.

Teaming up with the Blockparty marketplace, Viberate plans to drop special NFTs featuring exclusive content by one of the company’s co-founders, world-renowned Techno DJ, and producer UMEK. Besides three original remixes of his track “Lanicor”, bidding will also be open on his live performance.

If the concept proves to be successful and gains traction in the industry, Viberate plans on providing the option of gig token minting to nearly half a million music artists in its database, along with minting artist ID NFTs through a secure verification process. These ID NFTs will then act as a certificate of authenticity, reassuring the buyer that the contents indeed come from a verified artist.

Matej Gregorcic, Viberate co-founder and CEO, explains their plan: “What we’re testing out is quite straightforward. Any artist in the Viberate database will have the chance to offer the right to their live performance in the form of an NFT. People, be it organizers or fans, then bid on that token. The highest bidder will be able to decide between cashing in the token, meaning that the artist will play at their event, or reselling the token.

The collected funds are held in escrow until the day of the show. Once the event starts and the artist goes on stage, the token holder burns the token. This way, with the help of blockchain, both parties are secured and payments can be handled safely and transparently. We believe that the opportunity to handle bookings through NFTs comes at a great time, as the live music industry was hit extremely hard during the pandemic, so all the artists out there are looking for new ways to make sure there’s a gig waiting for them once live events return.”

To mint their own gig NFT or create a verified ID NFT, a music artist will first need to create and claim their profile on Viberate. For each NFT minted, they will need to lock VIB tokens into a smart contract and set the terms of the performance together with the initial price. Once the NFT is sold, the VIBs will be burned. Should an artist burn their NFT themselves, their VIBs will be returned to them.

Viberate and UMEK’s NFT drop will launch on Blockparty on Thursday, April 29, 2021, at 8:00 pm GMT+1 (3:00 pm EST).

Disclaimer: This is a paid post and should not be treated as news/advice.


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Source: https://ambcrypto.com/heres-how-viberate-plans-to-tokenize-live-performances

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CLS Group Posts Uptick in March FX Volumes as Markets Remain Active

FX swap demand last month even crossed the record achieved by the company in March 2020.

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CLS Group, a major foreign exchange settlement provider, reported positive growth in trading activities in March across all offered forex instruments. The company posted an average daily traded volume of $1.977 trillion for the month, which is 1.8 percent higher than February’s numbers.

The increase in the demand can be seen across forward, swap, and spot FX markets, where the company is operating. The demand for FX swaps leaped the highest last month with around a 3 percent jump to $1.377 trillion from February’s $1.353 trillion. It was even higher than what the company recorded in March 2020 when the entire financial market saw extreme volatility due to the Coronavirus breakout.

Looking Forward to Meeting You at iFX EXPO Dubai May 2021 – Making It Happen!

The forward and spot FX market also jumped higher by 2 percent each to $0.117 trillion and $0.483, respectively. However, the overall monthly figures remained lower than what the FX settlement provider reported a year ago.

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Following the Industry Trend

“In the first quarter of 2021, we witnessed record average daily traded volumes of USD1.95 trillion, demonstrating a consistent increase of FX market activity year-on-year,” said Keith Tippell, CLS’s global head of product. “This was despite a 10% decrease in overall volumes in the month of March 2021 compared to the record highs in March 2020, driven by the extreme market volatility relating to the COVID-19 pandemic.”

Tippell further elaborated that a significant portion of the FX demand was generated by two currency pairs, USD/JPY and USD/HKD, as both recorded a monthly uptick of 15 percent and 38 percent, respectively.

Meanwhile, the company is expanding its industry footprint with more and more partnerships. In the past few months, Capitolis and BGC Group tapped CLS to enhance their FX services.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://www.financemagnates.com/institutional-forex/execution/cls-group-posts-uptick-in-march-fx-volumes-as-markets-remain-active/

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Blockchain

CLS Group Posts Uptick in March FX Volumes as Markets Remain Active

FX swap demand last month even crossed the record achieved by the company in March 2020.

Avatar

Published

on

CLS Group, a major foreign exchange settlement provider, reported positive growth in trading activities in March across all offered forex instruments. The company posted an average daily traded volume of $1.977 trillion for the month, which is 1.8 percent higher than February’s numbers.

The increase in the demand can be seen across forward, swap, and spot FX markets, where the company is operating. The demand for FX swaps leaped the highest last month with around a 3 percent jump to $1.377 trillion from February’s $1.353 trillion. It was even higher than what the company recorded in March 2020 when the entire financial market saw extreme volatility due to the Coronavirus breakout.

Looking Forward to Meeting You at iFX EXPO Dubai May 2021 – Making It Happen!

The forward and spot FX market also jumped higher by 2 percent each to $0.117 trillion and $0.483, respectively. However, the overall monthly figures remained lower than what the FX settlement provider reported a year ago.

Suggested articles

FBS Broker Updates its Trading Platform for Excellent PerformanceGo to article >>

Following the Industry Trend

“In the first quarter of 2021, we witnessed record average daily traded volumes of USD1.95 trillion, demonstrating a consistent increase of FX market activity year-on-year,” said Keith Tippell, CLS’s global head of product. “This was despite a 10% decrease in overall volumes in the month of March 2021 compared to the record highs in March 2020, driven by the extreme market volatility relating to the COVID-19 pandemic.”

Tippell further elaborated that a significant portion of the FX demand was generated by two currency pairs, USD/JPY and USD/HKD, as both recorded a monthly uptick of 15 percent and 38 percent, respectively.

Meanwhile, the company is expanding its industry footprint with more and more partnerships. In the past few months, Capitolis and BGC Group tapped CLS to enhance their FX services.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://www.financemagnates.com/institutional-forex/execution/cls-group-posts-uptick-in-march-fx-volumes-as-markets-remain-active/

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Chinese Police Confiscated $3.8 Million in Crypto After Arresting EOS Gambling dApp Team

$3.8 million in bitcoin and EOS seized in China from a team of developers operating a decentralized gambling platform built on the EOS blockchain.

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Chinese police officers have confiscated nearly $4 million in various cryptocurrencies after a raid against several developers that operated a decentralized gambling app built on the EOS blockchain.

$3.8 Million in Crypto Seized

After receiving tips of suspected illegal activity involving the developers of the dApp called Biggame, the Jiangsu police department opened an investigation. Ultimately, this led to the arrest of 15 people.

During the raid, the authorities found and seized 1.3 million units of EOS and BTC. Converted in fiat currencies, this amount equals 26 million yuan or $3.8 million.

According to the report, this is the first criminal case the police solved in connection with illegal online gambling inside China.

The dApp’s structure allowed it to attract players to games such as Dice and Texas Hold’em. The customers placed their bets using EOS smart contracts.


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The Chinese officials reported that in the period between June 2018 and December 2020, the group behind the dApp allegedly gained profits from the operations with crypto assets worth 60 million yuan or about $10 million.

It’s not the first time Chinese police go after fraud related to blockchain-based applications and platforms. As reported last year, the authorities arrested 109 people connected with the cryptocurrency pyramid scheme PlusToken. The well-known Ponzi scheme has defrauded investors of more than $5.7 billion.

”Internet Cleansing Movement”

The biggest economy in Asia – China – appears to be one of the leading countries regarding cryptocurrency mining and distribution but has also had tons of experience with illicit activities coming within its borders.

The arrest in Jiangsu highlights the Chinese law enforcement’s goal to neutralize any illegal online activities – from gambling and telecommunication fraud to money laundering. The mission was referred to as ”Internet cleansing movement.”

Furthermore, the end of last year saw an increasing number of court rulings in this field. According to the officials, nearly 100 individuals have been convicted for laundering money via crypto deals that involved more than $30 million worth of the most widely utilized stablecoin – Tether (USDT).

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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptopotato.com/chinese-police-confiscated-3-8-million-in-crypto-after-arresting-eos-gambling-dapp-team/

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