Weekly News 10/20/2021: first Bitcoin ETF lands on Wall Street

Banks and Institutions

Impressive numbers for the first Bitcoin ETF

The ProShares Bitcoin Strategy ETF (BITO) made its debut on the New York Stock Exchange (NYSE) on Tuesday, which caught the attention of investors. In less than an hour, the ETF recorded more than $440 million in trades, a record for listed fund launches this year. The fund’s first day’s sales totaled more than $1 billion. This ETF will have Bitcoin futures as its underlying asset, which is different from holding Bitcoins "in cash". This would be called a "spot" ETF.

Parliament reluctant to regulate crypto-assets

The 2022 Finance Act amendments related to cryptoassets have been rejected. Carried by the deputy Pierre Person (LREM), their aim was to allow the investment of cryptoassets in real economy companies, to pay employees directly in cryptoassets, to simplify taxation, and to defund exchanges between companies. Parliament’s reasoning appears to suggest that it’s too early to regulate these topics.

Grayscale wants to convert its investment product into a Bitcoin ETF

Grayscale officially launches the conversion of its GBTC fund into an ETF. Despite the fact that the SEC has so far only accepted ETFs based on Bitcoin futures, Grayscale believes it is only a matter of time before a ETF spot can be accepted.

Crypto-asset deposits paid for by a Swiss bank

Swiss bank SEBA bank is now offering its institutional clients the opportunity to earn fees on their crypto asset deposits. In partnership with companies in the industry, these revenues are generated via investments in decentralized finance protocols.

A Bitcoin ETF in France

Paris-based investment firm Melanion Capital prepares to launch its bitcoin-related ETF product this Friday. Called "Melanion BTC Equities Universe UCITS ETF," the product will start trading on Euronext Paris. AMF, the French financial regulator, officially approved it last August. More European institutional investors will now have the opportunity to gain exposure to Bitcoin.

Tether and Bitfinex facing fines

The CFTC, a U.S. regulator, sued Tether and Bitfinex, fining both companies a total of $42.5 million. Among other things, the regulator called out Tether’s "inaccurate or misleading statements" regarding its stablecoin USDT. Statements that USDT was entirely backed by dollar reserves were singled out. But the case is theoretically closed and both companies can continue their activities after paying the fines.

The Banque de France continues its CBDC tests

The Bank of France is continuing its research into a central bank digital currency (CBDC), testing a blockchain-based CBDC operating on government bonds and the country’s debt market. More than 500 institutions participated in the experiment, which lasted 10 months. The project tested everyday missions, such as issuing new bonds, using them in repurchase agreements, as well as paying coupons and redeeming transactions.

Russia gets more accommodating with crypto-assets

Vlamidir Putin considers that crypto-currencies are developing and have the right to exist, especially for payments and investment. This statement contrasts with a rather hostile attitude of Russia until now towards this market.  He also said that eventually, cryptoactives could be used for energy markets, especially oil, but that it was still too early due to their high volatility.

Crypto ecosystem

Ethers leave the exchanges

Ethereum reserves on exchange platforms are down sharply. On the Coinbase platform, for example, more than 400,000 ETH have been withdrawn in the past 15 days. This drop in liquidity could fuel the massive price increase currently taking place on the market.

Technology

U.S. benefits from China’s mining crackdown

The United States is becoming the world leader in Bitcoin mining. Following China’s crackdown on the activity, the mining country’s share officially drops to zero. Other countries are taking advantage of the situation, first and foremost the United States. Many observers remain skeptical about these figures, however: there is probably still some underground mining activity in the country.

Figures

• The cryptoasset market reaches its highest point, at $2600 billion capitalization.
• The Binance platform achieves the largest token destruction in its history, with $640 million BNB destroyed.
• The total value invested in decentralized finance now exceeds $200 billion.
• More than half of crypto wallets played a blockchain-based game in Q3 2021.