Crypto’s Nerdy Lender Of Last Resort | First Short Bitcoin ETF

SAM BANKMAN-FRIED DOLES OUT CREDIT LINES

The nerdy billionaire CEO of cryptocurrency exchange FTX has stepped in to bail out beleaguered crypto firms. On Tuesday, crypto lender BlockFi announced it had signed a term sheet with FTX to secure a $250 million revolving line of credit after the company said it would lay off about 20% of its staff. Zac Prince, BlockFi cofounder and CEO, hinted the deal was more than just a round of debt, saying “the agreement unlocks future collaboration and innovation between BlockFi & FTX.”

This followed an announcement on Friday that reported that Alameda Research, a quant trading firm founded by Bankman-Fried, had offered crypto broker Voyager Digital roughly $500 million in financing. On Wednesday Voyager requested a loan repayment from troubled crypto hedge fund Three Arrows Capital (3AC), announcing that it “may issue a notice of default.”

BETTING AGAINST BITCOIN 

On Tuesday, Bethesda, Maryland-based investment product provider ProShares launched the first exchange-traded fund (ETF) in the U.S. allowing investors to bet against the price of bitcoin. The ProShares Short Bitcoin Strategy (ticker BITI) corresponds to the inverse of the daily performance of the S&P CME Bitcoin Futures Index. When the index falls, the value of the ETF rises—and vice versa.

The fund launch comes as a wide selloff in cryptocurrencies is showing few signs of relief. Bitcoin is trading flat on the week, at around $20,300 as of Thursday afternoon. Ether is posting modest gains of 2.5% over the past seven days, changing hands at $1,088.

Source: Forbes Digital Assets, powered by Nomics.  Prices as of 4:00 p.m. on June 26, 2022.

NINE-FIGURE VC ROUNDS, UNINTERRUPTED

Crypto saw at least three large venture capital raises announced this week:

• Magic Eden, the top Solana-based NFT marketplace by market share, announced the close of a $130 million Series B venture round, which brings the company’s valuation up to $1.6 billion


• FalconX, a digital assets and cryptocurrency trading platform that helps institutions manage their crypto strategies in one place, raised $150 million in Series D funding at an $8 billion valuation.


• Fintech and digital assets infrastructure provider Prime Trust raised $107 million in Series B funding at an undisclosed valuation.

NORTHERN TRUST FURTHER INTEGRATES CRYPTO

Chicago-based asset management giant Northern Trust has expanded its years-long work with blockchain by establishing a new group built from the ground up to make it easier for investors in traditional finance to get into crypto . Dubbed the Digital Assets and Financial Markets Group, the new team combines employees responsible for digital asset markets with those serving traditional securities markets. The firm hasn’t yet disclosed which assets they’ll support, but in the past, it’s provided support for bitcoin and ethereum investors.

Northern Trust is an early leader in the enterprise blockchain space. After building a private equity fund administration tool on Hyperledger Fabric in 2017, the 133-year-old company co-launched a crypto administration firm last year. But this latest project is the first time Northern Trust has built a team dedicated to helping traditional investors get direct exposure to digital assets.

BLOCKCHAIN 50 SPOTLIGHT

Industrial and Commercial Bank of China: The largest bank on the planet ($5.6 trillion in assets) has 40 blockchain applications, which last year handled a total of more than $48 billion worth of transactions for local governments and industries, including construction and transportation. Among its most innovative apps is Icago, which rewards users for making use of energy-efficient vehicles, whether trains, buses or electric cars. The bank’s blockchain connects wallets owned by ICBC customers to government transportation data. Carbon credits issued by the transit commission as non-fungible tokens can be redeemed for China’s new central-bank digital currency. In the future, securitized carbon emissions will be sold as bonds to companies looking to meet carbon reduction requirements. In Qingdao, a city known for its beer, the program removed 99,000 kilograms of carbon in 2021. This year, the program will expand to Shenzhen, Shanghai, Chengdu and seven other cities. 

ELSEWHERE

Despite Crypto Crash, NFT Enthusiasts Keep The Party Going [NBC News]

Quant Hedge Funds Profit From Cryptocurrency Turmoil  [Financial Times]

Binance US Eliminating Fees On Bitcoin Trades [Decrypt] 

Michael del Castillo
Senior Editor 
Forbes Digital Assets

Nina Bambysheva
Reporter
Forbes Money & Markets

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