Richest Crypto Billionaires | Pudgy Penguin Mania

The asset manager’s new short-term credit fund is hosted on the Ethereum blockchain.

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Mitchell Martin Senior Editor, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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CZ KEEPS TOP SPOT ON CRYPTO WEALTH LIST AS BINANCE RIDES THE RECOVERY

Changpeng Zhao remains by far the richest person in the cryptocurrency business for a third year, his wealth tripling to $33 billion in the past 12 months as the industry recovers from a swoon that the founder of the Binance exchange helped fuel. Zhao had been worth $65 billion early in 2022, before the crypto market’s retreat from the previous year’s valuation near $3 trillion became a rout.

The cumulative value of digital currencies is closing in on $2.7 trillion, up from a 2022 nadir of about $833 million. Zhao’s stake in Binance, which accounts for the bulk of his fortune, has appreciated accordingly, making him the 50th-wealthiest person in the world. He is also quite likely to be the richest person facing a prison term this month after pleading guilty to U.S. money-laundering charges in November. C.Z., as he is known, may spend 18 months in prison, and he has already paid a $50 million penalty and stepped down as CEO of the exchange he founded.

There are at least 17 crypto billionaires, according to Forbes’ annual tally, and two of the biggest gainers hold shares in publicly traded companies that have quadrupled in value as traditional finance makes inroads into the digital-assets realm. Brian Armstrong, the second-richest person on the list and CEO of the Coinbase crypto exchange is now worth $11.2 billion, up from $2.2 billion last year. Michael Saylor, No. 4 and founder of the business-software maker and virtual closed-end bitcoin fund MicroStrategy, is at $4.4 billion, up from $760 million, making him the biggest crypto billionaire gainer, in percentage terms, on the Forbes list.

Three members of the top 10 are executives at Tether, whose token of the same name dominates the stablecoin business. None of them was on last year’s list, but their stakes came to light in a Forbes article about the secretive company in July. CFO Giancarlo Devasini is third on this year’s crypto billionaires roster, with a net worth of $9.2 billion vs. $4 billion in July. At Nos. 5 and 6 are CEO Paolo Ardoino and predecessor Jean-Louis van der Velde, both of whom have estimated values of $3.9 billion vs $1.8 billion in July.

PUDGY PENGUINS NFTS WADDLE TO WALMART

Like a phoenix flock rising from the virtual ashes of the non-fungible token market, Pudgy Penguins have made the leap from the blockchain to the real world, becoming retail stars. They came into the world in July 2021, when art-related NFTs were still all the rage, standing out from edgy, pixelated competitors with vibrant colors and adorable faces that propelled the tokens to prices in the $10,000 range. Created by a quartet of Florida college students, the brand got caught up in the retreat of cryptocurrency prices combined with a lack of marketing savvy, bringing the price down to about $2,330 by Christmas Day.

Today, however, plastic figurines and plushy toys based on the NFT collection are hot items at Walmart stores as well as online retailers Amazon and eBay at prices ranging from $8 to $30. Prices for the NFTs doubled last year, and today the cheapest virtual penguin sells for $45,000. While previous premier collections like the Bored Apes languish, Pudgy Penguins are benefiting from the marketing smarts of serial entrepreneur Luca Schnetzler, known online as Luca Netz. He saw potential in the brand, and after buying his own Pudgy Penguin NFT, he immersed himself in the brand’s online community and paid $2.5 million in April 2022 to acquire copyrights and the initial creator addresses, where royalties accrued.

Netz decided huge royalties were not the way to go and instead started building the brand using cute animations with appeal to Gen Z. Then came a wave of real-world goods: hats, pins, plastic figures and the apparently irresistible plushies. The sales gave the NFTs a lift back in the virtual world, and the merchandise is based on some of the art, which results in royalty streams to owners of the specific tokens that are linked to the chosen works.

CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$67,819

6.6%

Ether (ETH)

$3,335.15

0.5%

Tether (USDT)

$1.00

0%

Binance Coin (BNB)

$583.10

6.6%

Solana (SOL)

$175.91

2.3%

Sources: Forbes Digital Assets, CoinGecko. Prices as of 3:30 p.m. on April 5, 2024.

RIPPLE’S STABLECOIN FORAY IS A RECIPE FOR SELF-CANNIBALIZATION

Ripple Labs, developer of the XRP Ledger blockchain and its namesake token, is moving into the stablecoin business amid new questions about its network’s utility. The yet-to-be-named stablecoin will be pegged 1:1 to the U.S. dollar, and backed by short-term U.S. Treasurys and other cash equivalents. The collateral will be audited by an undisclosed third-party accounting firm, Ripple says, and the company will publish monthly attestations, similar to those of other stablecoin issuers. It is expected to be ready later this year, subject to regulatory approval.

The 12-year-old San Francisco-based firm has engaged in multiple initiatives to promote XRP’s use in areas spanning payments, tokenization and NFTs, including partnerships with international banks and fintechs. The stablecoin foray, however, could directly undercut the need for it and Ripple’s flagship On-Demand Liquidity service, which was built to facilitate instant cross-border money transfers using XRP.

Stablecoins linked to the dollar may prove to be a tough market for Ripple. The sector is dominated by tether, worth $107 billion, according to CoinGecko, trailed by usd coin ($33 billion) and dai ($5 billion). There are 10 other competitors with market values in excess of $100 million, including a recent entrant from PayPal.

Read more.

BITWISE INVESTMENT CHIEF WANTS ETHER ETFS, BUT NOT JUST YET

Bitwise Asset Management, one of the providers of spot bitcoin exchange-traded funds that began operating in January, late last month filed for permission to offer a similar vehicle for ether in the United States. But Matt Hougan, the firm’s chief investment officer, is in no hurry to have it approved, figuring the market needs to fully acclimate itself to the spate of new bitcoin ETFs. He tells Steven Ehrlich of Forbes:

“We're very interested in ether spot ETFs. We intend to be a player in that space and a big player. I think the market's consensus that it will happen in May is possible, but unlikely. I feel very confident we'll get an ether ETF. It's hard to get financial advisors to think about Ethereum right now.”

“I think the ether ETFs will be more successful if they launch in 12 months than if they launch in May. I know that sounds goofy, but I think TradFi is still digesting bitcoin, and if you give TradFi time to get comfortable with bitcoin and crypto, they will be ready for the next thing. But if you shove it down their throat in May, I'm not sure they will be. Part of me hopes that it's December or something like that because I think that would be better for the market.”

Read the entire interview here.

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