DeFi industry draws in commercial banks? Siam bets with $110M fund

Thailand’s oldest bank sees blockchain and DeFi as the future of global finance and is seeking to invest in the emerging digital landscape.

While serious institutional interest in crypto is perhaps becoming more of an established trend than an emerging narrative, the focus of big-money players is usually on Bitcoin (BTC). However, assets like Ether (ETH) and decentralized finance (DeFi) are beginning to pique the attention of major investors.

For Siam Commercial Bank (SCB), DeFi is a major focus point of its current digital asset drive, as Thailand’s oldest bank prepares itself for the expected financial technological disruption of decentralized finance. While other banks are still undecided or only making temporary forays into interacting with digital assets, SCB says it is keen on committing funds to explore the blockchain and DeFi space.

SCB’s DeFi focus is also coming at a time when regulators in Thailand are targeting the decentralized finance space for more stringent regulations. Indeed, regulatory attention is increasingly coming the way of the niche market space with national and intergovernmental agencies looking to craft legal policies for the DeFi market.

DeFi initially held the promise of decentralization; the disintermediation of the established gatekeepers of global finance. However, with banks and financial institutions investing in decentralized technology, the narrative appears to be shifting towards a hybrid form of DeFi known as regulated DeFi, which combines the extant norms and efficiency of traditional finance, instant settlements and cost reduction benefits associated with decentralized protocols.

DeFi ambitions

Siam Commercial Bank’s $110 million blockchain war chest started as a $50 million seed fund initiated back in February by SCB 10X, the bank’s venture arm. As reported by Cointelegraph at the time, the fund further strengthened the bank’s forward-thinking approach to the emerging developments in digital finance.

In a conversation with Cointelegraph, Mukaya ‘Tai’ Panich, chief venture and investment officer at SCB 10X, said that DeFi was a sort of revelation for the bank during its assessment of the emerging digital finance landscape.

“We were doing work on the blockchain industry and started looking into DeFi. And we were amazed by it,” Panich told Cointelegraph. According to the SCB 10X executive, the bank was quick to spot the paradigm shift of potential DeFi technology and the possible disintermediation of the traditional financial institutions.

“DeFi projects can be completely automated,” he said, noting that human involvement would be restricted to smart contract code upgrades. Panich also touched on the revolutionary nature of smart contracts and how lines of code can enable direct transactions between entities like lenders and borrowers without the need for a central counterparty.

Given the possibility of DeFi upending the legacy finance status quo, Panich says banks would do well to prepare for the imminent disruption:

“The reason we want to invest in DeFi and be part of the DeFi protocol’s ecosystem is because we want to understand and capitalize on DeFi, given its potential to meaningfully impact the financial industry.”

At $110 million, the blockchain and DeFi fund is almost half of the SCB 10X’s $220 million venture capital fund. Commenting on the size of the allocation to digital assets, Panich said that it was a reflection of the bank’s commitment to the DeFi space, adding:

“SCB 10X has invested and developed multiple collaborative relationships with the blockchain community in Asia and across the world including Ripple, BlockFi, Sygnum, Alpha Finance Lab, Anchorage, Anchor Protocol (part of Terra chain), Axelar and Ape Board, among others.”

Related: Thai bank's venture arm invests in institutional crypto custodian Anchorage

Upending global finance

Back in April, John Whelan, head of Banco Santander's blockchain lab in Madrid, put forward an argument for regulated DeFi. According to Whelan, private layer-two settlement networks for asset classes running on top of public blockchains will likely emerge in the future.

According to Whelan, blockchain adoption for reducing transaction settlement throughput is a major focus point for legacy finance stakeholders. Whelan’s comments highlighted the emerging narrative that rather than disintermediation, financial institutions will find means to adopt DeFi tech to their own backend processes.

Panich also echoed similar sentiments, telling Cointelegraph: “I want to point out that I really see a future where traditional financial companies will work together with DeFi companies. My view is that in the future, there will be an integration of traditional finance with DeFi.”

According to the SCB 10X chief investment officer, banks and financial institutions have the necessary “customer-facing” experience to better offer innovative fintech services to consumers. “In the future, I can see a world where DeFi can power the back-end of traditional finance companies,” Panich added.

For Rachid Ajaja, CEO and co-founder of decentralized capital market outfit AllianceBlock, the promised upending of legacy finance by DeFi is something that will happen in the long term. However, Ajaja said the short-term trend will consist of more financial institutions leveraging aspects of decentralized finance.

The AllianceBlock CEO drew parallels with the digital transformation era that saw the emergence of fintech companies providing services via APIs that interface with the banking system. “With the bridging of DeFi and financial institutions, we will see exactly the same thing, and bit by bit, legacy systems will change,” Ajaja told Cointelegraph, adding:

“Long term, I am absolutely confident that DeFi will upend the global financial system completely because everything that is done in traditional finance can be replicated in DeFi with lower cost, less need for a middleman, new opportunities and increased new revenue streams. It’s only a matter of time.”

Craig Russo, director of innovation at the nonfungible token vault and marketplace protocol PolyientX, also provided further insight as to the possible future path for DeFi adoption in global finance. Russo told Cointelegraph that financial institutions will most likely adopt open-access protocols via initiatives like Compound Treasury while also utilizing DeFi technology within their internal systems.

“A big goal of the DeFi movement is to revamp the current economic system to better align incentive structures, which may ultimately come at odds with the interests of some institutions while opening the door to a new wave of fintech innovation,” Russo added.

Related: Thailand to target DeFi in latest regulatory clampdown

Dealing with regulatory pressure

As the SCB continues with its exploration of blockchain investment opportunities, authorities in Thailand are shining the regulatory spotlight on DeFi. Back in June, Thailand’s Securities and Exchange Commission (SEC) announced plans to consider a licensing regime for the decentralized finance protocols, especially projects that issue tokens.

Commenting on how the bank will handle the increased scrutiny of the DeFi space, Panich stated, “SCB 10X’s aim is to absolutely work within the regulations laid out by the government and regulators such as the Thai SEC and the Bank of Thailand.”

“Blockchain and DeFi are very young, emerging and fast-changing industries. As a TradFi player active in DeFi, it is incumbent upon us to work closely with the government and regulators to help put forward the DeFi industry’s perspective, finding optimal ways to move the industry rapidly forward.”

The Thai SEC’s plan to consider DeFi regulations is indicative of the current attention being paid to DeFi by regulators across the globe. Also in June, the World Economic Forum released a policy toolkit for fair and efficient DeFi regulations.

The emphasis on fair and efficient regulations is likely based on fears that blockchain startups may be at a disadvantage from a compliance standpoint if more stringent measures are applied to DeFi. Regulated entities like banks and financial institutions may find it easier to negotiate these policy constraints.

Indeed, AllianceBlock’s Ajaja made this same point to Cointelegraph, stating, “DeFi primitives are definitely at a disadvantage in this regard against their counterparts in mainstream finance.” As such, Ajaja stated that compliance gateways for protocols like Know Your Customer and Anti-Money Laundering are necessary for greater compatibility with mainstream finance and the move towards interfacing with real-world assets for DeFi primitives.

Canadian border town suspends Bitcoin mining over aesthetic concerns

City officials have imposed a three-month suspension on new Bitcoin mining operations to make roads and buildings more presentable.

Massena, a town along the New York border with Canada has placed a temporary suspension on new Bitcoin (BTC) mining operations in the area.

According to a report by the Associated Press on Friday, Massena Town city officials mandated the 90-day moratorium on new Bitcoin mining activities due to aesthetic concerns.

Steve O’Shaughnessy, a Massena Town supervisor said miners littered roads with trailers laden with computers and other hardware required to mine Bitcoin. The AP report quoted O’Shaughnessy’s statement to WWNY-TV, saying:

“We don’t want it littered with these trailers that are pumping out Bitcoin. We just want to make sure if they are going to come here, that it’s a nice presentable building.”

City officials will reportedly use the 90-day moratorium to ensure that roadsides in Massena Town are decluttered with trailers and shipping containers moved off-road.

Meanwhile, Massena Electric is reportedly looking to sign deals with three crypto firms. According to the AP News report, the power company also has its own moratorium on working with new crypto miners.

Related: Four North American Bitcoin miners that could benefit from the East-West shift

With small border towns in North America hemorrhaging factory jobs over the past decade, Bitcoin and crypto mining operations represent a return of some industrial activities to places like Massena.

Cheap electricity in these areas is often a major draw for Bitcoin miners and in return, these companies offer the promise of jobs and bootstrapping the local economy.

Indeed, with China’s massive crypto mining crackdown and the expected East-to-West hash rate migration, these smaller towns in North America might play host to more Bitcoin mining activity.

Meanwhile, the major North American Bitcoin mining operations continue to upscale their capacity amid the current hash rate drop in a bid to capture a larger portion of the market.

North American Bitcoin miners controlling a larger share of the global hash rate distribution may also contribute to putting the industry in better standing with regulators especially in the area of environmental conservation.

Karura launches decentralized exchange on Polkadot and Kusama

Karura Swap has opened trading for the Kusama/Karura — KSM/KAR — pair as the platform becomes one of the first DEXs to launch on Polkadot and Kusama.

Karura, the Polkadot implementation of the Acala protocol, has launched its decentralized exchange (DEX) platform, Karura Swap.

According to the announcement issued on Friday, the DEX platform is now live, with KSM/KAR being the first trading pair on the exchange.

Per details provided by the announcement, Karura Swap has gone live with an initial total value locked north of $3.4 million, with more than 1,000 unique liquidity providers (LP).

The team revealed that the DEX launch highlighted the benefits of its “Bootstrap feature” that provides a liquidity sandbox for trading pairs with the walled environment, reportedly preventing front-running and market manipulation during the initial launch of a trading pair.

“With Bootstrap, Karura aims to empower trustless trading at fair market rate to reflect the tenets of equitable and open finance for all,” the blog post added.

Indeed, the inaugural KSM/KAR pair passed through the bootstrap phase and has only gone live after satisfying the mandated liquidity goal. With the launch of the DEX, Karura Swap becomes the first decentralized exchange on Polkadot and Kusama and the first avenue for trustless trading of Kusama tokens on a DEX.

Other trading pairs that will be launched on Karura Swap can also make use of the Bootstrap feature. LPs can elect to supply one or both tokens in the pool during the process, while trading remains suspended until the set liquidity target is achieved.

Related: DeFi hub Karura emerges as first Kusama parachain slot auction winner

With Karura envisioned as a decentralized finance hub on Kusama, the team said other features such as kUSD stablecoin loans, staking and liquidity mining programs are in the works. These added protocols are part of the plans to build up the network within the 48-week network lease secured by winning a parachain auction slot.

As previously reported by Cointelegraph, Karura became the first Kusama parachain slot auction winner back on June 22, with over 501,000 KSM staked in the crowd-loan process. These slot auctions determine the parachains that will be added to the Kusama relay chain, which serves as a companion network for Polkadot.

3AC-backed DeFi protocol Tranchess launched to track Bitcoin performance

Tranchess is live on the Binance SmartChain with a Bitcoin tracking token and yield farming options for investors.

Three Arrows Capital CEO Su Zhu has announced the launch of decentralized finance (DeFi) protocol Tranchess.

Tweeting on Thursday, Zhu described Tranchess as a “Tokenized Asset Management and Derivatives Trading” protocol.

While the project aims to become a multi-chain and multi-asset DeFi protocol, with designs on becoming a decentralized autonomous organization, the first iteration of Tranchess focuses on Bitcoin (BTC).

Tranchess 1.0 offers access to a BTC price performance tracker on a correlated basis. Since the project’s initial launch is on the BSC, users will need to have BTCB — the BEP2 version of Bitcoin.

According to the project’s white paper, users swap BTCB in exchange for QUEEN — the main native token. Alternatively, investors can acquire QUEEN with USD Coin (USDC) on supported exchanges.

Ownership of the QUEEN token enables users to get involved in the protocol sub-fund or Tranche. Keeping with the chess theme, the sub-funds are dubbed BISHOP and ROOK. Investors need only split their QUEEN tokens into BISHOP and ROOK on a 50-50 basis.

Per Zhu’s tweet, farming on Tranchess allows single-asset staking in a bid to counter impermanent loss. “If you are holding BTC, create the Queen token. If you are holding USDC, create the Bishop token,” the 3AC chief added in the Twitter thread.

Apart from farming, there is also the option of entering a leveraged long position on Bitcoin via the ROOK token. However, as pointed out by Zhu, “There’s no forced liquidation nor funding cost spike.”

Related: Report: Impermanent loss on Uniswap and other AMMs is always permanent

Where swapping BTCB for QUEEN is dubbed the “creation” step, Tranchess users can also go in the other direction by exchanging their QUEEN tokens for BEP2 Bitcoin — the “redemption” step. Before doing this, the user would have merged the BISHOP and ROOK tokens back to a whole QUEEN “coin.”

Back in July, Tranchess secured $1.5 million in seed funding from notable backers like 3AC, Spartan Group, IMO Ventures, Longhash Ventures and Binance Labs.

US Bitcoin mining giant Core Scientific set for Nasdaq listing via $4.3B SPAC deal

The Bitcoin miner will merge with Power & Digital Infrastructure Acquisition Corp in the latest crypto SPAC deal.

Core Scientific, one of the largest Bitcoin (BTC) mining operations in North America is set for a public listing on Nasdaq.

According to CNBC on Wednesday, Core has inked a $4.3 billion merger with Power & Digital Infrastructure Acquisition Corp — a special purpose acquisition company (SPAC). Apart from the planned valuation, other listing details like trading ticker and the start of actual public trading are yet to be revealed as of the time of writing.

The SPAC merger and subsequent Nasdaq listing will see Core join the ranks of fellow publicly-traded Bitcoin mining companies in the United States like Riot Blockchain and Marathon Digital.

Core CEO Mike Levitt revealed in an interview that the company had mined over 3,000 BTC since the start of 2021 with the firm holding 1,683 Bitcoin, currently valued at $53 million as of the time of writing.

The company reportedly earned $60 million in revenue for 2020 and is projecting an eight-fold increase in 2021. Indeed, North American miners are banking on the crypto mining disruptions in China to increase their earnings in 2021.

Levitt also described the company’s mining infrastructure framework as “unparalleled,” stating that Core holds over 70 patents in blockchain-related patents.

Operating out of locations in the Midwest and Southern United States, Core’s possible $4.3 billion valuation will put the firm at double the market capitalization of other rivals like Marathon, and Riot Blockchain.

Related: Four North American Bitcoin miners that could benefit from the East-West shift

With Bitcoin mining stocks continuing to remain a useful way to gain indirect BTC exposure for some institutional investors, several miners are electing to go public. This trend has also contributed to an increase in crypto-related SPAC deals and direct listings.

Back in March, Bitfury’s U.S. Bitcoin miner subsidiary Cipher Mining announced a $2 billion SPAC merger with Nasdaq-listed Good Works Acquisition Corp. As previously reported by Cointelegraph, Aussie Bitcoin miner Iris Energy is also looking to raise $200 million ahead of a planned Nasdaq listing.

GPU price inflation dips slightly as Ether downtrend continues

With Ether sinking below $2,000, the price of graphics cards has seen a further decline from June to July.

Graphics processing units (GPUs) have become a little cheaper in July amid a continued downtrend in the price of Ether (ETH).

According to a review by TechSpot, GPU prices across popular graphics cards are slightly lower in July than they were in June.

The lower prices in July are a continuation of the steady decline in GPU prices since the onset of the current crypto market downturn.

Indeed, with ETH tanking from over $4,000 in May to below $2,000, mining profitability has also tapered significantly. According to data from BitInfoCharts, Ether mining profitability is down about 80% from its May 2021 highs.

With Ether mining difficulty also down almost 8%, it appears GPU mining interest is also at a slower lower ebb. Overall, these factors could trigger decreased demand for already scarce graphic card hardware, to the benefit of non-crypto mining GPU users like gamers.

Surging demand by altcoin miners drove up the price of GPU miners with manufacturers forced to include hardware blocks to their graphics cards to limit performance as a means of discouraging miners.

GPU makers like Nvidia have also launched crypto mining-only graphic cards in an attempt to lessen the price burden on the rest of the PC hardware ecosystem.

TechSpot figures show a 16% average decrease in GPU price inflation from the manufacturer’s suggested retail price (MSRP) in June. As of the third week of July, several GPUs are already down by between $200 and $500.

However, despite the decline, GPU prices are still much higher than their respective MSRPs leading to average price inflation of 92% according to TechSpot figures. Indeed, the listed price of the GeForce RTX 3060 Ti at $1,012 is about 153% of its MSRP of $400.

Related: Nvidia GPU prices in China fall amid crypto mining crackdown

With GPUs still selling at almost twice the MSRP, gamers and other non-crypto mining members of the PC hardware ecosystem might still find their prices out of reach especially for brand-new GPUs.

In fact, the same situation also exists in the used GPU market with the current price drops is not enough to cause a significant decline in price inflation.

However, as previously reported by Cointelegraph, Nvidia GPU prices are down across Chinese e-commerce websites likely due to the crackdown on crypto mining activities in the country.

ASX sounds crypto exchange custody warning, calls for better regulations

The Australia Securities Exchange says crypto investors in the country need to be mindful of the dangers of holding their cryptocurrencies on exchange platforms.

The Australia Securities Exchange (ASX) has weighed in on the issue of crypto custody amid the ongoing discussions within the country’s Senate Select Committee on Financial Regulatory Technology.

In a submission to the committee on July 16, ASX highlighted crypto custody on centralized exchanges as a significant risk factor for investors.

The ASX submission outlined the implications of crypto exchange custody arguing that investors do not have access to their private keys while their funds are domiciled in these platforms — another way of saying “not your keys, not your coins.”

According to the ASX, crypto funds left on exchange wallets are vulnerable to cybersecurity risks in the form of theft by hackers. Crypto exchange hacks used to be a regular occurrence in times past with over $53 billion worth of virtual currencies stolen from platforms between 2011 and 2020.

Related: Senator warns lack of regulations could harm Australian crypto innovation

However, improved security measures on exchanges have stemmed the tide of these thefts significantly but the odd exchange hack still happens every so often.

Apart from cybersecurity problems, the ASX submission to the Senate committee also stated that investors who chose crypto exchange custody run the risk of their funds being handled in an undisclosed or unauthorized manner.

While noting that cybersecurity risks are not unique to crypto exchanges alone, the ASX outlined measures such as regulation, appropriate asset capitalization, and insurance as quality assurance protocols imbibed by legacy asset custodians.

As part of its submission to the committee, the ASX called for disclosure requirements for crypto exchanges as well as independent assurance protocols to better safeguard assets on their platforms. The securities exchange also recommended the introduction of core standards for digital asset custody services.

Given the absence of clear-cut crypto regulations in Australia, the ASX advised that such measures be included in a broader cryptocurrency regulatory framework for the country.

Crypto is an ‘untested asset category,’ says UBS CEO Ralph Hamers

The UBS chief said the bank continues to urge caution when it comes to crypto exposure for its clients.

Ralph Hamers, CEO of Swiss bank UBS, has said he does not fear missing out on crypto. Speaking to Bloomberg on Tuesday, Hamers said, “Clients are looking at different alternatives, and they hear about crypto, and there is a bit of a fear of missing out as well. They read it in the papers, but they also see the volatility.”

Commenting on the bank’s approach to providing exposure to crypto for its wealth management clients, the UBS CEO stated:

“We don’t offer it actively […] We feel that crypto itself is still an untested asset category.”

Back in May, reports emerged of UBS planning to offer crypto investments to wealthy clients. At the time, the proposed product was limited to a small fraction of the portfolios held by the bank’s wealth management clientele due to the volatility of cryptocurrencies.

However, in June, the bank warned customers to avoid crypto investments, stating that the market will crash under pressure from regulators.

Meanwhile, the Swiss branch of Spanish banking giant BBVA already offers Bitcoin (BTC) trading and custody solutions for clients in the country. Several Swiss banks, such as the 170-year-old Bordier & Cie, also offer crypto trading services.

Related: ‘Investors stay clear’: UBS warns regulators could pop ‘bubble-like crypto markets’

Hamers doubled down on the UBS’ reticence regarding crypto, stating that he does not have FOMO about the bank missing out on a few wealthy clients looking to invest in crypto.

While the UBS CEO appears not to be sold on crypto, banks in the United States are increasingly abandoning their previous anti-cryptocurrency stance and offering digital asset investment products.

As previously reported by Cointelegraph, NYDIG has partnered with a host of internet banking providers to allow several U.S. banks to offer Bitcoin trading to their customers. In July, Bank of America reportedly created a crypto research team, dubbing cryptocurrency “one of the fastest-growing emerging technology ecosystem.”

Grayscale sets sights on institutional DeFi fund

Grayscale Investments is set to float a fund targeting blue-chip assets in the decentralized finance space.

Michael Sonnenshein, CEO of digital asset management giant Grayscale, has announced a new investment vehicle for the firm targeted at decentralized finance (DeFi) assets.

Sonnenshein announced Grayscale’s planned DeFi Fund and Index during an appearance on CNBC’s Squawk Box. Detailing the purpose of the new product, the Grayscale CEO said the fund would offer exposure to DeFi assets, such as Uniswap (UNI) and Aave, for its institutional clients.

According to the Grayscale chief, the decision to create a DeFi fund, the firm’s 15th crypto investment product, was due to the growing interest in popular crypto assets in the decentralized finance space.

With institutional interest in crypto showing signs of diversification away from only Bitcoin (BTC), both Ether (ETH) and DeFi assets are reportedly beginning to come up in the conversation. Back in April, Cointelegraph reported that DeFi money markets were increasingly becoming more appealing to institutional investors.

With more regulated entities entering the DeFi space comes increased talk of regulations for the niche crypto market sector. Some industry stakeholders even say greater regulatory clarity is required for the DeFi space to interact with real-world assets.

Commenting on other institutional investment possibilities for crypto, Sonnenshein stated that a Bitcoin exchange-traded fund (ETF) approval in the United States will eventually happen. As previously reported by Cointelegraph, the Grayscale CEO remarked that the market was a “couple of points of maturation” away from seeing an approved ETF.

Related: Grayscale ‘100% committed’ to turning GBTC into Bitcoin ETF — CEO

Indeed, Grayscale is reportedly working with BNY Mellon toward converting its Bitcoin Trust into a Bitcoin ETF. According to Sonnenshein, the crypto asset manager is 100% committed to turning its flagship GBTC product into a Bitcoin ETF.

The U.S. Securities and Exchange Commission has yet to approve any Bitcoin ETF in the country. Earlier in July, the SEC pushed back its decision on Wisdom Tree’s Bitcoin ETF application.

Seized PS4 consoles in Ukraine used for FIFA accounts, not crypto mining

The gaming hardware confiscated by the Ukrainian police was being used to create in-game currency and not for farming cryptocurrency.

Last week, Cointelegraph reported on the seizure of 3,800 PlayStation consoles allegedly being used to mine cryptocurrency. The confiscated gaming units were among a stash of hardware discovered by Ukrainian authorities during a raid on a farmhouse accused of tampering with electric meters to steal power from the local grid.

Based on the initial reports at the time, the PS4 consoles, graphics cards, processing units and other hardware found at the scene was being used for illegal crypto mining operations.

However, according to an investigation by Ukrainian business publication Delo, the seized PlayStation consoles were being used to generate cards and coins for FIFA Ultimate Team (FUT), a game mode in the popular FIFA football game title.

Players usually have to earn FUT coins and cards by winning football matches in the game, but the busted warehouse was allegedly generating black market variants of these in-game items. According to Delo, Ukraine’s Secret Service has yet to confirm or deny its findings, with the agency electing to keep details of the ongoing investigation under wraps.

Related: Ukrainian police seize 3,800 PS4 consoles used for illegal crypto mining

Cointelegraph’s initial report did cast doubts on the likelihood of the illegal operation being used for crypto mining stating:

“PlayStation 4 is not the ideal rig to mine cryptocurrency. Given its slightly outdated configuration compared to many mining rigs available today, even a 16-console PS4 setup would fail to generate meaningful returns with legal electricity usage.”

However, using gaming hardware to mine cryptocurrencies is not unheard of and has in fact been linked with graphics processing unit (GPU) shortages for non-crypto mining users. Increasing demand for GPUs from miners coupled with a global semiconductor shortage saw budget PC gamers unable to secure next-generation graphics cards for their hardware.

Four North American Bitcoin miners that could benefit from the East-West shift

With China seemingly out of the equation, North American Bitcoin miners are looking to exert hash rate dominance.

Even before China finally wielded the ban hammer on crypto mining, Bitcoin (BTC) miners in North America had been building up their capacity amid efforts to gain a larger share of the global hash rate distribution. From building bigger data centers to acquiring hardware inventories, these establishments have been making concert efforts to balance the hash-power dichotomy between the Eastern and Western hemispheres.

North American Bitcoin miners often have to contend with energy usage concerns as well and some have been keen to partner with oil and gas firms, becoming buyers of last resort for flared gas. Indeed, American oil drillers and Bitcoin mining firms continue to collaborate over natural gas utilization, proving once again that the potential for Bitcoin’s thermodynamic capacity is set to be a net positive for the environment, despite the criticisms put forward against proof-of-work (PoW) mining.

With North American-based entities seemingly on the cusp of establishing a greater presence in the global Bitcoin mining matrix, here is a look at four of the largest Bitcoin miners in the region.

Riot Blockchain

In 2020, China still controlled about 65% of the global Bitcoin hash rate, according to estimates from several data sources. However, Riot Blockchain was expanding its operations with a swathe of major hardware acquisitions from leading Bitcoin miner makers like Bitmain.

In August and December 2020 alone, Riot Blockchain spent millions of dollars to acquire thousands of Antminers from Bitmain. Indeed, as reported by Cointelegraph in April, Riot Blockchain’s hashing capacity increased by 460% in 2020.

Riot Blockchain’s expanded inventory drive has continued into 2021, with the company purchasing over 42,000 Antminers from Bitmain earlier in the year. The Nasdaq-listed company also announced a $650 million purchase of a major data center located in Texas.

By acquiring the Whinstone data center in Texas, Riot Blockchain is set to own the single largest Bitcoin mining facility in the United States. The American Bitcoin mining giant is even set to expand the original capacity of the site from 750 megawatts to over 1,000 MW.

With its upscaled capacity coinciding with sweeping crackdowns in China, it is unsurprising to see Riot Blockchain enjoying greater Bitcoin mining success, as evidenced by the figures quoted in its monthly production and operations update. In April, the company reported that it mined 187 Bitcoin (worth $11.2 million at the time) the previous month.

The March 2021 BTC production figure marked an 80% increase from its Bitcoin mining total for March 2020. In its latest report in June, the company stated it mined 243 BTC, a 406% increase from its June 2020 production figure.

The June report also put Riot Blockchain’s year-to-date Bitcoin mining total at 1,167 BTC (currently worth $36.5 million). As of June 2020, the company had only mined 508 BTC meaning that this year’s production figure represents a 130% year-on-year increase.

In total, Riot Blockchain says it holds over 2,200 BTC as of the end of June, with all of the Bitcoin coming from its mining operations. Detailing the link between its recent production successes and the situation in China, the June report stated, “The exodus of Bitcoin mining from China has resulted in a downward difficulty adjustment and lower global network hash rate. As such, Riot is currently mining more Bitcoin per day than at any time in the Company’s history,” continuing:

“While it is broadly expected that many Chinese miners will eventually relocate, the company estimates that it could be quite some time before the global Bitcoin mining hash rate returns to its previous high of 180 exahash per second (“EH/s”), last observed earlier this year.”

Marathon

Marathon is arguably Riot Blockchain’s main competitor in the “North American hash wars” and, like its rival, the crypto mining giant has been expanding its hardware inventory since 2020. In October, the Nevada-based Marathon Patent Group acquired 10,000 Antminer S-19 Pros from Bitmain.

Such was the size of the order that it was estimated to boost the company’s operational hash rate capacity to 2.56 EH/s, a little more than the target 2.3 EH/s for Riot Blockchain’s expansion. With the Antminer order arriving in batches for Marathon, the company seems to now be focusing on achieving “carbon neutrality” and satisfying regulatory demands.

Back in March, the company first announced plans to divert all of its current hash power to a regulatory-compliant Bitcoin mining pool by the start of May. At the time, Marathon stated that the new pool adhered to U.S. Anti-Money Laundering (AML) protocols established by America’s Office of Foreign Control.

As reported by Cointelegraph in May, Marathon is planning a 300 MW carbon-neutral data center that will house 73,000 Bitcoin miners. According to the announcement at the time, the deployment of the facility will bring the company’s carbon neutrality to about 70% while taking its hash rate to 10.37 EH/s.

According to data from BTC.com, achieving a hash rate capacity of 10.37 EH/s would put Marathon number five on the current Bitcoin hash rate distribution log.

While more than 50% down from its 2021 high of $56.56, the company’s stock is still up 122.34% year-to-date as of the time of writing. With Bitcoin exchange-traded funds yet to gain approval in the United States, Bitcoin mining stocks are seen as the next best thing in terms of gaining indirect exposure to BTC.

Marathon itself is a Bitcoin holder separate from its mining interests. At the start of the year, the company bought over 4,800 BTC, valued at about $150 million at the time. New York Digital Investment Group reportedly facilitated the deal.

Hut 8

United States.-based firms are not the only major players in the North American Bitcoin mining theater, as Canadian outfit Hut 8 is also a significant name in the conversation. Once the largest publicly traded Bitcoin miner by capacity back in 2018, the Toronto-based company seems to be recovering from its previous setbacks.

In 2018, the crypto market suffered a crippling bear market as coin prices tumbled from peaks reached in December 2017 and January 2018. In May 2019, Hut 8 reported losses north of $136 million for the previous year, which also culminated in significant staff cuts.

Having waded through the crypto winter of 2018 and 2019, Hut 8 has undergone a massive upscaling of its miner hardware, announcing the purchase of over 11,000 MicroBT rigs valued at about $44 million. Based on the capacity of the MicroBT miners, Hut 8’s hash rate capacity is expected to reach 2.5 EH/s once all the machines are installed in the company’s 100 MW facility, currently under construction.

At 2.5 EH/s, Hut 8 predicts its daily Bitcoin production will jump two-fold from between 6.5 to 7.5 BTCto between 14 to 16 BTC. Such a per diem BTC mining rate may also serve to preserve Hut 8’s status as the Bitcoin miner holding the most self-mined BTC in the world.

Back in January, the Canadian Bitcoin miner estimated that its total Bitcoin holdings will reach 5,000 BTC by the start of 2022. The company also outlined plans to expand its hash rate to six EH/s by mid-2022.

Related: North American crypto miners prepare to challenge China’s dominance

Hive Blockchain

The East-West shift in Bitcoin hash rate will ultimately involve sweeping changes to the energy mix for BTC mining, with more of an emphasis on “Green Bitcoin.” For the Canadian crypto miner, green energy is a major focus point for its operations.

From Canada to Iceland, and even to Sweden, Hive Blockchain operated green-energy-powered data centers for crypto mining. Back in May, the company was reportedly forced to sell its facility in Norway, citing issues with regulators in the country.

Earlier in July, Hive acquired 3,000 MicroBT M30S miners for its facility in New Brunswick, Canada. The added hash power will reportedly be contributed to the Foundry USA Pool that already aggregates hashing potential from other major North American miners like Hut 8, Blockcap and Bitfarms, among others.

Hive’s additional 3,000 mining rigs will reportedly take the company’s hashing potential up by 0.264 EH/s to reach a total hash rate of 0.83 EH/s. The company also recently joined the ranks of publicly traded Bitcoin mining firms after securing a Nasdaq listing back in June.

Meanwhile, Gryphon Digital Mining, another U.S.-based miner, may soon be challenging the more established names in the North American BTC mining industry. The company, which claims to run on 100% renewable energy, recently purchased 7,200 Antminer S19J Pro mining rigs.

Based on the hashing capacity of the machines, Gryphon’s hash rate will approximately increase by about 0.72 EH/s. This new inventory will reportedly be installed in August and upon that time, the company will receive its ESG rating.

UK FCA will spend £11M to warn people about investing in crypto

U.K. financial regulators have announced an 11 million pound digital marketing war chest to warn people about the dangers of crypto investments.

The United Kingdom’s Financial Conduct Authority (FCA) created an 11 million pound ($15.2 million) digital marketing campaign to warn citizens about the risks associated with crypto investments.

Nikhil Rathi, chief executive of the FCA, made this known in a draft speech for the agency’s webinar titled “Our Role and Business Plan” delivered on Thursday.

Detailing the FCA’s decision to create the campaign fund, Rathi stated that the U.K. regulator is concerned about the increasing adoption of crypto investment among the younger demographic.

According to Rathi, “more people are seeing investment as entertainment” and that such irrational behavior may lead to significant losses on their part:

“This is a category of consumer that we are not used to engaging with: 18 to 30-year-olds more likely to be drawn in by social media. That’s why we are creating an £11m digital marketing campaign to warn them of the risks.”

According to Rathi, the risks involved in crypto investments are “stark,” with the FCA boss restating the agency’s popular refrain that people should be “prepared to lose all their money” if they invest in cryptocurrencies.

Related: UK advertising watchdog classifies crypto ads as ‘red alert’

The FCA’s digital marketing campaign is coming on the heels of actions taken by the U.K.’s Advertising Standards Authority against crypto ads that are deemed “misleading and socially irresponsible.

As previously reported by Cointelegraph, the U.K. ad watchdog agency ordered crypto exchange platform Luno to halt its “time to buy” Bitcoin (BTC) advert. Earlier in July, the advertising regulator announced a crackdown on cryptocurrency-related ads, which the body described as a “red alert” priority.

Apart from the crypto warning campaign, the FCA boss also stated that the agency will continue to focus on robust examinations of “financials and business models” for operators in complex markets like cryptocurrencies, especially in the area of Anti-Money Laundering (AML) compliance.

Bitcoin network node count sets new all-time high

Bitcoin’s node count has achieved another all-time high milestone with almost half of the nodes running on Tor.

The number of reachable Bitcoin network nodes has crossed the 13,000 mark for the first time. As previously reported by Cointelegraph, the previous all-time high was 11,613 achieved back in January.

According to data from Bitcoin network statistics dashboard Bitnodes.io, this milestone was reached back on July 5 when the number of reachable nodes clocked 13,374. As of the time of writing, Bitnodes’ data puts the current network node count at about 12,835,

Coin.Dance, another tracking website also has Bitcoin’s (BTC) node count at a new all-time high of 12,825. Nodes running the Bitcoin Core software make up 98.77% of the number with the remaining scattered across less popular implementations like Bitcore and Bitcoin Knots.

Source: Bitnodes.io

Bitcoin Core 0.21.1 was released back in May with a Taproot activation code and at almost 5,000 nodes (according to Coin.Dance), it is currently the most utilized version of the software among entities running reachable nodes. Figures from Bitnodes put the number at 5,125, or 40% of the total network node count.

Bitnodes’ data also shows at almost half of the network node count is running on Tor. Back in January, only about a quarter of all reachable nodes were running on the hidden network Tor. Running a client like Bitcoin Core using Tor provides an additional privacy layer since the IP addresses of connecting nodes are obfuscated.

Related: Tor-enabled Bitcoin nodes are back after bug on network

According to Bitnodes’ data, the network node count has increased by 2,739 nodes in the last year reinforcing Bitcoin's decentralization ethos.

The growth in the network node count is also akin to the expansion currently taking place in the Lightning Network ecosystem where capacity has gone up over 70% in less than six months.

Earlier in July, public Lightning Network capacity crossed 1,800 BTC after adding 100 BTC in less than a week. Data from Lightning Network statistics tracker Bitcoin Visuals puts the number of LN nodes at above 12,800 which is also an all-time high value.

Hedge funds see the crypto market decline as an investment opportunity

From rebalancing cash positions to announcing new investment products, hedge funds seem undeterred by the current crypto market decline.

Crypto market capitalization is down more than 40% since its $2.5-trillion high back in early May, but institutional investors continue to pile into the market. Despite Bitcoin (BTC) losing over half of its United States dollar value and altcoins tanking almost 70% on average, big-money players like hedge funds are still taking up digital currency investment positions.

From direct exposure to crypto to backing firms developing products and services in the digital asset space, institutional investors are building a more significant presence in the cryptocurrency and blockchain space. Back in June, a survey of 100 chief financial officers at hedge funds across the world indicated an expected increase in crypto exposure for hedge funds in the next five years.

As regulated entities continue to explore digital currency investment options, crypto regulations also seem to be taking shape in many jurisdictions. Meanwhile, in the U.S., regulators such as the Securities and Exchange Commission are coming under significant pressure to enact a stricter legal framework for cryptocurrencies.

Crypto investment appeal still strong

Earlier in July, Cointelegraph reported that London-based hedge fund giant Marshall Wace was set to create an investment portfolio focused on digital assets. According to the report, the $55-billion hedge fund was looking toward late-stage funding for digital finance companies and blockchain outfits working on use cases such as payment systems for digital currencies and stablecoins.

Amit Rajpal, CEO of Marshall Wace Asia Limited, outlined the company’s digital asset investment thesis, stating that the focus is on projects working toward redefining financial services, especially in the area of payments. According to Rajpal, digital finance is already changing the architecture of the underlying financial system.

Even before reports of its crypto-focused investment portfolio emerged, Marshall Wace had made some forays into the digital asset space. Back in May, the hedge fund participated in USD Coin (USDC) stablecoin issuer Circle’s $440-million fundraising round.

Marshall Wace is only the latest in a growing list of hedge funds and other institutional investors exploring crypto investment options. In April, United Kingdom-based asset management outfit Brevan Howard floated an $84-million crypto investment fund.

Speaking to Cointelegraph China earlier in July, Cornell University professor and Avalanche creator Emin Gün Sirer stated that the current market downturn had done little to dampen enthusiasm for crypto exposure among institutional investors. According to Sirer, the legitimacy of crypto as an asset class is “beyond question,” stating:

“I have been getting contacts from retirement funds, not hedge funds, but retirement funds. Very different piece, far more slower-moving but with maybe 10 times more dollars under their control and they are slowly coming into crypto.”

Joe DiPasquale, CEO of crypto hedge fund BitBull Capital, also echoed Sirer’s comments, telling Cointelegraph, “Institutional investors are still interested and continue to build positions at key support levels.”

“Naturally, the market hype has dampened, but these downturns have been historically opportune moments for long-term entries,” the BitBull Capital CEO added.

A spokesperson for Nickel Digital Asset Management, a $200-million crypto hedge fund, also provided some insight into the emerging strategies among institutional players amid the current range-bound trading for cryptocurrencies. In a conversation with Cointelegraph, the Nickel Digital representative said, “We are seeing active and continuous engagement from the entire institutional community, including (but not limited to) pensions, foundations, endowments and funds of hedge funds,” adding:

“Recent volatility has proved to be an opportunity for certain trading strategies (like market-neutral arbitrage) while being a headwind for others (beta exposures to underlying crypto assets). In fact, it created an immediate demand for lower-volatility defensive funds. The investment objective, sizing and risk tolerance are the critical factors in assessing any investment opportunity, especially in crypto.”

Indeed, Nickel Digital recently rebalanced its cash position as a result of the current market decline in a move the company described as an exercise in “financial discipline.” According to the fund’s CEO, Anatoly Crachilov, Nickel Digital is keeping its investment powder dry for the future return of parabolic price gains in the crypto market.

Big-money players welcome more crypto regulation

As more institutional players make crypto forays, stakeholders say asset managers are not worried about regulatory risks. Indeed, the bulk of attention from financial regulators appears to be focused on protection for retail investors.

Meanwhile, banks and other regulated entities seem to be getting clearer mandates from regulatory bodies to interact with digital assets. Commenting on the advantages created by enacting clear-cut regulations for cryptocurrencies, the Nickel Digital spokesperson told Cointelegraph:

“We embrace regulation because we feel that regulation brings clarity, and clarity brings broader market participation. Crypto has had years of regulation in the U.S., and the recent changes in Germany could unlock billions of dollars into the crypto space.”

Earlier in July, authorities in Germany passed a landmark ruling allowing institutional funds to allocate up to 20% of their assets under management to cryptocurrencies. This move came despite warnings by Germany’s Federal Financial Supervisory Authority about the dangers of speculative investments.

The new law in Germany could potentially see up to $415 billion worth of investments flowing into the crypto space. Germany’s Fund Allocation Act is also on top of previous rulings that put security tokens on equal footing as other regulated investment vehicles in the country.

Dismissing concerns regarding regulatory scrutiny having any negative impact on institutional crypto involvement, DiPasquale told Cointelegraph, “Regulatory fears are always present in the crypto space, but there is a drive towards compliance, which is likely to result in a more lenient attitude in the future.”

Bulls will return in the fall

If the current crypto downturn offers a premium investment opportunity for hedge funds and other institutional investors, such a strategy most likely relies on the expectation of a market bounce in the future. As previously reported by Cointelegraph, Sirer has predicted that sideways accumulation will dominate the crypto price action during the summer months.

Indeed, since dipping by over 50%, Bitcoin has been range-bound between the $32,000 and the $36,000 price marks. Bitcoin’s lack of a significant breakout either way has almost meant repeating mini-dips and pumps across the crypto market.

However, Sirer said he expects a return to the upward parabolic price trajectory in Q4. According to the Avalanche founder, the expected resurgence should begin in October or November.

“I am really excited about what’s to come because I know that there is so much interest in institutional, retail, as well as in this new technology that is poised to change the world. […] We are in the early days of a very big movement to restructure the entirety of the financial infrastructure.”

“Bear market is actually great for getting work done. The transformation of finance isn’t going to stop because we hit a relative price correction,” Sirer added to Cointelegraph China. The Cornell University professor also stated that serious stakeholders are utilizing the current period as a time for consolidation and growth.

Related: Avalanche founder Emin Gün Sirer ‘quite bullish’ on crypto market prospects

Like Sirer and Marshall Wace’s Rajpal, there is a growing belief that the crypto and blockchain space is on its way to upending the global financial system, hence the emerging interest from institutional entities. Even on the retail side, regulated institutions, such as banks, are also becoming keen on offering cryptocurrency-related services.

Having seen millions of dollars flowing into the coffers of exchanges like Coinbase on a daily basis, firms like NYDIG say U.S. banks are keen to get in on the action and begin offering Bitcoin trading services to account holders. As such, the company has recently announced a raft of partnerships that will allow crypto trading right from customer bank accounts in America.

BitBull’s DiPasquale also touched on the possibility of a bull market return in 2021 but offered a date closer to the winter period, adding, “We could see a return in 2021, yes, but parabolic gains may not be seen until December or early next year.” DiPasquale, however, predicted that Bitcoin will end the year trading above the $50,000 price mark.

Binance reportedly halts pounds sterling withdrawal for UK customers again

Binance has reportedly been forced to suspend fiat currency withdrawals for customers in the United Kingdom once again.

Binance customers in the United Kingdom are once again left without a fiat currency withdrawal option on Binance.

According to Financial News on Tuesday, the crypto exchange giant sent emails to affected customers informing them of the problem.

However, the exchange reportedly has not given any details as to the reason for the latest suspension of pounds sterling withdrawal but assured customers that it was working to resolve the situation.

Back in June, Binance had temporarily suspended cash payouts via Faster Payouts amid warnings from the U.K. Financial Conduct Authority about the exchange operating in the country without a license.

As previously reported by Cointelegraph, Binance reinstated the service at the start of July but Tuesday's notice once again puts the exchange's U.K. customers in limbo.

Binance did not immediately respond to Cointelegraph's request for comment.

Binance has lost important partnerships with payment technology firms in the U.K. like Clear Junction. Earlier in July, Barclays also announced its decision to cease support for card payments to the crypto exchange.

FTX crypto exchange integrates institutional trading tool ClearLoop

FTX has inked a deal with Copper that could enable access to crypto trading products for over 300 institutional asset managers via the ClearLoop settlement platform.

FTX has become the latest crypto exchange service to join ClearLoop — an instant trading settlement infrastructure from Brevan Howard-backed Copper.co.

As part of the integration, Copper’s over 300 institutional asset managers will be able to access FTX crypto offerings such as cryptocurrency futures, options, volatility markets, as well as tokenized stocks among others.

At over one million registered users and more than $600 billion in trading volume per month, FTX is the largest crypto exchange to join the ClearLoop platform, according to the Copper announcement on Tuesday.

With Deribit and Bitfinex also part of ClearLoop, Copper’s institutional clients can now move funds among the largest crypto options, spot and derivatives exchanges in the market.

According to Copper, ClearLoop offers secure crypto trading via an offline custody solution with asset managers able to trade fund balances on exchange platforms. Thus, Copper’s clients are able to hold on to their digital assets until a successful trade execution occurs, a feature the company says helps to minimize counterparty risk.

Back in July 2020, Copper integrated with Signet, the blockchain payment platform created by Signature Bank, enabling instant payment and settlement for its clients in U.S. dollars and other fiat currencies.

Related: Hedge fund manager Alan Howard invests in two crypto startups

FTX CEO Sam Bankman-Fried said that custody remains a major part of the conversation concerning institutional involvement in crypto. Indeed, the announcement quoted Bankman-Fried saying the collaboration with Copper will help FTX “stay ahead of the pack.”

As previously reported by Cointelegraph, Copper received $25 million in an extension funding round led by Brevan Howard, the asset management firm co-founded by billionaire hedge fund manager Alan Howard.

Institutional interest in the crypto space remains unabated even with the recent price struggle for cryptocurrencies. Indeed, several reports suggest that big-money players are pursuing significant exposure to virtual currencies in the expectation of another bull run before the end of 2021.

AML compliance mandatory for foreign crypto exchanges, says Korean regulator

South Korea’s strict crypto regulatory oversight is now extending to overseas exchanges that offer cryptocurrency trading services denominated in the country’s currency.

Eun Sung-soo, chairman of South Korea’s Financial Services Commission (FSC), has said that foreign crypto exchanges that deal in the Korean won must comply with the country’s Anti-Money Laundering standards.

According to The Korea Herald on Tuesday, Eun made these comments while fielding questions from lawmakers about the FSC’s plans to regulate crypto exchange giant Binance.

Eun reiterated the need for overseas exchanges that offer won-denominated crypto trading pairs to comply with the same Anti-Money Laundering standards as platforms based in the country.

As part of this compliance, these foreign exchanges will have to register with the Korea Financial Intelligence Unit — the FSC’s AML watchdog.

The FSC chairman’s remarks also offer another indication of South Korea’s efforts to maintain strict oversight on its local crypto market. Back in April, the government announced an interagency operation aimed at combating illegal cryptocurrency dealings including money laundering and tax evasion.

As previously reported by Cointelegraph, a recent investigation uncovered $1.48 billion in illegal overseas crypto transactions with over 30 people implicated in the case.

Eun’s directive for exchanges to register is part of the revised law announced back in March but is scheduled to take effect in September.

Related: South Korea’s small crypto exchanges face increasing regulatory heat

Apart from AML compliance, exchanges must also utilize real-name account trading. As such, platforms must forge banking relationships with financial institutions in the country.

Presently, only the “big four” — Korbit, Bithumb, Coinone, and Upbit — are in compliance with the real-name trading provision. Smaller crypto exchanges are reportedly finding it difficult to secure banking partnerships and risk being banned from operating once the six-month grace period elapses in late September.

Meanwhile, major South Korean banks are entering into the crypto custody business with Woori becoming the latest financial institution to announce a custodial product for cryptocurrencies.

Fidelity to hire more crypto hands amid growing institutional interest

Fidelity Digital is planning to hire 100 more people for its crypto business to service the growing needs of institutional investors.

Fidelity Digital, the crypto arm of the global asset management giant Fidelity Investments Inc., will reportedly hire more people for its expanding cryptocurrency business.

According to Bloomberg on Monday, the company is planning to increase its staff size by about 70% to handle the growing patronage from big-money crypto investors.

The increased workforce, numbering at least 100, will reportedly be deployed to locations in Salt Lake City, Boston, and Dublin.

As part of the staff headcount expansion Fidelity Digital president Tom Jessop said the company is looking to offer exposure to other crypto apart from Bitcoin (BTC), telling Bloomberg: “We’ve seen more interest in Ether, so we want to be ahead of that demand.”

Indeed, institutional interest in Ether (ETH) has been growing since the start of the year with investment inflows for ETH-based products even outpacing Bitcoin’s on some occasions.

Apart from diversifying into crypto investment and custody catalog, the recruits will also reportedly help the company extend its operating time in an attempt to offer full-time services “for most of the week.”

Unlike the legacy trading arena, the crypto market operates 24 hours a day, seven days a week. For Jessop, Fidelity Digital needs to upscale its operations to mirror this operating paradigm.

Related: Avalanche founder Emin Gün Sirer ‘quite bullish’ on crypto market prospects

Jessop also offered a unique perspective to view the evolution of institutional crypto interest beyond hedge funds and family offices. According to the Fidelity Digital chief, retirement advisors and companies are now looking for some form of exposure to crypto assets.

As previously reported by Cointelegraph, Avalanche blockchain founder and Cornell University professor Emin Gün Sirer revealed that retirement funds were looking to become the next big-money players in the crypto space.

Even the current crypto market downturn has done little to dampen enthusiasm among institutional investors. Earlier in July, $55 billion hedge fund Marshall Wace announced plans for late-stage investing in blockchain firms with a special focus on digital payment systems and stablecoin.

Immunefi partners with Binance Smart Chain on bug bounties to secure BSC projects

Binance is set to match bug bounties paid by Immunefi to white hat hackers that discover vulnerabilities in Binance Smart Chain projects.

Immunefi, a security service outfit that specialized in decentralized finance (DeFi) projects, has inked a collaboration with crypto exchange giant Binance.

According to a release issued on Friday, Immunefi will work in collaboration with Binance to improve the security of projects on the Binance chain. As part of the partnership, Binance will match bug bounty payments issued by Immunefi to white hat hackers who discover vulnerabilities in BSC-based protocols.

As a security outfit, Immunefi has reportedly paid more than $3 million in bug bounties to ethical hackers. Major BSC protocols such as PancakeSwap, DODO, and Zapper among others are already deploying the company’s bug bounty program to uncover vulnerabilities in their code.

For Mitchell Amador, CEO of Immunefi, DeFi requires proactive security measures are necessary to ensure that DeFi becomes the future of finance.

According to the company, incentivizing smart contract code auditing via bug bounties improves the security of the crypto space beyond the usual code verification and auditing protocols.

The news likely marks a significant investment by Binance towards improving quality assurance on the BSC. Back in May, the company brought in blockchain forensics firm CipherTrace to track high-risk fund transfers on the network.

Related: Growing pains? DeFi exploits plunder BSC, which calls for reinforcements

BSC’s emergence as a major DeFi hub at the start of the year also brought with it several security challenges as the hacks and exploits that were common in the Ethereum space also began happening on the Binance chain.

Back in April, Cointelegraph reported that flash loan attacks, as well as other DeFi hacks and exploits, had totaled $285 million since 2019. Since April, these incidents have only increased with PancakeBunny suffered a massive flash loan attack that saw its native token price plummet 90%.

‘Poopcoin’: Korean professor uses bio-waste to mine crypto

Students in a South Korean college are earning crypto mined from the energy generated from their excrement.

“Shitcoin” may no longer be solely a term used to describe altcoin projects with questionable value propositions, as one South Korean university professor has taken the term to a more literal dimension.

Cho Jae-weon of the National Institute of Science and Technology in Ulsan, South Korea, has created an eco-friendly toilet system that produces fertilizer and energy from human excrement.

Jae-weon, a professor of urban and environmental engineering, said the toilet system incorporates a vacuum pump that redirects human waste into an underground tank to produce biogas (methane).

The professor’s experiment is reportedly utilizing the biogas to power a university building, gas stoves and water heaters among other things.

“If we think outside of the box, feces has precious value to make energy and manure. I have put this value into ecological circulation,” the professor said.

Jae-weon’s experiment also has a digital currency component with a native token called Ggool, which is used to incentivize the adoption of the eco-friendly toilet. Students earn 10 Ggool per day if they use the toilet and use the digital money to buy coffee, bananas and even books on campus.

Related: Bitcoin Mining Council survey estimates a 56% sustainable power mix in Q2

Detailing the viability of human excrement as a power source, the professor stated that the excrement produced by an average person could produce up to 0.5 kilowatt-hour of electricity, which is sufficient to power an electric vehicle for up to three-quarters of a mile.

Crypto mining stakeholders are moving toward more eco-friendly power sources, especially amid the current backlash from policymakers over the supposed carbon footprint of the process. The Bitcoin Mining Council estimates that 56% of Bitcoin mining is currently using sustainable energy sources.

US-based Bitcoin miner Gryphon buys 7,200 rigs from Bitmain

Gryphon has doled out $48 million to buy Bitmain’s latest Bitcoin mining hardware set for release in the summer.

Gryphon Digital Mining has signed a purchase agreement with Bitcoin (BTC) mining equipment maker Bitmain to purchase 7,200 Antminer S19J Pro mining rigs.

According to a release issued on Thursday, the entire outlay for the mining inventory amounts to about $48 million. Starting in August 2021, Bitmain will deliver 600 mining rigs to Gryphon each month as part of the deal.

The Antminer S19J Pro is the latest iteration of Bitmain’s Bitcoin mining hardware slated for release into the market this summer. According to the release, each rig offers 100 terahashes per second (TH/s) hash rate capacity with an energy efficiency ratio of 29.5 joules per terahash (J/TH). With 7,200 of these machines in tow, Gryphon will theoretically see its hashing power increase by a factor of 720 petahash per second (PH/s)

Achieving a hashing capacity of 720 PH/s — or 0.72 EH/s — will put Gryphon in the top 15 Bitcoin miners by hash rate distribution according to data from BTC.com. Such a milestone could be an added achievement for the American Bitcoin miner as it sets out to achieve 100% renewable energy-based operations.

Related: Bitcoin miners can prove green potential by undergoing ESG ratings check

Back in June, Brittany Kaiser, chair of the company’s board of directors, told Cointelegraph that the company’s electricity source was 100% renewable. Kaiser also revealed that Gryphon will receive its ESG rating upon the launch of its mining hardware in August.

Crypto mining has come under increased scrutiny in recent months over energy consumption. Earlier in July, the Bitcoin Mining Council estimated that the global Bitcoin mining industry was running on a 56% renewable energy supply.

As previously reported by Cointelegraph, data from the Cambridge Bitcoin Electricity Consumption Index has shown that BTC’s electricity consumption is down almost 60% from the highs recorded in mid-May.

This decline is most likely due to Chinese miners going offline following a sweeping crackdown from the authorities in the country. Several establishments have been forced to relocate their hardware overseas.

Sen. Warren queries SEC chair on lack of crypto investor protection

The former presidential candidate has written to the SEC chairman for answers about plans for crypto consumer protection protocols in the United States.

Democratic Senator and former U.S. presidential aspirant Elizabeth Warren has once again raised alarms about the current regulatory climate for crypto in the country.

According to Reuters, Senator Warren has written to Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), demanding answers about the scope of the SEC's crypto oversight in the area of consumer protection.

In a statement issued by Senator Warren, the chair of the Subcommittee on Economic Policy bemoaned the lack of protection for crypto investors against the activities of rogue actors, adding:

"These regulatory gaps endanger consumers and investors and undermine the safety of our financial markets. The SEC must use its full authority to address these risks, and Congress must also step up to close these regulatory gaps."

According to Reuters, Senator Warren's letter to Gensler asked the SEC chairman to determine whether crypto exchanges are undermining the commission's goal of ensuring a fair investment market environment.

SEC chairman Gensler reportedly has until July 28 to respond to Senator Warren's query.

As previously reported by Cointelegraph, Senator Warren is a noted crypto critic who has described virtual currencies as "bogus private money."

Several administration officials including Janet Yellen, Secretary of the U.S. Treasury Department, are also outspoken critics of cryptocurrencies.

Korean investigation finds $1.48B in illegal overseas crypto transactions

More than 30 people are facing fines and prosecution in South Korea for allegedly contravening the country’s ban on overseas crypto transactions.

An interagency investigation into suspected crypto fraud and money laundering in South Korea has led to the discovery of 1.69 trillion won (about $1.48 billion) in illegal overseas cryptocurrency transactions.

According to The Korea Times, 33 people have been implicated by the Seoul Central Customs for contravening the country’s ban on overseas crypto trading.

Detailing the alleged crimes committed, Lee Dong-hyun of the Seoul Central Customs’ investigation unit revealed that the criminal acts fell into three categories.

The first group involved people who engaged in foreign crypto exchange trading which is banned in South Korea. These persons allegedly contracted third-party entities to transfer funds withdrawn for overseas cryptocurrency exchanges to the tune of over $700 million.

According to Dong-hyun, the second category involved people who used false remittance records to buy crypto from overseas exchanges. In one of the cases, an exchange operator in the country allegedly used $308 million in fake invoices to send funds to an overseas firm.

The funds were purportedly used to buy crypto tokens from overseas exchanges. Given the Kimchi premium in South Korea that often sees crypto prices significantly more expensive in the country, the exchange operator in question allegedly earned almost $9 million in capital gains.

In the third category, Dong-hyun revealed that some people used Korean credit cards to make cash withdrawals abroad for the purpose of buying crypto from overseas crypto exchanges.

“Virtual asset transfers under the guise of trade, travel or study expenses are strictly prohibited,” the Customs’ investigator stated, adding: “Violators will be subject to criminal prosecution or fines.”

Related: South Korea’s small crypto exchanges face increasing regulatory heat

Indeed, 15 out of the 33 have been fined with 14 others referred to state prosecutors. According to Dong-hyun, four people are still under investigation.

South Korean authorities have also been enacting tighter controls on crypto exchanges in the country. Platforms have been forced to delist several altcoin trading pairs deemed risky by both regulators and banking partners.

Meanwhile, a recent report has warned of soaring debt among South Korea’s young adult population given the increased investments in crypto, real estate, and stocks.

Robinhood’s cash cow under SEC scrutiny amid IPO filing

Robinhood’s main revenue source for the first quarter of 2021 could come under SEC review.

Trading platform Robinhood could lose a significant revenue source should the United States Securities and Exchange Commission move to ban the controversial payment for order flows (PFOF) — routing retail trading orders to market makers.

Brokers like Robinhood often use the practice to offset trading fees, thus providing zero commission trading to its retail customer base.

According to the Wall Street Journal on Wednesday, Robinhood’s initial public offering filing revealed that the broker earned 81% of its Q1 revenue from payment for order flows covering stock, options and crypto. As previously reported by Cointelegraph, Robinhood filed for its IPO on Thursday.

SEC Commissioner Gary Gensler has previously criticized the practice, and the GameStop saga from earlier in the year has also put the matter in the spotlight. Indeed, the company paid a $65million fine imposed by the SEC back in December amid allegations that Robinhood misled retail customers about the use of PFOF.

Meanwhile, Robinhood has stated that any SEC action against PFOF, including stringent regulations or an outright ban, could negatively impact its business. Payment for order flow is a banned practice in jurisdictions such as Canada and the United Kingdom.

The uncertainty over the SEC’s stance on PFOF under Gensler is the latest hurdle for Robinhood in its IPO journey. Back in June, the SEC’s inquiry into the company’s crypto trading business reportedly delayed its IPO filing.

Related: Facing $70M in fines from regulators, Robinhood files for IPO

Indeed, Robinhood’s crypto division has experienced significant growth in 2021 with its Q1 performance constituting a sixfold increase over the previous quarter. Back in April, the company announced a new chief operating officer to oversee its expanding cryptocurrency trading operations.

As previously reported by Cointelegraph, the U.S. Financial Industry Regulatory Authority fined Robinhood $70 million back in June. The FINRA fine was reportedly due to “widespread and significant harm” attributed to the company against thousands of its users.

Bank of Jamaica to begin digital currency pilot in August

The Bank of Jamaica is getting ready to begin testing its planned central bank digital currency in collaboration with financial institutions in the country.

Jamaica’s central bank will reportedly commence the initial roll-out of its central bank digital currency (CBDC) project in August.

According to a report by the Jamaica Observer on Wednesday, Bank of Jamaica (BOJ) Governor Richard Byles made this known during a Rotary Club event earlier in July.

Detailing plans to begin the pilot phase in August, Byles revealed that the BOJ was currently working on the technical aspects of the CBDC within a sandbox environment.

As previously reported by Cointelegraph, the BOJ chose Irish technology firm eCurrency Mint as the tech provider for its national digital currency project back in March. The Ireland-based cryptography security company was chosen from a list of solution providers that began applying for the project back in July 2020.

“As we work through the technical minting of the currency, we have to test it rigorously as a pilot that we’ll do in August,” Byles stated, adding:

“In September to December we’ll be recruiting more of the banks to come on board and then we’ll gradually expand the pilot out into a full-fledged launch of the CBDC.”

The BOJ governor also provided more details about the planned CBDC, stating that financial institutions will serve as intermediaries between the central bank and consumers — both retail and corporate.

With the CBDC designed to complement Jamaica’s banknotes, financial institutions will be able to issue the digital currency to individual and business account holders at a rate of one CBDC “coin” to one Jamaican dollar.

Byles also stated the BOJ’s plan to use the CBDC as a platform to provide financial services to the unbanked population. In this regard, the central bank governor called on the assistance of telecom firms in the country as well as their significant network of retail payment merchants.

Related: Jamaica's central bank taps Irish tech outfit for CBDC project

CBDC efforts have become a global endeavor, with central banks across the world establishing pilot studies or even launching sovereign digital currencies. A fellow Caribbean nation, the Bahamas, became one of the first countries to float a CBDC back in October 2020.

Elsewhere in the Caribbean, the Eastern Caribbean Currency Union recently launched its DCash digital currency in four or the currency union’s eight member states.

Avalanche founder Emin Gün Sirer ‘quite bullish’ on crypto market prospects

Despite the current market downturn, the Cornell University computer scientist and professor says he is bullish about crypto.

Emin Gün Sirer, creator of the Avalanche blockchain protocol, has said the current decline in crypto prices has not dampened his enthusiasm about the future of the market in general.

Speaking to Cointelegraph China, Sirer drew from his “unique vantage point” to offer some of the behind-the-scenes goings-on concerning the growing level of interest in crypto exposure among entities from outside the industry.

According to Sirer, everyone from politicians to central banks and even hedge funds have been inquiring about crypto over the last year. Indeed, the influx of hedge funds and institutional money, in general, seemed to catalyze a massive parabolic advance for the crypto market, beginning in Q4 2020 up until the market decline in May.

Now, the Cornell University professor said hedge funds are not the only big-money players coming into the crypto space.

“I have been getting contacts from retirement funds, not hedge funds, but retirement funds,” Sirer told Cointelegraph China, adding:

“Very different piece, far more slower-moving but with maybe 10 times more dollars under their control and they are slowly coming into crypto.”

The Avalanche founder’s comments are in keeping with revelations from the likes of NYDIG, which said retirement funds and sovereign wealth funds are the next major players to consider crypto exposure.

Despite Sirer’s long-term positive stance, the computer scientist stated that the short-term price action for crypto could remain locked in range-bound sideways accumulation throughout the summer months.

“I expect we will see sideways markets. This is going to be a summer where the price levels are going to maybe remain horizontal, maybe decline a little bit as well. That can happen. But I expect a resurgence back in October, November.”

Sirer also spoke about the limitations of existing blockchain protocols, such as scalability and other performance issues. As part of the interview, Sirer remarked that the architecture of existing blockchain networks is not efficient enough to support all the world’s assets.

Related: Governments are looking to buy Bitcoin, NYDIG CEO confirms

According to the professor, attempting to solve these problems led to his creation of the Avalanche blockchain. Detailing the features of Avalanche, Sirer listed attributes such as the ability to create custom blockchains called subnets and community-driven governance architecture as combinations unique to the network.

Sirer also compared Avalanche with other major blockchains in the space, adding that his protocol offers superior performance over these chains at cheaper operating costs.

EY publishes an Ethereum scaling solution to the public domain

Global auditing giant Ernst & Young has released the third iteration of its zero-knowledge proof Ethereum scaling solution.

Ernest & Young's (EY's) attempts to promote secure and private transactions over public blockchains at cheaper costs has culminated in the release of Nightfall 3.

The company announced the news via a release on July 1, stating that Nightfall 3 combines zero-knowledge proofs with optimistic rollups — zk-Optimistic Rollups — to improve transaction efficiency on Ethereum.

Indeed, zk-Rollups are one of the layer-two scaling solutions being developed to achieve scalability for networks like Ethereum, using a process of batched transfers “rolled” into one transaction.

EY’s first contribution to ZK proofs was in April 2019, previously reported by Cointelegraph at the time. In this new iteration, the EY team said that Nightfall 3 is a collection of tools for privately managing Ethereum transactions.

Nightfall 3 reportedly ZK proofs transactions into Optimistic Rollups, removing the need for all authentication nodes to verify the validity of the transactions.

Nodes that challenge invalid blocks will receive rewards, thus ensuring that only valid transactions are added to the blockchain. According to the EY team, Nightfall 3 constitutes a significant improvement in transaction efficiency and gas fee reduction.

Detailing the improvements in the zk-Rollups solution, global blockchain leader at EY Paul Brody remarked that the protocol offered the best balance of mathematical efficiency and security for private transactions on the Ethereum network.

According to the announcement, Nightfall 3’s zk-Optimistic Rollups solution can deliver almost 90% in gas fee reduction compared with public ERC-20 token transfers.

By publishing Nightfall 3 to the public domain, Brody stated in the announcement that EY was doing its part to hasten enterprise adoption of the technology.

Related: Major Auditing Firm Ernst & Young Releases Updates to Two Blockchain-Related Products

With Ethereum 2.0 is still in the works, layer-two solutions like ZK proofs and Optimistic Rollups continue to be touted as short-term solutions to increase Ethereum’s network throughput.

ZK proofs are not EY’s only exploratory work on blockchain technology. Indeed, the firm has previously published a blockchain analyzer tool. The auditing giant released a beta version of the smart contract analyzer back in April 2019.

Blockchain a panacea for corruption in state governance, says exec

An article appearing on the World Economic Forum website has made the case for blockchain adoption to fight corruption and wastage of resources in government activities.

Transparency, fairness and efficiency of government systems are some of the areas that are prime for blockchain disruption in public governance.

Writing for the WEF Global Agenda section, Matthew Van Niekerk, co-founder and CEO of blockchain-as-a-service outfit SettleMint, highlighted how blockchain adoption could improve public procurement and land registries.

According to Van Niekerk, public procurement is one of the main avenues of corruption and wastage in government. As part of the report, the SettleMint CEO argued that the closed-off nature of the process encourages illicit interaction between public officials and private businesses.

Van Niekerk surmised that blockchain adoption could facilitate a more open system of public procurement. According to the article, this larger pool of participants will draw from beyond government parastatals and private firms to include a “wider coalition of stakeholders,” such as standards organizations, consumer protection watchdogs, and the media, among others.

For Van Niekerk, blockchain adoption will leverage decentralized ledger technology to offer “easily accessible, tamper-proof and real-time window into on-going procurement processes.”

Back in October 2018, a World Bank Group report touted blockchain as a viable tool for defragmenting government procurement protocols across the globe.

Related: Australian senate committee calls for national blockchain land registry

On land registries, Van Niekerk pointed to blockchain as a possible solution to problems surrounding inefficiencies in registration titling systems.

According to Van Niekerk’s article, a blockchain-based registry system will help to eliminate land transaction bottlenecks, thus removing the need for bribes and other less-than-legal activities required to speed up the process.

Land registries are indeed one of the more ubiquitous adoption cases for blockchain technology across the globe. From Sweden to Australia and even countries in Africa, state governments are pursuing distributed ledger technology adoption for land registries.

Bitcoin.org blocks access to Bitcoin software download in the UK

Apart from removing the white paper, Cøbra has removed access to Bitcoin software for site visitors from the United Kingdom.

It is no longer possible to download the Bitcoin Core software from Bitcoin.org if you visit the website with a United Kingdom internet protocol (IP) address. A notice on the website reads: “This software is presently not available for download in the UK, and download links will not work if you are located within the United Kingdom.”

Indeed, attempting to proceed with downloading the Bitcoin (BTC) software from the site using a U.K. IP returns a “404 error.”

Detailing the reason for blocking access to the software download for U.K. site visitors, Bitcoin.org’s pseudonymous owner Cøbra responded to a tweet stating:

“The white paper is in the blockchain and can be retrieved through the software. I’m not allowed to distribute the whitepaper on bitcoin.org, or ‘in any other way.’ We have to follow the law.”

As previously reported by Cointelegraph, a U.K. court ruled in favor of self-proclaimed Bitcoin creator Craig Wright in a copyright infringement case against Cøbra and Bitcoin.org for hosting the Bitcoin white paper.

However, the default judgment was only because Cøbra elected not to mount a defense. As part of the ruling, Cøbra was also instructed to cover Wright’s legal fees to the tune of 35,000 British pounds (about $48,600).

Related: Craig Wright wins default judgment, Bitcoin.org must remove Bitcoin white paper

The judgment is the latest salvo in Wright’s assault on people who dispute his claim of being Bitcoin creator Satoshi Nakamoto. In January, Wright demanded that Bitcoin.org, Bitcoin.com, and Bitcoincore.org remove copies of the Bitcoin white paper from their respective websites.

Wright continues to maintain that Bitcoin white paper is his intellectual property. Meanwhile, he continues to be a proponent of Bitcoin SV (BSV), a factional chain that split off from Bitcoin Cash (BCH) which is itself another forked chain from Bitcoin.

The Bitcoin software download is still available on Bitcoincore.org, even for visitors with U.K. IP addresses as of the time of writing.

Indeed, geofencing the download link on Bitcoin.org is not likely to impact people interested in running Bitcoin Core in the country, given the multitude of workarounds like virtual private networks and other websites that host the software.

$200M hedge fund pauses crypto arbitrage trading amid market downturn

The hedge fund co-founder says it is keeping its investment powder dry for when the crypto market resumes its parabolic advance.

Crypto hedge fund Nickel Digital Asset Management cycled into a cash position following the crypto market collapse of May.

According to Bloomberg, the $200 million crypto hedge fund led by JPMorgan and Goldman Sachs alumni redeployed its capital in anticipation of another explosive price run for cryptocurrencies.

Prior to piling into a cash position, Nickel Digital focused on cryptocurrency arbitrage opportunities resulting from cryptocurrency price differences across the spots and derivatives markets.

Indeed, crypto arbitrage trading reportedly offered double-digit annualized gains for institutional investors with sufficient capital to make sizable returns on these momentary price gaps. These trades are market neutral rather than directional since the focus on price discrepancies and not price action.

Commenting on the fund’s investment thesis, Nickel Digital CEO Anatoly Crachilov told Bloomberg: “We don’t take directional bets, so whether Bitcoin goes up 300% or down 70%, we will seek to capture arbitrage opportunities from market dislocations,” adding:

“Our market-neutral, low volatility strategy is designed to provide positive returns irrespective of market directionality. It’s meant to make a transition into the crypto market easier for investors with lower risk tolerance.”

Nickel Digital has reportedly earned 29% in gains at 3% volatility, far lower than the 78% market average for crypto assets. However, Bitcoin’s (BTC) blow-off top back in April and the ensuing altcoin capitulation in May has reportedly upended these arbitrage opportunities for hedge funds like Nickel Digital.

Bitcoin’s 50% crash from its $64,000 all-time high triggered a cascade of liquidations in the futures market especially for over-leveraged longs to the tune of about $9 billion. Altcoins also crashed more than 70% and price action has remained in a sideways accumulation state with frequent 10 to 15% dips.

Related: ‘Bitcoin will go all the way to $160,000 this year,’ says Celsius CEO

For Crachilov, it is all about playing the waiting game, for now: “June will be remembered as a cash-rich, wait-and-see month.” The Nickel Digital CEO also stated that the current market downturn is not out of the ordinary for investors long in the crypto business.

The crypto hedge fund chief stated that institutional investors are starting to move away from seeing crypto investments as a reputational risk. Indeed, banks in the United States and Europe are beginning to offer direct exposure to Bitcoin for both retail and big-money players.

Back in June, Alex Mashinsky, CEO of crypto lending platform Celsius, told Cointelegraph that he sees Bitcoin reaching a new all-time high of $160,000 before the end of the year.