Top News
▌ Tether holds a 25% stake in Bitdeer, making it the second largest shareholder
According to a filing from the U.S. Securities and Exchange Commission, the issuer of UST, Tether, currently holds a 25% stake in the Bitcoin mining company Bitdeer. This makes the company behind Tether (USDT) the second largest shareholder of BTC mining machines, second only to Victory Courage Ltd., reportedly registered under the name of Wu Jihan.
▌ Telegram CEO to launch Telegram Stars, supporting mini programs to accept digital service payments
Telegram CEO Du Rove announced on the Telegram channel the launch of Telegram Stars, a way to pay for digital services through mini programs. Mini programs can accept payments for digital services and can be purchased within apps on Android and iOS, without the need for installations such as Notcoin. Developers can use TON to extract Stars through Fragment and further promote their apps on Telegram with special conditions using Stars. When users purchase Stars from Apple and Google, a 30% fee will be deducted, but Telegram will subsidize ads purchased with Telegram Stars.
Market Update
As of the time of writing, according to Coingecko data:
– BTC recent trading price is $70,772.40, with a 0.5% daily change
– ETH recent trading price is $3,811.99, with a 1.5% daily change
– BNB recent trading price is $709.72, with a 0.4% daily change
– SOL recent trading price is $170.55, with a 1.9% daily change
– DOGE recent trading price is $0.1602, with a 2.0% daily change
– XPR recent trading price is $0.5217, with a 0.9% daily change
Policy
▌ Hong Kong police strengthen anti-illegal gambling promotion, focus on virtual currency betting
With the upcoming European national cup, Hong Kong police are cracking down on illegal online gambling, as more websites are accepting virtual currency bets. The police point out that the anonymity and convenience of virtual currencies increase the risks of illegal gambling, but both cryptocurrencies and stored value payment tools are under monitoring. The police will combat related crimes under the charge of money laundering and cooperate with mainland China and Macau. In light of this, the police will distribute flyers in various areas, including bars.
According to police data, over 790 operations against illegal gambling were conducted last year, resulting in the arrest of approximately 6,100 individuals. In the first three months of this year, the police investigated 99 related cases, a decrease of nearly 30% compared to the same period last year. The police also noted that the average age of first-time gamblers has dropped to around 18, as the widespread use of the internet makes it easier for young people to access illegal gambling.
▌ New York Attorney General sues NovaTech for $1 billion cryptocurrency fraud
New York Attorney General Letitia James has filed a lawsuit against the cryptocurrency company NovaTech and its founders Cynthia and Eddy Petion, alleging their involvement in a $1 billion fraud. The lawsuit claims that over 11,000 New York residents lost millions of dollars by investing in NovaTech. NovaTech is accused of being a Ponzi scheme and falsely claiming its licenses and registration status. The company closed in May 2023.
The Petion couple, who previously founded AWS Mining, are also accused of running a Ponzi scheme. James seeks to recover illegal profits and prohibit them from operating in New York State. Currently, the NovaTech website is still operational, claiming that the company’s funds were lost in a data breach and are in the process of recovery.
Blockchain Applications
▌ zkSync: v24 upgrade has begun, funds will be migrated to a new bridging contract
According to an announcement from the zkSync developer account on X platform, the v24 upgrade has started. L1SharedBridge is a new L1 contract, so funds on the zkSync Era will be migrated from the old contract to the new one, ensuring the security of user funds.
▌ LayerZero CEO: Witch hunt work is not yet complete
LayerZero CEO Bryan Pellegrino posted on the X platform, addressing those inquiring about the status of the witch hunt affairs, accompanied by the image “The work is not yet done.”
▌ Alchemy launches Rollup tool to help developers create customized Layer2 solutions
Web3 infrastructure company Alchemy has introduced a new Rollup tool to assist developers in creating their own blockchain solutions. This tool enables developers to easily build and deploy custom Layer 2 chains, enhancing development efficiency and simplifying the application of blockchain technology. Alchemy states that the release of this tool will drive the widespread adoption of blockchain technology, particularly in the decentralized finance (DeFi) and other Web3 sectors.
Cryptocurrency
▌ Kraken plans to raise over $1 billion in funding before IPO
According to Bloomberg, the cryptocurrency exchange Kraken is in negotiations to raise funds before its IPO. Kraken is seeking to raise over $1 billion, with the fundraising expected to be completed by the end of this year. Rumors of Kraken going public have been circulating for the past few years. The company has been dealing with charges brought by the U.S. Securities and Exchange Commission (SEC) last year, alleging that it operated an unregistered platform and mishandled customer funds. A spokesperson declined to comment on the fundraising but stated, “We are continuously exploring strategic paths to achieve Kraken’s mission: to accelerate the global adoption of cryptocurrencies. We remain focused on investing in this goal.”
▌ Analysis: Power contracts and lower valuations could catalyze consolidation in the crypto mining industry
On Thursday, Bitcoin mining stocks outperformed other cryptocurrency-related stocks, with several industry acquisition offers drawing attention to who might be the next target. Recently, one of the largest miners, Riot Platforms (RIOT), initiated a hostile takeover of fellow Bitfarms (BITF), while the artificial intelligence company CoreWeave proposed acquiring another large miner, CoreScientific (CORZ).
Although Bitfarms and CoreScientific rejected the acquisition offers, these attempts signal that the industry may be ready for consolidation. B. Riley analyst Lucas Pipes suggests that power contracts and lower valuations could be catalysts for initiating a phase of consolidation in mining stocks. In a report, he wrote, “We believe the optimistic outlook for the power market could catalyze an increase in M&A activity this year, especially given the significant disparities in valuations.”
▌ MicroStrategy faces the largest institutional net short position, indicating strong bearish sentiment
MicroStrategy (MSTR) faces a net short position of approximately $6.941 billion, accounting for 23.14% of its market value, suggesting strong bearish sentiment or widespread hedging demand. This high ratio could lead to increased market volatility and even trigger a short squeeze.
In contrast, Coinbase (COIN) with a market value of around $62 billion has a net short position of $1.129 billion, accounting for 1.77% of its market value, indicating relatively mild bearish sentiment. Meanwhile, Marathon Digital Holdings (MARA) with a market value of around $6 billion has a net short position of $101 million, accounting for 1.68% of its market value.
These net short positions may be part of a strategic hedge, such as Kerrisdale Capital simultaneously shorting MSTR and longing Bitcoin.
Fintel’s data highlights the highest net short position faced by MicroStrategy among the three companies.
▌ FTX creditors oppose restructuring plan, citing tax issues with cash payments
A group of FTX creditors led by Sunil Kavuri have submitted objections to the court against the restructuring plan proposed by FTX’s bankruptcy administrators. Creditors point out that the plan fails the best interest test, contains clauses that are not in line with estate interests, and overlooks property rights issues.
Creditors argue that cash payments would require customers to pay taxes on the received cash, increasing the burden. They suggest adopting physical payments to avoid tax issues.
Furthermore, creditors request FTX to update the settlement disclosure statement for the Internal Revenue Service (IRS). Under the settlement plan, the IRS will receive $200 million in priority claims within 60 days of approval, with an additional $685 million in subordinated priority claims paid after full customer repayment.
FTX’s restructuring plan includes compensating creditors with claims below $50,000 at 118%, while other non-government creditors will receive full claims and up to 9% interest compensation.
▌ U.S. sues three individuals in Evolved Apes NFT scam, involving $3 million
The U.S. Southern District of New York Attorney’s Office has filed charges against Mohamed-Amin Atcha, Mohamed Rilaz Waleedh, and Daood Hassan for their involvement in the 2021 Evolved Apes NFT scam. The project promised to develop a video game, but after fundraising, the anonymous developer Evil Ape disappeared, transferring 798 Ether (approximately $3 million). This case is considered part of a rug pull scam, where developers raise funds by selling NFTs or tokens, then abruptly shut down the project and disappear. Similar scams since 2011 have resulted in over $14.5 billion in losses.
▌ Total Value Locked (TVL) in DeFi protocols currently stands at $109.9 billion
According to DefiLlama data, the Total Value Locked (TVL) in DeFi protocols worldwide is $109.9 billion. Lido has the highest TVL at $36.6 billion, with a 1.27% increase in the past 24 hours. EigenLayer ranks second at $20.1 billion, with a 1.88% increase in the past 24 hours. AAVE ranks third at $13.2 billion, with a 0.71% increase in the past 24 hours.
Important Economic Developments
▌ The Federal Reserve to release annual bank stress test results on June 27
The Federal Reserve will release its annual bank stress test results on June 26 at 4:30 pm ET, covering 32 banks with assets of $100 billion or more. The Fed stated in a Thursday announcement that the scenarios assumed include a severe global economic downturn and pressure on the commercial and residential real estate markets. The Fed will also include an exploratory analysis of “overall results,” which will not affect bank capital requirements. Stress tests are a tool to assess whether banks have enough capital to absorb losses and continue lending to households and businesses during a severe downturn.
▌ Morgan Stanley Wealth Management CIO: U.S. stocks to further rise in the second half of the year
Morgan Stanley Wealth Management CIO Lisa Shalett predicts that the U.S. stock market will continue its upward trend in the second half of 2024, albeit at a slower pace. “From now until the end of the year, the path of least resistance is higher for the market,” said Shalett, adding that investors should have “moderate expectations” for stock returns from now until December, with the S&P 500 index already up 12% year-to-date. While Shalett remains optimistic, she notes that this year’s earnings expansion is already reflected in stock prices, and as 2024 progresses, investors will need to start “borrowing” expectations for 2025. On the bright side, she expects returns to broaden across various market sectors, not just the mega-cap tech giants that have been driving much of the rally since last year.
▌ Probability of the Federal Reserve maintaining interest rates unchanged in June is 97.6%
According to CME “Fed Watch”: the probability of the Federal Reserve keeping interest rates unchanged in June is 97.6%, with a 2.4% chance of a 25 basis point cut. The probability of the Fed maintaining interest rates unchanged through August is 78.5%, with a cumulative 21.1% chance of a 25 basis point cut and a 0.5% chance of a cumulative 50 basis point cut.
Golden Encyclopedia
▌ What is liquidity staking?
Liquidity staking allows stakers to maintain liquidity of their staked tokens by using alternative tokens, enabling them to earn additional rewards through DeFi protocols. Liquidity staking enables cryptocurrency holders to participate in staking without giving up control over their holdings. This changes the way users stake their assets. Projects like Lido have introduced liquidity staking, tokenizing staked assets in the form of tokens and derivatives.