Top Headlines
▌Tether Holds 25% Stake in Bitdeer, Second Largest Shareholder
According to a document disclosed by the US Securities and Exchange Commission, UST issuer Tether currently holds a 25% stake in Bitcoin mining company Bitdeer. This makes the company behind Tether (USDT) the second largest shareholder of BTC mining equipment, after Victory Courage Ltd., reportedly registered under the name of Wu Jihan.
▌Telegram CEO: Introducing Telegram Stars, Supporting Mini Programs to Accept Digital Service Payments
Telegram CEO Du Rove announced on 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 in-app on Android and iOS, allowing for the use of apps like Notcoin without installation. Developers can use TON to extract Stars through Fragment and promote apps on Telegram with favorable terms using Stars. When users purchase Stars from Apple and Google, a 30% fee is 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 Step Up Anti-Illegal Gambling Campaign, Focus on Virtual Currency Betting
With the European national cup approaching, Hong Kong police are intensifying efforts to combat illegal online gambling, noting an increase in websites accepting virtual currency bets. Police point out that the anonymity and convenience of virtual currencies increase the risks of illegal gambling, but both cryptocurrencies and stored payment tools are under surveillance. Police will combat related crimes using money laundering charges and cooperate with mainland China and Macau. To this end, police will conduct outreach in various areas, including distributing flyers in bars.
Police data shows that last year there were over 790 anti-illegal gambling operations, leading to the arrest of around 6,100 individuals. In the first three months of this year, police cracked down on 99 related cases, a nearly 30% decrease from the same period last year. Police also note that the average age of first-time gambling participants has dropped to around 18, with the widespread internet access making young people more susceptible to illegal gambling.
▌New York Attorney General Sues NovaTech for $1 Billion Cryptocurrency Fraud
New York Attorney General Letitia James has filed a lawsuit against cryptocurrency company NovaTech and its founders, Cynthia and Eddy Petion, for an alleged $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 reporting its licensing and registration status. The company collapsed in May 2023.
The Petion couple’s previous venture, AWS Mining, has also been accused of being a Ponzi scheme. James seeks to recover illicit gains and prohibit them from operating in New York. Currently, the NovaTech website is still operational, claiming that company funds were lost in a data breach and are being recovered.
Blockchain Applications
▌zkSync: Begins v24 Upgrade, Funds to Be Moved to New Bridge Contract
According to an announcement from the zkSync developer account on X platform, the v24 upgrade has started, with a new L1SharedBridge being a new L1 contract. As a result, funds on the zkSync Era will be migrated from the old contract to the new one, ensuring the safety of users’ funds.
▌LayerZero CEO: Witch Hunt Not Yet Over
LayerZero CEO Bryan Pellegrino posted on X platform, stating, “To those asking when the witch hunt (audit) will end,” accompanied by an image saying, “The work is not finished.”
▌Alchemy Launches Rollup Tool to Help Developers Create Custom Layer2 Solutions
Web3 infrastructure company Alchemy has launched a new Rollup tool aimed at helping developers create their own blockchain. This tool enables developers to easily build and deploy custom Layer 2 chains, improving 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, especially in decentralized finance (DeFi) and other Web3 domains.
Cryptocurrency
▌Kraken Plans to Raise Over $1 Billion in Funding Before IPO
According to Bloomberg, cryptocurrency exchange Kraken is in negotiations to raise funding before its IPO. Kraken is seeking to raise over $1 billion in funding, with the expectation of completing this before the end of the year. Rumors of Kraken going public have been circulating for the past few years. The company has been busy responding to allegations by the US Securities and Exchange Commission (SEC) last year, accusing it of operating an unregistered platform and mishandling client funds. A spokesperson declined to comment on the funding but stated, “We are always exploring strategic paths to achieve Kraken’s mission: to accelerate the global adoption of cryptocurrency. We remain focused on investing in this goal.”
▌Analysis: Power Contracts and Lower Valuations Could Drive Consolidation in Cryptocurrency Mining Stocks
On Thursday, Bitcoin mining stocks outperformed other cryptocurrency-related stocks, with several industry takeover offers sparking market attention on who might be the next target. Recently, one of the largest miners, Riot Platforms (RIOT), initiated a hostile takeover of fellow miner Bitfarms (BITF), while artificial intelligence company CoreWeave proposed acquiring another large mining enterprise, CoreScientific (CORZ).
Although Bitfarms and CoreScientific rejected the takeover 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 act as catalysts for a phase of consolidation in mining stocks. In a report, he wrote, “We believe the optimistic outlook in the power market may catalyze an increase in M&A activity this year, especially when significant valuation discrepancies still exist.”
▌MicroStrategy Faces Highest Institutional Short Position, Strongest Bearish Sentiment
MicroStrategy (MSTR) faces a net short position of approximately $6.941 billion, representing 23.14% of its market value, indicating strong bearish sentiment or widespread hedging demand. This high ratio could lead to increased market volatility and may even trigger short squeezes.
In contrast, Coinbase (COIN) with a market value of around $62 billion has a net short position of $1.129 billion, representing 1.77% of its market value, showing relatively mild bearish sentiment. 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 strategic hedging, for example, Kerrisdale Capital simultaneously shorting MSTR and longing Bitcoin.
Fintel’s data highlights MicroStrategy facing the highest net short position among the three companies.
▌FTX Creditors Oppose Restructuring Plan, Citing Tax Issues with Cash Payments
A group of FTX creditors led by Sunil Kavuri has submitted objections to the court against the restructuring plan proposed by the FTX bankruptcy trustees. Creditors point out that the plan fails the best interest test, includes provisions that do not align with estate interests, and overlooks property rights issues.
Creditors argue that cash payments will require customers to pay taxes on the received cash, adding to the burden. They suggest opting for in-kind payments to avoid tax issues.
Additionally, creditors request FTX to update the 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%, with other non-government creditors receiving full claims and up to 9% interest compensation.
▌US Prosecutes Three in Evolved Apes NFT Scam, Involving $3 Million
The US Attorney’s Office for the Southern District of New York 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 ended, the anonymous developer, Evil Ape, disappeared, transferring 798 ether (about $3 million). This case is considered part of a “rug pull” scam, where developers raise funds through NFT or token sales, then abruptly shut down the project and disappear. Similar scams since 2011 have resulted in over $14.5 billion in losses.
▌Total Value Locked in All DeFi Protocols Currently at $109.9 Billion
According to DefiLlama data, the total value locked (TVL) in all DeFi protocols is currently $109.9 billion, with Lido holding the highest TVL at $36.6 billion, up 1.27% in the past 24 hours; EigenLayer ranking second at $20.1 billion, up 1.88% in the past 24 hours; and AAVE ranking third at $13.2 billion, up 0.71% in the past 24 hours.
Key Economic Dynamics
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What is Liquidity Staking?
Liquidity staking allows stakeholders to maintain liquidity by using alternative tokens to stake their assets, enabling them to earn additional income through DeFi protocols. Liquidity staking enables cryptocurrency holders to participate in staking without relinquishing control over their holdings. This changes the way users stake their assets. Projects like Lido have introduced liquidity staking to tokenize staked assets in the form of tokens and derivatives.
