Luxor Technology, a Bitcoin mining firm, is gearing up to launch a unique hash rate-backed product, promising investors returns ranging from 10% to 13%.
This offering distinguishes itself from previous cryptocurrency lending and borrowing platforms like BlockFi and Celsius, which have faced controversy and skepticism.
In a recent episode of the What Bitcoin Did podcast, Luxor’s product was scrutinized for its potential risks.
However, Luxor’s Head of Derivatives, Matt Williams, clarified that their product stands apart due to its foundation in actual proof-of-work and tangible economic activity.
He emphasized that the returns come from miners willingly sharing a portion of their mining margins with investors who finance their operations, not from dubious schemes or rehypothecation.
The process revolves around investors providing Bitcoin as collateral to Luxor, which, in turn, lends it to other miners for their operations.
Profits are generated by acquiring hash rate from Bitcoin miners at a discounted rate and subsequently selling it at a higher price.
Luxor estimates that investors can expect returns between 10% and 13% through this mechanism, facilitated by Luxor’s upcoming hash rate marketplace.
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Importantly, Luxor operates as an intermediary between investors and mining firms, avoiding direct involvement in mining activities.
This structure allows miners to access capital without selling their mined Bitcoin holdings, offering them a more sustainable financial option.
Joe Kelly, the CEO of Bitcoin lending firm Unchained, advised caution for those considering investing or borrowing with Bitcoin.
He emphasized the need for diligent scrutiny and vigilance due to the nascent nature of Bitcoin lending and borrowing markets, referencing previous failures with platforms like BlockFi and Celsius.
Williams emphasized that Luxor’s hash rate-backed product will be available exclusively to individuals who pass the firm’s rigorous due diligence checks.
Luxor acknowledges the inherent apprehension stemming from past failures in the cryptocurrency lending space and plans to mitigate risks by collaborating only with reputable miners and possibly mandating insurance coverage.
While Luxor did not specify a release date for its product, it aims to provide a novel and more secure way for investors to leverage their Bitcoin holdings while supporting the mining industry’s growth.
The anticipation surrounding the potential approval of a Bitcoin exchange-traded fund (ETF) is not only driving up Bitcoin prices but also fueling a renewed enthusiasm for blockchain-based games, according to Animoca Brands founder Yat Siu.
Speaking during Hong Kong Fintech Week, Siu emphasized that the recent price surges in various cryptocurrencies have rekindled investor confidence in the Web3 gaming sector, resulting in increased on-chain activity.
Siu highlighted that token values play a crucial role in instilling confidence among users and providing utility beyond mere monetary gains.
He stressed that confidence in what one owns is just as essential as the financial aspect of investments.
Siu pointed out that when an industry or a country fails to grow despite high prices, people can lose faith in it.
Measuring investor confidence is not a straightforward task, but Siu argued that assessing growth and conviction in the GameFi sector is best achieved by examining on-chain activity closely.
Instead of relying solely on token prices to gauge success, he urged investors to consider various factors, similar to assessing a country’s economy through multiple indicators.
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Recent data backs Siu’s assertions. Over the past month, Axie Infinity, the most popular blockchain-based game in Animoca’s portfolio, witnessed a 50% increase in transaction activity and a 14% rise in trading volume, as reported by DappRadar.
Siu emphasized that the entire crypto ecosystem remains heavily reliant on Bitcoin’s growth for its overall success, even as many crypto industry players view their offerings as distinct and separate from the broader market.
He described Bitcoin as the reserve currency of Web3, stating that how it’s used, stored, and owned underpins much of the crypto market’s value.
Siu expressed confidence that the approval of a spot Bitcoin ETF would significantly benefit the entire industry by adding legitimacy and attracting new investments from traditional financial institutions.
He predicted that the crypto sector would eventually outgrow its dependence on Bitcoin, similar to how the global economy moved away from the gold standard.
As populations and economies continue to expand, Siu believes that the crypto industry will evolve into more natural and efficient systems.
However, he acknowledged that despite its substantial $1 trillion size, Web3 engagement remains limited to a relatively small global population.
On November 3, BTC Digital, a China-based company, announced a significant expansion of its Bitcoin mining operations by acquiring 220 new Bitcoin mining units.
This strategic move has boosted their total machine count to 2,174, with a formidable computing power of over 230 petahashes per second (PH/s).
These newly acquired mining units are expected to be fully operational by the end of the month.
The acquisition was executed through agreements with “two unaffiliated third parties,” involving the procurement of Bitmain Antminer S19j Pro units.
In exchange for these mining units, BTC Digital issued 276,572 shares of its ordinary company stock, with a total valuation of $968,800.
It’s worth noting that BTC Digital underwent a name change in August, transitioning from Meten EdtechX Education Group to better align with its current business operations.
BTC Digital is described on the Nasdaq-listed company’s website as a prominent provider of general English language training services in China.
The company boasts a network of learning centers across the nation and offers both online and metaverse-based training programs.
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However, there have been indications, such as a Reddit thread that emerged on November 11, 2022, suggesting that the company abruptly halted its teaching operations.
In late 2021, BTC Digital ventured into Bitcoin mining by deploying 1,482 miners, as mentioned in an undated profile on its website.
These mining farms were situated in the American states of Pennsylvania and Tennessee and operated by third-party entities. CEO Alan Peng expressed his outlook on the recent expansion, stating, “With the recent purchases and our plan to further increase the number of mining machines, we aim to continue improving our financial conditions as well as maximizing value for our shareholders.”
BTC Digital’s market capitalization stood at $3.1 million as of September 28, following a low point of $1.79 per share on September 26.
After rebranding from METX to BTCT on September 28, the company experienced increased trading activity, with shares currently valued at $3.66 at the time of this writing.
It’s worth noting that China initiated a crackdown on domestic Bitcoin mining activities in the latter half of 2021, although the efficacy of these efforts remained partially uncertain.
On November 4th, Bitcoin was on a quest to surpass the $35,000 mark as weekend trading activities continued to exhibit upward consolidation trends.
Market data from Cointelegraph Markets Pro and TradingView indicated that BTC’s price support remained resilient even after the closure of Wall Street trading.
Despite experiencing intraday lows the previous day, Bitcoin managed to maintain its short-term price floor at $34,000, effectively passing the test.
This performance had traders eagerly anticipating potential upward movements, making Bitcoin a preferred choice among investors.
In a recent video update, the well-known trader Credible Crypto highlighted the likelihood of Bitcoin surpassing the $35,000 threshold as the next logical step.
Credible Crypto employed Elliott Wave analysis and identified three crucial price levels to monitor: $34,314, $34,714, and $35,119, representing the lower limit, midrange point, and upper limit of the expected range.
Credible Crypto emphasized the importance of successfully reclaiming the midrange level, indicating a shift from a recovery based on range lows to one based on midrange levels.
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This approach was bolstered by robust trading volume, which Credible Crypto described as a “significant event,” along with a general reluctance to sell at the current price levels.
As traders contemplated the weekend and the upcoming weekly close, Daan Crypto Trades drew attention to the proximity of the CME Bitcoin futures closing price on November 3rd.
CME futures “gaps” had historically been closed in line with BTC’s spot price, with a notable exception near $20,000. This anomaly contributed to bearish predictions of a potential return to that price level in the months ahead.
Additionally, another trader named Jelle highlighted the significance of the 200-period exponential moving average (EMA) as a critical support line on 1-hour timeframes.
Crypto Tony, on the other hand, shared his strategy with subscribers, indicating that he would consider a hedge short position if Bitcoin dropped below $34,100, while still maintaining his long position as long as Bitcoin held above $33,000.
In summary, Bitcoin was aiming to surpass the $35,000 mark, with traders closely monitoring key price levels and indicators to determine the cryptocurrency’s future trajectory amidst the ongoing market consolidation.
Marathon Digital has embarked on a groundbreaking initiative to mine Bitcoin using eco-friendly power generated from methane gas harvested from a landfill site.
This off-grid pilot project, boasting a 280-kilowatt (kW) capacity, is currently operational in the state of Utah.
Collaborating closely with Nodal Power, a company established in November 2022, Marathon has taken the lead in harnessing energy from landfill gas across the southeastern United States and Texas.
Notably, Nodal Power successfully secured $13 million in funding during an August seed round to manage two prominent sites, one of which houses a cutting-edge data center.
Marathon’s visionary mission extends beyond this pioneering project, as the company aims to validate its ability to capture methane emissions from landfills, convert these emissions into electricity, and subsequently employ this electricity to power Bitcoin mining operations.
Marathon’s CEO, Fred Thiel, expressed his optimism regarding the venture, stating, “Should the results of the pilot project meet our expectations, we look forward to expanding our footprint in this area and helping landfill operators and others meet their environmental targets.”
This endeavor aligns with a growing trend in the Bitcoin mining industry, where green energy solutions are highly sought after.
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For instance, Genesis Digital Assets Limited established an 8-megawatt facility in Sweden in August that relies on hydropower, further highlighting the industry’s commitment to sustainability.
Marathon’s commitment to sustainability doesn’t stop at landfill projects. In late October, the company inaugurated a state-of-the-art 200-MW immersion-cooled facility in Masdar City, Abu Dhabi, a model of sustainable living.
Additionally, a report released by Marathon in the same month emphasized the practicality and advantages of crypto mining at landfill sites, not only for miners and landfill owners but also for the environment.
This initiative gains significant importance considering that methane emissions, as per the United Nations, have a far more detrimental impact on the environment than carbon dioxide emissions.
Despite reporting second-quarter earnings that fell short of expectations, Marathon achieved a milestone by mining a record 2,926 Bitcoins in the same period.
Their Q2 revenue also surged, with a year-on-year increase of 228% to reach $132.8 million.
Marathon Digital’s commitment to sustainable and environmentally conscious Bitcoin mining marks a promising step towards a greener and more responsible future for the cryptocurrency industry.
MicroStrategy, a prominent business intelligence firm, has witnessed a remarkable paper gain of $900 million on its substantial holding of 158,400 Bitcoins.
This significant surge in value has been primarily driven by the growing optimism surrounding the potential approval of spot Bitcoin exchange-traded funds (ETFs).
The company, founded by Michael Saylor, has continued to bolster its Bitcoin reserves, acquiring an additional 6,067 BTC since the third quarter, including a substantial purchase of 155 Bitcoins in October, as outlined in MicroStrategy’s November 1st financial report.
CEO Phong Le expressed the company’s unwavering commitment to its Bitcoin strategy, emphasizing that they have no plans to deviate from this path, especially with the promising prospect of increased institutional adoption on the horizon.
Despite a 3% year-on-year increase in revenue, reaching $129.5 million in the last quarter, MicroStrategy found itself in the red, reporting a net loss of $143.4 million.
This outcome highlights the company’s strong focus on accumulating and holding Bitcoin as a core part of its financial strategy.
During the third quarter (July 1 to Sept. 30), Bitcoin experienced a temporary dip, falling by 11.5% from $30,480 to $26,970.
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MicroStrategy seized this opportunity to increase its Bitcoin holdings by purchasing 6,067 BTC at an average price of $27,590.
In addition to their Bitcoin investments, MicroStrategy is also confident in the positioning of their artificial intelligence-integrated business analytics products.
Their software licenses and subscription services demonstrated impressive growth, rising by 16% and 28% year-over-year, respectively.
Phong Le expressed his belief in MicroStrategy’s ability to benefit from both the positive trends in the Bitcoin market and the expansion of their business intelligence (BI) offerings, stating,
“We believe MicroStrategy is well situated to capitalize on both the tailwinds in Bitcoin and growth in our BI business.”
Following the release of these financial results, MicroStrategy’s stock price (MSTR) surged by 2.7% in after-hours trading, reaching $438 according to Google Finance.
This upward movement underscores the market’s approval of the company’s strategic direction and its bullish stance on Bitcoin.
Invesco and Galaxy’s spot Bitcoin exchange-traded fund (ETF), BTCO, has reached a notable milestone in its application process.
The ETF’s ticker, BTCO, has recently made its appearance on the Depository Trust and Clearing Corporation’s (DTCC) website, a development observed within the past six days. Comparatively, there was no record of BTCO listed on October 25.
However, it is essential to emphasize that the inclusion of a ticker in the “ETF Products” section of the DTCC’s site does not guarantee the eventual approval of the product.
A spokesperson from DTCC clarified that it is a customary practice for the organization to add securities to the NSCC (National Securities Clearing Corporation) security eligibility file “in preparation for the launch of a new ETF to the market.”
The spokesperson further noted that being listed does not serve as an indicator of the outcome of any pending regulatory or approval processes.
The application for the joint spot Bitcoin ETF, managed collaboratively by the global investment firm Invesco and the crypto asset fund Galaxy Digital, was reactivated on June 21.
This decision to renew the application occurred amidst a surge of similar filings for spot Bitcoin ETF products, a trend set in motion by the prominent investment firm BlackRock, which submitted its groundbreaking application for a spot Bitcoin ETF on June 15.
As the BTCO ticker finds its place on the DTCC’s website, it signifies a step forward in the application process, but the final outcome remains uncertain.
The ETF landscape continues to evolve, influenced by a wave of applications and regulatory developments, with industry players eagerly awaiting clarity on the future of these financial instruments.
In October 2023, Bitcoin achieved its highest monthly closing price since May 2022, experiencing a remarkable uptrend throughout the month. Data from Cointelegraph Markets Pro and TradingView verified that Bitcoin bulls successfully maintained their upward momentum into November 1st.
This surge in the cryptocurrency’s value was reminiscent of October’s initial breakout, and it marked the second-best performing month of 2023, with Bitcoin gaining an impressive 28.5%.
This performance only trailed behind January, which had a 39.6% increase.
Renowned trader Bluntz cautioned against underestimating the significance of the current bullish trend, drawing parallels to similar occurrences in October 2020 and April 2019, where Bitcoin entered extended bullish phases.
Moustache, another prominent figure in the crypto trading community, pointed to the TK Crossover indicator, which signaled a rare bull market trigger.
This indicator, derived from the Ichimoku Cloud and involving Tenkan-sen and Kijun-sen trendlines, produced a bull flag at the monthly close, indicating a potential sustained upward trend.
However, on-chain monitoring resource Material Indicators offered a slightly more conservative view, suggesting that while bullish momentum still persisted, it appeared to be weakening compared to the previous month.
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They anticipated a possible retest of the $33,000 level, though it might not occur until after an attempt at $36,000.
Market participants remained vigilant, as a significant macroeconomic event was on the horizon. The United States Federal Reserve was set to announce its interest rate policy in the context of a challenging inflation environment.
Federal Reserve Chair Jerome Powell was also scheduled to deliver a speech and hold a press conference.
Market expectations were leaning toward the Federal Open Market Committee (FOMC) maintaining the current elevated interest rates, with a probability of nearly 98% according to CME Group’s FedWatch Tool.
Prominent trader Crypto Tony weighed in on the potential impact of this announcement on Bitcoin’s price action, predicting increased volatility and market movements as the Fed’s decisions and data were released.
He personally anticipated a pause in interest rate hikes and a subsequent rise in Bitcoin’s price, possibly reaching the $36,000 mark after an initial temporary downturn.
In summary, Bitcoin’s performance in October 2023 was exceptional, with significant gains and indications of a potential sustained bullish trend.
However, the market remained watchful of the upcoming Federal Reserve announcement, which could introduce further volatility and shape the cryptocurrency’s future movements.
Crypto exchange-traded products (ETPs) have experienced a remarkable surge in investor interest, marking their highest weekly inflows in over a year, as reported by CoinShares, a prominent asset management platform.
The data released on October 30 reveals that inflows for the week ending October 27 amounted to a staggering $326 million, dwarfing the previous week’s meager $66 million.
ETPs are investment instruments that offer exposure to the performance of specific assets, with crypto ETPs typically tracking the prices of major cryptocurrencies like Bitcoin and Ether.
Many investors opt for these funds to gain crypto exposure, avoiding the complexities of holding these digital assets directly, as ETP shares can be held in conventional brokerage accounts.
In the world of ETPs, “inflows” occur when the fund’s price rises more rapidly than the underlying asset, prompting the fund to acquire more of the asset, generally considered a bullish indicator.
Conversely, “outflows” transpire when the fund is forced to sell the asset due to declining note or share prices relative to their target, typically seen as bearish.
CoinShares’ latest report underscores the impressive nature of this surge in investor interest, with the $326 million weekly inflow being the most substantial since July 2022, a span of 15 months. Moreover, this marked the fifth consecutive week of positive ETP inflows.
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One potential explanation for this sudden uptick in inflows, according to CoinShares, may be the mounting optimism among investors regarding the potential approval of a spot-based Bitcoin ETF by the U.S. Securities and Exchange Commission (SEC).
Such approval could pave the way for substantial inflows into U.S.-based funds upon acceptance.
Despite the significant rise in inflows, this week’s figures only rank as the 21st largest increase ever recorded, as per CoinShares.
The lion’s share of the weekly inflows went into Bitcoin ETPs, accounting for a remarkable 90% of the total.
Solana’s SOL also benefited from the prevailing market optimism, garnering $24 million in inflows. However, Ether funds experienced an adverse trend, witnessing outflows of $6 million.
Despite numerous applications submitted over the years, the SEC has yet to grant approval for a spot Bitcoin ETP.
Some companies, like Van Eck, recently amended their applications to address the agency’s concerns, while Hashdex engaged with the SEC on October 25 in pursuit of approval for their spot Bitcoin ETP.
The Depository Trust and Clearing Corporation (DTCC) has added the ticker symbol for Invesco and Galaxy’s spot Bitcoin exchange-traded fund (ETF), known as BTCO, to its website, signaling a significant step forward in the application process for these two asset management firms.
This development has taken place within the last six days, as the web archiver Wayback Machine did not display any listing for the BTCO ticker on October 25.
It’s important to note that having a ticker added to the list of “ETF Products” on the DTCC’s website does not guarantee the future approval of the product.
A DTCC spokesperson emphasized that this is a standard practice aimed at preparing for the launch of a new ETF in the market.
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The spokesperson clarified that being listed is not indicative of the outcome of any pending regulatory or approval processes.
The joint spot Bitcoin ETF managed by Invesco, a global investment firm, and Galaxy Digital, a crypto asset fund, had its application reactivated on June 21.
This decision to resubmit the application to the Securities and Exchange Commission (SEC) occurred in response to a surge in similar filings for spot Bitcoin ETF products.
The wave of applications was initiated by BlackRock, a prominent investment giant, which submitted its groundbreaking application for a spot Bitcoin ETF on June 15.
The addition of BTCO to the DTCC’s list indicates the progress made by Invesco and Galaxy Digital in navigating the regulatory landscape for their Bitcoin ETF.
However, it’s essential to understand that regulatory approval remains a separate and crucial step in the process.
The ETF industry is closely watching these developments, as the potential approval of Bitcoin ETFs could open up new opportunities for investors and further legitimize cryptocurrencies as an asset class.