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Bitcoin: only 20% of BTC are traded

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Over the past two weeks, the price of Bitcoin (BTC) has seen significant swings. According to data from Kaiko, this increased volatility is partly due to the decline in liquidity in the Bitcoin markets, one of the explanations can be traced back to the bankruptcy of FTX. On-chain analysis of the situation.

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A particularly volatile month of April

In the past two weeks, the price of bitcoin (BTC) has experienced significant variations, oscillating with great volatility in a range between 27,300 dollars and around 30,300 dollars.

The day of April 26 was particularly rich in emotions : First registering a 10% rise in price, a powerful fall then caused significant liquidations of participants who had bet on the rise in the derivatives markets, all in less than 24 hours.

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BTCUSD 020523

Figure 1: Daily price of BTC

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As the data from Kaikowhich we had studied during our November 2022 analysis, this increased volatility is partly due to a drop in liquidity in the BTC marketsone of whose origins dates back to the bankruptcy of FTX.

6 months after these events, we will observe in this analysis the state of the spot markets through a study of the liquidity of the supply in circulation.

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An increasingly less liquid market

Following the collapse of FTX and Alameda Research, Kaiko identified a noticeable drop in liquidity in Bitcoin marketscaused by the fall of one of the largest market makers in the sector.

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👉 Definition and explanation of what a market maker is

As this lack has not yet been filled, and certain US banks serving as an entry/exit point for institutional capital have had to close, such as Silvergate Bank or Signature, the flow of capital circulating within the global market has been limited.

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With reduced liquidity, market makers find it more difficult to balance gaps between bid and ask in order bookswhich causes an increased magnitude of price changes, or an increase in volatility.BTC Market Depth 020523Figure 2: BTC market depth

The depth of the market, put forward by Kaiko, is a very relevant indicator in this regard. By accumulating buy and sell orders within +/- 2% of the average price on different exchanges, this metric provides an excellent proxy for overall market liquidity.

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What is obvious from the graph above is that we are currently at the lowest liquidity levels in 10 monthseven lower than after the collapse of FTX.

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When market liquidity is low, the friction between supply and demand in the order books causes volatility to rise. Price variations then have more explosiveness, but less consistency, whether downward or upward.BTC Volatility 020523

Figure 3: Monthly volatility of BTC and Nasdaq

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Kaiko analyst Conor Ryder points out in a research article from March 23, 2023 that :

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“The rise in BTC in the second quarter was impressive, but […] it seems that much of this rise can be attributed to low market liquidity. Low liquidity means prices can fall as quickly as they rise, so investors can expect more volatility in the short term. »

In such a market environment, the influence of derivatives markets on the spot price is significant, so speculation can dictate the value of BTC in spot markets.

This can cause a very artificial evolution of bitcoin prices, like the volatility recorded during the day of April 26, 2023 for example.

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The state of reserves on the spot markets

In this section we will study the state of BTC reserves in the spot markets in order to anchor the lack of liquidity, explained above, in a broader context.

The BTC reserves of the exchanges have experienced a bullish momentum between 2011 and 2022peaking at 3.2 million bitcoins in March 2020, or 17.5% of the circulating supply at the time.

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Since the COVID flash crack, however, this trend has reversed.bringing exchange reserves back to where they were 5 years ago, in May 2018.

BTC Reserves CEX 020523

Figure 4: BTC reserves of centralized exchanges

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Today, nearly 2.3 million BTC are still held on centralized exchanges, now representing 12% of the supply in circulation.

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Since several CEX such as Binance, Kraken, ByBit or Bitfinex are also derivatives providers, a drop in their BTC reserves implies a drop in their liquidity. and therefore a difficulty in reducing the friction between supply and demand on their marketplaces.

The exodus of BTC from exchanges, accentuated by the collapse of FTX, therefore reinforces the fall in liquidity.

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If many BTCs are withheld and spared by participants, a phenomenon called liquidity shock takes place.which has the effect of increasing market volatility.

While this tends to favor a long-term rise in price, in response to growing demand, the short-term effects are harder to predict.

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BTC Illiquid Offer 020523

Figure 5: Illiquid BTC Supply

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The graph above represents the evolution of the number of so-called “illiquid” BTCs, with a low or non-existent spending history, mainly held outside exchanges over the long term and with a strong conviction of conservation.

Numbering 12.6 million in May 2018, illiquid BTCs are now close to 15 million. It is therefore almost 77.48% of the supply in circulation which is currently withdrawn from the liquid supply.potentially increasing friction in CEX order books.

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The state of derivatives markets

After studying the state of BTC reserves on the spot markets and the evolution of illiquid supply, let’s take a look at the derivatives markets and in particular the BTC futures markets.

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At first glance, the high volatility recorded in recent days could lead us to assume that the open interest (the total capital invested in the futures markets) must be quite high.

Nevertheless, after an ATH of speculation in November 2022, ETH and BTC open interest saw a massive purgereturning to the levels recorded in 2021 and during the first half of 2022.

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BTC & ETH OI 020523

Figure 6: BTC and ETH open interest

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Currently sitting at nearly 350,000 BTC, Bitcoin open interest has broken out of the overheated zone that we had documented within June 2022 analysis.

The collapse of FTX and the ensuing price crash obviously caused a major purge of leverageremoving over 310,000 BTC from the futures markets in the space of six months.

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So, it is obviously the lack of liquidity in the spot markets that is fueling the recent volatilitythe levels of speculation in the derivatives markets not being particularly high.

Summary of this on-chain analysis of BTC

This week’s data suggests that liquidity in bitcoin markets lowest since november 2022. The failure of FTX appears to have had a pronounced impact on market performance, causing a period of high volatility over the past few weeks.

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Exchange reserves have returned to May 2018 levels, indicating that a mass exodus of BTC from exchanges is underway. This dynamic clearly contributes to the fall in liquidity on market places such as Binance, Kraken or Bitfinex, which are also derivatives providers.

Illiquid supply now accounts for nearly 78% of circulating supply and tends to grow with every notable correction in the price of BTC since the bankruptcy of FTX.

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Sources – Figures 1 to 5: Glassnode

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky by nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

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AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

To go further, read our pages Financial situation, Media Transparency And Legal Notice.

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Binance launches “Capital Connect”, its platform to connect VIPs with crypto fund managers

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Binance continues to expand its services by launching its new “Capital Connect” platform for its VIP clients. This platform will allow investors to get in touch with fund managers specialized in the field of cryptocurrencies. Although the service is free, Binance hopes to benefit from it by attracting institutional liquidity to its platform.

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Binance continues to expand its services

Binance, the world’s largest cryptocurrency exchange, has just announced its latest innovation called “Capital Connect”. Intended for its VIP customers, this new platform will act as a gateway to put them in touch with fund managers specialized in the crypto ecosystem.

Individuals or companies benefiting from one of the 9 VIP levels offered by Binance will be the only ones able to access this service. Since the VIP circle is expensive, it is generally only available to high net worth individuals, hedge funds, wealth management offices or brokers, among others.

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As such, Catherine Chen, Binance VIP Service Managerrevealed in an exclusive interview with our colleagues from The Block that the platform’s VIP customers represent only a tiny fraction of the platform’s 128 million users, but that they ” contribute very significantly to the volume or activity of our various product lines “.

According to Binance’s press release, Capital Connect will be a totally free service. These are the investors who will be able to connect to fund managers after selecting them from a list specifying their fees, strategies, redemption terms and assets under management, among others.

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A totally exclusive service

According to Catherine Chen, Binance is the very first platform in the crypto ecosystem to offer such a service. Although the platform does not charge any fees, it should nevertheless benefit from them by mechanical effect, according to her:

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“Generally, these investment managers trade where? They obviously trade on the platform that offers the greatest liquidity. In the end, therefore, we have everything to gain. »

Fund managers will not have the possibility to choose the investors themselves, unlike the latter, but it will be up to them to accept the connection or not according to the profile of the investor in question. Profiles will initially be opaque, then will be revealed to each party once the connection is initiatedfor security reasons.

In addition, Binance will apply its usual Know Your Customer (KYC) standard to both parties, but will in no way intervene in the process linking these.

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According to the exchange, its number of institutional clients observed a growth of 65% in 2022. In the first quarter of this year 2023, the platform already welcomes 8.3% more institutional clients than the previous one, and the trend should continue to grow in view of this new.

👉 To go further – Ordinals: Binance NFT Marketplace Opens to Bitcoin (BTC) Network Listings

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Source : Communicated, The Block

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

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AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

To go further, read our pages Financial situation, Media Transparency And Legal Notice.

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Renault brings Web3 into the real world with its next collection of NFTs

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Renault is set to launch its second collection of non-fungible tokens (NFTs) with a pair of exclusive, limited-edition digital sneakers of 960. This new collection will offer an innovative shopping experience, within an immersive 3D showroom specially created for the occasion. Each NFT will give access to the physical counterpart of the pair of digital sneakers, which will be equipped with an NFC chip containing its digital passport, also in NFT format.

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Renault innovates for its next Web3 experience

We revealed it to you last week, Renault is about to launch its second collection of non-fungible tokens (NFT) following the enthusiasm encountered for his first “genR5” drop made in tribute to his legendary automobile model of the 70s.

Thus, Renault is repeating the operation with its Web3 community, this time with a pair of sneakers designed exclusively for this occasion. These will be available in a limited edition of 960 copies, each with its digital duplicate as well as its certificate of authenticity.

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Renault Sneaker

Preview of a Renault digital sneaker

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Sold at a price of €265 via their digital version, these pairs of sneakers using the design of different Renault 5 Turbo models will combine the real world and Web3 in a completely innovative way. So, each pair will house an NFC chip to encapsulate their digital passport, acting as a certificate of authenticity.

In addition, once the pairs are in their possession, holders of “RACING SHOE5” will be able to visualize, via the NFT digital passport held in the NFC chip, the manufacturing process of their shoes as well as their compositionthus reflecting a new way for Renault to enrich the customer experience in complete transparency.

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A unique shopping experience

Thanks to the association between the pair of physical sneakers and its digital double, the shopping experience offered by Renault aims to be innovative, and this goes as far as the possibility for buyers to view the shoes in a virtual store specially created for the occasion.

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Thus, it will be possible for users to interact with a 3D showroom offering an absolutely unique visual and sound experience thanks to an avatar. In addition, Renault will also offer holders of RACING SHOE5 to try their model remotely thanks to an augmented reality filter.

Renault showroom

Preview of Renault’s 3D showroom

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Note that NFC chips cannot be duplicated or copied, the data written to them being validated by a cryptographic signature. Scanning the chip will allow holders, beyond finding the design history, to verify the authenticity of the shoes. Furthermore, this system was designed so that a transfer of the NFT contained in the chip is possible in the event of a possible resale of their RACING SHOE5.

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As a reminder, holders of an NFT from the first collection will be able to access the sale from May 15th. The opening in preview will be accessible from May 16 and finally the public sale will be open to everyone on May 17.

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This is a sponsored and paid article. Cryptoast has done prior research on the products or services presented on this page but cannot be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

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Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

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Chiliz publicly launches its mainnet with Meria among the first validators

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A few months after the announcement, the Chiliz Chain is now publicly accessible. Chiliz’s layer-1 blockchain (CHZ) will allow developers to build applications to give new use cases to token fans. Among the first 3 validators of the Chiliz Chain, we find Meria (ex Just Mining).

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Chiliz publicly announces its mainnet

Chiliz (CHZ), the blockchain ecosystem specializing in sports and entertainment, has announced the public launch of the Chiliz Chain mainnet. This is another major new step in the development of Chiliz, which aims to revolutionize the sports and entertainment industries by bringing them into the Web3 era.

According to Alexandre Dreyfus, CEO of Chiliz, the Chiliz Chain will provide many benefits to users, including faster transaction time, lower fees and greater scalability :

“Chiliz Chain can grow to form the backbone of Web3 in sports, providing the infrastructure behind the next generation of products, experiences and services for teams, brands and their fans. »

From a technical point of view, this new blockchain is of the layer-1 type and is compatible with the Ethereum Virtual Machine (EVM). It will introduce a system of 11 validator nodes enabling Proof of Stake Authority (PoSA) consensus to work.

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For the launch, only 3 validators were selected : Jump Crypto, Paribu and Meria (formerly Just Mining). Owen Simonin (better known under the pseudonym Hasheur), CEO of Meria, testified to his enthusiasm following this major collaboration:

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

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Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

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the Senate adopts the “influencers” bill promoted by the Economic Affairs Committee

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Yesterday evening, the bill concerning influencers was adopted by the Senate. Notable reductions have been noted compared to the version previously promoted by the National Assembly: companies working in the crypto-asset sector will be able to promote their activities without necessarily holding PSAN approval, only registration will be compulsory. Soon, a joint committee between the two chambers will be formed to give rise to a common text of law.

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The Senate lightens the bill

Yesterday evening, the senators adopted at first reading the bill aimed at regulating the activity of influencers. In particular, elected officials included amendments in favor of companies registered as digital asset service providers (PSAN), thus following the position of the Economic Affairs Committee as pointed out by Adan (association for the development of digital assets):

As a reminder, part of this regulation directly targets the French cryptocurrency ecosystem : at the end of March, the deputies of the National Assembly had positioned themselves for a ban on acts of promotion through influencers to companies that do not hold PSAN approval.

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👉 Understand everything about the National Assembly’s “influencer” bill

However, a problem is pointed out: the Financial Markets Authority (AMF) is unable to provide PSAN approval to companies that engage in activities related to crypto-assets. In effect, the latter are not able to obtain professional indemnity insurancewhich is a mandatory requirement for certification.

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Thus, after hearing the voices of the various players in the sector, the Senate voted on a more flexible bill : PSAN approval is not considered mandatory, only registration will be necessary for companies carrying out promotional actions through influencers.

Shortly, discussions will be carried out by a joint committee so that the two chambers, the National Assembly and the Senate, can find a compromise on this text of the law.

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Yesterday, in the columns of Cryptoast, the actors of the French Web3 ecosystem expressed themselves on their concerns about the text promoted by the National Assemblywhile welcoming the relaxations proposed by the Senate.

👉 Read the column signed by around twenty French Web3 companies

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Source : Senate

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

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AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

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PayPal customers have invested $943 million in cryptocurrencies

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In a document filed with the SEC, we learn that PayPal has almost a billion dollars having been invested in cryptocurrencies by its customers. How is the payment giant evolving with regard to this aspect of its activity?

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PayPal manages over $1 billion worth of cryptocurrencies

In its Form 10-K filed with the Securities and Exchange Commission (SEC) and reporting its financial condition as of March 31, 2023, PayPal reveals that it manages 943 million dollars of cryptocurrencies on behalf of its customers.

Among the distribution of these assets, Bitcoin (BTC) comes out on top without much surprise, representing almost half of these assets, or 499 million dollars. ETH comes second with $362 million, and an “other” category, for Litecoin (LTC) and Bitcoin Cash (BCH), weighs in at $82 million.

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Compared to December 31, 2022, the data presented shows an increase of just over 56%. Indeed, the previous total was $604 million, broken down as follows:

  • BTC: $291 million;
  • ETH: $250 million;
  • Other: $63 million.

However, it should to put this progress into perspectivebecause it does not mean that deposits have increased by 56%.

And for good reason, over the period studied, BTC rose 72.26%, and ETH 52.5%. It would thus have been necessary to have a distribution denominated in the original assets to judge the results of PayPal between the last quarter of 2022 and the first of 2023, because it even seems that there were more withdrawals than depositsjudging by these statistics.

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In addition, PayPal specifies in the form that it only handles account maintenance for its customers’ crypto investments, and that custody of the assets is outsourced to a third party.

The said third party has not been mentioned explicitly, but, although nothing is certain, PayPal having acquired the Israeli start-up Curv in 2021, we could have a line of thought there. Indeed, the company is particularly specialized in the custody of digital assets.

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At the moment, PayPal’s cryptocurrency services are relatively limited. While it is aimed primarily at American customers, it is gradually opening up to the rest of the world, such as the United Kingdom and Luxembourg.

👉 News — Cryptocurrencies: Grayscale launches a new structure and files a registration for 3 ETFs

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Source : Form 10-K

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

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Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

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To go further, read our pages Financial situation, Media Transparency And Legal Notice.

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the French company Dfns integrates biometrics into their infrastructure

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Today, non-custodial wallets are complex to handle: recovery phrases and private keys are an obstacle to the general public’s use of these tools. Based on this observation, the startup Dfns has developed a solution to develop wallets with an atypical feature: their users will be able to use biometric tools to unlock access to their assets.

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Dfns launches its biometric solution

Will we soon be able to unlock our non-custodial wallets using facial recognition? The Parisian firm Dfns has just announced the launch of its solution enabling developers to create cryptocurrency wallets including biometric tools.

👉 What is a non-custodial wallet?

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Thus, future users will be able to access their funds and interact with their assets. using a fingerprint or facial recognition. The unlocking of the wallet by the identity of its user will then replace the role of private keys and recovery phrases.

The co-founder and CEO of the company, Clarisse Hagège, asserts that this transition from private keys to identity verification is necessary to bridge the gap between Web2 and Web3 interfaces:

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Any user creating a crypto wallet or transferring digital assets will be able to do so with a simple scan of their face or fingerprint, bridging the user experience gap between Web3 and Web2. »

Thus, cryptocurrency holders will no longer need to remember recovery phrases or private keys: only the user authorized by the biometrics tools will access their funds, all thanks to a cryptographic key created and stored on the device used.

👉 How to store your cryptocurrencies through a wallet

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For greater Web3 accessibility?

In developing its solution, the startup specializing in wallet infrastructure has one mission in mind: make cryptocurrency wallets more accessible by facilitating their use.

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After a year 2022 marked by numerous bankruptcies, in particular that of FTX causing losses amounting to several billion dollars, investors have massively turned to non-custodial wallets. Evidenced by the excellent results of the French company Ledger, having achieved a large number of sales during the bear market.

However, less tech-savvy investors are held back by the complexity of these tools. Still according to its co-founder, the objective of Dfns is therefore to offer a service that is both secure and accessible to as many people as possible:

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The first place a new user can start their Web3 journey is by opening a wallet, and if the UX feels foreign, cluttered, or unfamiliar, the likelihood of conversion and retention drops precipitously. Every platform and application that wants to help make Web3 more convenient and secure must integrate biometric wallets. »

For now, the company’s solution is available in beta version for developers. Note that in April 2022, Dfns has raised 13.5 million euros from several investment fundsincluding a company owned by the parent company of Coinbase.

👉 The Top 10 crypto wallets to secure your assets

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What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.

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Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.

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Grayscale Launches New Structure and Files Registration for 3 ETFs

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To optimally manage some of its investment products, Grayscale has announced the creation of a new structure. In addition to this, the company has filed for SEC registration for 3 new ETFs.

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Grayscale launches the Grayscale Funds Trust and expands its ETFs

On Tuesday, Grayscale announced the creation of the Grayscale Funds Trust and as a Delaware statutory trust (DST). :

Grayscale Funds Trust will thus allow the company to independently manage the activities falling under the 1940 Actan American law which notably regulates the activities of investment companies and investment advisers.

Michael Sonnenshein, CEO of Grayscale, returned to this desire to create solid foundations at the regulatory level:

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“The creation of Grayscale Funds Trust reflects our commitment to responsibly evolving Grayscale’s business. We’re putting the foundation in place so that Grayscale can continue to create and support regulated, future-ready products. »

Complementing Grayscale Funds Trust, Company Unveiled Filing for Registration with the Securities and Exchange Commission (SEC) for 3 new Exchange Traded Funds (ETFs) :

  • Grayscale Ethereum Futures ETF;
  • Grayscale Global Bitcoin Composite ETF;
  • Grayscale Privacy ETF.

For the moment, the SEC has always refused to approve ETFs on the spot trading of cryptocurrencies. However, his reaction to these new products could be different, since they are based on derivatives.

Indeed, the ETF on ETH will be built from Chicago Mercantile Exchange (CME) futures contracts, while the other 2 will follow indices from the Indxx company.

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Grayscale and crypto products

During this bear market, Grayscale is experiencing some difficultieslike its parent company Digital Currency Group (DCG), whose company Genesis had to face bankruptcy.

However, Grayscale’s difficulties lie rather in its two main investment products, namely the Grayscale® Bitcoin Trust (GBTC) and the Grayscale® Ethereum Trust (ETHE). And for good reason, both trade at a steep discount in the over-the-counter market.

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For GBTC, it is trading at $15.66, which is 37.6% less than the $25.13 it is supposed to be worth. Regarding ETHE, it is even worse, with 8.8 dollars instead of 17.99, or 51%.

Despite this depreciation relative to their benchmark, DCG itself had, despite everything, had to sell stakes in these products to help repay Genesis creditors.

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Beyond these difficulties, it will be interesting to follow the development of Grayscale, which participates at its level in bringing cryptocurrencies to the traditional finance sector.

👉 Also in the news — Regulatory Uncertainty: Jump Crypto and Jane Street Halt Cryptocurrency Trading in the United States

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Source : Press release

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