Riding The Wave News Summary 147
Tether Says It Will Buy Bitcoin for Stablecoin Reserves Using Realized Profits, Bankrupt Crypto Lender Celsius Transfers $75M of Ether to Staking Service Figment, & more
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News
Table of Contents
Tweets
Tether Says It Will Buy Bitcoin for Stablecoin Reserves Using Realized Profits
Bankrupt Crypto Lender Celsius Transfers $75M of Ether to Staking Service Figment
Crypto firm Ripple buys Swiss startup as SEC crackdown forces companies to consider overseas moves
U.S. Rep. Lori Chavez-DeRemer Hands Over Campaign Contribution From Failed Crypto Firm FTX
Tweets
https://twitter.com/GameofTrades_/status/1658880057111367681
https://twitter.com/therationalroot/status/1658851148814589957
https://twitter.com/GameofTrades_/status/1658502576470634497
https://twitter.com/GameofTrades_/status/1658472384960299009
https://twitter.com/WatcherGuru/status/1658482682463162369
https://twitter.com/WallStreetSilv/status/1658438554853445635
https://twitter.com/WhaleChart/status/1658374375274434561
https://twitter.com/WatcherGuru/status/1658316359191674882
https://twitter.com/WhaleChart/status/1658262208659312640
https://twitter.com/NorthmanTrader/status/1658198638055546881
https://twitter.com/GameofTrades_/status/1658109990962429961
https://twitter.com/GameofTrades_/status/1658155284488151040
https://twitter.com/GameofTrades_/status/1658125097293561860
https://twitter.com/callieabost/status/1657918781711155200
Tether Says It Will Buy Bitcoin for Stablecoin Reserves Using Realized Profits
Stablecoin issuer Tether will regularly buy bitcoin (BTC) for its stablecoin reserves using a portion of its profits starting this month as part of a new investment strategy focused on the largest cryptocurrency by market capitalization, the firm announced on Wednesday.
Tether said it will allocate up to about 15% of the realized profits from investments – excluding any unrealized price appreciation of its reserve assets – to purchase BTC and will add the tokens to the reserve surplus.
The company will custody the BTC stash on its own, without using any third-party custodians, according to the statement.
The development comes after Tether, the company behind the largest stablecoin on the market, the $82 billion USDT, revealed last week that it holds $1.5 billion of BTC and $3.4 billion of gold among the assets that backs the value of USDT and its smaller stablecoins. Some 85% of the reserves are held in cash and cash-like assets such as U.S. Treasury bonds, according to its 2023 Q1 attestation.
The company said it will exclusively utilize realized profits from its investment operations for buying BTC, disregarding unrealized capital gains. It means that the firm considers “only the tangible gains from its operations,” consisting of the difference between the purchase price and net proceeds from an asset sale or, in case of maturing assets such as Treasury bills, between the purchase price and the reimbursed amount, per the statement.
For years, Tether has been criticized within the crypto industry for its lack of transparency about its reserves and controversial investment decisions.
However, the firm’s flagship token USDT emerged as a safe haven in March as the U.S. regional banking crisis hit Circle’s USDC, the second largest stablecoin. The sudden implosion of Silicon Valley Bank (SVB) left a part of USDC’s cash reserves frozen at the bank over a weekend, and several stablecoins lost their dollar peg temporarily in a knock-on effect.
Tether came out of the calamity as a clear winner by maintaining its price stability due to its perceived disconnection from U.S-based banks, being incorporated in the British Virgin Islands and Hong Kong. USDT’s circulation has grown 24% this year while most rivals have suffered significant outflows.
Bankrupt Crypto Lender Celsius Transfers $75M of Ether to Staking Service Figment
Beleaguered cryptocurrency lender Celsius Network staked some $75 million of ether (ETH) last week via Figment, an institutional-grade staking service, blockchain data shows.
According to data by crypto intelligence firm Arkham Intelligence, Celsius – via fourteen transactions between May 10 and May 12 – transferred some 40,928 ETH to an aggregation smart contract labeled as Figment ETH2 Beacon Depositor 1 by blockchain explorer Etherscan. It then forwarded to Ethereum's proof-of-stake Beacon chain's deposit contract.
Figment is a non-custodial service, meaning that Celsius still holds the keys to deposited digital assets, a company representative said in an email.
The manuever represents one of the largest movements of funds for the crypto lender since it filed for Chapter 11 bankruptcy protection in July.
Depositing to a staking service allows Celsius to earn rewards on its digital asset holdings during the restructuring efforts. According to Figment's website, Ethereum staking offers an average of 5.6% annualized staking reward.
Crypto firm Ripple buys Swiss startup as SEC crackdown forces companies to consider overseas moves
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