CoinDesk Crypto

Hut 8 (HUT) has purchased $30 million of Nvidia’s new crypto mining-specific graphics processing units (GPU) to help the company expand into mining for other cryptocurrencies besides bitcoin.

Called a Cryptocurrency Mining Processor (CMP), the new GPU was launched earlier this year to target professional cryptocurrency miners. Nvidia introduced the GPU, in part, to steer those miners away from its other GPUs following complaints by the company’s core gaming customers frustrated by shortages caused by miner demand.

In the company’s Q4 earnings call, Nvidia CEO Colette Kress said she expected about $50 million in total CMP sales during the new product’s first quarter this year, per CoinDesk’s prior reporting. Hut 8 filled 60% of that target in one order.

Related: $6B in Bitcoin Options Are Set to Expire Friday. Here’s What You Need to Know.

The machines “open up new opportunities” for Hut 8’s plans for diversified revenue streams, said CEO Jamie Leverton in a statement. The new CMPs will add roughly 1,600 GH of power to the firm’s mining capacity, which it will use to mine alternate blockchains. Hut 8 expects full delivery and deployment of the CMPs this summer.

Allocating mining capacity to alternate blockchains like Ethereum “has been rewarded handsomely by public market investors as seen by the stock price of Hive compared to [its] Canadian-traded counterparts who have focused on Bitcoin to date,” said Ethan Vera, co-founder of Seattle-based mining company Luxor Technology, in a direct message with CoinDesk. Now Hut 8 wants some of the profit.

Shares of the Toronto-based company have gained 130% year to date to just above $7. Bitcoin has climbed 77% over the same period.

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Bitcoin rose for the first time in three days as traders looked past Friday’s record $6 billion expiration of option contracts to a stronger market next week as April begins.

“Returns after prior bitcoin options expiration dates have tended to be positive,” David Grider, strategist at Fundstrat, told clients in an email. “The market is calm based on bitcoin VIX [a volatility index] falling, with room to fall further.”

BTC was changing hands at roughly $52,700 as of 12:03 UTC (8:04 a.m. ET), up 2.9% on the day.

• An oversold signal on Thursday preceded in a near 8% rise in bitcoin (see chart). The next level of resistance is around $55,000-$56,000 which could limit upside moves.
• Previous oversold signals on the hourly relative strength index (RSI) resulted in 5%-8% price recoveries. However, sellers have been active at key resistance levels this month.
• Bitcoin’s uptrend continues to weaken after breaking below trend support on the four-hour chart.
• The hourly chart remains in a downtrend defined by lower price highs as traders continue to take profit from intraday recoveries.
• So far, buyers are defending support around $50,000. Additional selling pressure could stabilize around lower support at $42,000.

Related: $6B in Bitcoin Options Are Set to Expire Friday. Here’s What You Need to Know.

On the fundamental side, uncertainty over vaccine rollouts across Europe, renewed lockdowns, and the underperformance of Asian equities casted a shadow over risk assets this month.

Elsewhere in the cryptocurrency universe, lending markets are heating up after BlockFi cut rates. “There is simply too much BTC supply in search of yield relative to institutional demand for that BTC,” wrote Matthew Ballensweig, head of lending at Genesis Trading, in a March 24 tweet. “There are limited ways to deploy BTC right now, and thus the glorified 4%-6% yields on BTC are contracting fast.”

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U.K.-listed Argo Blockchain (LON: ARB) said it has signed a memorandum of understanding with blockchain and cryptocurrency technology firm DMG Blockchain Solutions to launch a bitcoin mining pool completely powered by clean energy.

• Under terms of the agreement, the two firms will jointly launch “Terra Pool,” a bitcoin mining pool exclusively powered by clean energy.
• Terra Pool will initially consist of both Argo’s and DMG’s hashrate, which is mostly generated by hydroelectric resources. It will provide a platform for cryptocurrency miners to produce bitcoin and other cryptocurrencies in a sustainable way, the firms said.
• The agreement comes amid rising criticism for the energy used by the crypto mining industry and its potential impact on climate change.
• “Addressing climate change is a priority for Argo and partnering with DMG to create the first ‘green’ bitcoin mining pool is an important step towards protecting our planet now and for generations to come,” said Peter Wall, CEO of Argo Blockchain.

Read more: Argo Blockchain Takes 25% Stake in $40M Crypto VC Fund

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New Zealand Funds Management Ltd. (NZ Funds)’s KiwiSaver growth fund has invested 5% of its money in bitcoin, according to a report by local news outlet Stuff.

The KiwiSaver Growth Strategy Fund, which had NZ$350 million (US$244 million) in assets at the end of December, began investing in cryptocurrency in October, according to a company product disclosure document.

The fund’s chief investment officer, James Grigor, told the outlet he expects competitors to follow suit over the next five years. “If you are happy to invest in gold, you can’t really discount bitcoin.”

Related: $6B in Bitcoin Options Are Set to Expire Friday. Here’s What You Need to Know.

The fund falls under the auspices of the national KiwiSaver program founded by the New Zealand Labour party in 2007. The retirement savings scheme is similar to a 401(k) in the U.S. and Superannuation in Australia, which allows access to a user’s savings only after he or she reaches a certain age.

The fund manager’s move represents a drop in the bucket, compared with the $66.5 billion (US$46.3 billion) market for assets currently under management by providers throughout the nation, according to data from Morningstar.

See also: Morgan Stanley Sees Cryptocurrencies on Path to Investable Asset Class

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The reluctance of many institutions to have exposure to China is going to a problem for mass investment in bitcoin as most of the cryptocurrency is mined in there, said Kevin O’Leary, co-host of the TV show Shark Tank.

• Speaking at the Cboe Global Markets webinar, O’Leary said that for bitcoin to really take off with institutions, it needs to be acceptable to ethics and sustainability committees.
• “It needs to be compliant,” said O’Leary, who is also chairman of O’Leary Fund Management. “That’s going to be a problem going forward.”
• O’Leary said institutions are going to be asking themselves: “Is this coin manufactured in countries that are abusing human rights or have sanctions against them? I’m really speaking now of China. I have had many institutions tell me they do not want to own ‘China coin’,” he said.
• O’Leary said he spends “a fair amount” of his time trying to deal with miners that are willing to mine compliantly, both on his own behalf and for institutions.
• The firms are “really interested in owning a coin that have some kind of provenance to them.”

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The reluctance of many institutions to have exposure to China is going to a problem for mass investment in bitcoin as most of the cryptocurrency is mined in there, said Kevin O’Leary, co-host of the TV show Shark Tank.

• Speaking at the Cboe Global Markets webinar, O’Leary said that for bitcoin to really take off with institutions, it needs to be acceptable to ethics and sustainability committees.
• “It needs to be compliant,” said O’Leary, who is also chairman of O’Leary Fund Management. “That’s going to be a problem going forward.”
• O’Leary said institutions are going to be asking themselves: “Is this coin manufactured in countries that are abusing human rights or have sanctions against them? I’m really speaking now of China. I have had many institutions tell me they do not want to own ‘China coin’,” he said.
• O’Leary said he spends “a fair amount” of his time trying to deal with miners that are willing to mine compliantly, both on his own behalf and for institutions.
• The firms are “really interested in owning a coin that have some kind of provenance to them.”

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Major cryptocurrency exchange Binance on Thursday tapped two former members of the Financial Action Task Force (FATF) for its advisory team, telegraphing its commitment to staunching compliance and fraud concerns.

• Former Executive Secretary Rick McDonell and former head of FATF’s Canadian delegation Josée Nadeau will advise on Binance’s “global compliance and regulatory strategies,” according to a press release.
• The pair will also participate in Binance’s communication with regulatory agencies around the world, according to the company. Earlier this month Binance added a top government liaison in former U.S. Senator Maxwell Baucus.
• Binance has faced past accusations of working to sidestep government oversight and is reportedly under investigation by the U.S. federal commodities regulator to see if U.S. residents traded derivatives on the cryptocurrency exchange in violation of U.S. rules allegations the firm denies.

Read more: Coinbase Calls Out Binance as It Bemoans Compliance Burden

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Tesla is not making it attractive to pay for a model S, 3, X or Y in BTC.

This week, CEO Elon Musk announced via Twitter (where else?) that his upstart automaker had begun letting interested buyers pay for their electric vehicles in bitcoin. It’s part of a corporate push to acquire as much of the original cryptocurrency as possible – or at least that’s how it seems – as the manufacturer has no plans to convert the cryptocurrency to fiat. 

But the idiosyncrasies of crypto make it difficult to take advantage of this option. For example, according to the company’s Bitcoin Payment Terms and Conditions, bitcoin transactions must be completed within a certain window of time, or else the price in BTC expires and the buyer must ask for a new one. 

Related: Shark Tank’s O’Leary Says a Made in China Label on Bitcoin Keeps Some Funds Away

“You have about 30 minutes to make a payment,” a Tesla representative for the northeast region said Thursday.

While that condition is not surprising given bitcoin’s infamous volatility – depending which direction the exchange rate moves, either the car buyer or Tesla could get hosed by a wide swing – it underscores how even in a roaring bull market, crypto still struggles to gain widespread acceptance as a payment method. 

The fault lies with the native complexities of the Bitcoin system, the U.S. tax policy around cryptocurrencies and, in this case, a paucity of information available from Tesla’s customer support team. At least, if you’re a member of the press looking for answers.

Tesla is notoriously media-shy, after disbanding its PR department late last year. So after calling headquarters in Palo Alto and getting bounced around, and then separately emailing CFO Zach Kirkhorn and the black-hole address for press inquiries, this reporter phoned a number of Tesla retailers based in the northeast and along the West Coast … and learned very little about purchasing a vehicle with bitcoin. 

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“It’s very simple. If they ask about purchasing it, we can assist them with making an appointment,” the northeast Tesla representative said, unhelpfully. To be fair, a New Jersey resident who is actually in the market for a vehicle said she called a Tesla branch and got all her questions answered. 

She told CoinDesk that the Paramus-Route 17 gallery accepts bitcoin – though was told flat-out there was no early-adopter’s discount. 

But we were able to glean a few telling insights, including the 30-minute payment window.

Another is that Tesla will only accept exact amounts and will not reimburse payments sent to an incorrect alphanumeric address. 

In fact, bolded passage punctuate the company’s Bitcoin Payment Terms & Conditions document with warning including:

“IF YOU INPUT THE BITCOIN ADDRESS INCORRECTLY, YOUR BITCOIN MAY BE IRRETRIEVABLY LOST OR DESTROYED.” 

And… 

“YOU MUST EXERCISE CARE WHEN INPUTTING THE BITCOIN ADDRESS INTO THE RECIPIENT FIELD BECAUSE BITCOIN TRANSACTIONS CANNOT BE REVERSED. WE ARE NOT RESPONSIBLE FOR ANY FAILURE TO ACCURATELY INPUT THE ALPHANUMERIC CODE INTO THE RECIPIENT FIELD.”

That document says nothing about tax liabilities, though this is another consideration for U.S. buyers. Under current policy, a purchase of goods or services made with cryptocurrency is a taxable event – even if it’s just a cup of coffee. 

This means that car buyers must account for potential gains or losses if their bitcoin is worth more or less now than when they first purchased it. 

Finally, there are the deflationary incentives in the Bitcoin ecosystem that may discourage potential buyers from spending their coins on cars, or anything. A hard cap of 21 million coins, a decreasing rate of issuance and a growing number of buyers create favorable conditions for the price of BTC to rise over the years, all else equal.

While Lamborghinis have long been the objet petit a for many Bitcoiners, those that have made the purchase – or any purchase – often come to regret it. In 2013, someone purchased a $103,000 Tesla Model S Performance for 91.4 BTC. Those coins today would be worth $4.7 million.

Asked whether there has been any interest from HODLers since Musk tweeted this week, the Tesla representative said, “Not quite sure if anything sold yet in bitcoin.”

But another employee sounded excited: “I don’t really know that much, and don’t want to take on the liability of speaking to the press, to be frank. It’s great news,” this Tesla representative said.

Lawrence Lewitinn contributed reporting

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• Bitcoin (BTC) trading around $52,184.38 as of 20:00 UTC (4 p.m. ET). Slipping 4.77% over the previous 24 hours.
• Bitcoin’s 24-hour range: $50,458.10-$54,762.75 (CoinDesk 20)
• BTC trades between its 10-hour and 50-hour averages on the hourly chart, a sideways signal for market technicians.

Bitcoin traders urged caution as prices for the cryptocurrency slid toward $50,000 for the first time in two weeks while the options market braced for volatility ahead of a record $6 billion contract expiration Friday.   

“This is a time to make sure that you have some dry powder and are not overextended,” Chad Steinglass, head of trading at CrossTower, said in an emailed comment. “It seems as though buyers are stepping back, and instead of buying the dip are simply waiting on the sidelines to see what happens.”

Read More: Bitcoin Traders Brace for Record $6B in Options to Expire Friday

Related: Shark Tank’s O’Leary Says a Made in China Label on Bitcoin Keeps Some Funds Away

The largest cryptocurrency was unchanged to slightly lower Thursday, at around $52,100 as of 19:19 UTC (3:19 p.m. ET). Earlier, prices slid as low as $50,360. Bitcoin hasn’t traded below $50,000 since March 8, well off its all-time high above $61,000.

U.S. stocks were barely higher Thursday, churning below record highs, while Asian and European markets were lower. Some of that weakness could be hampering risk-taking spirits among bitcoin traders. 

The U.S. dollar has strengthened recently to new highs in foreign exchange markets. Bitcoin is negatively correlated with the greenback, which means they often trade in opposite directions. 

There’s also the monthly expiration looming Friday in the bitcoin options market. Analysts have warned the “max pain” point – where buyers have the most to lose and sellers the most to gain – would occur if the price plunged to around $44,000. The risk is considered remote but plausible. 

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“We’re currently looking for support in the range between $50,000 and $48,000,” Hunain Naseer, senior editor at OKEx Insights, told CoinDesk. “Any concrete signs of recovery are likely to show up after the options expiry on Friday.”

In the meantime, CoinDesk reported Thursday that blockchain data might be turning more bullish: An unusually large number of bitcoins are being withdrawn from cryptocurrency exchanges and going to an illiquid status – possibly an indication they’re being taken down by long-term holders who are unlikely to sell their tokens anytime soon.

Read More: Long-Term Holders Keep Accumulating Bitcoin Amid Latest Sell-Off: Blockchain Data

“Support only holds as long as there are a multitude of large buyers willing to step in if prices decline,” Steinglass said. “We’ll all have to wait and see.”

Ether (ETH) was down on Thursday, trading around $1,605.95 and slipping 1.86% in 24 hours as of 20:00 UTC (4:00 p.m. ET).

A key support level to watch is in the range of $1,500 and $1,600, according to OKEx Insights’ Naseer. If that support fails, a deeper sell-off could ensue.

Ether “has been unable to bounce back in the absence of a strong signal from bitcoin,” he said.

A key factor that analysts are dissecting in the ether market is the role of dollar-pegged stablecoins in the fast-growing digital economy, much of which is centered on the Ethereum blockchain.

Read more: Ethereum’s Transition Could Be Months, Not Years, Away

According to Messari research analyst Ryan Watkins, Ethereum is at risk of becoming “dollarized” because of the prevalence of stablecoins including tether (USDT) and USD coin (USDC).

“Ethereum has dollarized, and the dollar is ultimately controlled by the Federal Reserve, clouding dreams of an independent monetary system,” he wrote.

The market has taken notice, and one solution might be so-called non-pegged stablecoins. By sacrificing a “fixed exchange rate,” one of three points in a triangular currency model known as “the impossible trinity,”  a new type of stablecoin might be able to achieve an independent monetary policy.

Watkins explained the concept in this tweet thread.

Digital assets on the CoinDesk 20 are mostly in red Thursday. The notable winner as of 20:00 UTC (4:00 p.m. ET):

• chainlink (LINK) + 1.36%

Notable losers: 

• eos (EOS) – 10.31%
• kyber network (KNC) – 9.69%
• omg network (OMG) – 9.25%
• 0x (ZRX) – 9.11%
• ethereum classic (ETC) – 8.92%
• orchid (OXT) – 8.37%
• tezos (XTZ) – 7.31%

Equities: 

• Asia’s Nikkei 225 closed up 1.14%.
• The FTSE 100 in Europe closed down 0.57%.
• The S&P 500 in the United States closed 0.52% higher.

Commodities:

• Oil was down 4.46%. Price per barrel of West Texas Intermediate crude: $58.45.
• Gold was in the red 0.43% and at $1,726.63 as of press time.

Treasurys:

• The 10-year U.S. Treasury bond yield climbed Thursday to 1.628%.

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Crypto bank Avanti raised $37 million from Series A investors as it prepares to take its digital banking operations online.

In a press release, parent company Avanti Financial Group said Coinbase Ventures, Binance.US, Morgan Creek Digital, Slow Ventures and the University of Wyoming Foundation, among others, participated in the funding round. Avanti has raised $44 million total, the group said.

Avanti said it will put the funds toward meeting regulatory capital requirements and further invest in its engineering team. It gained special-purpose depository institution (SPDI) status in October, joining fellow Wyoming-based crypto firm Kraken as one of the few digital companies with the banking charter.

Related: Shark Tank’s O’Leary Says a Made in China Label on Bitcoin Keeps Some Funds Away

At the time, CEO Caitlin Long told CoinDesk that Avanti needed to raise more capital before it could receive a certificate of authority to operate. 

Avanti is preparing to launch later this year, Long said in the press release.

“A lot of people and crypto-native companies of all stripes, exchanges, traders, lenders, banks and also a number of non-crypto companies have also actively reached out to us because they understand [CTO] Bryan Bishop and his team have different capabilities” than traditional banks, Long said in an interview.

Avanti’s final pre-launch task will be getting clearance to bank with the Federal Reserve, Long said.

Related: Your NFT Tax Questions, Answered

“Plugging crypto directly into the us dollar payment system, that has never been done before,” she added.

“Many look at our statutory requirement of $5 million, but I can tell you it is actually far in excess of that,” Wyoming Division of Banking Commissioner Albert Forkner told CoinDesk via email. “The level that Avanti announced is consistent with our expectations and other applicants.”

Update (March 25, 20:50 UTC): Add comments from Avanti’s Caitlin Long.

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Alchemy, the backbone of a large portion of the $42 billion decentralized finance (DeFi) realm, is partnering with Flow, the blockchain built by the team behind NBA Top Shot, 2021’s leading foray into the explosive world of non-fungible tokens (NFT).

CryptoKitties creator Dapper Labs began working with Alchemy a few years back. So the partnership announced Thursday will provide the same support for Flow, the home of NBA Top Shot. The latter accounts for more transactions than all the other NFT projects combined, according to Dapper Labs CEO Roham Gharegozlou.

Alchemy, a kind of Amazon Web Services (AWS) for powering blockchains, also provides developers with the “picks and shovels” to easily build more user-friendly services. This typically means tools to debug their code, increase performance and allow better transparency.

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“When you open Uber or Netflix or Airbnb, that infrastructure is powered by AWS underneath the hood. And alchemy does the same for accessing blockchains,” Alchemy CEO Nikil Viswanathan said in an interview.

Flow has distinguished itself with five specialized node types that perform specific roles within the ecosystem across “collection,” “execution,” “consensus,” “verification” and “access.” The firm claims that using its system rather than sharding brings the network better speed and data throughput.

“Flow can achieve this very high scale and great user experience with very low gas fees, but without Alchemy you’d have to build everything yourself,” said Gharegozlou. “These developer tools are helping Flow go from a blockchain that has half a dozen applications to one that can have thousands or tens of thousands in a matter of months.”

A handful of systemically important firms have emerged to provide connective tissue across the burgeoning Ethereum ecosystem, which include Alchemy and its opposite number, ConsenSys-owned Infura. Other essential furniture for DeFi and proof-of-stake investing include ConsenSys-owned MetaMask and Coinbase-owned Bison Trails. 

Related: Caitlin Long’s Avanti Raises $37M Ahead of Crypto Bank Launch

These beefed-up infrastructure offerings ensure blockchain users have a smooth ride accessing services and can enjoy 100% uptime, but such concentration could potentially be a single point of failure.

“I think at one point Infura was very dominant,” Gharegozlou said. “Now that there’s Alchemy there are a few different options and things are a little less specialized on Ethereum.”

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Effect Network, a decentralized finance (DeFi) platform that connects companies to the global workforce, will be switching its development from the EOS blockchain to the Binance Smart Chain (BSC).

Effect Network developers said Thursday the main reason for the shift to BSC, a smart contract-based blockchain backed by exchange giant Binance, is due to concerns about the future of the EOS blockchain and its leadership.

In January, serial blockchain entrepreneur and EOS CTO Dan Larimer left Block.one “to pursue new personal projects.”

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Effect Network cites “unfulfilled promises to address the many issues that plague the EOS mainnet” prior to Larimer’s departure as motivating factors for its search for greener pastures. The team claims its network, which purports to be building the “decentralized Future of Work,” is the “most-used and largest project” on the EOS mainnet to date, with clients including Kraft Heinz, Linus Tech Tips and the United Nations. The team cautions that with Effect’s departure this may well mean “the end of applications with real use cases on the EOS chain.”

Effect Network CEO Chris Dawe explained the move to BSC is due to his confidence in the long-term vision of the Binance ecosystem. 

“Look at what the Binance organization has accomplished in only the last three years. It is a testament of dedication, hard work but above all its laser-focused vision. The amount of products and services our clients and workforce can tap into with the Binance ecosystem are amazing and will help accelerate the growth of the Effect Network like never before,” said Dawe.

BSC has taken on a number of DeFi projects from the Ethereum ecosystem, such as SushiSwap and 1Inch, since it went live in September.

Related: Caitlin Long’s Avanti Raises $37M Ahead of Crypto Bank Launch

Read more: Controversial Dapps Test Binance Smart Chain’s Decentralization

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Cryptocurrency exchanges aren’t seeing a much anticipated surge in bitcoin (BTC) purchases by retail customers using the $1,400 stimulus checks they received from the U.S. government as part of President Joe Biden’s $1.9 trillion coronavirus relief bill.

The news might come as a disappointment to bitcoin bulls who speculated the latest round of “stimmy checks” might push up bitcoin prices past $60,000 or beyond. The cryptocurrency is down 11% this week after slipping 2.8% last week. It is changing hands at press time around $51,300.

The checks are still being distributed, so it might be too early to call the hyped-up episode a dud. But that’s what it looks like so far. The Japanese brokerage firm Mizuho relied on a survey to estimate earlier this month that some $40 billion of the latest round of direct stimulus checks could be spent on bitcoin and stocks.

Related: Market Wrap: Bitcoin Slips to $52K; All Eyes on Friday’s $6B Options Expiry

Read more: Nearly $40B in US Stimulus Checks May Be Spent on Bitcoin and Stocks: Mizuho Survey

“While it is too early to comment on the amount of money coming to our platform from the recent stimulus, we’d note that during the previous stimulus fundings, we saw significant deposits with like amounts to the individual stimulus checks,” Steve Ehrlich, CEO of Voyager, a U.S. cryptocurrency exchange, told CoinDesk in an email sent by a spokesperson.

An earlier round of stimulus resulted in a spike in deposits that were exactly the same amount as the $1,200 stimulus check at the time, according to an April 2020 tweet by Brian Armstrong, CEO of Coinbase, the largest cryptocurrency exchange in the U.S.

The tweet has since been deleted, and Coinbase declined to comment on the latest round of stimulus due to the regulatory “quiet period” leading up to its public market debut. Fortunately, the tweet was preserved as a screenshot:

Related: Caitlin Long’s Avanti Raises $37M Ahead of Crypto Bank Launch

So the question is: Why aren’t the exchanges seeing the flow?

It could be that retail traders are taking a pause after bidding up high-flying tech stocks and cryptocurrencies over the past few months. Trading volumes in call options of stocks favored by members of Reddit’s WallStreetBets forum are down, according to Bloomberg.

The retail trader retreat could also be driven by macro-economic factors. Consumers are more comfortable with spending cash as the U.S. economy recovers from a pandemic-induced recession. Credit card spending among millennials spiked over the past month, according to data from JPMorgan. And that cash hasn’t made its way to cryptocurrency exchanges.

It’s also possible that bitcoin’s doubling in prices has made the cryptocurrency look more expensive to prospective buyers.

There’s still a chance a bitcoin-buying bonanza could materialize: The U.S. Internal Revenue Service expects the next batch of stimulus payments to be issued this week.

But so far? Not much to report.

Kraken, a U.S. based cryptocurrency exchange, also told CoinDesk it hasn’t seen a significant uptick in $1,400 purchases.

“Many customers are adjusting their sell targets higher,” wrote Kraken.

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The director of the Digital Currency Research Institute at the People’s Bank of China (PBoC) is proposing a set of global rules for monitoring central bank digital currencies (CBDCs).

• Speaking at the Bank for International Settlements (BIS) seminar on Thursday, Mu Changchun laid out the proposals, explaining that CBDC fund flows should be “synchronized” to help regulators “monitor the transactions for compliance,” according to a Reuters report.
• “Interoperability should be enabled between CBDC systems of different jurisdictions,” he said.
• China is leading major nations in the development and piloting of a CBDC but the digital yuan project has raised concerns around the amount of insight it would give authorities into users’ financial data and behavior.
• The PBoC has shared its proposals with other central banks and monetary authorities, Mu said at the BIS seminar.

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The press release writers at the U.S. government’s General Service Administration (GSA) are gushing about “cryptocurrency spring fever.” It might not be a coincidence that the agency plans to sell more than $300,000 worth of bitcoin at an auction next week.

According to an announcement posted Wednesday on the agency’s website, the GSA is offering commission-free bidding on 6.79 BTC, divided into 10 lots. On Thursday, bitcoin was changing hands around $50,800, so the total amount set for auction works out to roughly $345,000. The auction will take place on the GSA Auctions website, starting on March 29 at 5 p.m. ET.

“Get ready for cryptocurrency spring fever on GSA Auctions,” according to the press release. “It’s time to let your bitcoin portfolio bloom by placing a winning bid during GSA Auctions’ upcoming cryptocurrency sale.”

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The auction comes just weeks after the GSA conducted its first auction of bitcoin – a chunk of 0.7501 BTC that went for $53,104.

• While the federal government has been auctioning bitcoin since 2014, this will be the second time cryptocurrency is being sold using GSA Auctions.
• The previous auction took place on March 17 with 31 bidders. The winning bid was at $53,104 at 0.7501 BTC. That works out to $70,796 for a full bitcoin – more than 20% over the market price of about $59,000 on March 17. So it wasn’t exactly a bargain. But the government apparently got a good price.
• “Our first steps wading into the cryptocurrency market quickly became one of our hottest auctions of 2021, but it was really just a test run for our latest bitcoin auction,” Thomas Meiron, regional commissioner for GSA’s Federal Acquisition Service, said in the press release.
• “We expect this auction will generate even more excitement among cryptocurrency investors,” Meiron said.
• According to the press release, GSA Auctions is a service of the U.S. General Service Administration that serves as the government’s online clearinghouse for federally owned assets and equipment such as office furniture, vehicles, scientific equipment and collectibles.

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A radical new framework for how to authenticate online identities just went live on the Bitcoin network.

Microsoft’s Decentralized Identity team has launched the ION Decentralized Identifier (DID) network on the Bitcoin mainnet. This network is a layer 2 technology similar to Lightning except that instead of focusing on payments it uses Bitcoin’s blockchain to create digital IDs for authenticating identity online.

An ID network like ION could be the key to unlocking a web where users no longer have to fumble with passwords, emails and cell phones for verification.

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“We are excited to share that [version 1] of ION is complete and has been launched on Bitcoin mainnet. We have deployed an ION node to our production infrastructure and are working together with other companies and organizations to do so as well. ION does not rely on centralized entities, trusted validators or special protocol tokens. ION answers to no one but you, the community,” Microsoft’s Daniel Bucnher writes in a blog post. 

As noted by Buchner, ION is open source, so anyone can download the code and run an ION node to use the service. It uses Sidetree, an open-source protocol for decentralized identifiers built by devs from Microsoft, ConsenSys, Mattr and Transmute. 

Open to the public after being in closed beta since June 2020, ION uses the same logic as Bitcoin’s transaction layers to sign off on identity. A public key and its associated private key are used to verify that a user owns an ID.

For example, to log into your email or social media in a world that uses ION, you would verify you own your account by “signing” your DID with your ION account. Thanks to the cryptographic links that ION creates to Bitcoin, the ION network would verify for the service provider that you own the ID associated with your account. 

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Any personal data (name, age, etc) tied to that ID is stored off-chain, depending on the service. ION’s IDs are anchored to Bitcoin’s blockchain using the InterPlanetary File System (IPFS) protocol, and ION nodes can process up to 10,000 ID requests in a single transaction.

Users can create and manage multiple IDs with different keys for different services. Some of these may be used recurrently to log into services that users access daily including email and social media, or could be used in one-off ways such as verifying concert or event tickets. 

Anyone interested in running ION can do so through a remote node or by downloading it directly on a native device.

Microsoft has developed an application programming interface (API) for developers who would like to interact with the service without downloading a node or wallet. The company has also built an explorer for looking up DIDs created on the network.

With version 1 launched, the team will focus on releasing a “light client” for bootstrapping nodes faster and streamlining ID resolution by authorizing an ID while its related transaction is still in Bitcoin’s mempool. 

Microsoft’s ION has attracted contributions from Bitcoin and crypto mainstays including Casa, ConsenSys, Gemini, BitPay and Protocol Labs, as well as a hand from the teams at Cloudflare, Spruce and others. 

ION has also worked with the Transmute and SecureKey teams who are building their own DID networks.

Decentralized Identity is a good example of a non-monetary use case for public blockchains like Bitcoin, and it’s even on the radar of the World Economic Forum’s blockchain chief. The World Wide Web Consortium (W3C), a body for web standards founded in 1994), is currently evaluating DIDs as a candidate recommendation, meaning the forum is considering recognizing these identity frameworks as an international standard.

Blockchain Commons head and crypto veteran Christopher Allen told CoinDesk in 2019 that Microsoft embracing Bitcoin’s properties for DIDs is “a step in the right direction.”

“You could have a service that is in the cloud hosted by Microsoft Azure, but is absolutely secure because everything in it is encrypted with your keys that you control and everything that run under your authority, even though it’s in the cloud,” Allen said.

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Bitcoin buyers may have bought the recent price dip and now are taking down their cryptocurrency from exchanges, blockchain data suggests. To digital-market analysts, it’s a bullish signal traders or investors might be preparing to hold their BTC for the long term.

• More than 1,365 BTCs were removed from cryptocurrency exchanges during the 24 hours through 12:00 UTC Thursday, the highest for a 24-hour period so far this year, according to the blockchain data firm Glassnode.
• The spike in withdrawals from exchange addresses came as the No. 1 cryptocurrency by market capitalization slumped on Thursday to near $50,000, from a high at $56,783.86 in the past 24 hours.
• “Today we have a new all-time high in BTC leaving the exchanges for 2021 and a new dip-buying prize to award,” bitcoin analyst Willy Woo tweeted Thursday.

• At the same time, more coins are being withdrawn to an illiquid status, separate blockchain data show.
• The monthly net change of supply held by liquid and highly liquid entities have pushed into deeply negative levels, to a degree not seen in three years, according to Glassnode. (See chart above.)
• That might be related to many investors’ growing use of bitcoin as a hedge against inflation in the face of trillions of dollars of monetary stimulus pumped into global financial markets over the past year by central banks around the world.
• “The trend of coins withdrawn and locked away into long-term holding patterns is a direct response to the world’s central bank response to 2020,” Glassnode wrote in its newsletter earlier this month. “There still appears to be significant demand from long-term investors.”
• At press time, bitcoin is changing hands at $51,278.06, down 9.49% in the past 24 hours.

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Bitcoin buyers may have bought the recent price dip and now are taking down their cryptocurrency from exchanges, blockchain data suggests. To digital-market analysts, it’s a bullish signal traders or investors might be preparing to hold their BTC for the long term.

• More than 1,365 BTCs were removed from cryptocurrency exchanges during the 24 hours through 12:00 UTC Thursday, the highest for a 24-hour period so far this year, according to the blockchain data firm Glassnode.
• The spike in withdrawals from exchange addresses came as the No. 1 cryptocurrency by market capitalization slumped on Thursday to near $50,000, from a high at $56,783.86 in the past 24 hours.
• “Today we have a new all-time high in BTC leaving the exchanges for 2021 and a new dip-buying prize to award,” bitcoin analyst Willy Woo tweeted Thursday.

• At the same time, more coins are being withdrawn to an illiquid status, separate blockchain data show.
• The monthly net change of supply held by liquid and highly liquid entities have pushed into deeply negative levels, to a degree not seen in three years, according to Glassnode. (See chart above.)
• That might be related to many investors’ growing use of bitcoin as a hedge against inflation in the face of trillions of dollars of monetary stimulus pumped into global financial markets over the past year by central banks around the world.
• “The trend of coins withdrawn and locked away into long-term holding patterns is a direct response to the world’s central bank response to 2020,” Glassnode wrote in its newsletter earlier this month. “There still appears to be significant demand from long-term investors.”
• At press time, bitcoin is changing hands at $51,278.06, down 9.49% in the past 24 hours.

• The Fed Chair and the Treasury Secretary Come Out Against Privacy-Respecting Anonymous Digital Dollar
• The Beginnings of Institutional Ethereum: Recapping the First Few Weeks of CME Ether Futures
• Crypto Must Apply Safety Lessons of the Existing Financial System
• US Government Sees ‘Cryptocurrency Spring Fever’ as Great Time to Auction Bitcoin