BlackRock to make bitcoin futures eligible investment for two funds a Coinbase to acquire Bison Trails
As bitcoin, ethereum and other cryptocurrencies get increasing attention from investors, Wall Street and its traditional banks continue to adjust to the shift. Catch up on this week's top stories highlighting the intersection of these old guard and new school areas of finance with this recap compiled by The Fly.
BLACKROCK TO MAKE BITCOIN FUTURES ELIGIBLE INVESTMENT: BlackRock (BLK) intends to add bitcoin futures as an eligible investment to two funds, Reuters' David Randall reported Wednesday. The asset manager said it could use derivatives of the cryptocurrency for its funds BlackRock Strategic Income Opportunities and BlackRock Global Allocation Fund. BlackRock noted that the funds will only invest in cash-settled bitcoin futures traded on exchanges registered with the CFTC.
COINBASE TO ACQUIRE BISON TRAILS: Coinbase (COIN) announced Tuesday that it will acquire blockchain infrastructure platform Bison Trails. The company said, “Coinbase is committed to providing best-in-class infrastructure to empower current and future builders of the cryptoeconomy…It’s for this reason and many more that Coinbase is proud to announce that we are acquiring Bison Trails, an early pioneer in fully managed blockchain infrastructure whose platform has helped to accelerate the adoption of blockchain technology around the world. Its easy-to-use platform powers billions of transactions for many of the biggest names in crypto today. By joining forces, we aim to bring the advanced technology that the Bison Trails team has developed — and continues to develop — to more projects and more companies around the world. Bison Trails will continue to operate as a standalone product and provide world class services to its current customers, which include some of the most respected names in crypto and financial technology…This acquisition is subject to customary closing conditions and is expected to close later this year.”
YELLEN SAYS CRYPTO USED FOR ILLEGAL FINANCING: Joe Biden's nominee for treasury secretary, Janet Yellen, expressed concern over the illicit uses of cryptocurrencies like aiding in the financing of terrorism, Business Insider’s Harry Robertson reported Wednesday. Yellen suggested regulators “curtail” the use of digital currencies such as bitcoin as they are “mainly” used for illegal activities. "We need to make sure that our methods for dealing with these matters, with terrorist financing, change along with changing technology," Yellen said. "Cryptocurrencies are a particular concern. I think many are used - at least in a transaction sense - mainly for illicit financing. And I think we really need to examine ways in which we can curtail their use and make sure that money laundering doesn't occur through those channels."
CLEANSPARK GENERATES OVER 56 BITCOINS: CleanSpark (CLSK) provided an update on Wednesday of the number of bitcoins mined by its wholly-owned subsidiary, ATL Data Center. In the first 40 days since the acquisition of the mining operation, the company has generated just over 56 Bitcoins as of end of business, January 19, 2021. The company had previously stated its plan to strategically manage the percentage of the coins it holds or sells according to market conditions and current bitcoin prices. To date, CleanSpark continues to hold approximately 31 of the 56 bitcoins it has mined. As the company observes a September 30 fiscal year end, the mining revenue thus far in FY21 has exceeded $1.6M based on the daily price of bitcoin on the date they were mined. The company also announced Thursday that it has become aware of a report "making false accusations against CleanSpark and its officers." The company said, "The publisher of this false report is an unknown entity or group hidden behind the facade of 'Culper Research,' which disguises the identity of the actual author. The apparent purpose of the Culper Research 'report' is to cover or profit from the publisher's short positions in the company, which the publisher expressly acknowledges holding in the report itself…CleanSpark takes seriously any accusations of impropriety, stands behind its prior statements and disclosures, and will not tolerate unfounded and reckless claims against the company.”
RIOT BLOCKCHAIN EXPANDS S19 PRO ANTMINER FLEET: Riot Blockchain (RIOT) announced Tuesday the receipt and deployment of 2,500 Bitmain S19 Pro Antminers as part of the purchase agreement disclosed in October 2020. Installation is expected to be completed over the next week. Once the S19 Pro Antminers are fully deployed, Riot will have a total of 9,540 Antminers in operation with a hash rate capacity reaching an estimated 842 petahash, representing a nearly 50% increase in operational hash rate capacity. Riot has an additional 28,100 S19 and S19j Pro Antminers on order that are scheduled for shipment on a monthly basis through October 2021. Once fully deployed, the company estimates it will have a total of 37,640 Bitmain Antminers in operation with an estimated aggregate bitcoin mining hash rate capacity of 3.8 Exahash.
CRYPTO STOCK PLAYS: Cryptocurrency revenues have been pointed to as reasons to be bullish on Advanced Micro Devices (AMD) and Nvidia (NVDA) in select research. Overstock (OSTK), Ideanomics (IDEX), Riot Blockchain, Pareteum (TEUM) and SRAX (SRAX) are other stocks that have been touted, or promoted themselves, as a way to play the crypto theme.
PRICE ACTION: As of time of writing, bitcoin dropped roughly 12% this week at $32,465 in U.S. dollars, according to TradeBlock.