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.
PAYPAL LAUNCHES CRYPTO SERVICE: PayPal (PYPL) announced Wednesday the launched a new service enabling its customers to buy, hold and sell cryptocurrency directly from their PayPal account, and signaled its plans to significantly increase cryptocurrency's utility by making it available as a funding source for purchases at its 26Mmerchants worldwide. The company is introducing the ability to buy, hold and sell select cryptocurrencies, initially featuring Bitcoin, Ethereum, Bitcoin Cash and Litecoin, directly within the PayPal digital wallet. The service will be available to PayPal accountholders in the U.S. in the coming weeks. The company plans to expand the features to Venmo and select international markets in the first half of 2021. The service is enabled in the U.S. through a partnership with Paxos Trust Company, a regulated provider of cryptocurrency products and services. PayPal has also been granted a first-of-its-kind conditional Bitlicense by the New York State Department of Financial Services. Additionally, Bloomberg’s Ed Hammond and Katie Roof reported Thursday that the company is looking into takeovers of cryptocurrency companies including Bitcoin custodian BitGo. The payments giant has been holding discussions with BitGo and could reach an agreement within weeks. According to PitchBook, BitGo raised $58.5M in 2018 at a $170M valuation.
RIPPLE MULLS RELOCATION: Ripple Labs is eyeing Japan and Singapore as countries it could possibly move to if it departs the U.S. due to lack of regulatory clarity, Bloomberg’s Takashi Nakamichi and Takako Taniguchi reported Wednesday, citing CEO Brad Garlinghouse. Other potential destinations include Switzerland, the UK and the United Arab Emirates. “The common denominator between all of them is that their governments had created a clarity about how they would regulate different digital assets, different cryptocurrencies,” he said. “Regulation shouldn’t be a guessing game. Ripple is definitely a proud U.S. company and we’d like to stay in the U.S. if that was possible, but we also need regulatory clarity in order for us to invest and grow the business.”
OKEX TRADERS CAN CASH OUT AT A COST: Institutional users of cryptocurrency exchange OKEx can now get their holding out but at a price, Bloomberg’s Olga Kharif reported Thursday. The exchange, which suspended withdrawals last week amid a Chinese police investigation, started enabling users to trade with each other on Wednesday. Following the start, Zulu Republic, Alameda Research and Whalepool created a way for institutional investors to sell their OKEx deposits for a token representing bitcoin or tether on the Ethereum blockchain. The user is charged a 1% fee on the swap plus a fee for a regulatory check and receives one token for every OKEx bitcoin deposited into the venture’s OKEx account.
MARATHON APPOINTS CFO: Marathon Patent Group (MARA) announced Tuesday the appointment of Simeon Salzman to the position of CFO. Simeon will report to Chairman and CEO, Merrick Okamoto, while overseeing all financial activities, including audits, acquisitions, finance, and tax and accounting. Simeon succeeds former CFO, David Lieberman, who will continue to serve on the company’s Board of Directors. Prior to joining Marathon, Salzman served as the CFO and SVP of the Las Vegas Monorail Company, a private non-profit entity from 2018 to 2020.
JONES SAYS BITCOIN RALLY IN “FIRST INNING”: Billionaire investor Paul Tudor Jones has become more bullish on bitcoin, saying the cryptocurrency is the best inflation hedge, CNBC’s Yun Li reported Thursday. “I like bitcoin even more now than I did then. I think we are in the first inning of bitcoin and it’s got a long way to go,” Jones said, adding he holds a “small single-digit investment” in the cryptocurrency. The hedge fund manager said the unprecedented quantitative easing from the Federal Reserve is setting the stage for inflation to make a grand comeback. “The reason I recommended bitcoin is because it was one of the menu of inflation trades, like gold, like TIPS breakevens, like copper, like being long yield curve and I came to the conclusion that bitcoin was going to be the best inflation trade,” Jones said. “Bitcoin has this enormous contingence of really, really smart and sophisticated people who believe in it. It’s like investing with Steve Jobs and Apple (AAPL) or investing in Google (GOOG, GOOGL) early.”
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 (RIOT), Pareteum (TEUM) and Social Reality (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 rose roughly 14.5% this week at $12,994 in U.S. dollars, according to TradeBlock.
Srax
+ (+0.00%)
Pareteum
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Riot Platforms
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Ideanomics
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OSTK
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Nvidia
+0.67 (+0.13%)
AMD
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Alphabet
-0.74 (-0.05%)
Alphabet
+1.09 (+0.07%)
Apple
-0.07 (-0.06%)
Marathon Digital
+0.01 (+0.33%)
PayPal
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Bitcoin
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Bitcoin
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