2024-10-11 09:52

The Binance executive has been detained in Nigeria since February. Binance executive Tigran Gambaryan was denied bail by a Nigerian judge, a family spokesperson said Friday. “We are deeply disappointed by the court’s decision to deny Tigran bail, particularly given his deteriorating health. He has been unlawfully detained for over 220 days," a Binance spokesperson said in statement adding that the company is committed to working with the Nigerian government. Gambaryan, the crypto exchange's head of financial crime compliance, has been detained in Nigeria since February. He has been in the notorious Kuje prison alongside the likes of terrorist group Boko Haram since fellow Binance employee Nadeem Anjarwalla escaped custody in March. Alongside Binance, Gambaryan was charged with tax evasion and money laundering, though the tax charges were later dropped. The court deferred making a decision on bail in September. Gambaryan's attorneys filed a new bail application, citing his deteriorating medical condition. One lawyer, Mark Mordi, told the court last month that the executive has needed surgery since July 18 and requires urgent assistance that cannot currently be provided in prison, Bloomberg reported. During his time in prison Gambaryan has developed malaria, pneumonia and tonsillitis and suffers from complications tied to a herniated disc in his back, which left him in need of a wheelchair – though in a video from his last court appearance, Gambaryan did not have a wheelchair, and instead had to struggle on a single crutch. "It is completely unjust to deny someone in Tigran’s condition the opportunity to seek appropriate medical help and I just pray that when he is finally released that the damage he is suffering is not permanent," Tigran's wife Yuki Gamabryan said. "I am exhausted and deeply disappointed, but I will continue fighting for my husband’s rightful freedom." Update (14:05 UTC): Adds Binance comment to second paragraph. https://www.coindesk.com/policy/2024/10/11/binance-executive-tigran-gambaryan-denied-bail-in-nigeria/

2024-10-11 09:16

Alexander Nikolas Gierczyk of California says the hedge fund he sold his FTX bankruptcy claim to isn't paying out what it promised. A former customer of FTX is suing a hedge fund he sold his bankruptcy claim to. Alexander Nikolas Gierczyk alleges Olympus Peak is reneging on paying an extra amount he says he's owed because the bankruptcy payout is more than expected. A California-based former customer of FTX is suing hedge fund Olympus Peak alleging that the firm's bankruptcy claims purchasing desk has withheld promised payments on a claim he sold to it. In documents filed with the U.S. District Court Southern District Of New York, Alexander Nikolas Gierczyk says he agreed to sell a $1.59 million FTX bankruptcy claim at a 42% discount to Olympus Peak Trade Claims Opportunities Fund with an "excess claim provision." The agreement provided that “if the Claim is ultimately allowed … in an amount that is greater than the Claim Amount, Buyer will purchase such Excess Claim Amount by paying … the Excess Claim Amount multiplied by the Purchase Rate.” Gierczyk agreed to the sale only because "the purchase agreement contained a clause that expressly gave him the right to receive additional recovery in the event his claim was paid above par through the bankruptcy proceedings," according to the filing. Gierczyk's attorneys write in the filing that the most recent FTX disclosure statement says that claims similar his are estimated to receive as much as 146% of their value in distributions. But, they allege, Olympus Peak, "made clear that they would not be fulfilling their end of the bargain.” "We disagree with your position that you have a retained any economic interest in the claim,” an Olympus Peak representative wrote to Gierczyk. "This lawsuit is entirely without merit and is based on a plain misreading of the parties’ contract,” Ariel Lavinbuk, a Partner at Kramer Levin, Olympus Peak's counsel, wrote to CoinDesk in response for a request for comment. In the early days of FTX's bankruptcy, claims were going for 13 cents on the dollar on bankruptcy marketplaces. Bloomberg reported on the case earlier. https://www.coindesk.com/policy/2024/10/11/former-ftx-customer-says-hedge-fund-reneged-on-bankruptcy-payout-deal/

2024-10-11 08:34

Ether traders display a stronger inclination to mitigate potential downside risks than bitcoin, Risk reversals show traders are more inclined to mitigate potential downside risks for ether than bitcoin. Derivative traders on decentralized exchanges see limited upside in ETH. The bearish sentiment toward ether (ETH) remains pronounced relative to bitcoin (BTC) even as DeFi enthusiast Republican candidate Donald Trump extends his lead over Democrat rival Kamala Harris in prediction markets tied to the outcome of the Nov. 5 U.S. presidential election. At press time, ether's 25-delta risk reversals for shorter and longer duration expiries were more negative than bitcoin's, according to data sources Amberdata and Deribit. That's a sign of stronger bearish sentiment toward the native token of the Ethereum blockchain, which dominates in decentralized finance (DeFi). Risk reversals measure the premium required to hold a call option relative to a put. Negative values suggest a bias for put options, which reflect expectations of a price drop in the underlying asset. Traders often use options to hedge their spot/futures market exposure. Therefore, a trader with a bullish spot/futures bet may buy a put option when expecting downside volatility. Both bitcoin and ether traders seem to be doing just that, with ether traders displaying a stronger inclination to mitigate potential downside risks. The risk reversal for Oct. 11 ether options is -7.3%, while bitcoin's is -5.8%. A similar pattern is observed for expiries up to the end of October. A curious pattern has emerged: While BTC risk reversals are positive for Nov. 8 and beyond, ether's don't turn bullish until late December. In other words, traders expect upside volatility in BTC once the election results are out on Nov. 8. Ether isn't expected to turn the corner until later. DEX traders see limited upside in ETH On the dominant decentralized exchange (DEX) Derive, Ethereum call options saw a 2.5:1 sell-to-buy ratio in September. The flow was much more balanced in bitcoin options. The relatively greater interest in writing (selling) ether calls means traders do not foresee a notable upside volatility in the cryptocurrency. "The skew in ETH open interest, with nearly 2.5 times more calls sold than bought, suggests that traders see the upside as limited for now. This divergence between the two assets will be key to watch as we get closer to election day," Nick Forster, founder of Derive, told CoinDesk in an exclusive monthly report. Trump's lead widens Trump's odds of winning the election soared to a two-month high of 55.8% on prediction platform Polymarket, leaving Harris behind at 43.8%. The popular narrative is that a potential Trump win would be positive for both BTC and DeFi. The perception likely stems from Trump's decision to debut DeFi protocol World Liberty Financial in September. On Oct. 9, the protocol submitted a proposal on Aave to link the two projects, focused on providing stablecoin liquidity for ETH and WBTC and growing Aave's user base. Still, some observers, including Standard Chartered, say a Trump victory would be better for Ethereum rival Solana, and Ethereum will prosper more under Harris' presidency. https://www.coindesk.com/markets/2024/10/11/sentiment-more-bearish-for-ether-than-bitcoin-even-as-trump-widens-leads-over-harris/

2024-10-11 04:40

Trump's odds of winning the U.S. presidential election have surged to a more than two-month high. Plus, the broader crypto market is stagnant despite hopes of another round of stimulus in China. Trump-themed PoliFi tokens outperformed a slow market this week as the Republican candidate pulled ahead of Kamala Harris on Polymarket. Crypto traders in Asia are eagerly awaiting Beijing's next moves as the People's Bank of China (PBoC) prepares to role out more stimulus. Donald Trump-themed Political Finance (PoliFi) tokens bucked low volatility in bitcoin and the broader crypto market this week as the Republican presidential candidate's chances of winning the election surged to a two-month high on Polymarket. Bitcoin slid over 4% in U.S. hours Thursday, before recovering in Asian morning hours Friday, now trading above $60K, as renewed regulatory fears plagued the market. A re-acceleration in inflation pressure in September initially sent markets lower, with majors such as ether (ETH) and dogecoin (DOGE) falling as much as 6%. But Trump-themed MAGA, MAGA HAT, and the Solana-based TREMP are all up double digits this week, with MAGA, the first and largest of them, up 55% on-week with a market cap moving past $200 million, while MAGA HAT is up $102% while TREMP is up 93%. PoliFi is a cohort of tokens and memecoins that gained traction earlier this year, allowing communities and traders to speculate on the rise or fall of political figures using markets. Trump's odds of winning the U.S. presidential election have surged to a more than two-month high on the leading prediction market, Polymarket. As of Friday, traders are giving the former president a 55.8% shot versus Vice President Kamala Harris' 43.8%, according to pricing on Polymarket, where more than $1.6 billion has been wagered on the November election. However, some market watchers await broader economic data before placing larger bets. “A rebound in Trump's election odds has failed to elevate sentiment higher, and the market could be focused on how much of the income release of the FTX creditor claims will be reinvested back into crypto,” shared Augustine Fan, head of insights at SOFA, in a Telegram message to CoinDesk. Elsewhere in crypto, Uniswap's native token (UNI) is up 10% as the market responds positively to the decentralized exchange (DEX) rolling out its own Layer-2 network built on optimism. Meanwhile, the CoinDesk 20 (CD20), an index tracking the performance of the largest digital assets, has been flat, up only 0.5%. Renewed China Stimulus Hopes Traders might wait to see how far the Chinese government goes with stimulus measures before making moves. Bloomberg reported that market participants in China expect $283 billion (2 trillion yuan) in fresh fiscal stimulus as early as this weekend. Elsewhere in China, the PBoC has begun to roll out a $70.6 billion fund called the Securities, Funds, and Insurance Companies Swap Facility, Caixin reported, which will allow financial institutions to pledge bonds, ETFs, and specific stock holdings to the PBoC in exchange for liquid assets like government bonds, which they can use to secure additional financing for stock purchases as a form of market stabilization. However, does any of this matter for crypto investors eager to see BTC hit an all-time high? Maybe not. A paper from BCA Research suggests that while China’s recent major stimulus has sparked rallies in stocks and risk assets like bitcoin, CoinDesk reported earlier, it may not have lasting effects, as the new credit flow, or "credit impulse," is too low to drive a strong economic boost similar to past cycles like in 2015. https://www.coindesk.com/markets/2024/10/11/trump-themed-polifi-tokens-buck-bitcoin-downtrend-as-china-stimulus-hopes-return/

2024-10-10 21:08

His odds of winning the U.S. presidential election have soared to a more than two-month high. Donald Trump's odds of winning the U.S. presidential election have surged to a more than two-month high on the leading prediction market, Polymarket. Traders are giving the former president a 55.8% shot versus Vice President Kamala Harris' 43.8%, according to pricing on Polymarket, where more than $1.6 billion has been wagered on the November election. Trump's chances have risen to levels last seen days after President Joe Biden said he wouldn't seek reelection, clearing the way for his vice president to take over. Another prediction market, Kalshi, which just recently won permission to list contracts based on U.S. elections, also shows Trump in the lead over Harris: 52% to 48%. PredictIt, meanwhile, shows a slimmer Trump lead: 53% to 52%. Polymarket is not technically available to Americans, though VPN users likely sidestep that restriction. Kalshi and PredictIt are allowed in the U.S., however. https://www.coindesk.com/markets/2024/10/10/trumps-lead-over-harris-widens-on-polymarkets-prediction-market/

2024-10-10 19:47

ETH ETFs haven't gained the same traction as BTC ETFs, even seeing net outflows this week. Tom Carreras investigates why. Spot ether ETFs have failed to attract the same kind of demand as spot bitcoin ETFs. But that was a tall order, considering how immensely popular the bitcoin products have been. Headwinds include the lack of staking yield in the ETFs and a difficulty in marketing Ethereum to investors. For many investors, the performance of spot ether (ETH) exchange-traded funds (ETFs) has been disappointing. Whereas spot bitcoin (BTC) ETFs processed almost $19 billion in inflows in the course of 10 months, ether ETFs, which began trading in July, have failed to produce the same kind of interest. Even worse, Grayscale’s ETHE, which existed as an ether Trust prior to its conversion into an ETF, has suffered massive redemptions, and demand for other ether funds has failed to offset them. That means ether ETFs have, so far, experienced $556 million in net outflows since they launched. Just this week, the products have bled out a net $8 million, according to Farside data. So why are ether ETFs performing so differently? There are a few possible reasons. Putting inflows into context First of all, it’s important to note that ether ETFs only look bad in contrast to bitcoin ETFs. The bitcoin products have broken so many records that they’re arguably the most successful ETFs of all time. For example, the ETFs issued by BlackRock and Fidelity, IBIT and FBTC, collected $4.2 billion and $3.5 billion each in their first 30 days, smashing the previous record, held by BlackRock’s Climate Conscious fund, which had garnered $2.2 billion in its first month, August 2023. While ether ETFs failed to replicate these kinds of earth-shattering results, three of the funds are still among the top 25 best performing ETFs of the year, according to ETF Store president Nate Geraci. BlackRock’s ETHE, Fidelity’s FBTC, and Bitwise’s ETHW have vacuumed up almost $1 billion, $367 million, and $239 million in assets respectively – not bad at all for two-and-a-half months old funds. “Spot ether ETFs were never going to challenge spot bitcoin ETFs in terms of inflows,” Geraci told CoinDesk. “If you look at the underlying spot markets, ether is about one-fourth the market cap of bitcoin. That should be a reasonable proxy of where spot ether ETF demand ends up longer-term relative to spot bitcoin ETFs.” The problem is that Grayscale’s ETHE has drowned out these funds’ performances with its large outflows. Spun up in 2017 as a trust, ETHE was originally designed, for regulatory reasons, in a way that didn’t permit investors to redeem their ETF shares – the money was stuck in the product. That changed on July 23, when Grayscale won approval to convert its trust into a proper ETF. At the time of conversion, Grayscale held roughly $10 billion in ether, and while some of those assets were moved by Grayscale from ETHE to another of its funds – the ether mini ETF – ETHE has suffered almost $3 billion in outflows. It’s worth noting that Grayscale experienced the same thing with its bitcoin ETF, GBTC, which has processed more than $20 billion in outflows since its conversion in January. However, the stellar performances of BlackRock and Fidelity’s spot Bitcoin ETFs have more than offset GBTC’s bleedout. Lack of staking yield One of the big differences between bitcoin and ether is that investors can stake ether – essentially locking it into the Ethereum network to earn a yield paid out in ether. However, in their current form, ether ETFs don’t allow investors to gain exposure to staking. So holding ether through an ETF means missing out on that yield (currently about 3.5%) – and paying a management fee to issuers that can range from 0.15% to 2.5%. While some traditional investors won’t mind giving up that yield in exchange for the convenience and safety of an ETF, it makes sense for crypto-natives to find alternative ways of holding ether. “If you're a competent fund manager with even a basic understanding of the crypto market and you're managing someone’s money, why would you buy an ether ETF right now?” Adam Morgan McCarthy, an analyst at crypto data firm Kaiko Research, told CoinDesk. “You pay to get exposure to ETH (and the underlying is custodied at Coinbase) or you buy the underlying yourself and stake it with the exact same provider in return for some yield,” McCarthy said. Marketing Ethereum to clients Another obstacle for ether ETFs is that it can be hard for some investors to understand the core use-case for Ethereum because it seeks to lead in several, diverse areas of crypto. Bitcoin was created with a hard cap on supply: There will never be more than 21 million bitcoin in existence. That makes it relatively easy for investors to see it as “digital gold” and a potential hedge against inflation. Explaining why a decentralized, open-source smart contract platform matters – and more importantly, why ether stands to accrue in value – is another task altogether. “One of the challenges for ether ETFs in penetrating the 60/40 Boomer world is distilling its purpose/value into an easy-to-understand soundbite,” Bloomberg Intelligence ETF analyst Eric Balchunas wrote in May. McCarthy agreed. “Ether is just that bit more complex to get across to people – it’s not built for an elevator pitch,” he told CoinDesk. It’s no wonder, then, that crypto index fund Bitwise recently launched an educational ad campaign highlighting the technological benefits of Ethereum. “As investors learn more about stablecoins, decentralized finance, tokenization, prediction markets, and the many other applications powered by Ethereum, they will enthusiastically embrace both technology and the US-listed Ethereum ETPs,” Zach Pandl, head of research at Grayscale, told CoinDesk. Poor price performance There’s also the fact that ETH itself hasn’t performed all that well compared to BTC this year. The second largest cryptocurrency by market capitalization is only up 4% since Jan. 1, whereas BTC has risen 42% and keeps hovering around its 2021 all-time highs. “One factor contributing to the success of the bitcoin ETFs, which remain mostly retail-driven, has been investor animal spirits and fear of missing out, which itself was fueled by BTC’s 65% rise into the ETF launch and subsequent 33% gain since,” Brian Rudick, director of research at crypto trading firm GSR, told CoinDesk. “ETH’s 30% price decline since its ETFs launched has put a large damper on retail enthusiasm to buy the funds,” Rudick added. “Sentiment around Ethereum is low, with some seeing it as stuck between Bitcoin as the best monetary asset and Solana as the best high-performance smart contract blockchain.” Unattractive valuation Finally, there’s a possibility that traditional investors simply don’t find ether’s valuation attractive at these levels. At a market capitalization of roughly $290 billion, ether already has a higher valuation than any bank in the world except for JPMorgan Chase and Bank of America, which stand at $608 billion and $311 billion respectively. And while that might seem like an apples-to-oranges comparison, Quinn Thompson, founder of crypto hedge fund Lekker Capital, told CoinDesk that ether’s valuation also looks high compared to tech stocks. Ether’s valuation “next to other assets is now uglier because there is no justification for its price on any sort of valuation framework,” Thompson wrote in September. “Either price has to come down, or a new generally accepted valuation framework for the asset needs to be widely accepted.” Correction (Oct. 11, 2024, 14:10 UTC): Corrects ETHE pre-ETF AUM to $10B. https://www.coindesk.com/markets/2024/10/10/four-reasons-ether-etfs-have-underperformed/