1. Home
  2. Funding


KuCoin leads $10M funding for Chinese yuan stablecoin issuer

Circle’s investment arm has joined a funding round for CNHC, the issuer of the eponymous stablecoin pegged to the offshore yuan.

The investment arm of major cryptocurrency exchange KuCoin is moving to support new stablecoin initiatives by backing a Chinese yuan-pegged stablecoin issuer.

KuCoin Ventures has led a $10 million investment into stablecoin issuer and blockchain-based payment service provider known as CNHC.

Announcing the news on March 16, KuCoin Ventures said that the funding round included some prominent industry investors, including KuCoin’s investor IDG Capital and Circle Ventures, the investment arm of the USD Coin (USDC) issuer, Circle.

KuCoin chief investment officer and KuCoin Ventures lead Justin Chou told Cointelegraph that the new investment in CNHC is the first time for KuCoin Ventures to invest in a stablecoin-related project.

“KuCoin is always interested in building a stronger infrastructure for the financial system,” Chou said, adding that the world is likely to see more real world asset-backed stablecoins in the near future. He added:

“To ensure stability of the financial market, stablecoin designers need to find a balance between overcollateralization and efficiency. We are happy to see more algorithm-based stablecoins but they need to prove their resiliency."

The investment​​ into CNHC reflects KuCoin Ventures' strategy of backing the Web3 infrastructure in the Asia-Pacific region, Chou said. According to the announcement, KuCoin Ventures also invested $10 million in China’s blockchain project Conflux in early 2022. Chou noted that Hong Kong has a well-established traditional finance ecosystem and has a “real opportunity at becoming the new crypto center of the world” with new regulations and policy for digital assets.

CNHC co-founder Joy Cham told Cointelegraph that the platform launched its offshore yuan-pegged stablecoin CNHC about two years ago. He described the stablecoin as a “more akin to a house settlement tool” referring to CNHC’s limited exposure. According to data from CoinMarketCap, the CNHC stablecoin is only listed on one centralized exchange, TruBit Pro Exchange.

“It will be listed in more centralized and decentralized exchanges in the near future,” Cham added.

The exec also noted that CNHC currently supports settlement service in other major stablecoins, including Tether (USDT) and USD Coin (USDC). Cham also noted that the firm has had some impact due to the recent banking crisis involving Silicon Valley Bank and Silvergate. “Some of the banks are our partners that help us to settle USD, but there’s other banking partners so service is still ongoing,” Cham said.

Related: Do Kwon had the right idea, banks are risk to fiat-backed stablecoins — CZ

On the other hand, KuCoin has had no impact due to those issues as it has no exposure to SVB, Silvergate or Signature Bank, KuCoin CEO Johnny Lyu told Cointelegraph.

“However, the whole market is exposed at varying degrees to USDC and USDT,” Lyu said, adding that removal of crypto from traditional banking could cause “long-lasting implications on the industry.” The CEO stated:

"Bitcoin was born after ‘Lehman Brothers’ yet still grew to mass adoption with about 420 million global users. The recent shutdowns of financial institutions may be the opportunity for crypto to reach mass adoption.”

The news comes amid KuCoin facing a lawsuit in the United States due to alleged violations of offering crypto trading services in New York. In a complaint filed on March 9, New York state Attorney General Letitia James argued that KuCoin violated securities law due to offering to sell and purchase cryptocurrencies that are “commodities and securities” without registration.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Moody’s Downgrades US Banking Sector to Negative After Collapse of Three Major Banks

Moody’s Downgrades US Banking Sector to Negative After Collapse of Three Major BanksAfter the failure of three major U.S. banks last week, with two of them being the second and third largest banking failures in the country, Moody’s Investors Service has downgraded the rating of the U.S. banking system from “stable” to “negative.” As one of the “Big Three” credit rating firms, Moody’s cited a “rapid deterioration […]

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

South Korea launches Metaverse Fund to expedite domestic initiatives

With the help of the Metaverse Fund, South Korea will support the mergers and acquisitions of various firms from the metaverse ecosystem.

While some global economies got distracted by the commotion around price instability and ecosystem collapses in crypto, South Korea doubled down on the potential of the metaverse as a new economic growth engine.

South Korea’s Ministry of Science and ICT announced investments into a fund dedicated to driving metaverse initiatives in the country. According to the official announcement, the South Korean government invested roughly $18.1 million (24 billion Korean won) with the goal of creating a fund of more than 40 billion Korean won (approximately $30.2 million) toward metaverse development.

With the help of the Metaverse Fund, South Korea will support the mergers and acquisitions of various firms from the metaverse ecosystem. The government sufficed this move by highlighting the rising interest of major tech companies in Metaverse.

Related: South Korea to examine crypto staking services following the Kraken case

The government agrees that considering the underlying investment risks, it is difficult for local players to raise capital through private investments. As a result, in addition to mergers and acquisitions, South Korea intends to help domestic metaverse-related companies compete with global players, adding that “we plan to actively support it.”

Metaverse Seoul screenshots. Source: opengov.seoul.go.kr

In January, the city of Seoul launched a digital replica of the city in the metaverse. As Cointelegraph reported, the South Korean government spent roughly 2 billion won — $1.6 million — for the first phase of the metaverse project.

However, in the physical world, South Korea continues to keep checks and balances on cross-border threats. In February, the country announced its first independent sanctions related to cryptocurrency thefts and cyberattacks against specific North Korean groups and individuals.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Crypto funding shifts from CeFi to DeFi after major collapses: Finance Redefined

The majority of the DeFi tokens in the top 100 traded in the red on the weekly charts due to a downturn in the broader financial market.

Welcome to Finance Redefined, your weekly dose of essential decentralized finance (DeFi) insights — a newsletter crafted to bring you significant developments over the last week.

DeFi has become a prominent choice for investors after multiple centralized finance (CeFi) collapses throughout 2022. Some key interest areas for investors include “NFTfi,” on-chain derivative platforms, decentralized stablecoins and Ethereum layer 2’s.

February saw seven DeFi exploits resulting in a net loss of about $21 million. March is no different, with multiple exploits already recorded, such as on Hedera’s mainnet. DeFi lender Tender.fi was exploited, but the white hat hacker that drained $1.59 million returned the funds.

Tornado Cash developers said that a new version of the mixing tool would aim to be more regulator friendly, where law enforcement can differentiate between the legal and illegal transfer of funds.

The DeFi market had a bearish past week, with most of the tokens in the top 100 trading in the red thanks to the new federal budget and Fed rate hike.

Crypto funding shifting from CeFi to DeFi after major collapses: CoinGecko

Digital asset investment firms poured $2.7 billion into decentralized finance projects in 2022 — up 190% from 2021 — while investments into centralized finance projects went the other way — falling 73% to $4.3 billion in the same timeframe. The staggering rise in DeFi funding came despite overall crypto funding figures falling from $31.92 billion in 2021 to $18.25 billion in 2022.

According to a March 1 report from CoinGecko, citing data from DefiLlama, the figures “potentially point to DeFi as the new high growth area for the crypto industry.” The report says the decrease in funding toward CeFi could point to the sector “reaching a degree of saturation.”

Continue reading

7 DeFi protocol hacks in Feb, with $21 million in funds stolen: DefiLlama

Reentrancy, price oracle attacks and exploits across seven protocols caused the DeFi space to bleed at least $21 million in crypto in February.

According to DeFi data analytics platform DefiLlama, one of the largest in the month was the flash loan reentrancy attack on Platypus Finance, resulting in $8.5 million of lost funds.

Continue reading

DeFi lender Tender.fi suffers exploit — White hat hacker returns funds

An ethical hacker drained $1.59 million from the DeFi lending platform Tender.fi, leading the service to halt borrowing while it attempts to recoup its assets.

Web3-focused smart contract auditor CertiK, and blockchain analyst Lookonchain, flagged an exploit that saw funds drained from the DeFi lending protocol on March 7. Tender.fi confirmed the incident on Twitter, citing “an unusual amount of borrows” through the protocol.

Continue reading

Hedera confirms exploit on the mainnet led to the theft of service tokens

Hedera, the company behind distributed ledger technology, Hedera Hashgraph, has confirmed a smart contract exploit on the Hedera mainnet, which led to the theft of several liquidity pool tokens.

Hedera said the attacker targeted liquidity pool tokens on decentralized exchanges (DEXs) that derived their code from Uniswap v2 on Ethereum, ported over for use on the Hedera token service.

Continue reading

Tornado Cash dev says ‘sequel’ to crypto mixer aims to be regulator-friendly

A former Tornado Cash developer claims to be building a new crypto mixing service to solve a “critical flaw” of the sanctioned crypto mixer, hoping to convince United States regulators to reconsider its position on privacy mixers.

The code of a new Ethereum-based mixer, “Privacy Pools,” was launched on GitHub on March 5 by its creator, Ameen Soleimani.

In a 22-part Twitter thread, Soleimani explained that the “critical flaw” with Tornado Cash is that users cannot prove they’re not associated with North Korea’s Lazarus Group or any criminal enterprise.

Continue reading

DeFi market overview

Analytical data reveals that DeFi’s total market value dipped below $45 billion this past week. Data from Cointelegraph Markets Pro and TradingView shows that DeFi’s top 100 tokens by market capitalization had a bearish week, with most of the tokens trading in red, barring a few.

Thanks for reading our summary of this week’s most impactful DeFi developments. Join us next Friday for more stories, insights and education in this dynamically advancing space.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Transform Ventures launches holding company for blockchain with $100M AUM

Transform Ventures was founded by Michael Terpin, a crypto investor who previously sued a New York teenager for $71.4 million in damages for allegedly snatching cryptocurrency from his phone.

Transform Ventures has co-invested in a new holding company in what it states is an effort to accelerate blockchain investment and innovation. Alpha Transform Holdings (ATH) aims to support the blockchain ecosystem through investments via two new funds.

ATH was created by merging select assets from Transform Ventures and Alpha Sigma Capital’s parent company, which will include two funds amounting to $100 million in assets under management.

According to an announcement shared with Cointelegraph, the new assets include majority ownership in Content Syndicate, a Transform Ventures-backed content services company. Moreover, the investments will fund the creation of two funds: the Alpha Liquid digital asset fund and the Aegean Fund.

Transform Ventures was founded by Michael Terpin, a crypto investor who previously sued a New York teenager for $71.4 million in damages for allegedly snatching cryptocurrency from his phone. For ATH, Terpin invested $2.65 million in cash, Bitcoin (BTC) and Ether (ETH), with an option to invest an additional $2.9 million.

Speaking about the development, Enzo Villani, Alpha Transform Holding’s CEO and chief investment officer, stated:

“The ATH vision is to shepherd in a new era of financial and technological innovation leveraging decentralization, blockchain technology and Web3 infrastructure.”

The new holding company’s three focus areas include delivering suites of products under asset management, Alpha Transform products and Alpha Transform strategies.

Related: How are crypto launchpads revolutionizing the DeFi industry?

While major investors and venture capitalists continue to pour millions of dollars into blockchain innovation, some investors have started showing negative sentiment, leading to increased outflows.

Weekly crypto asset inflow and outflow data. Source: CoinShares

As Cointelegraph reported, based on CoinShares’ findings, “overall volumes across investment products were low at US$844m for the week,” with Bitcoin market volumes 15% lower than usual, averaging $57 billion.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Web3 app Kresus raises $25M to bridge consumers to blockchain

Kresus’ SuperApp aims to bridge more everyday consumers to digital goods, NFTs and other Web3 products and services.

Web3 app developer Kresus has closed a $25 million funding round to support the development of its so-called SuperApp, potentially opening the door to broader consumer adoption of digital assets. 

The Series A funding round was led by Liberty City Ventures, with additional participation from JetBlue Ventures, Craft Ventures, Franklin Templeton, Marc Benioff and Cameron and Tyler Winklevoss. Kresus said the capital would go toward product development and hiring.

Kresus is currently developing SuperApp, a Web3 platform that enables crypto users to buy and sell digital goods such as nonfungible tokens, access financial services and create a universal identification for their internet activity.

The company said its forthcoming app would help users bridge the gap to Web3 — a vague concept that refers to some future iteration of the internet powered by blockchain technology.

While Web3 as a concept remains underdeveloped, startups promising to deliver the first wave of Web3 products and services have attracted sizable investments from venture capital. According to Cointelegraph Research, Web3 was the focus of 182 venture funding deals in the fourth quarter. There were 616 individual Web3 deals in 2022 totaling $9.2 billion — only blockchain infrastructure projects garnered more interest in terms of funding.

Related: Deal Box launches $125M blockchain and Web3 venture fund

The latest high-profile Web3 partnership involved Google Cloud, which announced in February that it would become a validator for the Tezos blockchain. Google Cloud’s head Web3 engineer said that the Google subsidiary is working to provide “secure and reliable infrastructure for Web3 founders and developers to innovate and scale their applications.”

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Russia-Ukraine war: How both sides of the conflict have used crypto to win

While tens of millions worth of crypto were donated to Ukraine in the last year, pro-Kremlin groups have also leveraged digital currencies to buy military supplies and spread propaganda.

In the Russia-Ukraine war, both sides of the conflict have been leveraging cryptocurrencies to achieve the upper hand. 

Pro-Ukraine causes have collected around $200 million from crypto donations, showing how borderless and uncensorable money could be useful in time of emergency. 

But the Russian side has taken advantage of crypto too: a total of about $5 million was raised by pro-Kremlin groups and propaganda outlets in the course of the invasion, as revealed by a recent Chainalysis report. These entities are small grassroot organizations that have used crypto to bypass western financial sanctions. 

“We're really looking at individual actors. So somebody who's on the front, somebody who's trying to help provide more military resources to the front [...] things like bulletproof vests or drones,” explained Andrew Fierman, head of Sanctions Strategy at Chainalysis and one of the authors of the report.

But those numbers don’t take into account ransomware attacks: As shown in Chainalysis data, in the course of 2022, over $450 million were paid to these entities, the majority of which were believed to be based in Russia. Some of them, like the cybercriminal group Conti, have openly supported the Russian government in its war effort.

“When it comes to ransomware payments, a lot of the time bad actors have some sort of political agendas behind what they're doing,” Fierman pointed out.

To find out more about the impact of crypto in the Ukrainian conflict and how Russia leveraged it to promote its cause, check out the full interview on our YouTube channel and don’t forget to subscribe!

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Total crypto market cap takes a hit amid Silvergate Bank crisis

The total crypto market cap slipped below $1.025 trillion as concerns over Silvergate Bank’s solvency triggered a sharp sell-off in BTC, ETH and altcoins.

Cryptocurrency markets experienced a relatively calm month in February as the total market capitalization gained 4% in the period. However, the fear of regulatory pressure appears to be having an impact on volatility in March.

Bulls will undoubtedly miss the technical pattern that has been guiding the total crypto market capitalization upward for the past 48 days. Unfortunately, not all trends last forever, and the 6.3% price correction on March 2 was enough to break below the ascending channel support level.

Total crypto market cap in USD, 12-hour. Source: TradingView

As displayed above, the ascending channel initiated in mid-January saw its $1.025-trillion market cap floor ruptured after Silvergate Bank, a major player in crypto on- and off-ramping, saw its stock plunge by 57.7% at the New York Stock Exchange on March 2. Silvergate announced “additional losses” and suboptimal capitalization, potentially triggering a bank run that could lead to the situation spiraling out of control.

Silvergate provides financial infrastructure services to some of the world’s largest cryptocurrency exchanges, institutional investors and mining companies. Consequently, clients were incentivized to seek alternative solutions or sell their positions to reduce exposure in the crypto sector.

On March 2, the bankrupt cryptocurrency exchange FTX revealed a “massive shortfall” in its digital asset and fiat currency holdings, contrary to the previous estimate that $5 billion could be recovered in cash and liquid crypto positions. On Feb. 28, former FTX engineering director Nishad Singh pleaded guilty to charges of wire fraud along with wire and commodities fraud conspiracy.

With billions worth of customer funds missing from the exchange and its United States-based arm, FTX US, there is less than $700 million in liquid assets. In total, FTX recorded an $8.6 billion deficit across all wallets and accounts, while FTX US recorded a deficit of $116 million.

The 4% weekly decline in total market capitalization since Feb. 24 was driven by the 4.5% loss from Bitcoin (BTC) and Ether’s (ETH) 4.8% price decline. As expected, there were merely six out of the top 80 cryptocurrencies with positive performances in the past seven days.

Weekly winners and losers among the top 80 coins. Source: Messari

EOS gained 9% after the EOS Network Foundation announced the final testnet for the Ethereum Virtual Machine launch on March 27.

Immutable X (IMX) traded up 5% as the project became a “Unity Verified Solution,” reportedly allowing seamless integration with the Unity SDK.

DYdX (DYDX) traded down 14.5% as investors await a $17-million token unlock on March 14.

Leverage demand is balanced despite the recent price correction

Perpetual contracts, also known as inverse swaps, have an embedded rate that is usually charged every eight hours. Exchanges use this fee to avoid exchange risk imbalances.

A positive funding rate indicates that longs (buyers) demand more leverage. However, the opposite situation occurs when shorts (sellers) require additional leverage, causing the funding rate to turn negative.

Perpetual futures accumulated 7-day funding rate on March 3. Source: Coinglass

The seven-day funding rate was marginally positive for Bitcoin and Ether, reflecting a balanced demand between leverage longs (buyers) and shorts (sellers) using perpetual futures contracts. The only exception was the slightly higher demand for betting against BNB’s (BNB) price, although it was far from an alarming level at 0.2% per week.

Related: Dollar’s sharp recovery puts Bitcoin’s $25K breakout prospects at risk

The options put/call ratio reflects traders’ optimism

Traders can gauge the market’s overall sentiment by measuring whether more activity is going through call (buy) options or put (sell) options. Generally speaking, call options are used for bullish strategies, whereas put options are for bearish ones.

A 0.70 put-to-call ratio indicates that put options open interest lags the more bullish calls and is therefore bullish. In contrast, a 1.40 indicator favors put options, which can be deemed bearish.

BTC options volume put-to-call ratio. Source: Laevitas.ch

Apart from a brief moment on March 2 when Bitcoin’s price traded down to $22,000, the demand for bullish call options has exceeded the neutral-to-bearish puts since Feb. 25. Moreover, the current 0.71 put-to-call volume ratio shows that the Bitcoin options market is more strongly populated by neutral-to-bullish strategies that favor call (buy) options.

From a derivatives market perspective, the market showed resilience, so Bitcoin traders may not expect additional corrections despite the bearish indicator from the failed ascending channel. The 4% weekly decline in total market capitalization reflects the uncertainty brought by Silvergate Bank, and it is unlikely to have roots deep enough to cause systemic risk.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

Chiliz announces $50M incubator and accelerator program for early-stage blockchain projects

The company said the funds will be invested into early-stage blockchain projects that leverage the Chiliz blockchain for sports and entertainment and the Socios.com partner network.

Chiliz, a global company that deals with blockchain for sports and entertainment, has launched its incubator and accelerator program, Chiliz Labs, with the support of Jump Crypto. The $50 million program intends to invest in early-stage blockchain projects that leverage the Chiliz blockchain for sports and entertainment and the Socios.com partner network. 

According to the announcement, Chiliz aims to build the largest community of fans, brands, and developers in the sports and entertainment industry to create a dedicated sports Web3 ecosystem. These projects will leverage the new Chiliz blockchain for sports and entertainment, which had its genesis block validated on February 8th. The incubator and accelerator program promises to provide funding and strategic guidance to assist these projects in achieving their goals.

Chiliz has announced LiveLike and FanFest as the first companies to build on the new chain, with eight to ten more enterprise-level projects to come. These projects will include NFT ticketing pilots, athlete-focused Fan Tokens, and Web3 infrastructure partners building for sports and entertainment. Jump Crypto's President, Kanav Kariya, praised Chiliz for solving the problem of how to scale brands and maximize fan engagement sustainably and affordably.

Chiliz CEO, Alexandre Dreyfus, highlighted Chiliz Labs' importance in building an ecosystem of fan experiences and transactions with Fan Tokens providing a "digital key" that can work across any product or experience built on their infrastructure. Chiliz is the creator of Fan Tokens and the Socios.com fan engagement and rewards app, with more than 170 partners and over 1.8 million wallets.

Related: Binance to bring fans closer to sports teams with fan token platform

As blockchain technology continues to revolutionize industries around the world, it continues to find  interesting use case in the world of sports with the emergence of Web3 platforms, offering new ways to engage fans and drive value for sports brands.

As previously covered by Cointelegraph, Web3 projects aim to create engagement between fans and sports leagues. In Deloitte’s “2022 Sports Industry Outlook” report, it predicted an acceleration in the blending of real and digital worlds, along with growing markets for nonfungible tokens (NFTs) and immersive technologies.

According to the report, these advancements could potentially result in a boost in fan involvement, which has been the foundation for securing sponsor revenue, ticket and merchandise sales, as well as the general appeal of a sports league for a long time.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say

BitDAO’s Mantle Core proposes $200M for Web3 fund

Mantle Core is an Ethereum layer-2 network developed by the BitDAO ecosystem. The fund aims to boost the adoption among developers and Dapps.

A proposal seeking to create a $200 million fund dedicated to early-stage Web3 startups was submitted on Feb. 26 by Mantle Core on BitDAO's governance forum. The ecosystem fund aims to boost the adoption of Mantle's network among developers and Dapps. 

Mantle is an Ethereum layer-2 network developed by the BitDAO ecosystem. According to the proposal, a capital pool of $200 million would be deployed within the Mantle ecosystem over the next three years. BitDAO's treasury would provide $100 million USD Coin (USDC), while another $100 million would be supplied by external matching capital from "strategic venture partners".

Funds that have expressed interest in participating include Dragonfly Capital, Pantera, Folius Ventures, Play Ventures Future Fund, Spartan, Lemniscap, Selini Capital, Cadenza Ventures, and QCP Capital, notes Mantle's proposal.

If approved, the Mantle EcoFund and venture partners will participate in projects with 1:1 co-investment ratio. Web3 startups raising pre-seed, seed, and series A round will be targeted by the ecosystem fund.

The fund is proposed to have a three-year active investment period, plus two years of optional extension, a Mantle's spokesperson told Cointelegraph by email. The initial fund operator is proposed to be Mirana Ventures, Bybit and BitDAO’s venture partner, with an investment committee comprising representatives from Mirana Ventures, Mantle, BitDAO, and Bybit.

"The fund targets to invest in more than 100 projects deployed on Mantle and have a multiple on invested capital (MOIC) of 1.5x of cumulative performance through the fund’s lifecycle," noted Mantle's spokesperson.

EcoFund proposal summary from Mantle Core.  Source: BitDAO's governance forum. 

Management fees would match "industry standard", with 2% of management fee to support operational expenses of the EcoFund team, including sourcing, due diligence, legal, portfolio support, and fund administration.

Across the crypto industry, similar initiatives aim to drive adoption and innovation. Last year, Ethereum scaling solution Polygon launched a $100 million fund aimed at improving access to decentralized finance (DeFi), onboarding users and accelerating adoption.

‘Surgical removal’ of crypto will only weaken USD dominance, commentators say