Crypto investors cool on Bitcoin funds, turning to Ether and XRP

July 25, 2023 Coin Telegraph

Ark Invest

Bitcoin-related funds saw outflows of $13 million over the past week, reversing five weeks of bullish inflows, according to Coinshares analyst James Butterfill.

Bitcoin-related investment products appear to have lost some of their sheen among crypto investors, recording its first week of outflows since Blackrock filed for spot Bitcoin ETF in June.

According to a July 24 report by CoinShares’ head of research, James Butterfill, Bitcoin (BTC) investment products saw outflows of $13 million for the week ending July 21, reversing five weeks of inflows.

Short Bitcoin products also saw outflows of $5.5 million in the week.

Bitcoin Fear and Greed Index is 50 ~ Neutral
Current price: $29,178 pic.twitter.com/T1DMFpsX9p
— Bitcoin Fear and Greed Index (@BitcoinFear) July 25, 2023

In contrast, Ethereum (ETH) and XRP (XRP) investment products recorded combined inflow of $9.2 million over the last week.

Butterfill noted that Ethereum investment products were the best performer last week with inflows of $6.6 million, while XRP funds recorded an inflow of $2.6 million. Other altcoins, such as Solana (SOL) and Polygon (MATIC) tracked inflows of $1.1 million and $0.7 million respectively.

*Flows by the top digital asset investment products. Source: CoinShares.*

The apparent change of heart follows Ripple’s partial victory against the United States Securities and Exchange Commission on July 13, where the court ruled that XRP isn’t a security when sold on exchanges to the general public.

The news spiked XRP’s price up 76% to $0.83 before cooling off to $0.69 at the time of writing.

Bitcoin however still remains the dominant digital asset investment product, with $558 million in inflows so far in 2023 and a total of $25.0 billion in assets under management — amounting to 67.4% of the total market share.

BTC is currently priced at $29,128, down 3.1% over the last 24 hours.

Over the last month, a host of financial institutions have filed for Bitcoin spot Exchange Traded Fund applications with the SEC since mid-June, including BlackRock, ARK Invest, Fidelity, Galaxy Digital, VanEck, Valkyrie Investments, NYDIG, SkyBridge and WisdomTree.

Magazine: Should you ‘orange pill’ children? The case for Bitcoin kids books

Payments provider Affirm to sunset crypto program after 19% staff cut

February 9, 2023 Coin Telegraph

Affirm

Users will not be able to buy Bitcoin after Mar. 2, and the “Affirm Crypto Program” will officially shut down on Mar. 31.

Max Levchin, the CEO of buy-now-pay-later company Affirm, has confirmed that they will be shutting down their “Affirm Crypto Program” amid dampening consumer spending and a changing macroeconomic environment.

The CEO released a letter to shareholders on Feb. 8 alongside a 19% staff cut. He cited uncertain macroeconomic conditions and the need to offset some liabilities on the firm’s balance sheet as the two main reasons behind the decision:

“In a period of increased economic uncertainty, we are doubling down on our core businesses, delaying projects with less certain revenue timelines, and aligning our operating expenses with revenue. Concurrent with reducing our workforce, we are sunsetting several initiatives, such as Affirm Crypto.”

The firm’s chief financial officer Michael Linford said the decision was made to meet profitability goals.

“We have taken decisive actions to reduce expenses. We believe our cost base is now appropriately sized to meet our profitability goals while still supporting our product roadmap and long-term growth ambitions,” he said.

Affirm is a millennial-facing payments service provider similar to Afterpay which allows customers to purchase a product online and pay later.

The firm launched the “Affirm Crypto Program” in late 2021 near crypto’s market peak when it partnered with Bitcoin payments platform NYDIG to process Bitcoin (BTC) transactions and provide a crypto account for Affirm users.

The program enabled users to set up a scheme where monthly interest accrued from a user’s savings account would be automatically converted into BTC.

However, Affirm noted its cryptocurrency program will officially close on Mar. 31, according to the Affirm website:

“On March 2, 2023, the ability to purchase bitcoin through the Affirm app will end. We will be discontinuing the Affirm Cryptocurrency Program on March 31, 2023.

“Any bitcoin in your account when the program ends will be sold at CME CF Bitcoin Reference Rate (BRR) as of 4:00 p.m. London Time, and the sale proceeds will be deposited into your Affirm Savings account,” the note added.

*As of Mar. 2, Affirm users will no longer be able to buy Bitcoin. Source:* *Affirm.*

The shutdown is of course a part of a larger staff cleanout for the San Francisco-based lending platform. Levchin said the 19% reduction in its workforce took effect today.

In a Feb. 8 note to employees, Levchin shouldered the blame by stating that he acted too slowly to actions from the U.S. Federal Reserve:

“Everything changed in mid-2022. Over the last three quarters, the Fed increased its benchmark rate at an unprecedented pace. This has already dampened consumer spending and increased Affirm’s cost of borrowing dramatically. The root cause of where we are today is that I acted too slowly as these macroeconomic changes unfolded.”

Approximately 2,593 individuals claim to be employed at Affirm, according to current figures from LinkedIn.

This means about 500 people were likely impacted by today’s announcement.

Cointelegraph reached out to Affirm to find out how many employees related to its crypto initiative were impacted, however, no additional information was shared.

The CEO did however state in the letter that he expects to keep the current headcount to remain essentially flat for the foreseeable future.

The price of Affirm’s stock, tickered AFRM, has fallen 19.1% in after-hours trading in the NASDAQ, according to Google Finance.

Bitcoin Miner Argo Blockchain Sells Helios Facility to Galaxy Digital for $65 Million, Galaxy to Host Argo’s ASIC Fleet in Texas

December 29, 2022 Bitcoin.com

Bitcoin Miner Greenidge Enters Non-Binding Debt Restructuring Deal With NYDIG

December 20, 2022 Bitcoin.com

Bitcoin miner Greenidge signs $74M debt restructuring agreement with NYDIG

December 20, 2022 Coin Telegraph

Bitcoin miner Greenidge signs M debt restructuring agreement with NYDIG

Coin Telegraph

The deal, if executed, would essentially restructure the company into a hosting firm for Bitcoin mining rigs.

According to a new filing with the U.S. Securities and Exchange Commission on Dec. 20, Bitcoin (BTC) miner Greenidge stated that it reached an agreement with its creditor, fintech firm NYDIG, to restructure approximately $74 million worth of debt. The deal, in the form of a non-binding term sheet, would result in a major change to Greenidge's current business strategy. Essentially, it would transform Greenidge from self-mining to hosting for NYDIG's mining rigs.

Under the conditions, NYDIG would purchase miners with approximately 2.8 exahash per second (EH/s) of mining capacity to be hosted by Greenidge, which will facilitate NYDIG rights to a mining site within three months following the completion of debt restructuring and hosting agreements. In exchange for consideration amounting to the purchased miners and transfer of mining infrastructure and credits to NYDIG, the firm would agree to a $57 million to $68 million debt reduction for Greenidge.

Additionally, Greenidge will be collateralizing a sizable portion of its unencumbered assets to secure the remaining balance of the NYDIG loan. The firm would retain ownership of miners with a capacity of 1.2 EH/s. As of October 31, 2022, Greenidge had approximately 2.5 EH/s of mining capacity from approximately 24,500 miners in service.

However, the company also wrote that "there remains uncertainty regarding Greenidge's financial condition and substantial doubt about its ability to continue as a going concern." Last month, Greenidge used approximately $8 million of its cash during operations, of which $5.5 million went to principal and interest payments. As of November 30, 2022, the company's cash balance amounted to approximately $22.0 million. Greenidge also warned that "NYDIG and Greenidge will endeavor to enter into definitive documentation reflecting the terms described in this release, but there can be no assurances made that such terms will not change materially nor can there be any assurances made that the transactions discussed in this release will be consummated."

Last September, Cointelegraph reported that Greenidge completed a merger with customer and technical support solutions provider Support.com to become a publicly listed mining firm on the NASDAQ. Since then, shares have plunged over 99%, partly due to a combination of the ongoing crypto winter, higher electricity prices, higher mining difficulty, and lower market prices for Bitcoin mining rigs.

Asset management firm launches BTC Lightning Network startup accelerator

October 27, 2022 Coin Telegraph

1ml

The startup accelerator will consist of four yearly 8-week programs, with successful applicants receiving $250,000 and one receiving an additional $500,000 at the end of the program.

Asset management firm Stone Ridge, the parent company of Bitcoin company NYDIG, has launched the first startup accelerator that focuses on the Bitcoin Lightning Network and the Taro protocol, called In Wolf’s Clothing (Wolf).

The accelerator consists of 8-week programs in which the best founders and startup teams from around the world will be brought to New York City, with accommodation and travel costs covered.

The teams which apply and are accepted into the program will receive a guaranteed investment of $250,000. One team will be chosen by a panel of judges to receive an additional $500,000 of funding during the demonstration day at the end of each program.

The programs will occur four times per year, with the first now open to applications and set to kick off in April next year.

Kelly Brewster, the CEO of Wolf, pointed to one-on-one mentorships and access to a range of specialists as additional benefits of the program.

Working alongside experts from Wolf, Stone Ridge, NYDIG, and beyond, founders will get funding, one-on-one mentorship, and access to specialists in bitcoin, cryptography, regulation, engineering, branding, marketing, sales, and more.
— Kelly Brewster (@kbbrewster) October 26, 2022

Despite macroeconomic headwinds and a huge drop in the price of Bitcoin (BTC), the Lightning Network has continued to see rapid growth in its capacity over the last year, recently breaching the 5,000 BTC threshold after having only hit 4,000 BTC in June.

*Bitcoin Lightning Network capacity. Source* *lookintobitcoin.com*

The Lightning Network is a layer-2 solution built on top of Bitcoin that allows users to send satoshis, the smallest amount of Bitcoin can be divided into, with greater speeds and lower fees.

The Taro protocol is a Taproot-powered protocol designed by the Bitcoin software firm Lightning Labs, which allows assets issued on the Bitcoin blockchain to be transferred to the Bitcoin Lightning Network.

In other words, Taro allows the Lightning network to become a multi-asset network with Bitcoin at its core.

According to data from 1ml, at the time of writing the network's capacity is currently sitting at 5,140 BTC, representing a 5.43% increase over the past month, and median transaction fees are well under 1 millionth of a cent per satoshi.