Copper’s Weekly Update – 16 August 2021

Highlighting what went right, and what went wrong, in this week’s crypto news analysis.

Copper

Last week saw the crypto market shrug off uncertainty from Washington to break the $2T market cap barrier for the first time since May.

Bitcoin continued its decisive move upwards to cross $48k, however the cryptoasset’s dominance saw a decline from 64% to 44% with altcoins closing the performance gap.

Dogecoin experienced an impressive rally following comments from Mark Cuban that the crypo is the ‘strongest’ cryptoasset for payments – with Musk then agreeing with him. The beady eyed amongst you who tuned into the Premier League opening weekend may have also spotted the crypto’s infamous Shiba Inu logo on the sleeves of Watford FC players. This is owing to a new $1m partnership between the football club and Stake.com, a global crypto casino and sports betting platform.

But the star of the week, without a shadow of a doubt, was Cardano. In the past seven days, the price of ADA has climbed 50% and even briefly flipped BNB to make it into the top 3 cryptos. The cryptoasset’s recent extraordinary performance can be attributed to the announcement of the Alonzo upgrade. Set to take place on September 12, the network’s upgrade will usher in smart-contract functionality, as revealed by IOHK, the blockchain development team behind Cardano. Providing all goes well in September, smart contract functionality has the potential to take Cardano to the next level and we look forward to watching ADA compete with projects like Ethereum, Binance Chain, Solana and Polkadot.

If you’d like to get in touch with us about any of our products or services, we look forward to hearing from you. Just send us a note.

This week’s top stories

Poly Network hacker returns $600m, refuses $500k bug bounty

On Tuesday, hackers perpetrated the biggest theft in the world of DeFi, stealing more than $600m in cryptocurrency from the interoperability protocol, Poly Network. More than $250m was stolen from Binance Smart Chain, over $85m in USDC was taken from the Polygon network and approximately $270m from the Ethereum network. But then, in a deeply unusual twist, the attacker returned a substantial amount of the stolen funds, commenting in messages shared by Elliptic that they had perpetrated the attack ‘for fun’, and would be returning all the tokens. Some blockchain analysts have speculated that the hacker may have found it too difficult to launder stolen cryptocurrency on such a scale. Read More

Polygon acquires Hermez in $250m deal that includes first-ever token ‘merger’

Ethereum scaling project Polygon (formerly Matic Network) has acquired Hermez Network — a ZK-Rollups-based Ethereum scaling solution — for $250m. The two blockchain projects are also merging their native tokens — MATIC and HEZ — in the first ever such deal in the crypto space. Earlier this year, two Ethereum projects, Keep and NuCypher, also merged their protocols, but they kept their brands independent of each other and did not merge their tokens. Read More

Officials to clarify crypto tax reporting rules in infrastructure bill: report

The United States Treasury Department is reportedly seeking to clarify the definition of brokers in the bipartisan infrastructure bill passed by the Senate last week, offering cautious reassurance that the new legislation won’t impact innovation and growth in the blockchain industry. As reported by Bloomberg, the Treasury Department is preparing guidance on what types of crypto companies will be required to comply with new IRS reporting requirements. The report indicated that the definition of “broker” could be narrowed from what many fear would include protocol developers and wallet providers that currently operate in the cryptocurrency industry. At the time of writing, the Treasury Department has yet to confirm publicly whether these plans are true. Read more

In case you missed it

⚡️Poloniex settles for $10m with SEC for running unregistered crypto exchange.

⚡️Gensler asks Sen. Warren for more SEC authority to regulate crypto exchanges.

⚡️$400bn investment manager Neuberger Berman expands fund strategy to include bitcoin, ether exposure.

⚡️Tether claims to have increased total assets by $21bn in new accounting review.

⚡️Venmo adds Bitcoin and Ethereum credit card rewards.

⚡️Indian crypto exchange CoinDCX becomes unicorn after $90m funding round.

⚡️Bitcoin tax software firm TaxBit valued at $1.3bn after $130m raise.

⚡️Ex-SEC Director Brett Redfearn leaves Coinbase after 4 months.

⚡️VanEck files for futures Bitcoin ETF after SEC hints at path to approval.

⚡️AC Milan signs BitMEX as first-ever official sleeve partner.

⚡️Kryptoin files with the SEC to create an ETH ETF.

⚡️Coinbase stock up more than 8% after record quarter.

⚡️PNC Bank planning crypto offering with Coinbase.

⚡️Crypto fundraising DAO Maker loses over $7m in latest crypto exploit.

⚡️Lionel Messi signing bonus in PSG includes a payment in fan tokens.

⚡️Ukraine shuts down crypto exchanges sending money to Russian wallets.

⚡️South Korea’s crypto regulation is now expanding to foreign businesses.

⚡️Bitcoin development boost: FTX is donating $450k to Brink.

⚡️Israeli intelligence agency Mossad looking for a crypto expert.

From Copper

New Technical Analysis: Bitcoin overnight and weekend risk

Digital assets may be a ‘round-the-clock’ operation, but even crypto observes office hours. The latest Copper report finds that Bitcoin trading during US stock exchange hours accounts for 30% of all spot market volumes year-on-year. We then go on to analyse Bitcoin price action outside of US exchange stock hours to explore whether holding weekend or overnight positions can be lucrative or damaging for traders. Read the full report here.

Upcoming event: Parallel Summit 2021 | Thursday 19 August

This Thursday, our Chief Product Officer, Alex Ryvkin, joins the top innovators in DeFi to discuss the future of finance at the Parallel Summit. Join the conversation at 1pm ET (6pm BST) to hear their insights and thoughts on what lies ahead for policy and regulation, achieving mass adoption, yield farming, borrowing and lending, open finance applications and investing for institutions and retail audiences. Register here to attend.

Watch now: How crypto market infrastructure is maturing for institutions

Our Head of Strategy, Asen Kostadinov, and BCB Group’s Chief Product Officer, Chris Aruliah, recently appeared on Coinscrum for a deep dive on the evolving crypto market structure, DeFi, regulatory forces at play and much more. Make sure to check out the discussion here – this is a must listen.

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