Crypto News Headlines (12-Jul-2023)

Berenberg raised its bitcoin (BTC) price forecast for April 2024 to $56,630, the investment bank said in an analyst report Wednesday. The world’s largest cryptocurrency by market value was trading around $30,800 at publication time.

“Supporting our expectation that bitcoin will appreciate significantly in the coming months is improved sentiment driven by anticipation of the bitcoin halving estimated to occur in April 2024, and keen interest demonstrated by large institutions,” analysts led by Mark Palmer wrote.

The bank reiterated its buy rating on stock of MicroStrategy, a business intelligence software developer that has invested heavily in bitcoin, and raised its share price target to $510 from $430 due to a higher estimate of the value of the company’s BTC holdings and improved forecast for the value of its software business. The shares closed Tuesday at $411.18.

The Dubai digital assets regulator, the Virtual Assets Regulatory Authority (VARA), announced on July 9 that it had deemed the crypto exchange Bitoasis’ license for both institutional and qualified retail investors “non-operational.” The regulator said the license will remain in this state until Bitoasis fully addresses the regulator’s concerns.

In its latest market notification, VARA explained why it took the decision just a few months after it issued a license to the crypto exchange.

“Bitoasis was issued a conditional MVP Licence [Licence] on 12.April.2023 that would permit market operations upon the entity’s fulfillment of key conditions over 30-60 day timeframes. As a result of Bitoasis not meeting these mandated conditions within the prescribed timelines, VARA has initiated warranted regulatory actions against the entity,” the regulator said.

Bankrupt crypto lender Celsius has accused StakeHound of failing to hand back $150 million worth of various tokens which it had entrusted to the liquid staking platform.

In a complaint filed as part of Celsius’s ongoing bankruptcy proceedings, lawyers also alleged that StakeHound had violated bankruptcy rules by commencing an arbitration proceeding against the business in Switzerland.

Leveling claims of breach of contract and “willful misconduct” against StakeHound, the complaint says the firm should be required to turn over Celsius’ property, as well as pay compensatory damages and attorneys’ fees.

Lido DAO’s (CRYPTO: LDO) price has decreased 3.61% over the past 24 hours to $1.9, continuing its downward trend over the past week of -12.0%, moving from $2.17 to its current price.

The chart below compares the price movement and volatility for Lido DAO over the past 24 hours (left) to its price movement over the past week (right). The gray bands are Bollinger Bands, measuring the volatility for both the daily and weekly price movements. The wider the bands are, or the larger the gray area is at any given moment, the larger the volatility.

The trading volume for the coin has decreased 18.0% over the past week, while the overall circulating supply of the coin has increased 0.23% to over 879.60 million. This puts its current circulating supply at an estimated 87.96% of its max supply, which is 1.00 billion. The current market cap ranking for LDO is #33 at $1.67 billion.

A former security engineer for an international technology firm has been arrested and charged for allegedly using a smart contract bug to steal $9 million in cryptocurrency from a Solana-based decentralized crypto exchange.

On June 11, the United States Attorney for the Southern District of New York, Damian Williams, announced the “first-ever criminal case” involving an attack on a smart contract operated by a decentralized exchange (DEX).

In a statement, Williams claims the accused — Shakeeb Ahmed — “used his expertise to defraud the exchange and its users and steal approximately $9 million in cryptocurrency.”

The U.S. Senate Committee on Finance sought the help of the cryptocurrency industry to better understand how Congress can address the tax challenges and opportunities presented by digital assets.

In a letter made public on Tuesday, Chairman Ron Wyden and Ranking Member Mike Crapo posed a series of questions around nine subjects including loans of digital assets, wash sales and staking and mining.

“In recent months, the Committee on Finance initiated a bipartisan effort to identify key questions that lie at the intersection of digital assets and tax law,” the letter said. “The Internal Revenue Code of 1986, as amended (IRC), draws distinctions between types of property, with no straightforward classification for digital assets. This uncertainty creates complex reporting issues for taxpayers …”

British authorities have inspected 18 more sites believed to be illegally operating automated teller machines (ATMs) supporting cryptocurrencies in the United Kingdom, the country’s financial regulator announced on Tuesday.

The checks have been carried out in May and June by the FCA, working together with representatives of the South West Regional Organized Crime Unit, Bedfordshire Police, Hertfordshire Police, and the Metropolitan Police.

“This action follows the FCA’s previous inspections of a number of sites across the U.K. including East London, and Leeds, Exeter, Sheffield, and Nottingham that were suspected of hosting unregistered crypto ATMs,” the authority noted.

Grayscale Bitcoin Trust (GBTC) discount shrank to its lowest level in a year, hitting 26.7% of its NAV on July 6.

The amelioration comes amid a wave of exchange-traded fund (ETF) applications in the U.S. and the settlement of a lawsuit against one of its shareholders.

One GBTC represents the smallest unit of Bitcoin held by a U.S.-based trust. Currently, it holds BTC worth $19.07 billion. GBTC was last trading at a discount of 27.8% on the price of spot Bitcoin.

MicroStrategy’s (MSTR) plan to raise long term debt puts it under pressure to liquidate its bitcoin (BTC) holdings, but only in case of extreme price corrections, especially around its debt expiry which is due in mid-2025, broker Bernstein said in a report Tuesday.

Higher bitcoin prices means MicroStrategy has a stronger balance sheet, a higher share price and easier debt repayment without the need to sell down its cryptocurrency holdings, the report said. Furthermore, strong bitcoin prices and a higher stock price, allows the company to raise new debt or equity and to redeem existing convertible notes, the broker said.

Conversely, if bitcoin crashes and reaches “absolute depressed prices” and the value of MicroStrategy’s cryptocurrency holdings do not cover debt and certain covenants post June 2025, the “corporate structure would come under pressure from ‘spring forward’ clauses – 2028 due debt does have liquidity covenants which could spring forward the debt to 2025/26”, the report added.

The South Korean government is continuing to develop tighter regulations targeting the cryptocurrency industry with the introduction of new asset disclosure rules.

On July 11, South Korea’s Financial Services Commission (FSC) announced a new bill that will require all firms that issue or hold cryptocurrencies like Bitcoin BTC $30,858 to disclose their holdings.

According to the announcement, the FSC reviewed related proposals and gave the green light to the exposure draft bill that introduces mandatory disclosure requirements for crypto.

The new measures aim to enhance transparency in accounting and disclosure of crypto assets in line with supervision guidelines that require accounting for each transaction involving crypto. The initiative also targets revision of accounting standards that obligates disclosure of virtual asset transactions.