Crypto News Headlines (23-May-2023)

MicroStrategy (MSTR) represents an attractive alternative to Coinbase (COIN) for investors looking to gain exposure to the cryptocurrency sector, Germany investment bank Berenberg said in a report Monday.

Investors who are very bearish on Coinbase shares and are inclined to short the stock should look at pairing it with long MicroStrategy, the report said, noting that the correlation between the two stocks since Coinbase went public via a direct listing in April 2021 is 0.96.

The U.S. Securities and Exchange Commission (SEC) has characterized most crypto tokens as unregistered securities, rendering them, and the platforms that enable the trading of these digital assets, as vulnerable to further regulatory actions, the note said. The commission and other regulators have been clear in classifying bitcoin (BTC) as a commodity rather than a security, the note added.

The Securities Commission Malaysia (SC) said on May 22 that it had “issued a public reprimand against Huobi Global Limited, and [CEO] Leon Li for operating illegally in Malaysia.” In addition to the public censure, the Malaysian securities regulator also ordered the crypto exchange platform to stop operating in the country.

According to the regulator, Huobi must “disable its website and mobile application on several platforms such as Apple Store or Google Play.” Besides ordering the crypto exchange to stop inviting investors to its platform, the statement released by the regulator said the crypto exchange should also stop soliciting investments via emails or social media platforms.

In the statement, the Malaysian regulator said the decision to bar Huobi Global was made after it noted the crypto platform’s compliance failures.

Michael Saylor, MicroStrategy co-founder and executive chairman, has become one of the few Bitcoin maximalists to publicly embrace Ordinals.

Ordinal inscriptions are similar to NFTs, which primarily exist on rival network Ethereum. Inscriptions allow for arbitrary and non-financial information, such as images, to be included on the Bitcoin blockchain. Short for “Bitcoin Request for Comment,” BRC-20 is an experimental framework for building fungible tokens on Bitcoin using the Ordinals protocol.

Over the past couple weeks though, Ordinals and BRC-20 tokens have taken center stage as transaction fees skyrocketed. It has kicked off many discussions within the Bitcoin community over whether the network was being attacked and if these transactions should be censored.

Institutional investor sentiment over digital assets took another beating last week, with “poor sentiment” around Bitcoin (BTC) leading to yet another week of outflows of digital asset investment products.

According to CoinShares’ latest edition of its “Digital Asset Fund Flows Report,” published on May 22, outflows for crypto funds totaled $32 million between May 15 and May 19, marking the fifth week of outflows in a row.

Coinshares head of research James Butterfill noted that similar to a trend over the last five weeks, most of the negative sentiment revolved around Bitcoin. The latest week of institutional shedding now equates to $232 million worth of outflows over the period.

5th Consecutive week of crypto outflows of US$32m, poor sentiment focussed on BTC

The United States Federal Bureau of Investigation (FBI) has warned citizens about a new scam crypto job advertisement in circulation.

On May 22, the FBI issued a warning, saying U.S. citizens and individuals living or traveling abroad should be aware of false job advertisements linked to labor trafficking.

According to the advert, victims have been “held against their will, intimidated, and forced to commit international cryptocurrency investment fraud schemes.”

The warning continues by saying victims have been primarily targeted in Asia and are offered a wide range of opportunities, including technical support, call center customer service, and beauty salon technicians. However, upon arrival in a foreign country, job seekers are “coerced” into committing cryptocurrency investment schemes.

Cryptocurrency and Bitcoin BTC $27,354 ATM provider, Bitcoin of America, consented with the Connecticut Department of Banking to halt its operations due to a lack of licensing.

In a statement released on May 22, the Department of Banking highlighted that Bitcoin of America failed to obtain a proper license to operate Bitcoin ATM kiosks in the state. However, the consent order was enforced after four Connecticut consumers lost tens of thousands of dollars in a scam involving the kiosks in question. The state revealed:

“As a result of the consent order, Bitcoin of America made restitution to these consumers totaling $86,000. Following a criminal indictment, Bitcoin of America is winding down operations here in Connecticut.”

There is limited upside for cryptocurrency markets in the near-term, Bank of America (BAC) said in a research report Friday.

“Low conviction, limited catalysts and outperformance year-to-date leave the digital asset sector stuck in a trading range with a challenging macro backdrop likely capping digital asset upside,” analysts Alkesh Shah and Andrew Moss wrote.

The bank says conversations with clients suggest that hedge funds are returning to token trading, “with momentum strategies likely benefitting to some extent from heightened volatility due to declining trading volumes.”

According to Brad Garlinghouse, the CEO of the blockchain firm Ripple, Europe has been “a significant beneficiary” of the confusion in the United States’ crypto industry sparked by the Securities and Exchange Commission (SEC). The confusion has in turn forced crypto firms to invest outside the U.S.

In an interview with CNBC, Garlinghouse, whose firm acquired Swiss crypto startup Metaco on May 17, warned that the SEC’s crackdown means his company will attempt to limit its dealings with U.S. companies and citizens.

“[The SEC crackdown] has unfortunately encouraged companies like Ripple to invest more outside of the United States. About 95% of our customers are non-U.S. and this year most of our hiring will be non-U.S. for those exact same reasons,” Garlinghouse said.

It’s been a bearish quarter for crypto hackers, a new report shows.

Blockchain intelligence firm TRM Labs revealed that the industry saw a dramatic drop in the number of hacks in the first quarter of 2023 due to recovery efforts and sanctions placed on the Ethereum mixer Tornado Cash.

The report states that hackers stole approximately $400 million from crypto projects across 40 attacks, representing a 70% decrease in money stolen compared to the same period in 2022.

While the number of hacking incidents held steady quarter-over-quarter, the average size of each hack dropped from $30 million to $10.5 million.

Moreover, the amount stolen through hacks in Q1 2023 was less than in any quarter in 2022.

Dubai, known for its proclivity to break boundaries and create the extraordinary, is setting the pace again. This time, it’s through the establishment of the world’s first Bitcoin Tower – a 40-story skyscraper about to revolutionize the hospitality and real estate sectors. Pioneered by visionary Italian entrepreneur Salvatore Leggiero and backed by Metaverse Investments LLC, this revolutionary project aims to conflate digital and physical real estate in the heart of one of the most dynamic cities on the planet.

Reinventing hospitality in the blockchain era

In a unique blend of traditional hospitality and cryptocurrency, the Bitcoin Tower isn’t just a luxurious accommodation; it’s a symbol of the digital age, illustrating cryptocurrencies’ increasing importance and influence in our everyday lives. The hotel chain’s innovative approach transforms the hotel experience by offering guests exclusive NFTs (Non-Fungible Tokens) as rewards. These tokens prove authenticity and ownership in the digital realm, granting holders exclusive privileges.