PA Daily | MicroStrategy plans to raise $42 billion to buy more Bitcoin; Meta's metaverse division lost $4.4 billion in Q3

Today's news tips:

US Treasury says CBDC should replace stablecoins

FTX’s former engineering director Nishad Singh is spared jail

MicroStrategy plans to raise $42 billion to buy more Bitcoin over the next three years

Coinbase pledges another $25 million to support U.S. crypto political campaigns

Robinhood's Q3 cryptocurrency trading volume increased to $14.4 billion, more than doubled from last year

Coinbase announces $1 billion stock buyback after Q3 results below expectations

Metaverse lost $4.4 billion in the third quarter, with cumulative losses exceeding $58 billion

The total net inflow of US Bitcoin spot ETF yesterday was US$893 million, continuing the net inflow for 6 consecutive days

Regulatory News

The US SEC has received an application to convert the Grayscale Digital Large Cap Fund into an ETF and is seeking public comments

Nate Geraci, president of The ETF Store, said in a post on X that the US SEC has officially confirmed that it has received an application to convert the Grayscale Digital Large Cap Fund (GDLC) into an ETF, and the SEC is soliciting public opinions. Earlier, Grayscale applied to the US SEC to convert its hybrid crypto fund containing BTC, ETH and SOL into an ETF.

Hong Kong Legislative Council Member Qiu Dagen: RMB is a direction worth exploring for the issuance of stable currency in Hong Kong

PANews reported on October 31 that at the "New Financial Ecology - Web3.0 Navigation: Hong Kong Market High-end Dialogue" event, Hong Kong Legislative Council member Qiu Dagen said when talking about the development of Hong Kong stablecoins that the global scale of stablecoins has reached 100 billion US dollars. For Hong Kong, the scenario application of stablecoins is the key, such as whether it is possible to expand more scenarios besides international payments. In addition, Qiu Dagen also said that whether it is possible to issue RMB stablecoins is also a direction worth exploring at present.

US Treasury says CBDC should replace stablecoins

According to a report released by the U.S. Treasury Department on Wednesday, the U.S. Treasury Department expressed concern about the growth of the stablecoin market and believed that stablecoins issued by the private sector should eventually be replaced by state-backed central bank digital currencies (CBDCs), according to Decrypt. The report, written by the Treasury Department's Debt Management Office, stated: "Similar to the way that 'wildcat' currencies issued by the private sector in the late 19th century were replaced by government-backed central currencies, central bank digital currencies (CBDCs) may need to replace stablecoins as the main form of digital currency to support tokenized transactions." In the 132-page report on the financial status of the Treasury Department in the fourth quarter of 2024, stablecoins occupy a large space. The report mentions a large number of U.S. Treasury bonds purchased by stablecoin issuers such as Tether and Circle. The Treasury Department estimates that $120 billion worth of U.S. Treasury bonds have been purchased as collateral for stablecoins that generate income. Among them, nearly $81 billion was purchased by Tether, the company behind USDT, the largest stablecoin in the crypto market. Although many stablecoin supporters believe that stablecoins backed by the U.S. dollar have enhanced the strong position of the U.S. dollar by increasing demand for U.S. Treasury bonds, the Treasury Department does not seem convinced. Wednesday’s report focused on the “widespread phenomenon” of stablecoins decoupling or collapsing entirely in recent years, a situation the Treasury Department believes could lead to disaster if U.S. Treasuries become increasingly integrated with the stablecoin industry.

FTX’s former engineering director Nishad Singh is spared jail

According to Bloomberg, a New York federal court was ruled by Judge Lewis A. Kaplan to avoid jail time for former FTX engineering director Nishad Singh for his role in the multi-billion dollar fraud case involving the crypto exchange FTX. Singh, as a key witness, helped convict the mastermind of the fraud, FTX founder SBF. Singh's lawyers tried to distinguish him from Gary Wang and Caroline Ellison, arguing that he was not part of the core conspiracy in the case. Singh first learned in September 2022, two months before the collapse of FTX, that sister hedge fund Alameda Research had been misappropriating billions of dollars in customer funds. Judge Kaplan also agreed with this view, saying: "Your situation is different from Caroline Ellison's. She has known what was going on for many years. She has received a lot of recognition for her cooperation, but you deserve it more." Singh also agreed to forfeit his real estate in Washington State, his shares in Anthropic PBC, and other crypto assets. FTX co-founder Gary Wang will be sentenced on November 20, and he is the last of the key cooperating witnesses of the US government to be tried.

The operator of crypto market maker MyTrade has pleaded guilty to market manipulation charges filed by US authorities

The U.S. Department of Justice said the operator of cryptocurrency "market maker" MyTrade has pleaded guilty, one of the targets of a massive crackdown earlier this month that charged multiple companies and individuals with market manipulation, according to CoinDesk. Liu Zhou, 39, will stand trial in federal court early next year for "wash trading clients' cryptocurrencies on multiple cryptocurrency exchanges," according to the Justice Department. Liu Zhou once told others that "we do self-buying and self-selling - that is, buying and selling in the same second," and that its trading volume robot can perform "pump and dump" operations. Liu Zhou also allegedly said that the purpose of his company is to find "other buyers in the community, people you don't know or don't care about," because in order for the tokens to make a profit, these buyers must lose money.

According to federal indictment documents released a few weeks ago, Gotbit, CLS Global and ZM Quant were also accused of wash trading various tokens, creating the illusion of more legitimate trading activity than it actually was, and selling some of these tokens to others at "artificially inflated prices." Meanwhile, another company, CLS Global, said it had contacted U.S. authorities to cooperate.

AI

OpenAI launches chat history search function for ChatGPT web version

OpenAI announced the gradual launch of the chat history search function of the ChatGPT web version, which allows users to easily retrieve historical conversations or continue unfinished conversations. Plus and Team users will get this feature today, Enterprise and Edu users will get access within a week, and free users will gradually get this feature in the next month.

Project News

MicroStrategy plans to raise $42 billion to buy more Bitcoin over the next three years

According to CoinDesk, MicroStrategy announced its third-quarter 2024 financial results. As of the end of the third quarter, the company held 252,220 BTC, with a BTC yield of 17.8% year-to-date. The company also announced a $42 billion capital plan. The announcement stated that under the leadership of Executive Chairman Michael Saylor, the company will raise $21 billion in equity and issue $21 billion in bonds over the next three years, and use additional capital to purchase more Bitcoin as a financial reserve asset in order to achieve higher BTC returns. MicroStrategy last disclosed information in mid-September, when the company announced that it had purchased 7,420 Bitcoins for $458.2 million, bringing the number of Bitcoins it holds to 252,220. As of the end of this quarter, the company had $891.3 million remaining after its last financing. MicroStrategy also raised its target range for "BTC yield" from 4%-8% to 6%-10% previously.

The US government has sold ANT seized from Alameda before the ANT token destruction

According to The Block, the U.S. government has sold tokens seized from SBF's defunct hedge fund Alameda Research, the first transfer of funds from the wallet in nearly two years, which holds approximately $974,000 worth of cryptocurrency. Arkham chain data shows that government officials used AragonDAO's ANT token redemption address to sell more than 82,000 ANT tokens confiscated from the company. In November 2023, the Swiss nonprofit Aragon Association decided to dissolve and sell 86,343 ETH (then worth $155 million) in exchange for ANT tokens. Users are required to redeem their ANT tokens by November 2, 2024. After redemption, all ANT tokens will be destroyed. The action began with the address starting with 0xb0692 providing funds to the U.S. government's wallet, which is used to isolate funds transferred from Alameda. So far, the U.S. government has received 209.199 ETH worth $556,000 from AragonDAO. Prior to this transaction, the US government address received 0.003 ETH ($7.03) from Coinbase, likely used to pay gas fees.

Market News: Microsoft shareholders have begun preliminary voting on whether the company should invest in Bitcoin

According to Bitcoin News on the X platform, Microsoft shareholders have begun a preliminary vote on whether the company should invest in Bitcoin. Earlier on October 25, it was reported that Microsoft's December shareholders meeting would review the Bitcoin investment proposal, and the board of directors recommended a vote against it.

Reddit sold most of its Bitcoin and Ethereum holdings in the third quarter

According to Cointelegraph, the social media platform Reddit disclosed in a recent filing with the U.S. Securities and Exchange Commission (SEC) that the company sold most of its cryptocurrency holdings in the third quarter of 2024. Most of the cryptocurrencies sold came from its Bitcoin and Ethereum reserves, and the proceeds from the sale of cryptocurrencies were $6.869 million. However, Reddit added that the book value of its cryptocurrency and the proceeds recognized from the sale were negligible in this reporting period. The document also revealed that Reddit's advertising demand has declined since the epidemic due to global economic concerns, rising interest rates, and uncertainty in geopolitical conditions.

Coinbase pledges another $25 million to support U.S. crypto political campaigns

According to Bloomberg, crypto exchange Coinbase Global Inc. has added $25 million in funding to Fairshake, a political action committee for the digital asset industry that has become an important force in the U.S. election. Coinbase CEO Brian Armstrong posted on X-platform on Wednesday: "Fairshake will use the funds to prepare for the 2026 midterm elections to fund candidates who support cryptocurrencies. The results of the U.S. election will be announced in six days. This will be the most crypto-supportive Congress in history. Crypto voters are already a force to be reckoned with and will continue to grow." Fairshake, which is funded by digital asset industry giants such as Coinbase, Ripple Labs Inc. and Andreessen Horowitz, has been trying to push Republican and Democratic candidates to take cryptocurrencies seriously. In the final weeks of the 2024 U.S. election, Fairshake plans to spend more than $40 million on top of the $140 million it has already invested in dozens of congressional districts across the country.

Lottie Player suffered a supply chain poisoning attack, poisoning the front-end script module relied on by the well-known Web3 project

According to Scam Sniffer, Lottie Player suffered a supply chain attack earlier today, which may have affected projects such as 1inch and Movement. In addition, Yu Xian, the founder of SlowMist, commented: "Another supply chain poisoning attack, done by Ace Drainer and related phishing gangs, poisoning the front-end script modules that well-known Web3 projects rely on. Fortunately, it was discovered in time and the impact should not be large. If your project uses the Lottie Player module, please check whether there is any malicious code introduced (currently known versions 2.0.4 and the latest version 2.0.8 do not have malicious code)."

Robinhood's Q3 cryptocurrency trading volume increased to $14.4 billion, more than doubled from last year

According to The Block, U.S. stock broker Robinhood announced its third-quarter results, which showed that despite a slowdown in trading volume throughout the year, retail traders' interest in cryptocurrencies remained strong. Robinhood's cryptocurrency trading volume in the third quarter increased by 112% year-on-year to $14.4 billion (but decreased from the previous two quarters), and its stock trading volume increased by 65% to $286.2 billion. Robinhood's trading revenue increased by 72% year-on-year to $319 million, including $61 million in cryptocurrency trading revenue (up 165%), $202 million in options trading revenue (up 63%), and $37 million in stock trading revenue (up 37%). Despite the growth, cryptocurrency revenue declined from $81 million in the previous quarter. The company's custody assets (AUC) increased by 76% year-on-year to $152.2 billion, thanks to continued net deposits and rising valuations of stocks and cryptocurrencies. Robinhood reported earnings per share of $0.17 in the third quarter, reversing last year's loss of $0.09 per share. Quarterly revenue was $637 million, just shy of the $650.67 million expected.

Coinbase announces $1 billion stock buyback after Q3 results below expectations

According to CoinDesk, on Wednesday, the third-quarter earnings and revenue released by the crypto exchange Coinbase (COIN) fell short of Wall Street analysts' expectations, causing a sharp drop in stock prices in after-hours trading. The exchange said its total revenue in the third quarter was $1.2 billion, lower than the average expectation of $1.26 billion. At the same time, earnings per share were $0.28, also lower than analysts' expectations of $0.45. Coinbase's adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) in the third quarter were $449 million, which also fell short of expectations of $469.2 million. In a letter to shareholders, the company said the decline in performance was mainly affected by market weakness, while also pointing out that growth was seen in certain areas. The company also said it had authorized a repurchase of up to $1 billion in stock in October. There is no deadline for the repurchase, and the company will purchase shares based on market conditions. "Our balance sheet has grown by more than $400 million, which enables us to launch this new stock repurchase program," said Gupta. The company had $8.2 billion in cash, cash equivalents and USDC at the end of the third quarter. Coinbase's main source of revenue is transaction fees, but this revenue fell 27% from the second quarter as trading volume on the U.S. exchange further declined. The exchange's stock price fell nearly 7% in the minutes after the report was released. The stock has risen about 22% this year, influenced by the overall bullish sentiment of digital assets.

Canary Capital submits Solana spot ETF application to the US SEC

According to Cointelegraph, crypto asset management company Canary Capital has followed the example of VanEck and 21Shares and submitted an application to the U.S. Securities and Exchange Commission (SEC) for a spot Solana ETF. Canary explained in its S-1 registration statement filed on October 30 that the spot Solana ETF will track the price of SOL through the CF Solana Index of the Chicago Mercantile Exchange (CME). Canary's proposed spot Solana ETF will enable investors to access the Solana market through traditional brokerage accounts without facing the possible barriers to entry or risks of directly holding SOL. Canary did not disclose who the custodian of the spot SOL ETF is, nor did it specify under which stock code the fund will be listed.

Kraken cuts 15% of its workforce, affecting about 400 positions, amid restructuring

According to Beincrypto, due to recent structural changes, the crypto exchange Kraken announced layoffs, affecting 15% of its employees, or about 400 positions. In addition, Arjun Sethi will serve as co-CEO with Dave Ripley. Kraken mentioned the need for "organizational discipline" in a blog post, saying it plans to streamline the management structure that has expanded as the company's revenue exceeded $1 billion. Although the specific positions affected were not disclosed, company statements and online discussions indicated that senior management and C-level positions were hit hardest by layoffs. Kraken wrote in a blog post: "Making organizational changes is never easy, and we understand the profound impact this has on people's lives. We sincerely thank those who have helped us get to where we are today and their many contributions, and we will support them during this transition."

In addition, Kraken launched Kraken Desktop, a fully customizable desktop trading application designed for active traders .

He Yi: CZ's resignation is Binance's biggest challenge. Binance wants to become Google

PANews reported on the scene that Binance co-founder He Yi said in his speech at Binance Blockchain Week 2024 that Binance's biggest challenge was CZ's resignation last year. The resignation of a company founder is undoubtedly a huge challenge, but Binance has achieved great results by relying on a mature management system and the support of the team. Entrepreneurial teams often open up the market through the outstanding single-point performance of the founder, while a mature team with a good organizational culture can continue to grow even without a founder. The external challenge lies in regulation. Regulators have paid a lot of attention to the crypto industry. Different regulators have different understandings of the industry, so Binance cooperates with different regulators. Speaking of industry doubts about why they should cooperate with regulators in this way, He Yi said that Binance hopes to serve more users with the support of regulators and support billions of users to use cryptocurrencies. "Binance wants to be Google, want to build the future Internet world, and make Web3 more accessible." He Yi added.

Metaverse lost $4.4 billion in the third quarter, with cumulative losses exceeding $58 billion

According to financial reports, the latest financial report of US technology giant Meta shows that its metaverse business is still losing billions of dollars every quarter. Meta released its third-quarter financial report on Wednesday, saying that its Reality Labs division, which develops augmented reality and virtual reality technology, suffered an operating loss of $4.43 billion. The loss was slightly smaller than the $4.68 billion expected by analysts surveyed by StreetAccount. Reality Labs' third-quarter revenue increased 29% year-on-year to $270 million, lower than analysts' expectations of $310.4 million. Reality Labs mainly makes money by selling Meta's Quest VR headset and Ray-Ban Meta smart glasses.

Meta first entered the VR market in 2014 when it was still called Facebook and acquired VR startup Oculus for $2 billion. Meta CEO Mark Zuckerberg believes that developing VR and AR technologies can make the company the leader of the next major personal computing platform. The investment was costly for Meta. Since 2020, Reality Labs has accumulated operating losses of more than $58 billion.

Neo Smart Economy says suspicious third-party apps can access its X account posting function, please stay vigilant

Neo Smart Economy issued a reminder on the X platform: "A suspicious third-party application has been detected to access the posting function of our X account. Due to defects in the X system, we are unable to revoke its permissions. Although we have urged the X platform, in order to solve this problem, please remain vigilant: do not click on airdrop links or operation requests to send assets. Neo will never ask for money."

Meme trading tool ABOT announces it will gradually shut down its business

Meme trading tool ABOT announced that it will gradually shut down its business. The specific arrangements are as follows: service fees will be reduced to 0; Meme functions will be removed from the shelves on January 1, 2025; non-meme functions will be removed from the shelves and the website will be closed on January 7, 2025; new function development will continue until December 31, and real-time problem response will continue before the website is closed.

Security company: SUNRAY private key leaked, attackers have stolen $2.855 million

According to security company CertiK Alert, the SUNRAY FINANCE private key was leaked; the attacker gained ownership of the SUN and ARC tokens and minted a large number of tokens, which were then sold to exhaust the trading pairs. At present, the attacker has stolen $2.855 million. Previously, SUNRAY FINANCE issued an announcement stating: "Regarding the transfer of SUN and ARC token vault assets, efforts are being made to restore them. Don't worry, all user assets are available on the chain."

Investigation: YouTube celebrity MrBeast suspected of insider trading, with total profits of more than 50 crypto wallets exceeding $23 million

A new investigation by Loock Advising shows that MrBeast, a YouTube celebrity with 320 million followers, has been engaged in long-term insider trading, misleading investors, and using his influence to promote tokens and then dumping them on the market. MrBeast has made a total profit of more than $23 million in more than 50 crypto wallets. The investigation found that projects related to MrBeast include: SuperFarm, ERN, AIOZ, Refinable, CryptoPunks, VeeFriends, SHOPX, XCAD, Jigstak (STAK), Polychain Monsters (PMON), Boson Protocol (BOSON), Standard Protocol (STND), Ally Direct (DRCT), Ternoa (CAPS), METIS L2 (METIS), PlayMetaGods, MetaWars, etc.

FDUSD Stablecoin to Expand to Solana Blockchain

First Digital Labs announced that its stablecoin FDUSD will be expanded to the Solana blockchain to provide users with a faster and more efficient trading experience. This integration leverages Solana's high-performance blockchain to enable FDUSD transactions to be completed in seconds, suitable for real-time payments and settlements. In addition, Solana's low transaction fees will also significantly reduce user costs. FDUSD previously supported Ethereum, BNB Chain, and Sui, and this expansion to Solana marks a further improvement in its global liquidity and accessibility.

Financing News

Privacy-Secure Computing Network Nillion Completes $25 Million in New Round of Funding, Led by Hack VC

Nillion, a privacy-preserving computing network, announced the completion of a new round of financing of US$25 million, led by Hack VC and participated by a group of venture capitalists and angel investors. So far, its total financing has exceeded US$50 million. According to reports, Nillion was founded three years ago with the aim of creating a privacy-preserving computing network through decentralization and privacy-enhancing technologies such as secure multi-party computing and homomorphic encryption to provide better protection services for high-value data. Nillion has created the world's first blind computing infrastructure, which can provide private data storage and computing capabilities for AI agents, data markets, private DeFi, healthcare analysis, etc.

AI data collection company Sapien completes $10.5 million seed round led by Variant

Sapien, an AI data collection startup, announced the completion of a $10.5 million seed round of financing, led by venture capital firm Variant, with participation from Primitive Ventures, Animoca, Yield Game Guild and HF0. Angel investors such as YGG founder Gabby Dizon and SoftBank Vision Fund alumnus Kevin Jiang also participated in this round of financing. Sapien is led by Rowan Stone, co-founder of Coinbase Layer 2 network Base, and Trevor Koverko, founder of Polymath, and incentivizes global data providers through USDC stablecoins or reward points. Users need to pledge funds to participate in the work. If they perform well, they can get extra rewards. If there is cheating, the pledge will be deducted. Sapien currently provides data support for 17 large companies including Alibaba and Baidu, and has attracted more than 100,000 AI data labelers to join.

Important data

The total net inflow of US Bitcoin spot ETF yesterday was US$893 million, continuing the net inflow for 6 consecutive days

The total net inflow of the US Ethereum spot ETF yesterday was US$4.3576 million, and the ETF net asset ratio reached 2.27%

Bitcoin's total network computing power briefly exceeded 800 EH/s, setting a new record high

Cloverpool data shows that the total Bitcoin network computing power briefly exceeded 800 EH/s, reaching a maximum of 803.75 EH/s, a record high. Currently, the total Bitcoin network computing power is 749.52 EH/s.

The number of crypto investors in South Korea increased by 21% in the first half of 2024, and the average daily trading volume increased by 67%.

According to the Korea Daily, a report from the Financial Services Commission of South Korea showed that the number of cryptocurrency investors in the country reached 7.78 million in the first half of 2024, an increase of 21% from 6.45 million in the second half of 2023. During the same period, the average daily trading volume of cryptocurrencies increased by 67%, from 3.6 trillion won to 6 trillion won. In addition, the total market value of cryptocurrencies in the country increased by 27% to 55.3 trillion won. The profits of 21 local crypto exchanges also jumped 106% to 590 billion won.