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Crypto-finance company Amber Group valued at $1B following $100M raise

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Cryptocurrency investment platform Amber Group has added $100 million to its coffers following a successful Series B fundraiser, bringing its total pre-money valuation to $1 billion — a major milestone for the firm as it enters its fourth year of operations. 

The cash injection will be used to “expand global operations to meet client demand and develop market solutions for the world’s leading crypto investors and companies,” co-founder and CEO Michael Wu said.

Measures of trade volume and total assets under management showcase Amber Group’s significant growth over the past four years. The company now has over $1 billion in assets under management, with more than $500 billion worth of cumulative trade volumes.

“We’ve had record months over the past quarter across both client flow and on-exchange market-making volumes,” Wu said, adding:

“Since stepping up our on-screen presence, we now account for 2-3% of total trading volumes in major spot and derivative markets and are continuing to see growth. Our cumulative trading volumes have doubled from $250 billion since the beginning of the year to over $500 billion.”

In terms of notional trade volume, Amber Group ranks 21st among global exchanges, according to BitMEX data.

Amber’s assets topped $530 million in 2020, representing a 275% increase from the prior year. At the time, Wu told Cointelegraph that his company has “already proven we can provide institutional-grade integrated crypto financial services.”

In addition to its Series B backers, Amber Group has received direct funding from some of blockchain’s biggest venture funds, including Pantera Capital, Coinbase Ventures and Blockchain.com.

Related: Financial advisers lead the institutional push toward crypto adoption

Venture funds have poured billions of dollars into the crypto economy over the past six months, highlighting their conviction in the new asset class. Just this month, Solana Labs finalized a $314 million private token sale, PayPal and Salesforce contributed $14 million to TRM Labs and DeFi exchange dYdX raised $65 million through a Series C fundraiser.

Crypto-finance company Amber Group valued at $1B following $100M raise

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Bitcoin derivatives data shows pro traders ignored today’s $41K pump

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Sometimes all Bitcoin (BTC) needs to pump 10% is a positive remark from someone like Elon Musk.

The Tesla CEO has been pointed to as the culprit for the recent downturn after the company’s May 12 announcement explaining that it would no longer accept Bitcoin payments due to environmental concerns. Musk followed up by saying that he was looking into other cryptocurrencies that required 99% less energy consumption. 

However, on June 13, the situation reversed as Musk reassured the public that Tesla did not sell any additional Bitcoin. The post also said that the electric-car producer would resume taking BTC payments as soon as its Bitcoin mining relied on a minimum of 50% clean energy.

In bear markets, top traders act with caution

While retail investors and algorithmic trading bots jump into action as soon as bullish or bearish signals and news flash, top traders tend to act more with more caution. Those who have been around the crypto markets long enough know that positive news might end up being ignored or severely downplayed in bear markets.

On the other hand, even potentially negative news seems to have little to no impact during bull runs. For example, on Sept. 26, 2020, Kucoin was hacked for $150 million. The following week, on Oct. 1, the United States Commodity Futures Trading Commission charged BitMEX for operating an unregistered trading platform and violating Anti-Money Laundering regulations.

Two weeks later, police reportedly questioned the founder of OKEx, forcing the exchange to suspend crypto withdrawals. Had this series of negative news happened while Bitcoin was flat or in a bearish phase, the price would have undoubtedly have stalled during a bear market.

Bitcoin price at Coinbase in USD, Sept. 2020. Source: TradingView

As shown above, Bitcoin barely had any negative impact in late September and October 2020. In fact, by the end of November 2020, Bitcoin was up 74% in two months. This is the main reason why top traders tend to ignore positive news during bear markets and vice-versa.

The 3-month futures premium is neutral

A futures contract seller will usually demand a price premium to regular spot exchanges. This situation is not exclusive to crypto markets and happens in every derivatives market because in addition to the exchange liquidity risk, the seller is postponing settlement and this results in a higher price.

The 3-month futures premium (basis rate) usually trades at a 5% to 15% annualized premium in healthy markets. When futures are trading below the regular spot exchange price, it signals a short-term bearish sentiment.

Huobi 3-month Bitcoin futures basis. Source: Skew

As shown above, the future basis has been below 11% since May 20 and flirting with bearish territory on multiple occasions as it tested 5%. The current level indicates a neutral position from top traders.

The options skew is no longer signaling fear

The 25% delta skew compares similar call (buy) and put (sell) options side-by-side. It will turn positive when the protective put options premium is higher than similar risk call options.

The opposite holds when market makers are bullish and this causes the 25% delta skew indicator to enter the negative range.

Deribit Bitcoin options 25% delta skew. Source: laevitas.ch

The above chart confirms that top traders, including arbitrage desks and market markers, are currently uncomfortable with Bitcoin price as the neutral-to-bearish put options premium is higher. However, the current 7% positive skew is far from the 20% exaggerated fear seen in late May.

Derivatives markets show no evidence of top traders getting excited about the recent $40,000 hike. On the bright side, there is room for leverage buyers to mount positions. Stronger upswings usually occur when investors are least expecting, and the current scenario seems to be a perfect example.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Bitcoin derivatives data shows pro traders ignored today’s $41K pump

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Solana (SOL) and Enzyme (MLN) rally while the wider market remains flat

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Significant price corrections like the one see in May inflict widespread pain for a majority of market participants and can be a death sentence for struggling projects as token holders capitulate and dump their holdings for any price offered. 

While these periods are useful to help shakeout the weak hands and weed out unnecessary projects, they also offer strong performers the opportunity to stand out from the crowd and attract the attention of eager investors looking for a safe haven during choppy markets.

Two projects that have been more resilient than crypto majors and are down less than 20% from their highs established prior to the May 18 market sell-off are Solana (SOL) and Enzyme (MLN).

Enzyme benefits from the Coinbase bump

Out of the top 200 coins, Enzyme has outperformed the field in terms of bouncing back following the sell-off as the MLN token surged 150% from a low of $75.50 on June 4 to a high at $185 on June 7, propelled by a record $45 million in 24-hour trade volume.

MLN/USDT 4-hour chart. Source: TradingView

Enzyme is a decentralized finance (DeFi) protocol designed for on-chain asset management and meant to empower investors to build, scale and monetize investment strategies that can be utilized by other members of the Enzyme community.

After a relatively quiet start to June, Enzyme began receiving more notice on Twitter beginning on June 6 with Messari analyst Jack Purdy pointing out that “even with prices down 40% from a few weeks ago Enzyme AUM are still close to all-time highs.”

While there was no major developments for the protocol as the price started to rise significantly beginning June 4, the June 8 revelation that MLN would be added to Coinbase Pro appears to be the driving force behind the tokens recent surging price demonstrating that the Coinbase bump still has the potential to move prices.

Solana rebounds from its May 19 low

The second token that quickly rebounded from the May crash is Solana (SOL), a layer-one proof-of-stake protocol capable of processing 65,500 transactions per second (TPS).

Related: Solana Labs raises $314M via private token sale as ecosystem support expands

Momentum for the project began picking up on June 2 following the announced launch of the Metaplex NFT platform which offers “a radically new approach to NFTs and NFT storefronts” on the Solana blockchain.

SOL/USDT 4-hour chart. Source: TradingView

This announcement was followed up by a series of other project launches on Solana including the algorithmic decentralized lending and borrowing platform Solend and the decentralized, capital-efficient derivatives exchange Moët Finance.

According to data from Cointelegraph Markets Pro, market conditions for Solana have been favorable for some time.

The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. SOL price. Source: Cointelegraph Markets Pro

As seen on the chart above, the VORTECS™ Score for SOL has been green for the most of May, with its score quickly recovering above 67 on May 24 to reach a high at 80 on June 4 as its price began to rally 30% over the next three days.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Solana (SOL) and Enzyme (MLN) rally while the wider market remains flat

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Why Bitcoin’s next breakout may not be an altcoin season signal

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On April 14, Bitcoin (BTC) reached a $64,900 all-time high after accumulating 124.5% gains in 2021. However, a 27.5% correction followed over the next eleven days, marking a $47,000 local bottom.

The popular Crypto Fear and Greed Index reached its lowest level in 12 months on April 25, signaling that investors were closer to “extreme fear,” which was a complete reversal from the “extreme greed” level seen during the Bitcoin rally above $60,000.

This downward move from April 14 to 25 wiped out $200 billion from the altcoin market capitalization. Still, the recovery that followed could serve as a guide on what to expect when Bitcoin finally manages to exit the sub-$40,000 level.

Bitcoin price in USD, Coinbase. Source: TradingView

Altcoins posted a similar trend, bottoming at $850 billion on April 22 but fully recovering to a record $1.34 trillion high on May 10. There is no guarantee that this pattern will repeat, but there is no better source of information than the recent market itself.

Altcoin market capitalization, USD billion. Source: TradingView

Cheaper is not always better

Many investors believe that altcoins consistently outperform when Bitcoin price takes off, but is that an absolute truth?

Although that has been the case in 2021, Bitcoin was the clear winner in the last quarter of 2020 as it surpassed the broader market by 110%. However, analyzing the winners from the late-April bull run could provide interesting insights on what to expect for the next rally.

Top altcoin performances from April 22 to May 9. Source: CoinCodex

Among the top-100 tokens, Ether Classic (ETC), Polygon (MATIC), Waves, and Fantom (FTM) were the clear winners. The winners were either scaling solutions or smart contract platforms, and the sector leader Ether (ETH) also outperformed the market.

80% of the worst performers were sub-$1 coins which is precisely the opposite of investors’ usual expectations. There’s a persistent myth that cheap, nominally-priced altcoins will excel during altcoin rallies, but that clearly was not the case.

Worst performance from the top-100 altcoins between April 22 to May 9. Source: CoinCodex

Timing the market is impossible

Unfortunately, there is no way to predict when the current correction will be over, and altcoins historically do not usually excel during bear trends. This means calling ‘alt season’ at the first sign of Bitcoin’s price recovery is an inaccurate strategy that can lead to financial ruin.

A general rule of thumb for an ‘alt season’ kick-off is two or three consecutive days of 30% or higher accumulated gains on cryptocurrencies with little-to-no development, including Dogecoin (DOGE), Litecoin (LTC), and Ether Classic (ETC).

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Why Bitcoin\’s next breakout may not be an altcoin season signal

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Altcoin Roundup: Post-crash prices give investors a chance to build a diversified portfolio

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Welcome to Cointelegraph Market’s Altcoin Roundup, an in-depth newsletter that focuses on investing from the perspective of fundamental analysis and seeks to identify emerging blockchain projects and tokens that fill niche demands within the growing cryptocurrency market.

The concept of multi-sector investing has long been advocated in traditional finance as the conventional approach to building a balanced portfolio. Typical allocations include representation of stocks, government and corporate bonds, commodities and real estate.

Now that the cryptocurrency market has grown to a multitrillion-dollar ecosystem with numerous emerging assets, clear sectors are beginning to emerge. Savvy crypto investors looking to apply portfolio diversification practices to their holdings should begin to pay attention.

Total cryptocurrency market capitalization. Source: CoinMarketCap

The previous Altcoin Roundup discussed some of the top layer-one solutions and coins like Polkadot/DOT, Cosmos/ATOM and Solana/SOL that have been gaining prominence over the past year, but these projects could also fall under the large-cap investment umbrella alongside high-profile assets like Bitcoin (BTC), Ether (ETH) and Cardano’s ADA.

Once an investor has an adequate representation of blue-chip projects, other emerging sectors like decentralized finance (DeFi), oracles and stablecoins can be considered.

DeFi: Uniswap, Aave and PancakeSwap

Decentralized finance emerged during the summer of DeFi in 2020, and the sector helped kick off the current bull market by bringing a new level of excitement to the crypto ecosystem, which was in need of the next big innovation.

One of the best metrics used to demonstrate the rising success of DeFi as a whole is the total value locked (TVL) ranking, which collectively reached an all-time high at $157.63 billion on May 14, according to data from Defi Llama, and stands at $116.62 billion at the time of writing.

Total cryptocurrency market capitalization. Source: CoinMarketCap

The release of Uniswap’s decentralized exchange (DEX) interface — which enabled new projects to immediately launch and made tokens available to the general public — helped ignite a wave of growth and innovation across the market that continues to expand to this day.

In less than a year, Uniswap evolved into the top DEX serving the crypto community, seeing an all-time record of $5.74 billion in 24-hour trading volume during the market sell-off on May 19 and $5.37 billion in total volume locked on the platform.

Daily DEX volume. Source: Dune Analytics

The vast array of liquidity pools is the primary allure for investors looking to diversify their crypto portfolio. Through these pools, stakers have the ability to earn a yield by providing liquidity for the exchange in return for a portion of the trading fees. A number of pools offer staking returns ranging from 25% to 2,000%, and traders are able to select pools based on a variety of factors, including their appetite for risk.

While Uniswap has led the way for DEXs, there are other options like Aave’s lending platform that has emerged as the highest-ranking DeFi protocol by total value locked, with more than $14.1 billion in TVL at the time of writing.

Aave’s recent decision to offer layer-two (L2) access on Polygon has brought renewable energy to the AAVE ecosystem, as traders and liquidity gladly migrated to the lower-fee environment offered on Polygon. This resulted in a significant boost in TVL for both AAVE and Polygon’s native token, MATIC, which is now the second-ranked protocol by TVL, with $11.08 billion locked on the protocol.

Every balanced portfolio also has a small 1% to 5% allocation reserved for higher-risk assets, and the crypto market has no shortage of high-risk, high-growth assets.

For tokenholders who are open to a little more risk in return for higher yields, the Binance Smart Chain-based PancakeSwap boasts a TVL of $7.67 billion, and offers annual percentage rates (APR) of up to 482.54%, according to the project’s website, with all rewards paid out in the protocol’s native CAKE token.

Stablecoins are the new “savings accounts”

Though a token that stays pegged to a fixed value may not sound like the most attractive opportunity for investors, stablecoins have evolved to play a crucial role in the functioning of the wider cryptocurrency ecosystem.

Stablecoins often serve as the backbone of trading pairs on centralized and decentralized exchanges, as well as offering traders a simple way to lock in gains.

The two most prominent stablecoins are Tether (USDT) and USD Coin (USDC), which have circulating supplies of $60.9 billion and $21.6 billion tokens, respectively. Tether is currently the most traded crypto token, boasting 24-hour trading volumes that range from $100 billion to $290 billion.

Tether (USDT) vs. USD Coin (USDC) vs. DAI circulating supply. Source: CoinGecko

Other popular stablecoins include Binance USD (BUSD), the stablecoin created for use within the Binance Smart Chain ecosystem, as well as the algorithmically controlled stablecoin DAI, which is minted via pledging collateral on the Maker protocol.

For those looking to earn a little extra yield while in the safety of stablecoins, there are multiple options available such as depositing tokens into a lending protocol like AAVE to earn up to 5% on deposits or the decentralized stablecoin exchange Curve, which offers yields of up to 50% for some stablecoins pools offered.

Other popular options include supplying liquidity for the various decentralized exchanges like PancakeSwap, which offers 8.64% for its DAI-BUSD liquidity pool, or QuickSwap, which offers a reward plus fee of the annual percent yield of 15.01% for its USDT-USDC pool and 26.75% for its DAI-USDC pool.

Oracles

In a world that is becoming increasingly dominated by digital data, no cryptocurrency portfolio would be complete without access to an oracle provider. These entities are the industry’s heavyweights that facilitate the secure exchange of data and information within the cryptocurrency ecosystem, as well as wider financial markets.

Currently, Chainlink is one of the most dominant oracle projects and a key player that comprises a thriving open-source community of data providers, node operators, smart contract developers, researchers and security auditors.

While the Chainlink network doesn’t currently offer a direct way to earn a yield through a simplified staking or governance mechanism, it is easy for tokenholders to put their stash to work in DEX liquidity pools and DeFi protocols like Aave.

For investors who are not ready to trust decentralized exchanges and DeFi platforms, centralized yield-bearing companies like Nexo, Celsius and BlockFi are also available for crypto investors looking to earn a return on their holdings.

Centralized exchanges like Coinbase and Binance also offer direct staking capabilities. For example, investors could stake BAND for up to 11.7% APR on major exchanges.

As a result of the May sell-off, which saw more than $1.2 trillion in value wiped out of the cryptocurrency market, many of the top projects are now well below their all-time high values and trading at what some investors would describe as “bargain bin” prices.

While market participants remain unsure as to which way prices are headed in the short term, it would be wise to investigate these opportunities sooner rather than later, as the notoriously volatile crypto market can make significant moves at the drop of a hat.

Want more information about diversification into the above mentioned projects?

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Altcoin Roundup: Post-crash prices give investors a chance to build a diversified portfolio

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Coinbase Stock Keeps Falling – Is it a Sell Signal for Bitcoin?

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Despite what was a strong earnings performance for crypto exchange Coinbase (COIN) in its first report as a publicly-traded company, the stock hasn’t stopped falling since its direct listing.

In its Q1 2021 earnings report, the Bitcoin exchange revealed a total revenue of $1.8 billion, compared with $585 million in Q4 2020. In addition, Coinbase reported that its total trading volume stood at $335 billion, with institutional investors trading the most, at $215 billion. Retail investors contributed $120 billion in the first three months of the year.

Bitcoin is a Double-Edged Sword for Coinbase

Coinbase said that Bitcoin accounted for 39% of trades by value 39, Ethereum at 21%, and other altcoins making up the remaining 40%. The exchange also said that it took in $1.5 billion in retail transaction revenue i the highlighted period.

The shares performance since listing on Nasdaq has been dire, seeing it drop from $328 on the opening day to $248, falling 10.13% in the last 24hrs.

coinbase stock

The bearish price action is primarily because Coinbase’s stock is tied to the success of the crypto market, especially Bitcoin. And with the broader crypto market suffering a major relapse since Tesla’s decision to stop accepting BTC for its electric sedan, Coinbase stock value has tanked along with Bitcoin’s.

The wider crypto market is showing signs of panic – at least among newer investors. The total market cap of the crypto market has fallen from the highs of $2.3 trillion to $2.12 trillion.

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New Funds Should Be Used For Diversification

Still, Coinbase is raising more funds. The exchange revealed in a Monday release that it intends to offer $1.25 billion of convertible debt to qualified institutional buyers. According to Coinbase, this debt will mature in 2026 and be converted to its Class A common stock.

Many financial experts see this as an opportunity for the crypto exchange to grow. Industry experts are urging the crypto exchange to diversify its offerings to arrest its dependence on Bitcoin price action. According to them, the expected funds should create more revenue sources around the crypto space.

Speaking to news outlet MorningStar, Chief Investment Officer of crypto hedge fund Tradecraft Capital, Jake Ryan said Coinbase’s revenue dried up during the crypto bear market of 2018. He also recommended that new funds raised from the convertible debt be channeled towards acquisitions and beefing up its crypto financial services.

Staking could be big revenue stream for Coinbase

Others such as Kyle Voigt of Keefe, Bruyette & Woods have called on the crypto exchange to create other revenue sources. Coinbase can look to staking to monetize its already large customer base, according to the Wall Street analyst.

Although Coinbase said in its Q1 earnings call that it made about $10.3 million as staking revenue, Voigt believes the hype surrounding Ethereum’s migration to proof-of-stake (PoS) could net the exchange over $100 million in revenues in 2023.

Cryptocurrencies have grown in the last few months due to several reasons, namely their massive returns on investments and the growing belief that digital assets, like Bitcoin, are a store of value.

An announcement by electric car company Tesla Inc. on Feb. 28 saw a wider adoption of Bitcoin, subsequently leading to BTC surging beyond the $50,000 mark.

Bitcoin
Bitcoin Price in February

This momentous adoption saw more engagements with the crypto space, and the burgeoning industry became a trillion-dollar industry in just a dozen years.

Bitcoin has continued to surge, reaching a new all-time high of $65,000 before the market correction, and one of the beneficiaries of the bullish crypto run has been Coinbase.

Could Coinbase Stock Slide Further?

Coinbase may have risen on the wings of the Bitcoin boom, but the market sentiment seems to be taking a turn for the worse following Tesla’s BTC snub.

According to a Markets Insider report, many Bitcoin traders plan to short the world’s largest cryptocurrency. This has seen many Bitcoin traders assume bearish positions, predicting that the BTC price may fall below the $40,000 mark.

Data from bybt.com notes that over $3 billion worth of open interest in BTC put options are currently in the crypto market.

Put options signal more bitcoin selling pressure

Commenting on the market reaction, Pankaj Balani of crypto derivatives exchange Delta, noted that the growing volume of put options indicates pessimism on the general outlook of Bitcoin.

Even though crypto stalwarts like Square’s Jack Dorsey have come out to defend the embattled crypto asset, the continued decline in its price could see Coinbase’s stock price plummet alongside.

Speaking on Coinbase’s valuation, InvestorPlace’s Josh Enomoto noted that cryptocurrencies could not continue to support Coinbase’s market valuation.

He also pointed out that regulatory challenges could further see the company have a hard time in achieving its aim of becoming the biggest crypto exchange given its high fees.

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Coinbase Stock Keeps Falling – Is it a Sell Signal for Bitcoin?

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