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SPIRIT Blockchain – Weekly Wrap-up 11/25/2022

Here’s what happened in blockchain and crypto this week. As the dust settles following the FTX bankruptcy, crypto firms and industry participants are still assessing the damage on their businesses and the fallout on the industry as a whole, with the fate of some firms and funds potentially hanging by a thread. Unfortunately, the FTX contagion has rapidly spread to other crypto firms and crypto projects whose funds are stuck on the platform. To cushion the blow, Binance is now planning a $2 billion crypto recovery fund with contributions from Jump Crypto, Polygon Ventures and other firms. After the collapse of FTX triggered a sharp selloff in crypto markets fueled by high-profile bankruptcy fears, regulatory pressure and rampant short selling, prices of cryptoassets have largely stabilized.    Many industry participants have rightfully pointed out that contrary to popular opinion, the FTX collapse was not necessarily a crypto issue. Instead, it

SPIRIT Blockchain – Weekly Wrap-up 11/11/2022

Here’s what happened in blockchain and crypto this week. The liquidity crisis and bankruptcy of crypto exchange FTX sent shockwaves through the crypto industry this week. After the world’s largest trading venue Binance chose not to go ahead with a nonbinding offer to acquire the firm following a review of the company’s finances, FTX halted withdrawals and filed for Chapter 11 bankruptcy in the US this morning. FTX Group, which includes the entity, FTX US, Alameda Research and more than 100 affiliated companies have all filed for bankruptcy proceedings, according to a company press release. CEO and founder Sam Bankman-Fried resigned along with the firm’s institutional sales and legal teams. The headlines surrounding FTX triggered a sharp selloff in crypto markets, with Bitcoin dropping below $16,000 for the first time since 2020. The FTX contagion has rapidly spread to other firms and crypto projects associated with FTX.   While

SPIRIT Blockchain – Weekly Wrap-up 11/04/2022

Here’s what happened in blockchain and crypto this week. It has been another volatile week in financial markets. The US Fed hiked US interest rates by 75 basis points in line with expectations on Wednesday. More importantly, markets reacted to Jerome Powell’s speech which suggested that the central bank could raise the fed funds rate to a high of 5% or above before ending its current rate hiking cycle. The Fed chair clearly took a more hawkish approach in the news conference, stating that expectations regarding a potential pause would be “very premature” and that previous terminal rate projections were likely too low. After gaining initially during the Fed statement, stocks sold off while 2-year US Treasury Notes rose to above 4.7%. This morning, government bonds, equities and cryptoassets rebounded on the back of the release of the US October’s jobs report which showed ongoing resilience despite a slightly higher

SPIRIT Blockchain – Weekly Wrap-up 10/28/2022

Here’s what happened in blockchain and crypto this week. Global equities and cryptoassets look set to end the week on a strong note after a choppy session on Thursday amid weak tech earnings. Meta shares dropped by almost 25% and hit a 6-year low on Thursday while Amazon fell by 20% as both companies provided a weak outlook on Q4. Several macroeconomic indicators also came in weaker than expected this week, including US consumer confidence data and flash PMIs, signaling a more challenging economic environment. On the monetary policy front, both the the European Central Bank (ECB) and the Bank of Canada raised interest rates to the tune of 75 basis points and 50 basis points, respectively while the Fed is seen hiking to 5%. In other corporate news, Elon Musk’s $44 billion acquisition of Twitter was also in the spotlight this week, with the Tesla CEO immediately dismissing top

SPIRIT Blockchain – Weekly Wrap-up 10/21/2022

Here’s what happened in blockchain and crypto this week. The third-quarter earnings season kicked off this week, with major US banks such as JP Morgan, Wells Fargo and Citigroup reporting results. JP Morgan reported higher revenues, higher net interest income but also a 17% drop in net profits year-on-year (yoy) amid a tougher investment banking environment. Similarly, Wells Fargo missed analysts’ earnings estimates, with earnings down 31% yoy while it outperformed on the top line. As for non-financial earnings reports, investors are closely watching to which extent factors such as inflation, the strong US dollar, supply-chain issues and consumer spending will impact results and companies’ earnings outlook. Meanwhile, bond yields continued to move relentlessly higher, with the US benchmark 10-year note surging beyond 4.2%, the highest level since 2008. Elsewhere, the Bitcoin market is currently in a period of historically low volatility as BTC and ETH continue to consolidate into

SPIRIT Blockchain – Weekly Wrap-up 10/14/2022

Here’s what happened in blockchain and crypto this week. It has been another volatile week across global markets. Cryptoassets briefly tumbled on Thursday, with Bitcoin dropping to $18,370, amid a 40-year high in the U.S. core CPI reading. However, stocks and crypto staged a remarkable comeback later on in yesterday’s session, erasing most of the losses experienced earlier this week. After recovering by more than 4% from its Wednesday lows, the S&P 500’s choppy week continued on Friday, with US equities paring some of Thursday’s gains. Meanwhile, the ETH/BTC cross ratio continued to trend lower this week, hitting a multi-month low at 0.066 yesterday despite a reduction in ETH supply for the first time since the Merge.    US core inflation, which excludes food and energy, rose by 6.6% yoy in September while headline inflation came in at a hot 8.2% yoy, slightly higher than expected. While the elevated levels

SPIRIT Blockchain – Weekly Wrap-up 10/7/2022

Here’s what happened in blockchain and crypto this week. Risk assets look set to end the week on a weaker note amid a historic low in the U.S. unemployment rate, leaving the Federal Reserve on track to deliver yet another aggressive interest-rate hike. Major cryptocurrencies ended the week little changed despite one of the largest exploits in crypto history. Earlier this week, a bridge used in Binance’s BNB Chain was hit by a hack to the tune of $570 million of which $100 million was ultimately siphoned by the attacker (see story below). Bridges are tools that allow users to to transfer cryptoassets from one blockchain to another. Criminals have increasingly targeted them, with at least $2 billion stolen in more than 13 different hacks, according to Chainalysis data. Meanwhile, Bitcoin’s hashrate continues to soar, putting more pressure on miners.    On the upside, concerns surrounding a potential fallout from

SPIRIT Blockchain – Weekly Wrap-up 9/30/2022

Here’s what happened in blockchain and crypto this week. Equity markets had another choppy week, with U.S. stocks dropping to the lowest level since November 2020 amid the hawkish tone by Federal Reserve officials. In Europe, geopolitical events, weak eurozone PMI data and an expansionary Bank of England (BoE) triggered sharp losses in FX markets resulting in new multi-year lows of both the euro and the British pound vs. the U.S. dollar. After hitting a fresh 20-year high on Wednesday, the dollar index (DXY) has since cooled off somewhat, dropping from 114.8 to 112.2 on Friday. In the US, mortgage rates hit 16-year highs this week while house prices fell in July at the fastest rate in the history of the S&P CoreLogic Case-Shiller Index. In crypto markets, most assets posted small gains, with Bitcoin hovering below $20,000. Elsewhere, Fed Chair Jerome Powell said that the US central bank will

Webinar “Riding Bitcoin up to $100k” – 9/20/2022

SPIRIT Blockchain hosted a live webinar in collaboration with Crypto Finance highlighting the benefits of investing in Cryptoassets. Amongst other topics, we discussed how the current macro-economic environment is impacting on the Crypto industry. We were pleased with the large number of participants in the live webinar. For those who could not attend or if you want to listen to the presentations once more, please find the audio recording here:  

SPIRIT Blockchain – Weekly Wrap-up 9/23/2022

Here’s what happened in blockchain and crypto this week. We’re excited to announce that the common shares of Spirit Blockchain Capital Inc. began trading on the Canadian Securities Exchange under the ticker “SPIR” on September 14, 2022 (see also press release).   In crypto markets, the positive impact of Ethereum’s successful Merge on BTC and token prices turned out to be fairly short-lived as global macro factors and monetary policy took center stage again. The Fed’s recent 75 basis points rate increase and hawkish tone during the press conference resulted in choppy trading across financial markets. The risk off mode also toke its toll on Bitcoin, although BTC has outperformed ETH and is now forming a bottom price range similar to the previous crypto market cycle in 2018/2019.    After the successful completion of the Merge last week – Ethereum’s much-awaited transition from Proof-of-Work to Proof-of-Stake and probably one of

SPIRIT Blockchain – Weekly Wrap-up 9/16/2022

Here’s what happened in blockchain and crypto this week. Ethereum’s long-awaited “The Merge” – the transition from Proof-of-Work to Proof-of-Stake – was successfully completed in the early hours of Thursday morning. This means that the blockchain is no longer secured by miners but by validators that stake ETH under the new consensus mechanism. Equally important, the upgrade entails a reduction of more than 90% in both ETH inflation and energy use. In the long term, the upgrade will pave the way for significantly cheaper and faster transactions that will allow millions of users to transact on Ethereum. Meanwhile, the weakness in cryptoasset prices continues amid a renewed selloff in traditional financial markets triggered by higher than expected U.S. CPI data in August.    The Merge is a monumental event for the blockchain space, with many market participants referring to it as the most important moment in crypto history. Technically, coordinating

SPIRIT Blockchain – Weekly Wrap-up 9/9/2022

Here’s what happened in blockchain and crypto this week. After dropping to its lowest level since mid-June earlier this week, bitcoin bounced back on Friday. BTC has now gained more than 11% since its multi-month low on Wednesday. The recent bitcoin price weakness is also reflected in the ETH/BTC ratio which hit its highest level since late 2021 on the back of the ongoing ETH outperformance. With only one week to go before the Merge, investors have cheered the optimism surrounding the Ethereum 2.0 upgrade, piling into ETH and ETH-based funds. On the U.S. regulatory front, a slew of news around the White House, the Fed and the SEC made headlines this week with potentially far-reaching implications for Bitcoin mining, stablecoins and a large number of cryptoassets as unregistered securities. Overall, the crypto industry is likely to benefit from these developments, not least because they provide more regulatory clarity and

Ether outperforms Bitcoin on “The Merge” Optimism

After years of preparation and several delays the Ethereum blockchain’s most ambitious software upgrade so far is anticipated to take place next week. The Ethereum protocol is moving away from the energy-intensive “Proof of Work” (PoW) approach switching to “Proof-of-Stake” (PoS). The upgrade is one of the biggest events in the crypto industry in recent years and could attract fresh interest and capital inflows. During “the Merge”, the Ethereum mainnet merges with a separate PoS blockchain that was created in 2020 for Ethereum 2.0, called the Beacon Chain. Looking at the main implications for the crypto industry and investors, some key considerations stand out: Firstly, the Merge makes Ethereum more energy efficient. Under the current PoW consensus mechanism, Ethereum miners get rewarded in ether (ETH) for producing blocks using energy-intensive GPUs. After “the Merge”, i.e. the move to PoS, validators supporting the network will need to stake to produce blocks, moving completely away from mining. There are estimates that PoS is more than 1500 times more energy efficient than PoW.

SPIRIT Blockchain – Weekly Wrap-up 9/2/2022

Here’s what happened in blockchain and crypto this week. Bitcoin and cryptoassets look set to recoup most of their earlier losses this week in line with a rebound in global equities. Stocks rallied as today’s U.S. jobs report showed moderately higher unemployment that could ease hiking pressure on the Fed. The Bitcoin network’s mining difficulty bounced back this week, experiencing the biggest increase since January. Although this weighs on miner profitability given the ongoing weakness in the price of Bitcoin, some on-chain metrics suggest the worst could be behind for the mining industry. Bitcoin holders remain similarly unfazed. Despite the uncertainties brought about by the recent price drop below the $20,000 level, on-chain metrics show that the majority of holders have been using a very simple strategy for more than a year: “hodling”.    On Wednesday, the Bitcoin network’s difficulty rose by a whopping 9.26% amid a surge in hashrate.

SPIRIT Blockchain – Bitcoin Is Finding a Silver Lining

Things are looking up again for Bitcoin. The network’s mining difficulty has increased by 9.26% yesterday –  its biggest adjustment since January amid a rapid increase in the hashrate over the past two weeks. Elsewhere, some Bitcoin mining and on-chain metrics suggest the worst is behind for the mining industry. This is not to say that we’re in for a quick rebound in price yet. The current macroeconomic backdrop inevitably poses some challenges for Bitcoin since it hasn’t been immune to the weakness in risk assets and the global economic uncertainty. So we’re probably not out of the woods yet. Looking back, the bear market has been very challenging for publicly listed mining companies. The combination of lower BTC prices, rising network difficulty, higher energy prices and a more difficult financing environment, among other things, clearly impacted 2Q financial results and dampened their outlook. Many of these negative factors persist,

SPIRIT Blockchain – Weekly Wrap-up 8/26/2022

Here’s what happened in blockchain and crypto this week. While the fallout from the U.S. Treasury Department’s ban of coin mixing service Tornado Cash continues, U.S. lawmakers are weighing in. In an open letter, U.S. Congressman Tom Emmer requested to Janet Yellen and the Treasury that the department provide clarity on the legality and divergence from precedent of OFAC’s sanctions against the open-source software protocol. The ban made massive waves in recent weeks and led to the arrest of a software developer, the freezing of cryptoassets and banning of Ethereum addresses by large cryptoasset firms and DeFi protocols, among other things. It also caused an outcry in the crypto community since the ban entails far-reaching ramifications for financial privacy and freedom of speech.    First launched in 2019, Tornado Cash is an open-source blockchain protocol for sending and receiving anonymous transactions, also referred to as “mixing”.  According to blockchain analysis

SPIRIT Blockchain – Weekly Wrap-up 8/19/2022

Here’s what happened in blockchain and crypto this week. Cryptoasset prices ended the week lower, with bitcoin seeing one of the largest selloffs in recent weeks amid global macro headwinds, a hawkish U.S. Federal Reserve and weak crypto earnings reports. Wednesday’s release of the July FOMC meeting minutes reaffirmed the Fed’s position to raise interest rates and hold them at elevated levels to bring down inflation. Meanwhile, the fallout from the recent Celsius and Three Arrows Capital bankruptcies continues to weigh on both bitcoin and ASIC prices in light of potential sell pressure and forced liquidations from insolvent firms and miners.     As for publicly listed crypto firms, all eyes were on the earnings season this week. Bitcoin mining rig maker Canaan’s cautious outlook is a bellwether of current and future challenges faced by the bitcoin mining industry. The Beijing-based firm whose shares trade on the NASDAQ said tougher market

SPIRIT Blockchain – Weekly Wrap-up 7/29/2022

Here’s what happened in blockchain and crypto this week. Cryptoassets had a strong rebound, with both BTC and ETH reclaiming previous levels after a brief pullback mid-week. While it was another busy week in crypto-related deals, it was a more quiet, albeit not uneventful week in terms of headlines. A number of news articles shed some more light on filings and recent developments surrounding troubled crypto lenders and exchanges. Elsewhere, Coinbase faces an SEC probe on assets that should have been registered as securities, according to the agency. On a related note, Ark Investment Management – which had been bullish on Coinbase – revealed it had sold more than 1.4 million in the company’s shares.    More information on troubled crypto lenders and exchanges came to light this week (see also headlines below) including Asian firm Babel Finance which reportedly engaged in prop trading with customer funds. CoinDesk had another

SPIRIT Blockchain – Weekly Wrap-up 7/22/2022

Here’s what happened in blockchain and crypto this week. The skirmish between crypto companies and the U.S. Securities and Exchange Commission (SEC) continued this week. While the SEC asked the U.S. Congress for more resources to address current issues in the crypto ecosystem, its approach was criticized by both industry heavyweights and other regulators. The SEC also classified nine cryptoassets as securities as part of charges against a former Coinbase employee for alleged insider trading.    It was a busy week in crypto vs. SEC headlines, with the agency reiterating that it needs more resources to tackle cryptoasset issues. The head of the SEC’s enforcement unit, Gurbir Grewal, asked Congress for additional personnel – in the form of 125 more people – to shore up the agency’s crypto regulation efforts. On Tuesday, SEC chair Gary Gensler said on Bloomberg that he continues to see plenty of “noncompliance” across the industry. 

SPIRIT Blockchain – Weekly Wrap-up 7/15/2022

Here’s what happened in blockchain and crypto this week. “The Merge” – Ethereum’s long-awaited move to Proof-of-Stake – is coming soon, at least according to the projection of some of the network’s key community members. Ethereum developers suggested this week that the merge from Proof-of-Work (PoW) to Proof-of-Stake (PoS) could take place the week of September 19th during an update call. After weeks of bearish headlines for the crypto industry, the Merge event could be a positive catalyst for the ecosystem.    Core Ethereum developer Tim Beiko proposed September 19 as the tentative target date for the Merge in Thursday’s call. Later, Beacon Chain community manager superphiz.eth acknowledged that “This merge timeline isn’t final, but it’s extremely exciting to see it coming together” in a tweet. Prior to merging the mainnet with ETH 2.0’s Beacon Chain, a Merge dress rehearsal has been taking place in the form of several Ethereum

SPIRIT Blockchain – Weekly Wrap-up 7/8/2022

Here’s what happened in blockchain and crypto this week. Crypto markets had a fairly strong week, with bitcoin hitting its highest price in more than three weeks. BTC is now up more than 24% from its June 18 low when it dropped to about $17,600. Yet, many investors remain cautious and are closely watching whether BTC can reclaim key price levels such as the $23,000 resistance while also monitoring on-chain indicators to gauge the network’s fundamentals. Meanwhile, publicly-listed miners announced that they recently sold large amounts of their BTC treasuries. Elsewhere, the once fast-growing crypto lending industry continues to be in consolidation mode amid a number of potential acquisitions and bailouts.    Investors continue to monitor price levels to identify buying opportunities for bitcoin and other cryptoassets. Recently, BTC’s 200-week simple moving average (SMA) line has been a closely-watched trading indicator given that the price of bitcoin dropped below this

SPIRIT Blockchain – Weekly Wrap-up 7/1/2022

Here’s what happened in blockchain and crypto this week. The Securities and Exchange Commission (SEC) rejected yet another application for a bitcoin spot-based exchange-traded fund (ETF) on Wednesday. The agency denied Grayscale’s bid to convert its Grayscale Bitcoin Trust (GBTC) into a spot ETF. The move did not come as a surprise given that the SEC rejected over a dozen spot bitcoin ETF applications in the past while it approved several bitcoin futures-based ETFs. However, Grayscale subsequently announced that it would file a lawsuit against the watchdog. Grayscale manages about $12 billion in assets through its GBTC vehicle which holds roughly 3.3% of all bitcoin in circulation. The trust, which is supposed to track the price of bitcoin, is currently trading at a 30% discount to its net asset value (NAV). The existing discount was one of Grayscale’s primary arguments for why the transition needed to take place.    Last

SPIRIT Blockchain – Weekly Wrap-up 6/24/2022

Here’s what happened in blockchain and crypto this week. The ramifications of the recent crypto selloff continue to be felt across the sector. Reports on potential contagion effects of the previous weeks’ developments came thick and fast this week. Market participants were particularly concerned about spillover risks from troubled crypto firms Celsius and Three Arrows Capital to other crypto lenders, and potentially the crypto sector as a whole. To prevent further loss of confidence, crypto exchange FTX stepped in this week by providing liquidity to embattled crypto firms BlockFi and Voyager Digital, essentially bailing them out.    The large drawdown in cryptoasset prices continues to have ripple effects on the industry, particularly on some of the crypto lenders and brokerage firms. To prevent further contagion, FTX and Alameda Research founder Sam Bankman-Fried (SBF) decided to provide credit lines and financing to BlockFi and Voyager, respectively. SBF tweeted that “We take

SPIRIT Blockchain – Weekly Wrap-up 6/17/2022

Here’s what happened in blockchain and crypto this week. Higher interest rates and the inflationary environment continue to weigh on markets amid a global repricing of risk assets. U.S. equities experienced sharp losses this week amid a more hawkish Federal Reserve which raised interest rates by 75 basis points on Wednesday. It was another difficult week in crypto markets, with a selloff in BTC and ETH bringing two major crypto firms to the brink of collapse. Crypto lender Celsius halted client withdrawals on its platform while crypto trading firm Three Arrows Capital also appears to be hanging by a thread. While the industry is preparing for a potential crypto winter, a number of market participants such as Galaxy Digital’s Mike Novogratz suggested that crypto could be much closer to the bottom than global equities. Despite the recent woes, dealflow momentum is unchanged with crypto startups continuing to raise tens of

SPIRIT Blockchain – Weekly Wrap-up 6/10/2022

Here’s what happened in blockchain and crypto this week. There is a broad consensus among market participants that cryptoassets have entered a bear market. While tokens across the board have seen continued drawdowns in prices, new data indicates that metaverse items have been more resilient despite a drop in trading volumes. A new report suggests that NFTs have weathered the bear market so far amid ongoing momentum surrounding the blockchain-related virtual worlds, gaming and profile picture projects.    A recent blockchain industry report by DappRadar provided a number of interesting insights, showing that the NFT market generated $3.7 billion in May – a 20% drop from the USD volumes registered in April. On the upside, Yuga Labs’ Otherside metaverse NFTs reached $750 million in trading volume, propelling virtual worlds to their best month with over $850 million in May.    Elsewhere, a slowdown in blockchain gaming investments (see also deal

SPIRIT Blockchain – Weekly Wrap-up 6/3/2022

Here’s what happened in blockchain and crypto this week. Stablecoins are in global regulators’ crosshairs again after the recent TerraUSD collapse. The algorithmic “cryptodollar” which was supposed to be linked to the U.S. dollar lost its peg and sent shockwaves through the crypto market last month. This week, Japan became the first major country to introduce a legal framework around stablecoins pegged to sovereign currencies. Elsewhere, the U.K. government proposed amending existing rules to manage the failure of stablecoin firms that may pose a systemic risk.   Bloomberg reports that Japan’s parliament passed a bill on Friday that clarified the legal status of stablecoins, defining them essentially as digital money. According to the legislation, stablecoins must be linked to the yen or another legal tender and guarantee holders the right to redeem them at face value. The legal definition effectively means stablecoins can only be issued by licensed banks, registered

SPIRIT Blockchain – Weekly Wrap-up 5/27/2022

Here’s what happened in blockchain and crypto this week.  G7 policymakers met in Berlin last week to discuss crypto regulation, among other things, in the wake of the collapse of the UST stablecoin. This week, the European Central Bank (ECB) released a report on crypto’s risk to financial stability, warning of potential systemic risks. Meanwhile, ECB President Christine Lagarde harped on the same string, arguing on Dutch television that cryptoassets are “based on nothing” and that the digital euro will be a safer store of value.  Not surprisingly, in its report titled “Decrypting financial stability risks in crypto-asset markets” which is part of the its twice-yearly Financial Stability Review, the ECB emphasized the danger posed by the increasing integration of crypto with traditional finance. The central bank stresses the importance of gaining a better understanding of the potential risks surrounding cryptoassets and the need to close regulatory and data gaps in the

BIGG Digital Assets offers The World’s First 8-hour Online Certification Course for Cryptocurrency Investigations Developed by Investigators

The course was originally developed for and qualified by US law enforcement. BIGG Digital Assets (“BIGG”) is a leading provider of crypto solutions with which authorities can trace and track criminal activities utilizing cryptocurrency. Using different methods and technologies, and by bridging the solution focused software products of both BIGG and Spirit Blockchain Capital (“SPIRIT”), it is now become easier to examine payment flows and monitor the exchange of cryptocurrencies to detect possible criminal activity. This solution-based technology has proven itself to be immensely valuable to the US government, law enforcement and its agencies. With lucrative opportunities to expose nefarious activities and with price conscious budgets in mind these crime fighting solutions work hand in hand. Detection of suspicious activities Modern technologies now enable law enforcement, RegTech, and regulatory and government agencies to follow the virtual money. Search algorithms aid in detecting suspicious activity within transactions involving e.g. Bitcoin, Ethereum,