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  • Xapo Bank partners with Hilbert Group to launch $200m Bitcoin hedge fund

    Xapo Bank partners with Hilbert Group to launch $200m Bitcoin hedge fund

    • Xapo Bank and Hilbert Group will launch a Bitcoin-denominated hedge fund.
    • The BTC fund will receive an initial investment of $200 million from Xapo and other investors.

    Xapo Bank is teaming up with Hilbert Group to launch a Bitcoin (BTC)-denominated hedge fund, according to a press release on Aug. 27.

    In the announcement, Hilbert Group said the strategic partnership will involve its asset management arm Hilbert Capital and see an initial investment of over $200 million from Xapo as well as other investors.

    “Over the last 12 months, we have developed a close and strategic partnership with Xapo Bank, a veteran in the Bitcoin space and a tier-one financial institution in the digital asset space,” Niclas Sandström, CEO of Hilbert Group, said.

    He added, “Given the investment opportunity and the quality and experience of the team, we anticipate that the Fund will grow meaningfully over the next year.

    Fund to offer exposure to Bitcoin

    The newly-established BTC-denominated hedge fund will launch in September, Hilbert Group revealed in the press release. Corporates, businesses and professional investors will leverage the new fund to generate returns in bitcoin. The fund will offer institutional-grade credit arrangements that investors don’t get through direct market participation.

    Notably, the BTC-denominated fund will have fees lower than the 2% and 20% Hilbert’s other hedge funds charge.

    “We believe that offering the right products for participants in the space who are aiming not only for exposure to the Bitcoin price, but also structured ways to grow the Bitcoin value of those investments is a natural evolution of the asset class,” Joey Garcia, director of Xapo Bank commented.

    Hilbert, founded in 2018, primarily focuses on asset management of algorithmic trading strategies.

    The company also invests in blockchain and crypto related projects. Investments in the space include crypto data platform Coin360, blockchain-based self-service SaaS tool CapChap and HAYVN, a digital assets trading and custody platform.

    Meanwhile, Xapo is the first Bitcoin-enabled bank that integrates fiat with crypto. It recently announced its entry into the UK.

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  • M2 crypto exchange to allow UAE residents to trade crypto using bank accounts

    M2 crypto exchange to allow UAE residents to trade crypto using bank accounts

    M2 crypto exchange to allow UAE residents to trade crypto using bank accounts
    • M2 enables UAE residents to trade BTC and ETH directly with bank accounts.
    • Integration supports dirham deposits, withdrawals, and market-responsive trading.
    • UAE has strict regulations to ensure consumer protection and market transparency.

    In a significant development for the digital asset market in the United Arab Emirates (UAE), M2, a prominent crypto exchange, has announced that UAE residents can now buy and sell Bitcoin (BTC) and Ethereum (ETH) directly using their bank accounts.

    This new integration facilitates the direct conversion of UAE dirhams into BTC and ETH through M2’s spot market, marking a milestone in the accessibility of virtual assets in the region.

    M2 users can seamlessly convert dirhams into BTC and ETH and vice versa

    In an announcement shared with Cointelegraph, the M2 exchange highlighted that the new feature will enable users to convert dirhams into Bitcoin and Ether seamlessly through the trading pairs listed on M2’s spot markets.

    Additionally, the platform supports the deposit and withdrawal of dirhams, offering users greater flexibility in managing their assets.

    The M2 team emphasized that this integration would enable users to “swiftly adapt to market changes,” allowing them to easily convert their local currency into crypto.

    This is particularly beneficial for everyday investors who may not be fully immersed in the complexities of the trading environment.

    According to M2, the higher levels of familiarity and significant trading volumes of BTC and ETH make these cryptocurrencies ideal entry points for new investors looking to enter the digital asset space.

    UAE has the strictest regulatory framework globally

    Regulated by the UAE government, which is known for its stringent consumer protection measures, this move reflects the country’s commitment to safeguarding its residents in the evolving crypto landscape.

    The UAE has established a reputation for having one of the strictest regulatory frameworks globally, prioritizing consumer protection. In 2022, Dubai’s Virtual Asset Regulatory Authority (VARA) mandated greater transparency in crypto advertisements to better protect consumers.

    Moreover, in 2023, the UAE introduced a federal law aimed at preventing fraud in the crypto market, imposing fines of up to 10 million AED ($2.7 million) for violations.

    Commenting on the integration, Kimmel, an executive at M2, noted that the ADGM’s licensing process was demanding due to its high standards for multilateral trading facility permits. However, he affirmed that this rigorous due diligence ensures that licensed platforms meet the country’s security and transparency standards, thereby fostering trust among UAE users.

    Despite the challenges associated with the licensing process, the UAE continues to be a strategic region for the crypto industry.

    Favourable tax policies, access to global markets, and a safe environment for innovation make the UAE an attractive destination for crypto businesses.

    This new development by M2 is set to further enhance the accessibility and appeal of virtual assets in the UAE, making it easier for residents to participate in the burgeoning crypto market.

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  • Ex-Deutsche Bank investment banker faces up to 30 years behind bars

    Ex-Deutsche Bank investment banker faces up to 30 years behind bars

    • The former Deutsche Bank employee, Rashawn Russell, was arrested in April 2023.
    • Russell is accused of causing at least 29 investors to lose not less than $1.5 million.
    • Russell fabricated multiple documents and misled investors regarding the status of their investments to orchestrate his scheme.

    Rashawn Russell, formerly employed as an investment banker at Deutsche Bank, has admitted his guilt in connection with allegations of embezzling funds from investors enticed by promises of substantial returns from cryptocurrency trading, as confirmed by the US Justice Department. The news comes right on the heels of Deutsche Bank tapping Swiss crypto firm Taurus for crypto custody services.

    This plea comes on the heels of Russell’s arrest in April, which implicated him in an intricate fraudulent operation. He now confronts the possibility of a prison sentence of up to 30 years, in addition to the obligation to reimburse investors with a sum exceeding $1.5 million.

    Why was Rashawn Russell arrested?

    US Attorney Breon Peace issued a statement in which he remarked:

    “Russell exploited the fascination of investors in cryptocurrency markets to orchestrate a deception against trusting clients.” He further emphasized, “The expeditious conviction in this instance underscores our commitment to holding those engaging in deceitful practices within the digital asset sector accountable.”

    Details unveiled during the plea hearing, in conjunction with court records, reveal that between November 2020 and August 2022, Russell, who formerly worked as an investment banker and was registered as a broker with the Financial Industry Regulatory Authority, played a pivotal role in an intricate fraudulent endeavour. He duped investors into investing their capital into his R3 Crypto Fund by offering false assurances of substantial, at times guaranteed, profits stemming from cryptocurrency ventures.

    In reality, a significant portion of the investors’ finances was diverted by Russell for personal enrichment, gambling, and repaying previous investors. As a result of this deceitful operation, at least 29 investors suffered losses that amounted to no less than $1.5 million.

    Fabrication of documents and misleading investors

    As part of the fraudulent scheme, the Justice Department revealed back in April that “Russell fabricated multiple documents and misled investors regarding the status of their investments.” At one juncture, Russell purportedly sent an investor a doctored image of a bank statement supposedly sourced from a bank’s website, falsely indicating the availability of substantial liquidity. In another instance, when an investor sought to retrieve their investment, Russell neglected to transfer the funds and instead dispatched a counterfeit bank wire transfer confirmation to the investor, falsely suggesting the return of their capital.

    According to the April indictment, Russell’s duplicitous ploy targeted “numerous individuals, including his friends, former college classmates, and former colleagues at a financial institution,” the specific identity of which has been made known to the Grand Jury.

    Russell’s LinkedIn profile, which has since been deleted, disclosed his employment history at JP Morgan, Moody’s, and Deutsche Bank, where he commenced his career as a banking analyst in July 2018, ultimately advancing to the position of associate in July 2020.

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  • Bitcoin, Ether prices up as stocks tank on new bank fears

    Bitcoin, Ether prices up as stocks tank on new bank fears

    • Bitcoin (BTC) and Ethereum (ETH) prices rose nearly 2% respectively as stocks plunged.
    • The S&P 500 was down 1.5% as two bank stocks plummeted.
    • BTC and ETH gains saw altcoins in the top 10 cryptocurrencies by market cap up.

    Bitcoin (BTC) price moved above $28,500 again on Tuesday, rising more than 2% in early morning trades during the US trading session. The upside was yet another attempt by Bitcoin bulls to establish a fresj footing in the key price range.

    Elsewhere, the price of Ethereum (ETH) rose above $1,860 to hit a new 24-hour high as crypto spot markets climbed. The Ether token was 1.9% up at the time of writing, gains that were being mirrored across the top 10 cryptocurrencies by market cap list.

    BTC and ETH have traded to year-to-date highs above $31,000 and $2,100 respectively.

    Stocks tank on bank fears

    US stocks opened lower on Tuesday as stock prices of another two US banks plunged amid the latest turmoil in the banking sector. The S&P 500 was down 1.5% while Nasdaq was shedding 1.3%.

    After share prices of First Republic Bank fell in the lead up to its takeover by JPMorgan, Tuesday saw prices of Pacwest (PACW) and Western Alliance (WAL) stocks bleed massively.

    At about 12:30 pm ET, the PACW and WAL share prices were down 26% and 20% respectively.

    The two bank stocks had plummeted more than 30% earlier as investor concerns around the turbulence within the US banking system resurfaced following the losses that followed the collapse of Silicon Valley Bank.

    Also on investors’ minds this week is the Fed’s meeting that kicked off on Tuesday. While the market has the anticipated 25bps interest rate hike baked in for after the FMC meeting, what the central bank says in relation to what next is seen as key.

    Economist Mohamed A. El-Erian, commented on the market outlook, stating via a tweet:

    “The roller coaster continues with, this time around, a 20 bps drop in the yield on 2-year Treasuries.  With such a key market segment continuing to be in urgent need of stabilization, it remains to be seen if the Fed serves this function tomorrow or, instead, is again a source of volatility.”

    Barry Knapp of Ironsides Macroeconomics says the Fed’s approach to the inflation question is fraught and dubious. The central bank has to consider what the market is telling it. He shared his views in an interview with CNBC’s Squawk Box.

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  • MicroStrategy repays Silvergate Bank loan, buy 6,455 BTC

    MicroStrategy repays Silvergate Bank loan, buy 6,455 BTC

    • MicroStrategy founder Michael Saylor announced the company had repaid the $205 million loan at a 22% discount.
    • The company also bought 6,455 bitcoins worth $150 million.
    • Saylor’s company currently holds more than 138,900 bitcoins.

    MicroStrategy, the world’s largest corporate holder of Bitcoin, has revealed it recently purchased more BTC. 

    The business intelligence company, founded by Bitcoin bull Michael Saylor, also announced on Monday that it had repaid the loan to the failed crypto-friendly bank Silvergate Bank.

    MicroStrategy repays $250 million loan, buys 6,455 BTC

    Saylor, referencing his company’s latest SEC filing, said that MicroStrategy has now fully repaid the $205 million loan it borrowed from Silvergate in March 2022. The company reportedly cleared the loan principal with a 22% discount, with Friday’s payoff seeing MicroStrategy clear the collateralized loan at $160 million.

    As a result, the company recouped its 34,619 BTC that had been pledged as collateral.

    MicroStrategy also confirmed the purchase of 6,455 BTC, acquired for a total of $150 million and at an average $23,238 a coin. Saylor’s bitcoin strategy now includes a total Bitcoin haul of 138,955 BTC since the company’s first move in 2020. 

    So far, the total BTC holdings have been acquired at a cost of $4.1 billion, with each bitcoin purchased at the average price of $29,817.

    Bitcoin currently trades around $27,809 while MicroStrategy shares closed at $256.67 on Friday and were 0.07% down at 9.10 am ET ahead of US markets opening on Monday.

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