Cryptocurrency Hedge Fund Headed by Ex-Goldman Sachs VP Raises $140 Million

Cryptocurrency Hedge Fund Headed by Ex-Goldman Sachs VP Raises $140 Million

It looks as if Silicon Valley and Wall Street are coming together just to see who can shower cryptocurrency ventures with more money.

Also Read: Strong Cryptocurrency CFD Volumes Bring Record Revenues for Plus 500

Blocktower Capital Crypto Hedge Fund

Cryptocurrency Hedge Fund Headed by Ex-Goldman Sachs VP Raises $140 MillionBlocktower Capital is a cryptocurrency hedge fund headed by former Goldman Sachs vice president Matthew Goetz. The new venture was only launched in August 2017 and has already said to have raised about $140 million.

Investors in Blocktower reportedly include family offices and other entities such as venture capital firms such as Union Square Ventures LLC and Andreessen Horowitz.

Some of the raised funds were apparently redirected towards boosting the company’s staff, now estimated to sport eight executives. On Thursday Blocktower issued a statement that it hired Michael Bucella, who was also with Goldman Sachs since 2008. Bucella’s last role at the bank was related to multi-asset sales in Canada, where he headed strategic partnerships and business development.

Alpha Potential Is Abundant

Cryptocurrency Hedge Fund Headed by Ex-Goldman Sachs VP Raises $140 MillionOn its sparse website Blocktower Capital’s only description of its investment strategy, goals or operation is “bringing professional trading and portfolio management to an emerging digital asset class.” There is no mention of what cryptocurrencies they will focus on for trading, as well as whether they will invest in ICO tokens or stocks of any ‘blockchain’ companies.

However, CEO Goetz, described what is the opportunity the fund can capitalize on: “It’s a wildly inefficient market where alpha potential is abundant — more than anything we’ve seen in our careers. We think it’s a rare opportunity for investors. It’s not often there’s a new capital market being born in front of you.”

This sentiment appears to be shared among more and more investors in both the finance and the venture capital worlds. A few notable examples include legendary value investor Bill Miller who now holds half of his hedge fund in bitcoin, TechCrunch and CrunchFund founder Michael Arrington‘s $100 million XRP hedge fund, billionaire investor Michael Novogratz and most recently Peter Thiel’s Founders Fund.

Would you invest in a cryptocurrency hedge fund run by former ex-Goldman Sachs executives? Tell us what you think in the comments section below.


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People Selling ‘Fully Verified’ Crypto-Exchange Accounts On the Rise

People Selling 'Fully Verified' Crypto-Exchange Accounts On the Rise

Over the past few months, cryptocurrency exchanges across the globe have been swamped with new customers looking to trade or acquire digital assets. Trading platforms have been having a hard time keeping up with the new registrants. Users are complaining that identity verifications are now required and take weeks to process, while some exchanges are not accepting new customers at all. This has led to rise of individuals selling “fully verified” accounts for a variety of popular digital currency platforms.

Also Read: Several Bitcoin Exchanges Are Closing Their Doors to New Traders

As Exchanges Stop Accepting New Registrants and Require More Identity Verification — A Great Number of Fully Verified Accounts Are Being Sold for Bitcoin   

Just recently news.Bitcoin.com reported on how some exchanges like Bittrex, and Cex.io have temporarily stopped accepting new customers due to the heavy influx of registrants these days. Further, we reported on how one of the leading trading platforms, Binance, disabled new user accounts a few days ago. Meanwhile, in December Poloniex announced it required legacy accounts to verify their identity or the accounts would be closed. All of these issues has led to significant verification delays, and people finding it more difficult to trade cryptocurrencies. However, some individuals are selling “fully verified” cryptocurrency exchange accounts for bitcoin and other digital assets.

People Selling 'Fully Verified' Crypto-Exchange Accounts On the Rise
Poloniex and Bittrex accounts for sale this week on the forum Bitcointalk.

Verified Accounts Lead to Much Larger Withdrawal Limits

People Selling 'Fully Verified' Crypto-Exchange Accounts On the Rise
One user is selling accounts on the Selly platform.

For instance, there are many examples of people selling accounts on forums over the past few months. On Bitcointalk.org one user is selling a Poloniex Verified Account (Level 3 Verified) that comes with a  $25,000 daily withdrawal limit for $12. The same person is also selling a Bittrex enhanced account for $10. Verified accounts have been for sale for years, but these days the amount of people selling them has increased significantly. Just last week another individual was selling a Bittrex account with “proof” on the Selly platform, and announced the sale multiple times on forums stating;

Hello guys, I’m selling a Bittrex verified account with a daily withdrawal limit 100 BTC.

The Frustrating Verification Process Has Led to the Blowback of Underground Sales

Having your identity verified on exchanges is pretty much a requirement for over 90 percent of the trading platforms online, no matter which country you live in. Even exchanges that used to have very little verification requirements, like BTC-e, have changed to fully regulated platforms requiring KYC/AML. In order to get verified, users often have to upload a state-issued license, verify their phone number, and even submit various papers that show your residential address. With all these requirements many users get frustrated and won’t even sign up for an exchange. If they do register their identity, they wind up waiting a long time and even weeks on end.

People Selling 'Fully Verified' Crypto-Exchange Accounts On the Rise
People are selling verified accounts on Telegram.

In addition to these posts found on forums account dealers are also selling verified accounts on messenger apps like Telegram. Cryptocurrency groups on Telegram in particular have various individuals selling accounts to Poloniex, Bitstamp, Bittrex, GDAX, Binance, and many more exchanges. With governments making it more difficult for exchanges to operate without abiding by KYC/AML background checks comes with some blowback — The rise of underground verified cryptocurrency exchange account sales.

It’s safe to say purchasing one of these accounts is really not the smartest move, as the seller could easily hold some credentials to the account and unload the user’s funds when the person least expects it.

What do you think about the number of people selling fully verified accounts for cryptocurrency exchanges? Let us know in the comments below.

Disclaimer: Bitcoin.com does not endorse nor support the product or service where people are selling verified accounts. The links provided in this article are for source purposes only and news.Bitcoin.com does not recommend or consider these account vendors trustworthy.  
Readers should do their own due diligence before taking any actions related to the mentioned links or any of the vendor’s services. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images via Shutterstock, Bitcointalk, Selly, and Telegram.


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Korean Government Starts Inspecting Major Banks for Crypto Regulation Compliance

Korean Government Starts Inspecting Major Banks for Crypto Regulation Compliance

The South Korean authorities will start inspecting major banks for their compliance with cryptocurrency regulations on Monday. This move follows the regulators’ recent announcement prohibiting the use of virtual bank accounts for anonymous trading.

Also read: Russian Regulators Draft Law to Restrict Crypto Mining, Payments, and Token Sales

Inspecting 6 Major Banks

Korean Government Starts Inspecting Major Banks for Crypto Regulation ComplianceThe South Korean Financial Intelligence Unit (FIU), under the Financial Services Commission (FSC), and the Financial Supervisory Service (FSS) said on Sunday, January 7, that they will jointly inspect 6 major banks for compliance of cryptocurrency regulation.

The inspection will take place between January 8 and 11. Woori Bank, KB Kookmin Bank, Shinhan Bank, Nonghyup Bank, Korea Development Bank (KDB), and Industrial Bank of Korea (IBK) will be inspected.

This move follows the government’s clampdown on the use of virtual accounts for anonymous trading at the end of last month, as news.Bitcoin.com previously reported. Financial News described:

The FIU and FSS will check whether banks have properly implemented their anti-money laundering obligations to operate virtual accounts…The FIU has imposed more than 40 checklists on suspicious transactions, stipulating virtual currency as a ‘high risk’ transaction.

The Korea Herald commented, “It is rare for the two organizations to conduct a joint survey, a move that industry watchers viewed as beyond a watch on anti-money laundering measures by the banks and ultimately intended to cool the overheated market.”

Real-Name System Expected Around Jan 20

Korean Government Starts Inspecting Major Banks for Crypto Regulation ComplianceLast week, the FSS revealed that the amount of fiat deposits at crypto exchanges as of December 12 last year amounted to 2.067 trillion won [~USD$1.95 billion]. Furthermore, 111 virtual bank accounts were detected at the six aforementioned banks at the end of December, the news outlet detailed.

In an effort to end anonymous trading, the government has prohibited banks and crypto exchanges from both issuing new virtual accounts and adding new members to existing ones, as news.Bitcoin.com previously explained.

The government is developing a real-name identification system which is expected to be introduced around January 20. Joongang Daily elaborated:

The real name confirmation service that banks are building by the end of this month is a method of allowing deposits and withdrawals only when the account of the trader who is identified and the account of [the trader at] the virtual currency exchange are the same.

What do you think of the government inspecting major banks for crypto regulation compliance? Let us know in the comments section below.


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Coinbase Withdrawal Delays Leave Users Frustrated, Crying Foul

Coinbase Withdrawal Delays Leave Users Frustrated, Crying Foul

When you are dealing with platforms that are supposed to be the on-ramps to the money of the future it’s hard to accept worse performance than the systems of the past. Unfortunately, this an issue plaguing all major cryptocurrency exchanges at the moment with Coinbase being one of the leading examples right now.

Also Read: Binance Exchange Disables New User Registrations

Coinbase Delays

Coinbase Withdrawal Delays Leave Users Frustrated, Crying FoulSan Francisco-based cryptocurrency exchange Coinbase is experiencing several disruptions to its normal business operations. According to the company’s status page, it is now facing transactions delays, wire processing delays and ID verification delays. Coinbase also reports users are getting degraded performance for both bitcoin (BTC) and ethereum (ETH).

The Coinbase team blames all these problems on high traffic, high volumes and a need to cope with a backlog of transactions. This is in common with other exchanges all around the world who say they can’t handle the massive influx of new traders without causing operational problems. Also similar to the other trading venues, the Coinbase team promises they are working on adding additional resources to optimize their systems to scale.

Users Frustrated

Coinbase Withdrawal Delays Leave Users Frustrated, Crying FoulWhile the Coinbase team is working on fixing the current issues and upgrading the exchange’s ability to handle more traffic in the future, users are going public with their suffering. The Coinbase Reddit forum is dominated by complaints regarding very long delays and a lack of proper answers for support. A few posters updated that the company processed their transactions only after they got a considerable amount of attention, suggesting it was done as a PR move.

In general, users are calling on the company to take stronger actions to resolve the situation, and chief among those to halt new client registrations were recently done by Binance, CEX.IO, Bitfinex, and Bittrex. Some higher profile members of the bitcoin community have even taken to social media to threaten Coinbase with legal actions if their concerns are not met.

Coinbase Withdrawal Delays Leave Users Frustrated, Crying Foul

Have any recent exchange issues affected your trading? Let us know in the comments section below.


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Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

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Wall Street Wants Bitcoin ETFs with Twice the Risk/Reward

Wall Street Wants Bitcoin ETFs with Twice the Risk/Reward

The US Securities and Exchange Commission (SEC) received yet another request to approve Wall Street bitcoin exchange-traded funds (ETFs). This time, the New York Stock Exchange (NYSE) wishes to list five new ETFs, so-called leveraged and inverse funds which increase risk and reward.

Also read: African Central Banks Urged to Ditch Dollar and Buy Bitcoin

Wall Street Wants Bitcoin ETFs with Twice the Risk/Reward

Wall Street Goes Short, Gets Bear, with Proposed Risky Bitcoin ETFs

The trope for years has been bitcoin’s volatility, risk, is too great for the sober adults of professional finance to be bothered. That myth was thoroughly smashed on 4 January 2018 when the NYSE Arca filed a fifty page request with the SEC. Wall Street wants Direxion Asset Management’s five ETFs, known as leveraged or inverse funds. The proposed funds up the risk level by twice, in either direction, and are short term investments. They’re easily some of the riskiest funds put forward.

ETFs are prized because they’re traded like stocks with the muscle of mutual funds. The SEC has yet to approve bitcoin ETFs, and applications for rule-changes are stacking up. Some estimates have requests for the cryptocurrency to be formally listed at nearly a dozen. This year enthusiasts will learn the financial product’s fate, most experts believe.

Direxion is presently asking five funds be listed: Direxion Daily Bitcoin Bear 1X Shares, Direxion Daily Bitcoin 1.25X Bull Shares, Direxion Daily Bitcoin 1.5X Bull Shares, Direxion Daily Bitcoin 2X Bull Shares, and Direxion Daily Bitcoin 2X Bear Shares. If approved they’d trade on the NYSE’s Arca market. Investors could see their returns as much as double; they could also see losses compound in the other direction just as fast. 

Wall Street Wants Bitcoin ETFs with Twice the Risk

Twice as Fast in Either Direction

The funds aren’t necessarily tethered to bitcoin’s spot price, but are instead a way to track bitcoin futures on markets such as those created by NYSE rivals Cboe and CME, with “investment results (before fees and expenses) that correlate positively to either 125%, 150%, or 200% the daily return of the target benchmark,” according to the filing.Wall Street Wants Bitcoin ETFs with Twice the Risk

That assumes a bull market, but, again, losses are multiplied as well which logically means these are for short term investing (longer options are available). ETFs would bring even more mainstreaming to bitcoin with regard to the broader investment community.

It’s a curious move, but the risks are sure to attract investment. One would assume the natural bitcoin price spikes would be enough for adrenaline junkies. But there is still widespread skepticism and worry about actually owning and holding bitcoin among Wall Street types. Nevertheless, such short-term volatility is something many traders value. Indeed the filing insists the Direxion ETFs “enhance competition among market participants, to the benefit of investors and the marketplace.”

What do you think of bitcoin ETFs? Let us know in the comments section below.


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