#bitcoinbacked

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Tokyo-listed Bitcoin treasury company Metaplanet has drawn another $130 million in Bitcoin-backed credit, expanding its use of collateralized borrowing to accelerate BTC purchases, income-generation strategies and potential share buybacks. On Tuesday, Metaplanet disclosed it executed the loan on Friday under a previously announced credit facility. The borrowing forms part of the company’s $500…

Lava, a global platform for bitcoin-backed loans, today announced a $200M funding round and the launch of a new product, a bitcoin line of credit (BLOC). The product offers similar functionality to a securities-backed loan or home equity line of credit, but allows users the ability to flexibly borrow using bitcoin as collateral without the monthly payments or term limits common in the…

Bitcoin Magazine21bitcoin Launches Europe’s First Pilot Bitcoin-Backed Lending Product Austrian Bitcoin platform 21bitcoin has teamed up with VR Bank Bayern Mitte eG and Sopra Financial Technology GmbH to launch a pioneering European pilot project in hopes to develop an institutional-grade Bitcoin-backed credit product. The project hopes to enable banks and financial service providers to offer…

Coinbase (COIN) said its bitcoin-backed loan program has surpassed $1 billion in originations since launching in January, underscoring growing demand for crypto as collateral. The exchange currently offers retail customers in the U.S. the ability to borrow cash against BTC$114,272.90 holdings through the on-chain Morpho platform. A spokesperson said the average loan size sits at $54,000 but noted…

RFK Jr. Pledges Support for Bitcoin-Backed Dollar and Tax Exemption for BTC

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Image Source: Twitter

US Democratic presidential candidate Robert F. Kennedy Jr. has said he is in favor of a tax exemption on Bitcoin (BTC), while also unveiling a plan to partly back the US dollar with “real, finite assets” like Bitcoin.

“Like Singapore, Germany, Switzerland, Puerto Rico and Portugal, a Kennedy administration will exempt the conversion of Bitcoin to the US dollar from capital gains taxes,” Kennedy said.

He explained that although he believes there are downsides a allowing Bitcoin holders to convert their coins to fiat tax-free, the advantages of such a policy would outweigh the disadvantages.

“The benefits include facilitating innovation and spurring investment, ensuring citizen privacy, incentivizing ventures to grow their business and tech jobs in the United States rather than in Singapore, Switzerland, Germany and Portugal,” the Democratic party outsider said.

Backing the dollar with Bitcoin

The presidential candidate and nephew of former US President John F. Kennedy further said that he would support backing the US dollar and US Treasury bills with hard assets, such as Bitcoin.

“A Kennedy administration will begin to back the US dollar with real, finite assets, such as gold, silver, platinum and Bitcoin,” Kennedy, who in a June poll received higher favorability rating than both Biden and Trump, said.

He went on to call Bitcoin specifically “the world’s hardest liquid asset.”

The candidate said he would start “very, very small,” with around a 1% backing for Treasury bills with assets like gold, silver, platinum or Bitcoin.

“Depending on the outcome, we would increase that annually,” he added.

“Backing dollars and U.S. debt obligations with hard assets could help restore strength back to the dollar, rein in inflation and usher in a new era of American financial stability, peace and prosperity,” Kennedy said.

Pro-Bitcoin presidential candidate

Robert F. Kennedy has previously been revealed as a Bitcoin holder, with financial documents from June showing that he holds between $100,001 and $250,000 worth of BTC in a brokerage account.

He has also spoken favorably about Bitcoin in the past, calling it a “bulwark against totalitarianism and the manipulation of our money supply.”

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MicroStrategy bought $209M in Bitcoin in Q1 2023; repaid Bitcoin-backed loan to Silvergate

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MicroStrategy continued to invest in Bitcoin over the previous quarter, as indicated by the company’s financial results on May 1.

Phong Le, MicroStrategy President and CEO, said

“The conviction in our bitcoin strategy remains strong as the digital asset environment continues to mature.”

MicroStrategy said that, in the first quarter of 2023, it purchased 7,500 BTC to add to its balance sheet. That amount is worth $209 million at current market rates.

This purchase increased Microstrategy’s total Bitcoin holdings to 140,000 BTC. Though the current market value of that total is $3.9 billion, MicroStrategy noted that the amount’s carrying value is $2.0 billion due to cumulative impairment losses.

MicroStrategy executive chairman Michael Saylor also highlighted on Twitter that his company’s Bitcoin strategy had outperformed stocks, indices, and even Bitcoin itself.

MicroStrategy also said that it paid $161 million to Silvergate Bank to fully and voluntarily repay a $205 million Bitcoin-backed loan. As a result, Silvergate released 34,619 BTC worth of collateral to MicroStrategy. Silvergate Bank collapsed in March, and MicroStrategy said at that time that it had no other exposure to the bank apart from that loan.

Outside of Bitcoin, MicroStrategy said that its total revenue for Q1 2023 was $121.9 million, representing a 2.2% increase from Q1 2022. The company’s net income for Q1 2023 was $461.2 million, or $31.79 per share, up from a loss of $130.8 million, or $11.58 per share, in Q1 2022.

MicroStrategy stock (MSTR) is down 6.37% today and up 1.80% after hours.

The post MicroStrategy bought $209M in Bitcoin in Q1 2023; repaid Bitcoin-backed loan to Silvergate appeared first on CryptoSlate.

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BitMEX co-founder Arthur Hayes proposes Bitcoin-backed stablecoin ‘NakaDollar’

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BitMEX co-founder Arthur Hayes has proposed a Bitcoin-backed dollar-pegged stablecoin NakaDollar (NUSD) which would be backed by $1 Bitcoin and one inverse perpetual swap of BTC against USD.

In a March 8 blog post, Hayes said the stablecoin would not rely on USD reserves or centralized entities like banks. Instead, the NUSD will be backed by derivatives exchanges listing liquid inverse perpetual swaps.

“If this solution were embraced by traders and exchanges, it would lead to a large growth in Bitcoin derivatives open interest, which would in turn create deep liquidity.”

The combination of short BTC positions and USD inverse perpetual swaps ensures that no matter the value of Bitcoin, the dollar value of the stablecoin will remain stable.

Hayes suggests DAO

Hayes noted that the NUSD stablecoin design will still be centralized, only that the dependency would be on centralized crypto derivatives exchanges instead of hostile fiat banks.

Meanwhile, the proposal also stated that the first step towards creating NakaUSD is establishing a decentralized autonomous organization (DAO) with its own NAKA token. The DAO will be responsible for the governance and operations of the stablecoin.

How NUSD would be created

Using mathematical calculations, Hayes showed how the stablecoin would remain stable despite the market’s volatility. According to him, creating 1 NUSD would involve depositing $1 Bitcoin on a derivative exchange and then shorting it on an inverse perpetual swap.

Hayes explained that only a few individuals or firms could create and redeem NUSD directly from the DAO. He added that the NAKA governance token and NUSD would be based on the Ethereum blockchain.

Hayes believes his approach would create dollar-pegged stablecoins that wouldn’t rely on the dollar. It allows the synthetic creation of “USD equivalent, without ever touching USD held in the fiat banking system or a stablecoin in crypto. It also does not encumber more crypto collateral than it creates in fiat value, like MakerDAO,” he explained.

If successfully implemented, NUSD will break the reliance of stablecoins on the US dollar and the need to find crypto-friendly banks. This would be a welcome development for the industry, which is still smarting from the recent regulatory efforts to curb traditional financial institutions’ exposure to crypto.

BitMEX corroborated Hayes’ view. The exchange wrote:

“Using NUSD vs. other stablecoins would remove a central pillar of crypto FUD which allows for more trading because traders would no longer be worried that they might get stuck with a bunch of stablecoins that they cannot redeem for 1:1 of their USD value.”

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