FalconX raises $17M to power its crypto trading service – TechCrunch
Over the last few weeks all eyes in the crypto world have been glued to the halvening, a nigh-religious moment in the blockchain realm. Every once in a while, the amount of new bitcoin mined — distributed to miners, the folks with fleets of computers powering bitcoin’s database, or blockchain — is cut in half. Why does that matter? It slows the rate at which new bitcoin is introduced to the world as the cryptocurrency marches toward its 21 million coin cap.
That’s to say that, while you weren’t looking, the world of digital tokens and currencies has marched along, maturing to some degree as cryptocurrencies and other blockchain-based services settle into slightly more predictable trading ranges.
The companies working in the crypto space are growing up as well, building out better, more sophisticated tooling for retail and institutional investors alike. FalconX is one such company, and today it announced that it has raised $17 million to date.
The crypto trading service — more on what it does in a moment — is backed by a legion of investors including Fidelity-affiliated Avon Ventures, corporate shop Coinbase Ventures, and a host of more traditional players including Lightspeed, Flybridge, Accel, Fenbushi, and Accomplice. Normally we’d curtail the list of investors to merely the most interesting, but in this case it felt reasonable to include them all, as the sheer number of capital shops that put up money for FalconX details that there is still niche and mainstream venture interest in at least some crypto-focused companies.
FalconX is also a company that anyone can understand, which probably helped. The company’s tech helps provide pricing information for cryptocurrencies, offering what it calls the “best” price for a period of time (seconds). That might sound somewhat simple, but it’s not; the crypto world is made up of a host of exchanges, is awash with fake trading volume and has a history of being pushed around by large accounts. To be able to offer a price, and hold onto it, is material.
The company is currently focused on institutional customers, which the company’s founders Raghu Yarlagadda and Prabhakar Reddy loosely described to TechCrunch as those with $10 million AUM (assets under management) and up. This likely makes KYC (know your customers) rules easier for the startup to follow.
FalconX makes money from trading fees, albeit in two ways. It offers either crypto prices with its fees included or on a fixed-fee model. Notably the firm says that crypto-native customers prefer the baked-in approach, while more traditional customers prefer the visible-fee method.
Either way, FalconX’s tech has found an audience. It has executed $7 billion in trading volume in the last 10 months (I asked about the seemingly odd time interval, which the firm explained as its most recent, fully-audited time period; it has seen more total volume during its life.)
That $7 billion volume result is likely why FalconX was able to attract external capital. And the fact that the startup appears to care about treating crypto seriously and not as a way to get around traditional banking regulations.
For example, after FalconX brought up anti-money laundering work during a discussion about regulation, TechCrunch asked the company how far it can look into its transactions to make sure that it isn’t accidentally helping bad folks get money. Yarlagadda responded, saying that “the future of regulation” in his space is “solving some of these problems and showing [them] to the [regulatory] agencies so that they get comfortable about the space.”
How is FalconX going about that? It uses “internal on-chain analytics” as well as third-parties to help get “context [into] which bitcoin addresses, or ethereum addresses, are associated with dark web or terrorist activities” to make sure that its trades are not winding up helping the wrong folks. This isn’t easy; the startup has to look through “six, seven hops” so that it can see if any money that goes through its service is suspect.
That seems pretty good, right? I found it impressive. Even more, after Yarlagadda joked that it’s not cheap to pay for the computing power needed to pull off that work, FalconX told TechCrunch that the expense counts as COGS. Neat!
There’s a fine line when covering anything blockchain-related between producing something that regular folks can understand, and writing something that the crypto-believing world won’t dismiss out of hand as insufficiently nuanced. Summing then, in case I swung too far towards the latter, FalconX built a pricing engine that allows big investors to make trades with more confidence. It gets paid when they trade and is processing lots of volume. That means its revenues are going up. And that’s why it raised more money.
The next question for FalconX is how fast it can scale volume. The faster it can, the more enticing it will prove to investors. And in time, if it does open up to more retail-sized traders, who knows, it could even become a household name.
At least in crypto.
Author: Alex Wilhelm
- Stellar Lumens May Be Signaling Where Bitcoin Is Headed Next
- Bitcoin Is Suddenly Back On The Move
- Bitcoin Just Broke Its Short-Term Downtrend; Here’s How High It Could Rally
- ‘History Has Repeated’: F2Pool Explains Message in Last Block Before Bitcoin Halving
- 2 Days After the Bitcoin Halving: Network ‘Remains Strong,’ Higher Fees, Bullish Sentiment | Featured Bitcoin News
Stellar Lumens May Be Signaling Where Bitcoin Is Headed Next
Stellar Lumens appears to have led run-ups in the cryptocurrency market over the past month. If history repeats, Bitcoin could follow XLM’s current upward advance.
Crypto Briefing has repeatedly stated over the past couple of weeks that a unique correlation developed between Stellar Lumens’ price and the flagship cryptocurrency.
Indeed, each time Stellar posted significant gains, Bitcoin appeared to follow later on. The first time this anomaly occurred was on Apr. 5.
During that time, the bullish momentum behind Stellar rose, leading to a 7% upswing by the time BTC started surging. A couple of days later, the pioneer cryptocurrency began ticking up after XLM had already advanced 5%.
Following the aforementioned instances, the same pattern developed three more times adding credibility to its predictive power over Bitcoin’s price action.
Stellar Lumens has now entered an upward impulse that has seen it recover most of the losses incurred over the weekend in a market-wide correction. The recent price action led to the formation of a buy signal based on the TD sequential indicator.
The bullish pattern developed in the form of a red nine candlestick on XLM’s 1-day chart. A further increase in the buying pressure behind this cryptocurrency could validate the buy signal presented by the TD setup.
Under such circumstances, the cross-border transactions token may be bound for a one to four candlesticks upswing or the beginning of a new upward countdown.
A candlestick close above the 23.6% Fibonacci retracement level will signal a move towards the mid-February high of $0.09. On the flip side, the 38.2% Fibonacci retracement level must hold for the continuity of the uptrend.
It is uncertain how much trust can be put into Stellar leading Bitcoin’s price, but the recent history suggests that a lot.
One could expect that BTC may break out sooner than later now that XLM is up over 18% from the weekend’s swing low.
The Bollinger bands on BTC’s 4-hour chart add credence to this bullish outlook. As these bands have begun to squeeze, a period of high volatility has been building up.
A candlestick close above the 50% Fibonacci retracement level can be used as confirmation of the optimistic scenario. Moving past this resistance level may see Bitcoin advance towards the next supply barriers around the 38.2% and 23.6% Fibonacci retracement levels.
These areas of resistance sit at $9,300 and $9,600, respectively.
Nevertheless, a spike in the selling pressure behind Bitcoin would see it plummet to the 61.8% Fibonacci retracement level. Breaking below this support wall could put in jeopardy the bullish outlook sending BTC to $8,400.
Bitcoin has made major headlines as of late thanks to the latest halving and billionaire Paul Tudor Jones’ announcing his investing 2% of his capital in BTC.
As the pioneer cryptocurrency becomes more scarce, Coin Metrics also pointed out that Bitcoin’s supply on exchanges is dropping rapidly.
Meanwhile, the number of BTC holders is rising at an exponential rate. Data from Santiment reveals that retail investors with 0.001 to 100 BTC have been accumulating heavily over the past six months. And, the number of big players with 1,000 to 10,000 BTC have also started increasing.
Now, it is just a matter of time before the price of Bitcoin starts to feel the effects of the recent supply shock. And with Stellar Lumens tracking upwards, these effects could be bullish.
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Bitcoin Is Suddenly Back On The Move
Bitcoin, after an anticlimactic supply squeeze earlier this week, has suddenly leaped toward $10,000.
The bitcoin price is up around 5% on the last 24-hour trading period and is still climbing—hitting $9,345 per bitcoin on the Luxembourg-based Bitstamp exchange.
MORE FROM FORBESBitcoin Halving: Is Now When To Buy Bitcoin?By Billy Bambrough
Bitcoin traders and investors have been closely watching the bitcoin price after the … [+] hotly-anticipated halving supply squeeze this week.
On Monday, the number of bitcoin rewarded to those that maintain the bitcoin network, called miners, was cut by half—dropping from 12.5 bitcoin to 6.25.
In the short term, the bitcoin price is widely-expected to be highly volatile as bitcoin miners try to balance the price with their running costs.
Many bitcoin traders and investors had warned the bitcoin price could crash in the aftermath of the halving—but those fears have yet to materialize.
Despite warning of a post-halving drop most bitcoin analysts are confident the price will climb eventually, with many forecasting bitcoin will retest its all-time highs.
“In my view, $10,000 to $10,300 per bitcoin is a significant resistance area,” eToro analyst Simon Peters said, pointing to data from blockchain analytics firm Glassnode that shows bitcoin investors stopped buying bitcoin as the price rose over $10,000, “indicating decreasing confidence in prices at that level.”
“Bitcoin has struggled to pass it on numerous occasions since the drop in September 2019. It could be that if we do see bitcoin hit $10,000 again, it will be followed by another short retracement like Sunday’s, and prices staying in below for a few months or so.”
The bitcoin price crashed over 10% on Sunday ahead of bitcoin’s third halving, spooking many bitcoin traders and investors.
However, Peters expects bitcoin to see a new all-time high within 18 months, “in the $20,000 to $50,000 per bitcoin region.”
MORE FROM FORBESSudden Bitcoin Crash Sparks Serious Coinbase WarningBy Billy Bambrough
The bitcoin price had been treading water since the bitcoin halving but has now made a break toward … [+] $10,000.
Meanwhile, bitcoin bulls have cheered support from some high profile investors who aren’t happy with the Federal Reserve and other central banks.
The bitcoin and cryptocurrency market was set alight last week by news legendary macro investor Paul Tudor Jones is buying bitcoin as a hedge against the inflation he sees coming as a result of unprecedented coronavirus and lockdown-induced central bank money-printing.
Chamath Palihapitiya, the chief executive of Social Capital and Virgin Galactic chairman, has warned the Fed is creating a “deflationary cycle” by pumping trillions of dollars of cheap cash into the system.
“Now all of a sudden even [Paul Tudor Jones] is looking at bitcoin and the reason is because we are in this massive deflationary cycle,” Palihapitiya told CNBC this week.
“I still struggle to find anything that is as uncorrelated to anything and to everything else than bitcoin.”
Author: Billy Bambrough
Bitcoin Just Broke Its Short-Term Downtrend; Here’s How High It Could Rally
After making multiple attempts to break back above $9,000, Bitcoin buyers were finally able to surmount this key price level.
The crypto has now been able to erase the majority of the losses that came about as a result of its recent selloff to lows of $8,100, but it still faces some major resistance throughout the mid-$9,000 region that could slow its ascent.
It is imperative to note that Bitcoin was able to break its low-time-frame downtrend that it had previously been caught within, opening the gates for further upside.
This come as analysts note that it is flashing immense signs of strength as it continues trading above a key technical level.
At the time of writing, Bitcoin is trading up just under 3% at its current price of $9,060, marking a notable climb from daily lows of $8,700.
Today’s move higher marks an extension of the momentum that was first incurred last week when BTC dipped to lows of $8,100. Its subsequent recovery from this selloff elucidates that bulls have some immense underlying strength.
In the near-term, if the benchmark cryptocurrency is able to gain a solid footing within the $9,000 region, it may struggle to surmount the heavy resistance that it previously faced at $9,200 and $9,500.
In spite of this, its firmly bullish market structure may be enough to push it past this resistance.
One popular pseudonymous analyst on Twitter explained in a recent tweet that he is bull-biased so-long as BTC is able to hold above its cloud formation.
“You can hate bitcoin as much as you want, but as long as it continuously closes above the cloud the bias is – bullish,” he stated while pointing to the below chart.
Another byproduct of this recent break above $9,000 has been an invalidation of the short-term downtrend it was previously caught within.
This breakout was mused by another respected analyst, who explained that it could be poised to rally in the days ahead.
“BTC looks good for a move up. Broke downtrend line from 10k top. Broke LTF downtrend,” he said.
If this downtrend breakout does catalyze some immense momentum, it is possible that Bitcoin will soon target a movement to its yearly highs at over $10,000.
Featured image from Unplash.
‘History Has Repeated’: F2Pool Explains Message in Last Block Before Bitcoin Halving
Ushering in bitcoin’s third “halving,” by far the most highly awaited cryptocurrency event of the year, mining pool F2Pool rooted a mysterious message into the blockchain that will now reside there forever.
Preceded by a fish emoji signifying the company’s logo, the mining pool added the text to a headline from The New York Times: “NYTimes 09/Apr/2020 With $2.3T Injection, Fed’s Plan Far Exceeds 2008 Rescue.” To bitcoin OGs, the significance is clear. It’s a reference to a similar newspaper heading that bitcoin creator Satoshi Nakamoto embedded into the first-ever block slyly referencing the 2008’s momentous financial crisis, implying that bitcoin might be able to help combat associated systemic problems.
By chance, mining pool F2Pool won the last block reward Monday before bitcoin’s much-anticipated “halving” event, which cuts in half bitcoin’s block rewards – how much bitcoin is created every 10 minutes, allowing them to embed the text.
“With the changes in the global economic environment, central banks of various countries have gradually adopted aggressive [Quantitative Easing (QE)] policies. We have found that Mr. Satoshi Nakamoto’s concerns have been there and are getting more and more serious since the economic crisis of 2008,” F2Pool CMO Qingfei Li added, referencing QE, a policy where central banks buy long-term capital assets to increase the money supply to stimulate the economy.
The stunt has been a hit with Bitcoiners who are aware of the history and symbolic significance of the genesis block. Cryptocurrency educator Andreas Antonopolous called the act “iconic,” while Scalar Capital co-founder Linda Xie tweeted, “Is it weird I’m crying a little?”
Bitcoin’s new age
Back in 2009 when Bitcoin’s code ran for the first time, Satoshi embedded the following text in the block: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”
Though he, she or they never said bitcoin to stop bank bailouts, the community has come to see this secret message as a sign of the goals of bitcoin: To fix some of the issues and corruption inherent in today’s financial system.
Chun said they selected The New York Times, since it’s like the American version of Britain’s The Times, further echoing the initial message.
They chose the halving in particular to embed this message because it is like a marker for a “new age” for bitcoin, Chun said. “Every time Bitcoin gets halved. We see Bitcoin enters a new age. The boundary is quite clear,” Chun added.
He went so far as to say it marks the beginning of “episode III” of bitcoin, referencing Star Wars. (Chun likes his Star Wars references. In a video mirroring the classic scrolling Star Wars introduction, Chun recounts bitcoin’s beginnings with a Biblical touch: “In the beginning, God created the heaven and the earth and the white paper.”)
You’d think it would be episode IV, but as a loyal programmer, he said he starts counting from zero.
The halving is also a sign of bitcoin’s maturity, according to Li.
“Because the halving of Bitcoin is a very memorable event for the Bitcoin blockchain and all the participants of [the] crypto market, which means that the currency experiment (bitcoin blockchain) has been successfully carried out for nearly 12 years and will continue to run. It is very commemorative to insert the news at such a time,” Li said.
Chun noted that he’s not an “economic expert,” but summarized a ubiquitous view in the bitcoin community, that bitcoin is because user’s have more control.
“Bitcoin [gave] people back the control, and their freedom, for the first time since banks took it over some 100 years ago,” he said.
Author: Daniel Cawrey
2 Days After the Bitcoin Halving: Network ‘Remains Strong,’ Higher Fees, Bullish Sentiment | Featured Bitcoin News
On May 11, 2020, the Bitcoin network completed it’s third block reward halving and the network seems to be chugging along just fine. However, it may take a while longer to see the halving’s effect on the mining industry and right now bitcoin transaction fees have risen exponentially. Despite the rising fees, the research firm Glassnode explains that the Bitcoin blockchain’s health “remains strong” after the reward reduction.
The Bitcoin (BTC) network has halved its block reward and so far, everything is still working as intended, at least for now. One issue people are complaining about today is the fact that transaction fees have risen significantly since the halving. For instance, if one was to do a rough average of the 50 blocks mined before the halving, they would see that miners were getting around 0.205 BTC in transaction fees per block.
After the halving, however, and a little beforehand, the transaction (txn) fees started rising much higher. At the time of publication, the fee required to get into the next block can range between $2-4 per txn. 241 blocks have been mined so far after the halving, and miners are getting around 1 BTC in fees per block or a touch more or touch less per block. Meaning, most miners are getting around 7.5 to 8 BTC per block, which is not too bad of a loss especially with the price rising slowly.
A recent report from the research and analysis firm Glassnode called “The Week Onchain: Week 19, 2020,” explains that the Bitcoin network is still in peak health performance-wise. Bitcoin fundamentals remained strong leading up to and following the halving,” Glassnode reported. “Hashrate follows its trajectory as miners keep mining,” the report added. As far as BTC’s market health is concerned “onchain fundamentals dropped slightly in Week 19,” Glassnode said. “GNI registered a 2 point decrease over the week, pushing its overall assessment of the Bitcoin ecosystem to 74 points, the 10th highest weekly value since 2017. This downturn was mainly driven by the Sentiment subindex, which decreased by 13 points,” the company wrote. Glassnode further continued:
Network Health improved through solid gains in both Network Growth and Network Activity, the former reaching the highest possible value for the first time since 2017. Liquidity has seen marginal improvement over the last few weeks after registering increases in Transaction Liquidity and slight decreases in Trading Liquidity. After staying close to the 50 point mark for 5 weeks, it has now worked its way up by 9 points. In the lead up to Bitcoin’s third halving, Sentiment, on the other hand, has begun to drop sharply. Despite this, however, overall network health remains strong.
Additionally, many BTC investors and cryptocurrency company executives are still very optimistic about bitcoin’s next rise. Jean-Marie Mognetti, CEO of Coinshares, detailed in a note to investors that with “the courage of [his] conviction, [he is] bullish for bitcoin.”
“Meanwhile, the Fed is trying to keep the market sentiment positive and has extended its balance sheet by about 2.6 trillion dollars since the end of February,” Mognetti wrote. “This is the biggest monetary inflation ever witnessed and the market is expecting more fiscal stimulus and bond-buying programs to be issued. This is somehow already priced in with Fed fund futures for mid-2021 and end of 2021 price implying negative Fed rates. This is a first for the US, but we are in a time of “firsts”. Oil was also not supposed to be able to trade in negative territory,” the Coinshares CEO added. Mognetti concluded by stating:
The rest of the world needs to either keep printing money or see their own currency eroding drastically in front of the unbeatable dollars. Turkey, Brazil, or Argentina are the perfect examples of this. Consequently, in a world where investors continue to seek protection for their portfolios against the world’s Central Bank’s behavior, bitcoin, a digital currency whose supply is programmatically defined to reduce until it reaches its maximum supply, would seem to be the perfect hedge for any institutional investor’s portfolio.
At the time of publication, BTC has crossed the $9K price region once again after going below $9K just before the halving. The cryptocurrency has a market capitalization of around $166 billion today and the network hashrate was unaffected by the halving. Although data from the web portal Fork.lol shows that BTC may have lost around 15-20 exahash in the last 24 hours. If the price per BTC, continues to rise however, then those miners could easily return in the near future. If the price goes southbound, BTC network observers may see a much larger capitulation of miners leaving. So far, with more than 24 hours behind the halving and 241 blocks mined that doesn’t seem to be the case.
What do you think about the day and a half after the Bitcoin Halving? Let us know in the comments below.
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Author: Featured by Jamie Redman