DBS Bank Singapore Launches Asia's First Direct Crypto Offering To Clients

DBS Bank Singapore Launches Asia’s First Direct Crypto Offering To Clients

Bloomberg

(Bloomberg) – At their highs, five electric-vehicle startups that went public through mergers with special purpose acquisition companies were worth $60 billion. The corrections that followed have been brutal.Three of the companies plumbed new lows this week as short-seller attacks, management turmoil and execution issues lead investors to reconsider their prospects. They’ve lost more than $40 billion of market capitalization combined from their respective peaks.The sliding valuations of Nikola Corp., Fisker Inc., Lordstown Motors Corp., Canoo Inc. and Arrival Ltd. underscore the risks surrounding the blank-check boom. Unlike in a traditional initial public offering, going public via SPAC allows companies to make forward projections to investors during their listings. This was key to ginning up interest in EV companies – all five are still working on delivering their first vehicles to customers.Here’s a breakdown of what’s happened at each company:NikolaFounder Trevor Milton burst onto the scene last year boasting that he could “out-Elon” Tesla Inc.’s Elon Musk. Days after his battery-electric and hydrogen-powered truck maker debuted on the Nasdaq in June, it was worth almost $29 billion, rivaling Ford Motor Co. at the time.When Bloomberg News reported that Milton had exaggerated the capability of his first truck years before the company went public, it got the attention of Hindenburg Research. The small short-selling firm produced a lengthy report accusing the company of deceiving investors. The U.S. Securities and Exchange Commission opened an investigation, and Milton resigned soon after.Early this year, the company cut its projection for semi-truck production this year to 100 units, one-sixth of its earlier plan. The shares have recovered somewhat since dipping below $10 in April.FiskerThe second EV venture founded by longtime auto designer Henrik Fisker announced its reverse merger a month after Nikola’s listing. While the company was more than two years from starting production, its plan to market an under-$40,000 sport utility vehicle and outsource the manufacturing work to others turned heads. Its market value peaked at almost $8 billion in February.The catalysts for Fisker’s decline to below $3 billion this week have been less clear than some of its peers. The company appeared to lose out as investors grew more bullish about incumbent automakers’ EV prospects. Its shares are surging in early trading after an announcement late Thursday of plans to develop an EV with Foxconn Technology Group and build it in the U.S.Lordstown MotorsThen-Vice President Mike Pence attended Lordstown’s unveiling of its Endurance work truck in June at the factory the company took over from General Motors Co. While it was a risky move championing a company with just 70 full-time employees, the Trump administration was eager to embrace a startup trying to revive an Ohio plant that once employed 10,000 people.Less than six weeks later, Lordstown found a SPAC suitor. Boasts about non-binding orders gave way to another attack by Hindenburg Research, which leveled accusations similar to the ones aimed at Nikola – that Lordstown had misled investors. The SEC has been looking into the claims. Lordstown is now valued at $1.2 billion, less than a quarter what it was worth in mid February.CanooThe startup founded by a pair of former BMW AG executives unveiled a seven-seat prototype in late 2019, struck a deal early last year to help Hyundai Motor Group develop EVs, then another agreement in August to go public. In January, the Verge reported it had met with Apple Inc. about its car ambitions.That momentum is now long gone. The company announced a hard pivot in its business plans in March, deciding to de-emphasize engineering services for other companies and the subscription business model that was part of its original pitch to investors. It has replaced top executives, including its chief financial officer, and said it hasn’t addressed material weaknesses in its financial controls identified more than a year ago. Last month, one of its co-founders resigned the CEO position.ArrivalThe company pledging to build electric vans and buses as well as so-called microfactories to manufacture them had assembled big-name backers before its SPAC deal, including BlackRock Inc., Hyundai and United Parcel Service Inc.Last week, the London-based company founded by Denis Sverdlov, a former Russian deputy minister, said it will partner with Uber Technologies Inc. to develop an EV that’s purpose-built for ride-hailing. While Arrival shares haven’t sustained the immediate gain following that announcement, the company’s valuation is the highest among the five at $10.5 billion.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

DOGE sends Robinhood Crashing, but Musk Will Send Crypto (Literally) to the Moon — Does That Mean You Should Invest?

HANNIBAL HANSCHKE/POOL/EPA-EFE/Shutterstock / HANNIBAL HANSCHKE/POOL/EPA-EFE/Shutterstock

As was expected, Elon Musk pumped up Dogecoin during his “Saturday Night Live” appearance, but the crypto tumbled. Investors rushed to trade, once again triggering Robinhood to crash temporarily.

See: Dogecoin’s Major Price Increase — Is It Still Worth an Investment?

Find: 10 Best Cryptocurrencies To Invest in for 2021

“Crypto trading is back up and running. Due to high trading volume and volatility, some customers might see some intermittent issues. We’re working hard to provide a smooth experience, and will monitor the situation closely,” Robinhood tweeted at 12:52 a.m. Sunday, adding shortly later, “Our team is looking into who may have been impacted by our downtime tonight, and will be reaching out to affected customers.”

The crash brought the ire of many traders on Twitter, who threatened to “leave the app.”

Doge was trading at a record $0.70 Saturday, plummeting to $0.42, according to CoinMarketCap data. It also reached $65 billion in market cap, according to Coinbase. This morning, Doge was at $0.49.

See: Dogecoin Exceeds $11 Billion Market Cap as Coinbase Launches IPO

Find: Hedge Fund Manager Warns: Beware the Meme Stock

Dogecoin was created as a joke — its name is a reference to a popular internet meme, according to Coinbase. “It shares many features with Litecoin. However, unlike Litecoin, there is no no limit on the number of Dogecoins that can be produced.”

While it has gained incredible traction lately as well as celebrity endorsements, including Mark Cuban and Snoop Dog, just like any other crypto, it’s extremely volatile. If you’re planning on investing in it, you should be ready to stomach wild swings. In addition, it doesn’t have the important supply and demand factor embedded in Bitcoin, the supply of which is capped 21 million. Dogecoin has 129.5 billion tokens in circulation and has no hard cap on the number of coins that can be produced. That said, investors who invested $100 in January, for example, made a lot of money as Doge shot up 13,000% this year, .

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People are already looking for the next crypto that could produce similar results, and many are turning their eyes toward Safemoon, for example, whose price today is at $0.000007, and hence has plenty of room to grow.

See: 10 Cheap Cryptocurrencies to Check Out

Find: What Are Altcoins — and Are the Potential Rewards Worth the Risks?

As for Tesla and SpaceX CEO Musk, aka Technoking, yesterday he announced the launch of the “DOGE-1 Mission to the Moon” in the first quarter of 2022, with the company accepting the meme-inspired cryptocurrency as payment, according to a tweet.

“Mission paid for in Doge – 1st crypto in space – 1st meme in space. To the mooooonnn!!” Musk tweeted.

Geometric Energy Corporation, an intellectual property, manufacturing and logistics firm, said in a statement that “having officially transacted with DOGE for a deal of this magnitude, Geometric Energy Corporation and SpaceX have solidified DOGE as a unit of account for lunar business in the space sector.”

See: Coinbase, the Largest US Cryptocurrency Exchange, Goes Public – ‘It Will Infect the Financial Universe with a Bad Case of FOMO’

Find: Numbers Behind the Modern-Day Space Race — Why Billionaires Are Obsessed With Going to Space and How Much They’re Spending

“This mission will demonstrate the application of cryptocurrency beyond Earth orbit and set the foundation for interplanetary commerce,” SpaceX Vice President of Commercial Sales Tom Ochinero said in the statement. “We’re excited to launch DOGE-1 to the Moon!”

The company further explained that through this transaction, “DOGE has proven to be a fast, reliable, and cryptographically secure digital currency that operates when traditional banks cannot and is sophisticated enough to finance a commercial Moon mission in full. It has been chosen as the unit of account for all lunar business between SpaceX and Geometric Energy Corporation and sets precedent for future missions to the Moon and Mars.”

More From GOBankingRates

This article originally appeared on GOBankingRates.com: DOGE sends Robinhood Crashing, but Musk Will Send Crypto (Literally) to the Moon — Does That Mean You Should Invest?

Here’s hoping Elon Musk tanks crypto so miners will leave our RTX 3080s alone

So Elon Musk made some news this week. Nope, not by absolutely whiffing it during his hosting spot on SNL, though he did indeed do that. No, the figurative lovechild of Howard Hughes and Nikola Tesla broke the hearts of a coven of crypto speculators this week when he suddenly reversed Tesla’s recent policy of accepting Bitcoin as payment for a new electric car.

Tesla & Bitcoin pic.twitter.com/YSswJmVZhPMay 12, 2021 See more

On its face, this is hardly a surprise. The flagship crypto token that parades around like an actual currency has gained a huge following in recent years, sucking up raw computing power in the cryptomines and turning it into foggy carbon emissions for no real purpose other than to make wealthy investors even richer than they already are. But unlike an actual currency that you can buy something with, the price of cryptocurrencies are extremely volatile, swinging wildly up and down by the 100s if not 1000s of percentage points in less than a year.

While Bitcoin is flying high - buoyed by thicker methane and CO2 plumes pumped out from coal-fired power plants in China and natural gas wells around the world - everyone from Musk to Goldman Sachs has been looking to cash in on the speculative gains from crypto while the getting is good.

For Tesla, a company ostensibly dedicated to saving humanity from Climate Change through electric vehicles, dabbling in cryptocurrency speculation has always been a jarring and odd fit (so long as you forget that their first priority is just to make gobs of money). Honestly, the fact that Tesla is now suddenly out of the crypto game probably has little to do with its professed concerns about the environmental devastation that cryptomining is contributing to and more about the future price of cryptocurrencies more broadly.

The environmental impact of cryptocurrency mining was known long before Musk and Tesla decided to dabble in crypto. In the end, Musk is a businessman and Tesla is in the business of making money and both he and his company are probably getting out while the getting is good. While Musk’s statement says that Tesla won’t be selling any Bitcoin, there’s no real way to hold them to that. Musk’s tweet professing concern over Bitcoin’s environmental impact has major I’m-shocked-shocked!-to-find-that-gambling-is-going-on-in-here energy and I have no doubt that whatever Bitcoin Tesla gained from vehicle purchases by Silicon Valley VCs will be liquidated at their earliest convenience - and almost certainly before they end up taking a loss on it.

All that aside, this can only be a good thing for the rest of us.

(Image credit: Yevhen Vitte / Shutterstock)

Why cryptocurrencies are awful

Elon Musk is one man, in the end, but unfortunately, he wields a lot of influence. He has a devoted following of eager wannabe indentured servants who will follow him Red Faction-style into a mining impressment on Mars when the time comes, but for now, they’re all in on Dogecoin, pushing the market capitalization of a literal joke cryptotoken to just over $72 billion (about £51.6 billion/AU$92.5 billiion) at the time of this writing.

While sad in itself, there is something to be said for “capitalist market efficiencies,” and this definitely ain’t it. If there was ever an unproductive use of capital, cryptocurrencies certainly qualify.

Even leaving aside the environmental impact, we do have genuine scarcity issues at the moment. And not just with graphics cards or other PC hardware and consoles, but the semiconductors that go into cars, medical equipment, and everything in between. Diverting the productive use of semiconductors we desperately need for actual products into cryptocurrency mining might not be solely responsible for semiconductor shortage, but it’s definitely not helping matters.

Quite frankly, a crash in cryptocurrency prices should be celebrated by just about everybody who isn’t deeply invested in it, which isn’t a whole lot of people in the end, so I’m hopeful that Musk bailing on Bitcoin is the start of a trend. It’s too soon to tell, but given that the only two things Bitcoin are really good at - financial speculation and criminal activity - make me optimistic that Musk’s quitting crypto is a portent of days to come.

(Image credit: Shutterstock / GreenBelka)

While there’s no way to truly tell how much cryptomining is cutting into everyone else’s ability to get their hands on semiconductors for other purposes, not just for graphics cards, it is certainly a factor and one that we have can arguably do something about. While ramping up semiconductor fabrication capacity will take years, crypto is operating largely free of interference by people who have the power to regulate it into irrelevance. All they need to do is decide to do something.

The recent Colonial Gas Pipeline ransomware hack points out the other nagging downside of cryptocurrencies - they are extremely attractive for criminals. While there are plenty of crypto proponents who contest this assertion, it’s inescapable that an untraceable “currency” is exactly the kind of thing that criminals are going to be drawn to. It’s the modern-day equivalent of a briefcase full of unmarked bills, except it’s even more secure since no one has to actually go and pick up the briefcase.

The fact that this group went and did something as dumb as seizing up the gasoline reserves of tens of millions of Americans on a whim for a reported $5 million payout in an unnamed cryptocurrency is no doubt going to raise pressure on the US government to treat cryptocurrencies as the potential national security threat that they are. Ransomware like this could hardly exist without cryptocurrency payments protecting hackers anonymity and so the most natural way to combat ransomware that is increasingly targeting critical infrastructure is to regulate cryptocurrencies aggressively to make them much less useful for criminals.

It’s not surprising that Musk issued his statement the same week that a ransomware attack hit some critical US infrastructure. The potential crackdown on crypto, not the environmental damage cryptomining poses, is much more likely to have prompted Tesla’s move away from Bitcoin. Hopefully more will follow Tesla’s lead.

(Image credit: Zotac)

Can Elon Musk’s tweet help you get an RTX 3080?

While Musk alone won’t tank crypto, his bringing attention to the problems it poses, even if it’s disingenuous, will impact the way people look at it. With one tweet, Musk drove the price of Bitcoin down 12%.

Hopefully his move will signal to others that maybe it’s time to get out of the crypto game before its price plunges further, and with the potential for US government action after the Colonial Pipeline hack, that’s a much more likely bet than it was even a couple of weeks ago.

Take away the demand for cryptocurrencies and you take away the incentive to mine them, which would mean fewer miners out there buying up all the RTX cards they can get their hands on. This won’t immediately make an RTX 3090 or RX 6800 XT more available, but in pretty short order it would lessen the demand that Nvidia and AMD are struggling to meet, meaning that they’ll be somewhat closer to getting a new graphics card into the hands of anyone who wants one.

All in all, I’d call that a win that’s been a long time coming.