Revolut introduces 11 new cryptocurrencies as users flock to crypto trading

Revolut introduces 11 new cryptocurrencies as users flock to crypto trading

Savings and Investment

The new coins take the total available cryptocurrencies on Revolut’s platform to over 20.

Image source: Revolut

Digital banking service Revolut has taken yet another step closer to becoming a one-stop-shop for all of its users’ financial needs.

The fintech, which is well on its way to becoming a financial ‘super app’, has added 11 new cryptocurrencies for its UK and EU customers to trade, taking its total offered up to over 20 coins.

In a blog post, Revolut said: “You asked for new tokens, we’ve delivered. We’ve been tracking hot tokens and top movers to bring our UK and EU customers 11 new cryptocurrencies.”

Users will now be able to trade Cardano, Uniswap, Synthetix, Yearn Finance, Uma, Bancor, Filecoin, Numeraire, Loopring, Orchid, and The Graph, as well as the other 30+ cryptocurrencies already available on Revolut’s trading platform.

As it stands, Filecoin is the most expensive coin to be added, coming in at £ 110.42 per coin, while Cardano is the least expensive, currently sitting at around £0.88 per coin.

To help familiarise users with the new coins, Revolut also provided a short blurb about each new coin and reminded users of the risks and volatility surrounding cryptocurrencies.

Earlier this year, Revolut issued a warning to its customers about Ripple’s cryptocurrency XRP after several exchanges began delisting the electronic currency.

Despite warning its customers away from XRP, Revolut’s users could still trade the embattled coin as long as its partner exchange continues to allow it to do so.

Unlike other crypto wallets, Revolut’s users can’t actually remove their purchased coins from the Revolut app, rather they are held “in cold storage with some of the best custodians in the crypto game.”

A recent AltFi investigation has discovered that Revolut could potentially be sitting on a pile of crypto worth around $1bn and while users can’t actually remove their coins from their Revolut wallets, it’s a clear sign that crypto trading is increasingly popular for Revolut’s users.

Both stock and crypto trading has boomed over the past 12 months, even more so since the beginning of this year with the rise of ‘Meme Stocks’ and the Reddit vs Wall Street saga, which prompted the likes of Revolut to halt trading of certain stocks thanks to unexpected volatility.

UPDATE 09-04-2021 - A previous version of this article misstated the amount of cryptocurrencies available on Revolut’s trading platform.

Crypto Long & Short: Peter Thiel Defines Bitcoin’s Accidental Role in Global Politics

The battle over bitcoin’s evolving role just became a piece in a complex game of political strategy.

Peter Thiel’s talk earlier this week at a Richard Nixon Foundation event thrust the cryptocurrency even further out onto the geopolitical stage and highlighted two important macro narratives that investors should keep an eye on, not just for their potential impact on crypto returns.

Here’s one extract from his comments:

Related: XRP Doubles in 7 Days, Heads for Biggest Weekly Gain Since December 2017

“I do wonder whether bitcoin should be thought of as a Chinese financial weapon against the U.S. It threatens fiat money, but it especially threatens the U.S. dollar.”

As with most things in life, context is key, and this statement is crying out for it.

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On the surface, it seems as if he is asking U.S. regulators to prevent bitcoin from becoming more of a threat to the U.S. dollar. This is the wrong interpretation. The underlying intention is both more meaningful and more supportive of bitcoin and, ultimately, the U.S. than it may at first appear.

Related: How Bitcoin Can Help Break Cycles of Poverty

Others have pointed out that Thiel is probably playing 4d chess here, and I agree with that. But I believe his underlying message is about more than bitcoin and about more than trying to get the U.S. to sit up and take notice.

Bitcoin as a weapon?

Before we unpack why Thiel might have said what he said, let’s look at what he might have meant.

Why would bitcoin threaten the U.S. dollar?

As early as 2013, Thiel was talking about bitcoin’s potential to “change the world,” and has on other occasions praised bitcoin’s reserve qualities.

Story continues

Thiel seems to be suggesting that bitcoin’s stable supply and worldwide reach could one day put it in a position to rival the U.S. dollar as the world’s reserve currency. And his statement implies that he believes China is supporting bitcoin, effectively “weaponizing it,” for this reason.

Does he really believe this?

He has access to several of the best minds in the crypto industry through some of the investments made by his funds, and is arguably a very smart individual himself. He has acknowledged that bitcoin is not the best payments system, and surely recognizes that the dollar is a strong reserve currency precisely because it is an efficient payment method. Countries want to hold it because it is essential for global commerce.

And as for China “weaponizing” bitcoin to hurt the dollar, Thiel is no doubt aware of just how long on the dollar China is. Chinese investment of U.S. Treasuries has been increasing since October of last year, and is now at almost $1.1 trillion.

What’s more, on the current macro landscape, bitcoin is probably well below central bank policies on the list of things that could hurt the U.S. currency.

And Thiel probably knows that China has not exactly been “friendly” to bitcoin. On top of the years-old ban on crypto exchanges, authorities moved to shut down bitcoin miners in Inner Mongolia last month. Given the country’s constant battle with capital flight, it’s more likely that it wishes bitcoin would just go away. And if it really wanted to weaken the dollar (which is debatable), it has methods within reach that would not also cause damage to the yuan.

So, Thiel may have said that China was trying to bring down the U.S. dollar by “weaponizing” bitcoin. But I doubt he really believes that. So, why did he say so? What is he hoping to achieve?

The real issue

To dive into these questions, we need even more ladlefuls of context.

The theme of the seminar was technology and national security. The comment flagged above was tucked into an answer to a question about China’s digital currency plans, and a discussion flowed about the potential control that would give the state over its citizens. The conversation also touched on AI, supply chains and much more, all with a sharp tinge of concern about ideological influence. Thiel even referred to the Chinese government as “omni malevolent.” Let that sink in.

Thiel’s remarks on bitcoin were most likely, as many have pointed out, an attempt to get the U.S. regulators to start taking bitcoin more seriously. But they were also about the broader threat to U.S. dominance that he sees coming from China.

The first point may seem risky – many are concerned that the U.S. might decide to ban bitcoin if it starts to see it as a threat. But, as I’ve written elsewhere, this is unlikely to happen as authorities have been watching the social unrest triggered by attempts to curtail cryptocurrency activity in countries such as Nigeria. Plus, a U.S. attempt to ban bitcoin would be the best advertisement that something like bitcoin is needed, and the domestic fallout could shore up China’s soft power play.

It is more likely that greater attention to bitcoin regulation would support investment in crypto infrastructure, which would have extended effects throughout the industry. This includes putting institutional investors’ minds more at ease with the concept, and possibly even removing the last barriers to approval of a bitcoin ETF by the SEC.

The arc of history

Now let’s turn to the broader context. As a declared Republican who donated generously to Trump’s first presidential campaign, Thiel was closer to the last administration than this one. He, and others, are concerned that the new administration will take a more relaxed stance on relations with what many see as the greatest threat to U.S. power since the Cold War: China.

This almost nationalistic tone can also be heard in Kevin O’Leary’s insistence on CDTV last month that investors aren’t going to want “China coin.”

What’s more, the 2021 National People’s Congress held in February ratified the next five-year plan which focuses on, among other things, shoring up China’s position on the global stage. The previous five-year plan described how a peaceful multilateral world would benefit China. This one highlights the danger of “hegemonism,” and describes a strong economic growth based on a vibrant domestic economy that is less dependent on others.

The crescendo in anti-American rhetoric and diplomatic actions point to escalating competition for not only trade but also hearts and minds on the international stage. The soft-power battle is being backed by loans and investment far beyond China’s borders in what appears to be a long game of influence.

I heard an interesting metaphor the other day: The U.S. favors chess, which is about capturing the opponent’s pieces in order to kill its king. The Chinese prefer Go, which is about a slow and stealthy occupation of territory.

Thiel seems to be saying that the Chinese are playing Go with bitcoin, as well as with blockchain, AI and other new technologies. He is effectively asking the U.S. to watch out for the territorial creep its inaction is facilitating.

Thiel’s talk is likely to have repercussions, slow and subtle, but real and meaningful. Hopefully, U.S. regulators will recognize the real opportunity in supporting the use of bitcoin and the development of its infrastructure. Hopefully, they will see that bitcoin is more representative of the American values of freedom and choice than many of the other new technologies making their mark on societal structures today. And hopefully they will understand that bitcoin will thrive no matter what they do, so they might as well start figuring out how to harness its innovation.

For those of us who love irony, there is much to appreciate in this emerging picture. Bitcoin is being thrust into a tussle between two world powers, when it was created to live outside national boundaries. It is being associated with political intent, when its inbuilt ideology is supposed to flourish outside party lines. It is being used as a tool in a shift away from globalization and towards nationalism, when its design is based on decentralization.

Here’s the thing: Bitcoin doesn’t care. It can be what anyone wants it to be. It’s going to continue functioning the way it does, regardless of how people see it. I’m pretty sure Peter Thiel knows that, and so if he wants to use Bitcoin to make larger points that he believes are necessary for prosperity and freedom, then I say we leave him to it.

Coinbase Makes History

Excitement is building for April 14, when crypto exchange Coinbase lists on NASDAQ under the symbol COIN. Why is this a big deal?

It’s the first crypto unicorn to go public.

This will bring crypto markets even more “mainstream,” as equity research teams will have to initiate Coinbase coverage and get informed about the crypto markets.

Investors of all types will be able to bet on the evolution of the crypto market as a whole.

Market observers will finally get a peek “under the hood” and watch up close the evolution of crypto market infrastructure.

Speaking of which, earlier this week Coinbase released its estimated Q1 earnings (pending review by the accountants), which showed some impressive progress since the S1 filing.

Q1 revenue of $1.8 billion vs. $1.3 billion for all of 2020

Q1 net income of $730 million vs. $322 million for all of 2020

Q1 adjusted EBITDA of $1.1 billion vs. $527 million for all of 2020

Monthly transacting users of 6.1 million vs. 2.8 million for all of 2020

Yes, these growth figures are dizzying. Will they be enough to justify the expected $100 billion valuation upon listing?

Applying a typical market infrastructure multiple (using CME and Nasdaq as examples) of 35x gives a total value of $100 billion – $110 billion. However, Coinbase has higher growth potential than traditional exchanges, given the relative immaturity of the assets it trades. Could it be considered a growth stock?

Let’s assume the Coinbase share price ends up being highly correlated with the bitcoin (BTC) price. As you can see from the below chart, 90-day correlations between BTC and both high-growth stocks (represented by Amazon and Tesla) and exchange stocks (represented by CME and Nasdaq) have been all over the place for the past year, implying no correlation trend.

So, given that Coinbase is an exchange, and given the growth potential of the technologies and mainstream awareness of the assets it trades, let’s apply a simple average of the multiples of CME (31x) and Nasdaq (NDAQ, 24x), and growth companies represented by Tesla (TSLA, 158x) and Amazon (AMZN, 68x). This gives a Coinbase market valuation of over $200 billion, propelling it into the top 50 of global market capitalization.

And with crypto assets, the number of users does not confer a linear growth outlook – it confers an exponential growth outlook as network effects kick in. So, the more than 30% increase in verified users in Q1 vs the end of the previous quarter implies a significant growth in potential value.

Obviously, none of these musings are investment advice, as the initial price could be seen as too high and there could be a Deliveroo-like debacle. This is unlikely, however. The shares are coming to market via a direct listing rather than an IPO, so we don’t have teams of investment bankers pressured to price ambitiously – direct listing advisors usually charge a flat fee, vs. the percentage-of-total-raised remuneration for IPO advisors.

There are risk factors on the horizon, however, such as:

Growth slows down – our latest Quarterly Review shows trading volumes tapering off in March, after the January-February surge.

The market turns, which will impact investor interest and the valuation of assets on the balance sheet.

Fees (the main source of revenue for now) compress as competition gets tougher.

Regulation gets more onerous, further increasing compliance costs.

Whatever happens to the COIN price upon listing, April 14 will be a significant day for the industry, one that will probably end up enshrined in the memes of crypto history.

CHAIN LINKS

Bloomberg analysts have extrapolated BTC’s behavior in the 2013 and 2017 bull runs and come to the conclusion that the cryptocurrency’s price could reach $400,000 this year. TAKEAWAY: Does history repeat itself? Many technical analysts will tell you yes. I recognize that psychology plays an important role in trading decisions, but I have a conceptual difficulty in betting on chart regressions. What does make sense to me is the four-year cyclical nature of bitcoin runs, given the fundamental impact of the bitcoin reward halving every four years. That we are in a bull market, as we were four and eight years ago, feels obvious at this stage. Will it continue up into six digits? It’s certainly possible, but so many other factors are in play in crypto markets today that I am personally skeptical of simple extrapolation.

The U.S. Securities and Exchange Commission (SEC) has started its review of WisdomTree’s bitcoin ETF application. TAKEAWAY: This now makes two bitcoin ETF proposals in front of the regulator. The other is VanEck’s, and a ruling on that is expected some time next month.

Grayscale Investments (a subsidiary of DCG, also parent of CoinDesk) issued a statement saying that it is “100% committed” to converting its flagship Grayscale Bitcoin Trust (GBTC) into an ETF when that becomes possible. TAKEAWAY: Expectations that the U.S. Securities and Exchange Commission will finally approve a bitcoin-based ETF are building, after years of SEC rejections, given 1) the improvement of crypto market infrastructure and surveillance, and 2) the pressure from the success of Canadian-listed bitcoin ETFs. This statement from Grayscale seems aimed at addressing the persistent discount to underlying value at which the trust’s shares have been trading since the beginning of March. If trust shares can be converted into an ETF with redemptions, there is an arbitrage play to be had: investors can effectively buy future ETF shares at a discount, which will disappear when redemptions become possible. The risk is in the uncertain timing.

NYDIG raised $100 million in a “growth capital round” from Liberty Mutual, Starr Insurance and other unnamed property and casualty coverage firms. TAKEAWAY: Given that last month NYDIG raised $200 million from MassMutual, New York Life and others, we can reasonably expect some significant crypto-related announcements from large insurance incumbents over the next few months. Given the sheer size of the insurance industry, even if the products end up being niche, we could be looking at a sizeable new market.

Online brokerage app Robinhood revealed that 9.5 million customers traded cryptocurrencies in Q1, up from 1.7 million in Q4. TAKEAWAY: Combine this with the jump in monthly transacting users that Coinbase shared in its estimated Q1 earnings release (see THE BRIEFING above) – 6.1 million, vs. 2.8 million – and you get a sense of 1) the astonishing increase in retail investor activity in Q1, and how it is starting to drive the market even more than growth in interest from institutional investors. (For more on this, see our latest Quarterly Review.)

Bitcoin miners are holding on to their earned bitcoin more than they are selling them, according to a chart by Glassnode. TAKEAWAY: This is a bullish signal as: 1) it hints that miners are generally feeling optimistic about the price, and 2) it means that fewer new bitcoins are hitting the market, removing some selling pressure.

Related Stories

The Crypto Daily – Movers and Shakers – April 11th, 2021

Bloomberg

(Bloomberg) – After China imposed a record antitrust fine on Alibaba Group Holding Ltd., the e-commerce giant did an unusual thing: It thanked regulators.“Alibaba would not have achieved our growth without sound government regulation and service, and the critical oversight, tolerance and support from all of our constituencies have been crucial to our development,” the company said in an open letter. “For this, we are full of gratitude and respect.”It’s a sign of how odd China’s crackdown on the power of big tech has been compared with the rest of the world. Mark Zuckerberg and Tim Cook would likely not express such public gratitude if the U.S. government were to hit Facebook Inc. or Apple Inc. with record antitrust fines.But almost everything about China’s regulatory push is out of the ordinary. Beijing regulators wrapped up their landmark probe in just four months, compared with the years that such investigations take in the U.S. or Europe. They sent a clear message to the country’s largest corporations and their leaders that anti-competitive behavior will have consequences.For Alibaba, the $2.8 billion fine was less severe than many feared and helps lift a cloud of uncertainty hanging over founder Jack Ma’s internet empire. The 18.2 billion yuan penalty was based on just 4% of the internet giant’s 2019 domestic revenue, regulators said. While that’s triple the previous high of almost $1 billion that U.S. chipmaker Qualcomm Inc. handed over in 2015, it’s far less than the maximum 10% allowed under Chinese law.The fine came with a plethora of “rectifications” that Alibaba will have to put in place – such as curtailing the practice of forcing merchants to choose between Alibaba or a competing platform – many of which the company had already pledged to establish.Read more: China Fines Alibaba Record $2.8 Billion After Monopoly ProbeAlibaba Chief Executive Officer Daniel Zhang on Saturday declared his company now ready to move on from its ordeal, while China’s Communist Party mouthpiece People’s Daily issued assurances that Beijing wasn’t trying to stifle the sector.The Hangzhou-based firm “has escaped possible outcomes such as a forced breakup or divestment of assets. The penalty will not shake up its business model, either,” said Jet Deng, an antitrust lawyer at the Beijing office of law firm Dentons.Still, neither Zhang nor state media addressed lingering questions around the extent to which Beijing remains intent on reining in its internet and fintech giants, a broad campaign that’s wiped more than $250 billion off Alibaba’s valuation since October. The e-commerce giant’s speedy capitulation also underscores its vulnerability to further regulatory action – a far cry from just six years ago, when Alibaba openly contested one agency’s censure over counterfeit goods on Taobao and eventually forced the State Administration for Industry and Commerce to backtrack on its allegations.Beyond antitrust, government agencies are said to be scrutinizing other parts of Ma’s empire, including Ant Group Co.’s consumer-lending businesses and Alibaba’s extensive media holdings. And the shock of the crackdown will continue to resonate with peers from Tencent Holdings Ltd. and Baidu Inc. to Meituan, forcing them to tread far more carefully on business expansions and acquisitions for some time to come.What Bloomberg Intelligence SaysChina’s record fine on Alibaba may lift the regulatory overhang that has weighed on the company since the start of an anti-monopoly probe in late December. The 18.2 billion yuan ($2.8 billion) fine, to penalize the anti-competitive practice of merchant exclusivity, is equivalent to 4% of Alibaba’s 2019 domestic sales. Still, the company may have to be conservative with acquisitions and its broader business practices.– Vey-Sern Ling and Tiffany Tam, analystsClick here for the full research.The investigation into Alibaba was one of the opening salvos in a campaign seemingly designed to curb the power of China’s internet leaders, which kicked off after Ma infamously rebuked “pawn shop” Chinese lenders, regulators who don’t get the internet, and the “old men” of the global banking community. Those comments set in motion an unprecedented regulatory offensive, including scuttling Ant’s $35 billion initial public offering.It remains unclear whether the watchdog or other agencies might demand further action. Regulators are said, for instance, to be concerned about Alibaba’s ability to sway public discourse and want the company to sell some of its media assets, including the South China Morning Post, Hong Kong’s leading English-language newspaper.Read more: China Presses Alibaba to Sell Media Assets, Including SCMPChina’s top financial regulators now see Tencent as the next target for increased supervision, Bloomberg News has reported. And the central bank is said to be leading discussions around establishing a joint venture with local technology giants to oversee the lucrative data they collect from hundreds of millions of consumers, which would be a significant escalation in regulators’ attempts to tighten their grip over the country’s internet sector.“The high fine puts the regulator in the media spotlight and sends a strong signal to the tech sector that such types of exclusionary conduct will no longer be tolerated,” said Angela Zhang, author of “Chinese Antitrust Exceptionalism” and director of the Centre for Chinese Law at the University of Hong Kong. “It’s a stone that kills two birds.”For now, it appears investors are just glad it wasn’t worse. In its statement, the State Administration for Market Regulation concluded Alibaba had used data and algorithms “to maintain and strengthen its own market power and obtain improper competitive advantage.” Its practice of imposing a “pick one from two” choice on merchants “shuts out and restricts competition” in the domestic online retail market, according to the statement.The firm will be required to implement “comprehensive rectifications,” including strengthening internal controls, upholding fair competition and protecting businesses on its platform and consumers’ rights, the regulator said. It will need to submit reports on self-regulation to the authority for three consecutive years.Alibaba said it will hold a conference call Monday morning Hong Kong time to address the antitrust watchdog’s decree. The company will have to make adjustments but can now “start over,” Zhang wrote in a memo to Alibaba’s employees Saturday.“We believe market concerns over the anti-monopoly investigation on BABA are addressed by SAMR’s recent decision and penalties,” Jefferies analysts wrote in a research note entitled “A New Starting Point.”Indeed, The People’s Daily said in its commentary Saturday that the punishment was intended merely to “prevent the disorderly expansion of capital.”“It doesn’t mean denying the significant role of platform economy in overall economic and social development, and doesn’t signal a shift of attitude in terms of the country’s support to the platform economy,” the newspaper said. “Regulations are for better development, and ‘reining in’ is also a kind of love.”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.