Crypto Spotlight - Galaxy Digital purchase GK8, Spotify test Web3 features, and Mastercard debuts new crypto payment method

Bitcoin has made a massive resurgence since the start of the year. The collapse of Terra-Luna and FTX had a detrimental impact on the market, but the former head of research at CoinDesk, Noelle Acheson, had an interesting take as to how it managed to pull through.

While some believe that Bitcoin is only used for speculation, Acheson argues that it also serves as a long-term investment, a store of value, and even a payment tool. Bitcoin's multiple use cases, including the growth of the Lightning Network and the possibility of it becoming an NFT platform, have provided support for its price, even amid terrible news and negative sentiment. 

Acheson also points out that most Bitcoin held in addresses do not move much, with over 67% of Bitcoin not moving in over one year, and almost 50% not moving in over two years. This suggests that many holders are long-term investors or using it as a hedge, providing further price support.

Furthermore, with the SEC’s crackdown on crypto now stronger than ever, many are moving money from stablecoins and cryptos that offer staking, into Bitcoin. President of the SEC Gary Gensler has heavily implied that Bitcoin will likely not face any SEC sanctions, as there is no group of entrepreneurs at the center of the cryptocurrency. Overall, it appears to be a great time for Bitcoin holders, especially in the context of the past year. Here’s all today’s news.

1 - Binance’s planned acquisition of Voyager has been met with objections from regulators at both the federal and state levels in the US. The Securities and Exchange Commission (SEC) and the New York State Department of Financial Services (NYDFS) have expressed concerns about the legality of the deal. The SEC has cited Voyager's VGX token as a possible violation of securities laws. This is the second time in two weeks Binance has been at the center of the crypto securities debate.

The NYDFS has also alleged that Voyager operated illegally in the state of New York, serving customers without a license. The NYDFS has also said that the plan discriminates against New Yorkers, who will not be able to reclaim their crypto for six months while Binance gains approval in the state.

Both the SEC and the NYDFS have raised concerns about the feasibility of the deal, with the SEC citing media reports that Binance is preparing to pay penalties for past money laundering and corruption infractions.

Voyager creditors had until February 23 to approve the deal. While Voyager had argued that the Binance-US deal offered the best possible outcome for creditors, the objections from regulators may have swayed some creditors against the agreement.

2 - Mike Novogratz's Galaxy Digital has completed its acquisition of self-custody platform GK8 from bankrupt crypto lender Celsius for approximately $44 million. This is a more than 60% discount from its previous acquisition price of $115 million.

GK8's multi-party computation (MPC) vault, which splits the private key needed to access the assets between an unlimited number of co-signers, will be integrated into Galaxy Digital's forthcoming brokerage platform. GK8's cold vault, which processes transactions manually and creates, signs, and sends transactions to the blockchain without an internet connection, will also be offered to clients as a highly valuable custody technology.

3 - Music streaming platform Spotify is currently testing a new service called token-enabled playlists, which allows NFT holders to connect their wallets and listen to curated music. The pilot is currently only available for Android users in the U.S., U.K., Germany, Australia, and New Zealand. Spotify has previously experimented with integrating NFTs into its service, allowing a select group of artists, including Steve Aoki and The Wombats, to promote NFTs on their profiles.

 (Source: CoinDesk)


4 - ARK Invest, the investment management firm led by Cathie Wood, has purchased over $13 million worth of Coinbase shares. This adds to their $9.2 million purchase of Coinbase shares earlier this month. This is ARK's biggest COIN order of the year and follows Coinbase's Q4 earnings report, which exceeded expectations. Coinbase's stock has seen significant volatility, losing 86% of its value in 2022 before more than doubling in January 2023 and pulling back slightly this month.

5 - Mastercard has partnered with Web3 payment protocol Immersve to allow users to make real-time cryptocurrency transactions using their existing Web3 wallets. Transactions can be made without relying on a third party for collateral. The partnership uses decentralized protocols to settle transactions on outlets accepting Mastercard payments online. Once the transaction is successful, USD Coin tokens will be converted to fiat and used to settle transactions on Mastercard's network. Users can access the feature through popular Web3 wallets and use their private keys to approve payments. 

6 - Bitcoin mining consulting firm Sabre56 has raised $35 million to build its own hosting sites. The company plans to have 150MW of energy capacity ready by the end of 2023. Sabre65 already has a waiting list of clients for the hosting service, which will be priced between $0.068-$0.072 per kWh of electricity consumed. They plan to add 150MW of capacity annually for the next four years. The first four sites, totaling 115MW, will be located in Wyoming and Texas, with the first batch coming online in mid-March.