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Paxos Makes Fresh Push for DeFi Market With Oracle Integration

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Paxos is teaming up with Chainlink in a bid to make its asset-backed tokens more widely available across the decentralized finance (DeFi) market.

The Paxos Standard (PAX) and Paxos Gold (PAXG) tokens are now available on Chainlink’s oracle network, according to a blog post shared early with CoinDesk. Chainlink operates as background pricing and data infrastructure for many DeFi projects and accounts for over 50% of on-chain smart contract calls among oracles, according to DeBank.

Paxos’ stablecoin tokens have mainly been playing catch up since the DeFi spike in 2020. Of the top DeFi lending platforms according to DeFi Pulse, only MakerDAO currently offers PAX as a collateral type.

Moreover, stablecoins dai, USD Coin (USDC) and tether make up the lion’s share of stablecoin activity on the Ethereum blockchain (where DeFi apps tend to live), according to data provider DeBank.

The addition of Paxos’ tokens to Chainlink’s feeds necessarily makes integration of new assets easier for each DeFi application leaning on the data provider. It also adds validity to the growing trend of real world assets making their way to the $21 billion DeFi market.

Paxos is using its sterling reputation to lure investors toward its stablecoins.

Each Paxos product is backed by a string of private and public entities attesting to actual reserves, said the company’s head of strategy Walter Hessert in a phone interview with CoinDesk. 

The New York-based firm – which was recently tapped to source PayPal’s cryptocurrency supply – holds a New York trust charter. That means every crypto product addition is reviewed by the regulator, Hessert said.

Paxos’ bank accounts are also audited monthly by New Jersey-based accounting firm Withum. Those findings are pushed to Paxos’ API feed which is then further routed to projects using Paxos’ tokens as collateral.

“Chainlink oracles will accelerate the adoption of Paxos’ USD and gold-backed tokens in DeFi,” Hessert said in a statement. “With the proof of reserve and price available on-chain, our regulated assets will become more accessible for DeFi users.”



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Valkyrie Digital Assets Files for Bitcoin ETF

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Valkyrie Digital Assets filed an application on Friday for a bitcoin exchange-traded fund (ETF), becoming the second company to do so in a month.

According to Dallas-registered Valkyrie Digital Assets, the Valkyrie Bitcoin Trust would be listed on the New York Stock Exchange and Coinbase Custody Trust Company, LLC would serve as the custodian for the proposed ETF.

Leah Wald, CEO of Valkyrie Digital Assets, told CoinDesk, “Our executive team has previously launched multiple ETFs, publicly traded funds, and ETPs, including bitcoin funds.”

Wald explains the team behind the ETF includes, “Steven McClurg and John Key who have collectively worked on over 100 esoteric and novel deals that have passed regulatory scrutiny.”

While an ETF is seen as advantageous because it trades on the stock market in much the same way as shares in popular companies such as Apple and Microsoft, over the years the U.S. Securities and Exchange Commission has rejected bitcoin ETF proposals due to concerns about market volatility and industry manipulation. 

Still, there’ve been signs the SEC is warming to the idea. In October 2020, then-Chairman Jay Clayton, who many saw as lukewarm toward crypto, said the agency was still open to considering ETF proposals.

Now, with a new administration causing a changing of the guard at the SEC, it is widely hoped by crypto advocates that such an ETF will be approved in 2021. Clayton stepped down officially last month and was replaced by Gary Gensler, who is widely seen as being more pro-crypto than is his predecessor.

Also adding to optimism is this month’s departure of Dalia Blass, the director of the SEC’s division of investment management. Blass was the author of a 2018 letter within the SEC expressing concerns that the bitcoin market was not large enough or liquid enough to be ready for an exchange-traded product.



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Another Pro-Crypto Appointment in the Biden Administration?

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Reports are that Chris Brummer – author of a volume on crypto assets and frequent speaker on digital currencies – will chair the CFTC.

This episode is sponsored by Nexo.io.

On this edition of the Weekly Recap, NLW argues that while bitcoin’s price was the short-term story of the week, the medium-term story was all about the transition of power in the U.S. to the new Biden Administration. In it, he discusses what the appointments (reported or confirmed) of Janet Yellen, Gary Gensler, Michael Barr and Chris Brummer suggest about the future of crypto policy.

Image credit: Chip Somodevilla/Getty Images News



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MicroStrategy Buys the Dip, Adds $10M to Bitcoin Treasury

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CEO Michael Saylor bought the coins for an average price of $31,808.



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