Terra Increases Bitcoin Holdings To 42,530 BTC as UST Becomes Third-Largest Stablecoin

In a week where leaders from the cryptocurrency industry converged for the Blockchain Week Summit in Paris, one of the world’s largest cryptocurrency projects continued to acquire Bitcoin for its reserves. 

Standing at 42,530 BTC, Terra’s Bitcoin wallet is now only marginally behind Tesla’s, with the project showing no signs that it plans to slow down its acquisition.

While Elon Musk placed a takeover bid for Twitter, positive sentiment converged on XRP as Ripple’s CEO expressed optimistic views regarding the ongoing lawsuit.

To round out the week, one of the largest investment firms in the world confirmed that it will be introducing a metaverse-focused ETF.

• Terra continues BTC purchases as native stablecoin UST becomes third-largest stablecoin
• Fidelity Investments creates crypto metaverse ETF
• Ripple CEO confirms that the XRP lawsuit has gone extremely well
• Ethereum Merge postponed to Q3/Q4

Terra continues BTC purchases as native stablecoin UST becomes third-largest stablecoin

Terra, a blockchain project focused on the creation of algorithmic stablecoins, has continued to purchase Bitcoin for its stablecoin reserves. The latest purchase occurred on Friday and took the project’s total BTC holdings to 42,530.

In Mid-March the project’s founder, Do Kwon confirmed that the project was aiming to acquire $10 billion worth of BTC to act as a reserve for native stablecoins, such as TerraUSD (UST). 

Since that announcement, the Luna Foundation Guard, an organization tasked with managing Terra’s reserves, has been acquiring Bitcoin at a rapid rate. Early purchases, worth several billions of dollars, began in late March and have continued through to April.

The latest purchase on Friday was worth an estimated $5.1 million, equivalent to 127.68 BTC, and followed a larger $880 million “gift” of LUNA, the project’s native cryptocurrency. LUNA was transferred from Terraform Labs to the Luna Foundation Guard on Thursday and has since been swapped for the UST stablecoin.   

Alongside Terra’s BTC acquisition, the native US dollar stablecoin, UST, became the third-largest stablecoin by market capitalization, surpassing Binance USD (BUSD) on Monday.

The algorithmically-backed UST now commands a $17.6 billion market cap and stands behind Tether (USDT) and USD Coin (USDC) in the rankings. The market cap of UST is approximately 21% of the total market cap of USDT, which is still the world’s leading stablecoin. 

With a total market cap of $17.6 billion, UST is now the thirteenth largest digital asset globally, currently sitting just behind Polkadot (DOT). The purchases are bullish news for Bitcoin, as they demonstrate the key role of Bitcoin in locking in value in ongoing crypto development.

 

Fidelity Investments creates cryptocurrency and metaverse ETFs

One of the world’s largest investment firms, Fidelity Investments, has confirmed that it will be launching brand new exchange-traded funds (ETFs) that focus on both cryptocurrencies and the metaverse.

According to a press release on Tuesday, the firm will launch two brand new ETFs which will be called Fidelity Crypto Industry and Digital Payments ETF (FDIG) and Fidelity Metaverse ETF (FMET). Alongside two ETFs, the investment firm will also launch five new fixed income sustainable funds and ETFs. 

The Fidelity Crypto Industry and Digital Payments ETF (FDIG) will offer users the opportunity to gain exposure to companies that are involved with the development of the cryptocurrency ecosystem. This will include trading, cryptocurrency mining, blockchain technology, and digital payment companies. 

In comparison, the Fidelity Metaverse ETF is intended to help investors gain access to all aspects of the manufacture and establishment of the digital metaverse.

Within the press release, Fidelity’s Head of ETF Management & Strategy, Greg Freidman, explained that “Leveraging Fidelity’s decades of investment expertise, we are focused on growing our broad product lineup with innovative strategies that offer choice, value, and new opportunities to investors. We continue to see demand, particularly from young investors, for access to the rapidly growing industries in the digital ecosystem, and these two thematic ETFs offer investors exposure in a familiar investment vehicle.”

Fidelity Investment’s new products are scheduled to be launched on or just after 21 April 2022. 

 

Ripple CEO confirms that XRP lawsuit has gone extremely well

During an interview at the Paris Blockchain Week Summit, Brad Garlinghouse, the CEO of Ripple stated that the ongoing lawsuit had gone far better than he could have hoped when the court case began 15 months ago. 

A lawsuit was brought to Ripple by the Securities and Exchange Commission (SEC) in December 2020. At the time, the SEC argued that Ripple had completed illegal securities offerings of XRP. XRP is the native cryptocurrency of the XRP Ledger, however, the coin is also used for commercial purposes by Ripple. Ripple’s Founders, Garlinghouse and Chris Larsen have always denied any wrongdoing.

The positive statement from Garlinghouse at Blockchain Week may have been prompted by a small win in the lawsuit which occurred at the start of the week. On Monday a judge ruled that the SEC could not edit the contents of emails that highlighted there were conflicts of interest between how the organization dealt with XRP and other cryptocurrencies such as ETH.

Garlinghouse stated that the ongoing lawsuit was far bigger than just Ripple and XRP. “This case is important, not just for Ripple; it’s important for the entire crypto industry in the United States. It would really be negative for crypto in the United States.”

He continued, “if Ripple loses, most tokens trading on platforms in the U.S. would be deemed securities meaning those platforms would have to register with the SEC as broker-dealers. That’s cost, that’s friction. If you determine XRP as a security of Ripple, we have to know every person that owns XRP. That’s an SEC requirement. You have to know all of your shareholders. It’s not possible.”

 

Ethereum Merge postponed to Q3/Q4

The Merge, which is the name given to the moment that Ethereum will transition from a Proof-of-Work blockchain to Proof-of-Stake, has been postponed by Ethereum developers. 

According to the Ethereum website, although the Merge had been scheduled to take place in Q2 2022, the Merge has now been pushed back to Q3/Q4 of 2022. No firm date has yet been provided.

The news was initially announced by Tim Beiko, one of Ethereum’s core developers. After releasing a development update for the blockchain, Beiko confirmed that “It [the Merge] won’t be June, but likely in the few months after. No firm date yet, but we’re definitely in the final chapter of PoW on Ethereum”

Although frustrated by news that the upgrade had once again been postponed, several community members and institutions still theorize that the Merge will have a positive impact on the price of ETH. In early April, analysts at Bloomberg Intelligence released a discounted cash flow model for ETH, which estimated that ETH could reach $9,000 in the most optimistic scenario.

In addition to the pushback of the Merge, Ethereum experienced a significant increase in mining activity as miners try to capture as much profitability before the network transfers to PoS. Alongside notice that the Merge was postponed, Beiko also warned against users purchasing Ethereum mining equipment, hinting that the equipment will become redundant within the year.

 

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