updraftplus domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131hustle domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131wpforms-lite domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131$2 trillion Norges Bank Investment Management, the world’s largest sovereign wealth fund, has disclosed unanimous support for all five management proposals of Bitcoin treasury Metaplanet. The stock bounces 1.51% on Wednesday amid a slight BTC price rebound. Norges Bank Votes in Favor of Bitcoin Treasury Metaplanet Proposals Metaplanet, aka Asia’s MicroStrategy, has secured a major
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]]>In the latest episode of the podcast “The Bitcoin Layer,” Daniel Batten, a recognized advocate for Bitcoin, discussed the potential impact of sovereign wealth funds (SWFs) on the Bitcoin price, predicting a rise to over $148,000 per BTC should these funds decide to invest even a minimal fraction of their assets. With $35.7 trillion under management between SWFs and public pension funds, a 1% allocation could have a significant impact on Bitcoin’s valuation.
Batten’s analysis hinges on the sheer scale of assets managed by SWFs and public pension funds, noting that even a fractional investment compared to their total assets could have a profound impact on the market. He explained, “If a 1% deployment into Bitcoin were to happen, we can calculate based on the current ratio of dollar invested to market cap increase that it would lift Bitcoin price to over $148,000.”
The primary roadblock, according to Batten, is not a lack of interest but a lack of permissible investment frameworks within these funds, particularly concerning ESG (Environmental, Social, and Governance) criteria. “All of the Sovereign wealth funds want to invest into Bitcoin. It’s not through lack of want,” Batten quoted Kevin O’Leary, highlighting that these funds are currently constrained by their ESG investment committees. These committees are yet to be convinced of Bitcoin’s environmental credentials, which Batten believes are now significantly more positive than the general perception, marred by outdated information.
Batten suggested that the ESG criteria, which are a significant factor in investment decisions for SWFs, are based on data that is at least three years old, and no longer accurately reflects the current state of Bitcoin mining technology and its environmental impact. “There’s a massive knowledge asymmetry where the knowledge that we now have about Bitcoin and its environmental benefits is now so different to what the ESG investment Committees of sovereign wealth funds believe about Bitcoin,” he stated.
In response to these challenges, Batten has not only conducted research but also begun direct engagement with SWFs, aiming to educate and update their ESG committees about the latest developments in Bitcoin’s environmental impact. His goal is to realign the outdated perceptions with current realities, thereby removing the barriers to their investment in Bitcoin.
Supporting his theory, Batten pointed to recent investments by state pension plans in the US, such as those by Wisconsin and Michigan, which, despite being small in scale, had significant media impact and positively influenced market perceptions. “Wisconsin invested […] a total through Grayscale mainly. I believe their current position is around $160 million; that’s nothing compared to their total AUM […] however, even that very small allocation […] had a major impact on Bitcoin price that day,” Batten remarked.
Overall, Batten believes that SWF’s can not only contribute to a Bitcoin bull run, but they can also help stabilize and legitimize the market for broader, more conservative investment audiences. Moreover, he believes that it’s more likely that WSF’s will invest in Bitcoin than having another major nation state or big company like MicroStrategy.
He concluded, “Yes there is a blocker and there is effort required to go through it and it is hard but it’s nowhere near as hard in my view as convincing a nation state to adopt Bitcoin. So this is an area where whilst it’s hard, it’s not as hard as other areas and it’s also that there’s only one blocker there’s not a whole bunch of them and in most cases that is the ESG investment committee.”
At press time, BTC traded at $58,500.
Featured image created with DALL.E, chart from TradingView.com
Institutional investors are increasingly eyeing spot Bitcoin exchange-traded funds (ETFs), as observed by BlackRock, the world’s largest asset manager. Robert Mitchnick, BlackRock’s head of digital assets, anticipates a surge in participation from sovereign wealth funds, pension funds, and endowments in Bitcoin ETFs in the near future. This shift signals a broader acceptance and recognition of cryptocurrencies as legitimate investment assets within the institutional space.
BlackRock emphasizes its pivotal role in educating institutional investors about Bitcoin’s relevance in portfolio construction, underscoring the importance of understanding and integrating digital assets into diversified investment strategies. Notable investments, such as BNP Paribas’ recent purchase of units in BlackRock’s Bitcoin ETF, serve as tangible evidence of the growing institutional appetite for exposure to the cryptocurrency market, highlighting a significant milestone in the adoption journey of digital assets by traditional financial institutions.
The approval of Bitcoin ETFs in January has catalyzed a significant influx of investment, with over $76 billion allocated across various products, marking a notable milestone in the evolution of the cryptocurrency market. BlackRock’s IBIT ETF and Grayscale’s GBTC emerge as prominent contenders in the Bitcoin ETF landscape, boasting impressive assets under management (AUM) figures of $17.2 billion and $24.3 billion, respectively.
Social media scrutiny intensifies as attention is drawn to the competitive dynamics between IBIT and GBTC, with analysts closely monitoring factors such as AUM growth rates and market sentiment. The growth trajectory of Bitcoin ETFs is further fueled by a confluence of factors, including Grayscale substitutions, international capital inflows, and the transition of investors from futures-based products to spot ETFs, reflecting a maturing and increasingly sophisticated investor base within the cryptocurrency ecosystem.
Also Read: Ripple Vs. SEC: What To Expect From Ripple’s Reply As XRP Price Jumps 4%
BlackRock’s forward-thinking approach becomes evident through its strategic move to file for an Ether (ETH) ETF in November, signaling the company’s commitment to expanding its cryptocurrency offerings beyond Bitcoin. CEO Larry Fink’s vocal endorsement of tokenization underscores BlackRock’s confidence in the transformative potential of blockchain-based assets, further legitimizing the burgeoning digital asset class within mainstream finance.
Mitchnick emphasizes the interconnected nature of digital assets, stablecoins, and tokenization, highlighting BlackRock’s holistic approach to navigating the evolving landscape of decentralized finance (DeFi). However, BlackRock’s venture into Ethereum ETFs raises pertinent questions about the intricacies of educating clients on the nuances of the Ethereum blockchain ecosystem and the rationale behind diversifying investment portfolios with exposure to multiple cryptocurrency ETFs.
Also Read: VanEck Exec Slams Biden Govt For Hindering DeFi & Crypto Market Growth
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
As the largest sovereign wealth fund worldwide, the Norways’s Government Pension Fund Global boasts a robust portfolio across different sectors within the financial market.
Norway’s Government Pension Fund Global, created in the 1990s to manage surplus revenues from the country’s thriving oil and gas sector, faced significant hurdles in its third quarter financial revenues ending September 2023.
In an announcement on Tuesday, the Norges Bank Investment Management said the fund, which represents the largest sovereign wealth fund worldwide, experienced a significant loss of a 2.1% decrease in revenue during the just concluded quarter.
All asset classes owned by the fund took a hit, resulting in a substantial 374 billion Norwegian kroner (equivalent to $34 billion) loss during the last three months, compared to the positive trend observed in the year’s first half.
Despite the downturn, the fund performed slightly better than its benchmark index, achieving a return of 0.17 percentage points above the index, equivalent to 27 billion kroner.
However, it is crucial to note that the third-quarter results mark the fund’s first quarterly loss in the last year despite its relatively resilient performance.
The poor performance signifies the ongoing turbulence grappling the global financial markets as many industries face financial crises.
Deputy chief executive of Norges Bank Investment Management, Trond Grande, pointed out that the tech, industrial, and consumer discretionary sectors contributed to the negative return. According to him, the overall weaker stock market in the quarter was a key factor in the decline.
“The stock market saw a weaker quarter compared to the two previous quarters. It was particularly the tech, industrial, and consumer discretionary sectors that contributed negatively to the return”, said Grande.
As the largest sovereign wealth fund worldwide, the Norways’s Government Pension Fund Global boasts a robust portfolio across different sectors within the financial market.
With a diverse portfolio, the fund has invested in over 9,200 companies across 70 countries. Notably, the Government Pension Fund Global observed a 3.3% loss in unlisted real estate and a 2.4% loss in renewable energy infrastructure investments during the third quarter.
According to the report, equities accounted for 70.6% of the fund’s investments by the end of the third quarter, slightly lower than the previous quarter, reflecting the fund’s diversified portfolio strategy.
As of 30 September 2023, the fund’s total value stood at a substantial 14,801 billion kroner. Equities formed the bulk of investments at 70.6%, followed by fixed income at 27.1%, and a smaller allocation of 2.2% in unlisted real estate and 0.1% in unlisted renewable energy infrastructure.
Other market news can be found here.
Chimamanda is a crypto enthusiast and experienced writer focusing on the dynamic world of cryptocurrencies. She joined the industry in 2019 and has since developed an interest in the emerging economy. She combines her passion for blockchain technology with her love for travel and food, bringing a fresh and engaging perspective to her work.
Saudi Arabia’s investment fund has reported a heavy loss worth billions of dollars from economic factors that reduced its many investments.
The sovereign wealth fund in Saudi Arabia announced that it took a comprehensive loss in 2022 worth $15.6 billion. The loss came following an economic decline that caused a significant plunge in the value of the fund’s investments in SoftBank Group’s SoftBank Vision Fund.
Last month, Saudi Arabia announced that its Public Investment Fund (PIF) lost $11 billion following unprofitable investments last year. Although the fund increased its global spending allegedly to secure more investments, a crash in the prices of stocks and bonds affected the PIF. Interestingly, the recorded loss was way off the $19 billion profit from 2021 following the market recovery that succeeded the coronavirus pandemic.
In addition to the $11 billion, PIF announced further losses in taxes, expenses, and operational costs, according to a recent annual financial report.
The Saudi fund has recently been pumping funds into a lot of investments it hopes would bring profit rather than unfortunate loss. In 2018, American EV maker Lucid Motors announced a $1bn+ agreement with the PIF via a special-purpose vehicle wholly owned by the fund.
In May, Lucid Group also announced it would use a stock offering to raise $3 billion, with nearly two-thirds of the funds coming from the PIF. The Saudi fund owns over 60% of Lucid and agreed to spend $1.8 billion on 265.7 million shares of Lucid via a private placement.
In addition to EV endeavors, Saudi’s PIF is also looking into the video game industry. Through its subsidiary, Savvy Games Group, the PIF plans to publish games and turn the country’s capital of Riyadh into a vibrant gaming hub. So far, PIF has acquired billion-dollar stakes in gaming giants like Activision Blizzard Inc., Tencent Holdings Ltd., and Nintendo Co.
The government-owned Temasek Holdings Pte in Singapore recently reported its worst return in 7 years. Like the PIF, Temasek is suffering the ill effects of global recession risks, geopolitical conflicts, especially with Russia and Ukraine, high interest rates, and the general economic downturn worldwide.
Temasek said the net value of its investments fell to S$382 billion (US$285 billion) in the financial year to March compared to a record S$403 billion recorded the previous year. The company also announced a 5.07% fall in total shareholder returns. This is a continuous year-over-year (YoY) reduction compared to a 5.8% increase in 2022, and 2021’s 24.5% rise.
Temasek was also affected by the FTX collapse and eventually wrote down its investment in the company worth $275 million. The investment company had invested $210 million in FTX International, and another $65 million in FTX US.
According to Temasek’s chief investment officer Rohit Sipahimalani, economic factors still need work. Sipahimalani said:
“The global economy is still quite fragile. Geopolitical tensions are high, showing no signs of easing. Inflation is elevated in most developed markets…we do believe that to get inflation under control, we probably will need to see a recession.”
As several countries continue to fight inflation using interest rate hikes and other similar macroeconomic decisions, outfits like Temasek and PIF may record more losses until the risks abate.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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FTX’s sister trading firm Alameda has agreed to sell its interest in Sequoia Capital to a UAE-based entity.
Alameda Research appears set to sell its interest in Sequoia Capital to Abu Dhabi for $45 million. According to a recent report, the FTX sister trading firm agreed to sell the Sequoia stake to the Abu Dhabi sovereign wealth fund in cash.
A March 8th United States Bankruptcy Court for the District of Delaware document detailed the sale agreement between Alameda and Abu Dhabi. Part of this filing read:
“[FTX] decided to enter into the Agreement with Purchaser based on its superior offer and ability to execute the Sale Transaction within a short time frame.”
The document also revealed that FTX/Alameda agreed to sell to Abu Dhabi after mulling over interest from four different parties. Furthermore, the court document stated that Alameda’s share buyer, Al Nawwar Investments RSC Limited, is owned by the government of Abu Dhabi. According to reports, the United Arab Emirates-based buyer is already an investor in Sequoia.
The $45 million all-cash deal could close by the end of this month. However, the sale remains subject to approval by the Delaware court bankruptcy judge John Dorsey.
FTX’s attempt to offload its remaining interest in Sequoia Capital is one of a few plans the fallen company hopes will help pay off creditors. The Sequoia interest sale development also reflects concerted efforts by the Alameda/FTX insolvency management to recover assets and funds owned by the exchange.
Dorsey has presided over aspects of FTX’s legal cases following the exchange’s collapse and subsequent bankruptcy filing last November. The Delaware bankruptcy judge granted Bahamian-based FTX permission to sell off some of its assets following its insolvency declaration.
Assets listed for sale included FTX’s stock-clearing platform Embed, and its derivatives platform LedgerX. In addition, the sunken crypto exchange also sought to sell its regional branches, FTX Europe and FTX Japan.
In a related case, court documents revealed that Dorsey mandated defunct crypto brokerage company Voyager Digital to set aside $445 million. This ruling came on the heels of a lawsuit by Alameda Research against the company regarding loan repayments.
In January, reports stated that FTX recovered more than $5 billion in cash and liquid crypto assets amid its bankruptcy case. The embattled exchange revealed plans to rebuild its transaction history at the time. In addition, FTX also said that it was still trying to ascertain the total amount of customer shortfall.
Earlier this week, FTX sued leading crypto asset management firm Grayscale Investments to access $9 billion of shareholder value. In the lawsuit, the once second-largest crypto exchange alleged that Grayscale had charged outrageous management fees. According to FTX:
“Grayscale has for years hidden behind contrived excuses to prevent shareholders from redeeming their shares. Grayscale’s actions have resulted in the Trust’s shares trading at approximately a 50% discount to Net Asset Value. If Grayscale reduced its fees and stopped improperly preventing redemptions, the FTX Debtors’ shares would be worth at least $550 million, approximately 90% more than the current value of the FTX Debtors’ shares today”.
However, Grayscale described FTX’s lawsuit as “misguided” and claimed transparency in obtaining regulatory approval to convert GBTC into an ETF.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
Bitcoin has grown from being ‘internet money’ used by only a few thousand people during its first few years to being part of the balance sheets of big companies and sovereign states. El Salvador is a case in point for a country that has committed fully to the bitcoin mission, putting millions of dollars into the digital asset as a national reserve.
While bitcoin is still a long way from being the de facto reserve currency of all countries, its growth points to countries not being able to ignore it for much longer. That’s why it is expected that more nation-states will purchase the cryptocurrency in the next year.
In a recent report published by Fidelity, it goes into depth about bitcoin and the role it may play in deciding which countries are the economic leaders of the world. This is because as the asset becomes more widely spread as a reserve currency, the countries who hold bitcoin may see their influence grow higher than those who do not, despite where they might stand today.
Related Reading | Jack Dorsey Launches Bitcoin Defense Fund To Aid Devs Facing Litigation
History has always shown that those who are quick to accept innovation and new technology have always ended up faring better compared to those who do not, and that may well be the case with bitcoin and other cryptocurrencies.
Fidelity also refers to it as a “very high stakes game theory.” If bitcoin adoption continues to grow, then those who got in earlier will no doubt be better off than the rest. This will push other countries to also acquire the digital asset as “insurance” so as to not be left behind even if they do not believe in the investment thesis or the adoption of the digital asset.
Basically, sovereign nation-states would purchase bitcoin sort of as a hedge, in case it does end up being important in the future. “In other words, a small cost can be paid today as a hedge compared to a potentially much larger cost years in the future.”
Touching on the ban debate that has raged on in the space, the report explained that banning bitcoin outright would be hard to achieve. Although not impossible, it could certainly lead to a significant loss of wealth and opportunity, it added.
Related Reading | Highlighting Risk: These Crypto Coins Carry The Most Leverage
There is yet to be an all-encompassing bill passed in regards to cryptocurrencies which provides total regulatory clarity. The infrastructure bill which was passed last year and scheduled to go into effect in 2024 continues to be subjected to numerous amendments, and with such a long time frame till implementation, there is no telling where the bill might end up.
However, Fidelity noted in its report that a digital asset regulation being passed into law will be a milestone for bitcoin, stating that “what we think is most notable is that digital asset regulation becoming law is another milestone as the asset class comes of age and establishes itself.”
BTC trending above $43K | Source: BTCUSD on TradingView.com
Featured image from Bitcoin News, chart from TradingView.com
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