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The Wolf Den #572 - Forbes Finds Unsettling Data

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September 2 · Issue #572 · View online
The Wolf Den Crypto Newsletter
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In This Issue:
  1. Forbes Finds Unsettling Data
  2. Legacy Markets
  3. Regulators Probe Binance
  4. Crypto.com Backs Out Of Champions League Sponsorship
  5. Celsius Is Ready To Return $48M
  6. This Guy Invented Digital Currency Way Before Satoshi | David Chaum, xx network
  7. My Recommended Platforms And Tools
Forbes Finds Unsettling Data
I attempted to determine Bitcoin’s 24-hour trading volume across a handful of platforms. And I couldn’t. There is an utter lack of consensus around how much Bitcoin was traded. The discrepancies only begin there. A closer look into market caps, total supplies, and prices will make your head spin. There is endless variance for every metric within the industry. At the time of writing, these are the reported 24-hour volumes across major platforms. 
CoinMarketCap - $30 billion
CoinGecko - $25 billion
Messari - $6.38 billion
CoinStats - $35 billion
So who’s right?
Forbes recently conducted research to determine what’s really going on with Bitcoin’s reported volume. The findings are unsettling. We often wonder why the SEC refuses to approve a Bitcoin ETF. Maybe this is one of the reasons.
In the study, Forbes evaluated 157 exchanges and found that “more than half of all reported trading volume is likely to be fake or non-economic. Forbes estimates the global daily bitcoin volume for the industry was $128 billion on June 14. That is 51% less than the $262 billion one would get by taking the sum of self-reported volume from multiple sources.
So why exactly is this happening? The most likely answer is that volume numbers sell. Retail traders care about sign-up bonuses, but for institutions, order book depth and volume are everything.
More volume = more efficiency = more competitive prices = more institutional interest.
According to Forbes, “Binance, MEXC Global, and Bybit” are the worst offenders. But is it really their fault? The answer is grey, because a lot of the “fake” volume is the result of complicated financial instruments that make reporting volume difficult in the first place. Stablecoins and perpetual futures have made this increasingly difficult for regulators and exchanges to measure. Binance likely plays by the book. CZ has been very vocal about working with regulators, so I doubt their volume is fake, outside of the known wash trading issues that were a result of their no fee promotion.
While working through the study, a few of the findings stood out. Perpetual swaps account for 90% of Bitcoin’s daily trading volume, Binance is the king of the perpetual swap, Tether is the most dominant stablecoin for daily trades by far, and the South Korean Won is taking over as a dominant fiat pair for Bitcoin trading.
All things considered, the daily volume is not an easy metric to track. To further complicate matters, volume is skewed to the largest players rather than equally distributed. “21 exchanges generate the majority of trading volume, and a handful of those account for most of the volume.
The crypto space is still a global experiment, very much in beta form. It is no surprise that volume numbers are all over the map.
To read the full report, click HERE.
THERE WILL BE NO NEWSLETTER ON MONDAY. IT IS A HOLIDAY IN THE US. ENJOY YOUR LONG WEEKEND!
Legacy Markets
Stock Market Today: Dow, S&P Live Updates for Sept. 2 - Bloomberg
Here are some key events to watch this week:
  • ECB Governing Council members due to speak at event Tuesday through Sept. 2
  • US nonfarm payrolls, Friday
  • UK leadership ballot closes Friday. Winner announced Sept. 5
Will Chinese sovereign bonds outperform Treasuries? China is the theme of this week’s MLIV Pulse survey. Click here to participate anonymously.
Some of the main moves in markets:
Stocks
  • Futures on the S&P 500 were unchanged as of 6:15 a.m. New York time
  • Futures on the Nasdaq 100 fell 0.1%
  • Futures on the Dow Jones Industrial Average were little changed
  • The Stoxx Europe 600 rose 0.6%
  • The MSCI World index fell 0.8%
Currencies
  • The Bloomberg Dollar Spot Index fell 0.2%
  • The euro rose 0.6% to $1.0008
  • The British pound rose 0.2% to $1.1572
  • The Japanese yen was little changed at 140.32 per dollar
Bonds
  • The yield on 10-year Treasuries was little changed at 3.26%
  • Germany’s 10-year yield advanced four basis points to 1.60%
  • Britain’s 10-year yield advanced three basis points to 2.91%
Commodities
  • West Texas Intermediate crude rose 2.2% to $88.51 a barrel
  • Gold futures rose 0.5% to $1,717.50 an ounce
Regulators Probe Binance
DOJ Requested Documents From Binance CEO CZ - Crypto Briefing
An ongoing feud between Reuters and Binance has continued to spiral out of control. The most recent story revolves around reports that the DOJ requested documents from CZ and other execs at Binance as part of an ongoing probe into the exchange’s AML and compliance practices. According to Binance, the questioning is part of a “standard process” and the exchange has been voluntarily handing over information for years. The documents were requested in 2020. This is not a new story.
This isn’t the first time that Reuters has criticized Binance. Earlier this year, there were targeted articles around Iran, KYC, and also over $2.3 billion laundered - all of which were refuted by Binance. Bad news sells whether it’s true or not, so I would expect the drama to continue.
Crypto.com Backs Out Of Champions League Sponsorship
Crypto.com Champions League Sponsorship Falls Through - Report
Crypto.com, who already spent $700M on naming rights for an LA arena, were planning on spending $500M to be the main sponsor of the Champions League. The deal was in late stages and slated to cover 5 seasons , but then the bear market happened and Crypto.com accidentally sponsored two sisters in Melbourne for a year… whoops.
Crypto.com claims that the bear market had nothing to do with it, but rather the failure was a result of regulatory issues in England, France and Italy.
Although this deal fell through, expect more massive brand deals in the future. Crypto.com already sponsors the UFC, one of the fastest-growing sports, and will be sponsoring this year’s FIFA World Cup. They also poured $150M into Formula 1.
Celsius Is Ready To Return $48M
Celsius Network to Return Only 22% of Customer Funds - BeInCrypto
According to recent court filings, Celsius owes its customers $4.3 billion. According to attorneys, “the amount held in custody is about $200-$215 million.
That’s a monster gap.
How much are they prepared to return to customers now? $48 million. Let’s hope this has a better ending than appears likely.
This Guy Invented Digital Currency Way Before Satoshi | David Chaum, xx network
Podcast - The Wolf of All Streets
David Chaum, the legendary founder of DigiCash and eCash, a cryptocurrency that predates Bitcoin, stops by to talk about his concerns about Big Tech, privacy, and the future of democracy. 
David, widely known as the “Godfather of Cryptocurrency and Online Privacy”, talks about his fully-encrypted messenger application, the xx messenger, the xx Network, and unveils the vision for his privacy-first ecosystem, Elixxir. This is a can’t-miss episode for anyone interested in the history, application, and future of cryptography.
In this episode with David, we discussed:
  • How to Become a Cryptographer
  • How Cryptography Works
  • Inventing Digital Currency
  • Privacy
  • 3 Pillars of Privacy
  • xx Messanger
  • Elixxir Privacy Platform
  • Big Tech Business Model
My Recommended Platforms, Tools And Podcast Sponsors
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Follow me on Twitter at @scottmelker. This is where I am constantly updating my trades and sharing ideas.
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to “Buy,” “Sell,” or “Hold” an investment.
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