Block Commits to Monthly Bitcoin Purchases

The Breakdown First Five - Friday, May 3, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Lawmakers Urge Options

Representatives Nickel and Flood have urged the SEC to approve Bitcoin ETF options. The derivatives have been held back since the January ETF launch without a clear explanation. Typically, ETF options go live within a few days of the underlying product and without controversy. The Congressmen noted that ETFs are usually uncontroversial and asked for an explanation of the delay. “Why the difference in treatment?" 

4. Coinbase Monster Earnings

Coinbase has recorded another dramatic beat on earnings. The exchange reported $1.6B in quarterly transaction volume, up from $736 in Q1 of last year. $1.6B in overall revenue, up 72% from the previous quarter. Net Income at $1.18B. EBITDA at $1B. Generated earnings of $4.04 per share blowing Wall Street estimates of $1.15 out of the water. Coinbase credited “product expansion, continued operational discipline, and strong market conditions." 

3. Tether Partners with Chainalysis

As the regulatory pressure on Tether mounts, the firm has announced a surveillance partnership with Chainalysis. Tether claims the monitoring system will allow them to better identify crypto addresses linked to sanctions evasion and illicit activity. The move comes after a recent increase in Tether concerns published in mainstream financial media, UN reports and letters penned by Elizabeth Warren.

2. Former SEC Litigator: No Plan to Kill Crypto

The SEC’s former top litigator has said there was “no systemic plan to kill crypto”. Ladan Stewart has recently left the agency to join a major private law firm and says that all she saw during her time at the SEC was “a true concern that the lack of compliance” which was harmful to investors. Stewarts press tour has reignited calls to black ball former SEC staff. 

1. Block Adds More Bitcoin

Jack Dorsey led fintech Block will add more Bitcoin to the balance sheet. The firm announced plans to purchase Bitcoin using 10% of Bitcoin-related earnings each month. Block has already executed this DCA strategy in April and plans to continue throughout the rest of this year. The firm already owns around 8,000 Bitcoin valued at roughly $4.7B. Block hopes this strategy can be a blueprint for other corporates and has released documentation on their approach.