Custodia's Attempt for Fed Account Rejected

The Breakdown First Five - Monday, April 1, 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. Huge Month for Venture

Crypto venture funding is back, hitting an 18-month high.$1.4B was deployed in March with over 20 Series A deals driving funding to newer startups. The most high profile deal currently in the works is a Paradigm led investment into Farcaster. Reports suggest the decentralized social media platform would be valued at $1B, birthing the latest Web 3 unicorn. 

4. Thanks Tim

An angel investing platform stealth launched by Jordan Fish aka Cobie has been thrust into the spotlight. The platform, known as Echo, is intended to “level the playing field and increase access to early stage crypto investing”. The website has been inundated with applications since it went live. The first deal was closed over the weekend, a $300,000 placement into synthetic dollar protocol Ethena. 

3. Base Jumping

Coinbase’s layer 2 network Base saw record trading volume with $1.2B in dex transactions. That’s about 20% of average daily volume on the centralized exchange. The increase has been driven by multiple hyped up memecoins, but could lay the groundwork for an onchain push once more substantive projects are launched on the network. If volumes continue at these levels, Coinbase will be reaping hundreds of millions in sequencer fees annually. 

2. Yusko: $150K Bitcoin

Hedge fund manager Mark Yusko is the latest to call for $150,000 Bitcoin during this cycle. Yusko said he expects Bitcoin to go “parabolic” later this year. He’s predicting the top to come nine months after the halving, mirroring previous cycles. Essentially Yusko’s prediction is that this time is not different and that the early ETF-fuelled runup will not dampen the cycle. 

1. Custodia Loses

Custodia Bank has lost their battle to gain access to a Fed master account. The crypto-adjacent full reserve bank claimed that they meet the requirements to access Fed payments and settlement infrastructure which was being unreasonably withheld. A judge disagreed, finding that Custodia’s argument would essentially mean that every state chartered bank is guaranteed access.