ETH surge being led by Asian market

Bitdeer Records Revenue Growth Amid Q2 LossesSingapore-based crypto mining company, Bitdeer, experienced a notable boost in cash flow during Q2 2023. However, this upswing was counterbalanced by substantial acquisition costs and share-based compensation expenses.It’s been a mixed couple of days for Bitdeer. On Thursday it emerged that the company had struck a deal with B.Riley Financial that has seen the financial services firm sign a $150 million share purchase options agreement with Bitdeer. Twenty-four hours later, there’s further good news in that the firm has increased its mining hash rate. However, it has also recorded a significant loss for Q2, 2023.Photo by David Clarke on UnsplashHash rate increaseIn its recent earnings report released on Friday, Bitdeer revealed a remarkable increase in its mining hash rate. The figures surged from 2.1 exahashes per second to an impressive 3.8 exahashes per second throughout the second quarter of 2023 by comparison with the same period in 2022. Furthermore, Bitdeer’s self-mining operations yielded 758 bitcoins in contrast to 521 bitcoins mined during the same period in the preceding year.This surge in hashing power contributed to a Q2 revenue of $93.8 million, marking a 5% year-over-year increase. Bitdeer attributed this revenue growth to its bolstered hashing power, setting a solid foundation for its financial performance.Linghui Kong, CEO of Bitdeer, shed light on pivotal developments driving the company’s growth trajectory. Kong highlighted the successful completion of the mining site in Bhutan and the establishment of a cutting-edge immersion cooling data center.Operational expansionKong emphasized: “Our 100MW mining datacenter in Bhutan is in the process of power-on testing, and the mining machines are beginning stable operation.” Additionally, he mentioned that a 175MW immersion cooling data center is currently under construction at the Tydal mining facility in Norway, with an expected completion date of 2025.Bitdeer’s expansion endeavors have led to a significant increase in its mining operations. The company now manages 199,000 mining machines, a considerable rise from the previous year’s count of 119,000. Over the past year, Bitdeer’s business model has evolved, with a majority of machines being hosted rather than self-owned.Despite the growth in operations, Bitdeer reported a net loss of $40.4 million in Q2, marking a substantial increase from the previous year’s quarterly loss of $15.6 million.Merger overheadThe Q2 losses were largely attributed to Bitdeer’s merger with the special purpose acquisition company (SPAC), Blue Safari Group Acquisition Corp. Notably, the listing fee alone for this merger amounted to $33.2 million, and share-based payment expenses added up to $9.6 million during the quarter.Bitdeer’s stock had experienced a 26% decline in the 30 days leading up to the report. However, the losses were quickly recouped, with the stock rallying by over 27% on the day of the report’s publication. This market response underscores the dynamic nature of the cryptocurrency sector and the investor sentiment surrounding it.Bitdeer’s Q2 performance showcases the company’s revenue growth propelled by enhanced hashing power. The expansion of its mining operations, coupled with strategic developments like the Bhutan mining site and immersion cooling data center, position Bitdeer for further growth.

Illicit Crypto Activities Estimated to Have Surpassed $100 Billion in S.E. AsiaA recent analysis by blockchain analytics firm Bitrace has found that over $100 billion worth of digital currency has been used in illicit crypto trading activities in Southeast Asia.Photo by Bermix Studio on UnsplashThe firm provided details of its analysis via X (formerly Twitter) on Monday. The data underscores the extensive scope of unlawful activities involving cryptocurrencies across Southeast Asia. The analysis further revealed that illicit activities involve fraudulent schemes, online gambling, and money laundering.Misuse of digital asset innovationSome of the key characteristics of digital assets include the ability to maintain anonymity, decentralization, and borderless transactions, which are generally considered positive attributes. However, the very nature of decentralized cryptocurrency means that nobody dictates who uses it or the purpose for which someone decides to use it. With that, these characteristics have rendered illegal undertakings not only more covert but also facilitated expedited transfers of pilfered resources.The silver lining, however, rests in the inherent transparency of blockchain ledgers. This quality has enabled Bitrace’s team of encryption analysts to trace funds implicated in illicit ventures through intensive on-chain analysis.Key insightsThe Bitrace research points towards the following key insights:Prevalence of Tether (USDT): The use of USDT has gained prominence in both illicit activities and gambling operations throughout Southeast Asia, with a staggering sum of over 115 billion USDT recorded in 2022 alone.Shift to Top Trading Platforms: USDT is observed to migrate from unlawful platforms within Southeast Asia towards top-tier trading platforms. Particularly favored by operators and gamblers, a significant proportion hails from the Chinese demographic, consistently gravitating towards specific exchanges.Inflow into Trading Platforms: A noteworthy development emerges as over 14.6 billion USDT prepares to traverse into trading platform accounts. The mounting risk factor diffuses across an expanding spectrum of addresses and platforms.Likely consequencesIf this blockchain analysis is found to be accurate, there are likely to be ramifications for all projects operating in the digital assets, DeFi and Web3 space. It comes at a time when the focus on the regulation of crypto-related businesses is more intense than ever before.Anti-Money Laundering (AML) and Know Your Transaction (KYT) legislation are cornerstone financial services regulations that have been established on a global basis. If these regulations are being flouted, and crypto is being used as a means to circumvent them, there’s a real risk that regulation could be applied heavy-handedly to counteract that threat of widespread illicit activity.Global crypto exchange Binance has faced criticism in this context, with a suggestion in March that its Turkey-based exchange service had been used by an organization connected with militant group Hamas for money laundering and terrorist financing.In a report last week, Binance claimed that it shared information with authorities that led to the capture of senior ISIS members. More such cooperation will likely be necessary to prevent the sector being subject to overzealous regulation.

India is strategically navigating the development of its digital rupee, with the Reserve Bank (RBI) actively addressing privacy concerns through technological solutions in its central bank digital currency (CBDC) pilot programs. According to a recent report by CoinDesk, a senior official with insights into these initiatives revealed that while progress is evident, the RBI is proactively exploring ways to ensure privacy in the use of the digital rupee.Photo by Julian Yu on UnsplashPursuing mechanisms to maintain anonymityThe RBI has introduced a new dimension to the discourse on privacy concerns associated with CBDC usage. The central bank official suggested that the RBI may seek legal backing from India’s finance ministry to enact legislation allowing customers to delete transactions for the purpose of maintaining anonymity. New-found urgencyPublic statements from the RBI suggested a lack of urgency in implementing a full-scale retail CBDC, coupled with a reluctance to provide a specific timeline. However, recent events indicate that an underlying sense of urgency may be emerging. In the past month, the retail CBDC achieved a notable milestone, processing one million transactions in a single day, with support from various banks. Several banks, including HDFC Bank, Kotak Mahindra Bank, Axis Bank, Canara Bank, IDFC First Bank and Union Bank of India, reportedly encouraged their employees to deposit funds in CBDC instead of fiat currency, contributing to this achievement. The official overseeing the CBDC development emphasized the necessity for experimentation and substantial efforts to ensure the security of the digital currency. While the settlement aspect is considered straightforward, addressing latency remains a priority for the RBI. No mandate on taxThe RBI, historically known for its opposition to crypto both domestically and globally, clarified that crypto taxation is not within its mandate. This clarification suggests that the RBI might not object if the Indian government decides to reduce the stringent taxes currently imposed on cryptocurrencies. The central bank clarified that it lacks the mandate to express a viewpoint on reducing a contentious tax that has stirred debate within the crypto industry. The RBI has been a driving force behind the adoption of wholesale and retail CBDC since late 2022 when it initiated pilot programs. The official emphasized that taxation matters fall under the government’s purview, reinforcing the RBI’s focus on its designated responsibilities. Similarly, the country’s judiciary recently turned down a plea to have it formulate a crypto regulatory framework, outlining that this too is up to the government to address. The central bank has a historical context of attempting to ban cryptocurrencies, with effective prohibitions in place between 2018 and 2020 until a Supreme Court order overturned the ban. Since then, the RBI has consistently expressed concerns about cryptocurrencies in various forums, including the Group of 20, where India played a leading role in coordinating global regulation in the crypto space. Recent utterances from the RBI governor, Shaktikanta Das, suggest that the regulator is disinterested in seeing the offering of spot crypto exchange-traded funds (ETFs) in India despite that eventuality coming to pass last month in the United States. Das also spoke positively recently about the tokenization of real-world assets using blockchain technology.