Blockchain Bites: MicroStrategy’s BTC Buy, Bitmain’s Power Struggle, Paxful’s Goodbye

Blockchain Bites: MicroStrategy’s BTC Buy, Bitmain’s Power Struggle, Paxful’s Goodbye

MicroStrategy has put even more of its treasury into bitcoin, Paxful is pulling out of Venezuela and the Bitmain power struggle appears to have found a short-term solution. 

Top shelf

Bitcoin buy
MicroStrategy, a business intelligence company, told the U.S. Securities and Exchange Commission on Monday it “may increase” its BTC holdings beyond the $250 million haul purchased in August. The morning after: it did. Microstrategy has acquired an additional $175 million worth of BTC in a single purchase. These blockbuster buys transformed much of MicroStrategy’s cash reserves into bitcoin, placing the Nasdaq-traded firm among Wall Street’s most notable bitcoin bulls. Future allocations would continue down the treasury allocation path. On Sept. 11, the board formally recognized bitcoin as MicroStrategy’s “primary treasury reserve asset on an ongoing basis.”

Binance abets?
Binance has been accused of “aiding and abetting” the theft of $60 million in cryptocurrency in 2018. Crypto exchange Zaif, now called Fisco, has said hackers transferred 1,451 bitcoin (~$9.4 million at the time) to an address belonging to Binance and used the exchange’s minimal know-your-customer and trading procedures to launder the money. The exchange is now seeking repayment for the allegedly laundered funds and other damages. Interestingly, Fisco is bringing the case in a California district court in part because “critical components” of Binance’s business, such as its AWS servers, are located in the U.S. state.

Power struggle
Has Bitmain’s power struggle come to an end? An updated Chinese business registration record shows co-founder Jihan Wu is once again legal representative and executive director of the bitcoin (BTC) miner maker giant, replacing rival co-founder Micree Zhan. CoinDesk’s Wolfie Zhou has reported Zhan was ousted from the company last October but regained control earlier this year. He remains a general manager of the firm, according to the business record. “Since 2020, the management’s feud has damaged Bitmain’s market shares and its brand image. We have lost customers and employees were forced to take sides,” Bitmain said in a post. While it seems things are settling down, the two co-founders are still engaged in a legal battle in the Cayman Island courts. 

Goodbye market
“Increasingly strict” regulations are to blame of Paxful’s decision to pull out of the Venezeulan crypto market, according to a video tweeted Monday. The P2P exchange has suspended account creation and has said existing users will have 30 days to withdraw their funds. Paxful was Venezuela’s second-largest P2P outlet, CoinDesk’ Danny Nelson reports, adding the nation’s crypto traders heavily favor P2P crypto exchanges like market leader LocalBitcoins over government-approved alternatives. Rampant inflation, unbanked population and high mobile phone usage have long appealed to the company, CEO Ray Youssef said, but ultimately local regulations and U.S. sanctions prevailed.

Testy about tether
The New York Attorney General’s office is losing patience with Bitfinex and Tether in a long-simmering legal battle. NYAG Senior Enforcement Counsel John Castiglione filed a letter Monday calling for the crypto firms to comply with a 17-month-old document production order detailing financial information within the next two months. The watchdog is looking for communications about Tether’s loans, loans to third parties and a list of U.S. or New York customers who had funds on Crypto Capital, a bank allegedly at the center of the investigation into the loss of  $1 billion in customer funds. Defendants responded saying the injunction was overly broad, saying asking for information about all tethers is like “asking GM for all documents about cars.”

Quick bites

At stake

File away?
Filecoin, the much-anticipated distributed file sharing protocol, is nearing its mainnet launch. 

After years of development, funded by a $257 million initial coin offering in 2017, the project that looks to unseat the dominant cloud services business – Amazon, Microsoft and Google – and content delivery networks like Cloudflare is targeting mid-September for launch.

CoinDesk’s Brady Dale reports Filecoin is entering the

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