Cryptocurrencies had a strong week, with cardano reaching a new all-time high on Friday and most cryptocurrencies rising on strong demand.
News that cryptocurrency traders will take action against Binance was overshadowed by positive announcements this week, such as Wells Fargo becoming the latest US bank to have some indirect involvement with cryptocurrencies, and Coinbase purchasing more than $500m of cryptocurrency.
Here are the top stories that caught our eye.
Wells Fargo registered a private bitcoin fund on Thursday with US regulators
Wells Fargo is one of the latest major banks to home in on the cryptocurrency frenzy and offer them in some way to its wealthy clients.
The fund will be called “FS NYDIG Bitcoin Fund I,” shows the filing with the US regulator, the Securities Exchange Commission. Coindesk reports that the fund will be a pooled passive investment fund.
NYDIG stands for New New York Digital Investment Group and is owned by Stone Ridge Asset Management. Stone Ridge Asset Management. NYDIG also teamed up with JPMorgan to create a bitcoin fund earlier this year. JPMorgan’s passive bitcoin fund’s filing also took place on Thursday.
Traders brace for $5m challenge against Binance
Liti Capital, a Swiss litigation finance company, has committed a minimum of $5m towards an international arbitration case against Binance, the world’s largest cryptocurrency exchange.
Six investors ranging from Australia, France, the US and Ukraine say their claims amount to more than $20m. They are hoping more traders will come on board and claim against the exchange. Traders say they suffered huge losses on 19 May after a global outage resulting from China’s regulatory actions.
On 19 May, Chinese authorities triggered sharp volatility in cryptocurrency markets after they said that digital currencies shouldn’t be used as payment, and banned financial institutions from providing cryptocurrency services.
The resulting volatility triggered an outage and huge losses for some investors as Binance automatically liquidates clients’ futures if losses breach a certain amount.
The case will be closely watched by crypto enthusiasts as it will affirm whether Binance, which has no headquarters and operates through a complicated global network of legal entities, can be held to account.
More than $215m worth of ether has been “burned” since network upgrade
More than $215m worth of ether has been burned – taken out of circulation – since a major update to the network’s fee system took place on 5 August.
Since Wednesday, more than 67,000 tokens of ether, the native cryptocurrency behind Ethereum, have been burned, shows data by tracking website Watch the Burn.
EIP-1559, an update to the Ethereum network which aims to make transaction fees less volatile and includes a feature to burn fees, kicked in at the start of the month.
It was prompted by the fact that fees for ether transactions (called “gas”) were apt to fluctuate wildly, leaving users to guess how many tokens an ether transaction would use, which undermined the network’s efficiency.
Now with the network update in place, users will pay a base fee instead, which will be determined through algorithms depending on how busy the network is. Users can also pay a tip to the miner to have their transaction processed faster than other users who do not opt to tip.
Crypto markets update
Here’s what happened in the cryptocurrency markets over the last seven days
- Bitcoin rose 7.6% to $47,051.
- Ether rose 7% to $3,207.
- Dogecoin rose 23% to $0.31.
- Cardano rose 40% to $2.43.
- Binance Coin rose 13% to $430.
What investors need to watch out for
The Binance Arbitration case. Cryptocurrency prices could take a short-term hit if Binance is forced to compensate investors.