A projection seeing the cryptocurrency space grow into a $3 trillion market by 2025 from Bakkt Holdings is behind the firm’s plan to go public via a merger with Victory Park Capital, a special-purpose acquisition company.

Tether has printed two billion USDT tokens last week, hitting a new record. There are now over 24.6 billion USDT tokens in circulation across several blockchains, with most being on Bitcoin’s Omni Layer, the Ethereum and the TRON blockchains.

The UK’s Financial Conduct Authority (FCA) has told unregistered cryptocurrency firms to close down and return funds to investors, in line with a schedule it laid out at the start of last year.

Sponsored: Crypto.com Exchange is listing NEAR on The Syndicate, where all Crypto.com Coin (CRO) stakers will be able to participate in a discounted sale event for 250,000 USD worth of NEAR at 50% off.

Top stories in the Crypto Roundup today:

• $3 Trillion Crypto Market Projection Behind Bakkt’s SPAC Deal
• Tether Prints Two Billion USDT in Record Week
• UK Financial Regulator Tells Unregistered Crypto Firms to Close
• Sponsored: Crypto.com Exchange is listing NEAR at 50% OFF

$3 Trillion Crypto Market Projection Behind Bakkt’s SPAC Deal

A projection seeing the cryptocurrency space grow into a $3 trillion market by 2025 from Bakkt Holdings is behind the firm’s plan to go public via a merger with Victory Park Capital, a special-purpose acquisition company.

Bakkt is majority-owned by the Intercontinental Exchange, the owner of the New York Stock Exchange, and the deal would value the company at $2.1 billion. Bakkt currently runs a crypto derivatives market and plans to release a new consumer application that allows users to manage digital assets and use them for peer-to-peer payments alongside cash.

In a presentation to investors, Bakkt estimated its revenue, net of transaction-related expenses, could grow by an average of 75% a year to $515 million by 2025, with the firm becoming cash-flow positive by 2023.

The presentation added Bakkt operates in a “massive serviceable addressable market” that in 2020 was worth $1.6 trillion, with $564 billion being the “notional value” of cryptos. By 2025, the presentation projects its target market would grow to $5.1 trillion, including $3 trillion of cryptocurrency.

Tether Prints Two Billion USDT in Record Week

Tether has printed two billion USDT tokens last week, hitting a new record. There are now over 24.6 billion USDT tokens in circulation across several blockchains, with most being on Bitcoin’s Omni Layer, the Ethereum and the TRON blockchains.

The growth reportedly comes from a variety of factors, including a lack of trust in local fiat currencies, and from an aggressive BTC sell-off for USDT which hurt the stablecoin’s peg temporarily. Tether and Bitfinex CTO Paolo Ardoino has said that institutional bitcoin buyers executing over-the-counter orders caused a significant USDT supply growth.

Ardoino was quoted as saying:

“Among Tether customers are all the major OTC desks and high frequency trading firms in the space.”

The ability to use USDT as collateral for “an increasing number of derivatives products” could also be behind the stablecoin’s supply growth, according to Sam Trabucco, a quantitative trader at Alameda Research.

UK Financial Regulator Tells Unregistered Crypto Firms to Close

The UK’s Financial Conduct Authority (FCA) has told unregistered cryptocurrency firms to close down and return funds to investors, in line with a schedule it laid out at the start of last year.

The UK watchdog warned cryptocurrency businesses that hadn’t registered with it by December 15 of 2020 or that had withdrawn an application to cease crypto activities before January 10. In an email sent to companies, the FCA wrote firms should “consider all the relevant issues carefully and, where possible, return any money or cryptoassets” that are related to anti-money laundering rules.

The FCA’s move is part of its anti-money laundering and counter-terrorist financing duty, which it took over early last year. The regulator expects crypto companies to communicate with their customers and provide them “with any alternative options that are in their best interests.”

How Stable are Algorithmic Stablecoins?

Algorithmic stablecoins are coins that use algorithms to balance the circulating supply of the asset. The algorithm issues more coins when price increases and buys them off the market when the price falls.

For example, assume a stablecoin is priced at $1. When the price drops to $0.80, an algorithm recognizes the imbalance between supply and demand, and automatically sets a market buy order to push the price back. In case the price goes above $1, the algorithm sells assets to maintain the price on the predefined level that keeps the peg. 

The top algorithmic stablecoins in terms of market capitalization, are currently Empty Set Dollar (ESD) and Ampleforth (AMPL). Liquidity incentives have recently caused AMPL to lose its peg and rise to $3.

The spike aligned with its launch of  ‘Geyser’ on June 23rd last year — an incentive program that distributed rewards (in AMPL) for users who supplied AMPL-ETH liquidity on Uniswap, a non-custodial decentralized trading platform. 

In addition to earning Liquidity Provider (LP) fees on Uniswap, users who provided AMPL-ETH liquidity could take their LP tokens and stake them on the Geyser platform to earn even more rewards.

It’s important to note algorithmic stablecoins are extremely new and these projects are positioned as experiments to grow and improve the DeFi space. It will be interesting to see over time how they adjust in order to reach the goal of algorithmic stability without collateral or debt supporting it.

Crypto.com Exchange is listing NEAR at 50% OFF

Crypto.com Exchange is listing NEAR on The Syndicate, where all Crypto.com Coin (CRO) stakers will be able to participate in a discounted sale event for 250,000 USD worth of NEAR at 50% off. The event will commence on Tuesday, 19 January 6:00am UTC on the Crypto.com Exchange.

Allocation:

Each participant’s maximum amount of CRO that can be applied towards the listing event will depend on the amount of CRO staked on the Crypto.com Exchange. 

Subscription: 

• Participants will be able to subscribe for NEAR by contributing an amount of CRO tokens not exceeding their respective maximum allocation. Staked CRO tokens may not be used to subscribe for NEAR in this event.
• Participants will need to trade the minimum volume required at their CRO staked level in the past 30 days in order to be eligible to subscribe.
• The past 30-day trading volume is calculated daily at 00:50:00 UTC. For more information regarding exact cutoff times, refer to our FAQ here.

NOTE: The trading volume can take up to 1 hour to calculate at most. To avoid any delays, we advise you to satisfy the trading requirement well in advance of the subscription timelines.

Event Timeline:

• 19 Jan 6:00am UTC: Sales Begins (NEAR/CRO subscription price fixed)
• 20 Jan 6:00am UTC: Sales Ends 
• 27 Jan 6:00am UTC: Acceptance Period Begins (unused CRO will be refunded immediately if you reject the allocation)
• 28 Jan 6:00am UTC: Acceptance Period Ends (CRO refunds will be distributed for forfeited participants)

Sign up for the Crypto.com Exchange, stake CRO and participate in the NEAR sale!

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