A new study by Visa, conducted in collaboration with Allium Labs, suggests that over 90% of stablecoin transaction volumes may not be coming from genuine users.

Venture capitalists have poured over $1 billion into the cryptocurrency and blockchain industry for the second month this year in April, with $1.02 billion being invested across 161 funding rounds – a slight dip from the $1.09 billion invested in 186 rounds in March.

Alexander Vinnik, a former operator of the now-defunct BTC-e cryptocurrency exchange, pleaded guilty to a charge of conspiring to commit money laundering, the U.S. Department of Justice announced.

Top stories in the Crypto Roundup today:

• 90% of Stablecoin Transactions Linked to Bots, Not Real Users
• Venture Capitalists Pour Over $1 billion in the Crypto Space for Second Month in a Row
• Former BTC-e Exchange Operator Pleads Guilty to Money Laundering
• Spread is Significantly Varied Across Benchmarked Exchanges

90% of Stablecoin Transactions Linked to Bots, Not Real Users

A new study by Visa, conducted in collaboration with Allium Labs, suggests that over 90% of stablecoin transaction volumes may not be coming from genuine users.

Visa and Allium Labs developed a new metric that aims to isolate "organic payments activity" by filtering out transactions initiated by bots and large-scale traders. This revealed that out of a reported $2.2 trillion in total stablecoin transactions for April, only $149 billion originated from actual users’ organic payments activity.

Pranav Sood, executive general manager for EMEA at payments platform Airwallex, commented that the data suggests stablecoins are at a “very nascent moment in their evolution as a payment instrument” and added that this doesn’t mean they don’t have long-term potential, but rather that their short-term and mid-term focus “needs to be on making sure that existing rails work much better.”

Double-counting transactions further complicates the picture for stablecoins. As explained by Cuy Sheffield, Visa's head of crypto, transferring funds between different stablecoin variants can inflate overall volume as, for instance, converting USDC to PYUSD on decentralized exchange Uniswap could register as $200 in total stablecoin activity, even though the underlying value remains $100.

Visa itself, having processed over $12 trillion in transactions last year, stands to lose ground if stablecoins become mainstream. Analysts at Bernstein predicted that the total value of all stablecoins could reach $2.8 trillion by 2028, an 18-fold increase from their current circulating value, with the allure behind these tokens being their potential for instant and near-costless transactions.

Venture Capitalists Pour Over $1 billion in the Crypto Space for Second Month in a Row

Venture capitalists have poured over $1 billion into the cryptocurrency and blockchain industry for the second month this year in April, with $1.02 billion being invested across 161 funding rounds – a slight dip from the $1.09 billion invested in 186 rounds in March.

According to data from RootData, this was the first time since late 2022 that cryptocurrency venture funding exceeded the $1 billion mark for two consecutive months.

Several high-profile investments fueled this trend, with BlackRock leading a $47 million injection into Securitize, a firm focused on tokenizing real-world assets and Monad, a layer-1 blockchain aiming to rival Solana, securing a massive $225 million investment from Paradigm and Coinbase Ventures.

Blockchain infrastructure projects saw the most capital flowing in at $1.7 billion, with Auradine and Berachain receiving $80 million and $100 million, respectively. Decentralized finance protocols came in second with $626 million, while Decentralized Autonomous Organizations (DAOs) have seen minimal investment, receiving only $3 million.

With over $3.67 billion invested across 604 funding rounds this year, the industry is on track to surpass the $9.3 billion raised in 2023.

Former BTC-e Exchange Operator Pleads Guilty to Money Laundering

Alexander Vinnik, a former operator of the now-defunct BTC-e cryptocurrency exchange, pleaded guilty to a charge of conspiring to commit money laundering, the U.S. Department of Justice announced.

According to the DOJ, Vinnik played a key role in BTC-e's operations from 2011 to 2017, with the exchange having processed transactions of over $9 billion in cryptocurrency from more than 1 million users worldwide.

BTC-e came under scrutiny for its alleged involvement in laundering 300,000 BTC stolen from  collapsed cryptocurrency exchange Mt. Gox. BTC-e was shut down in July 2017, at the same time Vinnik was arrested in Greece and started facing a lengthy extradition process.

Vinnik's extradition process involved the United States, Russia, and France all vying for his custody. Ultimately, France secured his extradition and sentenced him to prison before sending him back to Greece, from which he was then extradited to the U.S. to face charges.

The DOJ alleges that BTC-e operated without registering as a money services business in the U.S., without any know-your customer or anti-money laundering checks, and without collecting customer data, all while using shell companies to facilitate the conversion of fiat currency conversions.

The DOJ’s claims add that the exchange received funds derived from criminal activities, including ransomware attacks, hacking schemes, and other illicit sources. Vinnik himself is reportedly held responsible for laundering at least $121 million in stolen funds.

Spread is Significantly Varied Across Benchmarked Exchanges

Spread is a key measure for evaluating the quality of a market and maintaining equitable trading conditions. From our detailed order book data, we observed that Gemini and BitMEX had the widest spreads on their BTC Spot pairs within our sample, with spreads peaking at 0.372% and 0.476%, respectively.

In contrast, Binance and OKX exhibited the narrowest spreads, reaching only 0.0007% and 0.0011%, respectively.

Dig depper via CCData’s latest Exchange Benchmark report.

State of the Crypto by Top Tier Exchange Volume

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