- Crypto and traditional markets stabilized this morning after their sell off from a hotter-than-expected CPI print yesterday. At the time of writing, $BTC is up 0.03%, and $ETH is up 0.91%, while SPX and NDQ have risen 0.48% and 0.88%. ETH/BTC, which saw some unwinding early this week, is recovering and up 5.34% from its low yesterday. The long-awaited Ethereum Merge is nearly here and is set to happen around 1:00 am ET tomorrow. A Merge countdown can be found here. Ethereum's funding rates continue to get progressively more negative leading into the merge - caused partly by traders doing the ETH Proof of Work airdrop trade (buy spot ETH and short ETH futures in order to collect the ETH POW airdrop without ETH price exposure). The negative funding is also due to ETH holders concerned about the technical risks of the merge hedging their exposure. If the merge is a success, many of these hedges will likely close, potentially leading to price squeezing higher. Interestingly, liquid staking providers $LDO and $RPL are struggling today - down 8.77% and 2.62%, respectively.
- One of the largest investment management companies in the world, KKR, is set to tokenize its Health Care Strategic Growth Fund II (HCSG II) on the Avalanche Blockchain. KKR will tokenize this fund with the help of digital asset management company Securitize Capital. The tokenization will enable investors to own a token representing a share of the $4 billion healthcare-focused fund that invests in 23 North American and European companies in the pharmaceuticals, medical devices, and life sciences sectors. To buy and own the token, investors must submit their passports, fill out personal and tax information, and complete a "liveliness check" to be reviewed. Investors will also be subject to a 0.50% management fee.
- Crypto custody firm, Bitgo, has sued Galaxy Digital, seeking more than $100 million in damages for allegedly breaching its $1.2 billion merger. The merger was announced in May of 2021 and was expected to close in the fourth quarter of 2021. In August of 2022, Galaxy Digital terminated the agreement, claiming that BitGo had failed to deliver audited financial statements for 2021. BitGo refuted Galaxy's claims, and Quinn Emanuel, BitGo's litigation partner, went on to say, "It is public knowledge that Galaxy reported a $550 million loss this past quarter, that its stock is performing poorly, and that both Galaxy and Mr. Novogratz have been distracted by the Luna fiasco. Either Galaxy owes BitGo a $100 million termination fee as promised, or it has been acting in bad faith and faces damages of that much or more."
Crypto Daily Report – September 14
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