Mark Travoy

DCG Files Complaint Against Genesis Over $1.1 Billion Promissory Note

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Venture capital firm Digital Currency Group (DCG) has launched fresh legal action against two of its subsidiaries, intensifying the ongoing fallout from the collapse of Three Arrows Capital (3AC).

In a filing to the US Bankruptcy Court for the Southern District of New York, DCG alleged that Genesis Global Capital and Genesis Asia Pacific profited unfairly from a $1.1 billion promissory note tied to the 2022 default of 3AC.

The complaint argues that instead of suffering losses, the Genesis entities received “hundreds of millions of dollars” in gains, creating an obligation to return overpayments to their parent company.

Background to the Promissory Note

DCG issued the 10-year note in June 2022 to cover a potential equity shortfall in Genesis Asia Pacific following 3AC’s failure to meet obligations.

At the time, concerns loomed that the collapse of 3AC — one of Genesis’ largest borrowers — would trigger significant liquidity issues.

However, according to DCG, cryptocurrency markets later rebounded, increasing the value of collateral held against the loans.

That included shares in Grayscale’s Bitcoin Trust, which surged alongside Bitcoin’s recovery.

DCG claimed Genesis not only avoided financial damage but ultimately profited from 3AC’s collapse.

“[T]he incremental amounts realized by Genesis after issuance of the Note were … far more than sufficient to overcome the prior $1.1 billion collateral shortfall — and, on information and belief, allowed Genesis to profit from [3AC]’s default by recovering nearly $2.8 billion on the original $2.36 billion in [3AC] Loans,” the filing said.

Genesis Pushes Back

Genesis, however, has rejected the latest complaint, accusing DCG of attempting to rewrite history.

“DCG’s unfounded, haphazard and convenient about-face to withhold 3AC distributions is meritless,” said Luke Barefoot, partner at Cleary Gottlieb and counsel to Genesis.

“It flatly contradicts the written agreements, DCG’s representations to the bankruptcy court, and the fact that DCG already handed over $100M+ in distributions.”

This legal clash follows earlier suits filed by Genesis against DCG, its affiliates, and CEO Barry Silbert.

In May, Genesis sought $3.3 billion in damages, accusing its parent company of fraudulent transfers and insider enrichment in the lead-up to bankruptcy.

The Wider Market Context

The 3AC default was one of several shocks that rattled crypto markets in 2022.

The collapse of the Terra ecosystem triggered a cascade of failures, leaving investors with heavy losses and exposing vulnerabilities across the industry.

That same year, FTX — once one of the largest exchanges — imploded in spectacular fashion, with executives later indicted for fraud.

DCG’s filing referenced the wider turmoil, noting that even without 3AC’s collapse, Genesis would have struggled to survive.

“Even had [3AC] not defaulted in June 2022, [Genesis Global Capital] would not have had sufficient capital to withstand the unexpected and devastating market rout that followed the collapse of FTX in November 2022,” the filing stated.

Genesis halted withdrawals that month before officially declaring bankruptcy on January 19, 2023.

Restructuring and Recovery

After months of proceedings, Genesis completed its restructuring in August 2024.

The plan involved distributing approximately $4 billion to creditors and other affected parties.

While this was seen as a significant step toward closing one of the darkest chapters in crypto lending, disputes between Genesis and DCG remain unresolved.

DCG is now seeking more than $105 million plus interest from its subsidiaries, arguing the terms of the promissory note require repayment given the profits made from 3AC’s collateral.

Ongoing Legal Battle

The latest filing highlights the complex financial web left by crypto’s 2022 crash, with companies still grappling over responsibility for billions lost and gained.

For DCG and Genesis, the courtroom has become the battleground for settling questions of accountability.

The outcome of this case could have major implications, not just for the firms involved but also for creditors seeking clarity on how recoveries from failed borrowers are handled.

With tensions high, the dispute underscores how the ripple effects of 3AC’s collapse and the wider market downturn continue to haunt the sector.

Coinbase Finalizes $2.9 Billion Deribit Acquisition in Global Expansion Push

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Coinbase has completed its acquisition of Deribit, the world’s largest crypto options trading platform by volume, marking another significant step in the company’s efforts to broaden its global presence.

The $2.9 billion deal, first announced in May, officially closed this week.

Deribit recorded over $1 trillion in trading volume in 2024, drawing a dedicated base of institutional and sophisticated traders.

Coinbase said the platform’s strong client loyalty and market leadership made it a strategic addition to its expanding suite of services.

Building a One-Stop Crypto Hub

Coinbase has been steadily growing its offerings to serve diverse segments within the crypto sector.

The exchange now provides a perpetual futures platform, prime brokerage services, retail spot trading, institutional lending, and secure asset custody.

By integrating Deribit’s operations, Coinbase aims to bolster its derivatives capabilities while reinforcing its ambition to become a one-stop destination for digital asset services.

Despite the milestone, Coinbase’s stock slipped by roughly 2.5% in intraday trading following the deal’s closure.

This minor dip follows a broader pattern of market adjustments after major acquisitions.

Six Acquisitions in 2025

The Deribit purchase is one of six acquisitions made by Coinbase so far in 2025.

In January, the exchange acquired Spindle, a blockchain-based advertising platform designed to help creators boost their visibility online.

The same month, Coinbase brought on the team behind Roam, a blockchain-based web browser project.

In July, it added Liquifi, a platform focused on supporting early-stage token startups with management tools and resources.

These deals reflect Coinbase’s strategy of expanding into complementary areas of blockchain and crypto infrastructure.

Industry-Wide Expansion Trends

Coinbase’s aggressive growth mirrors a wider trend among major crypto exchanges branching into adjacent markets.

Kraken, for instance, launched tokenized stock trading for non-US residents in May, tapping into the emerging tokenized securities space.

The company also offers crypto futures, staking, asset custody, and over-the-counter services for institutions.

Robinhood has been blurring the line between traditional and digital finance by providing mixed-asset trading and announcing a layer-2 blockchain for tokenized stock trading in Europe.

Meanwhile, Binance continues to diversify its portfolio with retail and institutional offerings, including options, futures, and token launch platforms.

Since 2018, Binance has been actively acquiring crypto wallets, blockchain development teams, exchanges, and analytics firms.

Coinbase’s move for Deribit underscores the competitive race among major exchanges to expand capabilities and secure market share in the evolving global crypto economy.

Standard Chartered Lifts 2025 Price Forecast to $7,500 Despite Selling Pressure

Standard Chartered has sharply increased its Ether price target for 2025 to $7,500, up from a previous $4,000, citing rising institutional demand and regulatory clarity on stablecoins.

The bank’s report highlighted that Ether ETFs and corporate treasuries have bought 3.8% of all ETH in circulation since early June.

This pace is nearly double Bitcoin’s fastest rate of institutional accumulation during the 2024 US election period.

Catalysts for Growth

The bank said two major developments have boosted sentiment: strong industry engagement from the Ethereum Foundation and Etherialize, and Ethereum co-founder Vitalik Buterin’s plans to increase layer-1 throughput tenfold.

This would allow more high-value transactions to settle on the main chain while smaller ones move to layer-2 networks such as Arbitrum and Base.

Another driver is the GENIUS Act, passed in July, which sets a legal framework for stablecoins.

Stablecoins now account for 40% of blockchain fees, with over half issued on Ethereum.

Standard Chartered expects the stablecoin market to grow from its current size to $2 trillion by 2028, significantly increasing Ethereum’s usage.

Market Outlook

The bank forecasts Ether will break its previous all-time high in Q3 2025 and outperform Bitcoin, with the ETH-BTC ratio rising from 0.036 to 0.05.

Its long-term projections put ETH at $12,000 in 2026, $18,000 in 2027, and $25,000 by 2028.

At present, ETH trades at $4,692 — just below its 2021 record of $4,891.

Short-Term Market Moves

With Ether close to its all-time high, some large holders are taking profits.

The “7 Siblings” Ethereum whale group recently sold $88.2 million worth of ETH, unloading 19,461 coins at an average of $4,532.

Despite this selling pressure, Standard Chartered expects long-term demand drivers to outweigh short-term volatility.

Ethereum Traders Lock in Gains as Price Hovers Near $4,300, But New Rally in Doubt

Ethereum’s recent rally has prompted a wave of profit-taking among short-term holders, as the cryptocurrency continues to hover around the $4,300 mark.

On-chain analytics firm Glassnode reported that traders holding Ether for less than 155 days have been cashing out at a faster pace than long-term investors.

The firm’s data shows that the seven-day simple moving average of realized profits is approximately $553 million per day, with the majority of those gains coming from short-term holders.

“Short-term investors are realizing far more gains, driving the current wave,” Glassnode noted in a post on X.

Long-Term Holders Remain Steady

While short-term traders appear eager to lock in profits, Glassnode found that long-term holders are taking gains at levels comparable to December 2024.

This suggests that seasoned investors are not rushing to exit their positions, despite the recent surge.

Profit realization across the market remains roughly 39% lower than the peak levels recorded last month, when Ether traded near $3,500.

Price Performance and Market Sentiment

Ether has gained 43% over the past month, currently trading around $4,283 according to Nansen.

However, it still sits about 12.7% below its all-time high of $4,828, reached in November 2021.

Some traders remain cautious about a near-term push toward those highs.

Data from CoinGlass indicates that approximately $2.23 billion in positions could face liquidation if the price approaches $4,700.

The hesitancy stems in part from earlier struggles this year, when Ether dipped below $2,000 in March and several rally attempts faltered before the latest climb.

High-Profile Moves and Key Levels

On Saturday, BitMEX co-founder Arthur Hayes revealed he had bought back into Ether, just a week after selling $10.5 million worth when the token traded at $3,507.

Since Sunday, Ether has crossed above $4,300 multiple times, only to fall back below.

This level has become a focal point for traders watching for signs of a sustained breakout.

Institutional Interest and FOMO Risks

Institutional activity in Ethereum has been growing, with companies holding a combined 3.04 million ETH in their treasuries — worth about $13 billion.

Still, some analysts warn that public announcements of large institutional purchases can spark short-term volatility.

Santiment analyst Brian Quinlivan said that such news “can trigger FOMO that may briefly stall or even push Ether’s price down.”

The coming weeks will reveal whether Ethereum can maintain momentum or if profit-taking pressure will drive a pullback.

Crypto Investment Products See $572M Inflows After Market Recovery

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Cryptocurrency investment products attracted $572 million in inflows last week, rebounding after the prior week saw the end of a record-breaking 15-week inflow streak totaling $27.8 billion.

The data, published by European crypto asset manager CoinShares on Monday, shows that global crypto exchange-traded products (ETPs) benefited from a market recovery that pushed both Bitcoin and Ether prices higher.

Ether crossed the $4,000 mark for the first time since December 2024, while Bitcoin climbed back above $120,000.

Year-to-Date Flows Hit All-Time High

With last week’s inflows, total year-to-date (YTD) investment into crypto ETPs reached a record $30.7 billion.

Assets under management (AUM) also hit a historic peak of $226 billion.

These figures reflect renewed investor optimism following a volatile start to August.

401(k) Policy Shift Boosts Sentiment

James Butterfill, CoinShares’ head of research, attributed much of the week’s late inflows to a major policy announcement in the United States.

“In the latter half of the week, however, we saw $1.57 billion of inflows, likely spurred by the government’s announcement permitting digital assets in 401(k) retirement plans,” Butterfill said.

Earlier in the week, however, the market saw $1 billion in outflows, which he linked to concerns about slowing economic growth after weak U.S. payroll data.

Ether ETPs Lead the Market

Ether-based ETPs continued to outperform, bringing in nearly $270 million in inflows last week.

“This pushed year-to-date inflows to a new record of $8.2 billion, while recent price gains have driven total assets under management to an all-time high of $32.6 billion, up 82% so far this year,” Butterfill said.

The surge follows strong July performance, during which ETH-based products also led the market.

Bitcoin ETPs Recover After Outflows

Bitcoin ETPs saw $265 million in inflows, ending a two-week streak of outflows.

This recovery suggests that investors are regaining confidence in BTC’s near-term trajectory, particularly as institutional adoption deepens.

Altcoins Attract Investor Interest

ETPs tracking Solana (SOL), XRP, and Near Protocol (NEAR) also saw meaningful inflows.

Solana products brought in $21.6 million, XRP attracted $18.4 million, and NEAR saw $10.1 million in new investments.

BlackRock Approaches $100B in Crypto AUM

Among issuers, BlackRock’s iShares crypto ETFs led the way with $294 million in inflows.

While that’s down 61% from the prior week’s $749 million, the funds are now close to the $100 billion AUM milestone, ending Friday at $98.9 billion.

Grayscale Investments, the second-largest issuer with $35.4 billion in AUM, recorded $87 million in inflows.

Bitwise posted $95 million, while Fidelity Investments experienced the largest issuer-level outflows, losing $55 million.

Market Outlook

The return of inflows across multiple asset categories signals improving sentiment ahead of key macroeconomic events this quarter.

With U.S. policy shifts favoring broader crypto integration into retirement accounts, analysts expect ETP inflows to remain strong in the near term.

Bitcoin Nears $119K Before Weekly Close as Almost $20bn of Liquidations Come Into Target

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Bitcoin (BTC) approached $119,000 ahead of a key weekly close, sparking expectations of a strong start to the week among traders.

Weekend trading saw BTC/USD hit $118,760 on Bitstamp, setting new August highs.

Data from CoinGlass showed $350 million in crypto liquidations over 24 hours.

Support Levels and Resistance Targets

Analyst Rekt Capital noted that BTC is close to reclaiming $117,200 as a support level.

Popular trader BitBull said a 10% move higher could trigger $18 billion in short liquidations, potentially pushing BTC above $120,000.

He predicted a brief pullback early in the week before another push higher.

CME Gap Considerations

Investor Ted Pillows pointed out a CME gap around $116,500, suggesting BTC might dip to fill it before rallying to a new all-time high.

Daan Crypto Trades described weekend price action as “choppy” and expects BTC to take the spotlight if it breaks $120,000.

XRP Surges Over 10% Following Ripple–SEC Truce, Broader Market Rally

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XRP has jumped more than 10% since Thursday, trading at $3.29 after Ripple and the U.S. Securities and Exchange Commission (SEC) agreed to dismiss their respective legal appeals.

The move brings an end to a multi-year legal battle that has weighed heavily on XRP’s market performance.

Market analysts say the resolution has reignited interest among traders and investors.

XRP Futures Activity Surpasses Solana

In the past 24 hours, XRP futures trading volume surged more than 200% to $12.4 billion, surpassing Solana’s $9.6 billion, according to on-chain data from Glassnode.

A sharp rise in futures volume is often linked to heightened speculative trading, particularly after significant news developments.

XRP open interest, reflecting the value of unsettled futures contracts, also increased 15% to around $5 billion.

Glassnode data showed XRP’s daily funding rate at 0.01%, indicating a tilt toward long positions as traders bet on continued price gains.

However, the analytics firm warned that heavy long positioning can magnify downside risks, with overleveraged traders vulnerable to forced liquidations if prices turn lower.

Key Support Levels Identified

Cost basis distribution data highlights the $2.80–$2.82 price range as a critical area of support.

More than 1.70 billion XRP tokens were acquired within this band, suggesting many holders are likely to defend their positions if prices decline.

Market watchers note that such concentrated buying zones can provide strong price floors.

Technical Patterns Point to 35% Upside

XRP’s recent price rally pushed it above the upper trendline of a bull flag formation.

Trading volumes have risen in tandem, supporting the breakout momentum.

Based on traditional chart analysis, the pattern suggests a potential move to over $4.50 — a gain of roughly 35% from current levels — by September or October.

Expectations of a Federal Reserve rate cut in September could further fuel appetite for risk assets, including cryptocurrencies.

Multiple analysts have issued bullish forecasts.

Mikybull Crypto has predicted XRP could climb to between $5 and $8 by the end of 2025, while another analyst, Dom, has projected a price of $10.

XRP Surges Above $3 With 4.5% Rally Amid Hopes of SEC Case Resolution

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XRP surged past the $3 mark for the first time in over a week, driven by mounting optimism that the U.S. Securities and Exchange Commission (SEC) may soon dismiss its appeal against Ripple Labs.

The token climbed over 4.5% in 24 hours to hit $3.04 on Thursday, according to data from Cointelegraph.

The rebound came amid growing speculation that a resolution to the years-long legal battle between the SEC and Ripple is approaching.

Bill Morgan Predicts Appeal Dismissal

Investor sentiment was further bolstered by legal commentary from Bill Morgan, an attorney closely following the case.

Posting on X, Morgan suggested that the SEC is likely to drop its appeal before the August 15 deadline set by the U.S. Court of Appeals for the Second Circuit.

“Dismissal of the appeals may happen, and is more likely to happen than not, before the 15 August deadline to report to the appeal court on the status of the appeals,” he said.

Morgan pointed out that Ripple had already agreed to dismiss its own appeal and that both sides had previously signed a conditional settlement agreement.

Although the terms of that agreement were not satisfied at the time, the groundwork remains for a conclusion if court conditions are met.

While the parties could request an extension from the court, Morgan believes this is unlikely.

Legal Milestone Could End Years-Long Battle

The upcoming joint report from Ripple and the SEC to the Second Circuit could mark a critical turning point.

If the appeal is dismissed and the court grants approval, the case may be finalized and returned to the district court for formal settlement authorization.

That would effectively bring an end to one of the longest-running legal battles in crypto history.

SEC vs Ripple: A Pivotal Case in Crypto Regulation

The SEC originally filed its lawsuit against Ripple in December 2020, accusing the company of raising $1.3 billion through unregistered securities sales via XRP.

The case has since become a central issue in debates over crypto regulation.

In July 2023, Judge Analisa Torres ruled that XRP does not constitute a security when sold to retail investors, though it is a security in institutional sales.

That ruling marked a partial win for Ripple but also resulted in a $125 million fine levied in August 2024.

Settlement Efforts Underway

Efforts to resolve the dispute have continued.

On June 12, Ripple and the SEC filed a joint motion to release the $125 million held in escrow for settlement purposes.

The proposed split would allocate $50 million to the SEC and return $75 million to Ripple, pending court approval.

If accepted, the payment would likely close the case—ending nearly five years of legal friction that has weighed heavily on XRP’s price and investor confidence.

Broader Market Implications

The outcome of this case could have far-reaching consequences beyond Ripple.

Many in the crypto industry view it as a precedent-setting event that could clarify how digital assets are regulated in the United States.

A favorable resolution for Ripple may also encourage other crypto firms to challenge the SEC’s regulatory stance.

Bears Fired Warning as OTC Desks Run Low, Set Up Huge Price Shock

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Bitcoin’s price may be on the verge of a major breakout as dwindling reserves on both exchanges and over-the-counter (OTC) desks create an imbalance between supply and demand.

Swing trader Bedlam Capital Pres has forecast a “supply shock” that could “uncork” Bitcoin’s next major rally.

OTC Balances Near Critical Lows

Bedlam Capital Pres, a strong advocate for Bitcoin treasury company Strategy (MSTR), pointed to rapid declines in OTC desk BTC holdings as a key driver of potential price gains.

“$MSTR buys most of its BTC from OTC trade desks. MSTR bought 182,391 BTC YTD,” the trader said, referencing a Cointelegraph report.

“OTC trade desks’ collective balances are down to around 155,000 BTC. As the OTC desks run low, the demand on the public exchanges will increase, and that is what will uncork BTC’s price.”

The analysis comes as corporate Bitcoin holdings continue to climb.

On Monday alone, treasuries added 630 BTC despite Bitcoin trading near three-week lows.

Strategy, the largest public company holder of Bitcoin, has been acquiring the asset almost every week this year regardless of market price.

Exchange Reserves Bottoming Out

Glassnode data shows combined exchange balances stood at 2.919 million BTC as of Tuesday, marking a significant reduction in available supply.

This trend has coincided with long-term holders taking profits during recent price dips.

“In sum, the market has shifted from euphoria to reassessment, with oversold conditions and seller exhaustion hinting at potential for a bounce,” Glassnode noted in its Market Pulse newsletter.

“However, fragility is growing, and the structure remains vulnerable to external negative catalysts or delayed demand revival.”

Profit-Taking Still Evident

Market participants remain wary of further corrections.

Glassnode calculated over $1 billion in realized profits over a 24-hour period this week.

“$362M (≈35.8%) came from ancient coins held for 7–10 years – a rare event that may reflect internal transfers or true exits,” the firm explained.

“Another $93M came from 1–2 year holders, also marking notable profit realization.”

With OTC liquidity thinning and exchange reserves nearing multi-year lows, analysts argue that even modest demand growth could drive substantial price appreciation in the coming months.

Ether ETFs See Record Circa $500 Million Daily Outflow as Market Sentiment Shifts

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United States spot Ether exchange-traded funds (ETFs) experienced their steepest single-day net outflows on Monday, shedding nearly half a billion dollars.

According to investment firm Farside Investors, Ether ETFs posted $465 million in outflows, surpassing all previous daily records since the funds were introduced.

The mass withdrawal followed an earlier outflow of $152 million on Friday, which ended a strong 20-day streak of consistent inflows.

Investor Caution Following July Surge

The sudden reversal in flows may indicate a broader shift in investor sentiment after a particularly bullish July.

Last month, spot Ether ETFs attracted a record $5.43 billion in net inflows.

However, the pullback came as Ether prices dropped significantly, falling 12% from $3,858 on Thursday to $3,380 on Sunday.

By Tuesday, the token had recovered to $3,629, based on CoinGecko data.

BlackRock’s ETHA Takes the Hardest Hit

Among individual funds, BlackRock’s iShares Ethereum Trust (ETHA) bore the brunt of the outflows.

The fund alone lost nearly $375 million in net assets on Monday.

Despite the setback, ETHA retains a cumulative net inflow of $9.3 billion and total assets of $10.7 billion.

Fidelity’s Ethereum Fund (FETH) also experienced notable outflows, recording $55.11 million in net withdrawals for the day.

FETH currently holds $2.4 billion in assets and has a total net inflow of $2.2 billion since launch.

Grayscale Products Also See Withdrawals

Grayscale’s Ether-focused products were not spared.

The Grayscale Ethereum Mini Trust saw a net outflow of $28 million, while the Grayscale Ethereum Trust (ETHE) recorded $6.9 million in outflows.

Grayscale’s ETHE fund, which has been under pressure for months, now has a cumulative net outflow of $4.3 billion and net assets of $4.1 billion.

Meanwhile, the Ethereum Mini Trust maintains $2.3 billion in assets and a $1.1 billion net inflow.

Institutional Demand Remains Resilient

Despite ETF withdrawals, blockchain activity indicates continued institutional interest in ETH.

On Tuesday, blockchain analytics platform Lookonchain reported that three wallets—believed to be controlled by institutional players or whales—acquired a total of 63,837 ETH, valued at approximately $236 million.

These purchases were reportedly made through over-the-counter transactions facilitated by FalconX and Galaxy Digital.

Since July 9, Lookonchain has identified 14 new wallets collectively accumulating over 856,000 ETH—worth more than $3.1 billion.

Market Watching for Trend Reversal

The divergence between ETF flows and institutional activity highlights a mixed outlook for Ether in the near term.

Retail-driven ETF outflows suggest caution, while large-scale OTC purchases signal that sophisticated investors may be positioning for a longer-term play.

How the market interprets these conflicting signals could influence Ether’s price trajectory and ETF sentiment heading into the final months of the year.

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