Appold Market Watch - Week ending 10 January 2025
Market Update & Industry News - Week ending 10 January 2025
🔷 Multinational bank, Standard Chartered, established a new entity in Luxembourg to provide digital asset custody services within the European Union. The bank aims to capitalise on the increasing demand for digital security among institutional investors.
Appold view: This is an expansion from what they launched in the Middle East in September 2024. Standard Chartered’s continual expansion into this space could set the scene for the future absorption of their Zodia Custody investment under the Standard Chartered brand, which could further attract some very sizeable and high-profile institutional clients. This is just speculation, but it would make strategic sense.
🔷 The UK Treasury amended the Financial Services and Markets Act 2000 to clarify that digital asset staking does not constitute a collective investment scheme (CIS). This distinction exempts proof-of-stake blockchains from the stringent regulations applied to CIS. The updated law, effective from 31 January 2025, defines “qualifying crypto asset staking” as the process of validating transactions on a blockchain or similar technology.
Appold view: This reinforces that staking is a critical component of blockchain infrastructures, not a speculative investment scheme. From an institutional perspective, financial service providers, including banks and custodians, should now be able to offer staking services as part of their digital asset strategies without falling under investment fund regulations.
🔷 A Texas Court ordered a Bitcoin investor to surrender access to $124 million in digital assets. The early adopter of Bitcoin was found guilty of fraud and was mandated to provide the courts with private keys, access codes and cold storage devices to pay $1.1m restitution to the US Government. The investor faced previous charges in 2023 for allegedly misreporting capital gains in Bitcoin transactions.
Appold view: This ruling highlights that owning digital assets is not beyond the reach of the law, challenging the perception of absolute crypto privacy. As authorities tighten enforcement on crypto tax evasion and fraud, custodians and investors must be prepared to comply with legal orders for asset recovery.
🔷 The US Government secured approval in a Californian District Court to liquidate 69,370 Bitcoin seized from the illegal dark web marketplace Silk Road. It is alleged that more administrative steps and appeal windows are involved in selling the largest digital asset federal seizure in history.
Appold view: This is notable as the largest federal seizure in history and highlights the government's ability to track and recover stolen assets, using market specialists. The Bitcoin was worth $600,000 at the time in 2012. The Bitcoin value has now grown to $6.5 billion
#Marketwatch #Blockchain #Investments
