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Coinbase-backed crypto trading firm hits $1 billion valuation after fresh funding round

Amber Group, a cryptocurrency financial services firm, has raised $100 million as investors rush to back companies in the industry.

The fresh funding round values the Hong Kong-based start-up at $1 billion.

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Amber Group, a cryptocurrency financial services firm, has raised $100 million as investors rush to back companies in the industry.

The fresh funding round values the Hong Kong-based start-up at $1 billion.

Investment bank China Renaissance led the round with participation from other high-profile investors including New York-based Tiger Global Management. Existing investors, which includes Coinbase’s venture arm, were involved.

The latest funding round continues a flurry of funding activity in the cryptocurrency industry.

In the second quarter of 2021, venture capital investment into cryptocurrency and blockchain start-ups totaled $14 billion, according to data from PitchBook provided to CNBC. That compares to just $600 million in the same period last year.

Interest in cryptocurrencies, particularly in bitcoin, rose this year as institutional investors and large corporations jumped in. Payments processor Square and electric vehicle maker Tesla are among the companies that have purchased bitcoin.

But after touching a record high of $64,829.14 in April, bitcoin has plunged by nearly half.

Business model
Amber Group has typically sold products to institutional investors and wealthy individuals including algorithmic trading and lending products.

Rather than being a cryptocurrency exchange that allows users to trade individual digital coins, Amber Group CEO Michael Wu said the company is bringing a “private banking experience to every day customer.”

Wu says the company offers investors a number of different cryptocurrency products to invest in.

Amber Group said it is on track to book revenue of $500 million by the end of this year and has been profitable “since inception.”

According to Wu, between 70% and 80% of the company’s revenue comes from so-called net interest margin — a measure of lending profitability. Amber Group takes on customers’ deposits and offers them an interest rate. They then lend out the money from a pool of deposits to other entities at higher interest rates and make money from that spread.

About 15% of revenue comes from trading fees.

While the majority of the company’s customers are institutional investors, Wu said Amber Group is making a push to gain individual investor customers.

“We don’t advocate heavy speculation or high use of leverage, rather we want our customers to be more long term, focus on risk management and get stable and attractive yield,” Wu said.

Strategic acquisitions
The CEO said the fresh capital raised will be used to “hire even more aggressively” and to make strategic acquisitions in areas such as cybersecurity.

But Wu said the company is also looking to acquire others that have regulatory licenses in certain jurisdictions, which could allow Amber Group to enter a new market.

Regulation around cryptocurrency investing differs around the world and is quite fragmented.

“I think regulation is always a challenge for this industry because it’s a very global industry,” Wu said. “It’s always about staying ahead, or at least staying aware of the different regulation. We always take a very conservative approach to that.”

Source Credits: CNBC

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GameStop hints at future Bitcoin purchases following board approval

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GameStop is exploring the possibility of adding Bitcoin to its balance sheet, but any future purchases will require approval from the company’s board of directors. The move signals the gaming retailer’s continued interest in digital assets as it seeks to diversify its financial strategy.

The potential Bitcoin investment aligns with GameStop’s previous forays into the crypto space, including its NFT marketplace and blockchain gaming initiatives. However, the company has not yet committed to a specific timeline or amount for Bitcoin purchases.

Industry analysts suggest that if GameStop proceeds with Bitcoin acquisitions, it could follow in the footsteps of other publicly traded companies, such as MicroStrategy, that have adopted Bitcoin as a reserve asset. The decision could also serve as a signal to retail and institutional investors about GameStop’s long-term outlook on digital assets.

As the company awaits board approval, the broader market will be watching closely to see if GameStop makes a decisive move into Bitcoin, potentially influencing other corporations to consider similar strategies.

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SEC nominee Atkins discloses at least $327M in assets ahead of confirmation hearing

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Paul Atkins, a former commissioner of the U.S. Securities and Exchange Commission (SEC), is under scrutiny over financial disclosures related to his wife. The concerns emerged during a recent hearing, raising questions about transparency and potential conflicts of interest.

Atkins, who served at the SEC from 2002 to 2008, has been a vocal advocate for regulatory clarity in financial markets, including the cryptocurrency sector. However, lawmakers and regulators are now examining whether proper disclosures were made regarding financial assets linked to his wife.

The inquiry reflects broader concerns about ethics and accountability among financial regulators and policymakers. While Atkins has not been formally accused of wrongdoing, the situation highlights ongoing debates over financial transparency in government and regulatory agencies.

As the hearing unfolds, industry observers are closely watching for potential implications on SEC policies and oversight practices. The outcome could influence future regulatory discussions, particularly in areas where financial disclosures intersect with policymaking in traditional and digital asset markets.

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Brazil’s data watchdog upholds ban on World crypto payments

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Brazil’s data protection authority is ramping up its oversight of cryptocurrency payment platforms, reflecting growing concerns over data privacy and regulatory compliance in the digital asset sector. The move aligns with a broader global trend of increased scrutiny on crypto transactions.

The regulatory focus comes as crypto payments gain mainstream adoption in Brazil, with businesses and consumers increasingly using digital assets for everyday transactions. Authorities aim to ensure that companies handling crypto payments comply with data protection laws, safeguarding user information against misuse and security breaches.

This initiative follows global regulatory efforts to address concerns over illicit financial activities and privacy risks associated with digital currencies. While Brazil has been a leader in Latin America’s crypto adoption, regulators are working to balance innovation with consumer protection.

Industry experts believe that stricter oversight could enhance trust in the crypto sector, attracting institutional players while ensuring compliance with international standards. As regulations evolve, businesses operating in the crypto payments space will need to adapt to the changing legal landscape to maintain seamless operations.

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