Blockchain firm BTCS soars on retail rush for Bitcoin dividends
Shares in BTCS rocketed as more retail investors scooped them up after the company offered to pay dividends in Bitcoin.
Shares in blockchain technology-focused firm BTCS Inc rocketed on Thursday, set to extend a four-day rally, as more retail investors scooped them up after the company last week offered to pay dividends in Bitcoin. The Silver Spring, Maryland-based company has seen its stock value more than double since Jan. 5, when it proposed to pay $0.05 per share in bitcoin to those who opt for it. Its first bitcoin dividend, or "bividend" as BTCS calls it, is due on March 16.
Shares of BTCS climbed 20% to a six-week high of $7.80 in early trading on Thursday as the online buzz over its plan grew in forums such as Reddit and stocktwits.com, which were instrumental in the "meme stock" frenzy last year.
Nearly 9 million BTCS shares changed hands within the first few minutes of trading, more than double the company's public float of 4.2 million shares. A smaller number of free float shares makes the stock vulnerable to sharp moves.
"This is a moment we have long anticipated since the Company purchased the domain, bividend.com, in February 2015," CEO Charles Allen said in a statement last Wednesday.
BTCS, last valued at $69 million, claims to be the first Nasdaq-listed firm to offer dividends in bitcoin. Video game retailer GameStop on Friday jumped as much as 22% on plans to launch a division to develop a marketplace for nonfungible tokens (NFTs).
Meanwhile, prices of highly-volatile cryptocurrencies have tumbled since hitting all-time highs late last year. Bitcoin was last trading at $44,306.29 on Thursday, about 36% below its all-time peak.
Coinbase buys crypto futures exchanges, plans to sell derivatives in U.S
(Reuters) - Major cryptocurrency exchange Coinbase said it is buying a crypto futures exchange, FairX, as part of a move to offer crypto derivatives to traders in the United States.
FairX, which was launched last year, is the operating name of LMX Labs. It sells futures products and is regulated by the U.S. Commodity Futures Trading Commission (CFTC).
Coinbase said it wants to make trading of regulated crypto derivatives accessible to retail and institutional customers.
"The development of a transparent derivatives market is a critical inflection point for any asset class and we believe it will unlock further participation in the cryptoeconomy for retail and institutional investors alike," it said in a blog post on Wednesday.
Trading of cryptocurrency derivatives has grown rapidly since institutional investors have over the past 18 months begun to embrace digital coin trading, presenting big opportunities for platforms that offer future and options.
Crypto derivatives volumes totalled $3.3 trillion in November, according to UK research CryptoCompare, accounting for almost 55% of the total crypto market.
Crypto futures and options products, especially those offered by regulated platforms, are widely seen as less risky than buying and selling cash trading.
That likely makes them more appealing for institutional investors seeking to gain exposure to cryptocurrencies, many of whom are balancing the lure of fast gains with the lingering risks in the emerging industry.
The deal is expected to close in the first quarter, the company said.
Shares in Coinbase ended 1% lower on Wednesday after registering its first day of net gains this year on Tuesday reaching above $246 though it remains down around 39% since it went public in April last year.
Shares were up nearly 3% at $241.20 in premarket trading.
Shares of blockchain-related firms fell earlier this week as bitcoin slid below $40,000. It remains significantly below the all-time high of $69,000 it reached in November last year.