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BlackRock files for Bitcoin ETF, Coinbase and NASDAQ listed as partners

In a potential gamer for crypto markets, asset management giant BlackRock is moving to launch an exchange-traded fund for Bitcoin. In an application filed on Thursday, the company sought permission to sell the currency through a vehicle called the iShares Bitcoin Trust.

The move is significant because of BlackRocks enormous reach, and because it would allow retail investors to buy Bitcoin as shares of an ETF from an ordinary brokerage account. Likewise, it would make it easer for institutional investors to hold the asset.

The ETF application states that Coinbase would be tasked with holding the trusts underlying Bitcoin as a custodian. It also states that Nasdaq oversee the pricing data that informed the spot market pricea potentially critical factor since the Securities and Exchange Commission has no far refused to permit a Bitcoin ETF, citing fears of market manipulation.

The price of Bitcoin, which has been slumping in the face of regulatory pressures and hawkish monetary policy from the Federal Reserve, jumped around 3% on news of the BlackRock application.

While it has become increasingly to buy Bitcoin in recent yearswith everyone from Coinbase to PayPal to Robinhood offering it for salethere is still no easy way to obtain it in the form of traditional shares. This has proved an impediment for large institutions, which are restricted by-laws that limit what sort of asset they may by.

Currently, the most popular option to acquire Bitcoin in the form stock is the Grayscale Bitcoin Trust, which does not trade on a major stock exchange. The Grayscale trust also charges a management fee of around 2% a year, which is viewed as too high by many investors.

BlackRock is hardly the first to seek to offer Bitcoin as an ETF, where fees are typically well under 0.5%. Grayscale and a number of funds have also sought permission, but have been denied by the SEC.

According to a source familiar with the BlackRock application, the company believes it will be able to succeed where other applicants have failed, in part because of its pedigree, but also because NASDAQ will be overseeing the pricing dataa situation the person believes will ease concerns about the EFT manager manipulating the asset price on which the ETF is based.

The SEC last year finally granted permission for a crypto ETF, but only for futures marketsa product that is significantly more complicated than a spot market ETF, and one that is more expensive for investors. Grayscale has sued the agency over this decision, saying it is arbitrary and, based on a recent federal court hearing, analysts have said the company has a high chance to prevail.

This breaking news story will be updated shortly.

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Do Kwon to be taken into extradition custody as Montenegro considers South Korea's request

Do Kwon, a cofounder of the failed algorithmic stablecoin TerraUSD, could be detained for up to six months in Montenegro as authorities decide whether to extradite him, according to Radio Free Europe.

A spokesperson for the High Court of Montenegro confirmed to the outlet that Kwon will remain in detention while the country weighs a request from South Korea. Kwons home country issued a warrant for his arrest in September. The U.S. has also requested his extradition.

The disgraced crypto founder had been on the run from authorities for months before he was arrested in March trying to leave Montenegros capital, Podgorica, for Dubai using a fake Costa Rican passport. Authorities also recovered what they described as forged passports from Belgium and South Korea for both Kwon and Han Chong-joon, the former chief financial officer of Terraform Labs, who also was arrested. Kwon was charged with attempting to use forged travel documents, and pleaded not guilty.

Although a judge originally granted Kwon and his associate a six-figure bail, the decision was later overturned after the prosecution appealed.

Earlier this month, local news outlets reported that Kwon allegedly contributed to Europe Now, a political party founded by the crypto-friendly politician Milojko Mickey Spajić. The Montenegrin government claimed that Kwon has ties to Spajić, citing a letter Kwon sent from custody to the outgoing prime minister, Dritan Abazovic, stating that he and Spajić were business partners.

Opponents of Europe Now called for the Special State Prosecutors Office to investigate the allegations in Kwons letter, while Europe Now was dismissive of it, calling the criticism of any Kwon-Spajić ties a political attack.

On Sunday, Europe Now won about a fourth of the seats in the Montenegrin parliament. The party is now looking to organize a coalition with other parties to form a government. As Europe Nows leader, Spajić has a shot at the top job in the Montenegrin governmentprime minister.

Kwon is likely to be questioned by the Special State Prosecutors Office about his ties to Spajić. Kwons next hearing is Friday, according to Radio Free Europe.

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There wont be a true recession anytime soonbut a growth recession is still on the menu next year, BofA warns

After taking over the chief economist gig at Bank of America last July, Michael Gapen quickly warned that the U.S. economy was headed for a mild recession by years end. Gapens predecessors had long avoided overly bearish predictions, but he feared the worst amid persistent inflation and rising interest rates. However, the former Barclays exec revised his initial forecast in September after consumer spending and the labor market held up better than hed expected, arguing that a mild recession wouldnt come until the first half of this year.

And now, as with many of his peers, Gapens forecasts have proven to be, at the least, a bit premature. Despite stubborn inflation and doomsday predictions from billionaire investors, the U.S. economy continues to push forward, with the unemployment rate sticking near pre-pandemic lows and retail sales proving to be resilient. The stock market has also rebounded after a dismal 2022. The S&P 500 is now up more than 15% year to date amid investors increasing enthusiasm over the potential for A.I. to reshape the global economy.

The good news forced Gapen to revise his recession forecast once again this week. He now says theres going to be a softer downturn, and it wont come until 2024.

We have taken on board the improved risk backdrop and further evidence of resilience and moved out the timing of our anticipated downturn, the economist wrote in a Wednesday note to clients. We acknowledge that this is not the first time we have done so.

Gapen said he wants to avoid forecasting a perpetual downturn six months into the future, but added that he still believes the Federal Reserve will be forced to raise interest rates until there is a significant increase in unemployment if it wants to tame inflation. Although year-over-year inflation slowed from its June 2022 high of 9.1% to 4% last month, it remains well above the central banks 2% target rate.

That said, we have softened the magnitude of the downturn given the improved picture on labor supply and evidence that some disinflation has occurred without any real backup in the unemployment rate, Gapen wrote. Our forecast is now as much a growth recession as it is a mild recession.

A growth recession involves a period of low but positive economic growth and rising unemployment, whereas a pure recession is a period of widespread and sustained economic contraction, usually defined as two quarters of negative GDP growth.

Gapen said he updated his recession forecast this week due in part to a rapid rebound in labor supply caused by increased immigration and improved workforce participation rates. This rebound has helped the unemployment rate to remain low and held down wage growth, enabling inflation to fall from its June 2022 four decade high without sparking a recession, he said.

Risks to U.S. economic growth have also begun to fade in recent months, according to the economist, who pointed to examples like the passage of the debt ceiling and the Feds actions to contain stresses at regional banks after the blowup of Silicon Valley Bank in March.

We did not expect adverse fireworks from a debt limit debacle, but nonetheless, its passing reduces uncertainty, he wrote. In addition, while it is too early to declare all clear on risks of a credit crunch in bank lending, stresses in the regional banking sector do not appear to be getting worse, and spillovers have so far been avoided.

Gapen also noted that the Biden Administrations CHIPS and Inflation Reduction Act (IRA), and Infrastructure Investment and Jobs Act (IIJA), which are aimed at spurring investment in the manufacturing sector, have helped boost economic growth.

He said he now expects U.S. GDP to rise 1.1% in the fourth quarter of this year, compared to his September prediction for a 0.2% drop. But the economist lowered his forecast for 2024 GDP growth from 0.9% to 0%, arguing that the economy will spend much of next year recovering from its first-half growth recession.
Bank of America isnt the only investment bank to turn bullish on the economy recently. Goldman Sachs economists revised their recession forecast earlier this month as well, arguing there is now just a 25% chance of a U.S. recession this year, down from 35% in March. And Stifel followed suit, with analysts claiming there wont be a textbook recession anytime soon.

Vladimir Putin is a 'Dostoevsky-type figure' whose survival is improbable if Ukraine prevails, Henry Kissinger says

President Vladimir Putin may struggle to hold on to power if the war in Ukraine forces Russia to abandon military aggression and accept a peace deal with Europe, former US Secretary of State Henry Kissinger said.

I would like a Russia that recognizes that its relations to Europe have to be based on agreement and a kind of consensus and I believe that this war will, if its ended properly, may make it achievable, Kissinger told Bloombergs Editor-in-Chief John Micklethwait in an interview. Asked whether Putin could survive in power if the war ended on those terms, Kissinger replied: Its improbable.

The veteran diplomat said its important that Ukraine emerges from the war as a strong democracy, and preferable to avoid the dissolution of Russia or the reduction of Russia to resentful impotence that risked stoking new tensions. He described Putin as a Dostoevsky-type figure beset by ambivalences and unfulfillable aspirations, who was very capable of wielding power as a leader and used it excessively in relation to Ukraine.

The June 7 interview in New York was a retrospective on Kissingers life and career after he recently turned 100. You can see the full recording here.

Putin has frequently welcomed Kissinger to Russia during his near quarter-century rule in the Kremlin and said at a 2012 meeting that their relationship stretched back to the mid-1990s when he was deputy mayor of St. Petersburg. Kissinger said in his Bloomberg interview that Putin was both the inheritor of a traditional Russian outlook and also someone who grew up on the streets of Leningrad, now St. Petersburg, where more than half the population died of starvation during World War II and faced constant threat.

Putin translated that into never wanting European military power to be in easy reach of St. Petersburg and major cities like Moscow, and reacted at the edge of irrationality to its expansion, Kissinger said.

While the US and its allies were correct to resist Russias attack on Ukraine, its increasingly important that parties to the conflict consider how they want to end it through diplomacy, Kissinger said. Theres a risk that military relations between powers dominate geopolitical thinking and turn the war into a global conflict by drawing in countries like China, he added.

Europe will become more stable, the world will become more stable when Russia accepts the fact that it cannot conquer Europe, but it has to remain part of Europe by some sort of consensus as other states do, he said. But at the moment Russia is so crushed that it sees its being a factor of international politics in other regions and becomes a subject for European competition among the various states.

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ONE joins the fintech battle for banking customers with a 5% APY high-yield savings account

ONE, a financial technology startup backed by Walmart, just raised its rate on savings balances to 5% APY. Thats more than 12 times the national average savings account rate of 0.4%, according to FDIC data.

ONE isnt the only tech company to offer exceptionally high rates on savings accounts in the wake of multiple rate hikes by the Federal Reserve. Apple, for example, launched its own high-yield savings account in partnership with Goldman Sachs earlier this year, which currently offers a 4.15% APY. And Step, a platform designed to help teens and young adults become financially independent, now also offers 5% APY on savings.

These rates rival some of the best high-yield savings accounts on the market today. For example, financial institutions such as Varo Bank and My Banking Direct also currently provide 5% APY on their high-yield savings products. Many more have rates above 4% APY, particularly those that operate via the web.

At the same time, mainstream banking institutions have received some criticism for keeping their savings account yields low, despite the fact that the Fed raised rates 10 times since March 22, to a target rate of 5.00% to 5.25%. This has given tech-focused banks and financial platforms the opportunity to pull customers away with competitive yields.

How to earn 5% APY with a ONE account

ONE users can qualify for this rate on balances up to $100,000 by setting up direct deposits of at least $500 per month, or maintaining a daily balance of at least $5,000. Any balance over the $100,000 threshold will earn 1% APY.

This account doesnt charge any monthly maintenance fees and theres no minimum balance required.

What is ONE (and is it safe)?

Its important to point out that ONE is a financial technology company, not a bank. Even so, deposits are protected up to $250,000 per depositor by the FDIC through ONEs banking partner, Coastal Community Bank. Since its the banking provider, Coastal Community Bank is where these accounts are held. But ONE is the company that services your account. (So if you ever have any issues with your account, you should get in touch with ONE Customer Service.)

The concept behind ONE is save, spend, and grow your moneyall in one place. To that end, ONE accounts are essentially checking accounts. They include a checking tab, as well as a savings tab that buckets your funds into primary savings and custom savings pockets. So while those various pockets might seem like separate savings accounts, technically, theyre subsections of one main account, which is a checking account.

The takeaway

When the Fed raises rates, it tends to impact lending more directly than deposit products. Still, a handful of financial institutions and tech companies have proven its possible to offer savings account rates of 5% and upif thats the priority.

Seeking out high-yield savings accounts is a smart way to help your savings grow faster. However, before depositing your money in a new account, verify that the bank is FDIC-insured and has a strong reputation.

Binances U.S. subsidiary lays off about 50 employees, cites costly litigation process

Binance.US, a reportedly independent subsidiary of crypto giant Binance, began a round of layoffs a little more than one week after the Securities and Exchange Commission sued the exchange and its founder, Changpeng Zhao.

There were approximately 50 people included in the cull, a source with knowledge of the dismissals told Reuters.

Because of a costly litigation process, Binance decided to shrink the size of our teams across the company and reduce our burn rate, according to documents reviewed by CoinDesk.

Unlike every other U.S. crypto company, we have been working to avoid this scenario, but circumstances have now shifted, continued the documents. This was a very hard decisionone that we didnt take lightly. We are sad to see our colleagues depart, but we wish them the best and will do what we can to assist them in this transition.

The layoffs follow another round of reported cuts at Binance at the end of May. As opposed to the earlier round, which Binance claimed was to evaluate whether it has the right talent, this time, according to the documents, is in direct response to the litigation.

In a 136-page lawsuit, the SEC alleged a series of 13 charges against Binance, its U.S. subsidiary, and Zhao. These include selling unregistered securities and therefore operating as an unregistered securities exchange. The agency also claimed that Binance subverted controls to secretly allow high-value U.S. customers to continue trading on the Binance.com platform despite the service being closed to the region. (The Commodity and Futures Trading Commission made similar accusations in a lawsuit filed in late March.)

Shortly after it filed its lawsuit, the SEC asked the federal judge overseeing the case to freeze Binance.USs assets. And in response to the heightened regulatory pressure, Binance.US decided to prevent users from trading in dollars on its platform and rebranded itself as a crypto-only exchange.

The federal judge overseeing the case told Binance.US and the SEC to reach an agreement among themselves without a court order. Meanwhile, in the aftermath of the lawsuit, net negative outflows from Binance.US and the larger Binance.com have amounted to billions.

A spokesperson for Binance did not immediately respond to a request for comment.

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Billionaires are being demoted to millionaires in most of the worlds 15 wealthiest countries

Where does a billionaire like to call home? For many, its probably a nondescript multi-million villa with sleek marble counters and hidden appliances they never use. But where that mansion is located depends on the billionaire. In its latest Billionaire Census, data intelligence company Altrata looked at Wealth-Xs database of ultra-wealthy individuals to examine the state of the worlds billionaire class today. Its research found that three-quarters of the cohort are concentrated across 15 countries.

Yet, 11 of these countries are losing their billionaires. Its likely that some are on the move to another country, while others are merely falling out of the 10-figure club altogether. The billionaire population has declined overall by 3.5%, the report found, losing a cumulative $11.1 trillion in wealtha 5.5% drop. That comes after billionaires experienced a surge in wealth during the first couple years of the pandemic.

The United States is home to the most billionaires955 (30% of the global billionaire population), worth a collective $4.2 trillion (38% of total billionaire wealth worldwide). Despite being the top dog, the U.S. saw a 2.1% decline in billionairesless than the global average, but higher than eight of the top 15 countries.

Thats not as big as drop as Chinas 10% drop, the largest of any country on the list. The report attributes the decline to sliding equities, COVID lockdowns, real estate strains, and a subdued economy. Its significant enough that its widened the wealth gap between the country and the U.S., but it still ranks second on the list.

Meanwhile, Germany (number three on the list) was the European country that fared best by billionaire standards. Despite the impact from Russias invasion of Ukraine, the country still only experienced a slightest fall in its billionaire population, though those billionaires experienced a near 8% decrease in cumulative wealth. The country still has the largest population of billionaires in all of Europe, ranking third on the list, followed by the U.K., which also saw its billionaire population drop.

So too, did India, which ranks fifth. It seems as if billionaires are dropping like golden flies in every country except for Russia and Singapore, both of which saw an increase in billionaires by 4.7% and 8%, respectively. While Russias invasion caused ripples in other countries, magnets in the country seem to have rebounded from imposed sanctions, as Forbes reports.

But despite many countries experiencing a decline in billionaires, the actual wealth of billionaires increased in some countries like UAE, Saudi Arabia, and Brazil. Given a broad downturn in global capital markets, this illustrates the diversity of billionaires wealth holdings at an individual and country level, and the very uneven impact of geopolitical events on different wealth markets, the report reads.

The existence of billionaires in general speaks volumes to global income inequality. In the U.S., it increased for the first time in 10 years, according to Census data from 2021. Its since plateaued a bit, but still remains a large issue both in the U.S. and across the world. Lenient taxes make it so billionaires profit and proliferate, explains Bob Lord, a tax lawyer and senior advisor regarding tax policy for the Patriotic Millionaires, a group of high-net-worth individuals pushing for greater taxes on the wealthy, explains for Fortune; only 40 years ago, there were just 13 billionaires in the U.S. Now, many billionaires ranging from Warren Buffett to Charles Koch are worth more than the cash balance in the Treasury Department, points out the New York Times.

So even if the pandemic height of their wealth might slowly be falling, billionaires are still doing just fine. Here are the countries with the most billionaires, and how many billionaires they actually have:

1. United States: 955

2. China: 357

3. Germany: 173

4. United Kingdom: 114

5. India: 113

6 (TIE). Russia: 112

6 (TIE). Hong Kong: 112

8. Switzerland: 110

9. Saudi Arabia: 71

10. Italy: 67

11. France: 65

12. Canada: 56