Ten31 Timestamp 802,098
The increasingly unsustainable path of US debt was the prime topic of most financial headlines this week, as the US Treasury’s latest estimates pointed to an incremental $2 trillion of borrowing to come in the back half of the year after adding over $1 trillion in the ~2 months since the latest suspension of the debt ceiling. Ratings agency Fitch downgraded US debt to a still questionable AA+ rating, sending US Treasury yields back toward 15-year highs.
Portfolio Company Spotlight
Fold is a financial services platform providing the most comprehensive bitcoin-denominated consumer rewards programs. Fold offers both free and premium debit cards that accrue cash-back rewards in bitcoin that can be withdrawn to customer-controlled wallets, as well as a rotating set of gift cards and promotions for top retailers with different levels of bitcoin benefits. Rewards, gift cards, and promotions are managed through an intuitive app that also offers easy, direct bitcoin buying. Fold is also ramping up its Enterprise API, a first-of-its-kind B2B offering which will allow merchants, brands, and fintechs to easily design white-labeled bitcoin and other rewards programs powered by Fold’s infrastructure.
Selected Portfolio News
Samourai released its latest wallet software update, which improves on it recently released JoinBot tool, adds message signature verification, and more:
Samourai Whirlpool also reached another capacity all-time high:
Unchained added batch spending functionality to its Vaults:
Peach released its latest app update, including support for LNURL swaps:
Jack Mallers, Obi Nwosu, and Harry Sudock – representatives of Ten31 portfolio companies Strike, Fedi, and GRIID, respectively – were the first guests on Bitcoin Brainstorm, a new monthly show hosted by Cathie Wood, Yassine Elmandjra, and Bitcoin Park Co-Founder.
Upstream Data Founder and CEO released a detailed walkthrough of the Hash Generator, one of the company’s flagship products.
Mutiny published an essay taking a closer look at how the wallet interacts with Voltage’s Lightning Service Provider (LSP) to enhance user privacy.
River CEO Alex Leishman appeared on Preston Pysh’s podcast to discuss scaling the lightning network.
Unchained published a video delving into some key bitcoin privacy concepts.
The US Treasury released updated borrowing estimates this week indicating a plan to borrow almost $2 trillion in just the back half of 2023.
A few days later, ratings agency Fitch – renowned for its precise and predictive assessments of credit quality – downgraded US Treasury debt from AAA to AA+ due to rising deficits, debt to GDP, and ballooning interest payments.
The US 10-year yield flirted with 4.2% most of the week, in line with the 15-year high it set last fall, while the 30-year yield was at one point up 30bps over just two days.
Volatility also plagued the Japanese bond market this week, with 10-year JGB yields breaking 65bps for the first time in nearly a decade on the back of the Bank of Japan’s tighter yield curve control policy.
US non-farm payrolls were up 187,000 in July, below consensus estimates. May and June payroll readouts were also revised down, in line with every other monthly payroll report in 2023 (the longest such streak in the past 25 years).
Meanwhile, the latest data for US state and local government tax revenue showed Y/Y declines surpassed only by the troughs of 2008 and 2020.
Bloomberg ETF analysts raised their odds of US spot bitcoin ETF approval from 50% to 65%.
Reports this week indicated the US Department of Justice is considering bringing fraud charges against prominent exchange Binance, but officials reportedly worry that doing so could trigger a bank run.
Republican Presidential Candidate Ron DeSantis pledged to end President Biden’s “war on bitcoin” if elected to the office.
The UK government is nearing passage of legislation known as the Online Safety Bill that would dramatically erode communications privacy in the name of ostensibly combating terrorism and child abuse.
In a profoundly unsurprising development, the company behind Worldcoin has already begun discussing partnerships with corporations and governments interested in using its eyeball-scanning technology and ID system.
Coinbase CEO Brian Armstrong said the company is still “looking into” how to integrate lightning network capabilities to the exchange.
Tether, the largest dollar stablecoin on the market, reported that it had added another 1,529 bitcoin to its treasury during Q2.