By
Godfrey Benjamin
May 10th, 2024
Along with holding Bitcoins on its balance sheet, Bitfinex also supports Bitcoin Layer 2 networks, such as the Lightning Network and the Liquid Network.
Similar to some of the big corporates, crypto exchange Bitfinex announced that it’s holding Bitcoins on its balance sheet. Bitfinex has a longstanding practice of retaining a portion of its trading fee revenue in Bitcoin.
This serves as a testament to its enduring commitment to the world’s first and largest cryptocurrency. However, an unnamed source told The Block that the exchange declined to comment on its absolute Bitcoin holdings.
Paolo Ardoino, the CTO of Bitfinex, took to Twitter on Sunday to express his belief that cryptocurrency exchanges that have greatly profited from Bitcoin should establish a policy of reinvesting a portion of those profits back into Bitcoin.
Bitfinex follows this approach by actively supporting Bitcoin Layer 2 networks, such as the Lightning Network and the Liquid Network. It also contributes to the development of the RGB protocol. This protocol facilitates more cost-effective and private transactions, simplifying the process of token issuance on the Bitcoin network, as Ardoino highlighted.
“Bitfinex reinvests in Bitcoin technology. It’s much more than simply buying bitcoin,” he added.
Bitfinex’s Sister Concern Tether Also Holds Bitcoins
The fact that Bitfinex holds Bitcoin on its balance sheet has not been previously disclosed. Additionally, Bitfinex’s sibling company and issuer of the stablecoin Tether is reported to be the 11th largest Bitcoin holder globally.
Tether initially revealed its Bitcoin holdings during the first quarter of this year, announcing its intention to regularly invest up to 15% of its profits in Bitcoin as part of a shift from US government debt to cryptocurrency in its reserves. Currently, the stablecoin issuer possesses approximately $1.6 billion worth of Bitcoin.
Bitfinex and Tether are among a select group of firms that have included Bitcoin on their balance sheets. Other notable entities with Bitcoin holdings include MicroStrategy, Tesla, and Square. As of the latest data, Bitcoin is presently trading at approximately $25,699.
In recent weeks, Bitcoin has come under major selling pressure with its price tanking under $26,000 and falling under crucial support levels like the 200-day moving average.
However, it seems that institutional participation in Bitcoin is growing further with time. Some of the biggest financial giants such as BlackRock, Fidelity, and others are looking to bring their spot Bitcoin ETFs into the market. While Bitfinex reports holding BTC on its balance sheet, Elon Musk’s SpaceX reportedly sold off its BTC last month.