Bitcoin Daily: DeFi Platform ALEX Nets $5.8M in Funding; Bitcoin Value Dips, Recovers on China Crackdown, New US Crypto Tax Law

Decentralized finance (DeFi) platform ALEX announced on Monday (Nov. 15) new financing in the amount of $5.8 million, which will go toward the company goal of building its trustless, blockchain-based DeFi services.

Per the release, ALEX will bring “full DeFi services” to bitcoin through its over $100 billion in total value locked in the ethereum ecosystem.

The company’s services allow for a variety of things, including projects for companies to roll out tokens, fixed-rate and fixed-term lending and borrowing, a decentralized exchange utilizing an automated market maker and off-chain order book, deposit tokens that can earn interest and the option to get better returns.

The release says that through dynamic collateral rebalancing, ALEX lets people borrow without worrying about liquidation. Instead of bitcoin being of a static value like digital gold, ALEX will “engage bitcoin with the world” and let it grow, benefit society and contribute to new financial infrastructure goals.

The round was led by White Star Capital. Other participants included Cultur3, GBIC, OK Blockchain Capital and others.

“In traditional finance you are forced to trust in people and to trust in the middleman, but all around you there is a lack of trust,” said Dr. Chiente Hsu, CEO of ALEX. “With DeFi, you don’t have to trust people and you can verify everything by placing that trust only in code, which can open up opportunities for people looking to take out a loan or other financial services.”

Meanwhile, Bitcoin’s price has been tumultuous as of late, with a report from Business Insider saying that the coin tumbled near the $60,000 mark on Tuesday (Nov. 16), due to several “bearish factors.”

Those included the passing of the U.S. $1 trillion infrastructure bill, which adds stricter rules on crypto-trading taxes, along with some news from China regarding crypto mining.

The U.S. bill focuses on upgrading the public works system in the country, though it also comes with an appendage adding rules against crypto brokers. The rules say brokers have to report transactions over $10,000, but critics say the stipulation is too vague and could rope in other crypto workers like miners, traders and node operators.

Meanwhile, in China, the country’s harsh rulings on the crypto market continue, with state-owned firms receiving a new warning to quit mining.

The government is trying to make the sector cleaner and cut down on the carbon footprint. According to some reports, Beijing is also looking at other options, such as upping power prices for institutions that break these rules.

The report notes that Meng Wei, a spokesperson for China’s National Development and Reform Commission, said virtual currency mining was harmful and said it consumed too much energy, with risks becoming more obvious as of late. The report says China’s electricity use surged 12.2% from January to October year-over-year.

Despite these developments, bitcoin was soon trading above $60,000 again, per a report from Fox Business.

Bitcoin had dropped over 5% in value in the past day, at that time of publication, though its value is still up around 110%.

PYMNTS reports that crypto in general is doing well, growing fourfold in 2021, now valued above $3 trillion, according to Bloomberg. Bitcoin’s value is a huge part of that, surpassing $1 trillion.

Read more: Cryptocurrency Hits $3T in Value, a New Milestone