News Roundup — MicroStrategy Accelerates Bitcoin Buying With Record Purchase

Major news stories this week;

1. MicroStrategy Accelerates Bitcoin Buying With Record Purchase
2. Trump Picks Pro-Crypto Hedge Fund Manager Scott Bessent for Treasury Secretary
3. UAE’s VAT exemption for crypto assets creates whole new possibilities
4. FCA to Implement UK Crypto Regulation Framework by 2026
5. Cantor Fitzgerald acquires 5% stake in Tether for up to $600M: Report

Story Summaries;

1. MicroStrategy Inc. purchased a record $5.4 billion in Bitcoin from November 18-24, bringing its total holdings to $38 billion, making it the largest publicly traded corporate holder. The purchase was funded through a $3 billion convertible note and share sales. Under CEO Michael Saylor, the company has used a strategy of raising capital through debt and equity to acquire Bitcoin, which has helped drive its stock up over 500% this year. However, the high-leverage approach has drawn concerns, as a significant Bitcoin price drop could negatively impact both the company's stock and its holdings.
2. U.S. President-elect Donald Trump named hedge fund manager Scott Bessent, a cryptocurrency enthusiast, as his pick for Treasury Secretary.Bessent runs Key Square Group, a macro investing firm. He worked for prominent investor George Soros three decades ago and was, according to The Wall Street Journal, "one of the driving forces" behind Soros Fund Management's famous bet — that netted a more than $1 billion profit — that the British pound would collapse.Bessent believes crypto aligns with the Republican ethos of freedom and has the potential to engage younger, previously underserved markets. His appointment, if confirmed, would make him a key figure in shaping U.S. financial policy with a pro-crypto stance.
3. VAT Exemption for Virtual Assets: UAE exempts virtual asset transactions from VAT, effective retroactively from January 1, 2018, and for asset management from November 15, 2024, clarifying tax treatment.
   Boost to UAE's Competitiveness: The exemption positions the UAE as a global hub for digital assets, attracting businesses and stimulating innovation.
   Future Implications: The exemption could attract custodians but may introduce regulatory complexities, with the Federal Tax Authority expected to issue further guidance.
4. The UK’s Financial Conduct Authority (FCA) plans to implement a crypto regulation framework by 2026, responding to rising cryptocurrency adoption. The FCA will release discussion papers on issues like market abuse, stablecoins, and trading platforms by 2025, with final policy statements set for 2026. A recent FCA study found that 10% of the UK population owns crypto assets. The UK aims to create clear regulations to prevent startups from moving abroad, particularly to the US, and will align its framework with the EU's upcoming MiCA regulations.
5. Cantor Fitzgerald acquires a 5% stake in Tether valued at up to $600 million, potentially strengthening political support for Tether as CEO Howard Lutnick assumes a key role in President-elect Donald Trump’s administration.
   Lutnick’s dual roles as Tether supporter and Trump transition adviser position him to influence decisions affecting Tether, including ongoing investigations into its operations, while stepping down as CEO upon Senate confirmation.
   Tether’s reliance on Cantor Fitzgerald remains critical, with the firm holding most of Tether’s $134 billion reserves in U.S. Treasury bills, as well as announcing plans to launch a $2 billion Bitcoin lending program.

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And that’s all for last week’s news! Wishing you a great week ahead!

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