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Stellar Development Foundation Injects $5 Million Into Crypto Wallet Abra to Leverage Products Expansion

The Stellar Development Foundation has invested $5 million to crypto investment app Abra. Now Abra will integrate the Stellar blockchain into its platform and also leverage Stellar-based products.

Abra is a crypto-financial services app that gives users exposure to cryptocurrency and stock investments. On the other hand, The Stellar Development Foundation is a non-profit, which supports the development of the Stellar network.

Working together to take crypto access mainstream

The Stellar Development Foundation said that its investment would help Abra to expand its services and products on the Stellar network. Abra CEO Bill Barhydt stated that his team will leverage Stellar’s ability to use traditional banking infrastructure as it builds yet more banking tools.

Baryhdt said, “Our goal is to democratize access to financial services. As we integrate with Stellar, we’re going to be able to build the next generation of banking (infrastructure).” He said that Abra would continue to offer Bitcoin as a core asset in the company’s system since Bitcoin remains the most popular crypto asset in the Abra app for both Android and iPhone users.

The Stellar Development Foundation chief Denelle Dixon stated that the $5 million investment would bring value to both the Stellar network and Abra’s expanding portfolio of financial services. Dixon commented, “This investment marks the beginning of our partnership to work together towards creating equitable access to financial services that also create new, innovative business opportunities for the Stellar network.”

Abra is a crypto wallet provider platform that harnesses Bitcoin and smart contracts and uses crypto-collateralized contracts as a gateway into price exposure for other financial assets and products. Using Stellar would enable Abra to have broader capabilities and a wider reach in its offerings.

However, it remains unclear regarding what specific offerings Abra intends to build on Stellar. Lomesh Dutta, Vice President of Growth at Abra said that the company would announce product details concerning its partnership with Stellar in the coming months. Currently, Abra provides an investment app, which enables users to invest in over 100 cryptocurrencies, including stocks and exchange-traded funds.

Abra was founded in 2014 as a Bitcoin remittance mobile app. Since then, the San Francisco-based company has steadily added more coins and crypto services and also attracted more venture funding as its team gets financial links around the globe. The company is backed by high profile investors like American Express Ventures, electronics manufacturing giant Foxconn, and others. The $5 million that Stellar Foundation offers in this week is an addition to over $30 million that Abra has raised to date.

Franklin Templeton to enable money fund shares on Stellar Network

Apart from being recognized as a competitor to Ethereum, Stellar network is considered as one of the blockchain platforms with the most potential. Stellar is an open-source, decentralized protocol for cryptocurrency to fiat money transfer that allows cross-border transactions between pair of currencies. Stellar has been partnering with several entities to develop business landscapes around the world. Last September, Franklin Templeton, an American asset management firm, chose Stellar to tokenize government money market funds on the Stellar network. In other words, the American asset management firm chose the Stellar network to maintain and record the ownership of the fund’s shares so that to enhance transparency and minimize settlement times, including other benefits to shareholders. This clearly demonstrates that Stellar is a famous, well-respected, and reputed platform.

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SEC Charges App Developer Abra for Unregistered Security-Based Swaps

Abra and its affiliate Plutus Tech have agreed to a cease-and-desist order and a combined penalty of $150,000 after being charged by the Securities and Exchange Commission for selling unregistered security-based swaps to investors in 2019.

The Securities and Exchange Commission (SEC) has charged California-based Abra and a related firm Plutus Tech in the Philippines for the sale of unregistered security-based swaps to retail investors and for failing to transact those swaps on a registered national exchange.

According to the official SEC release on July 13, by leveraging Abra’s app, users were able to enter into contracts that provided them with synthetic exposure to price movements of stocks and securities trading in the Unites States—through blockchain-based financial transactions. Users could then choose to mirror these securities and make an investment that would rise and fall with the real-world price. The regulators state that these swap transactions violated US securities law.

Abra first started offering the security-based swaps to investors in February 2019 in the US and abroad. According to the SEC, Abra marketed its app to retail investors but took no steps to determine whether users who downloaded the app were “eligible contract participants” as defined by the securities laws.

According to the order, Abra stopped offering contracts to US investors in February 2019, after conversations with SEC staff, only to resume the business in May 2019, this time limiting the sales to non-US people. However, the SEC maintains that Abra’s employees in California designed and marketed the swap contracts, as well as screened and approved the users. The SEC also states that it was Abra’s US-based employees who effected thousands of stock and ETF purchases withing the US to hedge the contracts.

“Businesses cannot ignore the registration requirements designed to provide investors with the information necessary to evaluate securities transactions,” said Daniel Michael, Chief of the SEC Enforcement Division’s Complex Financial Instruments Unit, “Further, businesses that structure and effect security-based swaps may not evade the federal securities laws merely by transacting primarily with non-U.S. retail investors and setting up a foreign entity to act as a counterparty, while conducting crucial parts of their business in the United States.”

After being charged by the SEC for violating federal securities law—Abra, and its Philippines-based affiliate Plutus Tech have agreed to a cease-and-desist order and to pay a combined penalty of $150,000. In a parallel action, the Commodity Futures Trading Commission (CFTC) also announced a settlement with Abra and Plutus Technologies for similar conduct.

Abra's CEO Confirms 50% of His Investment Portfolio is Now in Bitcoin

Bill Barhydt, the Chief Executive Officer (CEO) of Abra, a crypto wallet service provider has revealed that approximately 50% of his investment portfolio is now in Bitcoin (BTC). The revelation made by Barhydt through his Twitter handle came after the historic week wherein Bitcoin recorded its highest price for 2020 at approximately $13,200.

There has been a massive institutional adoption of Bitcoin in recent times with many renowned CEO’s taking a position in the premier digital currency as most see a promising future for the coin amidst the inflationary rise of the United States Dollar caused by the COVID-19 pandemic.

While every CEO has a specific reason for either investing or increasing their Bitcoin portfolio, Barhydt stated that he believes:

“Bitcoin is the best investment opportunity in the world right now. There are three reasons I believe this to be true today…. Fundamentals, Technicals, and Sentiment.”

Per the fundamentals, Barhydt said that the 21 million caps of bitcoin, its decentralized nature, stock to flow as well as the upcoming improvement in “privacy features” were the point of attraction for him. He also noted that the technicals backing bitcoin’s imminent surge are strong while the increased embrace of the coin will be seen as the sentiments around the coin grows.

Abra is a crypto-financial services app that gives users exposure to cryptocurrency and stock investments and has attracted funding from industry giants including the Stellar Development Foundation that injected $5 million into the company as reported by Blockchain.News back in May.

Barhydt now joins the likes of Paul Tudor Jones, CEO, and founder of Tudor Investment Corp, Nasdaq listed MicroStrategy Incorporated as well as Jack Dorsey of Square Inc who recently pumped liquidity into Bitcoin. Expectations for Bitcoin’s price to increase as much as five folds by 2023 seems to explain why most of these institutional investors are being bullish on the coin at this time.

Abra Appoints Justin McMahan As Chief Financial Officer

Abra, a rapidly rising crypto wealth management platform based in San Francisco, announced on Wednesday the appointment of Justin McMahan as the company’s first-ever Chief Financial Officer, effective immediately.

McMahan’s appointment comes during a period of rapid growth for Abra. In the new role, McMahan will be tasked with optimizing the company’s financial performance, ensuring compliance with global accounting standards and helping direct Abra’s growth strategy in the forthcoming years.

McMahan joins Abra from Tower Research Capital, a high-frequency trading company, where he served as Managing Director and Global Treasurer.

McMahan is a veteran finance executive with more than 20 years of experience in trading, fintech, capital markets, wealth management, and asset management. Most recently, he served senior roles at Tower Research Capital.

Before working at Tower Research, McMahan was a Managing Director and Head of Operations of Treasury & Client Services at Serengeti Asset Management, an investment management company. Prior to joining Serengeti, he worked at Morgan Stanley for 13 years, where he held several roles, including Executive Director of Prime Brokerage Capital Introductions & Risk.

Bill Barhydt, the founder and Chief Executive Officer of Abra, talked about the development and said: “Justin is an exceptional addition to the firm as we continue to build out and differentiate our team with accomplished professionals across digital assets, traditional finance, and wealth management. Justin’s proven track record in executing transformational financial services solutions and leading businesses through dynamic stages of their evolution will be instrumental as we expand our platform and democratize access to the crypto economy.”

Meanwhile, McMahan also commented about his appointment: “Abra has cemented itself as a dominant player in this disruptive space, and I am humbled to join this extremely talented team that provides customers with truly unique access to cryptocurrency markets.”

Enabling Customers’ Access to Digital Assets

Abra was founded in 2015, by Bill Barhydt, a former fixed-income analyst for investment bank Goldman Sachs and former director of Netscape Communications Corporation.

Abra operates a crypto wallet with a built-in crypto swap service, a cryptocurrency lending service, and a crypto staking and high yield savings service. The firm claims to serve more than 1 million users with over $1.5 billion in assets under management.

In March 2018, Abra added support for 20 new cryptocurrencies including Litecoin, Bitcoin Cash, and Stellar into its platform.

In September last year, as reported by Blockchain.News, Abra raised $55 million in a Series C funding led by the Stellar Development Foundation, including other investors such as GNIA, Blockchain Capital, Kingsway Capital, Tiga Investment, among others.

Abra used the funds to expand its new offerings (which include wealth management, trading, and payments) with Stellar as a blockchain back-end and democratize access to them for new customers in developing nations.

Since 2020, Abra has witnessed “tremendous” growth. The firm recorded a ten-fold increase in revenues.

Abra Opens New Division with Yield and Web3 Investment Services for Premium Clients

Abra, a cryptocurrency wealth management platform based in California, announced on Tuesday that it has launched a new asset management division, Abra Capital Management (ACM), which is designed to provide clients with access to enhanced investment opportunities.

Through ACM, Abra’s clients are now able to access actively managed, structured products and investment funds in addition to Abra’s best-in-class trading, buying, and borrowing services.

ACM is designed to provide five funds to customers. Three funds offer yield-generating opportunities in stablecoins, Bitcoin and Ether, while the other two funds provide early-stage token and equity investment opportunities.

Through ACM, Abra aims to provide high-net-worth clients and institutions with unique access to various other digital asset investment opportunities. ACM provides strategic capital to several early Web3 projects as part of efforts being made by Abra to accelerate many of its DeFi strategies. According to the statement, ACM will complement Abra’s high-yield services by providing investors with a wider variety of ways to gain exposure to the growing asset classes.

Bill Barhydt, the founder and CEO of Abra, talked about the development and said: “As investor appetite for access to the emerging digital asset economy has skyrocketed, so has the demand for solutions that can help them diversify their exposure and invest in high-growth, yet relatively inaccessible, vehicles. Most exchanges and crypto platforms are limited in the solutions they can offer.”

Marissa Kim, who recently joined ACM as a general partner, will lead the new business, while Barhydt will serve as a chief investment officer.

ACM is currently open to all Abra customers and investors with a minimum investment size of $250,000.

Bringing Digital Finance to the Traditional Financial Market

The launch of the new asset management division (ACM) followed a funding raise that the firm conducted late last year.

In September last year, Abra raised $55 million in a Series C funding round led by Ignia and Blockchain Capital. The firm stated plans to use the funds to develop high net worth and institutional sales offerings, scale its marketing team, and beef up its product team into new offerings for wealth management, trading, and payments.

Launched in 2014, Abra’s hundreds of thousands of customers earn a high yield on their crypto assets, trade over 100 different cryptocurrencies and borrow dollars against crypto holdings. The company has processed over one billion dollars in crypto-backed loans and has witnessed revenues rise ten-fold in the last year.

Propy Partners with Crypto Lending Platform Abra, Launching Crypto-backed Real Estate Loans

Blockchain-based real estate transaction management company Propy has partnered with digital asset wealth management platform Abra to open up a path to obtain real estate loans with digital assets as collateral.

Propy said that real estate buyers can use Abra Borrow to use their cryptocurrency for mortgage loans flexibly and said that repayment terms are very flexible and offer options as low as 0% to borrow dollars.

It’s an ‘All-In-One’ property transaction solution offering a unified transaction management process.

The CEO of Propy is Natalia Karayaneva, a real estate professional.

He emphasized the importance of finding a partner who can provide highly reliable crypto collateral for being the first company to process real estate transactions as NFTs.

He said about the collaboration：

“Abra’s impressive borrowing platform, proven track record, and customer-first mindset make it a natural fit as a partner. We look forward to working with the Abra team to expand financing options for the real estate ecosystem.”

The popularity of cryptocurrencies has led many real estate developers to accept cryptocurrencies as a means of payment.

Yesterday, Damac Properties, a major real estate development company based in Dubai, United Arab Emirates (UAE), announced Wednesday that it would sell properties using Bitcoin and Ethereum as payment methods.

Hong Kong’s OSL and US-Based Abra Become the Latest Crypto Firms to Announce Layoffs

Abra, a California-based crypto trading and lending platform, and OSL, a licensed crypto exchange based in Hong Kong, are the latest in a string of crypto start-ups that have announced layoffs following the ongoing market turbulence.

Abra laid off 12 of its employees this week, and two sources familiar with the knowledge disclosed the matter.

Bill Barhydt, Abra CEO, confirmed the job cuts, stating that the company has cut 12 jobs purely as part of its cost-saving measures. The executive stated that layoffs translated to 5% of the workforce.

Barhydt said although Abra has trimmed certain jobs, the firm is still planning to hire more talents to fill various roles. While he did not mention specific job functions, he stated that an estimated 10 positions are currently open.

Meanwhile, Hong Kong-based digital asset trading platform, OSL, has slashed between 40 and 60 jobs, which is about 15% of its workforce, two individuals familiar with the source disclosed the development. The crypto exchange announced the job cuts on Wednesdays.

An OSL spokesperson confirmed the incident and said: “OSL has made the difficult decision to reduce headcount. This decision was not made lightly, and we understand the impact that this may have on employees.”

The OSL spokesperson further said the firm has adjusted its business model to renew its focus on SaaS and professional and institutional counterparts.

The spokesperson clarified that OSL made the layoffs not because it had any exposure to troubled crypto firms or tokens, including TerraUSD (UST) and staked ether (stETH).

“It is important to note that OSL has not had any exposure to stETH, luna or UST. Nor have we had exposure to any of the firms reportedly facing solvency issues,” the spokesperson said.

Abra and OSL have therefore joined several crypto firms that recently announced massive layoffs. Many crypto companies have laid off thousands of employees and frozen hiring amid challenging times for crypto and equity markets.

Last month saw more than 1,700 crypto job cuts in the crypto industry. Major crypto companies such as Gemini, Coinbase, Crypto.com, BlockFi, Mexico-based Bitso, Argentina’s Buenbit, and others, trimmed their workforces in June.

Former CTO of Square and Creator of Cash App Dies in San Francisco Stabbing

Bob Lee, the former chief technology officer of Square and creator of Cash App, died on April 4, 2023, following a stabbing in San Francisco. Lee was a prominent figure in the tech industry, having contributed significantly to the development of Square and Cash App, two popular payment processing platforms. Lee’s death has come as a shock to the tech community, with many expressing their condolences on social media.

Bill Barhydt, the CEO of Abra, a leading crypto wallet company, confirmed Lee’s death on Twitter on April 5. Barhydt shared a report from a local media outlet that reported on Lee’s death but did not name him. However, Barhydt confirmed that it was indeed Bob Lee who had passed away. Barhydt expressed his grief and described Lee as a “brilliant mind” who had made significant contributions to the tech industry.

Jack Dorsey, the co-founder and CEO of Twitter, also expressed his condolences on the decentralized social media platform Nostr. Dorsey confirmed the news of Lee’s death and described it as “heartbreaking.” Many in the tech community have expressed their shock and sadness at the news of Lee’s untimely passing.

Lee’s contributions to the tech industry are significant, having played a pivotal role in the development of Square and Cash App. Square is a payment processing platform that allows small businesses to accept credit card payments. Cash App, on the other hand, is a mobile payment service that allows users to send and receive money. Lee was the chief technology officer of Square from 2009 to 2013 and is credited with playing a significant role in the company’s success.

Lee’s death has raised concerns about the safety of tech workers in San Francisco. The city has been grappling with rising crime rates, including a spate of violent incidents in recent months. Lee’s death is a tragic reminder of the need for increased security measures to protect the tech community.

In conclusion, Bob Lee’s passing is a significant loss to the tech industry. He was a talented and innovative individual who made significant contributions to the development of Square and Cash App. His untimely death is a reminder of the need for increased security measures to protect tech workers in San Francisco and other cities. The tech community will undoubtedly mourn his passing and remember his legacy.

Texas Securities Board Issues Emergency Cease and Desist Order to Abra and CEO, William Barhydt

The Texas State Securities Board has taken decisive action against Abra by issuing an Emergency Cease and Desist Order. The order, also directed at Abra’s CEO, William (Bill) Barhydt, alleges securities fraud and misleading statements in connection with Abra’s digital asset depository accounts. This development comes as part of an ongoing investigation conducted by a working group of state securities regulators.

Abra, operating under various entities, including Plutus Financial, Inc. dba Abra, Plutus Lending, LLC dba Abra, and Abra Boost, LLC, is accused of selling investments in Abra Earn, a digital asset depository account, to both accredited and unaccredited investors across the United States. The Enforcement Division of the Texas State Securities Board has presented evidence suggesting fraudulent activities by Abra and its affiliates.

Under the Emergency Cease and Desist Order, Abra and its subsidiaries are required to halt their alleged fraudulent practices immediately. The order highlights Abra’s principal addresses in Delaware and California, signaling the board’s intention to ensure compliance across state lines.

The allegations made by the Texas State Securities Board raise concerns about the integrity of Abra’s investment offerings. The working group of state securities regulators leading the investigation believes that Abra made materially misleading statements and engaged in securities fraud, potentially deceiving investors. The board’s action aims to protect the public and prevent further harm.

Furthermore, the order emphasizes the financial instability of Abra, suggesting that the company is either insolvent or on the verge of insolvency. This revelation adds urgency to the case, prompting the Texas State Securities Board to take immediate action.

Abra’s CEO, William (Bill) Barhydt, is also a subject of the investigation. The board has served Barhydt with the Emergency Cease and Desist Order at various addresses, including Abra’s principal locations and Barhydt’s personal address in California.

The Securities Commissioner has requested a hearing on the matter, and the State Office of Administrative Hearings will consider the evidence presented by the Enforcement Division. The proposed relief includes cease and desist orders, refunds of principal to investors, and administrative fines against Abra, its subsidiaries, and Barhydt.

It is important to note that the Emergency Cease and Desist Order does not prevent Abra and its entities from returning assets to investors. The board’s primary concern is the protection of investors and ensuring fair treatment for those who have invested in Abra’s Earn and Boost accounts.