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Over 75% of Bitcoin Short-Term Holders in Profit as BTC Breaches $67K Resistance

by dave July 27, 2024

written by dave 7 minutes read

Bitcoin Price Sees Relief but Faces Resistance

Bitcoin’s price is finally seeing some relief, as it recently climbed above $67,000. However, it faces significant resistance at the $68,000 mark. This resistance is crucial because breaking through it could trigger over $700 million worth of short liquidations. This means that many people who bet against Bitcoin’s price rising would have to buy Bitcoin to cover their losses, potentially pushing the price even higher.

Bitcoin Short-Term Holders in Profit

Three-quarters of short-term Bitcoin holders are now in profit. This could give Bitcoin’s price more upward momentum. This increase in profit is due to Bitcoin’s recent rally. According to a report by Glassnode on July 24, “This rally has now broken back above the STH cost basis and returned 75% of their held supply to an unrealized profit.” The STH-MVRV metric shows this recovery, which has now risen above the break-even level of 1.0.

The Impact of Bitcoin’s Price Rally

Bitcoin’s price rally offers significant relief for short-term holders. This group saw over 90% of its supply in the red during late July. Short-term holders are often used as a measure to gauge Bitcoin demand and recent buying patterns. Their profitability can be a strong indicator of market sentiment.

Key Support and Resistance Levels

Bitcoin’s price managed to settle above a key support level, despite a $3.9 billion BTC futures expiry that threatened to drop it to $63,000. Following the rally, Bitcoin needs to stay above the $65,000 mark, which acts as a key support. Popular crypto analyst Rekt Capital noted in a July 26 post, “The retest was successful. Bitcoin has confirmed $65,000 as support. Price will now continue to occupy the $65000-$71500 region (red).”

Resistance at $68,000

Despite the bullish price recovery, Bitcoin faces significant resistance at the $68,000 mark. Nearly $700 million worth of leveraged short positions are at risk of liquidation if Bitcoin rises above this level, according to CoinGlass data. Short liquidations would exceed $1 billion if Bitcoin surpasses $68,500, but reaching that level depends on inflows from US spot Bitcoin exchange-traded funds (ETFs).

US Spot Bitcoin ETFs and Their Impact

Inflows into US spot Bitcoin ETFs have been slowing down since July 23. By July 25, these inflows reached $31.1 million, according to Farside Investors data. The pace of these inflows can significantly impact Bitcoin’s price movement.

Bitcoin Futures Expiry and Its Effects

Bitcoin futures expiry is a major event that can influence the price. The recent $3.9 billion BTC futures expiry threatened to push Bitcoin down to $63,000. However, Bitcoin managed to hold its ground and even rally. Futures expiry events are important to watch as they can create volatility in the market.

Glassnode Report on Bitcoin’s Recent Rally

The Glassnode report from July 24 highlights the importance of the recent Bitcoin rally. The report states, “This rally has now broken back above the STH cost basis and returned 75% of their held supply to an unrealized profit.” This shows that short-term holders are now seeing profits, which can boost market confidence and encourage more buying.

Bitcoin Short-Term Holders’ Profitability

The profitability of short-term Bitcoin holders is a key metric to watch. When a large percentage of these holders are in profit, it suggests strong demand and positive market sentiment. This can lead to further price increases as more investors gain confidence in Bitcoin’s upward potential.

Key Support Level at $65,000

Bitcoin needs to maintain its position above the $65,000 support level to continue its upward trend. This level has been confirmed as support by crypto analyst Rekt Capital, who stated, “The retest was successful. Bitcoin has confirmed $65,000 as support.” Staying above this level is crucial for Bitcoin to reach higher price targets.

The Role of Leveraged Short Positions

Leveraged short positions are bets that Bitcoin’s price will fall. If Bitcoin’s price rises, these positions can be forced to liquidate, which means buying Bitcoin to cover losses. This buying pressure can drive the price up even further. Currently, nearly $700 million worth of these positions could be liquidated if Bitcoin breaks above $68,000.

Psychological Resistance at $68,000

The $68,000 mark is a psychological resistance level for Bitcoin. Breaking through this level could lead to significant price movements. Many investors watch these key levels closely, and breaking through can lead to increased buying activity.

Short Liquidations and Their Impact

If Bitcoin’s price rises above $68,000, it could trigger nearly $700 million in short liquidations. If the price goes above $68,500, these liquidations could exceed $1 billion. This would create substantial buying pressure, potentially driving the price even higher.

Bitcoin Demand and Buying Patterns

Short-term holders are often used to gauge Bitcoin demand and recent buying patterns. Their profitability can indicate strong market demand. When short-term holders are in profit, it suggests that recent buyers are willing to hold their positions, expecting further price increases.

Bitcoin’s Price Recovery

Bitcoin’s recent price recovery is a positive sign for the market. It shows that despite threats like futures expiries and resistance levels, Bitcoin can still find support and rally. This recovery boosts investor confidence and can attract more buyers to the market.

Key Metrics to Watch

Several key metrics are important to watch in the Bitcoin market. These include the STH-MVRV metric, which shows short-term holders’ profitability, and the levels of leveraged short positions. Watching these metrics can provide insights into market trends and potential price movements.

Bitcoin’s Price Movement and Future Outlook

Bitcoin’s price movement depends on several factors, including support and resistance levels, futures expiries, and inflows into US spot Bitcoin ETFs. Staying above key support levels like $65,000 is crucial for maintaining upward momentum. Breaking through resistance at $68,000 could trigger significant buying activity and further price increases.

Conclusion

Bitcoin’s recent price rally has brought significant relief to short-term holders, with over 75% now in profit. However, the price faces resistance at the $68,000 mark, which is crucial for future movements. Key support levels, futures expiries, and inflows into US spot Bitcoin ETFs are all factors to watch. The profitability of short-term holders and the potential for short liquidations are important metrics that can influence Bitcoin’s price in the near future. By keeping an eye on these factors, investors can better understand market trends and make informed decisions.

Bitcoin

BTC Outperforms Crypto Market, Ether Price Drops Amid ETF Launch

by muhammed July 26, 2024

written by muhammed 5 minutes read

BTC Outperforms Broader Crypto Market

Introduction

Bitcoin (BTC) outperformed the wider crypto market as measured by the CoinDesk 20 Index during the Friday Asia trading session. The performance of Ether (ETH) exchange-traded funds (ETFs) mirrors that of the Bitcoin ETFs after their launch in January.

Bitcoin’s Strong Performance

During the Asia trading day, Bitcoin added 4.4% to test $67,000, while the CoinDesk 20 Index (CD20) rose 3.3%. Solana’s SOL jumped over 5% to lead gains among major tokens, with Ether (ETH), BNB Chain’s BNB, and Cardano’s ADA adding 3%. Dogecoin (DOGE) rose 4%, and Solana-based memecoin popcat (POPCAT) jumped more than 8% to lead gains in that category.

Ether and Crypto Futures

For the third day, Ether products led liquidations across crypto futures, with over $70 million in longs liquidated compared with $55 million on BTC-tracked futures. Open interest, or the number of unsettled futures bets, dropped by $1 billion over the past 24 hours, indicating money leaving the market.

Bitcoin Outflows

Bitcoin exchange-traded funds (ETFs) added a net $31.16 million, bringing the cumulative net flow since their introduction in January to just under $17.5 billion. Total net assets of the ETFs amount to $59.14 billion, or about 4.6% of the entire market cap of the largest cryptocurrency.

Ether ETF Performance

Ether, the second-largest cryptocurrency, rose 2.8% to top $3,200. The Ether ETFs experienced a net daily outflow of $152 million. The current cumulative flow for the ETFs since they started trading this week is negative $178.68 million, mainly due to withdrawals from Grayscale Ethereum Trust (ETHE), which converted to an ETF.

Comparison with Bitcoin ETFs

CoinShares analysts noted that this situation is very similar to the Bitcoin ETF product launches at the beginning of the year. Outflows from the Grayscale Bitcoin Trust (GBTC), the world’s largest Bitcoin fund at the time, which converted from a closed-end structure into an ETF, weighed on Bitcoin’s price over the first weeks. Later, inflows to rival funds overcame the negative trend, propelling BTC to an all-time high in March.

Grayscale Ethereum Trust

The Grayscale Ethereum Trust is following the same path but faster, making the decline a “prime buying opportunity,” according to Mads Eberhardt, a crypto analyst at Steno Research. If this trend continues, the outflow from the Grayscale Ethereum ETF could end much quicker than it did for Bitcoin in January, perhaps as early as mid-next week. After this, strong net inflow is expected due to the inflow into other ETFs observed over the last few days.

Different Opinions on Ether’s Future

Rachel Lin, CEO and co-founder of SynFutures, disagreed, saying she expects short-term pain for ETH traders. She noted that Grayscale’s ETH ETF fund is becoming a net seller on the market, with over $810 million in outflow since the ETF launch. Grayscale currently holds over $8 billion worth of Ether, and nearly 10% of it was sold in just the past two days. If the trend continues, Grayscale might reach the 50% mark far sooner than with Bitcoin. However, that would also mean more downside for Ethereum.

Solana and Other Major Tokens

While Bitcoin and Ether faced mixed performances, Solana’s SOL saw significant gains, jumping over 5%. This made SOL the leading gainer among major tokens. Other cryptocurrencies like BNB Chain’s BNB, Cardano’s ADA, and Dogecoin (DOGE) also saw positive movements, adding around 3% to their values. In the memecoin category, popcat (POPCAT) from the Solana network stood out with an 8% jump.

Market Reactions and Predictions

Analysts have varying opinions on the market’s direction. While some see the current situation as a buying opportunity, others predict more short-term pain. The market is reacting to the launch and performance of ETFs, with significant inflows and outflows affecting prices. The comparison between Bitcoin and Ether ETFs highlights how similar market events can lead to different outcomes based on the timing and speed of investor reactions.

Long-Term Outlook

The long-term outlook for both Bitcoin and Ether remains positive, according to some analysts. Despite the short-term volatility, the introduction of ETFs and the resulting market dynamics are seen as steps toward greater acceptance and integration of cryptocurrencies into mainstream financial systems. The cumulative net flows, despite some negative periods, suggest a growing interest and investment in these digital assets.

Conclusion

Bitcoin’s recent performance has shown its ability to outperform the broader crypto market, even amid significant market events like ETF launches. Ether, while facing challenges, mirrors Bitcoin’s previous ETF journey and may soon see a reversal in outflows. The crypto market remains dynamic, with various factors influencing the prices and performance of different tokens. As always, investors should stay informed and cautious, keeping an eye on both short-term trends and long-term potentials.

News

EU Plans Comprehensive Asset Register by 2025: Privacy Concerns Rise

by Tatjana July 26, 2024

written by Tatjana 8 minutes read

EU Plans Comprehensive Asset Register from 2025: Massive Intrusions into Citizens’ Privacy

The European Union is planning to introduce an asset register that could start in 2025. This register is officially meant to combat money laundering and terrorist financing. However, critics say it could lead to massive intrusions into citizens’ privacy, making everyone more transparent to the authorities.

A Comprehensive Control and Monitoring System

Since 2021, the EU has been working on plans to centrally record assets and their owners. Now, it seems these plans are closer to becoming real. Under the pretext of fighting money laundering and terrorist financing, a control and monitoring system is being set up that is unparalleled. This system will make all financial transactions and assets of citizens accessible to authorities.

The register will record all assets over 200,000 euros. These include real estate, bank accounts, securities, foreign assets, crypto assets, vehicles, and possibly also works of art or precious metals. Critics fear that the limit of 200,000 euros could be lowered to include even more citizens and their private financial information.

Access for Authorities and “Persons with Legitimate Interests”

Not only will authorities have access to the asset register, but also “persons with legitimate interests.” This includes journalists, reporters, other media, civil society organizations, and higher education institutions. Critics believe this is a significant invasion of citizens’ privacy and could lead to misuse and data leaks.

Further Monitoring Measures

In addition to capping cash transactions at 10,000 euros and the asset register, the EU has adopted more measures to combat money laundering and terrorist financing. One of these is the creation of a new Anti-Money Laundering Authority (AMLA). The AMLA will be based in Frankfurt am Main and is scheduled to start work in mid-2025. This authority will have far-reaching powers and will directly monitor up to 40 financial institutions.

Introduction of a Central Reporting System

To prevent money laundering and terrorist financing, each EU member state should set up a financial intelligence unit (FIU). These units will exchange information with each other and with the competent authorities, and cooperate with Europol, Eurojust, and the European Public Prosecutor’s Office. The AMLA will be responsible for supervising and coordinating the FIUs.

Danger of Wealth Redistribution and Expropriation

The asset register will allow for detailed recording and valuation of assets, which could be used for wealth redistribution and tax increases, such as a wealth tax. It could also play a role in the Equalization of Burdens Act, which aims to ensure fair distribution of financial burdens after major economic crises. Critics argue that the register massively interferes with citizens’ privacy.

Concerns Over Digital Central Bank Currencies and Surveillance

Anyone who previously thought that worries about the abolition of cash and the surveillance and control of people through programmable digital central bank currencies were just conspiracy theories might be proven wrong by the wealth register idea. Politics often proceeds in small steps: eventually, everyone could be affected, not just criminals or the wealthy, whose assets some might want to redistribute.

EU Commission Tries to Limit the Damage

Facing massive criticism, the EU Commission is trying to limit the damage. According to a statement by spokesman Eric Mamer, the Commission currently has “no intention of setting up a central database on the assets of EU citizens.” However, such assurances should be taken with a grain of salt. Remember the famous words: “Nobody has any intention of building a wall.”

Citizens Should Remain Vigilant

Citizens should remain vigilant and critically examine the EU’s plans. This is about protecting privacy and the freedom of the individual. With the introduction of the asset register, citizens’ financial data could be easily accessed by authorities and other parties with “legitimate interests.” This could lead to a significant invasion of privacy and potential misuse of data.

Potential Implications of the Asset Register

The introduction of the asset register has several potential implications. First, it could make citizens more transparent to the authorities. This means that all financial transactions and assets over 200,000 euros will be accessible to the authorities. This could include real estate, bank accounts, securities, foreign assets, crypto assets, vehicles, works of art, and precious metals.

Second, the register could be used for wealth redistribution and tax increases, such as a wealth tax. This means that the detailed recording and valuation of assets could lead to higher taxes for citizens. It could also be relevant for the Equalization of Burdens Act, which aims to ensure fair distribution of financial burdens after major economic crises.

Third, the register could lead to further monitoring measures. In addition to capping cash transactions at 10,000 euros, the EU has adopted more measures to combat money laundering and terrorist financing. This includes the creation of the Anti-Money Laundering Authority (AMLA) and financial intelligence units (FIUs) in each member state. The AMLA will have far-reaching powers and will directly monitor up to 40 financial institutions.

Privacy Risks and Data Security Concerns

One of the biggest concerns about the asset register is the potential invasion of citizens’ privacy. Critics argue that making financial transactions and assets accessible to authorities and other parties with “legitimate interests” could lead to misuse and data leaks. This could result in significant invasions of privacy and potential harm to citizens.

Another concern is data security. With the asset register containing sensitive financial information, there is a risk of data breaches and cyber attacks. This could lead to the exposure of citizens’ financial data, causing harm and financial loss.

Impact on Financial Institutions and Markets

The introduction of the asset register could also have an impact on financial institutions and markets. Financial institutions will be subject to more scrutiny and monitoring, which could lead to increased compliance costs. This could also affect their operations and profitability.

In addition, the asset register could impact financial markets. The detailed recording and valuation of assets could lead to changes in asset prices and market behavior. This could affect investors and market participants.

Criticism and Opposition to the Asset Register

There has been significant criticism and opposition to the asset register. Critics argue that it is an invasion of privacy and could lead to misuse of data. They also argue that the register could be used for wealth redistribution and tax increases, which could harm citizens financially.

Opponents of the asset register also argue that it is unnecessary and could be replaced with other measures to combat money laundering and terrorist financing. They believe that the existing measures, such as the Anti-Money Laundering Authority (AMLA) and financial intelligence units (FIUs), are sufficient to address these issues.

Conclusion

The EU’s plan to introduce a comprehensive asset register from 2025 has sparked significant debate and concern. While it is officially intended to combat money laundering and terrorist financing, critics argue that it could lead to massive intrusions into citizens’ privacy and be used for wealth redistribution and tax increases. Citizens should remain vigilant and critically examine the EU’s plans to protect their privacy and freedom. The potential implications of the asset register, including privacy risks, data security concerns, and impacts on financial institutions and markets, need to be carefully considered.

Bitcoin

Franklin Templeton and SBI Holdings Partner to Launch Bitcoin ETFs in Japan

by mei July 26, 2024

written by mei 6 minutes read

Introduction

Franklin Templeton and SBI Holdings are teaming up to bring bitcoin ETFs to Japan. This new joint venture is preparing for Japan’s approval of cryptocurrency funds. The partnership aims to establish a digital asset management company. The goal is to be ready as soon as Japan gives the green light for cryptocurrency exchange-traded funds (ETFs).

Partnership Details

SBI Holdings, a Japanese financial services group, will partner with Franklin Templeton, a U.S. investment firm. SBI will hold a 51% stake in the new company, while Franklin Templeton will own the rest. Franklin Templeton is the seventh-largest asset manager in the world, managing around $1.6 trillion in assets. This new company will focus on preparing for the launch of crypto ETFs in Japan.

Franklin Templeton’s Move into Digital Assets

Franklin Templeton has traditionally focused on assets like stocks and bonds. However, in recent years, they have started investing in digital assets. They were one of the first to launch spot bitcoin ETFs after approval from the U.S. Securities and Exchange Commission in January. These spot bitcoin ETFs have seen total inflows exceeding $16 billion in just six months, according to market researcher EPFR.

Global Approval of Bitcoin ETFs

Bitcoin ETFs have already been approved for trading in the U.S., Canada, Brazil, Hong Kong, and Australia. While Japan hasn’t approved them yet, the new company by Franklin Templeton and SBI will be ready once approval is granted. This shows the growing acceptance of bitcoin ETFs worldwide.

Benefits for Retail Investors

Bitcoin ETFs can be traded through regular securities accounts. This means retail investors don’t need to use specialized crypto exchanges. They also don’t need to manage complex password-like private keys. This makes trading bitcoin ETFs much easier for everyday investors.

Ethereum ETF Trading

In addition to bitcoin ETFs, there are also Ethereum ETFs. Trading of an Ethereum ETF began in the U.S. recently. This is another step in the growing market of cryptocurrency ETFs.

Digital Asset Securities

The new joint venture will not only focus on bitcoin ETFs but also on digital asset securities. Franklin Templeton has been an early mover in this area. Digital asset securities involve tokenization. Tokenization uses blockchain to create tradable ownership tokens of assets like real estate and government bonds. According to a forecast by Boston Consulting Group and ADDX, asset tokenization is expected to grow to $16.1 trillion by 2030.

SBI Holdings’ Expansion into Alternative Assets

SBI Holdings has been partnering with overseas companies to expand its offerings in alternative asset investment products. For example, they established companies with U.K.-based Man Group in July 2023 and with U.S. private equity firm KKR in September 2023. These alternative assets have a low correlation with traditional assets like stocks and bonds, making them attractive for investors looking to diversify their portfolios.

SBI Securities’ Wealth Management Office

SBI Securities, Japan’s largest online brokerage, set up a wealth management office in July 2023. This move aims to expand their customer base upmarket, providing more options for wealthy clients. This shows SBI’s commitment to growing its presence in the financial market.

Preparing for Japan’s Approval

The new joint venture between Franklin Templeton and SBI Holdings is strategically positioned to launch bitcoin ETFs as soon as Japan’s Financial Services Agency (FSA) gives its approval. This proactive approach shows the company’s commitment to being at the forefront of the cryptocurrency market in Japan.

The Future of Digital Asset Management

With Franklin Templeton’s expertise in asset management and SBI’s strong presence in Japan, the new company is well-equipped to handle the complexities of digital asset management. They are preparing to meet the growing demand for cryptocurrency funds and digital asset securities.

Summary of Key Points

Franklin Templeton and SBI Holdings are teaming up to bring bitcoin ETFs to Japan.
SBI Holdings will hold a 51% stake in the new company.
Franklin Templeton is the seventh-largest asset manager globally.
They have moved into digital assets and were early movers in spot bitcoin ETFs.
Bitcoin ETFs have seen significant inflows globally.
The new company will also focus on digital asset securities and tokenization.
SBI Holdings is expanding into alternative asset investments.
SBI Securities set up a wealth management office to attract wealthy clients.
The joint venture is preparing for Japan’s Financial Services Agency approval.

Conclusion

Franklin Templeton and SBI Holdings’ partnership marks a significant step in bringing bitcoin ETFs to Japan. This move reflects the growing global acceptance of cryptocurrency funds and digital assets. With the combined expertise of both companies, they are well-prepared to meet the demand for these innovative investment products. As Japan moves closer to approving cryptocurrency ETFs, this new joint venture is poised to play a crucial role in the future of digital asset management.

Bitcoin

Blackrock Sees Limited Interest in Crypto ETFs Beyond Bitcoin and Ethereum

by mei July 26, 2024

written by mei 5 minutes read

Blackrock’s View on Crypto ETFs Beyond Bitcoin and Ethereum

Blackrock, a major asset manager, believes there is “very little interest” in cryptocurrencies beyond Bitcoin (BTC) and Ethereum (ETH). Robert Mitchnick, Blackrock’s head of digital assets, shared this insight at the Bitcoin2024 conference on July 25 in Nashville, Tennessee.

Limited Interest in Crypto ETFs Beyond BTC and ETH

Robert Mitchnick emphasized that most of Blackrock’s clients are primarily interested in Bitcoin, with some interest in Ethereum. He stated, “Our client base today is overwhelmingly interested in Bitcoin first, and then somewhat in ETH. There’s very little interest today beyond those two.” He spoke during a panel titled “From Strategy to Innovation: Blackrock’s Bitcoin Journey.”

Mitchnick doesn’t foresee a wide range of crypto exchange-traded funds (ETFs) being developed beyond Bitcoin and Ethereum. Blackrock launched its first crypto ETFs, iShares Bitcoin Trust (IBIT) and iShares Ethereum Trust ETF (ETHA), in January and July, respectively.

Differing Opinions Among Asset Managers

Not all asset managers share Blackrock’s cautious view. Franklin Templeton, another asset manager that also issues BTC and ETH ETFs, is optimistic about the future of cryptocurrency ETFs, including plans for a Solana product. In a post on X (formerly Twitter) on July 23, Franklin Templeton expressed, “Besides Bitcoin and Ethereum, there are other exciting and major developments that we believe will drive the crypto space forward.”

Complementary Roles of BTC and ETH

Mitchnick explained that most of Blackrock’s clients view Bitcoin and Ethereum as complementary assets in their crypto portfolios, not as competitors. “When clients buy ETH ETFs, they usually add to an existing crypto portfolio allocation, rather than swap out of BTC,” he said. However, he noted that data on investor flows into ETH ETFs, which only started trading on July 23, is limited.

Bitcoin is often seen as a “store of value” within the crypto space, a role it holds quite definitively. On the other hand, Ethereum is involved in various applications that Bitcoin does not typically engage in. “ETH is trying to do a bunch of different applications that for the most part, Bitcoin is not trying to do,” Mitchnick said. “So, really, they’re more complements than they are competitors or substitutes.”

Mitchnick expects that eventually, investors will allocate around 20% of their crypto holdings to Ethereum, with the remainder going to Bitcoin.

Popularity of Blackrock’s Crypto ETFs

Blackrock’s crypto ETFs are among the most popular in the industry. The iShares Bitcoin Trust (IBIT) commands approximately $22 billion in assets under management (AUM), while the iShares Ethereum Trust ETF (ETHA) has approached $270 million after only a few days of trading.

Blackrock’s Strategic Insights

Mitchnick’s insights reflect Blackrock’s strategic approach to the crypto market. By focusing on Bitcoin and Ethereum, Blackrock aims to meet the primary interests of its clients. This strategy seems to be paying off, given the substantial AUM figures for their crypto ETFs.

Franklin Templeton’s Different Approach

In contrast, Franklin Templeton’s approach indicates a broader interest in the crypto market. Their optimism about future cryptocurrency ETFs, including products beyond Bitcoin and Ethereum, suggests a belief in the potential for other digital assets to play significant roles in the market.

Future of Crypto ETFs

The future of crypto ETFs remains a topic of interest and debate among asset managers. While Blackrock remains cautious and focused on Bitcoin and Ethereum, other firms like Franklin Templeton are exploring a wider range of cryptocurrency products. This divergence in strategies highlights the evolving nature of the crypto market and the differing opinions on what will drive its growth.

Key Takeaways

Client Interest: Blackrock’s clients are primarily interested in Bitcoin and Ethereum, with little interest in other cryptocurrencies.
Complementary Assets: BTC and ETH are seen as complementary, not competing, assets in crypto portfolios.
Strategic Focus: Blackrock focuses on BTC and ETH to align with client interests and achieve substantial AUM.
Diverse Strategies: Other asset managers, like Franklin Templeton, are more optimistic about a broader range of cryptocurrency ETFs.
Market Dynamics: The future of crypto ETFs will be shaped by differing strategies and evolving client interests.

Conclusion

Blackrock’s cautious approach to crypto ETFs, focusing on Bitcoin and Ethereum, contrasts with the more expansive strategies of other asset managers like Franklin Templeton. As the crypto market continues to evolve, these differing perspectives will play a crucial role in shaping the landscape of cryptocurrency investment products. The popularity of Blackrock’s ETFs highlights the strong client interest in BTC and ETH, while the optimism of firms like Franklin Templeton suggests that there may be more room for growth and innovation in the cryptocurrency ETF space.

Ethereum

Grayscale Ethereum ETF Faces Over $1 Billion in Outflows: A Performance Comparison

by Tatjana July 26, 2024

written by Tatjana 4 minutes read

Grayscale Ethereum ETF Sees Major Outflows

Introduction

Grayscale’s Ethereum ETF has faced significant challenges since its launch. On Thursday, the ETF experienced over $1 billion in outflows. This article will explore the details of these outflows, compare Grayscale’s performance to other Ethereum funds, and discuss investor reactions and future implications.

Outflows on Thursday

Grayscale’s Ethereum ETF (ETHE) had a tough third day of trading. Data from Farside Investors showed that ETHE had $346 million in net outflows on Thursday. This extended its total losses to $1.1 billion since its debut. The ETF’s assets under management fell dramatically from over $9 billion to $7.4 billion in just three days.

Comparison with Other Ethereum ETFs

While Grayscale’s Ethereum ETF struggled, other Ethereum funds performed better. BlackRock’s iShares Ethereum Trust (ETHA) led the pack with $71 million in net inflows on Thursday. Grayscale’s Ethereum Mini Trust (ETH), a spinoff from their main Ethereum Trust, also did well with over $58 million in net inflows.

Other notable funds like Fidelity’s Ethereum Fund (FETH), Bitwise’s Ethereum ETF (ETHW), VanEck’s Ethereum ETF (ETHV), and Invesco/Galaxy’s Ethereum ETF (QETH) also reported positive inflows. However, the combined net outflow for all nine funds on Wednesday reached $152 million. This was the largest outflow since their trading debut on July 23, driven mainly by Grayscale’s ETHE.

High Fees Affecting Investor Decisions

One reason for the significant outflows from Grayscale’s Ethereum ETF is its high fee. With a 2.5% fee, it is one of the most expensive options for investors looking to gain exposure to Ethereum. Many investors have been selling their ETHE shares and moving to lower-fee alternatives.

The Experience of Grayscale’s Bitcoin ETF

Grayscale’s current struggles with their Ethereum ETF are not entirely unexpected. The company had a similar experience with their Bitcoin ETF (GBTC). During its first month of trading, the Bitcoin ETF saw outflows topping $5 billion, according to data from Bloomberg. This history suggests that investors might be wary of Grayscale’s high-fee structure.

The Success of Grayscale’s Ethereum Mini Trust

In contrast to the main Ethereum ETF, Grayscale’s Ethereum Mini Trust (ETH) has been successful. The Mini Trust’s lower fee of 0.15% makes it an attractive option for investors. Since its conversion into an ETF, the fund’s inflows have consistently grown. This suggests that investors are looking for cost-effective ways to invest in Ethereum.

Investor Behavior and Market Reactions

The significant outflows from Grayscale’s Ethereum ETF reflect a broader trend in investor behavior. High fees are a deterrent, and investors are seeking cheaper alternatives. This behavior was also seen with the other Ethereum funds. For example, despite overall inflows to eight Ethereum ETFs, the combined net outflow for all nine funds reached $152 million on Wednesday. This shows that while there is interest in Ethereum ETFs, high fees can drive investors away.

The Future of Ethereum ETFs

The performance of Grayscale’s Ethereum ETF raises questions about the future of Ethereum ETFs in general. The high fees associated with some funds may push investors towards more affordable options. Grayscale’s experience with their Bitcoin ETF also suggests that initial enthusiasm may be followed by significant outflows if the costs are too high.

Conclusion

Grayscale’s Ethereum ETF has had a challenging start, with over $1 billion in outflows within three days. In contrast, other Ethereum funds like BlackRock’s iShares Ethereum Trust and Grayscale’s Ethereum Mini Trust have seen positive inflows. High fees are a significant factor driving investor decisions, as seen with the outflows from Grayscale’s main Ethereum ETF. As the market for Ethereum ETFs evolves, investors will likely continue to seek cost-effective options for their investments.

Ethereum

Ethereum Whale Accumulation Continues: Is ETH Price Recovery on the Horizon?

by Tatjana July 25, 2024

written by Tatjana 5 minutes read

Ethereum Whale Accumulation Continues Despite Selling Pressure: ETH Price Recovery Soon?

While spot Ethereum ETFs saw a successful launch with more than $107 million in inflows on Tuesday, ETH prices have been under selling pressure, down 1.1% at press time and close to $3,450 levels.

Ethereum ETFs and Selling Pressure

Ethereum’s spot ETFs launched successfully, bringing in over $107 million in inflows. Despite this, ETH prices have been dropping, currently down by 1.1%, hovering around $3,450. However, on-chain indicators suggest that Ethereum whale activity remains strong, hinting that the downside could be limited.

On-Chain Indicators and Whale Activity

On-chain data from IntoTheBlock shows that large holders amassed 112.9k ETH, worth a staggering $390 million, despite the ETF price decline yesterday. This accumulation far exceeds the $106 million net inflows to Ethereum ETFs. This shows strong demand for Ethereum among big market players right now.

Similarly, on-chain data analytics platform Santiment reported that the introduction of the spot Ethereum ETFs has significantly influenced whale activity over the past week. Since July 17th, the number of ETH transfers exceeding $100K in value has increased by 64% compared to BTC transfers and by 126% compared to USDT (on ETH) transfers.

Ethereum Price Action Going Ahead

Reportedly, Ethereum is following the same trajectory that Bitcoin did after the approval of the spot BTC ETFs earlier this year. The Bitcoin price surge started in February as investors managed to settle through the Grayscale outflows and BlackRock inflows. Popular crypto analyst Michael van de Poppe wrote:

“If the markets copy the price action of the Bitcoin ETF, then it’s likely we’ll have a slight sell-off due to the outflows of the Grayscale trust. One or two weeks of downward momentum before the real surge of Ethereum towards a new all-time high.”

As per the chart shared by Poppe, Ethereum might see a reversal to $3,150 levels before resuming the upward journey. It will be interesting to see how long the Ethereum ETF inflows continue, thereby instilling confidence among investors.

Ethereum Spot ETF Hype and Whale Activity

According to data from the on-chain analytics firm Santiment, Ethereum whales have been displaying considerable activity recently. The indicator of relevance here is the “Whale Transaction Count,” which tracks the total amount of transfers on any given network valued at least $100,000.

When the metric’s value is high, the blockchain observes many large transactions. Such a trend implies the whales have an active interest in trading the asset. On the other hand, a low indicator suggests the whales may not be paying much attention to the cryptocurrency as they aren’t making that many transfers.

Whale Transaction Count Analysis

Here is a chart that shows the trend in the Whale Transaction Count for the top three coins in the sector, Bitcoin (BTC), Ethereum (ETH), and Tether (USDT), since the start of the year:

As seen, the Whale Transaction Count for Ethereum has been the highest among these three assets recently. More specifically, ETH has seen 77,200 whale transactions since the 17th of this month, notably higher than BTC’s 47,000 or USDT’s 34,100.

Impact of Spot ETFs on Ethereum Whale Activity

The sharp spike in activity for Ethereum is likely due to the hype around the spot ETFs, which, after much anticipation, have finally been launched following approval by the US Securities and Exchange Commission (SEC). The Whale Transaction Count suggests whales had started repositioning themselves before this launch. It’s hard to say what type of activity these large holders were participating in based on this indicator alone.

Given that the event was considered bullish, it would make sense if the whales were buying. Data from the market intelligence platform IntoTheBlock has confirmed that large holders have recently increased their supply.

Ethereum Large Holders Netflow

IntoTheBlock defines “large holders” as investors who own at least 0.1% of the entire Ethereum supply in circulation. From the chart, it’s apparent that the net flow into the wallets of this cohort has remained positive over the past week, coinciding with the period that the whales have been active.

Yesterday alone, Ethereum large holders bought 112,900 ETH, equivalent to around $391 million at the current exchange rate. This accumulation notably surpasses the $106 million net inflows to the ETF, notes the analytics firm.

Conclusion

The continuous accumulation of Ethereum by whales despite selling pressure indicates a strong demand among large investors. With the successful launch of Ethereum ETFs and a significant increase in whale activity, the future of ETH prices seems promising. The analysis suggests a potential price recovery, following the patterns seen with Bitcoin after its ETF approval. Investors and traders will be watching closely to see if Ethereum can overcome the current selling pressure and move towards new highs.

Bitcoin

Marathon Digital MARA Buys $100 Million in Bitcoin, Holdings Surpass 20,000 BTC

by dave July 25, 2024

written by dave 5 minutes read

MARA Buys $100 Million in Bitcoin, Holdings Surpass 20,000 BTC

Introduction

Bitcoin miner MARA, also known as Marathon Digital, has made a significant move by purchasing $100 million worth of bitcoin. This big purchase takes MARA’s total bitcoin holdings to over 20,000 BTC. MARA plans to adopt a full “HODL” strategy, meaning they will keep all the bitcoin they mine and will continue to make additional purchases when the time is right.

MARA’s Big Bitcoin Purchase

MARA recently announced that it has bought an extra $100 million worth of bitcoin. This acquisition brings their total bitcoin holdings on the balance sheet to more than 20,000 BTC, which is valued at about $1.3 billion. This amount represents nearly 0.1% of bitcoin’s total supply of 21 million.

MARA didn’t provide specific details on when they made these purchases or the average price per bitcoin. However, Salman Khan, MARA’s CFO, mentioned that they took advantage of favorable market conditions to make these strategic purchases. Based on the dollar amount and their holdings of 18,536 BTC at the end of June, it is likely that the latest acquisitions are around 1,500 BTC, bought in the $54,000 to $68,000 price range.

Previous Bitcoin Purchases

This isn’t the first time MARA has bought bitcoin outside of its mining production. In January 2021, MARA purchased $150 million worth of bitcoin. According to Salman Khan, the majority of the bitcoin on MARA’s balance sheet has come from their mining operations.

MARA’s Full HODL Strategy

MARA has decided to fully adopt a “HODL” strategy for its bitcoin treasury policy. This means they will keep all the bitcoin they mine and make additional strategic purchases periodically. Fred Thiel, MARA’s chairman and CEO, stated that this strategy shows their confidence in the long-term value of bitcoin. He believes that bitcoin is the best treasury reserve asset in the world and supports the idea of governments and corporations holding bitcoin as a reserve asset.

Reducing Bitcoin Sales

In 2023, MARA reduced the percentage of bitcoin sold from their production from 56% to 31% in 2024. This change was highlighted in a report by Bernstein, a research and brokerage firm. Before last year, MARA used to keep all their bitcoin. Given the current positive trends for bitcoin, including increased institutional support and a better macro environment, MARA is once again focusing on growing the amount of bitcoin they hold on their balance sheet.

Leveraging Balance Sheet and Capital Markets

Following their renewed strategy, MARA plans to use the existing cash on their balance sheet and capital markets to fund their operations. This means they are leveraging their financial strength to support their HODL strategy and further investments in bitcoin.

Expanding into Altcoin Mining

Last month, MARA announced that they are expanding into altcoin mining to diversify their revenue streams, especially after the Bitcoin halving. They have started using Kaspa application-specific integrated circuit (ASIC) miners since September 2023. This move is part of their strategy to grow beyond bitcoin and tap into the potential of other cryptocurrencies.

MARA’s Confidence in Bitcoin

MARA’s recent actions reflect their strong belief in the future of bitcoin. They see bitcoin as a crucial asset and are committed to holding and growing their bitcoin reserves. By adopting a full HODL strategy, reducing the percentage of bitcoin sold, and expanding into altcoin mining, MARA is positioning itself for long-term success in the cryptocurrency market.

Encouraging Others to Hold Bitcoin

Fred Thiel encourages other entities, including governments and corporations, to hold bitcoin as a reserve asset. He believes that bitcoin’s long-term value makes it an ideal choice for treasury reserves. MARA’s strategy and actions serve as a model for other companies considering similar moves.

MARA’s Strategic Bitcoin Acquisitions

MARA’s strategy involves making strategic bitcoin purchases during favorable market conditions. This approach allows them to maximize their bitcoin holdings and take advantage of lower prices. Their recent $100 million purchase is a testament to this strategy and their commitment to growing their bitcoin reserves.

Impact of Bitcoin’s Price Decline

Bitcoin’s recent price decline has provided an opportunity for MARA to increase their holdings. The strength of their balance sheet has enabled them to make significant purchases even during market downturns. This ability to buy low and hold for the long term is a key part of their HODL strategy.

Conclusion

MARA’s recent $100 million bitcoin purchase and their full HODL strategy demonstrate their strong belief in the future of bitcoin. By holding and strategically acquiring bitcoin, reducing sales, and expanding into altcoin mining, MARA is positioning itself as a leader in the cryptocurrency market. Their actions and strategy serve as a model for others, highlighting the potential of bitcoin as a treasury reserve asset.

Memecoins

OKX to Delist Cardano, Shiba Inu, and XRP Trading Pairs: Everything You Need to Know

by dave July 25, 2024

written by dave 9 minutes read

Major Crypto Exchange Moves To Delist Cardano, Shiba Inu, And XRP Pairs

A major cryptocurrency exchange, OKX, has announced plans to delist trading pairs for several crypto tokens, including Cardano (ADA), Shiba Inu (SHIB), and XRP. This decision follows a performance check by the crypto exchange, which shows that these trading pairs aren’t meeting expectations.

OKX To Delist These Trading Pairs

OKX announced in a blog post that it will delist spot trading pairs for ADA-ETH, XRP-ETH, SHIB-BTC, ADA-BTC, and XRP-BTC, among others. Other crypto tokens like Litecoin (LTC), Polygon (MATIC), Chainlink (LINK), Dogecoin (DOGE), and Polkadot (DOT) were also caught in the mix. OKX revealed plans to delist some spot trading pairs related to these tokens as well.

The crypto exchange explained that this move is part of their regular monitoring and review of all listed trading pairs. This review process helps them maintain a robust trading environment. According to OKX, they decided to delist these trading pairs because they do not fulfill their listing criteria. However, the exchange did not specify the exact reasons for this action.

Delisting Schedule and Details

OKX has outlined the dates and times when these spot trading pairs will be delisted. The ADA-ETH spot trading pair will be delisted on July 25 between 8 and 8:30 a.m. UTC. The XRP-ETH and SHIB-BTC spot trading pairs will be delisted on July 26 between 8 and 8:30 a.m. UTC.

Furthermore, the ADA-BTC and XRP-BTC spot trading pairs will be delisted on August 1 and 2, respectively, between 8 and 8:30 a.m. UTC. OKX has advised customers to cancel their orders relating to these pairs before the delisting date. If customers fail to do so, the system will automatically cancel these orders, although the exchange noted that cancellations might take 1 to 3 working days.

Maintaining a Robust Trading Environment

OKX emphasizes that their decision to delist certain trading pairs is part of their effort to maintain a robust spot trading environment. The exchange regularly monitors and reviews all listed trading pairs to ensure they meet their criteria. This ongoing review process helps them identify and remove underperforming trading pairs.

OKX’s listing criteria are designed to ensure that only the most reliable and popular trading pairs are available on their platform. By delisting pairs that do not meet these criteria, OKX aims to provide a better trading experience for its users.

Impact on Other Crypto Tokens

In addition to delisting Cardano, Shiba Inu, and XRP trading pairs, OKX is also planning to delist trading pairs related to other crypto tokens like Litecoin (LTC), Polygon (MATIC), Chainlink (LINK), Dogecoin (DOGE), and Polkadot (DOT). This move is part of the same review process aimed at maintaining a robust trading environment.

Users of these tokens should be aware of the potential impact of these delistings. It is important to monitor OKX’s announcements and take necessary actions to manage their trading activities accordingly.

Steps to Cancel Orders

To prepare for the delisting of certain trading pairs, OKX has provided instructions for canceling orders. Customers should log in to their OKX accounts and navigate to the trading pairs that will be delisted. From there, they can cancel any open orders related to these pairs.

If customers fail to cancel their orders before the delisting date, the system will automatically cancel them. However, this process might take 1 to 3 working days, so it is best to cancel orders manually to avoid any potential delays.

OKX Launches Telegram-based Game

OKX has been busy lately, not just with delisting trading pairs but also with new initiatives. The crypto exchange has launched a Telegram-based game called ‘OKX Racer.’ This game is centered on Bitcoin’s price movement, challenging gamers to correctly guess the flagship crypto’s price action within five-second intervals.

Jason Lau, Chief Innovation Officer at OKX, highlighted the growing popularity of Telegram’s mini-app platform. He stated that it is becoming a “can’t-miss venue” for those looking to engage the crypto community. OKX aims to embrace this user-friendly approach to “cultivate communities, incentivize participation, and encourage fun.”

Engaging the Crypto Community

The launch of OKX Racer is part of OKX’s efforts to engage the crypto community in new and exciting ways. Telegram mini-apps have become popular due to their potential for token airdrops, which can be distributed later to gamers. This model is similar to Notcoin’s NOT airdrop campaign, which successfully engaged users.

Although Jason Lau did not confirm if OKX plans to incentivize gamers through airdrops, the potential for such incentives could make the game even more appealing. By offering fun and interactive ways to engage with the crypto community, OKX hopes to strengthen its presence in the industry.

Potential Token Airdrops

Token airdrops have become a popular way to engage users in the crypto community. By distributing tokens to gamers, exchanges can incentivize participation and build stronger communities. OKX’s new initiatives, including the OKX Racer game, could potentially include token airdrops to reward users.

The success of previous airdrop campaigns, like Notcoin’s NOT airdrop, shows the effectiveness of this strategy. By offering similar incentives, OKX could attract more users and increase engagement on their platform.

Why is OKX Delisting Cardano, Shiba Inu, and XRP Pairs?

The decision to delist Cardano, Shiba Inu, and XRP trading pairs is based on OKX’s regular performance checks. These checks are part of the exchange’s efforts to maintain a robust trading environment. By removing underperforming pairs, OKX aims to provide a better experience for its users.

Although the exact reasons for the delisting were not specified, it is likely that these pairs did not meet OKX’s listing criteria. This could be due to low trading volumes, poor performance, or other factors that make them less attractive to traders.

What Are the Affected Trading Pairs?

OKX’s announcement includes several trading pairs that will be delisted. These pairs include ADA-ETH, XRP-ETH, SHIB-BTC, ADA-BTC, and XRP-BTC. Other trading pairs related to Litecoin (LTC), Polygon (MATIC), Chainlink (LINK), Dogecoin (DOGE), and Polkadot (DOT) are also affected.

It is important for traders to be aware of these changes and take necessary actions to manage their trading activities. Canceling orders related to these pairs before the delisting date can help avoid potential issues.

How to Prepare for the Delisting

To prepare for the delisting of certain trading pairs, customers should cancel their orders before the specified dates. Logging in to OKX and navigating to the affected pairs is the first step. From there, customers can manually cancel their open orders.

If orders are not canceled manually, the system will automatically cancel them after the delisting date. However, this process may take 1 to 3 working days, so manual cancellation is recommended to avoid any delays.

OKX’s Vision for the Future

OKX’s recent actions, including the delisting of certain trading pairs and the launch of the OKX Racer game, reflect the exchange’s vision for the future. By regularly reviewing and updating their platform, OKX aims to maintain a robust trading environment and provide the best experience for their users.

The launch of new initiatives, like the Telegram-based game, shows OKX’s commitment to innovation and community engagement. By embracing new technologies and offering fun ways to engage with the crypto community, OKX hopes to strengthen its position in the industry.

Conclusion

OKX’s decision to delist trading pairs for Cardano, Shiba Inu, and XRP, along with other crypto tokens, is part of their effort to maintain a robust trading environment. By regularly reviewing and updating their platform, OKX aims to provide the best experience for their users.

The launch of the OKX Racer game and potential token airdrops show OKX’s commitment to innovation and community engagement. By offering new and exciting ways to engage with the crypto community, OKX hopes to strengthen its presence in the industry and attract more users.

Traders should be aware of the upcoming delistings and take necessary actions to manage their trading activities. Canceling orders related to the affected pairs before the delisting date can help avoid potential issues and ensure a smooth transition.

As OKX continues to innovate and engage with the crypto community, their efforts to maintain a robust trading environment and provide a better experience for users will likely strengthen their position in the industry.

Bitcoin

Wall Street’s ETF Engine Roars with $17 Billion Bitcoin Haul: New Crypto Funds on the Horizon

by mei July 25, 2024

written by mei 5 minutes read

Wall Street’s ETF Engine Revs Up After $17 Billion Bitcoin Haul

Introduction

Wall Street’s ETF engine is roaring again, especially after a huge $17 billion Bitcoin haul. This surge has issuers eager to introduce new crypto funds, particularly after the recent debut of Ether ETFs. The demand for Bitcoin ETFs has skyrocketed, with net inflows reaching $17.5 billion.

Rush for New Crypto Funds

Just 48 hours after US regulators approved Ether ETFs, asset managers are scrambling to release new products for the digital-asset market. ProShares recently submitted paperwork for six new funds that would either go long or short on Bitcoin or Ether. Hashdex is also looking to create a fund that includes both Bitcoin and Ether. Additionally, VanEck announced plans to launch an ETF based on Solana, the fifth-largest cryptocurrency. However, analysts predict a challenging path for such a launch.

Growth in the ETF Market

The ETF market is buzzing with activity. Despite the SEC’s cautious stance, Bitcoin ETFs are among the top funds for inflows this year, surpassing even some well-known tech funds. According to Roxanna Islam from VettaFi, ETFs are known for pushing boundaries. She expects more creative crypto ETF filings as investor interest in traditional spot-crypto ETFs grows.

New Fund Launches and Closures

The US ETF market, worth $9.4 trillion, is seeing rapid growth in new fund launches. So far this year, over 330 new funds have started trading, compared to around 500 for the entire last year. However, the market is also seeing a significant number of fund closures, with more than 100 ETFs shutting down in 2024, similar to last year.

Successful Debuts of Bitcoin and Ether ETFs

The debut of Bitcoin and Ether ETFs has been surprisingly successful. Ether ETFs, launched just a week ago, have already seen substantial inflows. Eight out of nine Ether ETFs have attracted investments, with BlackRock and Bitwise’s products each taking in more than $200 million. However, both the ETFs and Ether itself experienced a drop on Thursday, which some market experts predicted as a “sell-the-news” event.

Bitcoin ETFs’ Massive Inflows

Bitcoin ETFs have performed exceptionally well, with net inflows of $17.5 billion year to date. These ETFs have been in the making for years, and their launch signifies a more favorable US regulatory environment for digital assets. This regulatory shift is encouraging asset managers to get more creative with their products.

Inverse and Leveraged ETFs Popularity

Inverse and leveraged ETFs have gained significant popularity over the past year. These ETFs use derivatives to either boost returns or pay out the opposite of a stock or index’s return. Retail investors are particularly drawn to these ETFs for their potential to double or triple gains, despite the risk of amplified losses. Leveraged ETFs have seen around $9 billion in inflows this year, on track to surpass last year’s $10.2 billion. A leveraged Bitcoin ETF, trading under the ticker BITX, has accumulated nearly $2 billion in inflows this year, with gains of 50%.

The Road Ahead for Crypto ETFs

The introduction of new crypto ETFs, especially those based on Bitcoin and Ether, has created a buzz in the market. Asset managers are keen to explore new opportunities in the digital-asset space, despite the challenges posed by the regulatory environment. The success of these ETFs indicates strong investor interest and a potential shift in the market dynamics.

Investor Interest and Market Dynamics

The growing interest in crypto ETFs reflects a broader trend of increased investor interest in digital assets. As more traditional spot-crypto ETFs gain traction, we can expect to see a wave of new filings for crypto strategies. This trend is likely to continue as investors seek to diversify their portfolios with innovative financial products.

Conclusion

Wall Street’s ETF engine is in full swing, driven by the massive $17 billion Bitcoin haul and the successful debut of Ether ETFs. Asset managers are racing to introduce new crypto funds, while investors are eager to explore these new opportunities. Despite the challenges, the future of crypto ETFs looks promising, with continued growth and innovation on the horizon.

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