Latest Bitcoin and Cryptocurrency News

News

BlackRock’s BUIDL Fund Reaches $500M Milestone as Tokenized Treasury Market Grows

by mei
written by mei 5 minutes read

The market for tokenized U.S. Treasury products is booming. According to rwa.xyz, the market has reached $1.8 billion. One major player in this market is BlackRock, a global asset manager. Their BUIDL token, which is backed by U.S. Treasuries and issued with Securitize, has now surpassed a $500 million market value. This milestone was achieved in just four months since the token’s debut in March, as shown by Ethereum blockchain data on Etherscan.

The Rise of BlackRock’s BUIDL Token

BlackRock’s BUIDL token is the first tokenized treasury product to reach this $500 million milestone. This rapid growth is fueled by decentralized finance (DeFi) protocols such as Ondo Finance and Mountain Protocol. These protocols use BUIDL as a backing asset for their own yield-products. Additionally, digital asset brokers like FalconX and Hidden Road have added BUIDL to their collateral assets for institutional investor clients.

Carlos Domingo, CEO of Securitize, stated, “BUIDL continues to become the base tokenized asset for many other innovative RWA products to be built on.” This shows the significant role BUIDL is playing in the broader tokenized treasury market.

Tokenized U.S. Treasuries and Their Benefits

U.S. Treasuries are at the forefront of the tokenization trend. Many digital asset firms and global financial giants are racing to put traditional instruments like government bonds, private credit, and funds on blockchain. This move aims to achieve faster settlements and operational efficiencies.

Tokenized U.S. Treasuries offer a low-risk investment for companies and investors. They can park their blockchain-based cash and earn a stable yield without leaving the blockchain ecosystem. This is a key reason for the growing popularity of these products.

Market Growth and Major Players

The overall tokenized treasury market, including BUIDL, has more than doubled this year. It grew from $780 million in January to $1.8 billion by June 7, according to rwa.xyz data. BlackRock’s BUIDL token leads the market, claiming roughly 27% of the market share.

Other major players in the tokenized treasury market have also seen significant growth. Franklin Templeton’s offering increased by 16% to $400 million. Hashnote’s product grew by 40%, and OpenEden’s product saw an impressive 89% growth.

The Role of DeFi Protocols

DeFi protocols have been crucial in the success of tokenized treasury products. Ondo Finance and Mountain Protocol, for example, use BlackRock’s BUIDL token as a backing asset. This allows them to offer their own yield-products, attracting more investors to the tokenized treasury market.

These DeFi protocols help increase the liquidity and accessibility of tokenized U.S. Treasuries. They make it easier for investors to participate in the market and earn returns on their investments.

Digital Asset Brokers and Institutional Investors

Digital asset brokers like FalconX and Hidden Road have also played a significant role. They have added BUIDL to their collateral assets for institutional investor clients. This move helps increase the adoption of tokenized treasury products among larger investors.

Institutional investors are attracted to the stability and low-risk nature of tokenized U.S. Treasuries. By integrating these assets into their portfolios, they can diversify their investments and achieve more stable returns.

Real-World Asset Tokenization

The tokenization of real-world assets (RWAs) is a growing trend. U.S. Treasuries are just the beginning. Many digital asset firms and financial heavyweights are looking to tokenize other traditional instruments like private credit and funds.

This trend aims to bring more efficiency and transparency to the financial market. By putting these assets on the blockchain, companies can achieve faster settlements and reduce operational costs.

The Future of Tokenized Treasury Products

The future looks bright for tokenized treasury products. With the market continuing to grow and more major players entering the space, the trend is expected to continue. Investors are likely to see more innovative RWA products backed by tokens like BlackRock’s BUIDL.

As more companies and investors recognize the benefits of tokenized U.S. Treasuries, the market will keep expanding. The ease of access, stability, and potential for returns make these products an attractive option for many.

Conclusion

BlackRock’s BUIDL token has set a new standard in the tokenized treasury market. Its rapid growth to a $500 million market value highlights the potential of tokenized U.S. Treasuries. With DeFi protocols and digital asset brokers driving adoption, and the broader trend of real-world asset tokenization, the market is poised for continued success.

The tokenized treasury market, led by BlackRock, is not just growing but transforming the way investors view traditional financial instruments. This evolution is bringing new opportunities and efficiencies to the financial world, making it an exciting space to watch.

0 FacebookTwitterPinterestEmail
Bitcoin

Bitcoin ETFs See Record $438M Inflows as BlackRock’s IBIT Leads the Way

by Tatjana
written by Tatjana 6 minutes read

Bitcoin Dip Buying Spree

Bitcoin’s price recently dropped, but investors are still buying. In just two days, Bitcoin ETFs saw $438 million in inflows. BlackRock’s IBIT ETF led the way with $180 million in purchases.

Record Inflows on a Single Day

Bitcoin ETFs recorded nearly $300 million in inflows on a single Monday. This is the highest level of buying activity since early June when Bitcoin was trading above $70,000. According to Bloomberg, over $438 million was poured into US ETFs in just two days.

BlackRock’s IBIT ETF was the top performer with nearly $180 million in purchases. Following IBIT, Fidelity’s FBTC also saw significant inflows. Grayscale’s GBTC, which usually sees outflows, recorded over $25 million in purchases.

Factors Influencing Bitcoin Buying

These strong inflows come at a time when Bitcoin is facing selling pressure from multiple sources. One major source is the repayments related to the defunct Mt. Gox exchange. Another source is the German government, which is moving large amounts of Bitcoin to exchanges.

Some analysts believe that investors see this selling pressure as a buying opportunity. CoinShares reported total inflows of $441 million into digital asset investment products for the week. Despite this, trading volumes in exchange-traded products remained relatively low at $7.9 billion, which is typical for summer.

Historical Trends and Current Data

Historically, July has been a bullish month for the crypto market, with a median return of 9%. Many traders expect this trend to continue. Data from SoSoValue shows that the cumulative net inflow for Bitcoin has reached $15 billion, with the daily net inflow at $294 million. The total net assets across these ETFs stand at $49.32 billion, with Bitcoin priced at $55,844.2 at the time of reporting.

This data suggests that despite recent price volatility and selling pressure, institutional interest in Bitcoin through regulated ETF products remains strong. Investors’ willingness to buy during price dips could potentially support Bitcoin’s value in the face of current market challenges.

Spot Bitcoin ETFs See Record Inflows

US spot Bitcoin exchange-traded funds (ETFs) attracted approximately $295 million in inflows on Monday. This was amid ongoing selling pressure from the German government and Mt. Gox repayments. According to SoSoValue, this marks the highest level of single-day inflows in a month.

BlackRock’s IBIT fund led with $187 million in inflows while Fidelity’s FBTC reported $61.5 million. Meanwhile, Grayscale’s GBTC saw $25 million in inflows. Bitwise’s BITB, ARK 21Shares’ ARKB, and VanEck’s HODL followed with $11 million, $8 million, and $1.5 million, respectively. The remaining funds saw no inflows.

BlackRock’s iShares Bitcoin Trust currently holds over $17 billion in assets under management, according to updated data from its official domain.

Selling Pressure from Government and Mt. Gox

The crypto market has been trending downward over the past few weeks. This followed the Mt. Gox repayment announcement and recent wallet activities by the US and German governments.

Since early July, the German government has been constantly selling Bitcoin. According to Arkham Intelligence, the government currently holds around 27,400 BTC, worth $1.5 billion. After recent BTC transfers, the German authorities sold almost half of their BTC holdings, which originally stood at around 50,000 BTC.

Mt. Gox’s Rehabilitation Trustee confirmed that it had initiated the repayment process last Friday. As part of the plan, Mt. Gox’s victims will not receive Bitcoin and Bitcoin Cash repayments directly but through designated crypto exchanges.

These events have likely increased selling pressure across the crypto market. Bitcoin was down 17% in 30 days and is currently trading at around $57,000, according to CoinGecko.

DigitalX Set to Launch Bitcoin Spot ETF on ASX

In Australia, DigitalX Limited, a digital asset fund manager, is set to launch its spot Bitcoin exchange-traded fund (ETF) on the Australian Securities Exchange (ASX) on July 12. ASX is Australia’s leading exchange, handling about 80% of equity trading in the country.

Developed with K2 Asset Management and 3iQ, DigitalX’s new ETF will be listed under the ticker BTXX. With this new listing, DigitalX will become the second asset manager to receive approval to launch a spot Bitcoin ETF on the ASX.

Lisa Wade, CEO of DigitalX, said the new ETF will make it easier for institutional investors to access digital asset fund products. “I believe this will attract new entrants into the market and ultimately allow institutions to include Bitcoin and digital assets into strategic asset allocations,” said Wade.

Other Bitcoin ETFs in Australia

The ASX recently approved a spot Bitcoin ETF from VanEck. VanEck’s Bitcoin ETF (VBTC) went live on June 20 and attracted A$1.5 million (around $1.3 million) on its debut date.

In addition to VanEck and DigitalX, BetaShares, another leading Australian fund manager, is also working to list its Bitcoin and Ethereum ETFs on the ASX.

Conclusion

The recent inflows into Bitcoin ETFs show strong institutional interest in Bitcoin, even during periods of selling pressure. Despite price volatility, investors are buying Bitcoin ETFs, indicating confidence in Bitcoin’s long-term value. The launch of new ETFs, like DigitalX’s on the ASX, further demonstrates the growing acceptance and integration of Bitcoin into traditional investment strategies. As Bitcoin continues to attract attention from both individual and institutional investors, its role in the financial market is likely to expand.

0 FacebookTwitterPinterestEmail
Bitcoin

U.S. House to Vote on Overturning Biden’s SAB 121 Veto: Impact on Crypto Regulations

by Tatjana
written by Tatjana 5 minutes read

U.S. House to Vote on Overturning Biden’s SAB 121 Veto

Introduction

The U.S. House of Representatives will vote on a resolution to overturn President Joe Biden’s veto on a bill related to crypto custody rules. This bill had aimed to cancel the Securities and Exchange Commission (SEC)’s Staff Accounting Bulletin 121 (SAB 121).

Background on SAB 121

SAB 121 is a rule from the SEC that mandates banks holding crypto assets to record these holdings as liabilities on their balance sheets. Because of this rule, many banks and other institutional providers have avoided getting involved in the crypto asset class.

Biden’s Veto and Initial House Vote

President Biden vetoed the legislation after the House initially voted against the SEC’s crypto custody guidance. In May, the House voted 228-182 to strike down SAB 121, with support from both Republicans and 21 Democrats. The Senate also voted to overturn the guidance with a 60-38 vote, again showing bipartisan support.

Scheduled Vote to Overturn the Veto

Last week, House Majority Leader Steve Scalise added the vetoed legislation to the weekly schedule. A new vote is set for Wednesday, July 10, as reported by Fox Business journalist Eleanor Terret. This vote is critical because it requires a two-thirds majority to overturn the president’s veto. This means that around 60 more votes are needed in addition to the initial 228.

Importance of Two-Thirds Majority

For the veto to be overturned, the vote must achieve a two-thirds majority in both houses. This requirement makes the task challenging, as it is a significant increase from a simple majority. However, it is not impossible. The U.S. House has achieved such a feat before with other crypto-related bills.

Previous Crypto Legislation Success

In May, the House successfully passed the Financial Innovation and Technology for the 21st Century Act (FIT21) with a 279-136 vote. This bill aimed to provide a clear regulatory framework for the crypto industry and received strong bipartisan support, with 71 Democrats voting in favor.

Challenges Ahead

Despite previous successes, experts believe achieving the two-thirds majority to overturn Biden’s SAB 121 veto is a tough challenge. The crypto industry and its supporters are keenly watching, hoping for a positive outcome on Wednesday.

Implications for the Crypto Industry

If the House vote succeeds in overturning the veto, it could have significant implications for the crypto industry. It would mean that banks and other financial institutions might start offering crypto custody services, expanding the market and possibly leading to greater adoption of crypto assets.

Conclusion

The upcoming vote in the U.S. House of Representatives to overturn President Biden’s veto on SAB 121 is a crucial event for the crypto industry. With a two-thirds majority needed, the outcome is uncertain, but the potential impact on crypto regulations and market adoption is significant. The industry will be watching closely as the vote unfolds on Wednesday.

Summary of Key Points

  • U.S. House Vote: Set to overturn Biden’s SAB 121 veto.
  • SAB 121: Requires banks to record crypto assets as liabilities.
  • Initial Votes: House voted 228-182; Senate voted 60-38 to strike down SAB 121.
  • Scheduled Vote: New vote set for Wednesday, July 10.
  • Two-Thirds Majority: Needed to overturn the veto, requiring around 60 more votes.
  • Previous Success: House achieved two-thirds majority for FIT21 in May.
  • Challenges: Experts believe achieving the required majority is tough.
  • Implications: Success could lead to banks offering crypto custody services and greater market adoption.

The crypto industry is keenly awaiting the results of the U.S. House vote on Wednesday. Whether or not the two-thirds majority is achieved will have a lasting impact on the future of crypto regulations in the United States.

0 FacebookTwitterPinterestEmail
Ethereum

Staked Ethereum Hits 27% Supply as ETF Trading Nears

by Tatjana
written by Tatjana 7 minutes read

Introduction to Ethereum Staking

Staked Ethereum has reached a new milestone, with over 27% of the total supply currently being staked. This means that more than 32.6 million ETH is now securing Ethereum’s proof-of-stake network. The rise of Ethereum staking has brought up concerns about centralized firms controlling too much ETH.

Concerns Over Centralized Staking

Some people worry that having too much Ethereum staked by a few centralized firms can be risky. It could lead to these firms having too much control over the network. This has become a major topic of discussion as the crypto market eagerly awaits the potential launch of spot Ethereum ETFs in the U.S.

Regulatory Concerns for ETFs

Spot Ethereum ETFs in the U.S. are facing regulatory concerns. Providers of these ETFs won’t be able to stake their ETH due to these rules. This means they cannot participate in staking to earn rewards. As a result, they are looking for other ways to benefit from holding Ethereum.

Anticipation for Ethereum ETFs

The crypto market is excited about the possible launch of spot Ethereum ETFs. However, the approval process by the SEC has been slower than expected. Bloomberg ETF analyst James Seyffart mentioned that these ETFs might start trading as early as next week or by the week of the 15th.

Recent Developments in Ethereum ETFs

Recently, Bitwise filed an amended S-1 form just before the July 8 deadline, showing that their product is almost ready for launch. Following this, VanEck also filed an amended S-1 form. These filings are crucial steps towards launching the first spot Ethereum ETFs in the U.S.

Innovative Approaches to Ethereum Staking

With ETFs unable to stake, traditional finance players are finding new ways to get involved. For example, Franklin Templeton, which manages $1.6 trillion in assets, plans to launch a fund focused on altcoins and staking rewards. Meanwhile, Purpose Investments in Toronto already has an Ethereum fund that can stake its ETH.

The Impact of Staking on Ethereum’s Future

The rise in staked ETH has been steady, even though there was a brief slowdown after the Shanghai upgrade in spring 2023. As of now, Ethereum is trading just below $3,000, down 14% over the past week due to broader market volatility.

SEC Approval Process

The SEC’s approval process for Ethereum ETFs has been slower than initially expected. Bloomberg ETF analyst James Seyffart noted on Twitter that these ETFs might start trading later next week or the week of the 15th.

Bitwise and VanEck Filings

Bitwise filed an amended S-1 form ahead of the July 8 deadline, indicating that the products are nearly ready for launch. VanEck then filed its own amended S-1 on Monday. The inability of ETFs to stake has led to new strategies from traditional finance players.

Franklin Templeton’s New Fund

Franklin Templeton, which manages $1.6 trillion in assets, is planning to launch a fund focused on altcoins and staking rewards. Meanwhile, Purpose Investments in Toronto already has an Ethereum fund that’s allowed to stake the underlying ETH.

Excitement About Ethereum

“We’ve always been excited about Ethereum and what the technology and ecosystem represent,” said a spokesperson from Purpose Investments. “Initially, a corporate structure was the best option; now we believe an ETF is the most efficient.”

Staking and ETFs: The Future

The activity around Ethereum staking and ETFs raises questions about the future of the ecosystem. As more institutional players join in and the percentage of staked ETH climbs, the Ethereum community is watching to see how these changes affect the network’s security, decentralization, and overall health.

Insights from Danny Ryan

Danny Ryan, an Ethereum Foundation researcher, shared his thoughts on staking economics at the EthStaker Staking Gathering. “Staking on Ethereum is influenced by reward curves and overall economic incentives built into the protocol,” he said. “The goal is to create a sustainable and secure system that encourages participation and maintains the network’s integrity.”

Market Volatility and Staking Trends

The recent market downturn, attributed to factors like the imminent Mt. Gox repayments and macroeconomic concerns, saw Bitcoin fall below $55,000 again. This volatility highlights the complex relationship between staking trends, ETF anticipation, and broader market forces.

The 27% Staking Milestone

For now, the 27% staking milestone shows the growing belief among ETH holders that staking is the future. Whether this future includes ETFs or new staking-focused funds and companies is still unclear. The crypto world is waiting for the SEC’s final decision, which could be a transformative moment in Ethereum’s history.

VanEck’s Spot Ethereum ETF

In other ETF news, VanEck has officially filed an S-1 for a spot Ethereum ETF with the SEC. This filing is a key step towards potentially launching the first spot Ethereum ETF in the U.S. The proposed VanEck Ethereum ETF would trade on the Cboe BZX Exchange under the ticker symbol “ETHV.”

Fund Performance and Market Rates

The fund’s objective is to reflect the performance of Ethereum’s price, minus expenses. According to Bloomberg ETF analyst Erich Balchunas, this move from VanEck should be followed by similar filings from other issuers, except Bitwise, which has already filed its S-1.

VanEck’s Filing Details

The ETF would hold actual Ethereum and value its shares daily based on the MarketVector Ethereum Benchmark Rate. This index uses prices from what VanEck considers the top five Ethereum trading platforms. The filing states that neither the trust nor any associated parties will engage in Ethereum staking or other yield-generating activities with the fund’s assets. The ETF would initially only allow cash creations and redemptions by authorized participants.

Path to Approval

VanEck’s filing comes as the crypto industry waits for the SEC’s approval of the first spot Ethereum ETF. This ETF could provide more direct exposure to Ethereum’s price movements compared to existing futures-based products. ETF analysts like Nate Geraci estimate that issuers are preparing for a launch in the next few weeks.

Market Manipulation and Investor Protection

The path to approval is still uncertain. To date, the SEC has not approved any spot crypto ETFs, citing concerns around market manipulation and investor protection. The regulator will review VanEck’s application in the coming weeks.

In conclusion, the growing interest in Ethereum staking and the anticipation of spot Ethereum ETFs highlight the evolving landscape of the crypto market. As more institutional players enter the scene and regulatory frameworks take shape, the future of Ethereum and its staking ecosystem will be closely watched by the crypto community.

0 FacebookTwitterPinterestEmail
Bitcoin

Bitcoin Dips Below $55,000: Significant Selling Pressure Ahead

by Tatjana
written by Tatjana 3 minutes read

Bitcoin Price Drop

Bitcoin dipped below $55,000, falling by 6% to $54,600 over the weekend. This drop came despite some recovery from the losses at the end of the previous week. Bitcoin is the world’s largest cryptocurrency by market capitalization and fell to a low of $54,000 on Friday, according to Decrypt data. Currently, Bitcoin is trading at around $55,300.

Market Uncertainty and Selling Pressure

Several factors are causing uncertainty in the crypto market. One major factor is potential selling pressure from the German government. Germany holds 39,826 BTC, worth about $2.2 billion at current prices, according to Arkham Intelligence. Additionally, 127,000 creditors from the Mt. Gox bankruptcy estate are awaiting their crypto funds.

Brief Price Rally

Over the weekend, Bitcoin attempted a brief price rally, trying to regain a footing above $58,000 by Sunday. However, it couldn’t hold onto those gains and ended up trading at its lowest point since late February.

Impact of Mt. Gox Repayments

Users from the defunct Japanese exchange Mt. Gox are waiting to receive up to $7.7 billion in funds lost due to a hack over 10 years ago. Repayments from Mt. Gox are set to begin this month, with the exchange planning to distribute around 142,000 BTC and 143,000 Bitcoin Cash. This large distribution could add significant selling pressure to the Bitcoin market.

Summer Trading and Market Trends

Summer usually brings a lull in the crypto markets. However, this year might be different. With an excess supply of Bitcoin and downward momentum, traders could see a busier period than expected. More supply flooding the market can lead to a significant impact on prices, especially if the order books are thinly traded.

Crypto Market Liquidations

Liquidations across the crypto market show that long positions have been wiped out to the tune of $175 million, according to CoinGlass data. Short positions have also been hit, with $35 million erased, amounting to some $210 million in total. This followed an extensive sell-off on Thursday and Friday, which saw $600 million in liquidations after Bitcoin briefly dropped below $55,000.

Broader Market Impact

The broader financial markets are also experiencing a liquidity shortfall in Q2 2024. The Federal Reserve’s reverse repo balance surged by over $200 billion last week to $664.5 billion. This hints at a significant liquidity drain, affecting various markets, including cryptocurrencies.

Conclusion

The current Bitcoin market is facing several challenges. Between government holdings, Mt. Gox repayments, and general market uncertainty, Bitcoin traders should brace for possible significant selling pressure in the months ahead. With summer typically bringing a lull, this year’s excess supply might create a different trading environment. Keep an eye on the broader financial impacts as well, as they play a crucial role in shaping the crypto market’s future.

0 FacebookTwitterPinterestEmail
Bitcoin

Spot Bitcoin ETFs See Record Inflows After July 4 Price Dip

by Tatjana
written by Tatjana 5 minutes read

Bitcoin Price Correction Sparks ETF Inflows

After Bitcoin’s price dropped below $54,000 on July 4, Spot Bitcoin exchange-traded funds (ETFs) in the United States saw a big jump in inflows. On July 6, these Spot Bitcoin ETFs experienced record inflows, with $143.1 million coming in, according to Farside Investors. This surge happened after Bitcoin’s price correction, which created a great opportunity for ETF investors to buy the dip.

Major ETFs See Large Inflows

The Fidelity Wise Origin Bitcoin Fund (FBTC) led the way with $117 million in inflows. Following close behind, the Bitwise Bitcoin ETF (BITB) recorded a net inflow of $30.2 million. The ARK 21Shares Bitcoin ETF (ARKB) and VanEck Bitcoin Trust (HODL) ETFs saw inflows of $11.3 million and $12.8 million, respectively. However, not all funds saw gains. The Grayscale Bitcoin Trust (GBTC) had a net outflow of $28.6 million during this period.

Institutional Investors Take Advantage of the Dip

The strong inflows into Spot Bitcoin ETFs indicate that institutional investors and large-scale buyers are using the Bitcoin price dip to accumulate BTC at lower prices. Hunter Horsley, CEO of Bitwise Asset Management, emphasized his team’s efficiency in buying Bitcoin at a very low cost. He pointed out that the current market conditions offer a prime opportunity for both new and existing investors to buy Bitcoin. “The outlook for Bitcoin has never been stronger. For many who don’t yet have exposure, this week is a chance to buy the dip,” Horsley stated.

Bitwise Bitcoin ETF’s Growing Holdings

During the first week of July, the Bitwise Bitcoin ETF (BITB) registered inflows of over $66 million. This increase brought BITB’s total Bitcoin holdings to over 38,000 BTC. This demonstrates the strong confidence investors have in this ETF despite recent market fluctuations.

Bitcoin Ichimoku Cloud and Market Bounce

Related to the positive sentiment, the Bitcoin Ichimoku cloud provided reassurance as BTC prices bounced back from a four-month low. Renowned Bitcoin critic Peter Schiff also weighed in, noting that Bitcoin ETF investors have shown resilience. Despite recent market turbulence, Schiff observed that these investors remain committed to holding their assets, showing no signs of panic. “So far, there’s no sign of panic. It will likely take a much larger drop in Bitcoin before they finally capitulate,” Schiff commented. He further predicted a significant sell-off might happen soon, potentially leading to a capitulation among Bitcoin holders.

Mt. Gox Bitcoin Transfer

Bitcoin’s price recently fell to $55,200 on Coinbase. This drop followed a major transfer of 47,229 Bitcoin, worth around $2.71 billion, by the collapsed Japanese crypto exchange Mt. Gox. This was Mt. Gox’s first significant transaction since May and added to the market’s volatility.

Germany’s $111 Million Bitcoin Buyback

In an unexpected move, the German government, known for its recent large-scale Bitcoin sell-offs, bought back a significant amount of Bitcoin. Arkham Intelligence revealed that Germany purchased 1,915 BTC, worth $111.5 million, from major exchanges like Kraken, Bitstamp, and Coinbase. This buyback came after weeks of high-profile Bitcoin sales by the German government, which had sparked market volatility and raised questions about their crypto strategy. The sudden buyback has ignited speculation and renewed optimism among Bitcoin investors worldwide.

Government Bitcoin Transfers and Market Impact

On Friday morning, the German government transferred 1,047.4 BTC out of their wallets, worth $57.2 million. Of this, 547.4 BTC valued at $30.1 million was transferred to Flow Traders. Another 500 BTC, worth $27.1 million, is believed to have been sent for institutional or OTC services. Earlier in the month, the German government made another significant move, transferring 832.7 Bitcoins valued at approximately $52 million to major exchanges such as Bitstamp, Coinbase, and Kraken. Just two days later, they made another massive transfer of 3,000 Bitcoins, worth approximately $174 million. These moves have kept the market on edge, with Bitcoin’s value hitting a low of $53,700 yesterday.

Justin Sun’s Proposal to Stabilize the Market

In response to these significant transfers, Justin Sun, the founder of Tron (TRX), expressed his intention to negotiate with the German Government. Sun aims to minimize the impact of their sales on the market by suggesting off-market transactions. His goal is to find a solution that benefits all parties involved and prevents significant price fluctuations.

Conclusion

The recent Bitcoin price correction has led to record inflows for Spot Bitcoin ETFs, showing strong confidence among institutional investors. Major ETFs like the Fidelity Wise Origin Bitcoin Fund, Bitwise Bitcoin ETF, ARK 21Shares Bitcoin ETF, and VanEck Bitcoin Trust have seen significant investments. Despite market turbulence and major transactions by entities like Mt. Gox and the German government, investor sentiment remains positive. The moves by the German government, especially their surprising buyback, have sparked renewed interest and optimism in the Bitcoin market.

0 FacebookTwitterPinterestEmail
Bitcoin

Bitcoin Prices Surge Nearly 6% After Hitting Four-Month Low

by Tatjana
written by Tatjana 4 minutes read

Bitcoin Prices Rally Nearly 6% After Recent Low

Bitcoin prices went up almost 6% today after hitting their lowest point since February. This increase comes after a tough market period for the world’s most well-known digital currency.

Market Conditions and Price Data

Earlier today, Bitcoin reached as high as $56,856.61, according to CoinMarketCap data. This was a big jump from its low of $53,717.34, which it hit just after midnight EST. This low was the lowest value Bitcoin had seen in over four months. After reaching its high, Bitcoin experienced some ups and downs but managed to keep most of its gains.

Reasons Behind Price Fluctuations

Several analysts shared their thoughts on why Bitcoin prices have been changing so much. They believe the digital currency became oversold in the last 24 hours, which led to today’s rally.

One major reason for the recent drop was the news that the Mt. Gox trustee started paying some creditors. Mt. Gox was a major Bitcoin exchange that collapsed years ago, and its creditors have been waiting a long time to get their money back.

Analysts’ Opinions

Tom Anyking, managing partner, talked about the different factors that caused Bitcoin to drop. He mentioned the market was already weak because of a few reasons: the usual summer slowdown, post-ATH (All-Time High) consolidation, and the SEC delaying the start of spot ETH ETF trading. The Mt. Gox payments added more pressure, causing Bitcoin prices to fall below $60,000 and nearly reach $53,000.

Arman Feire, an independent cryptocurrency analyst, also pointed out several factors. He noted that the new supply from the Mt. Gox trustee showed Bitcoin transfers to unknown addresses. He also mentioned that the German government was preparing to sell more Bitcoin. Combined with a low fear and greed index, these factors scared the market, leading to price drops across the board.

Market Rebound

Once Bitcoin prices fell, the digital currency became oversold, which caused a rally. Feire explained that this overselling made Bitcoin prices jump back up.

Julio Moreno, head of research for CryptoQuant, had a different view. He said that the price drop was mainly due to large investors (known as whales) and mid-size miners selling or taking profits. According to Moreno, the selling from Mt. Gox and other entities like the German government was small compared to the overall amount of money in Bitcoin.

On-Chain Metrics and Oversold Territory

Moreno also pointed out that several on-chain metrics showed Bitcoin was in oversold territory after hitting $53,000. This could explain why prices rebounded sharply. For instance, traders’ unrealized profits hit negative levels not seen since the FTX collapse.

Impact of Government Seizures

Moreno shared that the amount of money seized by the U.S. and German governments was only a tiny fraction (about 1.6%) of Bitcoin’s total realized value. This small amount helped prevent a larger impact on Bitcoin prices.

Future Predictions

Looking ahead, Enneking suggested that the Mt. Gox sales might not hurt the cryptocurrency market as much as some people think. He believes that the investors getting their Bitcoin back will probably hold onto it instead of selling right away. Since they’ve already waited 10 years, they might wait a few more months for the price to recover.

Enneking thinks Bitcoin is oversold and the market seems to agree that its fair value is in the mid-to-high $50,000 range. Once the Bitcoin from Mt. Gox is distributed and if nothing drastic happens, he predicts Bitcoin will see a healthy rebound.

Conclusion

In summary, Bitcoin prices rallied nearly 6% today after hitting their lowest point since February. Several factors, including the Mt. Gox payments, a weak market, and a low fear and greed index, contributed to the recent price drops. However, overselling led to a market rebound. Analysts believe that there is still room to rebound.

0 FacebookTwitterPinterestEmail
Ethereum

Ethereum Staking ETFs Set to Launch in Hong Kong: A Six-Month Timeline

by dave
written by dave 6 minutes read

Ethereum staking ETFs will soon be available in Hong Kong. Within six months, these new crypto products will hit the financial hub, and the city has even more plans for the future.

Launch of Ethereum Staking ETFs

Hong Kong is set to launch Ethereum staking exchange-traded funds (ETFs) in the next six months. After the successful launch of Bitcoin and Ethereum ETFs in April, which were warmly received by the financial sector, the city is eager to offer more crypto products. A Uniswap ETF or Chainlink ETF might follow the Ethereum staking ETFs.

Key Role of HashKey Capital

Vivien Wong, a partner at HashKey Capital, a crypto asset management firm, played a vital role in launching Hong Kong’s spot Bitcoin and Ethereum ETFs. Wong shared that as soon as spot Ethereum ETFs were approved in the US, there was immediate interest in an Ether staking product. The firm has been in talks with the Hong Kong Securities and Futures Commission about the need for an Ether staking ETF. Regulators responded positively, asking for a detailed proposal.

US Spot Ethereum ETFs

Nine spot Ethereum ETFs are expected to launch in the US soon. Ethereum staking ETFs allow users to lock in their Ether holdings and earn a 3% yield, a process called staking. Unlike spot Ethereum ETFs, which give investors easy exposure to Ether through their brokerage accounts, staking ETFs offer the additional benefit of earning yield.

Fees and Launch Timeline

In Hong Kong, holders of these ETF shares must pay a management fee between 0.3% and 0.99%, depending on the fund. According to Wong, launching a new Ethereum staking product will likely take about six months.

Bitcoin ETF Issuers

Here are some key Bitcoin ETF issuers:

  1. Blackrock (IBIT) – $18.4 billion AUM, $32.20 price
  2. Grayscale (GBTC) – $16.38 billion AUM, $50.15 price
  3. Fidelity (FBTC) – $9.53 billion AUM, $49.43 price
  4. Ark/21 Shares (ARKB) – $2.62 billion AUM, $56.46 price
  5. Bitwise (BITB) – $1.07 billion AUM, $30.80 price
  6. VanEck (HODL) – $569.24 million AUM, $63.87 price
  7. Valkyrie (BRRR) – $501.52 million AUM, $16.01 price
  8. Invesco/Galaxy (BTCO) – $395.5 million AUM, $56.49 price
  9. Franklin Templeton (EZBC) – $334.46 million AUM, $32.77 price
  10. WisdomTree (BTCW) – $77.31 million AUM, $60.01 price

Hong Kong’s Fintech Ambitions

Hong Kong aims to become a fintech powerhouse by offering innovative products that aren’t yet available in the US. The process of launching these products has been smooth, attracting two types of investors: those who want to “buy and hold” and crypto natives. Crypto natives, in particular, appreciate the ETFs’ design, which allows for timely creation and redemption processes used in over-the-counter trading.

DeFi and Metaverse in Hong Kong

Hong Kong’s finance watchdogs are also focused on DeFi (decentralized finance) and the metaverse. By leading in advanced products, Hong Kong hopes to attract investors from other regions, especially mainland China. Wong hopes that an endorsement from China will open up the market further and bring in more inflows.

Success of Hong Kong’s Crypto ETFs

Since their launch in April, Hong Kong’s crypto ETFs have amassed nearly $260 million in assets. While this may seem small compared to the $14.6 billion brought in by US spot Bitcoin ETFs since January, it’s a significant achievement given Hong Kong’s ETF market size. The excitement around these products is palpable, with financial institutions, wealth managers, distributors, and high-net-worth individuals gradually becoming more comfortable with them.

Overcoming Challenges

Launching these products wasn’t guaranteed. Opinions about crypto had soured in the region due to scandals, such as the fraud case surrounding the Hong Kong crypto exchange JPEX. Despite these challenges, the ETFs have been successful.

Potential for Uniswap and Chainlink ETFs

Wong mentioned that other cryptocurrencies might also get their own ETFs, though the choices aren’t obvious. For Hong Kong regulators to approve new crypto ETFs, the underlying token must be publicly tradable on registered virtual asset trading platforms and be highly liquid. Having a robust use case is also beneficial. ERC-20 tokens, like Chainlink or Uniswap, are generally preferred.

Future of Solana ETF

A Solana ETF might also be in the cards. Wong said they are currently in discussions with the Securities and Futures Commission about launching new products. Hong Kong is eager to expand its offerings and maintain its position as a leader in fintech innovation.

By launching Ethereum staking ETFs and exploring other crypto products, Hong Kong is positioning itself as a major player in the crypto and fintech industries. The financial hub’s efforts are drawing attention from investors globally, and its future looks promising.

0 FacebookTwitterPinterestEmail
Bitcoin

Bitcoin Price Drops to $54,000 Triggering $600 Million Liquidations Amid Mt. Gox Concerns

by Tatjana
written by Tatjana 4 minutes read

Bitcoin Hits Lowest Point Since February

Bitcoin, the world’s largest cryptocurrency by market capitalization, has dropped to its lowest level since February. The price fell to $54,000, causing a massive wave of liquidations worth hundreds of millions of dollars. This decline has shaken the crypto market, with many investors worried about future prices.

Massive Liquidations in the Crypto Market

Due to Bitcoin’s price drop, there have been huge liquidations in long positions. Long positions are bets that the price of Bitcoin will go up. According to CoinGlass data, these liquidations have totaled over $500 million in the past 24 hours. This is the biggest single-day wipeout for the crypto market since mid-April. Short positions, which are bets that the price will go down, have also been affected, with $80 million being liquidated.

Bitcoin’s Price Recovery Attempts

After falling to $54,000, Bitcoin has managed to recover slightly. It is now trading around $54,550, according to CoinGecko data. However, it is still struggling to regain a stable position above $60,000. The drop in price has been attributed to a lack of investor confidence and other concerns in the market.

Concerns Over Mt. Gox Bitcoin Transfer

One major issue causing worry among investors is the recent transfer of Bitcoin from the Mt. Gox bankruptcy estate. Mt. Gox, a defunct Bitcoin exchange, has moved $2.7 billion worth of Bitcoin from cold storage to an unidentified wallet. This transfer has added to the fears of declining crypto prices. Blockchain analytics firm Arkham Intelligence reported that the estate transferred 47,228 BTC, worth roughly $2.71 billion. This move followed several smaller test transactions conducted by the estate.

Impact on Other Cryptocurrencies

The decline in Bitcoin’s price has also affected other cryptocurrencies. Ethereum, the second-largest cryptocurrency, fell more than 4% and is now below $2,900. This is the first time Ethereum has fallen below this level since May 17. The overall uncertainty in the market has had a negative impact on the prices of various cryptocurrencies.

Federal Reserve’s Influence on Crypto Prices

Another factor influencing crypto prices is the U.S. Federal Reserve’s efforts to control inflation. The Fed’s ability to manage inflation this year is causing concern among investors. This uncertainty is taking a toll on risk assets, including cryptocurrencies. As a result, crypto prices might continue to fall. Some experts predict that Bitcoin could drop further to $52,000.

Investor Confidence and Market Instability

Investor confidence has been shaken by the recent events in the crypto market. The large-scale liquidations and the Mt. Gox Bitcoin transfer have caused many to question the stability of the market. Bitcoin’s struggle to stay above $60,000 is a sign of this instability. The crypto market’s future remains uncertain, with many investors watching closely for any signs of recovery or further decline.

Future Predictions for Bitcoin and the Crypto Market

Looking ahead, the future of Bitcoin and the broader crypto market remains uncertain. The combination of large liquidations, the Mt. Gox transfer, and concerns over inflation control by the Federal Reserve are creating a volatile environment. Some experts believe that Bitcoin could see further declines, potentially reaching $52,000. Others are hopeful that the market will stabilize and recover in the coming months.

Where to from here?

Bitcoin’s price drop to $54,000 has triggered significant liquidations in the crypto market, totaling $600 million. The transfer of $2.7 billion in Bitcoin from the Mt. Gox estate has added to investor concerns. With the influence of the Federal Reserve’s inflation control efforts, the market is facing a challenging period. The future of Bitcoin and other cryptocurrencies remains uncertain, with potential for further declines or recovery depending on various factors. Investors are advised to stay informed and cautious during this volatile time in the crypto market.

0 FacebookTwitterPinterestEmail
Ethereum

$5 Billion Ethereum ETF Inflows Could Propel Prices Above $4,000

by Tatjana
written by Tatjana 6 minutes read

$5 Billion in Ethereum ETFs Inflows Could Propel Prices Above $4,000

Eight fund issuers are currently waiting for the U.S. Securities and Exchange Commission (SEC) to give final approval to list and launch exchange-traded funds (ETFs) that will track the spot price of Ethereum (ETH). This could have a significant impact on Ethereum prices.

All About ETH: ETF Flow Predictions and Risks

Ethereum (ETH) has underperformed the broader cryptocurrency market so far this year. In this report, we delve into the factors driving ETH prices and estimate potential net inflows of $3-5 billion into ETH ETFs upon final approval, explaining how this could lead to a price rally for ETH.

Why ETH is Lagging

Despite a broad upswing in crypto prices since 2023, ETH has been a notable laggard. As the second largest cryptocurrency by market capitalization, Ethereum’s market cap was over 50% that of Bitcoin in September 2022. This was just before the shift from Proof of Work to Proof of Stake. Today, that ratio is 33% after a prolonged decline. In contrast, Solana, a Layer 1 competitor, saw its market capitalization grow from 3% to over 20% of Ethereum’s in early 2023.

Factors Behind ETH’s Underperformance

There are three main factors driving ETH’s underperformance:

  1. Approval of Spot Bitcoin ETFs: The success of spot Bitcoin ETFs in attracting investor inflows has impacted ETH’s market dynamics.
  2. Speculative Activity: A surge in speculative activity led by memecoins has favored Solana over Ethereum.
  3. Regulatory Scrutiny: Increased regulatory scrutiny on the Ethereum ecosystem, including its major applications like Uniswap, has affected investor sentiment.

The Case for Spot Bitcoin ETFs

The launch of spot Bitcoin ETFs in January 2024 was a major success. By mid-June 2024, net inflows into these ETFs were just under $15 billion. This includes over $18 billion in net outflows from Grayscale’s Bitcoin Trust (GBTC), which converted to an ETF. The success of Bitcoin ETFs is largely due to Bitcoin being viewed as decentralized digital gold.

Expected Inflows for ETH ETFs

We estimate that spot ETH ETFs will garner $3-5 billion in the first six months of trading. Comparisons with international markets suggest that ETH ETFs could have around 25-30% of the assets under management relative to Bitcoin ETFs. In Sweden, for example, ETH assets are almost 60% of Bitcoin’s, while in Canada, they are about 28%.

The Impact of ETH ETF Approvals

Currently, eight fund issuers have received initial approvals for spot ETH ETFs and are waiting for final approval. Although the timeline has been delayed, an eventual approval is expected. Prediction markets are currently pricing a 73% chance of launch by early July 2024, although this has recently dropped to 2%.

ETH vs. BTC: Market Dynamics

Ethereum has a market capitalization ratio of 33% compared to Bitcoin. From a risk perspective, ETH has a slightly higher volatility ratio compared to BTC. This makes it difficult to argue for significant portfolio diversification benefits beyond an equally-weighted allocation of both assets.

Ethereum’s Use Cases

Unlike Bitcoin, which is seen as digital gold, Ethereum has various use cases and strong on-chain fundamentals. The ratio of daily active addresses on Ethereum versus Bitcoin has consistently exceeded 60%. Additionally, transaction fees paid to use Ethereum are twice those of Bitcoin. Layer 2 scaling solutions have also grown sharply, handling far more transactions than Ethereum’s Layer 1. Most stablecoins are based on Ethereum, further boosting its utility.

Supply Dynamics Favoring ETH

The shift to Proof of Stake has also improved Ethereum’s supply dynamics. The total supply ratio of Ethereum relative to Bitcoin has decreased from 6.3 in summer 2022 to 6.1 today. This reduction in supply is another factor that could boost ETH prices.

Risks and Rewards of an ETH Catch-Up Trade

Given the factors discussed, we estimate net inflows of $3-5 billion into spot ETH ETFs in the first six months. This would mean a total AUM of $13-15 billion for spot ETH ETFs in the US, including the current ETHE AUM. Inflows below $3 billion would be disappointing, while inflows exceeding $5 billion would be a strong positive surprise.

Impact of Memecoins on Ethereum

Memecoins like DOGE and SHIB, which are based on Ethereum, have seen their trading volumes diminish in 2024 in favor of memecoins on Solana, where fees are cheaper. Memecoins briefly surpassed ETH spot trading volumes in March 2024. However, memecoins carry significant risks due to their speculative nature and concentrated ownership structures.

Regulatory Scrutiny on Ethereum

In 2024, the Ethereum ecosystem faced several regulatory actions. Uniswap Labs received a Wells Notice, and Consensys filed a lawsuit against the SEC. Developers of TornadoCash, an anonymizing service, were also targeted. However, recent developments suggest a shift in regulatory stance. The SEC has closed its investigation into Ethereum 2.0, and there is growing support for Ethereum-based stablecoins to hold US Treasuries.

Conclusion

Spot ETH ETFs are likely to begin trading soon, with Ethereum’s market value relative to Bitcoin near multi-year lows. Given the strong on-chain metrics and international ETF comparisons, there is a favorable risk-reward scenario for an ETH catch-up trade in the coming months. A return to the median of the ETH/BTC ratio range from the last three years would imply a 20% rally, while a return to the maximum would mean a 55% rally.

0 FacebookTwitterPinterestEmail
Newer Posts
Older Posts

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More