Newsletter 76
31st May 2024
THE MARKET THIS WEEK
Advisors’ Guide to Crypto: The Development of Crypto and TradFi Since the launch of Bitcoin fifteen years ago, a lot has happened. Numerous alternative distributed database networks have been developed, each with unique features and possible applications. It was a momentous week for regulatory developments in the United States as the SEC approved the spot ether ETF listings and the House of Representatives decided to approve a new cryptocurrency law.
Dogwifhat’s 10% decline may be “catastrophic,” but traders are betting on a reversal The price of the WIF meme coin is currently below what some consider to be a worrying level, but it appears that many traders are “betting on a WIF bounce.” WIF’s price must remain above $3.5 to avoid potentially disastrous outcomes. Hours before the price drop, on May 30, he warned traders in an X post to his 319,200 followers.
Texas university and bitcoin company combine on a $5 million endowment fund UATX and a bitcoin financial services company intend to fund $5 million to finance five years’ worth of BTC investments. Tradesman Purchases 2M Call Options for Dogecoin as a Meme The Coin Market Gets Hotter The options have a strike price of $0.22, which is around 31% higher than the current price, and they expire on June 14.
Warren presses narcotics enforcement about cryptocurrency’s connection to the fentanyl trade Senators William Cassidy and Elizabeth Warren claim that cryptocurrency has a “increasingly prominent role” in the fentanyl trade. Senator Elizabeth Warren of the United States is requesting an update from drug authorities regarding their most recent research and initiatives regarding the use of cryptocurrency in the black market for fentanyl.
Bitcoin traders await US macro data with a $67K price cap. In a sideways market, bitcoin bulls don’t seem to be able to make much of a difference. Instead, traders are hoping that macro data will change the way that BTC price activity is conducted. Given that it indicates a large appetite for Bitcoin futures, the high open interest may be interpreted as a bullish emotion. On the other hand, a normal 10% market correction may cause cascade liquidations, which would intensify the price decline, if bulls rely too much on leverage. Notably, since US governmental pressures have subsided, the price of Bitcoin has demonstrated resiliency.
The increasing trend of ether is supported by growing open interest. One factor supporting Ether’s gain is the increase in open long ETH positions in the futures market. According to data from on-chain market intelligence company CryptoQuant, Ethereum’s total open interest in the derivatives market jumped from 2.8 to 3.2 million ETH in a matter of hours on May 20, following reports that the US Securities and Exchange Commission (SEC) was reversing course on approving spot Ethereum ETFs. This is the biggest level of open interest since January 2023.
KEY METRICS
Total Crypto Market Cap : $2.65T
Bitcoin Market Cap : $ 1.32T
Ethereum Market Cap : $ 421.48B
ETH/BTC Ratio : 0.05
Ethereum Gas Price : 8 gwei
DeFi TVL : $200.73b
Fear and Greed Index : 73 (Extreme Greed)
Federal Reserve Balance Sheet : $7.28 T
BATTLE OF THE BULL AND BEAR
Consensus 2024: Brad Garlinghouse of Ripple Predicts XRP, Solana, and Cardano ETFs
The CEO of Ripple stated on stage at Consensus 2024 in Austin that it’s just a matter of time. It’s inevitable that there will be exchange-traded funds (ETFs) for XRP, Solana (SOL), and Cardano (ADA), and that’s fantastic,” he stated. XRP and Ripple are closely related.
The price of bitcoin strives for $69K as “hot.” US macro data puts pressure on the currency
On the strength of statistics on unemployment claims and the US GDP, Bitcoin breaks past overhead barrier, providing a boost to risk assets in general.Open interest in bitcoin futures hits a 16-month high: $70,000 awarded? Moderate bullishness in BTC derivatives opens the door for more advances above $70,000. Investors shift their focus from fixed-income instruments, preferring the performance of Bitcoin. To hit a new all-time high, Bitcoin requires a CPI print of “3.3% or lower.” Although the fluctuations in the price of bitcoin may seem arbitrary, a crypto analyst claims that important factors like inflation are responsible for the market’s oscillations. In a report published on May 29 ahead of schedule, lead researcher Markus Thielen of 10x Research predicted that Bitcoin would reach a new all-time high if inflation prints 3.3% or lower.
Crypto losses due to hacking and fraud decreased by 12% in May, according to Immunefi The amount of money lost in cryptocurrency scams and frauds decreased to $52 million in May from $59 million in the same month last year. The majority of the losses, according to Immunefi’s assessment dated May 30, were caused by two distinct attacks. The first included losses of almost $21 million due to a compromise of the Web3 gaming protocol Gala Games. The other involved a smart contract hack against Sonne Finance that resulted in losses of $20 million. When combined, these two attacks accounted for 78% of the month’s total losses.
A “legitimate possibility” for the June launch of the Ethereum ETF as BlackRock files S-1
Analysts say that BlackRock’s amended Form S-1 for its spot Ether ETF is a “good sign” that issuers and the SEC are actively working on ETF launches. He also mentioned that there will probably be another round to “fine tune” SEC opinions, but that a debut “end of June [is] a legit possibility.” Balchunas stated that an earlier approval would be a “long shot,” but he maintained his approval odds for about July 4.
WEEKLY REVIEW OF IC15
The global cryptocurrency market remained negative ahead of inflation data and speculation of high interest rates. The IC15 Index was down 992 points to 86,816 at 4 p.m. All the coins in the Index were negative, with Shiba Inu, Polkadot, Polygon, and Dogecoin being the major losers in the 4–7% range.
US lawmaker Patrick McHenry is confident that the US will have crypto legislation within the following year. He reveals that crypto policy is inevitable and has become a central issue due to the upcoming US presidential election. The Bank of Israel launches a Digital Shekel Challenge to provide a sandbox environment to participants and develop real-time CBDC payment systems for its people.
German banking giant Deutsche Bank will use blockchain technology to compress margins in the financial sector amid declining revenue and enhance efficiency. Stablecoin issuer Circle will launch its services in Brazil by partnering with BTG Pactual and Nubank to drive USDC adoption and provide digital asset infrastructure to the market.
The Bank of England and the Financial Conduct Authority (FCA) launched the Digital Securities Sandbox to integrate emerging technologies like blockchain with traditional financial systems. Furthermore, the London Stock Exchange (LSE) will list crypto exchange-traded products (ETPs) for the first time after prospectuses from WisdomTree and 21Shares were approved by the FCA.
WEEKLY SPOTLIGHT
Notwithstanding inflation data and anticipation about rising interest rates, the global cryptocurrency market remained bearish. After 992 points of decline, the IC15 Index was at 86,816 at 4 PM. With Shiba Inu, Polkadot, Polygon, and Dogecoin having the biggest losers in the 4–7% region, all of the coins in the Index were showing negative values.
Congressman Patrick McHenry of the US is optimistic that the country would pass crypto legislation in the upcoming year. He discloses that the impending US presidential election has made crypto policy a crucial topic and that it is unavoidable. In order to give participants access to a sandbox environment and create real-time CBDC payment solutions for its citizens, the Bank of Israel is launching the Digital Shekel Challenge.
Blockchain technology will be used by German banking behemoth Deutsche Bank to improve efficiency and reduce financial industry margins in the face of falling income. With a partnership with BTG Pactual and Nubank, stablecoin issuer Circle will provide its services in Brazil with the goal of promoting the adoption of USDC and offering digital asset infrastructure to the market.
The Digital Securities Sandbox was established by the Bank of England and the Financial Conduct Authority (FCA) to help traditional financial institutions incorporate cutting-edge technologies like blockchain. Furthermore, following the FCA’s approval of the prospectuses from WisdomTree and 21Shares, the London Stock Exchange (LSE) will list cryptocurrency exchange-traded products (ETPs) for the first time.
