This week's latest trends and insights in the digital asset market from our asset management team.
Market Commentary
Digital Asset prices dropped this week with significant outflows from spot Bitcoin ETFs being recorded, despite the wider risk-on sentiment fueled by low CPI figures coming out of the US last week. Bitcoin experienced a significant sell-off from miners and notably a significant amount of selling from long-term Bitcoin whale wallets, dropping as low as US$64,000 USD before rallying back above US$65,000 off the back of positive regulatory developments out of the US. The overall hashrate has dropped, signalling a potential consolidation among miners in the aftermath of the recent Bitcoin halving. This reduction in hash rate suggests that some miners may be struggling with profitability, leading to a shakeout where only the most efficient operations remain.
In regulatory news, the SEC has decided to drop its case against Ethereum 2.0, as announced by Consensys. This decision has been met with positive sentiment in the market, as it removes a significant source of uncertainty for Ethereum investors and developers. The dismissal of the case is seen as a green light for further development and innovation within the Ethereum network, boosting confidence among stakeholders and potentially driving new investment into Ethereum and related projects.
On the political front, former US President Donald Trump has expressed support for cryptocurrencies, marking a significant shift from his earlier critical stance. Trump’s endorsement is expected to influence public perception and could lead to increased mainstream adoption and acceptance of digital assets. His support aligns with growing bipartisan interest in blockchain technology and cryptocurrencies, suggesting there could be the potential for more favourable regulatory frameworks in the future. This development is likely to have a positive impact on market sentiment and may spur further institutional and retail interest in the crypto space.
CEO Comment
The Gap between Bitcoin and the S&P 500 has widened to 19%, from 13% last week, in line with this weeks Bitcoin sell-off as we track the beta of broader markets.
As for the shift list, which we define as the major events and announcements facilitating the broader market’s transition to Web3 financial rails or the internet of value, the top shifts for this week include:
- This move by Tether is another step in the direction of real world asset tokenisation and what we call Radical Fungibility in the Web3 financial rails
Our Top “alts shifts” for this week, featuring shifts in our altcoin universe that drive our thematic approach, saw the second gap, or the broader digital asset market, drop ever so slightly to circa 52%. I want to reiterate that this is a big opportunity, as mentioned we see this as a selective opportunity to identify and grow our alternatives portfolio via our “alThematics” work. The gaps themselves are proving to be a risk on, risk off proxy and hugely high Beta – volatility is a certainty and an opportunity – the building is happening no matter what.
- Data security and privacy is probably the true gift of Web3 or “Web5” we are constantly looking for opportunities in the decentralised data space – this is an interesting project – CHIRP
What are our favourite thematics for 2024? We continue to like any infrastructure plays of the shift from Web2 to Web3 financial rails and any plays in the real-world asset tokenisation infrastructure, data validation and decentralised storage, as well as scale-up technologies such as ZKrollups. We are closely following all the ”de’s” – DeFi, DePin, DeSoc – (want to know what that means? – message us).
Lisa Wade, CEO DigitalX
CRYPTO TOP 20 7 DAY PRICE CHANGE
*All figures throughout are in USD unless otherwise specified
Market Updates
- Ether ETFs Should Be Fully Approved by September, Says SEC Chair Gensler
- Ethereum’s Pectra upgrade: Key risks identified in Report
- Crypto returns will remain muted as investors chase AI gains, economist says
- Crypto funds see $600 million in outflows while U.S. Bitcoin miners hit record-high market cap
- Crypto Trading Firm Cumberland Acquires New York’s BitLicense
- ‘Next FTX’ crypto giant Tether’s ties to terrorists, trafficking to be exposed through campaign to take down ‘
- Hashdex files for combined spot Ethereum and Bitcoin ETF amid declining market prices
- CleanSpark buys bitcoin mining facilities in $25.6 million deal
- Bitcoin NFTs Surpass Ronin with Record $148 Million All-Time Sales in Last 30 Days
- Jump Crypto Adds $10M to Industry’s U.S. Political War Chest, Raising PAC to $169M
- CertiK says it found Kraken’s bug and is transferring the funds back to the exchange
- Nomura crypto arm Laser Digital bags Abu Dhabi license
- Bitwise amended Ethereum ETF filing says Pantera interested in $100M buy
The Shift List
- First Bitcoin ETF to list on Australia’s bourse in global wave
- Tether Debuts New ‘Synthetic’ Dollar Backed by Tokenized Gold in Tokenization Push
- Iran to launch digital rial on Kish Island – Central Banking
- Telecom Giant and T-Mobile Parent Deutsche Telekom Plans to Mine Bitcoin
- MMpro Trust and Tonkeeper Launch RWA Store for Pre-IPO Investments
- El Salvador Proposes Private Bitcoin Investment Bank to Boost Economy
- National Australia Bank’s Venture Arm Invests in Crypto-Focused Zodia Custody
Macro and Regulatory Environment
- US SEC closes investigation in Ethereum 2.0, ‘major win’ for industry: Consensys
- Donald Trump vows to end Joe Biden’s ‘war on crypto’
- FSA Cracks Down on LBank Crypto Exchange
- Supreme Court Agrees To Hear Nvidia Appeal of Crypto Sales Lawsuit
- U.S. SEC’s Crypto Enforcer David Hirsch Quits
- Malaysia cracks down on crypto tax evaders with Ops Token
- Ethereum resumes downtrend as Canada sees another staked ETH ETF launch
- New South Korean law requires exchanges to regularly review token listings
- National Australian Bank Halted AUDN a Stablecoin Project
- Swiss regulator forces crypto-friendly FlowBank into bankruptcy
About DigitalX
DigitalX Ltd (ASX:DCC) is a leading ASX-Listed Bitcoin and digital asset funds management business. The Company has a 9 year track record mining Bitcoin, blockchain and smart contract development. DigitalX Asset Management is the investment manager of digital asset investment products that provide qualified investors with highly secure and streamlined access to digital asset exposure. To learn more contact the team at [email protected] or visit our website https://digitalx.fund/.
Disclaimer:
DigitalX Asset Management Pty Ltd is a corporate authorised representative (CAR) of Boutique Capital Pty Ltd (AFSL 508011), and True Oak Investments Ltd (AFSL 238184). To the extent to which this document contains advice it is general advice only and has been prepared by the CAR for individuals identified as wholesale investors for the purposes of providing a financial product or financial service. The information herein is presented in summary form and is therefore subject to qualification and further explanation. The information in this document is not intended to be relied upon as advice to investors or potential investors and has been prepared without taking into account personal investment objectives, financial circumstances or particular needs. Recipients of this document are advised to consult their own professional advisers about legal, tax, financial or other matters relevant to the suitability of this information. Past performance is not indicative of future performance.
