DigitalX Weekly Crypto Update: Market Trends and Analysis

Market Commentary

The price of Bitcoin has continued to increase over the past week, rising to US $66,000 despite selling pressures emerging from Mt. Gox Bitcoin distributions and the German government’s recent selloff. The recent rally can largely be attributed to an optimistic macro environment and the prospect of a more crypto-friendly U.S. administration under Donald Trump, who also recently selected J.D. Vance to be his Vice President in the presidential race. Vance reportedly owns between US$100,000 and US$250,000 in Bitcoin, according to his latest federal financial disclosure. In conjunction with the recent rally, the US-based spot Bitcoin ETFs extended their seven consecutive days of inflows, recording US$422.5 million of inflows on Tuesday, the biggest single-day tally since the start of June. 

According to Bloomberg, the US-based spot Ethereum ETFs are likely to launch on 23 July. At present, the issuers behind these Ethereum ETFs are undergoing final amended registration statements before receiving the go-ahead from the US Securities and Exchange Commission to begin trading. Trillion dollar asset manager BlackRock has set its management fee at 0.25%, stating that they could “waive all or a portion” of the fee for a year after listing and for the first US$2.5 billion in assets. ETF issuer 21Shares also set a 0.21% management fee, which will be waived for six months beginning on the day the shares are listed or during the first US$500 million. Other issuers – Franklin Templeton, VanEck, Bitwise & Fidelity – are also looking to completely waive their fees until a certain time period or amount of assets under management (AUM) are attained.

In a recently published report by State Street, the Boston-based asset management and banking firm is exploring stablecoins and tokenised deposits to settle transfers on the blockchain. As part of its increasing presence in the digital asset space, CoinDesk reported that State Street Global Advisors, the investment management arm of the company, also inked a deal with digital asset investment firm Galaxy Digital to develop crypto trading products. Additionally, only six months after cutting its entire digital asset division, State Street decided to rebuild and is now planning to offer crypto custody services. 

CEO Comment

The Gap between Bitcoin and the S&P 500 has amounted to 12%, a sharp drop from last week’s 27%. This is aligned with a more bullish sentiment that has emerged post the large sell-off and reports that 36% of Mt Gox distributions has been disseminated.

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:

1. This is a great use case for tokenisation and could represent a shift if Hollywood decided to go on-chain!
2. The World Bank exploring interoperability between CBDC and faster payment systems is VERY interesting, especially in the context of Trump taking a BTC v CBDC stance.

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 to circa 56%. This is the TIME for this trade as the bullish set-up for BTC looks more promising, this gap could start to close quickly. The shift to close the gap can happen very quickly and will correlate to the next up move in BTC – the building is happening.

1. This move from Starkware is HUGE both for BTC volume and usage as well as for Starkware itself – network volume is a hidden demand pool for BTC thats not being priced in.

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

• Spot Ethereum ETFs likely to launch July 23: Sources
• BlackRock sets spot Ether ETF fee at 0.25% amid rush of S-1 filings
• 21Shares Ether ETF to waive fees for up to 6 months
• Bitcoin hits $65k shaking off Mt. Gox payout worries; XRP leads crypto rally
• Bitcoin ETFs log over $300 million in net inflows to reach record level following six-day streak
• Trump’s odds of victory hit all-time high on Polymarket after shooting
• Trump to speak at Bitcoin conference despite assassination attempt
• Kraken receives Bitcoin from Mt. Gox trustee, payouts anticipated in 7-14 days
• Coinbase unveils web app to track personal on-chain wallets
• Jack Dorsey’s hardware wallet Bitkey to integrate MoonPay for Bitcoin purchases
• German government’s Bitcoin selloff may have come to end as wallet emptied
• OKX picks Malta over France as Europe hub to comply with EU’s MiCA crypto rules: Sources
• Morgan Creek Digital to raise up to $500M for new web3 venture capital fund
• Iris Energy has committed most of Childress site to expansion of Bitcoin mining: Bernstein
• Internet Computer Protocol promotes blockchain engagement in Africa
• Crypto exchange Kraken signs sleeve sponsorship deal with Premier League club Spurs
• U.S.-listed Bitcoin miners’ share of global hashrate reached record in July: JPMorgan
• Deribit to launch Bitcoin and Ether options to bet on US election
• Uniswap Labs publicly launches wallet browser extension supporting 11 blockchains
• Worldcoin jumps over 20% with unlock for early contributors starting next week, period extended
• Polygon Labs says its ZK proving system Plonky3 is production-ready, set to integrate into AggLayer
• Japan’s Metaplanet buys additional $1.2 million worth of Bitcoin, shares surge 26%
• Standard Chartered-backed Zodia Markets to buy Elwood trading desk
• OKX wallet hits 100 protocol support as it adds TON compatibility
• Core Scientific upgraded to Buy from Neutral to reflect HPC expansion: B Riley
• Crypto custody firm Copper receives key license in Hong Kong as it expands in Asia Pacific
• Moody’s tapped for Project Guardian tokenisation risk analysis
• Bitcoin miner CIpher receives takeover offer, considers sale: Report
• Grayscale launches new decentralised AI fund

The Shift List

• BlackRock’s Larry Fink: Bitcoin is ‘legitimate financial instrument’
• BlackRock interested in participating in MakerDAO’s ‘Grand Prix’: report
• VanEck to offer Bitcoin ETN in French pension plans
• Stripe enables Bitcoin, Ether and Solana crypto purchase options in EU: report
• SEC approves Grayscale, Proshares spot Ethereum ETFs for trading on NYSE Arca

Tinkering with Tokenisation

• Partior, blockchain payment network backed by JPMorgan and DBS, raises $60M Series B
• Phillip Securities, Securitize in security token issuance for Sony movie
• Palau partners with Soramitsu on blockchain-based bond platform
• World Bank explores interoperability between CBDC and faster payment systems
• BNP Paribas, Ant collaborate on tokenised deposits
• Japanese tokenised deposit platform DCJPY starts production testing
• TradFi giant State Street mulls creating stablecoin, tokenised deposits: Bloomberg
• Crypto trading firm XBTO establishes tokenisation team to focus on real world assets

Macro and Regulatory Environment

• U.S. House fails to override Biden’s SEC veto of bill that would end controversial SEC guidance
• FTX and CFTC agree to $12.7 billion settlement following months of negotiations
• Trump chooses crypto-friendly Senator Vance as VP pick
• Blockchain friendly Roberta Metsola re-elected as EU Parliament president
• Russia reconsiders allowing cryptocurrency trading for select investors on Moscow exchange
• SEC Commissioner grilled on Bitcoin ETFs as Senators weigh  U.S. regulator nominees
• Judge sends Coinbase back to drawing board over efforts to subpoena SEC’s Gary Gensler
• SEC drops its investigation into BUSD stablecoin following probe into Paxos
• Nigeria’s SEC urged to regulate Bitcoin, Ether as commodities
• Plaintiffs file new, slimmed down complaint in class action lawsuit against Tether
• Pro-crypto Senator J.D. Vance is Donald Trump’s Vice President pick
• Hong Kong set to release stablecoin consultation results, paving way for regulation
• South Korea proposes pushing back crypto gains taxation to 2028
• Celsius to liquidate tokens, hundreds of NFTs following settlement with KeyFi founder Jason Stone
• OKX exchange exiting Nigeria due to regulatory concerns

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.