This week's latest trends and insights in the digital asset market from our asset management team.
Market Commentary
Following last week’s strong price action from Bitcoin, the price has continued to remain relatively stable after regaining the US $68,000 mark driven by positive U.S. election predictions and how it might impact the digital asset space. Despite selling pressures as a result of the Mt. Gox distributions, Joe Biden’s announcement to drop out of the 2024 US presidential race has recently impacted the likelihood of a crypto-friendly administration entering the White House. However, despite calls for unity from advocacy groups such as the Chamber of Digital Commerce, the Democratic Party continues to treat the digital asset industry in an unfavourable manner, with recently endorsed Democratic candidate Kamala Harris refusing to speak at the upcoming Bitcoin conference in Nashville, Tennessee. This week, BlackRock’s IBIT Bitcoin ETF drew US $526M in net inflows – the highest single-day inflow since March. The US-based Bitcoin ETFs did however break a 12-day inflow streak on Tuesday as investors withdrew net US $78 million, data from SoSoValue shows.
The US-based spot Ethereum ETFs received approval for listing this week and began trading on Tuesday. The U.S. Securities and Exchange Commission approved registration forms from 21Shares, Bitwise, BlackRock, Fidelity, Franklin Templeton, VanEck and Invesco. According to Bloomberg, investors traded over US $1 billion worth of shares on the first day of their availability – roughly 20% of the trading volume that the spot Bitcoin ETFs experienced on their launch back in January. Of this amount, there was a net inflow of US $106.7 million, according to a data from SoSoValue.
Earlier this week, BlackRock’s BUIDL product crossed US $500 million – a historic milestone never before reached by the tokenised money market fund, with a current total market cap of US $1.8 billion. Securitize CEO Carlos Domingo thinks this trend will continue to dominate, stating that the tokenised treasury market “is definitely growing way faster than stablecoins”. Domingo also thinks that BUIDL will potentially hit its next US $500 million milestone in just a few months, as “every single asset manager out there is thinking about how they can participate”, he told Blockworks. According to rwa.xyz, Franklin’s Templeton’s fund, FOBXX, which was launched in April of last year, has topped US $400 million – a 16% increase over the past 30 days.
CEO Comment
The Gap between Bitcoin and the S&P 500 now sits at 9%, continuing to narrow from last week’s 12%.
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:
- The Ethereum ETF launch wasn’t quite as huge as the Bitcoin ETF’s however there was still a huge shift in Web2 to the Web3 shift – Staked ETH products will hopefully be next.
- The Bitcoin conference in Nashville is fast approaching with former US president Donald Trump set to speak.
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.
- LINK – continues to integrate at a rapid rate, we believe integrations for funds and proof of reserves is a killer use case to shift finance.
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 ETF volumes top $1B on day one
- Mt. Gox customers to receive crypto assets after 10-year wait
- BlackRock’s IBIT records biggest inflow day since March at $523M
- Grayscale lowers planned fee for ETH fund, undercutting peers
- Bitwise to donate 10% of spot Ethereum ETF profits to open-source developers
- Bitcoin mining stocks add billions to their market caps over the past two weeks
- Galaxy buys almost all of CryptoManufaktur’s assets, expanding Ethereum staking portfolio
- Grayscale announces plans for Bitcoin ETF spinoff
- Payment platform Mercuryo integrates crypto on-ramp with Indonesian banks
- Ryan Selkis quits as Messari CEO following inflammatory tweets
- BitForex to open for withdrawals following Chinese police investigation
- New zero energy storage tech could lead to immortal blockchains
- Binance.US gets greenlight to invest customer assets in Treasury bills
- KPMG to help US crypto firms uphold reporting standards
- Bitrue Ventures launches Web3-focused $40M investment fund
- Swan Bitcoin drops IPO plan, cuts staff and will shut managed mining unit
- Bitcoin miner HIVE Digital to build 100 MW crypto mining facility in Paraguay
- Two Animoca Brands subsidiaries partner with TON Foundation
- Hong Kong to launch Asia’s first inverse Bitcoin ETF
- Crypto-friendly bank Revolut plans to sell $500M of employee shares at $45B valuation: WSJ
- Coinbase upgraded to buy from neutral on improving regulatory risk: Citi
- U.S. government moves $4M Bitcoin to Coinbase, Arkham data shows
- dYdX explores sale of derivatives trading arm
- Nansen launches industry-first Ether ETF analytics dashboard
- Dakota emerges from stealth to provide bank-like services to crypto depositors
- Ferrari to extend cryptocurrency payments to Europe: Reuters
- Hex Trust receives in-principle approval from Singapore’s MAS for major payment institution license
- Bitcoin rewards app Fold to go public on NASDAQ via SPAC deal
- Polymarket clinches MoonPay payments partnership amid US election betting frenzy
The Shift List
- Spot Ethereum ETFs get final sign off to begin trading Tuesday
- EU markets will pave the way for the first Ether staking ETF: dYdX CEO
- Hashdex plots ETF that would hold both BTC, ETH
- HK bank supports nation’s regulatory goals with reserve services
- Thailand distributing digital money to 45M citizens to boost economy
- Bitcoin investment fund opens doors to EU citizenship
Tinkering with Tokenisation
- Tokenised treasuries are ‘growing way faster than stablecoins’: Securitize CEO
- Italy’s top banks participate in 25M Euro digital bond issuance on Polygon in ECB trial
- BlackRock’s $500M tokenised fund pitches for Ethena’s RWA investment plan
- Coinbase Asset Management plans tokenised money-market fund, a hot area after BlackRock’s BUIDL success: Sources
- Animoca, Standard Chartered team up in HKMA stablecoin sandbox
- Kazakhstan pays for rail line to China using programmable CBDC
- Australian stablecoin startup Stables expands to Europe and UK
- Chainlink’s tokenisation sandbox cuts trials to days instead of months
- Tokenised asset manager Superstate debuts new fund to profit from Bitcoin, Ether ‘carry trade’
- Crypto exchange Woo X allows daily interest withdrawals from T-Bill backed earn vaults
- ECB DLT trials: LBBW’s Berlin Hyp to issue €100m mortgage bond from SWIAT DLT
- Nomura-backed Libre expands fund tokenisation to Solana with Hamilton Lane
- Mitsui tokenised gold startup eyes coin distribution in Korea
- AgriDex settles first agricultural trade on Solana blockchain
- Chinese e-commerce giant JD to issue first HKD stablecoin on public blockchain
Macro and Regulatory Environment
- Biden drops out of 2024 presidential election, endorses Kamala Harris as Democratic nominee
- Harris VP short list shows mixed support for crypto issues
- EU release crypto-asset classification tools to help firms comply with MiCA
- U.S. House passes crypto illicit finance bill that’s likely to be rebuffed in Senate
- Trump quashes reports on Jaime Dimon and Larry Fink as his Treasury Secretary
- The Digital Chamber presses Kamala Harris to take positive approach to crypto ahead of elections
- WazirX files police complaint after $230M hack, engages with India’s cyber crimes unit
- South Korea’s strict laws on crypto exchanges come into force
- Greek gov’t to impose crypto taxes starting 2025
- India keeps controversial crypto tax rules unchanged, Finance Minister’s budget speech
- Crypto exchange Gate.io exits Japan
- Coinbase files motion to compel the SEC and Chair Gensler to hand over documents related to its case
- Digital assets and AI could have a ‘symbiotic relationship’ in the future, says Majority Whip Emmer
- Pro-crypto group Fairshake becomes largest super PAC of election cycle, raising over $200 million
- Senator Cynthia Lummis releases report attacking Biden’s mining tax
- Russian Parliament approves crypto use for trade and mining
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:
The information in this document is prepared by DigitalX Asset Management Pty Ltd (ACN 629 653 121) (DigitalX).
DigitalX is a corporate authorised representative (CAR) (CAR No. 1270748) of Boutique Capital Pty Ltd (AFSL 508011) and True Oak Investments Ltd (AFSL 238184). Boutique Capital is the Trustee of the DigitalX Fund and the DigitalX Bitcoin Fund. True Oak Investments is the Trustee of the DigitalX Asset Reference Token Fund (DxART). All three funds are open to wholesale investors only.
DigitalX is also a corporate authorised representative (CAR) of K2 Asset Management Ltd (ABN 95 085 445 094 AFSL 244 393) (K2), a wholly owned subsidiary of K2 Asset Management Holdings Ltd (ABN 59 124 636 782). K2 is the Responsible Entity and Issuer of the DigitalX Bitcoin ETF (ASX: BTXX) (ARSN 650 945 216) which is open to retail investors. Offers to invest in the DigitalX Bitcoin ETF (BTXX) will only be made in the product disclosure statement (PDS) and this material is not intended to substitute the PDS which outlines the risks involved and other relevant information. You should also consider the Target Market Determination (TMD) issued when ascertaining if the product is appropriate for your needs. A PDS & TMD for BTXX can be obtained at https://www.digitalx.com/funds/bitcoin-etf/. You should consider the PDS & TMD before making a decision to acquire an interest in BTXX.
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.
