DigitalX Weekly Crypto Update: Market Trends and Analysis

Market Commentary

The price of Bitcoin continued to trade flat during the week, with U.S. lead economic indicators continuing to fall, with a reported 818,000 less jobs created than originally estimated. Despite the recent macroeconomic impact on markets, the Republican and Democrat parties continue to promise a more crypto-friendly policy stance. Top Republicans continue to retain hope that digital asset legislation could be completed this year, while a senior campaign adviser to Democratic presidential nominee and current VP Kamala Harris has stated that Harris wishes to ‘support policies to help digital assets grow’. However, this may be surprising to many after the Democratic party failed to address digital assets at the recent national convention and declined to speak at the recent Bitcoin conference in Nashville. As a result of this political uncertainty, market sentiment continues to remain low as the US based spot Bitcoin ETFs saw the lowest daily trading volume since early February 2024. On the other hand, BlackRock continues their dominant streak in the digital asset space, now surpassing Grayscale’s Bitcoin ETF in assets and becoming the first Ethereum ETF to cross $1B in net inflows with ETHA.

Following Hashdex’s postponed application, Franklin Templeton filed an S-1 form for a ‘Crypto Index ETF’ with exposure to both Bitcoin and Etheruem. This comes after Franklin Templeton CEO Jenny Johnson said traditional finance is underestimating the size of Bitcoin, referencing its transaction volume doubling Mastercard and Visa combined in 2023. The ETF, dubbed the Franklin Crypto Index ETF trading under the ticker EZPZ, would initially hold a yet-to-be-determined allocation of BTC and ETH weighted by market capitalisation of each asset. The proposed fund will use Coinbase as its digital asset custodian. According to the S-1 filing, additional digital assets are allowed to be added in the future, amid regulatory approval from the SEC. 

State Street also announced an agreement with Taurus during the week to provide digital asset custody and tokenisation services. The US$4 trillion asset manager, seeks to tap the Taurus platform to automate the issuance and servicing of digital assets, including digital securities and funds management vehicles. The move will see State Street leverage three of Taurus’ products including custody solution Taurus-PROTECT and Taurus-CAPITAL for streamlining the process of creating and managing tokenised assets throughout their lifecycle. State Street will also utilise Taurus-EXPLORER, providing blockchain connectivity to dozens of different blockchain protocols to allow for a more interoperable ecosystem for offered tokenised real-world assets. The tie-up will allow State Street to hold clients’ crypto assets and help them create tokenised assets, such as funds and other securities. Due to U.S. regulatory hurdles, State Street will initially focus on tokenisation rather than crypto custody, with the first tokenisation client to be named following the launch of the service.

 

CEO Comment

The Gap between Bitcoin and the S&P 500 has remained flat at 16%, same as last week.

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. Embedded in this Franklin Templeton article is a GAME CHANGING piece right at the end. They’re filing for a digital asset ETF with the SEC – all eyes will be on the portfolio and progress of the application.
2. Blockchain Bali week has proven to be interesting with the  Indonesian Government revealing they are establishing their own layer 2 chain, Mandala on Polkadot and are supporting a plethora of innovations, the most notable being a government supported Digital ID project.

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… circa 68%. The TIME for this trade is 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 is an INCREDIBLE move for a RWA use case – Colorado Church group. Property and tokenised funds are becoming the standout killer use case for RWAT with bonds coming close.

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

• Institutions are still buying Bitcoin ETFs, Bitwise says
• TradFi underestimates Bitcoin’s enormous scale, Franklin Templeton CEO says
• BlackRock’s ETHA becomes first Ethereum ETF to cross $1B in net inflows
• US spot Bitcoin ETFs see lowest daily trading volume since early February
• Ethereum dominance shrinks as Bitcoin gains more ground since cycle low: Glassnode
• BlackRock’s ETFs surpass Grayscale’s in assets, crowning new crypto fund king: Arkham
• Cantor Fitzgerald CEO to co-lead Trump transition team
• U.S.-listed Bitcoin miners have the upper hand over unlisted peers: Bernstein
• Bitcoin miner Bitfarms to buy rival Stronghold Digital for $175M in stock, debt 
• SEC approves first leveraged long MicroStrategy ETF
• Two-thirds of institutional Bitcoin ETF holders held or bought more in Q2
• Marathon Digital buys $249M Bitcoin, reserves reach 25K BTC
• Solana ETFs will not see significant demand – Sygnum research head
• Latin American exchange Bitso taps Coincover for security services
• Immutable taps Fireblocks to help game developers manage digital assets
• Chainlink’s data streams and VRF are now live on Base
• Stablecoin supply growth isn’t eating into crypto market share: JPMorgan
• MakerDAO stops new WBTC-backed loans following its BitGo concerns
• Uniswap Las announces $2.35 million auditing competition, the ‘largest in DeFi history’
• OKX brings Solana ‘blinks’ to Ethereum chains
• Coinbase shifts focus back to Europe after return to Hawaii

The Shift List

• Gift card giant Raise partners with WalletConnect on crypto payments option
• World’s third largest public pension fund buys $34M MicroStrategy shares
• USDC to embrace tap-and-go payments after Apple opens up NFC
• Franklin Templeton files S-1 for ‘Crypto Index ETF’ holding BTC and ETH, following Hashdex
• Germany’s Information Security Office champions hardware wallets
• Malaysia adopts Worldcoin for personal verification and digital ID
• Crypto ETF issuer Bitwise moving into Europe via acquisition
• Moody’s, Elliptic join forces for enhanced VASP risk screening
• Second Solana ETF approved in Brazil

Tinkering with Tokenisation

• AgriDex is tokenising trades for agriculture firm Parrogate
• Parfin, one of the DREX CBDC developers, raises $10 million funding
• Colorado Church group tokenises $2.5M chapel
• State Street and Taurus team up for digital asset custody and tokenisation services
• ECB to hold workshop on B2B payment innovations, including stablecoins, tokenised deposits
• Hamilton Lane private equity secondary fund tokenised by Securitize
• Tether plans to develop UAE Dirham-pegged stablecoin alongside Phoenix Group
• Latin American e-commerce Giant Mercado Libre launches U.S. dollar-tied stablecoin
• MakerDAO securer Chronicle launching RWA oracle via M^0 integration

Macro and Regulatory Environment

• U.S. leading economic indicators continue to fall, no longer signal recession
• U.S. added 818,000 fewer jobs than reported earlier
• RFK Jr. expected to drop out of race by end of week, plans to endorse Trump: Sources
• Top Republican retains hope U.S. crypto legislation can get done this year
• Donald Trump holds over $1M in Ether, also receives NFT licensing fees
• The SEC rejected CBOE’s 19b-4 filings for Solana ETFs: Source
• VP Kamala Harris to ‘support policies’ to help digital assets grow, senior campaign adviser says: Bloomberg
• Crypto missing from Democrats party platform as national convention kicks off
• Crypto-backed candidate Ansari narrowly wins Arizona primary by 39 votes
• SEC Chair Gary Gensler is being considered for Treasury Secretary: report
• Binance completes registration with India’s financial intelligence unit months after being fined
• IMF execs float raising crypto mining electricity prices by 85%
• Iran is giving $24 to anyone who reports illegal crypto miners
• Australian regulator claims 58% of crypto ads on Facebook are scams
• Australian securities regulator nabbed more than 600 crypto investment scams in a year
• Nigeria’s tax watchdog proposes comprehensive crypto bill
• Coinbase, KuCoin, others file crypto license applications in Turkey
• Texas senator discloses up to $100K in BTC after blockchain endorsement
• Bybit receives VASP, card operator registration in Argentina
• NYSE, NASDAQ withdraw 3 more requests for crypto ETF options rule changes
• Hong Kong lawmaker calls for legal framework to regulate DAOs following Mantra’s court case
• Nigeria planning to present law to tax crypto by September: Report
• Malaysian authorities arrest seven individuals for power theft linked to Bitcoin mining: report
• Dubai court recognises crypto as valid salary payment: Law Decoded
• Solana’s former top decentralised crypto exchange faces SEC securities violation
•  Nigeria plans to introduce crypto licensing process: Bloomberg
• German regulator seizes 13 crypto ATMs
• Nearly half of all corporate election spending in 2024 cycle comes from crypto companies, study finds
• Malaysian authorities destroy over 900 Bitcoin mining rigs amid power theft crackdown

 

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.