A week of simultaneous opposites in crypto (2024)

Dear member,

In the fluctuating landscape of cryptocurrency markets, a measured cool-off has been observed in trading volumes. A blend of heavy regulatory pressure and market turbulence appears to be the catalyst. Yet, a silver lining appears in the unwavering faith of Bitcoin hodlers, maintaining their steady accumulation in spite of shifting tides.

An ETF trust filing by Blackrock catalyzed a minor rebound in the crypto markets. This comes as a surprise as the world’s largest asset manager filed the trust, naming Coinbase as the custodian, amidst SEC’s heavy-handed approach in suing two of the world’s largest crypto exchanges, Binance and Coinbase. Could they know something we don’t? The market is already abuzz with anticipation.

Within a single week, social media platforms under the Web3 banner raised $56m, signaling a democratizing shift in data and content ownership. In the same breath, we witnessed several sizeable fund raises, namely:

Our world is immersing deeper into the cryptoverse, as demonstrated by partnerships and initiatives connecting traditional sectors and the crypto world. Franck Muller and Bybit's partnership embodies this bridging of luxury and crypto, while Bank of China's tokenization move on the Ethereum blockchain solidifies this fusion.

Regulatory winds continue to gust, shaping the industry's terrain. China considers lifting its crypto ban, while Hong Kong encourages bank support for crypto firms. Meanwhile, in the west, the UK welcomed venture capital firm a16z’s expansion in London. UK’s Prime Minister Rishi Sunak vocally supported this move. On the U.S. front, BlackRock's Bitcoin ETF trust filing fuels market optimism, even as Binance pushes back against a lawsuit from the SEC.

As we gaze at the 2024 U.S. Presidential Election on the horizon, a report hints at the possible sway of crypto-supportive candidates. With heavyweights like Elon Musk, Chamath Palihapitiya, David Sacks, and the like throwing support to crypto-friendly Democrat presidential candidate Robert Kennedy Jr, could this be signals of a coming wind of change to the U.S. and its future stance on Web3?

Best regards from the Future,
RFTF.ai

Market Intel

30% drop in trading volumes across cryptocurrency exchanges, likely due to various factors, including regulatory crackdowns and market volatility.

Global bid and ask metric sinks by 20% in the crypto market points to paper-thin order books, suggesting that liquidity in the market is low, which can lead to high price volatility.

Tether's circulation hits all-time high of $83.35B, even as confidence in Circle, the company behind USDC, continues to shrink. Total stablecoin market cap is currently at $129B.

Bitcoin miner inflows to exchanges have reached 2021 levels, indicating a bear trend. Miners are selling their holdings, contributing to the downward pressure on Bitcoin's price.

Bitcoin hodlers continue to accumulate the cryptocurrency, despite regulatory pressures in the US. This suggests that long-term investors remain confident in Bitcoin's future prospects.

Funding Trends

Web3 social media platforms raised $56m in a week, indicating a shift towards decentralized social platforms. The funding will help these platforms offer users more control over their data and content, challenging the dominance of Web2 platforms.

Gensyn raised $43m in a Series A funding round. Riding on the rising AI narrative, the blockchain-based computing resources for AI systems seeks to scale adoption of its technology.

BoomFi raised $3.8m to develop its next-generation payment solution. The company aims to make digital payments more accessible and efficient, targeting both businesses and consumers.

Bit2Me raised $15m to expand its operations in Spain and Latin America. The funding will be used to enhance the crypto exchange’s product offerings and increase its user base.

Web2 → Web3 Immersion

Bybit partnered with luxury watchmaker Franck Muller for a co-branding initiative. The partnership aims to bridge the gap between traditional luxury markets and the crypto space.

The Bank of China tokenized securities on the Ethereum blockchain, marking a significant step in the adoption of blockchain technology in the traditional financial sector.

Celebrity chefs Guy Fieri and Sammy Hagar's tequila brand launched an NFT loyalty program. The program aims to engage customers and promote the brand using blockchain technology.

Adidas collaborated with NFT artist Fewocious to release a new sneaker collection. The collaboration highlights the growing intersection of fashion and digital art.

Puma launched Black Station, a platform for showcasing collaborations with designers and artists. The platform aims to blend physical and digital fashion experiences.

Fujitsu launched a blockchain collaboration technology to build Web3 services. The technology, built in partnership with Asian Development Bank, ConsenSys, and Soramitsu Ltd, will facilitate the development of decentralized applications and services.

Huobi launched the Mars Program, marking its entry into space exploration. The leading crypto exchange’s program aims to promote blockchain technology and its applications in space.

Regulatory Round-up

APAC

China may lift its crypto ban due to regulatory progress in Hong Kong. The move could open up new opportunities for the crypto industry in the region.

Sygnum close to obtaining a Payment Institution license in Singapore. This would allow the Swiss digital asset bank to offer the country a full suite of digital asset services.

The Bank of Thailand is moving forward with its central bank digital currency (CBDC) project. The bank has completed the third phase of the project and is preparing for a retail CBDC pilot test in Q2 2023.

South Korea is making progress in the $27B security token space, where its financial authorities are working on a legal framework to regulate security tokens, which could lead to increased adoption of the technology.

Hong Kong is reportedly encouraging top banks to support crypto firms. The move is part of a broader effort to foster the growth of the crypto industry in the city.

EU

UK recently approved crypto exchange Bitstamp and brokerage firm Interactive Brokers to join the country’s crypto register. This will allow them to offer crypto services in the UK.

Venture capital firm a16z expands to London, citing the city's favorable crypto regulatory environment. The firm believes London is a key hub for crypto innovation and talent.

International

The World Economic Forum (WEF) has outlined its plan for crypto regulations. The WEF believes that a balanced and inclusive approach to regulation could foster innovation and financial inclusion.

US

BlackRock, the world's largest asset manager, has filed for a Bitcoin exchange-traded fund (ETF) with Coinbase as its custodian amid increased regulatory scrutiny of the cryptocurrency sector. This would allow investors to gain exposure to the cryptocurrency.

Binance is fighting back against SEC’s lawsuit over alleged securities violations. The crypto exchange argues that the SEC's claims are baseless and lack jurisdiction.

The Raven Also Spotted

2024 US presidential election could be influenced by crypto, according to a report. The report suggests that candidates who support crypto could gain an edge, as the industry continues to grow and gain mainstream acceptance.

Binance's Head of Product, Teck Chia, believes that crypto wallets need to function like modern technology to attract a billion users. He argues that current wallets are too complicated for the average user, and this is hindering mass adoption of crypto.

Bloomberg Intelligence’s senior macro strategist says that the high-interest rates currently offered on US Treasury Bills (T-Bills) is sucking liquidity out of the crypto markets. He believes that this is contributing to a bear market in crypto.

Prometheum, an unknown blockchain firm, has given testimony at a U.S. House hearing about SEC compliance. The firm's co-founder, Aaron Kaplan, has drawn controversial attention in the crypto space for his comments.