Bitcoin breaches $70,000 as US based pension fund reveals $100 million of Bitcoin ETF holdings
Weekly Market Update #30
Major developments for the week:
Bitcoin ETF products saw net inflows of $948.3 million last week
State of Wisconsin Investment Board bought $100m of Bitcoin ETFs
Millennium Management revealed a Bitcoin ETF holding worth approximately $2 billion as of Q1, representing 3% of their $64 billion fund
The SEC will decide on VanEck’s spot Ethereum application by May 23rd
Circle, the issuer of the USDC stablecoin, intends to relocate its headquarters to the US in preparation for a potential IPO
Deutsche Bank has joined Project Guardian to investigate applications of asset tokenization
The co-founders of Lido, along with Paradigm, have financed a restaking startup set to compete with EigenLayer
Synthetix’s sUSD depegged
The Arbitrum DAO is considering the creation of a mergers and acquisitions unit using their treasury
FantomFDN has unveiled the Sonic Network and announced plans for a token migration
LayerZero Labs has published a list of sybils
AVAX will unlock 2.49% ($347.70 million) of its circulating supply on the 22nd of May
Bitcoin ETF products saw net inflows of $948.3 million last week
ETF Flows Overview
From May 13th to May 17th Bitcoin ETFs saw varied investment flows. FBTC led with $344.5 million in inflows, peaking at $131.3 million on May 15th. ARKB followed with $243.7 million, including $133.1 million on May 14th. BITB accumulated $128.8 million, with $86.3 million on May 15th.
IBIT received $131.8 million, mostly from $93.7 million on May 16th. BTCO, EZBC and BRRR saw inflows of $22 million, $7.5 million and $29.8 million, respectively. Overall, the total net inflow for the week was $948.3 million.
As discussed in our prior weekly report, we have been keeping an eye on the notable change of Grayscales flows, which now appear to be trending consecutively positive in recent days as detailed by the graph below:
Wisconsin Pension Fund purchases ~$100m of Bitcoin ETFs
An interesting piece of BTC related news stemmed from Wisconsin last week. It was noted that in the first quarter of 2024, the State of Wisconsin Investment Board acquired 94,562 shares of BlackRock's iShares Bitcoin Trust, valued at nearly $100 million, along with additional holdings in Grayscale's Bitcoin Trust, bringing their total Bitcoin ETF investments to around $163 million.
This investment is significant as Wisconsin is the first U.S. state to make such a large-scale purchase of Bitcoin ETFs, indicating a growing institutional interest in digital assets. This move is part of a broader investment strategy that also includes holdings in other cryptocurrency-related assets such as shares in Coinbase, MicroStrategy, Riot Platforms, CleanSpark, Marathon Digital and Cipher Mining.
Meanwhile, the 14-day change of US based spot Bitcoin ETF balances has flipped positive. This indicates that ETF flows have started to pick back up.
Ethereum ETF Deadline on May 23rd
The U.S. Securities and Exchange Commission is set to make a pivotal decision on several Ethereum exchange-traded fund applications by May 23rd. This deadline is crucial for applications from major firms such as VanEck and Ark Invest.
There is significant skepticism about the likelihood of approval. SEC Chair Gary Gensler has maintained a strict regulatory stance on cryptocurrencies and Ethereum's classification remains ambiguous. Unlike Bitcoin, widely recognized as a commodity, Ethereum's status is still debated, raising concerns about possible rejection. Prominent figures in the crypto industry have predicted that Ethereum and other leading cryptocurrencies may eventually be classified as securities, complicating their regulatory landscape and ETF prospects.
Historically, the SEC has been cautious, often delaying decisions on cryptocurrency-related applications to thoroughly assess market manipulation risks and ensure regulatory compliance. Nevertheless, some analysts draw parallels with the Bitcoin ETF approval process, suggesting that persistent legal challenges and strong market advocacy could eventually lead to a favorable outcome for Ethereum ETFs.
FantomFDN has unveiled the Sonic Network and announced plans for a token migration
Last week the Fantom Foundation unveiled more details pertaining to Sonic Network. The launch of the Sonic Network marks a significant advancement, offering a new layer-1 chain with enhanced capabilities. With its native token ($S) and a sophisticated layer-2 bridge connected to Ethereum and other networks, Sonic Network aims to deliver improved performance and broader connectivity. Below is a detailed overview of the key features and initiatives associated with this project:
AVAX will unlock 2.49% ($347.70 million) of its circulating supply on the 22nd of May
Lastly, the primary unlock event of this week belongs to Avalanche in which they will release 2.49% of their circulating supply. This consists of $83.63 million for Strategic Partners, $61.95 million for Foundation, $167.27 million for Team and $41.82 million for Airdrop.
Note: The content in this weekly report has also been utilized in our weekly collaborative series with stock/crypto trading platform eToro.
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