Bitcoin sees aggressive rally back above $60,000 as German Government finishes sales
Weekly Market Update #38
Key Takeaways:
Last week Bitcoin ETF products saw net inflows of approximately $1 billion
Goldman Sachs plans to launch three tokenization projects by the end of the year.
The German government has sold all their Bitcoin.
Ton Blockchain is set to launch a Layer 2 solution based on Polygon's CDK.
Cboe has filed 19b-4 forms for both VanEck and 21Shares Solana ETFs.
Trump's ear was grazed during an assassination attempt at his presidential rally.
Trump will speak at the Bitcoin 2024 event.
Trump chooses pro crypto VP JD Vance
Lido Finance has implemented an SSV-powered "simple DVT module."
The SEC has dropped its investigation into Paxos' BUSD stablecoin.
The SEC has dropped its investigation of Bitcoin Layer 2 Stacks and Builder Hiro.
MakerDAO's $1 billion tokenized treasury investment plan has attracted interest from multiple parties.
Last week Bitcoin ETF products saw net inflows of approximately $1 billion
From 8 July 2024 to 12 July 2024, the Bitcoin ETF flows show significant variations in flows. IBIT saw the highest total inflows with $522.5m, followed by FBTC with $358.1m. ARKB, EZBC, and HODL experienced moderate inflows of $74.7m, $31.7m, and $14.8m respectively. GBTC, however, had consistent outflows totaling -$35.3m. BTCW showed no activity with zero inflows or outflows. Overall, the total net inflow across all funds amounted to $1047.6 million.
The German government has sold all their Bitcoin
In other important Bitcoin news, The German government completed the sale of its entire Bitcoin holdings over a span of about 23 days, finishing in mid-July 2024. Initially, the government held nearly 50,000 bitcoins, valued at approximately $2.2 billion, which were confiscated by police in Saxony in January.
The selling process began in late June, involving the transfer of large batches of Bitcoin to various exchanges and over-the-counter (OTC) services. Significant transfers occurred throughout July, including a major transaction on July 11, when 10,567 BTC, worth over $600 million, were sent to exchanges such as Bitstamp, Coinbase, and Kraken, as well as to service providers like Flow Traders and Cumberland DRW.
By July 12, the government’s Bitcoin wallet was empty, concluding the sales of the confiscated bitcoin. This aggressive selling caused notable market turbulence, contributing to Bitcoin price volatility between $54,400 and $58,200.
These Bitcoins, originally seized from operators of a defunct piracy website, marked the end of the German government's direct involvement in the crypto market. The large-scale liquidation had a significant impact on the cryptocurrency market, coinciding with increased inflows into US spot Bitcoin ETFs. The below image from Arkham Intel illustrates their BTC holdings during this time period:
MakerDAO's $1 billion tokenized treasury investment plan has attracted interest from multiple parties
In other news this week, crypto lending platform MakerDAO, the protocol behind the $5 billion stablecoin DAI, is planning to invest $1 billion of its reserves in tokenized U.S. Treasury products. Top contenders for the proposal include BlackRock's BUIDL, Superstate, and Ondo Finance.
BlackRock's participation will be through its BUIDL platform, which is collaborating with Securitize, a tokenization platform. Carlos Domingo, CEO of Securitize, expressed excitement about the competition, stating, "We think this is a very good move from MakerDAO and we are excited to participate with BlackRock's BUIDL."
MakerDAO is highly profitable with over $43 million in operating earnings to date this year:
Multiple Solana spot ETF filings
VanEck and 21Shares have formally submitted applications for spot Solana ETFs in the United States. Key points include:
On June 27-28, 2024, VanEck and 21Shares filed applications with the Securities and Exchange Commission for the first U.S. spot Solana ETFs.
The Chicago Board Options Exchange (Cboe) confirmed these plans by submitting 19b-4 filings with the SEC on July 8, 2024, requesting approval to list the potential spot Solana ETFs from both asset managers.
If approved, these ETFs would directly hold SOL tokens, allowing investors to gain exposure to Solana's performance without directly owning the cryptocurrency.
Following the announcements, Solana's price increased by approximately 11% to $150.
The SEC has a 240-day window to make a decision on these products after acknowledging receipt of the filings.
Analysts predict a cautious likelihood of the approval of a spot Solana ETF within the next year, considering the SEC's evolving stance on crypto ETFs.
As displayed in this dune dashboard from 21co, SOL has exhibited the most substantial growth among the listed cryptocurrencies starting from the period of January 2023, achieving a return of 1326.12%.
The SEC drops cases against STX and BUSD
This aforementioned evolving stance on crypto currencies from the SEC was highlighted last week by the agency concluding its three-year investigation into Hiro Systems, the company behind the Stacks (STX) blockchain, without taking any action. This investigation, which began in September 2021, focused on examining Hiro's interpretation of STX's decentralization and whether the token should be classified as a security.
Just a day before closing the Hiro Systems case, the SEC also dropped a separate case involving Paxos and Binance's BUSD stablecoin. This resolution of the BUSD case preceded the conclusion of the Stacks investigation.
These consecutive decisions by the SEC to drop investigations into both STX and BUSD without taking any action are seen as significant developments in the crypto industry. They potentially indicate a shift in the SEC's approach to cryptocurrency regulation.
ARB will unlock 2.87% of its circulating supply on July 15th 2024
Lastly, Arbitrum will unlock 2.87% of its circulating supply today, a $66.92 million dollar equivalent.
For the team, future team, and advisors, 56.13 million ARB tokens will be unlocked, with a total value of $40.54 million. This represents 1.71% of the market capitalization and 1.74% of the circulating supply.
For investors, 36.52 million ARB tokens are set to be unlocked, valued at $26.38 million. This accounts for 1.11% of the market capitalization and 1.13% of the circulating supply.
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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