Bitcoin Weekly Update #7
$500 billion investment bank launches Bitcoin fund as crucial information revealed around Mt. Gox
Dear readers, hope you’re doing well and having a great week thus far.
Major Crypto Developments for the week:
Japanese $500 billion investment bank Nomura launches Bitcoin fund for institutional investors
Two major crypto conference took place this week with Mainnet in New York City and Token 2049 in Singapore
Mt. Gox Bitcoin trustee pushes back the release of the $3.7 billion of Bitcoin to 2024, while the US government still supposedly going to sell Bitcoin seized from Silk Road
Michael Saylor’s MicroStrategy purchases an additional 5,445 BTC for ~$147.3 million
Genesis, crypto trading desk owned by Digital Currency Group, has ceased all operations
Ethereum flips slightly inflationary amidst fee drought and decline in network activity
Annual settlement volumes of stablecoins near that of payment giant Visa according to CoinMetrics
Native USDC is now live on Near Protocol and Polkadot
Unibot has integrated friend-tech, allowing users to trade keys without a FT account
Japanese investment bank Nomura launches Bitcoin fund for institutional investors
This week it was announced that $500 billion Japanese investment bank Nomura has launched Bitcoin fund for institutional investors. The fund, named the Bitcoin Adoption Fund, will be structured through the firm’s subsidiary Laser Digital Asset Management. To secure the fund’s assets, Laser will use Komainu, which was founded in 2018 by Nomura, Ledger and Coinshares and delivers a crypto custody solution for institutional digital asset investors. The firm’s Head of Distribution Fiona King stated, “We’re delighted to now launch our Bitcoin adoption fund, which allows institutional investors a secure path into digital asset investment that is backed by established finance, with the highest levels of risk management and compliance.”
Mainnet took place in New York City while Token 2049 took place in Singapore
Last week two major crypto conferences took place: Mainnet in New York City and Token 2049 in Singapore, hosting over 13,000 attendees combined. These events are a reminder that there is still a tremendous group of hard-core believers in digital assets that continue to build, innovate, and allocate capital across the industry despite the bear market. Both conferences offered numerous discussions/presentations on topics from DeFi trends, regulatory developments, and potential future use cases for digital assets. One of the most interesting presentations came from Castle Island Ventures and CoinMetrics’ Nic Carter. In Nic’s presentation, he explained how stablecoins have clearly established themselves as one of the clearest use cases of crypto, mirroring the rise of Eurodollars. One of the most compelling charts from Nic’s presentation is shown below, comparing the annual settlement volume of stablecoins relative to other large payment and settlement networks. According to CoinMetrics’ data, the annual settlement volume of stablecoins is nearing parity with payment giant Visa.
Source: CoinMetrics, Nic Carter
Mt. Gox Bitcoin release moved back to 2024, US government still supposedly going to sell Bitcoin seized from Silk Road
This week it was revealed in a statement (shown below) that failed Bitcoin exchange Mount Gox’s trustee Nobuaki Kobayashi has officially pushed the deadline for paying back the exchange’s creditors 1 year from Oct. 31, 2023, to Oct. 31, 2024.
Source: Mt. Gox Trustee Website
Years ago, Mt. Gox once held the status of serving as the largest Bitcoin exchange in the world, until it was ultimately compromised and exploited in 2014, resulting in over 800,000 BTC being lost. Today, the trustee holds ~138,000 BTC worth $3.7 billion, shown in the chart below. While this supply will ultimately be released one day, it appears this will not take place for at least another year.
Source: Glassnode
Meanwhile, the US Government still holds over 210,000 BTC worth $5.6 billion seized from both the Silk Road as well as the 2016 Bitfinex exploit. After liquidating 9,800 BTC in March, the United States government stated that it intends to sell a further 41,490 BTC in 4 tranches throughout the year. Now nearing October, assuming this is still the case without any further clarity from the govt, this is still a roughly $1 billion supply overhang to be wary of for the Bitcoin market.
Source: Glassnode
Michael Saylor’s Microstrategy purchases an additional 5,445 BTC for ~$147.3 million
This morning Michael Saylor and his software firm Microstrategy announced that the company had purchased an additional 5,445 Bitcoin for ~147.3 million. The company now holds 158,245 Bitcoin acquired for ~$4.68 billion, bringing their cost basis to $29,582 per Bitcoin. The pie chart below, from NewHedge, illustrates some of the largest publicly known Bitcoin holdings across major public and private companies/organizations:
Source: NewHedge
Meanwhile, the leading crypto asset continues to trade below its 200-week moving average.
Source: TradingView
Ethereum flips inflationary amidst fee drought
Ethereum supply tracker ultrasound.money reveals that Ethereum’s supply dynamics have shifted slightly inflationary over the last 30 days. This reflects a declining demand for usage of the network, represented by transaction fees. One of the biggest drivers of fees throughout the year has been on-chain speculative mania dubbed “on-chain summer” by crypto market commentators. This included the rise of several memecoins and other grassroots projects that were only tradeable through on-chain exchanges. The chart below shows the spike in activity on decentralized exchanges earlier this year, that has retraced entirely. With 1 week left in the month, September is set to be the lowest level of DEX volume since late 2020 when DeFi originally launched.
Source: Dune Analytics
However, in total ETH has now burned 4.3 million ETH after its EIP-1559 upgrade and shift to a proof of stake consensus mechanism late last year.
Source: Glassnode
Thanks! 🙏