Magnet Crypto Review | The weekly roundup of all things blockchain

Issue #42

Written by Magnet Capital | May 23, 2023 12:00:00 AM

Market Overview

As of the time of writing (Monday 5pm), the total market cap of the crypto asset market is $US1.17T, down (-1.9%) from last week.

Below is the weekly performance of the top crypto and NFT assets. 

 

News Headline Highlights

  • Tether will regularly allocate up to 15% of its net realised operating profits towards purchasing Bitcoin. These Bitcoin shall be considered on top of the minimum reserves assets that 100% back tether tokens. Based on its most recent first quarter attestation report, that would be over $200m worth of Bitcoin.
  • Circle, the issuer of the second largest US Dollar stablecoin (USDC), has ditched Treasury bills that mature after May 31st to remove risk to their $30B assets from a potential US Government default. The move included rotating ~$9B into overnight repurchase (repo) agreements.
  • Five ETF issuers filed to launch ether futures ETF on a US exchange in the last week in a race to be the first to list. Grayscale was the first issuer to act, filing on May 9 to launch the Grayscale Ethereum Futures ETF, followed by Direxion, Roundhill Investments, Bitwise and Valkyrie.
  • Digital Currency Group missed a $630m payment it was meant to shell out to its subsidiary Genesis Global Capital earlier this month, according to a May 19 update to clients shared by crypto exchange Gemini.

 Crypto Asset Project Updates

Regulation Station

  • Hong Kong has launched an e-HKD pilot programme, with 16 companies to test digital currency for public use in shops and restaurants. 16 banks and payment companies, including HSBC, Standard Chartered and BOCHK. According to a statement by the Hong Kong Monetary Authority (HKMA), six use cases for the e-HKD are being tested: online payments; payments in shops and restaurants; collecting government payouts; tokenised deposits; tokenised asset settlement and Web3 trading and clearing.
  • House Republicans Tom Emmer and Darren Soto introduced a bill to clarify the regulatory classification of digital assets and provide market certainty for innovators and clear jurisdictional boundaries for regulators.
  • US Securities and Exchange Commission (SEC) Chairman, Gary Gensler, has pushed back on criticism that the SEC has not provided useful guidance for crypto companies looking to remain in compliance with federal law. Gensler continues to believe digital asset businesses are required to conform to already existing securities laws, commenting “It’s a false narrative that they are decentralised," he said. "They tend towards centralization, and you can find a website and a team of entrepreneurs around most of these.” Magnet quick take: When it’s not just crypto industry advocates, but US Government elected officials and members of your commission commenting on the lack of clarity or guidance, maybe Gensler should take the hint…

The Weekly Deal Room

Metric of the Week

For only the fifth time in history, the average fee paid per block surpassed the block subsidy, with the last instance being at the 2017 market peak. For all five of these events, the period of high fee pressure was short-lived, and subsided after just a few days.

Source: Glassnode