Issue #76

Written by Magnet Capital | Jan 15, 2024 11:30:00 PM

Market Overview

As of the time of writing (Monday 5pm), the total market cap of the crypto asset market is $US1.76T, up (4.3%) from last week.

Below is the weekly performance of the top crypto assets.

News Headline Highlights

Bitcoin ETF update
- The US Securities and Exchange Commission (SEC) approved 11 spot BTC ETFs to trade on the NYSE, Nasdaq and Cboe on the 10th of January. Further they approved all of them to commence trading on the 11th. This historic moment for Bitcoin did not come without some drama, after the SEC twitter was hacked and released a false approval announcement on the 9th of January (24 hours early).
- US-listed bitcoin exchange-traded funds (ETFs) saw US$800m of net inflows and US$10.8B worth of shares trade hands in their first 2 days. The following ETF providers experienced the following inflows / (outflows):
  - BlackRock $497m inflow
  - Fidelity $422m inflow
  - Bitwise $237m inflow
  - ARK $105m inflow
  - Grayscale ($579m) outflow
- As shown below, the landing page for many Bitcoin ETF providers, including BlackRock, Fidelity, Franklin Templeton and VanEck are promoting BTC in efforts to attract investors to their newly launched products.

Vanguard, Merril, UBS and others have restricted their customers from trading bitcoin ETFs, citing risks and investing ethos conflicts as reasons for the decision.
Sen. Elizabeth Warren, D-Mass., has publicly slammed the US Securities and Exchange Commission (SEC) for their decision to approve spot bitcoin ETFs. and called for anti-money laundering rules to be urgently applied to crypto. Magnet quick take - Warren has been anti-crypto forever, even hoping to run her campaign with an “anti crypto army” slogan. In her comments she states the SEC was wrong on the law, an issue that was proven not to be true after the SEC fought and lost this in US Federal Courts.

Grayscale Investments has filed for a covered call ETF that seeks to generate income from a position in GBTC. Such a product is likely to be the first of many structured products that use the spot BTC ETFs as their basis.
Circle, the issuer of USDC - the second largest stablecoin, has confidentially filed for a U.S. initial public offering (IPO). Circle did not disclose IPO details such as the number of shares it plans to sell or the proposed price range.
Genesis Global Trading, a subsidiary of Digital Currency Group, reportedly settled with the New York Department of Financial Services after an investigation uncovered anti-money laundering and cybersecurity deficiencies. As part of the settlement Genesis will pay $8m in fines and forfeit its NY BitLicense.
Livio Weng, chief operating officer of Hong Kong licensed crypto exchange HashKey, commented in a recent interview that there are about ten fund companies in Hong Kong have begun exploring the launch of potential spot crypto exchange-traded funds.

Crypto Asset Project Updates

Tether, the issuer of USDT - the largest USD stablecoins by marketcap, saw its share of the global stablecoin supply grow from 50% to 71% over the course of 2023. There are now over US$95B USDT in circulation.
Ripple plans to buy back $285m of shares in Ripple Labs (not the XRP token), putting the company at a valuation of $11 billion. “We are committing $500 [million] of cash from the balance sheet to convert RSUs and buy back shares – purchasing up to $285 [million] of equity and committing over $200 [million] to convert RSUs.” a Ripple spokesperson commented. CEO Brad Garlinghouse told Reuters that Ripple holds $1 billion in cash and $25 billion of crypto on its balance sheet. The crypto holdings are mostly XRP.
Aave, a leading decentralised lending and borrowing protocol, passed a vote (99.99% ‘yay’) to onboard PayPal's PYUSD stablecoin issued by Paxos Trust Company.

Regulation Station

An advisory committee for the Commodity Futures Trading Commission voted to submit a report, making recommendations on how the CFTC can work better towards understanding decentralised finance (DeFi) and "advance its responsible and compliant development”.
The Shanghai Municipal Tax Service, released an online report explaining levies imposed on digital currency transactions in China. The report has sparked speculation that it may signal a potential relaxation of the country’s draconian ban on crypto operations.

The Weekly Deal Room

After a quiet holiday period, the deals are back!

Tune.fm, a web3 decentralized music streaming platform & music NFT marketplace, raised $20m in a round from LDA Capital, Animoca, Mindfund and others.
SkyArk Chronincles, a triple-A game creation system and online gaming platform, raised $15m in a Seed Round led by Binance Labs.
Finoa, a crypto custodian, raised $15m in a Strategic Round co-led by Maven 11 and Balderton Capital.
Bitfinity, an EVM-compatible Bitcoin Layer 2 network, raised $7m at a $130m valuation in a round with participation from Polychain Capital, ParaFi Capital and others.
Altitude, defi loan automation tools, raised $6.1m in a Seed Round with participation from Tioga Capita, GSR and others.
Pontem, a product development studio building products with Move on Aptos and other L1s, raised $6m in a round co-led by Lightspeed, Faction.
Kasu, a decentralised platform that bridges DeFi Liquidity Providers and Real World Yield Providers, raised $3m in a Seed Round from Woodstock, Morningstar Ventures and others.
Eesee, a gamified NFT marketplace, raised $2.85m in a Private Round from SevenX Ventures, Maven11, MetaBros and others.
Particle, a leverage AMM (LAMM) protocol, raised an undisclosed amount in a Seed Round led by Polychain.

Metric of the Week

BlackRock research released a graph showing that Bitcoin is the world's best-performing asset over the last 10 years. It is incredible to see a firm with the institutional reputation of BlackRock share information such as this to their clients.

Source: BlackRock

View full post