Issue #77

BTC becomes the second largest commodity ETF, BlackRock and Fidelity each amass over $1B of BTC & more...

Market Overview

As of the time of writing (Monday 5pm), the total market cap of the crypto asset market is $US1.70T, down (-3.7%) from last week.

Below is the weekly performance of the top crypto assets. 

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News Headline Highlights

  • Bitcoin ETF update
    • Bitcoin has overtaken silver to become the second biggest commodity ETF market. 
      • #1 Gold - ($96b)
      • #2 Bitcoin ($27.5b)
      • #3 Silver - ($11.5b)
    • After six trading days, the nine approved spot Bitcoin ETFs hold ~95,000 bitcoin, bringing the value of their assets under management to nearly $4 billion dollars. These inflows outpace the outflows from the Grayscale Bitcoin Trust (GBTC), which has experienced ~$2.8 billion in outflows over the period. In total, spot BTC ETFs now hold over $27B.
    • BlackRock and Fidelity’s spot Bitcoin ETFs (IBIT and FBTC) both received over $1 billion worth of inflows after five days of trading.
    • ProShares filed for five leveraged and inverse bitcoin exchange-traded funds (ETFs) with the US Securities and Exchange Commission (SEC). The names of the funds are ProShares Plus Bitcoin ETF, ProShares Ultra Bitcoin ETF, ProShares UltraShort Bitcoin ETF, Proshares Short Bitcoin ETF and ProShares ShortPlus Bitcoin ETF. 
    • The US Securities and Exchange Commission (SEC) has requested public comments about a proposal from Nasdaq that would allow for options trading on BlackRock's spot bitcoin ETF. The comment period will last for 21 days. 
  • Industry insiders are urging Hong Kong regulators to follow the United States’ lead in authorising spot cryptocurrency exchange-traded funds (ETFs). The city, which touts ambition to become a major virtual-asset hub in Asia, has fallen behind the US despite the Hong Kong Securities and Futures Commission (SFC) said it was prepared to authorise spot virtual asset ETFs in December.
  • China has formed a working group to push for standardization for the metaverse sector. The Ministry of Industry and Information Technology (MIIT) announced the formation of a working group with representatives from the government, academia and corporations. Members of the working group include those from Chinese tech giants, such as Huawei, Ant Group, Tencent, Baidu, NetEase and Sense Time.
  • A U.S. bankruptcy judge, Christopher Lopez, approved Core Scientific's Chapter 11 restructuring, allowing the bitcoin mining company to cut $400m in debt and emerge from bankruptcy by the end of January. Lopez commented that the bankruptcy plan "provides a tremendous recovery for both unsecured creditors and also equity holders," who usually fare poorly in bankruptcy.
  • Terraform Labs filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on Jan. 21. The company’s liabilities are estimated to be $100-$500m, and the amount of assets lies in the same range. Co-founder and former CEO Do Kwon is currently awaiting extradition from Montenegro, while his U.S. trial is set for late March.
  • The US Securities and Exchange Commission (SEC) delayed the deadline to decide on Fidelity's application for a spot Ethereum Exchange-Traded Fund (ETF). The next decision date (approve, deny or delay further) is now March 5, 2024. Magnet quick take: This was expected, per the spot BTC ETF, the SEC only approved or denied once they could not delay any further.

 Crypto Asset Project Updates

  • Ethereum core developers deployed the Dencun upgrade on the Goerli test network - serving as a precursor to its anticipated launch on the mainnet. The central feature of this Dencun deployment (on Goerli) is the introduction of EIP-4844, a novel transaction mechanism known as ephemeral blobs or proto-danksharding. This is expected to substantially lower transaction costs for Ethereum Layer 2 rollup chains.
  • Bitcoin's hash rate hit an all time high 500 exahashes/sMagnet quick take: Bitcoin is backed by the largest computer network in the world. In 15 years, Bitcoin has amassed a network orders of magnitude larger than the combined size of the clouds that Amazon, Google, and Microsoft have built.

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The Weekly Deal Room

  • Hashkey, a centralised crypto exchange, raised $100m at a $1.3B valuation in a Series A led by OKX Ventures.
  • Kiln, an Ethereum staking platform, raised $17m in a Series A+ led by 1kx.
  • Root Protocol, an web3 operating system that includes digital identity, social network, and more, raised $10m at a $100m valuation in a Seed Round led by Animoca Brands.
  • DIMO, a decentralised car data protocol, raised $11.5m in a Series A led by Coin Fund.
  • 0xScope, a Web3 analytics and investigation tool platform, raised $5m in a Series A led by HashKey Capital.
  • Renzo, a liquid restaking hub, raised $3.2m at a $25m valuation in a Seed Round led by Maven 11.
  • Canza Finance, a Web3 Innovation company focused on enabling decentralised finance in Africa, raised $3.2m in a Strategic Round led by Polychain.
  • AOFVerse, a web3 mobile gaming company, raised $3m in a Private Round from Animoca Ventures.

Metric of the Week

The number of BTC held by ETFs has increased in the first week of trading by ~30k BTC.

As evidenced in the chart below Grayscale (GBTC) has lost a market share, particularly to BlackRock (IBIT) and Fidelity (FBTC).

Source: HeyApollo

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