Weekly News Digest for Apr 23-30
Market Update
Last week, the cryptocurrency market continued to exhibit a combination of bullish and bearish trends, with Bitcoin and Ethereum showing mixed signals amidst overall market fluctuations. Bitcoin attempted a price recovery but faced persistent bearish trends, with trading closing around $64,095. Ethereum mirrored this volatility, consolidating after testing key resistance levels, hinting at both potential uptrends and downward trajectories. Smaller cryptocurrencies like NEAR and BONK outperformed, recording significant upticks of 33% and 32%, respectively. Amidst these movements, market analysts and AI chatbots predicted a bullish future for Bitcoin, projecting a rise to $80K-$100K by year-end, driven by factors including the halving event and anticipated institutional investments from newly approved spot ETFs.
News of the Week
U.S. presidential candidate Robert F. Kennedy Jr. has proposed to put the entire U.S. budget on blockchain for full public transparency, allowing Americans to scrutinize every budget item at any time. He emphasizes the importance of transparency and how blockchain could enable the public to identify wasteful spending within the government. Kennedy Jr. is a pro-bitcoin advocate, viewing cryptocurrency as a means of transactional freedom and a hedge against inflation, while expressing concerns over central bank digital currencies as tools for financial surveillance.
The U.S. House has passed the REPO Act, which could lead to the confiscation of over $6 billion in Russian assets and is expected to be signed into law, potentially accelerating de-dollarization efforts by other nations. Experts like Paul Goncharoff have criticized the measure, suggesting it could be seen as blackmail by other countries and undermine the trust in the U.S. dollar. Conservative U.S. think tanks, like The Heritage Foundation, have also expressed concern that the act could weaken the dollar-dominated global finance system and have unintended economic consequences.
Cryptocurrencies offer a new form of financial and political transparency and accountability that can revitalize failing democratic structures. They enable citizens to bypass corrupt systems and facilitate free and secure financial transactions and voting processes, strengthening the checks and balances against government power. Decentralized crypto products, by promoting anti-corruption and government abuse, gain strength from public support and could become a vital check in the democratic system.
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After experiencing continuous outflows for five days, U.S. spot bitcoin ETFs saw a reversal with inflows of $59.7 million, equivalent to nearly 900 bitcoins, on Friday. Grayscale's Bitcoin Trust (GBTC) is close to dropping below 300,000 held bitcoins, reporting 304,970.43 BTC as of Monday, while Blackrock's IBIT is nearing GBTC's holdings, requiring just over 31,000 bitcoins more. Together, major bitcoin funds like GBTC, IBIT, FBTC, ARKB, and BITB control 4.09% of the circulating bitcoin supply, suggesting a potential market confidence recovery.
Tether has integrated its stablecoin USDT as a native token on The Open Network (TON), targeting the platform's 900 million Telegram users for seamless digital dollar transactions without typing crypto addresses. To promote global adoption and utilization of USDT on TON, the TON foundation has allocated 11 million TON for incentives, including yield for users and rewards for liquidity providers. Additionally, TON has optimized USDT transactions to cost only $0.10 each, encouraging more users to onboard the Web3 ecosystem.
FTX, now bankrupt, is set to auction its locked Solana (SOL) tokens, a shift from its previous fixed-price sales strategy. Recent sales of SOL tokens by FTX totaled between $1.9 and $2.6 billion, with substantial interest from large cryptocurrency companies. Figure Markets will establish a Special Purpose Vehicle (SPV) for the auction, targeting non-US and accredited US investors, as the crypto community looks forward to the possibility of discounted assets.
The New York Stock Exchange (NYSE) is contemplating a move to 24/7 operations, influenced by the always-open cryptocurrency markets and a survey indicating investor interest in overnight trading. The Financial Times revealed that the Intercontinental Exchange, NYSE's owner, is assessing member interest in weekend trading, reflecting growing demand among retail investors. While there's noted demand for continuous trading, challenges such as staffing remain a concern, with implications for how to handle out-of-hours events in the market.
The stablecoin market has reached a value of $160 billion, a height last achieved before the Terra UST crash in May 2022, with Ethena's USDE leading the surge with an 86.8% supply increase. Significant growth has occurred since the end of December 2023, with Tether (USDT) and Circle's usd coin (USDC) contributing to over 93% of the market's total value. Other stablecoins like Makerdao's DAI and First Digital's FDUSD have also seen substantial increases in supply, reflecting growing confidence in fiat-pegged cryptocurrencies.
The BRICS bloc, comprising nations like Brazil, Russia, India, China, and South Africa, along with others such as Saudi Arabia and the UAE, is considering utilizing stablecoins and central bank digital currencies (CBDCs) for its inter-member economic settlement system. Russian Deputy Foreign Minister Sergey Ryabkov mentioned that integrating stablecoins and a platform uniting the participant's financial systems were options under consideration. While traditional methods are being expedited, this initiative aims at a convenient, cost-effective, and politically neutral payment system reducing reliance on the US dollar.