Coin360 Daily Dispatch | Crypto Market Updates & Highlights | August 12, 2024

Crypto Market Update

Table of Contents

Crypto Market Movements

• Bitcoin Price Drops Below $60K Amid Institutional Pause
• Mixed Signals in Ethereum Market Activity
• Digital Asset Investment Products See $176 Million Inflows
• US Spot Ethereum ETFs Record First Net Inflows

Regulatory and Legal Developments

• SEC Delays Hashdex's Bitcoin-Ethereum ETF Decision
• Tether to Defend Against Celsius Lawsuit Over 57,428.64 BTC
• Venezuela Blocks Binance and X Amid Election Dispute
• Crypto Firms Oppose CFTC's Prediction Market Ban and SEC's DEX Rules

Country-Specific Developments

• El Salvador Secures $1.6B Investment for Bitcoin City

Crypto Exchanges and Platforms

• Binance to Convert Delisted Tokens to USDC by September 2024
• Lido DAO Integrates Axelar and Wormhole for BNB Chain
• MakerDAO Votes to Limit WBTC Exposure Over Justin Sun Ties
• Optimism Advances Native Interoperability for Layer 2 Chains
• Aleph Zero Launches Ethereum-Compatible Layer-2 Mainnet
• Euler v2 Enhances Security with $4M Investment and 29 Audits
• SushiSwap's Kashi Lending Faces $100M in Bad Debt
• Solana's Jupiter Aggregator Sees 83% Transaction Failures
• Canto Network Faces Significant Two-Day Outage
• Symbiotic Launches Devnet on Ethereum’s Holesky Test Network
• deBridge Finance Introduces Airdrop Checker Tool

Human Interest and Miscellaneous

• Anonymous User Pays $89K in Gas Fees for $2K Transfer
• Trump Returns to X; Harris Surpasses Trump in Election Odds

Bitcoin Price Drops Below $60K Amid Institutional Pause

Bitcoin's price dropped below $60K due to a pause in institutional stablecoin buying, particularly a lack of USDT inflows. Analysts noted a potential recovery if the price reclaims $60,600, though fears of a "death cross" loomed. Macroeconomic factors, such as the upcoming U.S. CPI release, could induce further volatility. Some expect a retest of $55K before any potential rise. Mining difficulty was also expected to adjust downward by 3.5%. 

Mixed Signals in Ethereum Market Activity

Ethereum's recent market activity presents a mix of signals. The burn rate dropping to its lowest levels, coupled with low gas fees around 2 Gwei, suggests reduced deflationary pressure on ETH, potentially leading to price stagnation. In contrast, market movements by large holders provide conflicting indications: an ICO-era whale moved $154 million in ETH to OKX, hinting at a possible sell-off that could depress prices further. Conversely, another whale’s purchase of $13 million in ETH suggests confidence in a potential price rebound, but analysts warn ETH must reclaim $2,700 for sustained bullish momentum. Additionally, futures market data shows a reset in leveraged positions, indicating potential for a rally if spot buying increases. 

Digital Asset Investment Products See $176 Million Inflows

Digital asset investment products have seen a sharp increase in inflows, totaling $176 million, amidst a market correction. Ethereum led the surge with $155 million in inflows, marking its strongest performance since 2021. Coinshares reported these figures, noting a recovery in total assets under management to $85 billion from a recent low of $75 billion. The uptick in trading activity, especially in exchange-traded products, indicates renewed investor confidence across global markets, including the US, Switzerland, Brazil, and Canada.

US Spot Ethereum ETFs Record First Net Inflows

US spot Ethereum ETFs experienced their first positive net inflows since inception, totaling $104.8 million for the week starting August 5. Despite a 23% price drop in Ether during August, BlackRock's iShares Ethereum Trust led with $188.4 million inflow, highlighting strong investor interest amid market volatility.

SEC Delays Hashdex's Bitcoin-Ethereum ETF Decision

The SEC has postponed its decision on Hashdex's Bitcoin-Ethereum ETF until September 30, citing the need for further evaluation. This ETF, proposed by Nasdaq, aims to blend 70.54% Bitcoin and 29.46% Ethereum, with Coinbase and BitGo as custodians. The delay reflects regulatory caution amid growing interest in cryptocurrency investment products like ETFs.

Tether to Defend Against Celsius Lawsuit Over 57,428.64 BTC

Tether plans to vigorously defend against Celsius' lawsuit seeking 57,428.64 BTC, valued at $3.3 billion, alleging fraudulent actions during Celsius' bankruptcy. Tether dismisses the claims as baseless, asserting confidence in legal proceedings to protect its interests and reassure USDT token holders of no impact. The dispute underscores ongoing legal complexities in the crypto sector.

Venezuela Blocks Binance and X Amid Election Dispute

Venezuela has blocked Binance and other platforms like X by Elon Musk amid a dispute over presidential election results. The move includes a DNS block affecting Binance's website and mobile app, prompting users to seek alternative access via VPNs. This follows contested election claims by both Nicolas Maduro and his rival, with broader implications for digital freedoms in Venezuela.

Crypto Firms Oppose CFTC's Prediction Market Ban and SEC's DEX Rules

Dragonfly, Crypto.com, and Coinbase opposed the CFTC's proposed ban on prediction markets, arguing it stifles innovation and disregards critical hedging functions. Concurrently, Coinbase criticized the SEC’s new "exchange" definition, stating it lacks comprehensive analysis, could harm decentralized exchanges (DEXs), and stifle innovation. Both issues highlight ongoing tensions between regulators and the crypto industry.

El Salvador Secures $1.6B Investment for Bitcoin City

El Salvador's Bitcoin City project has secured a monumental $1.6 billion investment from Turkish company Yilport Holdings. This investment, the largest ever in El Salvador's history, will focus on upgrading the ports of Acajutla and La Unión. The initiative, announced by President Nayib Bukele, aims to enhance logistics capabilities, stimulate economic growth through improved trade opportunities, and support the development of Bitcoin City as a hub for digital innovation and commerce. Yilport will manage these ports in partnership with El Salvador's port authority over the next 50 years, starting with modernizing infrastructure and expanding capacity.

Binance to Convert Delisted Tokens to USDC by September 2024

Binance will convert several delisted tokens to USDC, including BTG, BTCST, BTS, DNT, GRS, HEGIC, MOB, XMR, MTH, MULTI, NAV, SOLO, SPARTA, XYM, and TRIBE, starting September 2, 2024, based on average exchange rates during the Conversion Period. Users must withdraw these tokens by September 1, 2024, as withdrawals will cease thereafter. The process aims to streamline platform efficiency but requires users to monitor updates for USDC credits by March 1, 2025.

Lido DAO Integrates Axelar and Wormhole for BNB Chain

The Lido DAO has approved integrating Axelar and Wormhole to bridge staked ETH (stETH) to the BNB Chain. This move allows $23 billion in value locked with Lido to interact on BNB Chain, a top-five blockchain by total value locked. It marks Lido's first connection to a layer-1 protocol outside Ethereum, enhancing its market reach and liquidity options. Despite a dip in market share earlier in 2024, Lido remains a dominant player in Ethereum staking, capturing 28.2% of net ETH deposits.

MakerDAO Votes to Limit WBTC Exposure Over Justin Sun Ties

MakerDAO will vote on limiting WBTC exposure due to concerns about a new joint venture involving Justin Sun, which will shift WBTC custody across multiple jurisdictions, including Hong Kong and Singapore. BitGo, partnering with BitGlobal and Sun's Tron ecosystem, aims to diversify custodial locations for WBTC. Sun's involvement has raised security concerns, particularly given his past projects. Despite reassurances from BitGo's CEO, fears persist about the risks posed by this collaboration.

Optimism Advances Native Interoperability for Layer 2 Chains

Optimism is advancing a native interoperability system for Layer 2 chains like OP Mainnet, Zora, and Base. This initiative aims to unify these chains under a Superchain framework, leveraging a message-passing protocol and SuperchainERC20 token standard. The goal is seamless asset and user mobility across networks, enhancing overall blockchain usability and accessibility.

Aleph Zero Launches Ethereum-Compatible Layer-2 Mainnet

Aleph Zero has launched its Ethereum-compatible layer-2 mainnet, integrating zkOS and Arbitrum Orbit technologies. This upgrade aims to enhance blockchain privacy and transaction speed significantly. The mainnet utilizes a Substrate-based WASM layer 1 for data availability and supports the Ethereum Virtual Machine (EVM) for faster transactions, reducing block times to 250 milliseconds. The launch includes plans to introduce the zkOS privacy toolkit in Q4 to further enhance privacy features. Aleph Zero also announced a $50 million funding program to support developers building on its platform.

Euler v2 Enhances Security with $4M Investment and 29 Audits

Euler v2 has fortified its security with a $4 million investment and 29 thorough code audits from 12 leading firms, including a groundbreaking competition. This multi-layered approach, emphasizing modular architecture and advanced testing methods, aims to make Euler v2 one of the most secure decentralized lending protocols available, addressing vulnerabilities and ensuring robust protection for users' assets.

SushiSwap's Kashi Lending Faces $100M in Bad Debt

SushiSwap's Kashi Lending protocol, abandoned since 2022, faces mounting bad debt, now totaling $100 million due to accrued interest on unredeemable loans. Despite attempts to unwind positions, the platform's smart contracts continue to inflate balances without recourse for affected users. This underscores ongoing challenges in DeFi governance and the repercussions of unchecked lending practices in volatile markets.

Solana's Jupiter Aggregator Sees 83% Transaction Failures

Solana's Jupiter Aggregator reportedly saw a staggering 83% of transactions fail recently, imposing significant fees on users despite unsuccessful trades. This issue has sparked concerns about centralization, with bots and validators potentially benefiting. Despite these challenges, Solana's market showed resilience with a 33.97% price increase over the past week, reflecting ongoing investor confidence amid operational issues.

Canto Network Faces Significant Two-Day Outage

CANTO's price surged 26% following a network outage on August 10, driven by a consensus issue. Cantoscan data indicated the last transaction at block 10847517. A scheduled upgrade aims to resolve these issues by August 12, reassuring users of fund security. Despite impacting DeFi activity, CANTO's price recovered to $0.0478, marking a positive response from the market.

Symbiotic Launches Devnet on Ethereum’s Holesky Test Network

Symbiotic, a new restaking protocol, has launched its devnet on Ethereum's Holesky test network, with plans for a full mainnet release in Q3. Positioned as a competitor to EigenLayer, Symbiotic allows users to stake assets to secure third-party protocols, supporting a range of ERC-20 tokens. The protocol includes slashing mechanisms to ensure node operator integrity, attracting projects like Ethena and LayerZero.

deBridge Finance Introduces Airdrop Checker Tool

deBridge Finance has introduced its Airdrop Checker tool, enabling users to verify eligibility for an upcoming airdrop. This initiative aims to distribute 6% of its token supply to early supporters and active participants, reinforcing community engagement. Over 491,000 users are eligible, with additional rewards reserved for top JUP stakers, emphasizing early adoption and user loyalty.

Anonymous User Pays $89K in Gas Fees for $2K Transfer

An anonymous crypto user mistakenly paid 34 ETH, worth $89,200, in gas fees to transfer just over $2,200 in ETH. This incident highlights the risks of human error in cryptocurrency transactions, often referred to as "fat-finger" mistakes. Such errors are not uncommon in the crypto space, where a single misplaced decimal point can lead to significant financial losses. This incident underscores the importance of careful transaction verification to avoid costly mistakes.

Trump Returns to X; Harris Surpasses Trump in Election Odds

Donald Trump has returned to X (formerly Twitter) to release a new campaign ad. Meanwhile, Kamala Harris surpassed Trump in the 2024 election odds on Polymarket as of August 13, 2023. Harris's odds improvement suggests shifting dynamics in the election race, indicating her growing appeal or Trump's potential challenges.