Coin360 Daily Dispatch | Crypto Market Updates & Highlights | September 4, 2024

Crypto Market Update

Table of Contents

Market and Investment Trends

• Bitcoin Dips Below $56,000 Amid Market Sell-Off
• Bitcoin and Ether ETFs Experience Significant Outflows
• SEC Delays Decision on 7RCC’s Bitcoin ETF Proposal
• Samsung Invests in Startale Labs to Boost Blockchain Tech

Platform and Token Updates

• Polygon Transitions to New Ecosystem Token POL
• CFTC Fines Uniswap Labs for Illegal Transactions
• Penpie Hack Results in $27 Million Theft
• Trump’s World Liberty Financial Launches Governance Token

Financial and Regulatory News

• Nvidia’s $280 Billion Loss Triggers AI Token Sell-Off
• Zurich Cantonal Bank Adds Crypto Trading and Custody
• Euler Finance Launches Advanced DeFi Platform
• Solana Whale Offloads $99 Million Worth of SOL

Industry Developments and Market Reactions

• Vitalik Buterin Unblocks $470k in STRK Tokens
• Japan Considers Lowering Taxes on Crypto Holdings
• WazirX Expands INR Withdrawal Despite Cyberattack
• Riot Platforms and Bitfarms Clash Over Governance
• Mysten Labs to Launch SuiPlay0X1 Gaming Device

Bitcoin Dips to $56,000 Amid Market Sell-Off

Bitcoin fell to $56,000 before recovering to $58,000, with short-term holders suffering heavy unrealized losses as the crypto market cap dropped under $2 trillion amid a $1 trillion stock market sell-off. Meanwhile, short-term holders offloaded $36.4 billion worth of BTC in under a month. Bitcoin open interest also fell 12% in one week, and liquidations have decreased, indicating the possibility of a relief rally toward $61,000. September’s typical bearish trend and US interest rate expectations weigh heavily on the market. Wall Street rebounded following chipmakers' plunge and cooling job market data today.

Bitcoin and Ether ETFs Experience Significant Outflows

On September 3, Bitcoin ETFs saw $287M in outflows, with Fidelity's FBTC losing $162M, while Ether ETFs dropped $47M. Ethereum ETFs had previously seen $476M outflows in August due to waning institutional interest. Ethereum's CME futures trading volume also hit a nine-month low in August, dropping 31% to $20.8 billion. Meanwhile, Ethereum wallet growth outpaced Bitcoin, rising 2% to 281.7 million wallets, fueled by stablecoin use, particularly Tether, amid declining Bitcoin retail activity.

SEC Delays Decision on 7RCC’s Bitcoin ETF Proposal

The SEC extends its decision deadline for 7RCC's Spot Bitcoin and Carbon Credit Futures ETF to November 21, 2024. 7RCC plans to allocate 80% of its assets to Bitcoin and 20% to financial instruments providing exposure to Carbon Credit Futures. The proposal received one comment focusing on carbon credits' adverse effects and urging mitigation efforts.

Samsung Invests in Startale Labs to Boost Blockchain Tech

Samsung Next invested in Startale Labs to advance blockchain technology in partnership with Sony to develop the Soneium blockchain, enhancing Ethereum's Layer 2 ecosystem. The investment supports tools addressing industry challenges, strengthens Web3 infrastructure, and marks Samsung's growing involvement in the Web3 and crypto fields. 

Polygon Transitions to New Ecosystem Token POL

Polygon's transition from MATIC to the new Polygon Ecosystem Token (POL) marks the network's advancement to "Polygon 2.0." Despite a 10% decrease in value aligned with the market trend, POL's 2% annual emissions support validator rewards and the Community Treasury, ensuring network security and sustainable growth through community governance.  

CFTC Fines Uniswap Labs for Illegal Transactions

The CFTC fined Uniswap Labs $175,000 for offering illegal leveraged retail commodity transactions, violating the CEA. Their decentralized protocol allowed leveraged and margined transactions in cryptocurrencies like ether and bitcoin, non-compliant with the CEA, and conducted without the necessary registration as a contract market. Commissioner Mersinger opposed the decision, fearing it could stifle DeFi innovation and drive developers out of the US. Uniswap Labs cooperated, resulting in a reduced fine. The New York State Attorney General, Letitia James, has subpoenaed venture capital firms, including a16z and Union Square Ventures, over their investments in Uniswap. 

Penpie Hack Results in $27 Million Theft

Penpie, a DeFi protocol built on Pendle, suffered a $27 million hack. The hacker laundered $7 million via Tornado Cash within 12 hours. Pendle promptly paused contracts, safeguarding $105 million from further theft. Penpie’s native token (PNP) dropped 40%, while Pendle’s token saw an 8% decline. Despite this, Pendle resumed normal operations. The hacker exploited a contract to manipulate staking rewards, with Pendle offering negotiations for security and cooperation. The total crypto losses in 2024 surpass $1.2 billion.

Trump’s World Liberty Financial Launches Governance Token

Trump’s World Liberty Financial project is launching a non-transferable governance token (WLFI), with 70% allocated to insiders, and will use Aave and Ethereum to create a "credit account system." The platform, involving Trump's sons, faces security challenges due to links with hacked Dough Finance. Donald Trump plans to position the U.S. as a global crypto hub, supporting Bitcoin mining and criticizing current regulations. Security measures are heightened, with experts like Zokyo and Peckshield involved. Lara and Tiffany Trump's X accounts were hacked, promoting a fraudulent token linked to World Liberty Financial. 

Nvidia’s $280 Billion Loss Triggers AI Token Sell-Off

On Tuesday, Nvidia suffered a $280 billion market cap loss due to a DOJ antitrust subpoena, dropping its stock by 9.5%. This triggered a selloff in AI tokens, which fell 7.1%, surpassing Bitcoin and Ethereum's 4.3% and 4.4% declines. Fetch.ai transferred 10 million FET tokens to DWF Labs, sparking speculation and minor price surges despite a 4.47% price drop. The blockchain AI agents category saw a steeper 11.1% decline amid market downturn concerns and liquidity enhancement efforts. 

Zurich Cantonal Bank Adds Crypto Trading and Custody

Zurich Cantonal Bank, Switzerland's largest cantonal bank, has introduced cryptocurrency trading and custody services for Bitcoin and Ether. The bank will securely store private keys for customers and third-party banks. Customers can now trade cryptocurrencies 24/7 through digital platforms. ZKB has also offered its B2B solution, utilized by its initial partner, Thurgauer Kantonalbank.

Euler Finance Launches Advanced DeFi Platform

Euler Finance launches Euler v2, introducing modularity and advanced lending capabilities in the DeFi ecosystem. The platform features the Euler Vault Kit (EVK) and the Ethereum Vault Connector (EVC) to facilitate decentralized, non-custodial credit markets, allowing for the creation of highly customizable lending and borrowing vaults, advanced risk management, and reducing liquidation costs compared to v1.  

Solana Whale Offloads $99 Million Worth of SOL

So far this year, a significant Solana whale has sold over $99 million worth of SOL, offloading 695,000 tokens. The whale continues to sell an average of 19,306 SOL per week. Despite recent market volatility, Solana remains resilient, trading at $133, showing a 31% increase this year and a remarkable 585% growth over the last 12 months.  

Vitalik Buterin Unblocks $470k in STRK Tokens

Ethereum co-founder Vitalik Buterin unlocked 1.268 million STRK tokens, worth over $470k, signaling confidence in the Starknet network. With a market cap of $3.8 billion and a daily average volume of $89 million, STRK's price is showing potential for a bullish rebound, supported by its role as a top-scaling solution for the Ethereum ecosystem with a TVL of $232 million.

Japan Considers Lowering Taxes on Crypto Holdings

Japan's Financial Services Agency is contemplating taxing crypto as a financial asset, potentially lowering taxes for high-earning crypto holders. Presently taxed as income at up to 45%, a shift could see a flat 20% rate applied akin to capital gains. The move aims to enhance investment opportunities and assets for the public.  

WazirX Expands INR Withdrawal Despite Cyberattack

WazirX has accelerated INR withdrawal phase two ahead of schedule, allowing crypto users to access 66% of their balances. However, crypto trading remains suspended for an additional six months following a $230 million cyberattack. Zettai, WazirX's parent company, is seeking investor support and partnerships from 11 other exchanges to aid in recovery and cover losses.  

Riot Platforms and Bitfarms Clash Over Governance

The battle between Riot Platforms and Bitfarms intensifies as Riot criticizes Bitfarms' governance changes and proposed acquisition of Stronghold Digital, while Bitfarms defends its leadership. Tensions rise as both sides prepare for a special meeting on October 29, with Riot aiming to acquire Bitfarms and Bitfarms seeking to increase its capacity. 

Mysten Labs to Launch SuiPlay0X1 Gaming Device

Mysten Labs aims to deliver the SuiPlay0X1 handheld gaming device, integrated with the Sui blockchain, by the first half of 2025. Priced at $599, the device supports PC games, Sui blockchain games, and weighs 677 grams. With over 1,000 preorders already, payment can be made in Sui, Ether, and Solana. Expected global handheld gaming device sales are set to increase, indicating a growing market.