Coin360 Daily Dispatch | Crypto Market Updates & Highlights | January 22, 2024

Bitcoin's Market Shifts Post ETF Approval

Bitcoin started this week with a drop to under $41,000. Following the approval of spot Bitcoin ETFs, the market has seen notable shifts. Bitcoin struggles to maintain momentum amid significant outflows from Grayscale's Bitcoin Trust (GBTC), totaling $2.8 billion. 

FTX's bankruptcy estate contributed to this by selling off nearly $1 billion in GBTC shares. Investor demand in the US has weakened, with Coinbase's premium turning negative. The selling pressure is attributed to profit-taking by short-term investors and large BTC holders, as per CryptoQuant.

Ethereum's Upgrade Encounters Delay and Market Impact

ETH has lost $2,400 while Ethereum's Dencun upgrade on testnets aims to slash gas fees and quicken transactions, encountering a minor delay due to a bug. Nethermind, an Ethereum client, resolved a critical bug, underscoring the need for diverse clients. The Ethereum Foundation reportedly sold 700 ETH, impacting the market. Ethereum's price dipped slightly, with a potential pullback to $2,000. Market sentiment is shifting towards greed, suggesting an upcoming increase in buying activity.

Alameda Research Ends Grayscale Lawsuit Amid ETF Changes

Alameda Research Ltd., linked to bankrupt FTX, has voluntarily dropped its lawsuit against Grayscale Investments, seeking to unlock shareholder value. This follows Grayscale's successful conversion of its GBTC fund into a spot ETF, resulting in large redemptions. The SEC's recent approval of bitcoin ETFs, prompted by a D.C. court ruling, has significantly impacted these events.  

Terraform Labs Files for Bankruptcy Amid Legal Challenges

Terraform Labs, creators of TerraUSD stablecoin, filed for Chapter 11 bankruptcy with reported assets and liabilities ranging from $100 million to $500 million. Actions follow legal challenges and the SEC's fraud trial delay for Do Kwon. The company faces a $40 billion lawsuit, significant price drops in LUNA, MIR, and USTC, and vows to continue operations amidst escalating regulatory scrutiny.  

"Newborn Nine" Bitcoin ETFs Gain Momentum

The "Newborn Nine" Bitcoin ETFs amassed 95,000 BTC, with AUM nearing $4 billion, led by BlackRock’s IBIT and Fidelity’s FBTC. US Bitcoin ETFs hold approximately 640,000 BTC. Hong Kong anticipates its first spot crypto ETFs by mid-year. Grayscale's NAV tightened to -0.27%, while BlackRock's iShares Bitcoin Trust recorded a -0.30% discount, reflecting shifting investor valuations and interest.

Mystery Transfer to Satoshi's Genesis Wallet

On Jan. 5, 2023, 26.9 BTC worth $1.17 million was sent to Satoshi Nakamoto's genesis wallet. The purpose remains unknown, spurring various theories. Suggestions include a tribute, debt settlement, bear market prediction, or a marketing ploy for Bitcoin ETFs. The transfer increased scarcity, leaving the crypto community speculating.  

Billionaire Sun's Major Cryptocurrency Withdrawals

Billionaire Justin Sun withdrew $60 million worth of various cryptocurrencies from Binance between Dec 18, 2023, and Jan 21, 2024. The withdrawn assets include 17,433 ETH ($43M), 68,999 AAVE ($6.7M), 656.4 billion SHIB ($6.3M), and others. Sun and other whales were observed accumulating Ethereum and likely storing assets in cold storage. 

Senator Warren Faces Crypto Community Backlash

Senator Elizabeth Warren faced criticism from the crypto community after referencing a GAO report on crypto's use in evading sanctions. The report highlighted vulnerabilities but also acknowledged traceability. Crypto leaders criticized Warren, with Coinbase's Chief Legal Officer dismissing the report's lack of analysis, and Digital Chamber CEO accusing her proposed bill of being a backdoor ban on crypto.   

Coinbase's Legal Battle Against SEC Gains Favor

Bloomberg analysis suggests a 70% chance of Coinbase prevailing over the SEC in a lawsuit alleging unregistered securities sales and unlicensed staking services. The judge's skepticism regarding the SEC's definition of "collectibles" favors Coinbase. Even if the case proceeds, Bloomberg projects Coinbase's eventual success, potentially leading to a Supreme Court review of the securities standard.  

JPMorgan CEO's Bitcoin Comments Stir Reddit Debate

JPMorgan CEO's criticism of Bitcoin on CNBC sparks Reddit speculation that he aims to drive the price down to accumulate more BTC. Redditors believe Dimon's negative remarks may be a tactic to lower prices for personal gain. The community also debates Dimon's understanding of Bitcoin and speculates about the potential impact of the upcoming halving event on BTC's price.  

Injective's Breakthrough in Gas Compression

Injective, a Cosmos-based blockchain, has introduced gas compression, reducing transaction costs to $0.0003, making it the most cost-effective layer 1 network. This positions Injective as a leader in scalability, facilitating dApps and high-frequency trading. The protocol saw a 2,700% token value increase and recently launched the Volan upgrade for enhanced user experience and scalability.  

Trezor's Alert on Potential Phishing Scam

Trezor reported a potential phishing threat following a third-party security breach, affecting 66,000 users. Breach included names, email addresses, and possible compromise of recovery seeds. Trezor warned of phishing attacks and emphasized no user funds were lost. The company proactively contacted affected customers and assured the security of its devices.  

Concentric's Security Breach Leads to Asset Drain

Concentric liquidity manager on Arbitrum was exploited for $1.8M through a social engineering attack, prompting users to revoke vault approvals. The attacker compromised the deployer's private key to mint and drain assets. A report from CertiK confirmed the funds lost. Concentric is investigating and plans to issue a post-mortem report to address the vulnerability.  

Gemini Teases Possible XRP Developments

Gemini's cryptic social media posts hint at potential XRP developments, sparking excitement in the community. Speculation arises about a possible Spot XRP ETF in Europe following Gemini's approval in France. However, XRP faces market uncertainty as a whale sent 26.8 million tokens to Bitstamp, causing price concerns. Nevertheless, some analysts remain optimistic about XRP's future.  

Ondo Finance Expands in Asia Amid Token Price Drop

Ondo Finance, a U.S.-based tokenized securities issuer, recently announced its expansion into the Asia Pacific region, opening its first office there. The company, holding nearly 40% of the global tokenized securities market, offers products like OUSG, OMMF, and USDY, providing exposure to U.S. assets. 

Meanwhile, Ondo Finance faced a 13% drop in its token price, suspected due to the sale of 20 million ONDO tokens, then bouncing back to record a 2.2% daily increase. This significant transfer led to a price slide from $0.3062 to $0.254 before recovering to $0.283, amidst a broader crypto market downturn.

Investigation into B. Riley's Financial Dealings

B. Riley, a significant investment bank, is reportedly under investigation by U.S. authorities in relation to its dealings with Brian Kahn, a CEO associated with Franchise Group Inc. Nomura, another major financial group, is involved in the probe due to its association with B. Riley but isn't the primary focus. The SEC and Nomura have not provided comments.  

Crypto Scam Operation Nets $32 Million

A scam operation has fraudulently obtained $32 million from over 42,000 victims by creating over 1,300 misleading crypto tokens. The process involves generating a token, inflating its value with fake volume, and subsequently pulling the rug to cash out. Security researchers recommend avoiding obscure tokens and utilizing multiple fraud detection tools for protection.  

Dogecoin's Surge Linked to New XPayments Account

Dogecoin surged to hit a weekly high of $0.08722 before pulling back after the creation of the "XPayments" account on X, gaining over 100,000 followers. Speculation arose that Dogecoin might be integrated into X’s payment functions, fueled by Elon Musk's interest in the cryptocurrency. Musk has hinted at potential DOGE integration, such as allowing DOGE payments for Tesla merchandise and hinting at X payment launches.

Top Altcoin Gainers and Losers

Gainers:

Siacoin SC (+2.51%)

FTX Token FTT (+0.55%)

Losers:

Sei SEI (-11.22%)

Chiliz CHZ (-10.18%)

NEAR Protocol NEAR (-9.61%)