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

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Crypto Market Update

Table of Contents

Market and ETF Updates

• Bitcoin ETFs Spark Supply Concerns
• Ethereum's Dencun Upgrade Cuts Costs
• Ethereum ETF Hopes Fade Amid Regulatory Hurdles
• Grayscale Introduces Economical Bitcoin Exposure Option

Crypto Platforms and Investments

• CoinShares Bolsters US Presence Through Acquisition
• Starknet Rolls Out Fee-Reducing Upgrade
• Grayscale's Solana Trust Sees High Demand
• Coinbase Appeals for Clearer Digital Asset Regulations
• Monad Labs' Funding Milestone with Paradigm

Regulatory and Legal Developments

• Spain Upholds GDPR Suspension of Worldcoin
• Binance Executives Face Legal Uncertainty in Nigeria
• Thai SEC Allows Private Bitcoin ETF Investments

Banking and Economic Insights

• Dimon Supports Bitcoin Investment Despite Risks
• Tether Aids in Recovering $1.4M in Crypto Scam

Emerging Trends and Token Launches

• Toncoin Soars Following Telegram's IPO Buzz
• Meme Coin Season Downturn Indicated by SHIB Sale
• Ether.Fi Launches ETHERFI Token
• NFTfi's Growth with New Funding Round

Bitcoin ETFs Spark Supply Concerns

Before crashing to under $69,000 tonight, Bitcoin's surge to nearly $73,000 had been fueled by its comparison to gold and significant ETF inflows, despite the slower creation of millionaire wallets compared to previous bull runs. The U.S. CPI's rise to 3.2% did not deter Bitcoin's rise within the first minutes. 

A potential ETF liquidity crisis is anticipated within six months due to substantial buying trends, which could lead to a supply shortage and heightened prices. This crisis is expected to be exacerbated by continuous institutional inflows into spot Bitcoin ETFs, suggesting a pivotal moment in supply dynamics.

Ethereum's Dencun Upgrade Cuts Costs

Ethereum's Dencun upgrade, a significant change since its transition to proof-of-stake, aims to reduce fees by implementing "proto-danksharding," which introduces a new way to store transaction data, benefiting layer-2 networks like Starknet, Polygon, Arbitrum, and Optimism. It is expected to significantly lower transaction costs by allowing these networks to post data more efficiently. 

Despite Ethereum's progress, Ether put options are in demand, signaling market concerns and possible near-term price weaknesses. This cautious sentiment follows Ether's breakthrough above $4,000, influenced by uncertainties around the approval of a spot ETF by the U.S. SEC.

Ethereum ETF Hopes Fade Amid Regulatory Hurdles

Approval odds for Ethereum ETFs have significantly dropped to 35%, indicating a bleak outlook. This downturn reflects concerns over SEC's potential disapproval, given the lack of communication and previous regulatory hesitations. Additionally, the unique characteristics of Ethereum, such as its staking mechanism and pre-mined supply, further complicate its classification under current frameworks. 

Despite these challenges, some industry voices remain hopeful, suggesting that approval could still occur, albeit under uncertain timelines. The situation underscores the broader complexities and speculative nature surrounding Ethereum's regulatory acceptance and market dynamics, with predictions of bearish outcomes regardless of the SEC's decision.

Grayscale Introduces Economical Bitcoin Exposure Option

Grayscale plans to launch a smaller version of its Grayscale Bitcoin Trust (GBTC) to offer investors exposure to bitcoin with lower fees and potential tax benefits. The trust, named "BTC," will be funded with GBTC shares and aims to give shareholders an economical and efficient option for acquiring bitcoin exposure. The original GBTC's holdings have decreased significantly.  

CoinShares Bolsters US Presence Through Acquisition

CoinShares completed its acquisition of Valkyrie’s fund business, adding $530 million in assets under management, including notable ETFs like Valkyrie Bitcoin Fund and Bitcoin Miners ETF. This move expands CoinShares' US presence, aiming to rebrand the acquired funds by summer. Amid intense competition in the Bitcoin ETF market, Grayscale contemplates a spin-off for its Grayscale Bitcoin Trust to counteract $11 billion outflows, considering the launch of a "Grayscale Bitcoin Mini Trust." 

Concurrently, VanEck slashes its spot Bitcoin ETF fees to zero until 2025 to boost assets, already observing significant inflows. Bitcoin spot ETFs approach $60 billion in net assets amid surging investor interest, with significant inflows and outflows noted among key ETFs like GBTC, IBIT, and FBTC, indicating shifting investor preferences. The market's bullish trend continues as Bitcoin spot ETF reapprovals invite more institutional capital.

Starknet Rolls Out Fee-Reducing Upgrade

Starknet introduces fee-saving upgrades coinciding with the Dencun rollout to reduce transaction costs significantly. The 0.13.1 version aims to cut data availability, fixed costs, and improve efficiency, enhancing fee savings for users. Starknet's TVL stands at $1.66 billion, with further optimizations planned for SHARP shared prover system and voluntary fee reductions in the future.  

Grayscale's Solana Trust Sees High Demand

Institutional interest in Solana (SOL) is evident, with Grayscale Solana Trust trading at an 870% premium. Pantera Capital plans to buy $250 million worth of SOL at a fixed price. The token is considered undervalued by analysts and shows potential for significant gains, especially with the network's increasing traction and surges in onboarding new users.  

Coinbase Appeals for Clearer Digital Asset Regulations

Coinbase is appealing the SEC's refusal to establish new regulations for digital assets. The exchange claims the SEC's enforcement approach leaves companies in a difficult position due to unclear rules. This appeal is part of a larger conflict with the SEC, including a lawsuit in New York. The outcome of this motion is pending.    

Monad Labs' Funding Milestone with Paradigm

Paradigm is leading a $200 million funding round for Monad Labs at a $3 billion valuation, making it the largest crypto fundraising event of 2024 so far. The interest in funding signifies investors' enthusiasm for crypto ventures. Former Jump Crypto members co-founded Monad, with Paradigm in discussion with potential investors since late 2023.  

Spain Upholds GDPR Suspension of Worldcoin

Worldcoin's injunction request against Spain's AEPD was denied, upholding a temporary suspension under GDPR due to concerns about biometric data and minors' rights. The Madrid High Court ruled in favor of the AEPD, citing public interest and potential risks to individuals. Worldcoin's cessation of operations in Spain will last up to three months.  

Binance Executives Face Legal Uncertainty in Nigeria

Despite Binance exiting Nigeria, executives Tigran Gambaryan and Nadeem Anjarwalla remain detained in Abuja since Feb. 26. Nigerian officials allegedly seized their passports after discussions on crypto regulations. Binance suspended naira services following the arrests. Families seek information on potential charges. U.S. and U.K. officials have visited them amidst ongoing uncertainties.  

Thai SEC Allows Private Bitcoin ETF Investments

The Thai SEC has amended rules to allow local asset management firms to set up private funds for investing in spot Bitcoin ETFs traded on U.S. exchanges, catering to accredited investors only. This comes amidst Bitcoin's all-time high, with the cryptocurrency trading at $71,949, marking a 49.87% gain in the last 30 days. 

Dimon Supports Bitcoin Investment Despite Risks

Jamie Dimon, JPMorgan CEO, defends the right to invest in Bitcoin despite personal reservations, amid Bitcoin's price surge to over $72,000 and inflation concerns with CPI in the U.S. accelerating to 3.2% annually. He suggests the Fed delay interest rate cuts until year-end, wary of persistent inflation. Meanwhile, he predicts a 65% chance of a global recession, criticizing Bitcoin for illegal uses, yet upholding investment freedom. This stance reflects his cautious approach to economic policies and cryptocurrency investments.

Tether Aids in Recovering $1.4M in Crypto Scam

The U.S. DOJ and FBI, with Tether's assistance, recovered $1.4 million in USDT from a customer support scam. Funds targeted the elderly, stolen through fake tech support aiding in transferring assets to unhosted crypto wallets. Investigation ongoing, transactions traced to five wallets linked to wire fraud scheme. 

Toncoin Soars Following Telegram's IPO Buzz

The potential IPO announcement by Telegram's CEO Pavel Durov has led to a surge in Toncoin's price, reaching a two-year high. Telegram's growing user base and revenue, nearing profitability, align with Durov's intention to keep the platform independent through an IPO. Additionally, the integration of Toncoin in ad revenue and the upcoming launch of Notcoin contribute to the cryptocurrency's momentum.  

Meme Coin Season Downturn Indicated by SHIB Sale

Early SHIB investor sells $10.6M of SHIB, suggesting meme coin season may be waning. Whales move billions of SHIB and PEPE to exchanges, provoking profit potential. SHIB and PEPE witness significant rebounds after recent highs. SHIB investor owns 2.6 trillion SHIB (worth $85.15M), indicating hefty profit margins in meme crypto trading.  

Ether.Fi Launches ETHERFI Token

Ether.Fi introduces new token ETHERFI on Binance Launchpool, starting March 14. Launchpool offers staking for ETHFI with rewards in various pairs. Total ETHFI supply capped at 1 billion. Initial circulating supply at 115.2 million. Liquid restaking protocols like Ether.Fi leverage Ethereum's proof-of-stake for additional yield, attracting traders seeking rewards and airdrops.