Coin360 Weekly Dispatch | Crypto Market Updates & Highlights | December 14 - December 20, 2024

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Crypto Weekly Recap

Bitcoin:

• Weekly performance: -2.95%
• US Spot BTC ETFs: +$726.19M
• BTC hit a new ATH above $108K but quickly dropped to $102K.
• Early in the week, adoption remained strong:
  • MicroStrategy joined the Nasdaq-100 due to its BTC strategy.
  • Digital asset investment products saw $3.2B inflows, marking 10 straight weeks of positive flows.
  • New BTC acquisitions included:
    • MicroStrategy: 15,350 BTC ($1.5B)
    • Riot: 667 BTC ($67.4M)
    • Semler Scientific: 211 BTC ($21.5M)
    • MARA: 15,574 BTC ($1.53B)
    • Hut 8: 990 BTC ($100M)
  • Metaplanet issued zero-interest bonds to increase Bitcoin reserves.
• After the FOMC meeting, the market crashed due to FUD and profit-taking by mid-term holders.
• On Wednesday and Thursday, BTC faced pressure from Powell’s hawkish comments (despite a 25 bps rate cut), El Salvador’s IMF deal, BlackRock’s doubts over BTC’s 21M supply, and rumors of MicroStrategy pausing BTC purchases in January.
• Amid the FUD, US spot BTC ETFs recorded a record daily outflow of $680M.
• BTC fell further to $92.5K, wiping out weeks of gains for BTC and altcoins.
• Meanwhile, good news came back again:
  • El Salvador bought 11 BTC a day after finalizing its IMF deal.
  • France’s second-largest bank, Groupe BPCE, prepared to offer Bitcoin access to 35 million users.
  • The SEC approved the first hybrid Bitcoin-Ethereum ETFs from Hashdex and Franklin Templeton.
• Sustaining the price above $95,000 is crucial; if this support holds, there is potential for a rally above $100,000 if market sentiment remains positive.
• Traders are increasingly betting that the Federal Reserve will pause rate cuts in January and are placing more bets on a rate cut in March. Another rate cut is also expected in October.

Ethereum:

• Weekly performance: -10.05%
• US Spot ETH ETFs: +$137.85M
• ETH dropped to $3,125 in Friday's crash after failing to break $4K, briefly recovering to $3,430.
• World Liberty Financial accumulated ETH heavily this week, most recently buying 759.36 ETH ($2.5M).
• Ethereum investment products recorded $1 billion inflows for the seventh consecutive week, totaling $3.7 billion.
• Ethereum whales increased holdings to 57.35% of the total supply, the highest ever recorded.
• Mid-tier wallets (100–100K ETH) dropped to a record low of 33.46%, while small wallets (<100 ETH) fell to a near four-year low of 9.19%.
• Ethereum ETFs have seen significant inflows in December 2024, totaling $1.66 billion, which represents 74% of the $2.24 billion total since inception. BlackRock's Ethereum ETF surpassed 1 million ETH holdings.
• Ethereum validators supporting a gas limit increase rose to 10%, aiming to raise the limit to 36–40 million and potentially reduce layer-1 fees by 15–33%.
• New layer-2 chains launched or prepared to launch include Deutsche Bank’s L2, ENS Namechain, HashKey Chain, and Kraken’s Ink.
• Polymarket users bet only 4% on ETH reaching a new ATH in 2024, reflecting weak price performance.

Altcoins:

• SoftBank CEO unveiled a $100B US AI investment during a Trump meeting.
• Eliza Labs and Stanford FDCI explored AI agents' impact on digital currencies.
• NYDFS approved a BitLicense for Anchorage Digital's subsidiary.
• Avalanche9000 upgrade went live on the mainnet.
• Lido Finance announced plans to shut down Polygon operations.
• Bybit confirmed its exit from France effective January 8, 2025.
• Binance Web3 wallet Alpha launched, highlighting emerging tokens.
• FTX planned to start customer repayments in early 2025.
• USDT transfer volume on TRON hit a record $587.2B.
• World Liberty Financial and Ethena eyed collaboration, starting with sUSDe.
• Near's Aurora launched the TurboChain AI memecoin.
• US lawmakers canceled the vote to renominate SEC’s Caroline Crenshaw.
• Coinbase ranked among the top five global exchanges, surpassing Nasdaq in revenue.
• Senator Warren demanded transparency on Musk's role in Trump’s transition, which Trump’s team dismissed.
• Bitwise launched Solana staking ETP (BSOL) in Europe.
• Sonic Labs launched the Sonic mainnet.
• Securitize expanded regulated operations to Europe, gaining approval in Spain.
• ASIC sued Binance Australia for investor misclassification.
• Synthetix introduced multi-collateral perps on Base amid a platform revamp.
• Sky announced plans to migrate MKR to SKY in 2025, making MKR legacy.
• Fartcoin reached an all-time high, surpassing a $1B market cap.
• German regulators ordered Worldcoin to delete non-compliant data.
• Curve's Michael Egorov had a liquidated $882K CRV position.
• Hailey Welch denied creating HAWK memecoin and pledged full cooperation.
• Cryptopia users finally received payouts after years following a major hack.
• New prominent listings/delistings:
  • MOCA: Upbit, Bithumb, Binance Futures
  • MOODENG: Bithumb
  • VANA: Binance
  • CAT & PENGU: Binance Airdrop
  • Binance delists: AKRO, BLZ, WRX

SEC Approves First Dual-Asset Crypto ETFs

The SEC has approved the first hybrid Bitcoin-Ethereum exchange-traded funds (ETFs), the Hashdex Nasdaq Crypto Index US ETF and the Franklin Crypto Index ETF, expected to launch in January 2024. These funds will allocate 80% to Bitcoin and 20% to Ethereum based on market capitalizations. Compliance and transparency are prioritized, with real-time updates provided every 15 seconds. The approval reflects a growing confidence in dual-asset frameworks, contrasting with previous single-asset preferences. Notable crypto ETF players include BlackRock, Fidelity, and Grayscale, with mixed market sentiment evident in December, marked by net outflows of approximately $671 million from major crypto funds.

El Salvador Bolsters Bitcoin Holdings Amid IMF Loan Deal

El Salvador purchased 11 Bitcoin for approximately $1 million shortly after finalizing a $1.4 billion loan agreement with the IMF. This acquisition, increasing its total to 5,980.77 BTC valued at around $580 million, signals a shift from its previous buying strategy of one Bitcoin per day. The IMF deal necessitates reducing government involvement in Bitcoin transactions and mandates voluntary private sector acceptance. Despite restrictions, Bitcoin's legal status remains unchanged, and the National Bitcoin Office hinted at accelerating future purchases, reflecting ongoing commitment to Bitcoin while navigating international financial expectations and risk concerns.

Stablecoin Market Sees Ripple and Tether Innovations

The Stablecoin Weekly Market Recap highlights recent developments in cryptocurrency, including the launch of Ripple's RLUSD stablecoin, backed by U.S. dollar deposits and government bonds, aimed at enhancing cross-border payments. Following its approval from the New York Department of Financial Services, RLUSD stabilized around $1 after an initial 20% price fluctuation. Tether invested in StablR to improve stablecoin adoption in Europe, while Ethena introduced USDtb, backed 90% by BlackRock's BUIDL fund, establishing a stable 1:1 peg to the dollar. USDtb aims to support Ethena’s USDe during market volatility, reinforcing its position in the DeFi ecosystem.

Coinbase Faces Criticism Over Wrapped Bitcoin Delisting

Coinbase faced criticism for delisting Wrapped Bitcoin (WBTC), citing risks tied to Justin Sun amid fraud allegations, sparking a lawsuit from BiT Global alleging monopolistic behavior. Critics argue Coinbase aimed to promote its cbBTC over the $13.4 billion-valued WBTC. Meanwhile, on December 19, Donald Trump’s World Liberty Financial swapped $10.4 million cbBTC for WBTC to embrace decentralization and avoid Coinbase control. Trump’s project has made significant investments, including $10 million in ETH, positioning itself as a DeFi leader with governance proposals like integrating Aave v3, reflecting broader ambitions in decentralized finance and crypto liquidity.

Crypto.com Drops SEC Lawsuit After Trump Meeting

Crypto.com withdrew its lawsuit against the U.S. SEC on December 16, shortly after CEO Kris Marszalek's meeting with President-elect Donald Trump at Mar-a-Lago. The legal action, initiated in October, challenged the SEC's jurisdiction over certain digital assets. This sudden pivot suggests Crypto.com's intent to align with the incoming administration, which is perceived as more favorable toward crypto innovation. Key appointments, including Howard Lutnick as Commerce Secretary and Paul Atkins to chair the SEC, indicate a shift towards balanced crypto regulations. Crypto.com aims to collaborate with the Trump administration to establish comprehensive regulations for digital assets.

Aave Considers Exiting Polygon Over Security Risks

The Aave community is at a crossroads as Aave Chan, led by Marc Zeller, proposed withdrawing lending services from Polygon's PoS chain due to security risks associated with Polygon's plan to use over $1 billion in bridge assets for yield generation. Aave manages over $466 million in deposits on Polygon, highlighting its dominance. Zeller's proposal suggests a 0% loan-to-value ratio and raising the reserve factor to 85% to mitigate risk. Polygon criticized Aave’s actions as monopolistic amidst community backlash against the yield proposal, emphasizing governance and user opt-in concerns as central issues in this ongoing DeFi dispute.

Binance Faces Legal Threat Over PNUT Meme Coin

Mark Longo, caretaker of the late Peanut the Squirrel, has sent a cease-and-desist letter to Binance, accusing the exchange of unauthorized use of his intellectual property regarding the PNUT meme coin. He claims Binance infringed on copyrights and trademarks, creating consumer confusion. Longo demands cessation of these activities by December 31, 2024, amid uncertain enforcement actions. Peanut, a viral sensation, was euthanized in November, leading to the rise of meme coins like PNUT, which reached a $1 billion market cap post-listing. Longo also launched his token, JFP, which has since dropped over 95% in value, attracting criticism.

Top Weekly Altcoin Gainers and Losers

Gainers:

Hyperliquid HYPE (+55.34%)

Movement MOVE (+39.64%)

Bitget Token BGB (+33.67%)

Ethena ENA (+15.17%)

Virtuals Protocol VIRTUAL (+11.22%)

Losers:

Pepe PEPE (-30.65%)

dogwifhat WIF (-30.23%)

Gala GALA (-29.98%)

Floki Inu FLOKI (-29.15%)

Celestia TIA (-27.47%)