Coin360 Weekly Dispatch | Crypto Market Updates & Highlights | December 7 - December 13, 2024

Crypto Weekly Market Update

Table of Contents

Market Movements and Trends

• Crypto Weekly Recap

Banking and Corporate Decisions

• Microsoft Shareholders Reject Bitcoin Allocation Proposal
• Trump Revives Federal Bitcoin Reserve Plan

Crypto Exchanges and Platforms

• Binance and Circle Boost USDC Adoption
• Ripple Launching RLUSD Stablecoin by Year-End

Regulatory and Country-Specific Developments

• Regulatory Moves Spark Global Crypto Developments

Blockchain Upgrades and Innovations

• Avalanche Secures $250M for Upgrade Launch

Security Incidents

• Dogecoin Exploit Crashes Majority of Nodes

NFT Market Updates

• Pudgy Penguins Overtake BAYC in NFT Market
• NFT Market Sees $187M Weekly Sales Surge

Platform and Token Launch Issues

• Magic Eden Airdrop Sparks Chaos

Crypto Weekly Recap

Bitcoin:

• Weekly performance: +4.15%
• US Spot BTC ETFs: +$1.74B, 11 consecutive days with positive netflow
• BTC closed last week above $100K but dropped to $95.6K and $94.7K on Monday and Tuesday.
• The dips were driven by an overheated market, Coinbase traders’ selloff, and Google quantum computing chip FUD.
• On Wednesday, November CPI rose 2.7% year-over-year, matching forecasts, while Core CPI hit 3.3%. Stable inflation eased fears of aggressive monetary policy and supported risk-on assets like Bitcoin.
• On Thursday, the US Producer Price Index (PPI) increased to 3% in November from 2.4% in October, the largest rise since February 2023, exceeding the 2.6% forecast. Core PPI rose to 3.4%, above the previous month’s 3.1% and the 3.2% estimate. Monthly inflation climbed to 0.4% from 0.2%, impacting market sentiment and raising fears of Fed hawkishness.
• Sentiment shifted as the ECB cut its deposit rate by 25 basis points to 3% to counter slowing inflation and growth. Analysts noted that this, along with potential rate cuts by China’s central bank, boosted risk-on sentiment. Markets speculated on a 96% likelihood of a 25-basis point Fed rate cut at the December FOMC meeting.
• BTC rebounded above $100K, trading near $100.3K at the time of writing.
• Long-term Bitcoin holders sold 828,000 BTC worth $82.59 billion in the last 30 days, while institutional buying surged:
  • Crypto ETPs saw $3.85 billion in inflows last week, with BTC products leading at $2.5 billion.
  • At the time of writing, Bitcoin ETFs reached 524.8K BTCs in cumulative net inflows in their first year, with BlackRock's spot ETF surpassing its gold ETF in size.
  • MicroStrategy purchased 21.5K BTC for $2.1 billion.
  • Riot Platforms acquired 5,113 BTC for $510 million.
  • Australia’s AMP pension fund invested $27 million in Bitcoin.
• Critics opposed BTC as a national reserve, calling it “a tech stock, not a stable asset,” per Jesse Colombo. Microsoft shareholders rejected Bitcoin over volatility, but Trump and supporters remained optimistic:
  • Trump hinted at “something great with crypto.”
  • Pro-crypto members like French Hill joined the new administration.
  • Eric Trump predicted BTC would hit $1M, driving a global financial revolution.
  • BlackRock recommended a 2% allocation to Bitcoin in portfolios.
  • Amazon shareholders urged a 5% allocation of company assets to Bitcoin.
• As per Glassnode, Bitcoin’s ROI was 26.94% below the average of the last two market cycles (2015–2018 and 2018–2022), which delivered up to 8.18x returns. The current cycle, starting in late 2022, showed reduced volatility, with an average correction of 16.24% and a maximum drawdown of 26%. Analysts forecast the rally to continue into 2025.

Ethereum:

• Weekly performance: -0.5%
• US Spot ETH ETFs: +$831.24M, 14 consecutive days with positive netflow
• ETH finally saw steady ETF inflows, improving sentiment and briefly surging pass $4,000 before rejection.
• Its dips aligned with BTC's but were less severe, reaching $3,536 weekly low before rebounding near $3,900.
• Smart money purchases:
  • BlackRock and Fidelity ETFs bought $500 million worth of ETH in two days.
  • Trump-backed WLFI purchased $12M in ETH, LINK, and AAVE, raising its ETH holdings to $56M.
• Ethereum’s daily transactions increased to 6.5–7.5M, up from an average of 5M in 2023.
• Ethereum’s realized price hit $5,200, reflecting 2021’s peak and suggesting further upside potential.
• Higher on-chain activity raised fees, burning more ETH, slowing supply growth, and adding deflationary pressure.
• U.S.-listed spot Ethereum ETFs saw $1.95B inflows in 13 days, bringing total net assets to $13.18B.
• CryptoQuant predicted Ethereum could exceed $5,000 if current trends and demand persist.
• Ethereum’s momentum lagged behind L1 coins like SUI, which rebounded to new ATHs, and SOL: recent report suggested that Solana outpaced Ethereum with 206 AI tokens, $5B market cap, and 7,625 new developers in 2024.
• Trump suggested the focus on AI during talks with Jim Cramer. Ethereum should catch up in this sector.

Altcoins:

• OKX Ventures invested $5M to expand the TON ecosystem.
• DWF Labs launched a $20M fund for autonomous AI agents.
• Beam Ventures committed $150M to blockchain, gaming, and AI projects.
• Morpheus offered $20M in rewards to AI compute providers.
• Coinbase addressed account restriction claims, stating, "We didn’t ignore you."
• Amazon shareholders requested allocating 5% of assets to Bitcoin.
• El Salvador reduced Bitcoin use to secure a $1.3B IMF loan.
• PEPE overtook LTC, surpassing a $10B market cap.
• Farcaster launched Snapchain for faster social networking.
• Movement Network rolled out its mainnet beta and native token.
• Milady NFT creators debuted Meme Coin Cult.
• Radiant Capital revealed a $50M hack by a DPRK-linked actor posing as a contractor.
• Ethena’s USDe surpassed DAI as the third-largest stablecoin.
• Ethereum rollup Fuel introduced a token to decentralize its chain.
• Solana DEX Raydium outpaced Uniswap, capturing 65% of Solana’s monthly trading volume.
• MicroStrategy moved closer to Nasdaq 100 inclusion, with S&P 500 eligibility by 2025.
• Japanese exchange Coincheck prepared for Nasdaq trading.
• Travala’s AVA token soared 300% after Binance investment, crossing $100M in revenue.
• Notcoin Studio unveiled Telegram-based Launchpool Rewards Platform.
• Binance dominated 2024 with $21.6B deposits and 250M users.
• Nvidia faced a lawsuit over crypto revenue claims.
• LINE NEXT and Kaia Foundation planned Web3 mini-dapps for LINE Messenger in 2025.
• Elon Musk’s net worth surpassed Tether, Solana, and XRP market caps combined.
• Frax Finance worked on an AI tech stack for Fraxtal Layer 2.
• Grayscale introduced Optimism and Lido DAO trusts.
• Australia’s ASIC fined Kraken’s operator Bit Trade $5M for violations.
• A hardware wallet user lost 10 BTC; Ledger attributed it to phishing.
• Coinbase restricted European trading of USDT, GUSD, and others to meet MiCA regulations.
• LayerZero opened voting on protocol fee activation.
• Gate.io denied hacking rumors amid GT hitting a new ATH.
• Polygon community discussed a $1.3B stablecoin reserve proposal.
• EigenLayer proposed ELIP-002 to improve restaking and pledged $8M for Ethereum development.
• Sui expanded its ecosystem with ESG-backed RWA tokenization.
• Byte Federal reported a data breach impacting 58K customers.
• A U.S. Bitcoin investor was sentenced for $4M tax evasion.
• New prominent listings:
  • Binance: VELO
  • Coinbase: ME, GIGA, TURBO, PNUT
  • OKX: GOAT
  • Bithumb: SCR, RON
  • Binance Futures: RAY, KOMA, VIRTUAL, SPX

Microsoft Shareholders Reject Bitcoin Allocation Proposal

Microsoft shareholders overwhelmingly rejected a proposal to allocate 1-5% of the company’s $3.9 billion assets to Bitcoin, with only 0.55% of votes supporting it, citing Bitcoin’s volatility and unsuitability for corporate treasuries. Proposed by the National Center for Public Policy Research and endorsed by Michael Saylor, the plan aimed to hedge inflation and boost market value. Microsoft’s board emphasized low-risk investments like treasury bonds, aligning with institutional shareholder views, including BlackRock. Meanwhile, firms like MicroStrategy embraced Bitcoin, amassing 423,650 BTC, outperforming Microsoft stock by 313% in 2024, though Microsoft continues monitoring crypto trends cautiously.

Trump Revives Federal Bitcoin Reserve Plan

President-elect Donald Trump said: “We’re doing something great with crypto,” re-proposes establishing a federal Bitcoin reserve to secure the U.S.'s leadership in the cryptocurrency industry, similar to the strategic petroleum reserve, to counter rival nations like China. His transition team is reportedly exploring deregulation options for banking regulators. Additionally, Congressman French Hill has become chair of the House Financial Services Committee, promoting pro-crypto policies amidst concerns over regulatory overreach. In Texas, a bill proposes creating a state Bitcoin reserve, funded by citizens, to address inflation and enhance financial security, with a commitment to hold the cryptocurrency for at least five years without transactions outside the state.

Binance and Circle Boost USDC Adoption

Binance and Circle have formed a strategic partnership to enhance the global adoption of USDC, the second-largest stablecoin. This collaboration integrates USDC across Binance's trading, savings, and payment platforms, including its corporate treasury. Notable features include new trading pairs and promotional campaigns to encourage usage. USDC recently became the first stablecoin to meet Canada’s regulations, boasting a market cap of $40.86 billion, yet still trailing Tether's $138.62 billion. Stablecoins account for over 80% of crypto trading volumes, with transaction volumes reaching $5.5 trillion in Q1 2024, underscoring their growing importance in the financial ecosystem.

Ripple Launching RLUSD Stablecoin by Year-End

Ripple’s RLUSD stablecoin, approved by the NYDFS, is set to launch by the year-end, debuting on the Ledger and Ethereum blockchains with potential expansion to Tron. The stablecoin, pegged to the US dollar and backed by USD reserves and short-term U.S. Treasuries, aims to facilitate cross-border payments and boost liquidity. Testing began in August, and Ripple has secured partnerships with key exchanges like Uphold and Bitstamp, alongside market makers B2C2 and Keyrock. Recently, 13 million RLUSD were minted, signaling readiness for market entry. The stablecoin market, valued at $196 billion, is forecasted to grow to $2.8 trillion by 2028.

Regulatory Moves Spark Global Crypto Developments

The FDIC allegedly pressured banks to halt crypto services through "pause letters," spurring fears of regulatory overreach. El Salvador plans to revise its Bitcoin Law for a $1.3 billion IMF loan, making Bitcoin acceptance voluntary amid financial scrutiny. A draft bill in Ukraine aims to legalize cryptocurrencies by early 2025, regulating transactions and implementing a taxation system similar to that of securities. South Korea delayed a 20% crypto tax until 2027, aiming to boost market activity. Vancouver will study accepting Bitcoin for municipal use, facing provincial barriers. Argentina approved Bitcoin and Ethereum ETFs to modernize its financial sector. Brazil may reverse a proposed stablecoin self-custody ban, emphasizing market flexibility. Tether’s USDT was accepted as a virtual asset in Abu Dhabi, bolstering its regulatory position. Kenya's Fire Brigades Association adopted Bitcoin to expand its operations. Lastly, Italy shelved a proposed crypto tax hike from 26% to 42% after backlash, citing risks to innovation and investor migration.

Avalanche Secures $250M for Upgrade Launch

Avalanche has secured a $250 million locked token sale to support its upcoming Avalanche9000 upgrade, with key investors including Galaxy Digital, Dragonfly, and ParaFi Capital, alongside over 40 others. Scheduled for a December 16 launch, Avalanche9000 promises a 99.9% reduction in deployment costs and a 25-fold decrease in transaction fees. This upgrade aims to enhance decentralized finance (DeFi) and blockchain scalability, with significant institutional participation already noted. Following the announcement, AVAX prices surged 14.63% in 24 hours, and total value locked on the platform increased by 66%, reaching $2.18 billion, signaling strong market confidence and recovery prospects.

Dogecoin Exploit Crashes Majority of Nodes

On December 12, 2024, the Dogecoin network suffered a significant exploit, crashing 69% of its active nodes due to a vulnerability called "DogeReaper." Orchestrated by Andreas Kohl using an old laptop, the attack reduced active nodes from 647 to just 205, with a slight recovery to 315. This vulnerability allows remote node crashes through segmentation faults via publicly accessible addresses. Alarmingly, 87% of nodes had not updated to the patched version, raising security concerns. The incident highlights urgent needs for improved security practices and timely software updates within cryptocurrency ecosystems to prevent similar attacks in the future.