Coin360 Weekly Dispatch | Crypto Market Updates & Highlights | July 13 - July 19, 2024

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Crypto Weekly Market Update

Table of Contents

Market Movements and Trends

• Crypto Weekly Recap
• Trump's Survival Spurs Crypto Market Surge
• Ethereum ETF Race Intensifies with Competitive Fees
• Grayscale Launches Decentralized AI Fund for Investors
• Polygon Migrates MATIC to POL, Enhances Network

Security Breaches and Hacks

• WazirX Hack Results in $234.9 Million Loss
• Li.Fi Faces $12 Million Hack Due to Vulnerability
• Rho Markets Exploited for $7.6 Million Due to Oracle Vulnerability

Platform and Protocol Updates

• Tornado Cash Sees $1.8 Billion Deposits Despite Sanctions
• Pixelverse's PIXFI Token Launch Surges 50%
• Worldcoin Faces Manipulation Allegations Amid Token Delay

NFT and Gaming Developments

• Trump Plans Fourth NFT Collection Despite Initial Skepticism
• OpenSea Challenges Blur's Dominance in NFT Market
• Gods Unchained Sees Surge in NFT Sales and Token Activity
• Reddit Ends Animated Collectible Expressions for Polygon NFTs

Crypto Weekly Recap

Bitcoin:

• Weekly change: +16.07%
• BTC rose steadily this week.
• Total cryptocurrency market cap exceeded $2.5 trillion due to broad gains.
• The rally was due to:
  • "Trump Bitcoin Pump": Increased odds of Trump winning the 2024 election.
  • German selling completion: Germany finished a large Bitcoin sell-off.
  • Weakening US dollar: Expectations of interest rate cuts and a growing US deficit.
  • Bitcoin miner capitulation ended: Potential reversal of Bitcoin's price pressure.
  • Technical breakout: Bitcoin surpassed the 200-day EMA and a descending trendline.
• On Monday, reports stated that Bitcoin whales accumulated 71,000 BTC in July, the fastest rate since April 2023.
• Digital asset investments hit a record $17.8 billion YTD, driven by Bitcoin and Ethereum inflows. Bitcoin had its fifth-largest weekly inflow, helping it rise above $60,000.
• Bitcoin ETFs saw $422 million in daily net inflows, led by BlackRock's IBIT ETF.
• On Tuesday, Bitcoin dipped to $62K as Mt. Gox moved $2.8B BTC to internal wallets, then recovered above $65K. Kraken confirmed receiving the funds and planned to redistribute them within 7-14 days.
• Bitcoin and other cryptocurrencies sold off on Wednesday, with Bitcoin dropping below $64K, coinciding with a tech sector equity sell-off, and the WazirX hack on Thursday. Institutions, such as DeFi Technologies, continued to acquire BTC - the firm had doubled its Bitcoin treasury holdings.
• The sell-off was short-term. By Friday, Bitcoin surged at the Wall Street open, reaching over $66.5K during a worldwide computer outage caused by a defective CrowdStrike upgrade. The incident has spurred the crypto community to launch new memecoins related to CrowdStrike and the Microsoft "Blue Screen of Death" error.
• The ECB paused rate changes, prompting speculation that the U.S. Fed may follow suit, with the IMF recommending rate cuts be postponed until late 2024. 
• After Germany's significant Bitcoin sell-off, speculation arose about the UK following suit under new Chancellor Rachael Reeves, who faced pressure to fund economic plans. The UK holds over $4 billion in BTC and could sell assets, potentially causing market volatility. Alternatives included relaxing crypto regulations or holding BTC as a reserve asset.
• A Binance report identified potential catalysts that could drive the market beyond the peak of March, including tapering inflation, potential cuts to interest rates, increased stablecoin supply, and Ethereum ETF approvals.

Ethereum:

• Weekly change: +11.45%
• ETH also saw gains this week.
• Ethereum products had $72 million inflows from institutional investors, showing strong confidence in crypto markets.
• On Monday, ETH surged to nearly $3.5K. Justin Sun, founder of Tron, bought 14,436 ETH worth $45.51 million from Binance, adding to his total of over 377,188 ETH since February.
• The rally continued as the SEC provisionally approved three Ethereum-based ETFs, expected to start trading by July 23.
• The Ethereum ETF race intensified, with eight issuers, including BlackRock, Franklin Templeton, Bitwise, VanEck, 21Shares, Fidelity, Invesco Galaxy, and Grayscale, revealing their management fees.
• With Ethereum ETF anticipation high, ETH broke $3.5K on Wednesday and Friday, its highest since early July.
• Ethereum saw a significant increase in exchange outflows, with around $126 million worth of ETH withdrawn, indicating large-scale accumulation by whales.

Altcoins:

• Scammer returned $9.3M DAI to victim after 10 months of phishing (source).
• Meme Coin MOG hit new all-time high (source).
• Dogwifhat was best coin in H1 2024 with a 1306% price surge (source).
• BlackRock surpassed $10.6T AUM boosted by ETF inflows (source).
• Hong Kong cracked down on seven unlicensed crypto exchanges (source).
• Spain National Fan Token slid after UEFA Euro 2024 win (source).
• South Korea's ruling party proposed to delay crypto taxes by three years (source).
• Celsius agreed to liquidate tokens and rare NFTs in settlement with KeyFi founder (source).
• DePin Helium Mobile released first post-roadmap progress update (source).
• Uniswap Labs launched Uniswap Extension with sidebar, supporting 11 blockchains (source).
• Solana reclaimed $70B market cap and $160 price, Raydium dominated DEX volume and market share grew from 36% to 66% (source).
• Mocaverse revealed Mario Kart-like ‘Cosmic Royale’ after MOCA token drop (source).
• ApeCoin announced ApeChain Testnet launch on July 16, price rose above $0.80 (source).
• Pendle launched new pools on Arbitrum Network (source).
• Tokenized US Treasurys could reach $3B by end of year (source).
• Aethir’s GPU-as-a-service hit $36M revenue with 10% monthly growth (source).
• Degen Chain user lost 90% of funds (source).
• Polyhedra Network launched Staking Program V2 with rewards starting July 18, 2,000,000 ZK prize pool (source).
• OM surged to new all-time high amid MANTRA’s 50 million token giveaway plans (source).
• Zcash community approved decentralized grant allocations with 20% block reward (source).
• 150 countries could now easily buy crypto with Stripe and Coinbase (source).
• Nansen’s new dashboard revealed Aptos’s rise in transactions and developer activity (source).
• Arca tapped Securitize to list tokenized U.S. Treasury fund (source).
• OKX ceased operations in Nigeria (source).
• XBTO established tokenization team to focus on real-world assets (source).
• Gnosis Pay and other crypto projects were impacted in Fractal ID data breach (source).
• State Street looked to create its own stablecoin (source).
• OKX Wallet added support for TON blockchain, marking 100th mainnet integration (source).
• ZetaChain launched Gateway, targeting devs and users (source).
• BtcTurk CEO stepped down from one of Turkey’s biggest crypto exchanges (source).
• Miggles Meme Coin surged to $22M market cap amid Coinbase and Base promotion (source).
• DYM surged after Dymension Name Service debut (source).
• Joe Biden-themed meme coin plummeted as US president got Covid (source).
• Upbit issued first public disclosure under new User Protection Act (source).
• Standard Chartered, Animoca, and others joined HKMA's stablecoin sandbox (source).
• Greek government planned to impose crypto taxes starting 2025 (source).
• OKX selected Malta as MiCA hub for EU compliance (source).
• BlockFi planned to begin repayments to 100,000 creditors this month (source).
• BitGo launched support for Bitcoin L2 Stacks and sBTC (source).
• XRP price dipped as SEC canceled crucial meeting with Ripple (source).
• Judge ordered Robinhood to pay $9M settlement over referral program (source).
• Lumia announced HyperNodes sale to launch L2 liquidity layer (source).
• Chainbase planned to build largest on-chain Web3 data infrastructure, completed $15M Series A (source).
• Kraken Custody expanded to UK and Australia markets (source).
• Chainlink debuted digital assets sandbox to revolutionize capital markets (source).
• Outlier Ventures and Morgan Creek Digital launched Web3 Latam accelerator program (source).
• 21Shares launched Injective ETP with staking on Euronext (source).
• Lens targeted Q4 for mainnet on ZKsync, aiming for AI monetization (source).
• Mantle Network’s MNT token saw surge amid whale buying (source).
• Lido DAO price rally held as staking TVL rose to $34B (source).
• Binance forgave Bloomberg after receiving apology for defamatory coverage (source).
• Cash App shut down in the UK to focus on US market (source).
• Ether.Fi released Season 2 of its ETHFI token airdrop (source).
• Bitrue Ventures launched $40M Web3-focused investment fund (source).
• Hamster Kombat users targeted by phishing attacks and fake airdrops (source).
• Wintermute was in talks for $100M funding round to expand operations (source).
• Galaxy’s staked Ether assets topped $3.3B after CryptoManufaktur acquisition (source).
• Manta Foundation announced strategic investment in dappOS via $50M EcoFund (source).
• Messari co-founder Ryan Selkis stepped down as CEO after aggressive political tweets (source).
• Terraform Labs reopened Shuttle Bridge, destroyed LUNA tokens (source).
• Coinbase planned to list Ancient8 (A8) (source).
• Coinbase planned to launch perpetual futures for Toncoin, Bittensor, and Tellor (source).
• Binance planned to airdrop and list Telegram Trading Bot Token Banana Gun (BANANA) (source).

Trump's Survival Spurs Crypto Market Surge

Following a failed assassination attempt on Donald Trump, Bitcoin and other cryptocurrencies surged on Monday. Bitcoin rose by 4.41% to over $63,000, Ether increased by 4.99% to $3,366, and Solana saw a 5.75% growth to $153.72. Trump’s survival and endorsement of cryptocurrencies, ahead of his planned appearance at the Bitcoin Conference, have significantly impacted market sentiment. 

Trump-related tokens like MAGA Token and FIGHT Token also experienced notable price movements. As Trump's political odds improve post-incident, the crypto community shows readiness to support his campaign, reflecting a dynamic shift in both financial and political landscapes.

Ethereum ETF Race Intensifies with Competitive Fees

The Ethereum ETF race is heating up as 8 issuers reveal competitive fee structures ahead of the July 23 launch. Grayscale leads with a 2.5% fee for its primary ETF but offers fee waivers for its Ethereum Mini Trust up to $2 billion or for the first six months, lowering the fee to 0.15%. BlackRock charges 0.25%, potentially reduced to 0.12% initially, while Franklin Templeton offers the lowest at 0.19%. 

Analysts foresee significant market impact, with predictions of Ethereum surpassing $5,000 and ETF assets reaching $15 billion. Regulatory clarity and market optimism are boosting expectations despite competitive pressures and potential rivals like Solana.

WazirX Hack Results in $234.9 Million Loss

In a significant security breach on July 18, 2024, WazirX, a leading Indian cryptocurrency exchange, lost $234.9 million worth of various cryptocurrencies. Hackers used Tornado Cash to obscure transactions, complicating recovery efforts. Stolen assets include $102 million in Shiba Inu and $52.5 million in Ethereum, impacting market prices. 

WazirX responded by suspending withdrawals and initiating recovery procedures, though some assets were already liquidated. The incident underscores vulnerabilities in crypto security and regulatory challenges in India. Market reactions included a 10% drop in Shiba Inu's price and an 11% decline in Bitcoin's BTC/INR pair, reflecting broader concerns about exchange security.

Li.Fi Faces $12 Million Hack Due to Vulnerability

Li.Fi, a cross-chain DeFi protocol, faced a severe hack resulting in a $12 million loss, affecting 153 wallets. Exploiting a vulnerability in the depositToGasZipERC20() function, hackers withdrew $6 million in Ethereum and stablecoins like USDC, USDT, and DAI. Users were urged to revoke permissions immediately through revoke.cash. 

Following swift responses and security updates by Li.Fi, the exploit is contained, and affected funds secured. This incident underscores ongoing DeFi security challenges, necessitating robust measures and audits. Li.Fi has a history of vulnerabilities, including a 2022 breach. Vigilance and proactive security practices remain crucial in navigating such risks in the crypto ecosystem.

Grayscale Launches Decentralized AI Fund for Investors

Grayscale Investments launched the Grayscale Decentralized AI Fund to expose accredited investors to decentralized AI protocols, including Near (32.99%), Filecoin (30.59%), Render (24.86%), Livepeer (8.64%), and Bittensor (2.92%). 

The fund aims to address AI-related issues, provide decentralized AI services, and support critical AI infrastructure, with quarterly rebalancing. Amid growing interest, AI tokens saw a 24.2% increase, outpacing Bitcoin, Ethereum, and Solana. Nvidia's record share prices and $33 billion AI startup funding boost in early 2024 underscore the sector's momentum.

Polygon Migrates MATIC to POL, Enhances Network

Polygon developers announced the migration of MATIC tokens to POL starting on September 4. This transition aims to enhance Polygon's network, positioning POL as the new native gas and staking asset, replacing MATIC. Users holding MATIC on Polygon's PoS blockchain will automatically receive POL, while those on Ethereum or zkEVM must take additional steps. 

Additionally, Polygon Labs revealed the production readiness of Plonky3, an advanced zero-knowledge (ZK) proving system enhancing Ethereum's scalability. Plonky3, an upgrade from Plonky2, offers modular and flexible options, improving performance by 5-10 times for specific computations.

Rho Markets Exploited for $7.6 Million Due to Oracle Vulnerability

Rho Markets, a DeFi lending protocol on Ethereum Layer 2 Scroll, was exploited for $7.6 million due to an oracle vulnerability. The attacker used a MEV bot, claiming it was a misconfiguration, not a hack, and is willing to return the funds if Rho Markets admits the error and outlines prevention measures. 

Following the exploit, Scroll delayed chain finalization. The attacker sent the funds to a multi-sig wallet, hinting at a possible white hat operation. This exploit adds to a series of significant crypto hacks, making this week the second most lucrative for crypto thieves in 2024.

Tornado Cash Sees $1.8 Billion Deposits Despite Sanctions

Tornado Cash, a crypto mixing protocol, saw a significant recovery with over $1.8 billion in deposits in the first half of the year, a 45% increase from the previous year, despite US sanctions. This resurgence is attributed to its use in laundering funds from major hacks like the $76 million Poloniex theft and $166 million HECO Bridge exploit. Regulatory efforts have had limited impact due to the decentralized nature of Tornado Cash. Meanwhile, co-founder Alexey Pertsev remains imprisoned, with bail denied by a Dutch court.

Pixelverse's PIXFI Token Launch Surges 50%

Pixelverse launched its PIXFI token, which surged 50% in initial trading, achieving a $200 million market cap. The airdrop distributed 10% of PIXFI's supply to NFT holders and plans another 20% for users. PixelTap, Pixelverse's Telegram game, gained 50 million users in June. On July 16, Pixelverse announced the integration of Pudgy Penguins' character "Pudgy" into PixelTap. 

The NFT market saw a 45% drop in Q2 2024 sales. Notcoin, a Telegram game, offers exclusive perks to high-level players in collaboration with Pixelverse and Musk Empire, promoting further integrations in social gaming.

Worldcoin Faces Manipulation Allegations Amid Token Delay

Worldcoin is under scrutiny for allegedly manipulating prices after delaying the release of 80% of its tokens. Originally planned over three years, the new schedule extends to five years, starting July 24, 2024, to slow down token supply. Following the announcement, Worldcoin's token price surged 68% in two days, reaching $3.20 before a slight correction. 

Crypto investigator ZachXBT labeled Worldcoin as "the biggest scam token of the bull run," accusing insiders of exploiting advance knowledge. The project faces criticism for potential insider trading and market manipulation, although Worldcoin has yet to respond to these allegations.