💸 US spot Bitcoin ETFs reached a record high of US$17 billion net inflows; CBOE confirmed five US spot Ether ETFs will start trading on 23 July

US spot Bitcoin ETFs reached US$17 billion net inflows; CBOE confirmed five US spot Ether ETFs will start trading on 23 Jul; South Korea’s Virtual Asset User Protection Act came into effect on 19 July

Quick Take

• US spot Bitcoin ETFs reached US$17 billion net inflows; CBOE confirmed five US spot Ether ETFs will start trading on 23 Jul; South Korea’s Virtual Asset User Protection Act came into effect on 19 July
• US spot Bitcoin ETFs had a weekly net inflow of $1,198 million last week (past five trading days), compared to a net inflow of $1,048 million the week before. Grayscale Bitcoin Trust ETF’s (GBTC) weekly net outflow settled at $56 million. 
• On the macro side, ECB kept interest rates unchanged, in line with expectations. ECB President Lagarde noted domestic price pressures remain high and wages are still rising at an elevated rate. She did not provide specific guidance on the rate outlook and mentioned ECB’s actions in September are “wide open”. In the US, retail sales were unchanged in June compared to May, better than Reuters’s poll expectations, reflecting resilience in the economy.  The latest CME FedWatch Tool shows a 98% probability of a September rate cut in the US. 
• Notable updates: Polygon will migrate its native token from MATIC to POL on 4 September; the Crypto.com App listed Gravity (G) and Banana Gun (BANANA)
• Notable events in the coming week: Interest rate decision from Canada, US Core Personal Consumption Expenditures (June) and GDP (Q2)

Weekly Market Index

All three indices increased last week. The price and volume indices increased by +11.67% and +13.67% last week, respectively. The volatility index increased more significantly by +74.45%.

Chart of the Week

As of 19 July, US spot Bitcoin ETFs reached a record high of $17 billion in net inflows since launch, according to Farside Investors. Weekly net inflow amounted to $1,198 million last week, the largest weekly record in six weeks. The ETFs accumulated $2.5 billion of net inflows month-to-date in July and are currently on an eleven-day streak of net inflow as of 19 July. This coincided with Bitcoin’s price rebounding from the $57,000 level in the week of 8 July to $67,000 over the past weekend. 

Since the ETFs launched, most of the net inflows were going into BlackRock’s IBIT and Fidelity’s FBTC, which contributed a total of $19.0 billion and $10.0 billion, respectively. This is offset by $18.7 billion in net outflows from Grayscale’s GBTC.

Weekly Performance

BTC and ETH increased by +11.9% and +9.5%, respectively, in the past seven days. The price action for most other selected top market capitalisation tokens was up, with INJ (+32.9%) leading.

Key categories were all up in market capitalisation in the past seven days. The meme category led the rise.

News Highlights

ETFs and Funds

• The Chicago Board Options Exchange (CBOE) confirmed five US spot Ethereum ETF products would commence trading on 23 July, pending “regulatory effectiveness”. The five ETFs include 21Shares Core Ethereum ETF, Fidelity Ethereum Fund, Invesco Galaxy Ethereum ETF, VanEck Ethereum ETF, and Franklin Ethereum ETF. Four other spot ETH ETFs will trade on Nasdaq or NYSE Arca, but there are no official announcements yet from those exchanges. In addition, the US SEC approved 19b-4 filings of two additional spot Ether ETFs, Grayscale Ethereum Mini Trust and ProShares Ethereum ETF, for listing on the NYSE Arca electronic trading platform. ProShares Ethereum ETF will still need to wait for comments on S-1 and is not expected to be listed on 23 July. 
• Grayscale announced plans to spin off a portion of Grayscale Bitcoin Trust (GBTC) into a new ETF. On 31 July, Grayscale will contribute 10% of Bitcoin held by GBTC to its new ETF, Grayscale Bitcoin Mini Trust (BTC). The ETF is set to begin trading on NYSE’s Arca exchange pending final regulatory signoff.  
• Grayscale launched Grayscale Decentralised AI Fund, a new crypto fund that aims to to provide accredited investors with exposure to decentralised AI protocols. The fund has a basket of tokens including Bittensor (TAO), Filecoin (FIL), Livepeer (LPT), Near (NEAR), and Render (RNDR). 
• Crypto fund issuer Valour launched an exchange-traded product (ETP) for Near (NEAR), a first for the token. The ETP will trade on Sweden’s Spotlight Stock Market and is available for both retail and institutional investors. 

Regulations

• South Korea’s new crypto regulations titled the Virtual Asset User Protection Act came into effect on 19 July. They aim to enhance protection for users buying and storing cryptocurrency assets with virtual asset service providers. 
• European Union regulators introduced new guidelines regarding the classification of cryptocurrencies and digital assets under the Markets in Crypto-Assets (MiCA) Regulation. These guidelines, for example, help determine whether a token falls under MiCA. 
• Hong Kong’s Financial Services and Treasury Bureau (FSTB) and the Hong Kong Monetary Authority (HKMA) unveiled plans for a new regulatory framework for stablecoin issuers. The secretary of FSTB mentioned this framework would further strengthen the virtual asset regulatory guidelines in the city. In addition, the HKMA announced the first batch of stablecoin sandbox participants, including Standard Chartered Bank and Hong Kong Telecommunications. 

Others

• Over 36% of Bitcoin owed to Mt. Gox creditors were distributed as of 17 July, according to CryptoQuant. The trustee originally held a total of 141,686 BTC ($9.4 billion). 
• State Street, a US-based asset management and banking company, is considering launching a stablecoin and tokenised deposits to settle transfers on the blockchain, according to Bloomberg. The company is also an investor in Fnality, an interbank distributed ledger technology payment solution.
• IBM and Panasonic are partnering with Constellation Network to support the development of new metagraph technologies based on Hypergraph distributed ledger technology. The launch of this technology would coincide with Constellation’s Global Metagraph Hackathon, taking place from 15 July to 9 September 2024.

Recent Research Reports

• Alpha Navigator: Quest for Alpha [June 2024]: Equities and Fixed Income were up in June, while Cryptocurrencies dropped. Fed remains cautious on rate cuts, while ECB cuts rates for the first time in five years.
• New Developments in GameFi: Play-to-Airdrop and Prediction Markets: Both play-to-airdrop and prediction markets have blurred the boundaries between Web2 and Web3. Our latest report looks into new developments in GameFi by delving deeper into these two trends.
• Research Roundup Newsletter [June 2024]: We present our latest issue of Research Roundup, featuring our deep dives into ETH ETFs, GameFi, and New Layer-2s.

Recent University Articles

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• Shiba Inu: A Beginner’s Guide to the Cryptocurrency’s Ecosystem: Shiba Inu has evolved far beyond the SHIB token and now boasts a metaverse, DeFi capabilities, NFT collections, and a synergised token network.
• What Is MakerDAO (DAI): Learn about MakerDAO, the DAO of DAOs, and its stablecoin, DAI — including how to use, trade, and create it.

Catalyst Calendar

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