In an unprecedented surge, crypto funds around the globe registered record inflows totaling .45 billion last week, marking a significant uptick in investor interest. This influx has propelled the total assets under management (AUM) back to levels not seen since December 2021, signaling a strong resurgence in the crypto investment space. Record .45 Billion Inflows […]
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Grayscale’s GBTC Offloads $527M in Bitcoin as Spot ETFs Record Lower Trading Volumes; Other Funds Continue BTC Accumulation
Based on the latest data, the recently introduced spot bitcoin exchange-traded funds (ETFs) experienced their lowest trading volume day since Jan. 11, 2024, recording roughly .28 billion in volume on Wednesday. Additionally, figures indicate that Grayscale’s Bitcoin Trust GBTC has offloaded another tranche of bitcoins, totaling 13,178.50 bitcoin valued at 7 million, in the last 24 hours.
Spot Bitcoin ETFs Hit Lowest Volume Since Jan. 11; Grayscale Unloads Over 13,000 Bitcoin, 9 New ETFs Hold .91B in Assets
As of Thursday, Jan. 25, Grayscale’s GBTC possesses 523,516.43 BTC, valued approximately at .71 billion based on the current BTC exchange rates. This figure is 13,178.50 BTC less than the previous day when the holding was 536,694.93 BTC. Consequently, since Jan. 12, 2024, GBTC’s bitcoin holdings have diminished by 93,563.56 bitcoin, equivalent to a value of .74 billion.
Despite Wednesday’s trading sessions being less vigorous than earlier days, GBTC remained a major player, commanding 0 million of the day’s total .28 billion in trading volume. In contrast, other spot bitcoin ETFs are steadily accumulating bitcoins. Blackrock’s IBIT currently possesses 45,668.08 BTC, valued at approximately .83 billion.
Fidelity’s FBTC has yet to update its daily figures, with the last recorded amount on Jan. 24 being 38,149.16 BTC. However, onchain metrics as of 8:00 a.m. Eastern Time on Thursday suggest FBTC now contains 39,319 BTC. On Wednesday, Ark Invest’s ETF had a holding of 12,880 BTC, which increased to 12,880 BTC by Thursday. Bitwise’s holdings remain static, with its address “1CKVs” continuing to secure 11,858.64 BTC.
Vaneck’s HODL ETF has experienced a modest rise, moving from 2,715.77 BTC to 2,772.33 BTC within a day. Similarly, Franklin Templeton’s EZBC has escalated from 1,305 BTC to 1,344 BTC. The Invesco Galaxy ETF, known as BTCO, maintains an estimated 6,339 BTC based on its assets under management (AUM). Valkyrie’s BRRR ETF has ascended from 2,201.50 BTC to a present total of 2,429.72 BTC, while Wisdomtree’s BTCW ETF has increased from 191 BTC to 201 BTC. Collectively, these newly launched spot bitcoin ETFs now hold a cumulative total of 122,831.77 BTC, worth an estimated .91 billion.
What do you think about the latest GBTC outflow and the accumulation from other ETFs? Share your thoughts and opinions about this subject in the comments section below.
Celsius Seeks Repayment: Creditors Urged To Return 27.5% Of Funds
Surprisingly, bankrupt crypto lender Celsius Network customers are now facing legal action from bankruptcy managers after making substantial withdrawals within 90 days before the company’s bankruptcy declaration.
The bankruptcy managers have demanded that affected customers return some of their funds or potentially face further legal consequences.
Customers Face Celsius Network’s Settlement Demands
The filing, published on Tuesday, revealed that customers who withdrew over 0,000 within the specified 90-day period before July 12, 2022, find themselves at the center of the legal dispute.
These customers have been notified through an official filing outlining the procedures for settling their withdrawal preference exposure.
Withdrawal preference exposure noted in the notice refers to the aggregate value of assets withdrawn by customers from the Celsius Network platform during the specified period, minus any subsequent deposits made after the first withdrawal.
The bankruptcy managers have determined that customers with withdrawal preference exposure greater than 0,000 must settle their claims or obtain a court order ruling to avoid potential liability.
The bankruptcy plan, known as the Modified Joint Chapter 11 Plan of Reorganization of Celsius Network LLC and Its Debtor Affiliates, offers an Account Holder Avoidance Action Settlement.
Under this settlement, the Debtors will release avoidance actions against account holders meeting certain criteria, including accepting the plan on all claims and providing a payment equal to 27.5% of their withdrawal preference exposure.
The distribution agent is not obligated to make distributions to account holders with unresolved withdrawal preference exposure until their claims are settled, a court rules in their favor, or the withdrawal preference exposure is resolved with the litigation administrator after the plan’s effective date.
Settle Now Or Face Consequences
Celsius Network, in collaboration with the committee, has extended the payment deadline to allow affected customers to settle their withdrawal preference exposure and receive a release of all avoidance actions. The plan’s effective date is anticipated to occur around January 31, 2024.
Customers wishing to make the settlement payment must also submit the election form by January 25, 2024. The Debtors will start accepting completed election forms on January 17, 2024. Failure to submit the form may result in the rejection of the settlement payment.
It is important to note that failure to settle withdrawal preference exposure by January 31, 2024, may lead to further correspondence or actions by the litigation administrator after the plan’s effective date.
As customers grapple with the unexpected legal action, the crypto community awaits further developments in this ongoing bankruptcy case.
The Account Holder Avoidance Action Settlement outcome will shed light on resolving withdrawal preference exposure claims and the subsequent distribution of funds.
Featured image from Shutterstock, chart from TradingView.com
A Bullish Beginning? $151 Million Poured Into Crypto Funds In 2024’s First Week
The first week of 2024 marked a notable milestone in crypto asset investments. Investment products in this particular sector witnessed inflows amounting to 1 million, according to a recent report from CoinShares.
Crypto Asset Funds Sees Surge In Inflows
This 1 million surge in inflow, as highlighted by James Butterfill, Head of Research at CoinShares, is particularly noteworthy in light of the Grayscale vs. US Securities and Exchange Commission (SEC) lawsuit, with these inflows contributing to a total of .3 billion since the case began in October 2022.
This amount accounts for 4.4% of the firm’s total managed assets. Even without a spot exchange-traded fund (ETF) launch in the US, Butterfill revealed that American exchanges contributed to over half of these inflows, at 55%. German and Swiss exchanges followed, contributing 21% and 17% of the inflows, respectively.
Bitcoin emerged as the leader in investment inflows, amassing 3 million. This substantial sum equates to 3.2% of the total assets under management (AuM) in the last nine weeks.
James Butterfill pointed out an interesting trend that challenges the anticipation of the US SEC approval of a spot Bitcoin ETF being a “buy the rumor, sell the news” event. Butterfill noted in the report:
If many truly believed that launch of the [spot] ETF in the US would a “buy the rumour, sell the news” event, we surely would expect to see inflows into short-bitcoin ETPs, instead, outflows over the last 9 weeks have amounted to USm.
Notably, this is because “buy the rumor, sell the news” implies that investors buy assets ahead of an anticipated event (like the spot ETF launch) and sell them when the actual event occurs, often leading to a price decline.
However, the observation here by Butterfill is quite the opposite. Instead of seeing inflows (more investment) into short-Bitcoin exchange-traded products (ETPs) (which benefit from a decline in Bitcoin’s price), there have been outflows amounting to million over the last nine weeks.
This indicates that investors might not expect a significant price drop following the spot Bitcoin ETF launch in the US, contradicting the “buy the rumor, sell the news” expectation.
Ethereum And Altcoins: A Mixed Bag Of Sentiments
Ethereum’s performance in the crypto asset investment space has also been noteworthy. The second-largest crypto by market cap saw inflows of million, with the last nine weeks bringing in 5 million. This influx indicates a significant shift in investor sentiment towards Ethereum.
While Solana, on the other hand, faced outflows amounting to .3 million, Cardano, Avalanche, and Litecoin witnessed inflows. Cardano saw .7 million, Avalanche million, and Litecoin .4 million in inflows. The blockchain equity sector also started the year on a strong note, recording inflows of million in the past week.
Despite Bitcoin’s dominance in inflows, the flagship crypto has recently experienced a net outflow of .8 million, with short Bitcoin investment products also seeing a minor outflow last month.
However, Bitcoin’s recent 3 million inflow has shown the asset’s move to rebound. Even in price performance, Bitcoin has increased by 5.2% over the past week and appears to be continuing its upward trajectory by 1.1% in the first 24 hours, with its trading price nearing the ,000 mark.
Contrastingly, Ethereum, after a 2% decline over the past week, is showing signs of recovery, increasing by nearly 1% in the past day. Other altcoins such as Solana, Cardano, Avalanche, and Litecoin have been less fortunate, experiencing significant losses, with Avalanche and Cardano being the top losers, down by 27.3% and 17% in the past week.
Litecoin and Solana, though also in the red, have seen slightly lesser declines. Solana is down by 10% over the past week and 1.6% in the past 24 hours, while Litecoin mirrors this trend, down by 10.8% over the week and 0.4% in the last day.
Featured image from iStock, Chart from TradingView
Crypto Funds Flourish In 2023: CoinShares Reports $2.2 Billion Inflow
CoinShares, a leading crypto asset investment firm, reported a substantial .2 billion inflows into digital asset investment products in 2023. This figure represents a notable 2.7-fold increase from the inflows seen in 2022, marking it as the third-largest year for such investments since 2017.
According to James Butterfill, Head of Research at CoinShares, this increase signals a significant shift in investor sentiment and market dynamics compared to the previous year.
Despite this uptick, the inflows remained under the record highs of .7 billion in 2021 and .6 billion in 2020. Butterfill attributes much of the recovery to the final quarter of the year, noting:
[This was] where it became increasingly clear that the SEC was warming up to the launch of bitcoin spot-based ETFs in the United States.
Diverse Investment Trends Across Crypto Funds
Bitcoin investment products were the primary beneficiaries, accounting for .9 billion or 87% of yearly inflows. This dominance of Bitcoin-related inflows marks the largest percentage allocation to date, surpassing the previous peak of 80% in 2020 and significantly higher than the 42% seen 5 years ago in 2017.
Butterfill noted no clear trend in this allocation, suggesting that the hype surrounding US SEC-approved spot ETF might be a contributing factor.
In contrast, Ethereum investment products saw a modest recovery in inflows towards the year’s end, totaling million. However, this represented only 0.7% of Coinshares’ total Assets Under Management (AUM). On the other hand, Solana investment products recorded inflows of 7 million or 20% of the firm’s total AUM in 2023.
The US led the pack in terms of inflows in dollar terms, with 2 million, followed by Germany with 3 million and Canada with 3 million. However, when analyzing inflows as a percentage of AUM, the US saw a modest 2% increase, while Germany and Canada witnessed a more significant growth of 22% and 15% of AUM, respectively.
This disparity suggests a regional variation in investor preferences and strategies, particularly in the US, where the anticipation of a spot-based ETF may have influenced investment choices, according to Butterfill.
In total, assets under management at these funds surged by 129% over the year, hitting a high of billion, a value not seen since March 2022. Blockchain equities also saw a rise, with inflows increasing 3.6 times to 8 million in 2023, resulting in a 109% rise in AUM.
Recent Market Recovery Post-Matrixport’s Report
The crypto market, however, is not without its recent turmoil. The market faced a setback following a bearish report by Matrixport, which speculated on the rejection of spot Bitcoin ETFs by the US SEC.
This report triggered a brief market downturn, with Bitcoin and Ethereum experiencing significant drops. Nonetheless, both cryptocurrencies show signs of recovery, with Bitcoin regaining its ,000 mark and Ethereum climbing above ,200.
Featured image from Unsplash, Chart from Tradingview
Bitcoin Breaks Through Securities Barrier: Registered Funds Want Exposure To BTC
An interesting trend looks to be developing among institutional players as their interest in the flagship cryptocurrency, Bitcoin, continues to rise. This interest has in no small way been thanks to the frenzy around the Spot Bitcoin ETFs, which could be approved sooner than later.
Other ETFs Considering Bitcoin As An Investment Option
Crypto commentator and music producer Marty Party recently drew the crypto community’s attention to an emerging trend among fund managers and their ETFs. He noted how these asset managers are amending the prospectus of funds they manage so they can gain exposure to Bitcoin.
These institutions are said to be looking to use 15% to 50% of assets under their management to gain exposure to BTC. One way they will be looking to achieve this is through the Spot Bitcoin ETFs that could potentially launch anytime soon.
Marty Party specifically highlighted the case of Advisors Preferred Trust, which is already looking to gain the SEC’s permission to invest up to 15% of its AuM in Bitcoin-related ETFs like Grayscale’s Bitcoin Trust (GBTC) and ProShares Bitcoin Strategy ETF.
MicroStrategy’s Executive Chairman and Co-founder, Michael Saylor, had previously hinted that something like this was going to happen soon enough. Then, he suggested that more institutional players were going to direct more of their capital to Bitcoin.
A rule that was implemented by the Financial Accounting Standards Board (FASB) has also paved the way for more companies like MicroStrategy to include BTC on their balance sheet.
The launch of Spot Bitcoin ETFs will also make it easier for these institutional investors to gain direct exposure to the flagship cryptocurrency.
For a long time now, those who had a prior interest in the crypto token have had to either invest in Bitcoin futures ETFs or other Bitcoin derivatives on exchanges like the Chicago Mercantile Exchange (CME). But this is changing with the potential approval of a Spot Bitcoin ETF.
Grayscale Leading In The “Cointucky Derby”
As highlighted recently by Bloomberg Analyst James Seyffart, Grayscale looks to set the lead the way, assuming all pending Spot Bitcoin ETFs were approved simultaneously. This is because the asset manager has already established itself with GBTC and would likely have more capital than other issuers upon launch.
Bloomberg Analyst Eric Balchunas highlighted this fact and hinted that the Securities and Exchange Commission (SEC) could decide not to let Grayscale launch on day one because of this. If that doesn’t happen and all funds launch simultaneously, then Grayscale is likely to have a sort of ‘first mover advantage.’
However, other asset managers will be looking to assert their dominance by adopting different strategies. One such strategy will be these issuers undercutting themselves in terms of the fees they will charge to manage their respective funds. Invesco already made it known that they will be waiving fees for the first six months and the first billion in assets.
ETHW Core Team Dissolved Just Weeks After Pleading for Funds to Maintain Servers
The Ethereum Proof of Work (ETHW) core development organization has been dissolved to help the protocol achieve full autonomy. In late November, the ETHW team pleaded for 0,000 in funding to maintain servers and recruit part-time engineers. ETHW Core team’s development approach has been criticized.
Upholding PoW as the Chain’s Consensus
On Dec. 18, the Ethereum Proof of Work (ETHW) core development organization was dissolved to help the protocol achieve full autonomy. A statement released by an ETHW core team member said the decision, which allows ETHW to operate independently without the Core’s support, followed “in-depth discussions and [was] based on a majority consensus.”
Explaining the rationale behind the decision, the ETHW core team claimed that this has been its commitment since forking from the Ethereum blockchain in September 2022. Besides the dissolution, the core team also resolved to uphold proof of work “as the underlying consensus for the chain” as well as maintaining it over the long term.
“The existing servers will be temporarily transferred to Onedao for transitional maintenance until long-term ecological partners are identified,” the core team added.
After emerging from The Merge, the team behind ETHW endorsed turning the protocol into “an all-in-one ecosystem decentralized autonomous organization (DAO)” among other changes. Despite this and subsequent attempts to improve it, the protocol nonetheless began having trouble raising funds to keep the servers running.
Seeking 0k for EthereumPoW (2024) operational funds. Maintaining ETHW Core servers and recruiting 1.5 part-time engineers. Your support ensures stability!
#ETHW #CryptoCommunity #ethereumPoW @awsbclub_cn
— EthereumPoW (ETHW) Official (@EthereumPoW) December 1, 2023
On Nov. 30, the ETHW team pleaded 0,000 in funding to maintain servers and recruit part-time engineers. The core’s multi-sig balance had dwindled to 10.75 ETHW or .58 at that time. However, Chad Edwards, formerly of Twitter, immediately questioned the plea.
“I strongly disagree with your approach to development. We, NFT Beatles enthusiasts, have made efforts to bring Beatles and the ETHW system to everyone. What are you doing in the ETHW 15$ to 1$ phase? And now, you only tweeted twice in the past six months, once in June and once in July. And suddenly, you demand 200,000$,” Edwards asked.
The X user however said at the time that if the ETHW core team came up with a specific development plan, this is likely to get support.
What are your thoughts on this story? Let us know what you think in the comments section below.
Crypto Funds’ 11-Week Inflow Streak Snapped: Bitcoin Faces $33M Exodus As Altcoins Shine
The crypto investment landscape has experienced a notable shift recently, as digital asset investment products saw their first net outflows in 11 weeks. This development was predominantly led by Bitcoin, which had previously enjoyed a consistent inflow into various crypto funds.
In a recent report by CoinShares, a leading digital asset management firm, last week marked a break in an 11-week streak of inflows, with a net outflow of million. This change signals a potential reevaluation among investors regarding their positions in digital assets.
Bitcoin Funds Encounter Turbulence
Bitcoin-based funds were at the forefront of this movement, experiencing significant outflows. Last week, these funds experienced a net outflow of .8 million, while short Bitcoin investment products also saw a minor outflow of 0,000.
Despite this, trading activity for Bitcoin remained robust, grossing .6 billion last week, substantially higher than the .6 billion yearly average.
James Butterfill, Head of Research at CoinShares, analyzed the outflows and suggested that the net flows were primarily driven by the US and German markets, which saw outflows of .3 million and .7 million, respectively.
In contrast, markets such as Switzerland and Canada saw inflows, indicating a mixed regional response that leans more towards profit-taking rather than a wholesale sentiment shift in the asset class, according to Butterfill.
Altcoins Gain Traction As Blockchain Equities Surge
Interestingly, while Bitcoin and other major assets like Ethereum and Avalanche experienced outflows, altcoins such as Solana, Cardano, and XRP bucked the trend. They mainly registered inflows of .6 million, million, and .7 million, respectively.
These movements underscore the diversification within the crypto asset class and highlight investor interest in a broader range of digital currencies beyond the dominant Bitcoin and Ethereum.
Blockchain equities also reflected a favourable sentiment, with inflows amounting to 2 million last week. This marks the continuation of a nine-week streak, accumulating 4 million in total — the largest streak to date.
This uptick in blockchain equities underscores the growing investor confidence in the technological infrastructure underpinning cryptocurrencies.
Regarding price performance, the past week saw mixed results among top crypto assets. While Bitcoin recorded a relatively modest decline of 1.8%, XRP and Ethereum saw more significant drops of 4.4% and 3.7%, respectively.
Conversely, altcoins such as Solana, Cardano, and Avalanche showcased appreciable gains. Avalanche led the pack with an increase of over 10% in the past week, followed by Solana and Cardano with gains of 3.1% and 3.6%, respectively.
Featured image from iStock, Chart from TradingView
OKX DEX Loses Over $400,000 To Hackers – What Happens To Customer Funds?
According to blockchain security company SlowMist, OKX DEX, a decentralized exchange aggregator platform, lost cryptocurrency valued at over 0,000.
An attacker was able to transfer tokens that users had not allowed by compromising the management privileges of a market maker contract, according to the explanation for the vulnerability.
On the OKX DEX aggregator platform, a deprecated proxy contract was the subject of a recent vulnerability that allowed a hacker to obtain administration access to the contract without authorization.
OKX DEX: Deprecated Contract Raises Concerns
When a protocol stops actively using a contract to carry out user transactions, it is considered deprecated. It appears that OKX has updated the contract but hasn’t entirely stopped using it.
SlowMist Security Alert: OKX DEX Proxy Admin Owner’s Private Key Suspected to be Leaked
According to information from SlowMist Zone, the OKX DEX contract appears to have encountered an issue. After SlowMist’s analysis, it was found that when users exchange, they authorize…
— SlowMist (@SlowMist_Team) December 13, 2023
The claimTokens function of the OKX DEX smart contract experienced a problem, according to blockchain security firm SlowMist. The TokenApprove contract, which required user authorization, invokes the ability to send cash to a trustworthy DEX Proxy.
On December 12, the SlowMist team reported that the OKX DEX Proxy Admin Owner upgraded the DEX Proxy contract with a new implementation. The purpose of this new implementation was to invoke the claimTokens function straight from the DEX contract.
The exchange said that 18 of the approved addresses for the contract had been compromised, and linked the event to the management rights of a cancelled OKX DEX market maker contract being compromised.
Additionally, the exchange pledged to pay back all impacted users. It would also carry out a comprehensive security examination in order to stop something similar from happening again.
We regret to inform you that a deprecated smart contract on OKX Dex has been compromised. We have taken immediate action to secure all user funds and revoke the contract permissions. We are working with relevant agencies to locate the stolen funds and will reimburse affected… pic.twitter.com/zDIjhb3ETz
— OKX Web3 (Wallet | DeFi | NFT) (@okxweb3) December 13, 2023
OKX Hack: Actual Damages Unknown
According to PeckShield, another researcher specializing in blockchain security, this vulnerability has cost over .76 million.
In the last 30 days, OKX DEX is thought to have had over 50,000 active user wallets; however, it is unknown how many users were impacted by the most recent hack.
Users should employ caution while communicating with DeFi protocols, especially those supported by well-known firms in the industry, as highlighted by the OKX DEX breach.
Featured image from Shutterstock
Tether Implements New Stablecoin-Freezing Policy After Seizing Funds Tied to OFAC Sanctioned Entities
Tether, a leading stablecoin company in the crypto industry, has announced a significant new initiative aimed at strengthening the security of the crypto asset ecosystem. The company announced this weekend that its recent move to voluntarily freeze tether-holding wallets linked to the Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) List marks a proactive step towards combating illicit activities.
Tether Cracks Down on Illicit Transactions
This decision, made by Tether on December 1, 2023, supplements existing security protocols and aligns with global regulatory standards, according to the company’s announcement on the subject. Tether’s latest action includes freezing wallet addresses previously added to the SDN List, reinforcing its commitment to prevent misuse of its tokens.
Paolo Ardoino, the CEO of Tether, emphasized the strategic nature of this decision. “This strategic decision aligns with our unwavering commitment to maintaining the highest standards of safety for our global ecosystem and expanding our close working relationship with global law enforcement and regulators,” Ardoino stated.
The Tether CEO continued:
By executing voluntary wallet address freezing of new additions to the SDN List and freezing previously added addresses, we will be able to further strengthen the positive usage of stablecoin technology and promote a safer stablecoin ecosystem for all users.
Tether’s history of USDT freezing is not new. Previously, the company has blacklisted numerous addresses involved in suspicious transactions. These actions have included freezing over 30 USDT addresses that moved billions, as reported by the blockchain intelligence firm Chainargos. These measures were part of Tether’s ongoing collaboration with law enforcement, including the U.S. Department of Justice (DOJ), to combat illegal activities.
In one notable instance, Tether voluntarily froze 5 million in USDT linked to human trafficking groups in Southeast Asia. This action, hailed as the “largest-ever freeze of USDT,” showcased the company’s active role in preventing the misuse of its currency. Additionally, Tether seized million in assets stolen in pig butchering scams, working closely with the DOJ and U.S. Secret Service.
Tether’s stablecoin is widely utilized, and among the 11,000-plus digital assets in the cryptocurrency market, it stands out with one of the highest levels of daily transactions, trading volumes, and settlements. In a recent development, the company’s U.S. dollar-tied token, USDT, achieved a sizable market valuation of billion. Notably, the tokens operating on Ethereum and Tron networks are typically always experiencing substantial activity.
What do you think about Tether’s new asset freeze policy? Tell us in the comments section below.