The biggest crypto news and ideas of the day |
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ETH Worth the Risk - Bernstein |
Ether (ETH) has underperformed its larger rival bitcoin (BTC) year-to-date, but ETH exchange-traded fund (ETF) inflows have inflected suggesting this period of underperformance may be over, broker Bernstein said in a research report on Monday.
The broker noted that on Friday Blackrock's spot ether ETF saw inflows of $250 million, versus only $137 million of inflows for the asset manager's larger spot bitcoin ETF. "This creates favorable demand-supply dynamics for ETH," analysts led by Gautam Chhugani wrote. Staking yields could be another tailwind for the cryptocurrency. Bernstein noted that initial ether spot ETF applications did not include yields due to regulatory limitations.
"Under a new Trump 2.0 crypto friendly SEC, ETH staking yield will likely be approved," the authors wrote, adding that as activity on the Ethereum blockchain increases the yield can grow to 4-5%. Ethereum blockchain activity is on the up, and the network remains the platform of choice for asset tokenization and stablecoins, the report said. After Ethereum's transition to a proof-of-stake consensus mechanism, the supply of ether has remained "stagnant" at a total of 120 million tokens, Bernstein said. Ethereum's transaction fees deliver a yield of around 3% to stakers, which keeps about 28% of ether supply locked in staking contracts, the report noted. Another 10% of supply is locked in deposit and lending contracts.
Almost 60% of ether has not changed hands in the last 12 months which is indicative of a "resilient investor base," and this reinforces the positive demand-supply dynamics for the cryptocurrency, the report added. |
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Top Crypto Gifts for 2024 DePIN gadgets. A Web3 phone. A crypto gift card. A programmable hoodie. When it comes to crypto, we normally think of virtual things. But there are plenty of ways to get physical this holiday season. CoinDesk teamed up with DIMO to curate this guide to all things crypto hardware. It contains nine cool hardware ideas, from NFC-encrusted nails to a state-of-the-art wallet to a “burner card” for stablecoins. Enjoy and give the gift of crypto this holiday season. |
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Bitcoin's Illiquid Supply Soars |
The so-called $100,000 sell wall for bitcoin (BTC} is becoming a hard nut to crack, with $384 million available for sale between the current price and that six-figure milestone. A look at the supply data, though, suggests building pressure for an upward move.
"Illiquid supply" refers to the amount of bitcoin that is owned by long-term holders (LTHs) that is not actively traded. According to Glassnode data, illiquid supply has risen by more than 185,000 tokens over the past 30 days and hit an all-time high of 14.8 million BTC, or 75% of the total circulating supply of just under 20 million (only 21 million bitcoin can ever exist). That 185,000 is the second highest 30-day change this year and suggests the main behavior for investors at the moment is holding not trading. Previous research by CoinDesk shows that sales by LTHs are approaching their end. Since Nov. 26, LTHs as a group have been accumulating, adding more than 2,000 BTC to their stacks. This could mean that the period of realizing profits is coming to an end for this cohort, possibly taking further sell pressure from the market. |
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Bitcoin’s Pumping. Memes Are Minting Millionaires. The bear market’s snoozing, and the bull run is here.
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Prices rise Dec. 13 at 10 a.m. ET/ 11 p.m. HKT—save $700 and get an extra 15% off with code NODE15. Don’t miss out. Register today. |
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Microstrategy to Microsoft |
Bitcoin Development Company MicroStrategy (MSTR) is now the owner of nearly 2% of all the bitcoin (BTC) that will ever be created after adding to its holdings of the token.
The firm disclosed the purchase of 15,400 bitcoin over the week ended Dec. 1 for $15.4 billion, or an average price of $95,976 each on Monday. That brings its holdings to 402,100 tokens worth $38.2 billion at the current price of $95,000. The company's overall average purchase price is $58,263.
This most recent buy was funded with share sales under the company's existing at-the-market program, according to the disclosure.
Executive Chairman Michael Saylor once again on Sunday teased the Monday announcement. MicroStrategy's 402,100 tokens amount to more than 1.9% of the 21 million bitcoin that can ever be created.
On Sunday Saylor posted that he gave a 3-minute presentation to the Microsoft (MSFT) board regarding bitcoin investment as a diversification strategy.
Saylor told the board that its current treasury strategy is weakening the company while its daily traded volume is being outpaced by MicroStrategy, according to a presentation he posted on X. As of Nov. 27, taking the average of the past five trading days, Microsoft has generated $9.7 billion in average daily trading volume against MicroStrategy's $22 billion. They both have similar options open interest, despite MicroStrategy being just 2.5% the size of Microsoft.
"If you are going to outperform you are going to need bitcoin, and your bonds are undermining your options market and your equity liquidity," Saylor told the Microsoft board. |
Successful Trading Takes More Than a Bull Market Choosing the right exchange is crucial throughout the business cycle. This has been a very, very good month to trade in crypto. People who regularly read CoinDesk are making money just by checking their phone alerts. And yet, this environment isn’t as kind to the exchanges. Continue reading here. |
Hacked DMM Bitcoin Exchange to Close |
Japanese crypto exchange DMM Bitcoin will shut down and transfer its accounts and assets to trading platform SBI VC Trade in March next year, it said in a statement on Dec. 2.
The decision was made after the exchange suffered a hack in May. Hackers siphoned off over 4502.9 bitcoin (BTC), worth nearly $305 million at the time. DMM Bitcoin had restricted its services such as withdrawals and the acceptance of purchase orders for spot crypto assets since the loss of the funds, but acknowledged that allowing the situation to continue would impair its customers. “We sincerely apologize for the inconvenience caused over such a long period of time,” it said.
Who was behind the theft is not clear – though fingers have been pointed at North Korea’s shadowy cyberhackers the Lazarus Group. Money from the hack also appears to have passed through Huione Guarantee, a Cambodian payments company that has enabled the laundering of billions in illicit funds. SBI VC Trade said that the company would start handling 14 cryptocurrency new spot trading that are already handled by DMM Bitcoin before the transfer of the assets. |
The Takeaway: Why De-Banking Matters |
| By Jorge Jraissati Until last week, the issue of de-banking remained largely an open secret, something known primarily to insiders like myself. As I work to protect people and entities affected by de-banking both in the U.S. and globally, I have witnessed firsthand the devastating economic and social impact this issue has had on businesspeople, nonprofit organizations and “politically exposed persons.” This situation changed as millions of people became familiar with the concept of de-banking after venture capitalist Marc Andreessen appeared on the Joe Rogan podcast. Andreessen discussed the exclusion of politically disfavored individuals and entities from the financial system, focusing specifically on the crypto-assets industry. His remarks triggered a wave of responses, drawing attention to the broader issue of de-banking in the tech and cryptocurrency sectors. Prominent figures like the Winklevoss brothers, known for their contributions to cryptocurrency exchange development, voiced their frustrations. David Marcus, former leader of Facebook’s Libra/Diem project, commented on how the U.S. Treasury Secretary Janet Yellen allegedly pressured Federal Reserve Chair Jerome Powell to dissuade banks from supporting the project (which was started by Facebook). Similarly, Nick Neuman, CEO of Casa, recounted his experience of being de-banked by Silicon Valley Bank. His company, which offers self-custodial services, faced rejection from nearly 50 banks before finally securing a partnership with one institution. In her recently published memoir, former First Lady Melania Trump revealed that a bank abruptly terminated her long-standing financial relationship, and her son Barron was blocked from opening a new account at the same institution. While the bank’s name remains undisclosed, the incident highlights the arbitrary and opaque nature of such decisions. People and entities are being “de-banked” at an alarming rate, meaning their access to financial services is being terminated either by direct political pressures, the weaponization of regulations, or simply as an unintended consequence of other regulations. Read the rest here. |
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