Last week was quite a ride, with reports and news of the Israel - Hamas conflict and persistent inflation being felt as some investors moved away from riskier assets to hedge themselves against all the uncertainty. The market has since mostly recovered from last week’s negativity, though that’s far from the only news of the week.
Here’s a recap of some of the recent events in case you missed anything.
Making Headway for a Spot Bitcoin ETF
U.S SEC Won't Appeal Loss in GBTC Case
The SEC has made a crucial decision in the path toward approving a Spot Bitcoin ETF. The regulatory body has chosen not to appeal a court order that required it to review Grayscale's application to convert its Bitcoin Trust into a spot Bitcoin ETF.
In the wake of the SEC's move, the Grayscale Bitcoin Trust (GBTC) discount has plunged to a new low for the year, reaching 15.88%. The closing of the discount suggests a lot of investor optimism, and when considering Grayscale’s win against the SEC earlier this year and now the SEC’s decision to not appeal the court order, market experts estimate a 90% likelihood of SEC approval for spot Bitcoin ETFs following this development.
Ark Invest’s ETF Application Takes a Positive Step
Cathie Woods' Ark Invest recently refiled its application for a Bitcoin spot exchange-traded fund (ETF). This move signifies a commitment to provide investment opportunities for those who wish to participate in Bitcoin's growth without directly holding the digital asset themselves.
The new filing includes environmental considerations and the potential impact of illicit transactions on the Bitcoin industry, as well as a multitude of other small changes coming as a reply to the SEC’s comments. According to Bloomberg's ETF expert, Eric Balchunaus, this is seen as a positive step and solid progress toward the industry's first spot Bitcoin ETF approval.
All in all, the odds of a Spot Bitcoin ETF arriving soon have never looked better.
Ferrari Embraces Bitcoin
Luxury car manufacturer Ferrari has announced that it now accepts cryptocurrency payments for its vehicles in the United States. Customers can use Bitcoin, Ethereum, and USDC to purchase their dream cars.
This decision is part of Ferrari's strategy to connect with a younger and wealthier demographic and align with its carbon neutrality goals and was also prompted by the growing market and demand for cryptocurrency payment options. To facilitate cryptocurrency transactions, Ferrari has partnered with BitPay. Further, Ferrarri has confirmed that they will not impose extra fees for these cryptocurrency transactions, and that they intend to expand this service to the European Market.
SEC Under Pressure
Coinbase is intensifying its efforts to prompt a response from the U.S. Securities and Exchange Commission (SEC) regarding its rulemaking petition. The crypto exchange seeks clarity, either approval or denial of its petition, aiming to prevent further delays from the SEC.
Coinbase's Chief Legal Officer has criticized the SEC's unilluminating response and advocates for regulatory clarity in the crypto industry. This development comes amid a series of legal disputes between Coinbase and the SEC.
Global Efforts to Curtail Hamas Crypto Funding
Hamas, a militant organization considered a terrorist entity by many countries, is utilizing cryptocurrency to finance its operations. On-chain data suggests that a significant amount of crypto has been acquired by Hamas, with a recent report from Elliptic pointing out over $41 Million had been accumulated by Hamas-linked addresses between 2020 and 2023.
However, much of it has since been seized by Israeli authorities. Global efforts between US, Israel, and UK agencies along with Binance have been actively tracking and seizing Hamas-linked crypto assets, underscoring the ongoing challenge of preventing illicit funding through cryptocurrencies. In response, legislators like Elizabeth Warren are pushing for stronger crypto regulations to combat terrorism financing.
New Tether CEO
Tether, the largest stablecoin by market cap, has announced a change in leadership. Paolo Ardoino, the current Tether Chief Technology Officer (CTO), is set to take over as the Chief Executive Officer (CEO) from December 2023. He will succeed Jean-Louis van der Velde, who will transition to an advisory role.
Ardoino, known for his extensive experience in the Web3 space and previous roles at Bitfinex and Tether, is expected to bring his visionary leadership to Tether as its new CEO. This leadership shift indicates potential new directions for the stablecoin and the cryptocurrency industry.
JPMorgan Forecasts Bitcoin Hash Rate Drop
JPMorgan has released a report forecasting a 20% drop in the Bitcoin Network Hash Rate following the Bitcoin halving scheduled for April 2024. This decline is anticipated due to the decommissioning of less efficient hardware in the Bitcoin mining industry.
The Bitcoin halving, occurring every four years, involves cutting miners' rewards by half to mitigate inflation. JPMorgan designates CleanSpark as its top pick among BTC mining firms, despite Marathon Digital being the largest operator. The report emphasizes the impact on the overall Bitcoin mining ecosystem.
Genesis Settles with FTX for $175 Million
The United States Bankruptcy Court for the Southern District of New York recently approved a settlement between FTX and Genesis. In this agreement, Genesis debtors are set to pay $175 million to FTX, a far cry from the originally claimed amount of $3.9 billion by FTX debtors in May.
Genesis considers this court-approved settlement as "fair and equitable.". However, FTX creditors have expressed dissatisfaction and called on the Official Committee of Unsecured Creditors of FTX to contest the agreement.
This legal battle dates back to the collapse of FTX in November 2022, which had widespread implications in the crypto industry that are still being felt today. Genesis became entangled due to its financial connections with FTX, eventually leading to a halt in withdrawals and a bankruptcy filing in January 2023.