In this week’s crypto highlights, we explore price movements and other notable industry news items that occurred over the last seven days. Without further ado, let’s dive into the latest market developments.
Market spotlight: Bitcoin jumped above $70,000, moving out of the consolidation pattern
In our previous weekly overview, we noted moderate optimism within the Bitcoin market, despite a slight price decrease. This week, sentiment has grown even more positive:
- U.S. spot Bitcoin exchange-traded funds (ETFs) recently registered the second-highest recorded daily inflows, and are within striking distance of their longest streak (17 days).
- Thailand’s securities regulator approved the first spot Bitcoin ETF in the country, while the first ETF with direct Bitcoin holdings began trading in Australia.
- Large purchases of Bitcoin call options, with a strike price above $74,000 in June, suggest that market players anticipate the asset reaching a new all-time high this month.
These factors likely contributed to Bitcoin’s bounce off the lower border of the symmetrical triangle, breaking upwards from the pattern. The latter suggests that a consolidation period might be ending, with upward movement potentially following. The pattern’s price target is near $76,000, which surpasses the current all-time high.
However, several factors could limit Bitcoin’s potential. June is historically the second-worst month for Bitcoin in terms of price performance, and is typically accompanied by decreased liquidity. This could lead to increased volatility, and/or limit established momentum.
In addition, Bitcoin futures premiums moved out of the neutral range, hitting a seven-week high. Open interest in Bitcoin futures markets also surged, indicating significant leverage, which could result in increased liquidations. With the market predominantly optimistic, and more long positions in place, cascade liquidations could occur, causing a whipsaw.
In summary, a combination of potentially decreased liquidity, increased leverage, and expectations of a new all-time high sound like a theoretical recipe for a massive move ahead. While a bullish outcome appears more likely, there is a risk that Bitcoin may not reach a new all-time high if there isn’t enough momentum, and/or if ETF inflows slow down.
Noteworthy market events
U.S. spot Ether ETFs accelerated toward their launch
A few weeks ago, the U.S. Securities and Exchange Commission (SEC) approved eight spot Ether ETFs, though their launch is still pending due to a bureaucratic nuance. Over the last week however, there’s been some progress in this domain, bolstering anticipation of their launch:
- BlackRock, Franklin Templeton, VanEck, and Invesco Galaxy filed updated S-1 forms, required for their spot Ether ETFs to begin trading.
- Depository Trust & Clearing Corporation (DTCC) has already listed Fidelity’s, VanEck’s, Franklin Templeton’s, and BlackRock’s spot Ether ETFs. This step is considered one of the final ones before the launch of said products.
- Grayscale filed an updated S-3 form to convert its ETHE trust into a spot Ether ETF.
- In a newly amended S-1 form, the previously named Ark 21Shares Ethereum ETF was changed to 21Shares Core Ethereum ETF. This indicates that Ark will not proceed with an Ether ETF application, leaving its former partner 21Shares to continue independently.
- Hashdex has withdrawn its Ether ETF application.
Amid all this news, Bloomberg analyst Eric Balchunas stated that the launch of spot Ether ETFs by the end of June is “a legit possibility.”
Mastercard’s Crypto Credential service went live with pilot crypto P2P transfers
Mastercard rolled out a pilot of its Crypto Credential service, letting users in Latin America and Europe conduct peer-to-peer crypto transfers. This service enables customers to utilize personalized crypto addresses instead of typical blockchain addresses. Such a feature is akin to the Ethereum Name Service (ENS), and is dedicated to facilitating the transaction process.
As part of Mastercard’s Crypto Credential standards, users are verified and receive an alias for transactions. The system checks the recipient’s alias and wallet compatibility, resembling a paranoid friend who triple-checks everything. If there’s a hiccup, it gives users a heads-up to prevent any “Oops, wrong wallet!” moments.
Japanese exchange DMM Bitcoin suffered an over $300 million hack
The crypto industry recently experienced the eighth-largest crypto theft in its history, bigger than any of 2023’s exploits.
In a blog post, Japanese crypto exchange DMM Bitcoin disclosed a security breach that resulted in the loss of approximately 4,503 BTC, valued at around $308 million at the time.
The exchange temporarily halted new account openings, new spot buy orders, and all new leveraged orders. In addition, the processing of crypto withdrawals has been suspended. Withdrawals in Japanese Yen are still being processed, albeit more slowly than usual.
DMM Bitcoin assured customers that all BTC deposits are guaranteed, and the company has shared a funding plan to cover losses.
Notably, DMM Bitcoin is not the only Japanese crypto exchange that has suffered a substantial hack. Some of the most prominent examples are Mt.Gox’s 2014 incident, which still affects the industry, and Coincheck’s 2018 hack, which is considered the largest crypto heist in Japan’s history.
Uniswap hit the snooze button on a fee-switch proposal vote
On May 31, the Uniswap Foundation postponed a vote regarding UNI staking and delegation rewards, because an unnamed stakeholder “raised a concern.” The organization highlighted the need for thorough due diligence due to the irreversible and sensitive nature of the proposed upgrade, but it didn’t specify a new timeline for the vote.
The delay hasn’t won any popularity contests in the crypto community. Some critics claim the governance process is being manipulated, while others see this delay as a potential threat to decentralization.
Despite the foundation calling the decision “unexpected” and offering apologies, this isn’t their first time rescheduling a vote on the “fee switch.” This proposal would redirect a modest amount of protocol trading fees to token holders. It seems like the interests of token holders are once again at odds with certain Uniswap “stakeholders,” making for some family drama at the decentralized dinner table.
One sentence news
- BlackRock’s IBIT surpassed GBTC as the world’s largest Bitcoin ETF.
- PayPal’s PYUSD stablecoin is now available on the Solana network.
- Gemini announced a distribution of $2.18 billion to its Earn program users.
- The EOS community approved a proposal to cap the token supply at 2.1 billion tokens, meaning that nearly 80% of the total EOS supply will be burned.
- U.S. President Joe Biden vetoed the SAB 121 repeal, sparking criticism from crypto industry members.
- Artificial Superintelligence Alliance’s token merger, which includes FET, AGIX, and OCEAN tokens, will be completed on June 13.
Notable price performances
- TON and BNB updated their all-time highs, becoming the only assets in the top 10 to show double-digit gains this week.
- ORDI and STX enjoyed over 20% price increases, following renewed interest in Bitcoin-based BRC-20 tokens.
- FLOKI price surged by 30% in a week, amid another $12 million investment from DWF Labs into the Floki ecosystem.
- JASMY saw a 50% price jump, arguably due to speculation that Apple partnered with the project. However, this information remains unconfirmed.
Tune in next week, and every week, for the latest CEX.IO crypto highlights. For more information, head over to the Exchange to check current prices, or stop by CEX.IO University to continue expanding your crypto knowledge.
Disclaimer: For information purposes only. Not investment or financial advice. Seek professional advice. Digital assets involve risk. Do your own research.