KEY TAKEAWAYS
- Bitcoin Breaks Ether Rises rose to an all-time high above $69,000 last week and surged above $72,000 on Monday morning, as spot bitcoin ETF activity has remained high.
- MicroStrategy bought more bitcoin, propelling its stock, while Blackrock’s spot bitcoin ETF IBIT continues to see significant inflows.
- After the SEC announced a settlement with former crypto exchange ShapeShift, two commissioners from the agency questioned the lack of regulatory clarity for the industry in the U.S.
- In a congressional hearing, Federal Reserve Chairman Jerome Powell indicated the central bank is nowhere near implementing a central bank digital currency.
- This week, some of the attention may move from Bitcoin to Ethereum, as the alternative crypto network is scheduled to have its Dencun upgrade.
What Happened in Crypto Markets Last Week?
On the heels of price momentum from last week, when it hit two all-time highs, Bitcoin Breaks Ether Rises (BTC) rocketed beyond $72,000 this morning, achieving another price milestone. Amidst hopes for reduced costs following Wednesday’s highly-anticipated Dencun update to the Ethereum network, which will aid in improving transaction processing rates at scale, ethEtherowly rose beyond $4,000, according to market analysts. Federal Reserve Chairman Jerome Powell made it explicit that there are no immediate plans to develop a central bank digital currency (CBDC) for the U.S. dollar. Two SEC commissioners expressed their dissatisfaction with the current state of crypto regulations. Sn the US.
Bitcoin Hits a New All-Time High on the Back of ETFs
Some have speculated that the impending halving event and the recent launch of spot bitcoin ETFsU.S.n the US are to blame for bitcoin’s current rise to several all-time highs. The biggest cryptocurrency by market cap had steep drops after each peak, although it eventually recovered part of its losses. The excitearoundU.K.d the UK regulator’s easing position to permit cryptocurrency exchange-traded notes (ETNs) in the country may be what puBitcointcoin beyond $72,000 on Monday.
Requests from Recognized Investment Exchanges (RIEs) to estaU.K.ish, a UK-listed market segment for crypto asset-backed Exchange Traded Notes (cETNs), will not be opposed by the Financial Conduct Authority (FCA). Only investment businesses and credit institutions authorized or licensed to operate in financial markets would have access to these products, according to a statement from the London Stock Exchange.
Blackrock’s Bitcoin ETF and Mirco Strategy are Big Bitcoin Buyers
Over the past couple of months, Blackrock’s iShares Bitcoin Trust (IBIT) has become a significant hub of Bitcoin Breaks Ether Rises trading activity, as its bitcoin stash temporarily grew larger than MicroStrategy’s (MSTR) last week.23 However, MicroStrategy announced the acquisition of another 12,000 bitcoins on Monday, taking their current balance to 205,000.
Additionally, the nine new ETFs have grown to a combined size larger than Grayscale Bitcoin Trust (GBTC), according to BitMEX Research. GBTC has experienced over $10 billion in outflows since its conversion to an ETF. Notably, Grayscale’s offering has much higher fees of 1.5% than the other nine spot bitcoin ETFs currently on the market.
Bitcoin Price Powering Gains For Some Crypto-Related Stocks
MicroStrategy’s investment in Bitcoin is yielding outstanding results. At roughly $1,650 in Monday’s early afternoon trading, MicroStrategy shares were up 16%. There has been a 600% increase in the stock price in the last year and a 140% increase since the beginning of 2024. Shares of MicroStrategy are a solid choice for investors looking to get exposure to Bitcoin, says Michael Saylor, executive chairman of the business. “If you’re interested in Bitcoin and want to buy it at its all-time high, how can you protect yourself from its potential downside while benefiting from its potential upside?”
In an interview with CNBC on Monday, Saylor revealed that MicroStrategy had sold $800 million worth of debt and that the company’s financial sheet included $12–$13 billion worth of bitcoin. “If you’re a bitcoin maximalist and you love Bitcoin Breaks Ether Rises and you want it to hold forever, the ETFs charge you 25 basis points, MicroStrategy is accreting—we’re giving you a yield against your shares in a tax-efficient fashion.” The bitcoin surge has benefitted Coinbase (COIN) and other stocks. The cryptocurrency exchange stock has increased by over 15% in the last five days and by nearly 70% so far this year, despite specific issues caused by extremely high trading volumes in the previous two weeks.
SEC Commissioners Criticize Agency’s Crypto Stance
Even fellow commissioners of the Securities and Exchange Commission (SEC) criticized the agency’s move against Shapeshift, a platform that traded digital assets. SEC commissioners Hester Peirce and Mark Uyeda questioned the lack of clarity over which tokens constituted securities, even though ShapeShift agreed to pay $275,000 for allegedly enabling exchanges of unidentified digital assets designated securities.
They contended that clarity hinders innovation since crypto companies struggle to determine whether regulations have been met. Claiming that “cases like this do not protect investors; they intimidate innovators and entrepreneurs,” Peirce and Uyeda clarified their position. “With due respect, we disagree. Coinbase and Kraken are among the companies that have been sued by the SEC for operating unregistered securities exchanges; the commissioners’ statement echoes their frustrations.
Fed Chair Powell Says No Reason to Worry About CBDC
Last week, Federal Reserve Chairman Jerome Powell gave evidence before Congress and addressed worries about oil. “We’re nowhere near recommending or adopting a central bank digital currency in any form,” Powell stated. By stressing that any efforts to create digital currency would function within the current banking system, Powell hoped to allay fears that a CBDC may give the Fed the power to compete with private banks or to spy on individuals’ financial transactions. He made these comments amid ongoing discussions over privacy and the potential effects of digital currencies backed by central banks on the economic system, as well as legislative attempts to stop the Federal Reserve from issuing CBDCs without congressional approval.
What to Expect from Ether Network Upgrade
For the first time since December 2021, the price of Ether (ETH) has surpassed $4,000 ahead of this week’s Deneb-Cancun (or Dencun) network upgrade. With Monday’s gains, EthEther is up over 4% and is up over 70% so far this year. Fidelity Digital Assets reports that some layer-two network protocols developed on top of the Ethereum blockchain should significantly reduce their costs after the upgrade.
