The Breakdown First Five - Thursday, January 18, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. ETF Inflows Hit $1B

With just three days of trading in the books, new Bitcoin ETFs have accumulated almost $1B in net inflows. That’s including outflows from GBTC, which were more than offset. Wednesday added even more as AUM for the 10 new products approaches $3B. Volumes have been insanely high, with nearly $10B traded. Coinshares reports net outflows globally so far this week, implying that many investments in international funds are being shifted to the US ETFs.

4. Winter Storm Hikes Fees

Bitcoin hashrate plunged an estimated 25% on Friday as Texas miners curtail during a major storm. The grid regulators have sent curtailment requests across the weekend and appear to have prevented blackouts due to Bitcoin miners shutting down. Blocks have slowed and fees are up, but it’s worth it to keep emergency heating operational in the Lone Star State. 

3. EU Backdoor Wallet Ban Coming?

The EU has enhanced scrutiny on self-hosted wallets in new AML guidance. The guidelines will apply to crypto firms and require them to identify financial crime risk. Firms were directed to keep an eye on DeFi, anonymity enhancing features and self-hosted wallets. Bans might not be necessary if the threat of regulatory scrutiny becomes severe enough. 

2. Dimon Hates Bitcoin: Davos Edition

JP Morgan CEO Jamie Dimon still hates Bitcoin, even when he’s in the Swiss Alps. This time he said he defends our right to “do Bitcoin” but gave personal advice not to get involved. “Pet rock”, “does nothing”, it’s all so tiresome. Dimon suggested that “Satashi” will return to increase supply or delete it all, but at least he said this is the last time he will publicly comment on Bitcoin. 

1. Coinbase v SEC

Over a five hour hearing the Judge questioned both parties in the Coinbase v SEC lawsuit. Coinbase is attempting a long shot for the case to be decided now, rather than continue to trial. The Judge found staking unlikely to be a security, but was less sure on tokens. SEC thinks they have jurisdiction over tokens but could not explain where their authority ends, leading to a discussion of Beanie Baby securities. Deeply engaged Judge said she cares about the outcome. 

Thanks for reading -NLW