Bloomberg - Evening Briefing - The frenzy is back

Bitcoin pushed past $60,000 for the first time in more than two years on Wednesday and has jumped about 40% already in 2024. The feeling has been that maybe things are different this time around. The current rally was triggered mostly by the successful launch of US exchange-traded funds that hold the coins—vehicles that have attracted more than $6 billion since they began trading Jan. 11. But at the heart of this particular rally is a simple tenet of economics: Supply and demand. The surge in demand for the cryptocurrency resulting from new ETFs is vastly outstripping the supply of new tokens being created in the mining process, as well as the Bitcoin long-time holders are willing to sell. That is what’s set the crypto market on fire of late, with fuel being added from traders chasing the upward momentum and loading up on leveraged bets that the surge will continue. —David E. Rovella

How frenzied is it out there? Some $520 million flooded into BlackRock’s Bitcoin ETF in just one day. The iShares Bitcoin Trust saw its biggest one-session haul Tuesday, marking the largest daily inflow so far among the batch of new ETFs tied to the digital asset. It was also the second-largest daily intake for any US ETF across all asset classes, data compiled by Bloomberg show.  

The US Supreme Court said on Wednesday that it would further delay the federal criminal prosecution of Donald Trump over his alleged role in a wide-ranging scheme to subvert American democracy, the most grave of four felony prosecutions he faces. The high court, dominated by a supermajority of six Republican appointees including three picked by Trump, will consider the twice-impeached former president’s claim of immunity tied to a grand jury indictment obtained by Special Counsel Jack Smith. An appeals court made up of Democratic and Republican appointees earlier rejected Trump’s claim.

Jack Smith, US special counsel, departs from a news conference in Washington last August.  Photographer: Al Drago/Bloomberg

Senate Minority Leader Mitch McConnell of Kentucky, who is stepping down from the role, has no place in this Republican Party. It belongs to Trump, Nia-Malika Henderson writes in Bloomberg Opinion. Ronald Reagan’s wing of the party is moribund, crushed by MAGA, she writes. And so McConnell will step down from his leadership post, bowing to the reality of his own irrelevance.

Three Federal Reserve officials said the pace of interest-rate cuts will depend on incoming economic data, suggesting the path to lower borrowing costs may look different than in previous rate-cutting cycles. Boston Fed President Susan Collins and New York’s John Williams said the Fed’s first rate cut will likely be appropriate “later this year,” while Atlanta’s Raphael Bostic said he’s currently penciling in a cut for sometime this summer. But the policymakers also offered some insight into how the Fed will assess the timing of future rate reductions. “With respect to rate cuts and pace, it’s got to be driven by economic conditions, as well as inflation,” Williams said.

John Williams  Photographer: Victor J. Blue/Bloomberg

Chinese regulators are said to be taking steps to gradually shrink the size of a popular quantitative trading strategy that contributed to turmoil in the nation’s stock market this month. Some quant funds that manage “Direct Market Access” products for external clients were told to stop accepting new inflows and phase out their existing products, which typically use swap contracts and are often highly leveraged. The gradual exit would help prevent drastic selloffs. The move “reflects a continued drive to deleverage in the market, and affects sentiment across the board,” said Chen Zunde, fund manager at Guangdong Fund Investment. Such deleveraging though “could lead to an extended drop and might be a replay of the slump in January.”

Electronic Arts said it’s terminating 5% of its employees, or about 670 people, continuing this year’s tech industry bloodletting. EA will also cease development on an undisclosed number of games and pull back on its real estate holdings, the game publisher’s chief executive, Andrew Wilson, told staff in a memo. Wilson added that the company will be “moving away from development of future licensed IP that we do not believe will be successful in our changing industry.”

Snowflake tumbled in late trading after the software maker delivered a forecast that missed analysts’ estimates and announced that Chief Executive Officer Frank Slootman is stepping down from the role. Product revenue will be $745 million to $750 million in the first quarter, Snowflake said Wednesday. Analysts had predicted $769.5 million on average, according to data compiled by Bloomberg. A full-year forecast also fell well short of projections. The challenge of reinvigorating Snowflake will fall to the company’s senior vice president of AI, Sridhar Ramaswamy.

• Lawmakers reach deal to avert US government shutdown.
• Trump told by court he can’t delay paying his $454 million fraud fine.
• This is where new migrants are going when they reach the US.
• Canada’s “student trafficking” industry is backfiring on Trudeau.
• How Panera Bread ducked California’s new $20 minimum wage law.
• Bloomberg Opinion: Going “California Sober” may be bad for your heart.
• Google in “terrible bind” after pulling AI feature amid right-wing attacks.

Since the beginning of the year, the business of cinemas has been a shell of what it was 12 months ago. Although films with relatively modest budgets have recently outperformed expectations, it’s mostly been a—ahem—desert for big-budget megahits in 2024. Enter Dune: Part Two, the long-awaited sequel of an epic remake of the original film based on the legendary novel. It opens on March 1.

Timothée Chalamet in Dune: Part Two. Photographer: Niko Tavernise

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Bloomberg Power Players Jeddah: Set against the backdrop of the Formula One Saudi Arabian Grand Prix, Bloomberg Power Players Jeddah on March 7 will bring together some of the most influential voices in sports, entertainment and technology as we identify the next potential wave of disruption for the multibillion dollar world of sports, media and investment. Join powerbrokers, senior executives, leading investors and world-class athletes who are transforming the business of sports. Learn more.