The Breakdown First Five - Thursday, February 29, 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. Gemini Creditors to Receive 100% Recovery

Gemini have settled their lawsuit with the NYDFS, agreeing to pay a $37M fine and ensure that creditors receive at least $1.1B from the Genesis bankruptcy. Separately, Gemini have announced a settlement with Genesis and other creditors which they say will result in creditors receiving 100% of digital assets returned in kind. This is a massive win for creditors, with most other crypto bankruptcies resulting in dollarized claims and massive haircuts. 

4. Binance Execs Arrest Rumors in Nigeria

A pair of Binance executives have been detained in Nigeria amid a currency crisis. The government is blaming the collapse of the Naira on speculators and are pinning the blame on the nation’s most popular crypto exchange. The Central Bank Governor said that $26B has passed through Binance “from sources and users who we cannot adequately identify.” The Naira is down 40% this year with inflation running at 30%.

3. ETFs Blow Out Records

This week has seen record ETF volume every day. Yesterday saw those records doubled. $7.7B was traded among the ten products, with Blackrock by itself generating 43.5%. Between them, Bitcoin ETFs did more volume than QQQ, the Nasdaq Index fund. Eye-popping volume was converted into record flows, with $673M added to the funds, including a larger than normal $216M outflow from GBTC. Unprecedented success is now an understatement.

2. Coinbase Breaks the Chart

Coinbase had a technical failure cutting yesterday’s rally short. Panicked holders logged in to see their balances zeroed out and trading was impossible. Coinbase crashes were a constant problem during the 2020 runup, but haven’t been seen in years. Many blamed a lack of preparedness for an influx of customers, however the exchange claimed they had enough capacity for a 10x surge in usage. Was yesterday the return of the retail trader?

1. Bitcoin Shoots Up to $64,000

Bitcoin had its best daily performance since October, topping out at $64,000. The volatile day saw Bitcoin shoot up by 5% before collapsing by 8%, all in the same 90-minute window. $700M in liquidations reset open interest by $1.7B. The largest leverage shakeout since August.  February looks set to close the best monthly candle since December 2020, currently sitting at a 45% gain. Opinions are mixed on whether markets are overextended or all time highs are in sight.