Quick Take

• US spot Ethereum ETFs saw US$342 million net outflow last week, while spot Bitcoin ETFs had a weekly net inflow of $535 million; Crypto.com featured Bitcoin on the Sphere in Las Vegas; Franklin Templeton and SBI are establishing a crypto ETF management firm.

• On the macro side, the Bank of Canada cut interest rates by 0.25% to 4.5%, while China surprised markets by cutting its lending rate for one-year medium-term policy loans by 0.2% to 2.3%. In the US, personal consumption expenditures in June rose 2.5% year-on-year (YoY), in line with expectations. This is lower than the 2.6% YoY growth in May, suggesting price hikes may be slowing. In addition, the US Q2 GDP came in stronger than expected; Real GDP increased 2.8% YoY, compared to the Dow Jones estimate of 2.1%. The latest CME FedWatch Tool shows a 100% probability of a September rate cut in the US. 

• Notable updates: Filecoin announced its v23 upgrade scheduled for 6 August; Maker shared an Endgame overview outlining the upcoming Launch Season; BGD team by the Aave community announced a new version of the Aave safety module; Jito released the code for restaking; the Crypto.com App listed Drift (DRIFT).

• Notable events in the coming week: Interest rate decisions from the US, UK, and Japan.

Weekly Market Index

Price and volatility indices decreased by -6.08% and -0.22% last week, respectively. Volume index increased by +6.79%. Price decrease was led by AVAX (-12.00%).

Check price

Chart of the Week

Nine US spot Ethereum ETFs commenced trading on 23 July, marking another milestone for the cryptocurrency industry. The ETFs saw a net inflow of $107 million on the first day, but experienced net outflows in the remaining three days of the week. All the net outflows were from Grayscale’s converted fund, ETHE, with a total outflow of $1.5 billion last week. This surpassed the $1.2 billion net inflows from the remaining eight ETFs, which resulted in an overall net outflow of $342 million from 23 to26 July. 

In comparison, US spot Bitcoin ETFs had a net inflow of $655 million on the first trading day and $1.3 billion in the first four trading days, according to data from Farside investors.

Weekly Performance

BTC increased by +0.6% while ETH decreased by -6.6% in the past seven days. The price action for most other selected top market capitalisation tokens was down. LDO (-17.8%) led the drop while SOL led the increase (+4.9%).

Key categories were all down in market capitalisation in the past seven days. The gaming category led the drop.

Notable Token Updates

News Highlights

ETFs and Funds

• Franklin Templeton and SBI Holdings are partnering to establish a crypto ETF management firm. The new Japanese asset management firm aims to offer investors greater access to more diversified investment vehicles; for example, providing young investors with access to crypto-based ETFs. 

• The municipal pension plan of Jersey City will soon invest in Bitcoin ETFs, according to a social media post from Mayor Steven Fulop. It is in the process of updating paperwork with the US SEC to allocate a portion of the fund in the ETFs. In addition, the Michigan pension fund disclosed holding 110,000 shares of ARK 21 Shares Bitcoin ETF (ARKB), worth $6.6 million at the time of filing on 30 June. 

• Hong Kong launched Asia’s first inverse Bitcoin ETF on 23 July. Launched by CSOP Asset Management, the ETF is named CSOP Bitcoin Futures Daily (-1x) Inverse Product (7376.HK) and allows investors to bet on a drop in Bitcoin’s price. 

• Libre, a tokenisation-focused joint venture between incubator WebN Group and Nomura’s Laser Digital, is adding blockchain-based funds to Solana. The funds that are available on-chain include the Hamilton Lane SCOPE fund, Brevan Howard Master Fund, and Blackrock ICS Money Market Fund.

Regulations

• India is set to release a discussion paper on its policy stance on cryptocurrencies in September. The paper aims to put forward a position on cryptocurrencies based on stakeholder views and consensus on the matter.  

• Argentina’s regulator, the Securities and Exchange Commission (CVM), mandated crypto exchanges to apply for operating permits and sign up to the Virtual Asset Service Providers Registry (PSAV). Vendors have 45 days to comply with the rules. 

Others

• Bitcoin appeared on the Sphere in Las Vegas last Monday, featured by Crypto.com. This is the first cryptocurrency to debut on the Sphere. 

• Toyota is exploring how the ERC-4337 account abstraction standard can be used as a foundation for mobility-oriented accounts (MOA). MOA is a public blockchain account for vehicles, which could boost programmability and enable the connection of various services. For example, it can be used to digitally unlock a vehicle and start its engine via a smartphone application.  

• Securitize, the distributor for BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), submitted a proposal  seeking investment from Ethena Labs, the issuer of USDe. Ethena Labs is exploring ways to invest its reserves in real-world assets and has launched a request for proposal (RFP) to evaluate options. Securitize was the first to submit a proposal for Ethena to allocate $34 million to BUIDL. 

• Jingdong Technology Group's  subsidiary, Jingdong Coinlink Technology Hong Kong Limited, announced plans to issue a 1:1 stablecoin linked to the Hong Kong Dollar (HKD), aiming to provide businesses with efficient and secure payment solutions. The company is currently a Sandbox participant of the Hong Kong Monetary Authority (HKMA), but it cannot be considered “endorsed or granted or deemed to be licensed to issue stablecoin”. 

• Tesla and SpaceX hold over $1 billion in Bitcoin. Tesla reportedly held $640 million worth of BTC with no sales as of its Q2 2024 filing, while SpaceX held $550 million worth of Bitcoin.  

Recent Research Reports

• Research Roundup Newsletter [June 2024]: We present our latest issue of Research Roundup, featuring our deep dives into ETH ETFs, GameFi, and New Layer-2s.

• Alpha Navigator: Quest for Alpha [June 2024]: Equities and fixed income were up in June, while cryptocurrencies dropped. The Fed remains cautious on rate cuts, while the ECB cuts rates for the first time in five years.

• New Developments in GameFi: Play-to-Airdrop and Prediction Markets: Both play-to-airdrop and prediction markets have blurred the boundaries between Web2 and Web3. Our latest report delves deeper into these two trends to examine new developments in GameFi.

Recent University Articles

• What Is LayerZero and How to Buy the ZRO Token: LayerZero is a groundbreaking omnichain for secure cross-chain transactions and interoperability between major blockchains.

• Shiba Inu: A Beginner’s Guide to the Cryptocurrency’s Ecosystem: Shiba Inu has evolved far beyond the SHIB token and now boasts a metaverse, DeFi capabilities, NFT collections, and a synergised token network.

• What Is MakerDAO (DAI)?: Learn about MakerDAO, the DAO of DAOs, and its stablecoin, DAI — including how to use, trade, and create it.

Catalyst Calendar

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