• Institutions have been buying cryptocurrency following the recent market slump, according to data from FalconX.
• Bitcoin trading volume is almost three times higher than Ethereum’s among institutional investors.
• Various types of institutional investors, including proprietary trading desks, hedge funds, and venture funds, were net buyers during the dip.
• The crypto market recovery coincides with a broader market sell-off that affected major stock indices.
• FalconX’s head of research, David Lawant, indicates that institutional investors see a positive medium and long-term outlook for crypto assets despite short-term volatility.

In the wake of a significant cryptocurrency market correction that wiped out approximately $230 billion in value, institutional investors have emerged as key players in buying the dip.

This trend, highlighted by crypto trading and institutional brokerage firm FalconX, suggests a strong belief in the long-term potential of digital assets despite short-term market turbulence.

According to FalconX, interest in Bitcoin “remains elevated” among institutional investors, with trading volume for the leading cryptocurrency nearly tripling that of Ethereum. This disparity in trading volumes indicates a clear preference for Bitcoin among institutional buyers during market downturns.

1/3 As one of the most active institutional desks in crypto, the past few days have been busy. Here is a high-level color of our flows over the past few weeks and today.

TLDR: Institutions are buying the dip.

— FalconX (@falconxnetwork) August 6, 2024

David Lawant, head of research at FalconX, told Decrypt,

“The overall mood among institutional investors is that, despite the many short-term crosscurrents, the outlook for the asset class remains very positive in the medium and long terms.”

This sentiment is reflected in the buying patterns observed across various types of institutional investors.

FalconX’s data reveals that proprietary trading desks represented 57% of total buy-side flows, while hedge funds accounted for 63%. Venture funds and retail aggregators also showed significant buying activity, at 61% and 72% respectively. These figures demonstrate a broad-based institutional interest in accumulating crypto assets during price dips.

The recent crypto market downturn occurred against the backdrop of a broader sell-off in global financial markets. Major stock indices, including the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, experienced their worst performance since September 2022. This market-wide volatility was primarily attributed to disappointing U.S. jobs data and reduced manufacturing activity, which intensified recession fears.

Despite these challenging market conditions, the crypto market has shown signs of recovery. Bitcoin, for instance, has rebounded by approximately 13% from its Monday lows, trading at around $56,400 as of the latest data from CoinGecko. This recovery, coupled with institutional buying activity, suggests a level of resilience in the crypto market.

Lawant pointed out that last week’s buy/sell ratios among institutional cohorts had dipped below 50%, indicating more sellers than buyers. However, this trend reversed sharply during the recent dip. “The numbers today are way above that,” Lawant stated, emphasizing that “Institutions buying the dip has been a clear trend during this correction.”

This institutional behavior aligns with the “buy the dip” strategy often observed in traditional financial markets. It reflects a belief that the current lower prices represent a buying opportunity, based on expectations of future price appreciation.

The strong institutional interest in cryptocurrencies, particularly during market downturns, could have significant implications for the broader adoption and stabilization of the crypto market. Institutional investors typically bring larger capital inflows and can potentially reduce market volatility over time through their long-term investment strategies.

The post Smart Money: Data Shows Institutions ‘Buying the Dip’ After Recent Price Crash appeared first on Blockonomi.

• Bitcoin is approaching a “death cross,” where the 50-day simple moving average (SMA) crosses below the 200-day SMA.
• The death cross is often seen as a bearish signal, but historically it has not always led to long-term price declines.
• Bitcoin recently dropped to around $49,577 before rebounding to about $56,386.
• Some analysts suggest the death cross could be a lagging indicator and may not accurately predict future price movements.
• Comments from Bank of Japan governor Shinichi Uchida about maintaining easy monetary policy have helped boost risk assets, including Bitcoin.

Bitcoin, the world’s leading cryptocurrency, is approaching a technical pattern known as a “death cross,” causing some concern among traders and investors.

This ominous-sounding term refers to when the 50-day simple moving average (SMA) crosses below the 200-day SMA, often interpreted as a bearish signal in technical analysis.

As of the latest data, Bitcoin’s price stands at approximately $56,386, with the 50-day SMA at $62,488 and the 200-day SMA at $61,664. The recent price action has seen Bitcoin drop to a low of $49,577 before rebounding, marking a significant 30% decline from its July 29 peak.

While the death cross traditionally signals potential bearish momentum, many seasoned crypto traders and analysts caution against overreaction

Historical data shows that death crosses don’t always lead to long-term price declines. In fact, the last Bitcoin death cross occurred in September 2023, after which the cryptocurrency’s value surged by 190% over the following six months.

Matt Hougan, CIO of Bitwise, commented on the current market sentiment: “If you are like most crypto investors, you’re cycling through a brutal swing of emotions, including fear and despair. For many, the emotion that strikes hardest is anger. I feel those emotions too. But I feel something else too—something born from six-plus years of managing money in crypto full-time: Opportunity. Because I’ve seen this movie before.”

1/ History suggests that this weekend's sell-off is a buying opportunity.

A thread on why.

[Note: Not investment advice. Just my opinion.]

— Matt Hougan (@Matt_Hougan) August 5, 2024

The significance of a death cross can vary depending on which moving averages are used. For instance, exponential moving averages (EMAs), which give more weight to recent price action, present a different picture, suggesting the current situation might be a reaction to a dip rather than a long-term bearish trend.

Adding to the complexity of the market analysis, recent comments from Bank of Japan (BOJ) governor Shinichi Uchida have introduced a new factor. Uchida stated that the central bank wouldn’t hike borrowing costs when markets are unstable, potentially weakening the case for continued unwinding of “yen carry trades” and resulting risk aversion in assets like Bitcoin.

“As we’re seeing sharp volatility in domestic and overseas financial markets, it’s necessary to maintain current levels of monetary easing for the time being,”
Uchida said in a speech to business leaders.

This statement has led to a weakening of the Japanese yen and a boost in risk assets, including Bitcoin and stock futures. The cryptocurrency briefly topped $57,300 following Uchida’s comments, while Japan’s Nikkei index rose 4%, signaling a potential risk reset.

Market observers note that the death cross could end up being a lagging indicator, as it’s based on past data. In some cases, it can even be a false signal if there’s no decisive bearish reversal. For example, Bitcoin recorded a death cross in March 2020, only to hit a new all-time high later that year.

The post Bitcoin (BTC) Price Volatility Increases as Death Cross Looms appeared first on Blockonomi.

• Core Scientific announced an expanded deal with CoreWeave worth $6.7 billion over 12 years.
• The company will provide an additional 112 megawatts of computing infrastructure to CoreWeave.
• Core Scientific’s shares rose by 18% following the announcement.
• The deal represents a shift from bitcoin mining to AI infrastructure for Core Scientific.
• CoreWeave will finance the modifications to Core Scientific’s infrastructure.

Core Scientific, a major player in the bitcoin mining industry, has announced a significant expansion of its partnership with CoreWeave, an AI-focused cloud provider.

The deal, valued at $6.7 billion over 12 years, marks a pivotal shift in Core Scientific’s business strategy from cryptocurrency mining to artificial intelligence infrastructure.

Under the new agreement, Core Scientific will expand its high-performance computing (HPC) infrastructure by 112 megawatts (MW) to a total of 382 MW. This additional capacity will be used to host CoreWeave’s NVIDIA graphics processing units (GPUs), which are crucial for AI and machine learning applications.

The expanded deal is expected to generate an additional $2 billion in revenue over 12 years, on top of the $4.7 billion anticipated from existing agreements. This brings the total potential revenue from the CoreWeave partnership to $6.7 billion, starting in the first half of 2026.

Core Scientific’s CEO, Adam Sullivan, stated,

“We have now contracted with CoreWeave for a total of 382 megawatts of HPC infrastructure, reflecting the strong demand for high-power data center infrastructure and the unique ability of our team to deliver it.”

The announcement had an immediate impact on Core Scientific’s stock price, which surged by approximately 18% following the news. As of the latest report, the company’s shares were trading at $9.74.

CoreWeave will finance all capital investments required to transform Core Scientific’s existing infrastructure into state-of-the-art, application-specific data centers tailored for dense HPC. The modifications are scheduled to begin in the latter half of 2024, with operations expected to commence in early 2026.

This expansion comes at a time when many bitcoin mining firms are retrofitting their existing facilities to serve AI clients. The shift is driven by decreased profitability in crypto mining, particularly following the recent bitcoin halving event.

Core Scientific’s move reflects a broader trend in the industry, as companies leverage their existing infrastructure and power contracts to meet the growing demand for AI computing resources.

The transition from bitcoin mining to AI infrastructure is not without challenges. As Needham analysts pointed out in a May report, much of the existing mining infrastructure would need significant modifications to accommodate HPC requirements.

Despite these challenges, Core Scientific’s Sullivan remains optimistic about the company’s future. He highlighted the planned integration of Block’s new 3-nanometer ASIC chip for next year and the thriving HPC business as key factors in the company’s growth strategy.

This deal represents a turnaround for Core Scientific. In January 2024, the company was emerging from bankruptcy and facing challenges from angry lenders. Since its return to the stock market that month, Core Scientific’s share price has risen by 140%, largely driven by its aggressive push into the AI business.

The company also continues its bitcoin mining operations. In July, Core Scientific mined 411 BTC from its fleet of owned miners, operating around 172,000 BTC miners with a total hash rate of 20.1 EH/s.

The post Bitcoin Miner Core Scientific Expands AI Infrastructure Deal with CoreWeave appeared first on Blockonomi.

• Japanese firm Metaplanet plans to raise about $70 million through stock rights issuance.
• The company intends to use $58.76 million of the raised funds to invest in Bitcoin.
• Metaplanet currently holds around 246 Bitcoins worth approximately $13.4 million.
• The company is following a strategy similar to MicroStrategy, which has accumulated over 220,000 Bitcoins.
• Metaplanet views Bitcoin as a long-term investment and a hedge against currency depreciation.

Metaplanet Inc, a Japanese investment and consulting firm, has announced plans to raise approximately 10 billion Japanese yen (about $70 million) through a stock rights offering.

The company intends to use 8.5 billion yen ($58.76 million) of the raised funds to invest in Bitcoin, significantly expanding its cryptocurrency holdings.

The decision was made during a recent board of directors meeting, where Metaplanet approved a gratis allotment of its 11th series of stock acquisition rights to all common shareholders.

Under this plan, shareholders of record as of September 5 will receive one stock acquisition right per common share. These rights will allow shareholders to acquire Metaplanet common stock at an exercise price of 555 yen (about $4) during the period from September 6 to October 15.

Currently, Metaplanet holds about 246 Bitcoins, valued at approximately $13.4 million. The planned investment would substantially increase the company’s Bitcoin treasury. Metaplanet’s CEO, Simon Gerovich, explained that the firm sees Bitcoin as “the apex monetary asset” and believes it will make a great addition to the company’s treasury.

This move mirrors the strategy employed by MicroStrategy, a Nasdaq-listed business intelligence firm that has been accumulating Bitcoin since 2020. MicroStrategy has raised debt and sold shares to acquire over 220,000 Bitcoins, now worth billions of dollars.

Metaplanet’s decision to invest heavily in Bitcoin is based on two main factors. First, the company sees long-term appreciation potential in the asset. Second, Bitcoin is viewed as a hedge against currency depreciation, particularly important given the recent volatility in the Japanese stock market and the depreciation of the yen against the US dollar.

The Japanese stock market recently experienced its worst one-day drop since 1987 when the Bank of Japan raised rates on short-term government bonds from 0% to 0.25% on July 31. This event led to a significant sell-off in the cryptocurrency market, with Bitcoin and Ethereum seeing price drops of around 18% and 26%, respectively.

Despite these recent market fluctuations, Metaplanet remains confident in Bitcoin’s long-term potential. The company stated, “An increase in Bitcoin prices is expected to strengthen our balance sheet, enhance asset value, and positively contribute to our earnings.”

Metaplanet is also considering future business ventures within the Bitcoin ecosystem. The company suggested it could generate additional income from its Bitcoin holdings by selling covered calls on the digital assets. Additionally, Metaplanet is exploring the possibility of transforming its hotel business to cater to Bitcoin enthusiasts and businesses, offering unique services and new revenue sources.

This pivot towards Bitcoin comes as Metaplanet has strategically exited most of its hotel business, which had been suffering from declining revenue and recurring losses over five consecutive periods.

The post Japanese Firm Metaplanet Announces $58.76 Million Bitcoin Investment Plan appeared first on Blockonomi.

• Peter Schiff criticized Bitcoin ETFs, saying they defeat the purpose of owning Bitcoin directly.
• Schiff argued ETFs make Bitcoin centralized, easily seized, and unusable for payments or cross-border transfers.
• Some Bitcoin supporters agreed with Schiff’s points about the benefits of owning Bitcoin directly.
• Schiff warned that ETF buyers only care about price, not Bitcoin’s core principles.
• Bloomberg analyst Eric Balchunas compared Bitcoin ETFs to gold ETFs in response to Schiff’s criticism.

Peter Schiff, a well-known economist and Bitcoin critic, recently shared his thoughts on Bitcoin exchange-traded funds (ETFs). His comments have started a conversation about the pros and cons of owning Bitcoin through ETFs versus holding it directly.

On Tuesday, Schiff posted on social media platform X that owning Bitcoin in ETFs “defeats the entire purpose of owning it in the first place.” He listed several reasons for this view. According to Schiff, Bitcoin held in ETFs is “no longer decentralized” and “not peer-to-peer.” He also said it’s “easily seized by authorities” and “can’t be used as a currency for payments, or transferred across borders.”

Peter Schiff spitting facts!

— Crypto Rover (@rovercrc) August 6, 2024

Schiff summed up his argument with the popular crypto phrase, “It’s not your keys, not your coins.” This saying means that if you don’t control the private keys to your Bitcoin, you don’t truly own it.

Some Bitcoin supporters agreed with parts of Schiff’s statement. Aubrey Jesseau, CEO of Beaver Bitcoin, told Decrypt, “If what Schiff says is true, Bitcoin might just be the best form of money the world has ever seen.” Jesseau’s company helps customers buy Bitcoin and store it in their own wallets, rather than leaving it on an exchange.

Jesseau added, “Buy Bitcoin and hold it in a wallet you control. No exchange, no leverage, no yield scheme. Just the best-performing asset of all time in a digital vault only you can open.”

Other Bitcoin fans also chimed in. Peter McCormack, host of the What Bitcoin Did podcast, jokingly tweeted that Schiff was “learning” about Bitcoin’s benefits.

Eric Balchunas, a Bloomberg analyst who has reported on Bitcoin ETFs, agreed that Schiff made a “fair point.” However, Balchunas questioned how Bitcoin ETFs are different from gold ETFs or gold mutual funds. He asked if the motto for gold should be, “Not sitting in your own safe, not your gold.”

Schiff, who is known for favoring gold over Bitcoin, later explained his views further. He said that buyers of Bitcoin ETFs “only care about price” and aim to “cash out with profits.” Schiff warned that this behavior shows “the pyramid scheme will soon collapse.”

Schiff has continued to voice concerns about Bitcoin’s future. On Sunday, he warned about potential “mass ETF liquidations” and a “Crypto Black Monday.” He predicted that Bitcoin falling below $38,000 could trigger large sell-offs, with the “actual short-term bottom” possibly dropping below $20,000.

It’s worth noting that while Schiff argues Bitcoin in ETFs can be easily seized, authorities have also seized Bitcoin held outside of ETFs. In late 2022, around 50,000 Bitcoin linked to the Silk Road online marketplace were taken by government authorities.

The post Not Your Keys, Not Your Coins: Did Gold Bug Schiff Accidentally Make Case for Bitcoin? appeared first on Blockonomi.

• Former President Donald Trump reiterated his support for Bitcoin and cryptocurrency during a livestream interview with Adin Ross
• Trump urged the US government not to sell its crypto holdings, but instead focus on developing the industry
• He compared crypto to artificial intelligence, stating that the US needs to innovate or risk falling behind countries like China
• Trump suggested the possibility of using Bitcoin to pay down the US national debt of $35 trillion

In a recent livestream interview with popular streamer Adin Ross, former President Donald Trump reaffirmed his support for Bitcoin and cryptocurrency, urging the United States to take a leading role in digital asset innovation. Trump’s comments come at a time of increased speculation about the US government’s intentions regarding its cryptocurrency holdings.

During the interview, Trump emphasized the importance of the United States maintaining its competitive edge in emerging technologies.

He drew parallels between cryptocurrency and artificial intelligence, stating,

“It’s like AI — ‘do you love it or do you not like it?’ — if we don’t do it, China is going to do it, or other people are going to do it, and we can’t be left behind, and crypto is right in that sphere.”

The former president expressed concern about recent reports of large Bitcoin transfers from wallets identified as belonging to the US government. Last week, a transaction of approximately $2 billion worth of Bitcoin to an unidentified wallet sparked speculation about potential government plans to sell its crypto holdings.

Trump argued against such a move, saying,

“It’s something they shouldn’t be doing because they should be trying to build it. If we don’t do it, China’s doing it, and other places are doing it, and they’re doing it anyway.”

Trump described cryptocurrency as a “very modern currency” and praised the industry, noting, “I know a lot of very good people that are really into that world, and into that market, they’re smart, they’re good people, and they think it’s going to be very beneficial.”

In a separate interview on Fox News, Trump floated the idea of using Bitcoin to address the United States’ national debt, which currently stands at $35 trillion.

He suggested,

“Who knows, maybe we’ll pay off our $35 trillion dollar [national debt], hand them a little crypto check, right? We’ll hand them a little Bitcoin and wipe away our $35 trillion.”

While the practicality of such a proposal remains questionable, it underscores Trump’s openness to exploring innovative solutions using cryptocurrency.

The former president’s pro-crypto stance aligns with his campaign efforts to attract support from the cryptocurrency community. At the recent Bitcoin 2024 conference, where he raised $25 million, Trump discussed the possibility of incorporating crypto into government reserves.

He also vowed to dismiss SEC Chair Gary Gensler, who is viewed by many in the crypto industry as an adversary, on his first day back in office if elected.

Trump’s comments on cryptocurrency and innovation extend beyond digital assets to encompass broader technological and energy infrastructure concerns. Industry spokespersons and analysts agree with Trump’s assessment that the US must invest substantially in energy infrastructure to support future industries, including Bitcoin mining facilities and AI data centers, which they see as ways to fortify the energy grid.

As the 2024 presidential race heats up, cryptocurrency policy is emerging as a notable point of differentiation between candidates. While Trump has taken a pro-crypto stance, his potential Democratic opponent, Vice President Kamala Harris, has faced challenges in her relationship with the crypto industry. Although her campaign is reportedly working to mend these ties, Bernstein analysts suggest that her efforts to engage the industry may not significantly sway voters in the upcoming election.

The US government’s approach to cryptocurrency regulation and adoption remains a topic of debate.

As of now, the government reportedly holds 179,155 Bitcoin, worth approximately $10 billion. The recent transfer of a portion of these holdings has raised questions about the government’s long-term strategy regarding its crypto assets.

The post Trump Reaffirms Support for Crypto: Urges US to Lead in Digital Asset Innovation appeared first on Blockonomi.

• Bitcoin experienced a steep fall from $65,000 to $49,000 in early August 2024, triggered by various factors including Mt Gox sales and interest rate decisions
• The price has since rebounded above $55,000, showing signs of recovery
• Some analysts see similarities between this crash and the 2020 Covid crash, as well as patterns from the 2016 halving period
• The Crypto Fear and Greed Index entered “Extreme Fear” territory with a score of 17 out of 100
• U.S. Bitcoin ETFs saw outflows of $168.4 million amid negative market sentiment

Bitcoin, the world’s largest cryptocurrency, has shown signs of recovery after a dramatic price drop in early August 2024. The digital asset, which fell from $65,000 to a low of $49,000, has since rebounded to trade above $55,000, sparking discussions about market patterns and investor sentiment.

The recent price action has drawn comparisons to previous market events, including the March 2020 crash triggered by the COVID-19 pandemic and the period following the 2016 Bitcoin halving.

Veteran trader Peter Brandt noted similarities between the current situation and the post-2016 halving period, which preceded the historic bull run of 2017.

Please note that $BTC decline since halving is now similar to that of the 2015-2017 Halving Bull market cycle pic.twitter.com/cIm3WKzBog

— Peter Brandt (@PeterLBrandt) August 5, 2024

The steep decline was attributed to a combination of factors, including the sale of Bitcoin by Mt Gox creditors and the German government, as well as monetary policy decisions by major central banks.

The Federal Reserve’s indication that it would not cut rates in September and the Bank of Japan’s decision to raise interest rates by 15 basis points to 0.25% contributed to the market turbulence.

Despite the severity of the drop, the current situation differs from the 2020 COVID crash in several ways. Trading volumes during this decline, while significant, have not reached the levels seen during the pandemic-induced sell-off. On August 5, 2024, the BTC/USDT trading pair on Binance recorded a volume of 125.5k BTC, compared to 402.2k BTC during the height of the March 2020 crash.

The market’s recovery has been supported by increased institutional involvement and growing retail interest, factors that were less prominent during previous downturns. The approval of Bitcoin and Ethereum ETFs has provided additional avenues for investment and potentially greater market stability.

Technical analysis suggests that Bitcoin has formed a descending broadening wedge pattern on the daily chart, similar to the formation seen before the recovery in 2020. As of the latest data, $51,200 represents a critical support level that Bitcoin must maintain to preserve the integrity of this pattern.

While the price has rebounded, market sentiment remains cautious. The Crypto Fear and Greed Index, a popular measure of market sentiment, plunged to 17 out of 100, indicating “Extreme Fear” among investors. This marks the lowest level for the index since July 12, 2022, reflecting the uncertainty pervading the market.

The negative sentiment has been reflected in fund flows, with U.S. spot Bitcoin exchange-traded funds experiencing outflows of $168.4 million. This suggests that some investors are taking a risk-off approach in response to the recent volatility.

As Bitcoin attempts to regain lost ground, it faces several resistance levels. The area around $58,000 is seen as a key hurdle, with the $60,000 mark representing a significant psychological barrier. A breakthrough above these levels could potentially reignite bullish momentum.

On the support side, levels around $55,000, $53,500, and $52,000 are being closely watched by traders and analysts. A failure to hold these supports could lead to further downside, with some suggesting that a retest of the $50,000 level is possible.

The post Bitcoin Recovers to $55,000 Following Crash: What’s Next for BTC? appeared first on Blockonomi.

The prominent British fund, overseeing around $30 billion worth of assets under management (AUM), holds over 4 million shares in the Fidelity Wise Origin Bitcoin ETF (FBTC), worth around $211 million, and over 7,4 million shares in BlackRock’s iShares Bitcoin Trust (IBIT), valued at $253 million.

Markets are down, and they may collapse further. Sadly, this move all all about the macro environment. Bitcoin is driven by liquidity. Right now, global liquidity is collapsing.

More Money Flowing Into BTC

Capula Management has joined other hedge fund giants previously disclosing holdings in IBIT, including Millennium Management. In May, the US fund manager reported owning nearly $2 billion in Bitcoin ETFs, including positions in IBIT and other funds.

IBIT has seen tremendous demand since its debut in January. As of May 2024, over 414 financial institutions, big and small, reported holdings in the ETF. According to Bloomberg Intelligence analyst Eric Balchunas, the number of IBIT holders is “mind-boggling” for a new ETF.

As of August 2, IBIT has $21.5 billion in AUM, outperforming Grayscale’s Bitcoin ETF (GBTC), which has seen constant capital outflows since it was converted from a trust. GBTC has around $12.7 billion in AUM as of August 5.

FBTC has also attracted considerable investment, with over $10 billion in assets as of June 2024. Like IBIT, the fund also features a competitive fee structure, with a 0.25% management fee, waived until August 2024.

The growing adoption of Bitcoin ETFs shows the increasing institutional interest in gaining exposure to the cryptocurrency market through regulated investment vehicles. BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s Wise Origin Bitcoin Fund (FBTC) are currently leading choices among investors in the Bitcoin ETF market.

A recent report revealed that Morgan Stanley will be the first Wall Street firm to allow their financial advisors to recommend IBIT and FBTC to select wealth clients. The policy change will affect approximately 15,000 advisors within the firm and will take effect starting on Wednesday.

Bitcoin ETFs Trade Over $5 billion Amid Market Collapse

US spot Bitcoin ETFs recorded over $5 billion in trading volume in Monday’s US trading session, the highest level since mid-April.

BlackRock’s IBIT led with nearly $3 billion in trading volume and a $172 million increase in assets under management. Fidelity’s FBTC followed with over $858 million in trading volume.

Despite outflows of $148 million, GBTC still managed a trading volume of over $693 million.

Bloomberg’s Balchunas noted earlier today that the trading volume surpassed $2.5 billion around 10:45 AM, which was substantial for that early in the day. He noted that for Bitcoin bulls, high trading volume on a day when the overall market is down is a negative sign.

It often indicates fear among investors, which can lead to further price declines.

Conversely, high trading volume on a bearish day is beneficial for the ETF itself. It demonstrates strong liquidity, a key factor that attracts traders and institutional investors.

“On flip, deep liquidity on bad days is part of what traders and institutions love about ETFs, so you also want to see volume too, good for the long term,” Balchunase stated.

The surge in trading volume comes amid ongoing market turbulence likely due to bleak macro outlook and increasing selling pressure from Jump Trading. The cryptocurrency market cap is down 7% over the past 24 hours.

The price of Bitcoin (BTC) dipped below $50,000 early Monday, the lowest level since late February, according to CoinGecko. At press time, BTC has recovered above $54,000, down nearly $20,000 in 8 days.

Ethereum (ETH), the second-largest cryptocurrency, experienced sharp decline during the day. ETH is currently trading at around $2,500 up a little from Monday’s lows.

The post Capula Puts Almost $500M In BlackRock, Fidelity Bitcoin ETFs appeared first on Blockonomi.

According to data from Farside Investors, investors poured around $191 million into the Grayscale Bitcoin Mini Trust (BTC) on July 1, bringing the fund’s total net inflows to $209 within two trading days.

The Bitcoin Mini Trust started trading early Wednesday morning after getting approval from the U.S. Securities and Exchange Commission (SEC) last week. The trading came right after its registration statement was activated.

More BTC Investment Options

The ETF ended its debut day on a low-key note, capturing $18 million in net inflows, data shows. However, that was still a good start, as several of BTC’s competitors reported losses over the same period.

Similarly, while Grayscale’s BTC saw record inflows on Thursday, most competing funds bled.

Investors reportedly withdrew $48.4 million from Fidelity’s Bitcoin ETF (FBTC), $22.4 million from ARK Invest’s Bitcoin fund (ARKB), $20.7 million from Bitwise’s Bitcoin fund (BITB), and $3.6 million from VanEck’s fund (HODL).

Grayscale’s Bitcoin ETF (GBTC), the second-largest Bitcoin ETF in assets under management (AUM), extended its outflow streak on Thursday. The fund reported $71.3 million drained.

Since GBTC was converted from a trust into an ETF, it has seen over $19 billion in outflows. However, compared to the initial weeks, GBTC’s outflows appear to have stabilized. As of August 1, the fund has $15,2 billion worth of Bitcoin in AUM.

Elsewhere, the Grayscale Ethereum ETF (ETHE) outflows continued on Thursday as investors pulled $78 million out of the fund, Farside’s data reveals. The fund, offering a costly 2.5% fee, has seen approximately $2 billion in outflows since it was converted into an ETF.

The spinoff of ETHE, the Grayscale Ethereum Mini Trust (ETH) , reported zero flows on Thursday. Despite that, ETH has attracted over $200 million since its debut.

Grayscale’s Strategy is Paying Off

Both the Grayscale Ethereum Mini Trust and the newly launched Grayscale Bitcoin Mini Trust feature lower expense ratios compared to Grayscale’s existing products. These funds has an expense ratio of just 0.15%, making them the cheapest exchange-traded product (ETP) in the U.S. market.

With these offerings, Grayscale aims to attract investors who are increasingly sensitive to fees, especially in a crowded market where competitors are also offering low-cost options.

“I think demand for very low-cost bitcoin exposure will find a lot of investor interest,” said Zach Pandl, Head of Research at Grayscale, in a recent interview with The Block. He added that the company was committed to client-focused product development.

“The timing of this product launch is excellent,” noted Pandl, adding the increasing mainstream attention on crypto, influenced by factors such as imminent Federal Reserve interest rate cuts and presidential election politics. These macro trends are what investors consider when owning Bitcoin, according to Pandl.

Existing investors in Grayscale’s larger funds will automatically receive shares in the new Mini Trusts. The transition not only retains current investors but also encourages them to explore the new lower-cost options. The strategy could also enhance customer loyalty and engagement.

So far, Grayscale’s strategy seems to work out and it could continue to pay off in the long run. Still, it remains unclear how the dynamics will play out in the future, especially with increasing competition from BlackRock and Fidelity.

BlackRock has moved from a previous newcomer to a dominant force in the Bitcoin ETF market after outperforming Grayscale in spot Bitcoin ETF’s AUM. As of July 1, BlackRock’s iShares Bitcoin Trust (IBIT) holds $22.5 billion worth of Bitcoin.

IBIT is one of the most successful fund in the ETF history, reaching over $10 billion in AUM within just seven weeks and being one of only 150 ETFs globally to surpass that milestone.

The post Grayscale Bitcoin Mini Trust Tops $209M After Two Trading Days appeared first on Blockonomi.

• Marathon Digital reported Q2 revenue of $145.1 million, missing analyst estimates of $157.9 million
• The company posted a net loss of $199 million, or $0.72 per share, compared to a $9 million loss in Q2 2023
• Marathon’s Bitcoin production decreased 30% year-over-year to 2,058 BTC in Q2
• The company’s energized hash rate increased 78% to 31.5 EH/s in the second quarter
• Marathon Digital held over 20,000 Bitcoin on its balance sheet after purchasing an additional $100 million worth

Marathon Digital Holdings, a leading Bitcoin mining company, released its second-quarter earnings report for 2024 on August 1, revealing significant challenges in the post-halving era of cryptocurrency mining.

The company reported revenue of $145.1 million for Q2, falling short of Wall Street expectations of $157.9 million. Despite missing estimates, this figure represents a 78% increase from the $81.7 million reported in Q2 2023. The revenue growth was primarily attributed to a higher average price of Bitcoin mined and revenues from newly acquired hosting services.

However, Marathon Digital faced a substantial net loss of $199 million, or $0.72 per diluted share, a stark contrast to the $9 million loss reported in the same quarter last year. This loss was largely driven by a $148 million fair market value drop in digital assets. Analysts had forecasted an earnings-per-share of -$0.19, but the actual figure missed by $0.53.

The company’s Bitcoin production saw a significant decline, with 2,058 BTC mined during the quarter, down 30% from the 2,926 BTC produced in Q2 2023. On average, Marathon mined 22.9 Bitcoin per day, which is 9.3 less than the previous period. The decrease in production was attributed to several factors, including unexpected equipment failures, increased global hash rates, and the impact of the Bitcoin halving event in April.

Fred Thiel, Marathon’s CEO, acknowledged these challenges in a statement, citing unexpected equipment failures and maintenance issues at their Ellendale site, as well as intensified competition in the mining sector.

“Our BTC production was impacted by unexpected equipment failures and transmission line maintenance at the Ellendale site operated by Applied Digital, increased global hash rate, and the April halving event,” Thiel explained.

Despite these setbacks, Marathon Digital reported some positive developments. The company’s energized hash rate increased 78% year-over-year to 31.5 EH/s in the second quarter, reaching an all-time high. Thiel stated that the company continues to target 50 exahash of energized hash rate by the end of 2024, with additional growth planned for 2025.

Marathon Digital’s financial position remained strong, with $1.4 billion in unrestricted cash, cash equivalents, and Bitcoin as of June 30. The company held 18,488 Bitcoin on its balance sheet at the quarter’s end and subsequently purchased an additional $100 million worth of Bitcoin, bringing total holdings to more than 20,000 Bitcoin.

The challenging quarter led Marathon to sell 51% of its mined Bitcoin to cover operating expenses. The company noted that the average price of BTC mined in Q2 2024 was 136% higher than in the prior year period, helping to offset some of the production declines.

Following the earnings report, Marathon Digital’s stock price fell 7.78%, ending the trading day at $18.14. This decline occurred amid a broader market slide driven by overheated tech stocks.

Marathon Digital’s Q2 results reflect the broader challenges facing the Bitcoin mining industry following the halving event. Other miners, such as Riot Platforms, have reported similar difficulties, with Riot posting an $84.4 million net loss for the same quarter.

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