The Crypto Compass Issue #54

Hello readers,

In this week’s crypto news, major developments have emerged. The SEC approved 11 Bitcoin spot ETFs, reflecting growing acceptance of cryptocurrencies. BlackRock CEO Larry Fink recognized Bitcoin's value, akin to gold, amidst economic uncertainties. Tether's USDT now dominates over 70% of the global stablecoin market. Additionally, the NFT world saw a leap with Pudgy Penguins setting a record high floor price, highlighting the growing influence of digital collectibles. These events collectively mark a significant shift in the landscape of traditional and digital asset markets.

SEC Greenlights 11 Bitcoin ETFs: A Milestone in Crypto Market Regulation

The Securities and Exchange Commission (SEC) has expedited the approval of 11 spot bitcoin ETFs, including those from major players like Bitwise, Grayscale, and BlackRock. This significant regulatory move, aligning with the Exchange Act and regulations, opens a new chapter in cryptocurrency investment. The approval, highlighted in an official SEC document, comes after a court case influenced Grayscale's ETF bid. Grayscale is set to uplist GBTC to NYSE Arca, reflecting readiness for broader market access. Despite this, SEC Chair Gary Gensler cautions investors about the risks associated with bitcoin and related products.

Anticipating substantial market impact, these ETFs are expected to attract significant initial inflows. Valkyrie and VanEck predict hundreds of millions to billions in early investments, while Bitwise sees a potential $72 billion market within five years. This development followed Cboe BZX's request for expedited ETF registration, underscoring the growing interest and readiness for bitcoin ETFs in the financial markets.

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BlackRock CEO Larry Fink Endorses Bitcoin as a Protective Asset

BlackRock CEO Larry Fink, in a CNBC interview, has positively acknowledged Bitcoin, comparing its protective qualities to those of gold. He highlighted its significance as a safeguard in times of geopolitical and economic uncertainties. This perspective from the leader of the world's largest asset management firm marks a pivotal moment for Bitcoin's integration into mainstream finance. Fink's comments, aligning with BlackRock's recent approval for a spot Bitcoin ETF by the SEC, add to the growing acceptance of Bitcoin as a key investment asset. Such endorsements are shaping Bitcoin's narrative, influencing market sentiment, and potentially accelerating its adoption.

Tether's USDT Dominates Stablecoin Market, Surpassing Major Economies

Tether's USDT tokens have surged to represent over 70% of the global stablecoin circulation, significantly outpacing competitors in 2023. The company, already the most valuable in the crypto space, increased its market share from 50% to 71% within the year, according to The Block data. Remarkably, Tether has crossed 95 billion tokens in circulation, exceeding the GDPs of nations like Guatemala and Bulgaria. In contrast, its closest competitor, Circle's USD Coin (USDC), holds just 27 billion tokens, down from over 48 billion at the year's start.

This growth comes amidst leadership changes at Tether, with CTO Paolo Ardoino replacing the more secretive Jean-Louis van der Velde as CEO. Ardoino's tenure is marked by increased engagement with law enforcement and regulators, including freezing USDT in wallets sanctioned by the U.S. Office of Foreign Asset Controls (OFAC) and integrating law enforcement agencies onto the Tether platform.

Happenings of the week

• Hong Kong’s HashKey secures $100 million in Series A round at $1.2 billion valuation

• Bitcoin, RWAs and institutional adoption among key themes for 2024: Binance Research

• Crypto investment products saw record $17.5 billion trading volume last week: CoinShares

• JPMorgan doesn't see more than 50% chance of spot Ethereum ETF approval by May

Pudgy Penguins Soar to New Heights

Pudgy Penguins recently set a record with a peak floor price of 14 ETH ($35,500). They're outperforming other established NFTs, challenging the usual trends. Their new floor price is half of BAYC's and a quarter of CryptoPunks'. It's intriguing to see how they'll fare in the recovering NFT market and whether holders will shift investments to assets like Punks, Ethereum, or Bitcoin.

Stay tuned for more updates next week! If you haven't yet, hit that subscribe button to ensure you never miss an issue. Found value in this edition? Please consider sharing it with your friends, colleagues, and fellow crypto enthusiasts. Together, let's navigate the world of crypto with clarity and insight!