The Crypto Compass Issue #75

Hello readers,

This week, the crypto market is witnessing significant movements, highlighted by substantial net outflows from U.S. spot bitcoin exchange-traded funds (ETFs), which signal investor uncertainty amid recent economic data and Federal Reserve announcements. Meanwhile, a notable development comes from China, where telecom provider Coolpad Group's substantial investment in Bitcoin mining equipment underscores a potential shift towards greater engagement with the crypto industry. These developments underscore the dynamic and ever-evolving nature of the crypto market, with global investments and market sentiments playing crucial roles in shaping its future.

U.S. Bitcoin ETFs See Significant Net Outflows Amid Market Uncertainty

U.S. spot bitcoin exchange-traded funds (ETFs) experienced net outflows of $145.83 million on Monday, following a weekly outflow of $580 million. Fidelity’s FBTC led the outflows with $92 million, contributing to its $140 million outflow last week. Other ETFs, including those from Ark Invest, 21Shares, Grayscale, and VanEck, also saw negative flows. Bitwise’s BITB was the only fund with minimal net inflows of $3 million. This trend reverses the longest streak of net inflows for U.S. spot bitcoin ETFs, driven by investor uncertainty following conflicting economic data and a "hawkish" Federal Open Market Committee meeting. Bitcoin's price has also dropped, reflecting broader market apprehensions.

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Chinese Telecom Provider Coolpad Ventures into Bitcoin Mining

Chinese telecom provider Coolpad Group is investing $13.5 million in Bitcoin mining, purchasing 2,700 mining rigs to boost its computing power in North America. This move significantly increases Coolpad's mining capacity from 873,000 TH/s to about 1,504,800 TH/s. The company, traditionally known for producing mobile phones and accessories, has been exploring opportunities in the Web 3.0 digital currency business since late 2023. This diversification into the crypto space follows Coolpad's recent $28 million investment in shares of Nasdaq-listed crypto asset companies, marking a strategic shift to tap into new revenue streams amidst the growing mainstream acceptance of digital assets.

ZKsync Token Launches with Community Concerns

The ZKsync token, now trading at around $0.22, launched on Monday with a market capitalization exceeding $935 million and a fully diluted value of approximately $5.3 billion. With a maximum supply of 21 billion tokens and over 3.6 billion currently circulating, ZKsync has seen a trading volume of nearly $99 million since its debut. Major exchanges like Binance have listed ZKsync with various trading pairs, and Binance plans a token distribution program from June 17 to July 16, 2024. However, the community has expressed concerns about the token distribution methodology, and there has been a significant rise in scams targeting ZKsync users. The ZKsync Era, a Layer 2 network, aims to enhance Ethereum's scalability through zero-knowledge proof technology.

Happenings of the week

• Coinbase starts offering pre-launch markets trading

• Bitcoin Layer-2 Network Stacks Halted for 9 Hours—What Happened?

• Tether announces launch of gold-backed cryptocurrency

• Bitcoin Price Will Hit $200,000 in 2025

SEC Rejects Ripple's Argument for Lower Fines

The U.S. Securities and Exchange Commission (SEC) has countered Ripple's request for reduced fines in its ongoing legal battle, emphasizing key differences between Ripple’s case and the Terraform settlement. Ripple, which has been in litigation with the SEC since 2020, cited Terraform’s $4.47 billion settlement as a benchmark for its penalties.

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