Market Insights: DEC 2024 | Week4
Wavebridge Research/
Bitcoin Network Achievements and Market Dynamics
Bitcoin ETFs launched in the US earlier this year hold 1.4 million BTC, while US-listed companies have purchased and held around 297,000 BTC. Institutional investors bought 859,454 BTC in 2024 alone. That's eight years of Bitcoin issuance and 4.3 per cent of the total circulating supply. Since its launch, BlackRock's Bitcoin ETF holds around 540,000 bitcoins and is valued at $57.2 billion. This is 70% larger than the $33.6 billion of BlackRock's Gold Trust ETF, the largest gold ETF, and represents 2.55% of all bitcoin. The ‘bitcoin-to-gold ratio’ - the amount of gold that can be bought with one bitcoin - reached 37.3. This means that one Bitcoin can buy about 37 ounces of gold, surpassing the previous high of 36.7 in November 2021. Franklin Templeton has filed with the US Securities and Exchange Commission for approval of a cryptocurrency index ETF that includes Bitcoin and Ethereum. Michael Saylor argued that a digital asset policy centred on bitcoin could boost US economic growth. He argued that digital assets should be categorised into five categories: ‘digital commodities’, ‘digital securities’, ‘digital tokens’, ‘digital NFTs’, and ‘digital ABTs’.
Ethereum Network Growth and Key Developments in the Crypto Ecosystem
In December, inflows into Ethereum spot ETFs accelerated. A total of $1.66 billion was pumped into ETH ETFs in December, representing 74% of the total inflows since the inception of ETH ETFs. BlackRock ETHA led the growth. Ripple officially launched its stablecoin RLUSD on global exchanges. Ripple claims that RLUSD will provide a number of benefits to users and developers within the XRP leisure ecosystem and will contribute to the growth of the RWA tokenisation market. Tether is expected to surpass $10bn in net income this year. Tether's market capitalisation has grown by nearly $50 billion this year, reaching $140 billion. Tether's CEO said, ‘We will invest at least half of our net income next year in investments, including AI.’ Fintech giant Revolut announced the addition of Binance Coin (BNB) to its cryptocurrency portfolio. Bitget Token (BGB) surged after receiving a licence to provide Bitcoin services from the Central Bank of El Salvador. The combined market capitalisation of AI agent coins surpassed $10 billion.
Regulatory Priorities and Investment Trends in the Cryptocurrency Market
World Liberty Financial, a decentralised finance platform backed by US President-elect Trump, announced a long-term collaboration with Ethereum. ‘The Trump administration has demonstrated not only a favourable perception of cryptocurrencies, but also an eagerness to promote the asset class,’ JPMorgan said. However, JPMorgan warned that the market may not see any policy impact for the first 9-12 months of Trump's term. US Senator Loomis says 2025 will be a pivotal year for Bitcoin and digital assets. The US Senate Banking Committee cancelled a vote on the reappointment of SEC Commissioner Caroline Crenshaw. MARA Holdings bought 15,000 bitcoins for $1.53 billion. The company now holds approximately 44,394 bitcoins. Hut 8, one of the largest mining companies in the US, spent $100 million to buy over 10,000 bitcoins. The Riot platform bought 667 bitcoins. This brings Riot's total holdings to 17,429. MetaMask launched the MetaMask Card in the US, enabling digital asset payments. Circle's CEO called for stablecoins to become a large US export product.
Global Adoption and Strategic Moves in Bitcoin and Cryptocurrency Policy
Satoshi Hamada, a member of Japan's House of Councilors, proposed the introduction of a national Bitcoin reserve. The President of Argentina announced a reform policy to adopt Bitcoin as an official currency by 2025. An Australian pension fund invested around $27 million in Bitcoin. Ukraine announced that it will legalise cryptocurrencies by the first quarter of 2025, but will not provide tax breaks for cryptocurrency transactions. The Vancouver, Canada city council approved a resolution to look into integrating bitcoin into the city's financial operations. A member of the Hong Kong Legislative Council introduced a proposal for the city's endowment fund to invest in cryptocurrencies. Japanese cryptocurrency exchange Coincheck was listed on the Nasdaq market. A member of the Russian parliament proposed a national bitcoin reserve, which would allow Russia to use bitcoin as a strategic reserve asset in addition to its existing foreign exchange reserves. Argentina opened its stock market to cryptocurrency exchange-traded funds. The Bhutanese government recently sold a series of bitcoins, with the government holding 11,791 bitcoins.The French Financial Supervisory Authority approved the crypto business application of French bank BPCE. El Salvador announced that it will continue to buy bitcoin despite warnings from the IMF to reduce its allocation to bitcoin. El Salvador secured a $1.4 billion bailout from the IMF on the condition that it reduce its bitcoin-related policies, but the day after the announcement, the government reaffirmed that it will continue to buy bitcoin. The Hong Kong Securities and Futures Commission granted licences to four new cryptocurrency exchanges, HKbitEX, Accumulus, DFX Labs, and EX.IO. This brings the total number of licensed exchanges within the Hong Kong regulatory framework to seven. Tether has invested a significant stake in StablR, a small Malta-based stablecoin issuer, in response to the European Union's cryptocurrency regulation MiCA. Tether ceased issuing its own euro-pegged stablecoins and shifted to a strategy of partnering with compliant companies. Singapore expanded its policies to build a cryptocurrency ecosystem, including tax incentives. Thirty payment companies, including U.S. firms Coinbase, Ripple, and Hong Kong-based Futu, have been authorised by the central bank to offer digital token services. Metaplanet issued a ¥4.5 billion fourth bond to finance its Bitcoin acquisition. The company's strategy of buying Bitcoin through low-interest borrowing makes it the only major Asian company to hold close to $100 million in digital assets. Global fintech firm Wavebridge completed the filing of its virtual asset service provider (VASP) registration in South Korea.