Bitcoin Dominance Declining
Bitcoin continues to range in the $90k zone, setting its sights on a critical breakout to $100k. After bouncing strongly from the $91k resistance level last week, it rallied back to $98k before experiencing a 5% sell-off at the start of December, a development we had anticipated and outlined on our Exclusive Patreon channel. This marks the fourth consecutive month since August where Bitcoin has sold off at the beginning of a new month, only to rally higher afterward.
Bitcoin Dominance
Bitcoin dominance has also dropped significantly, falling from a late-November high of 61% to 55% today. This shift could signal a cycle top for Bitcoin dominance and open the door for altcoins to take the spotlight. November also saw a record $7.6 billion in inflows into BTC and ETH ETFs, highlighting the growing appetite for crypto investments from institutions.
Weekly Price Update
Crypto Exchange Volumes Hit 3 Year High
Monthly crypto exchange volumes surged to a three-year high of $2.9 trillion in November, driven by Donald Trump’s election victory and optimism for favourable crypto regulations. Crypto.com had its strongest month of the year. Sentiment was further bolstered by the election of hundreds of pro-crypto candidates to Congress, signalling a potential shift towards a more favourable regulatory environment. Globally, greater regulatory clarity has accelerated crypto adoption, pushing trading volumes to new heights.
Kraken saw a notable surge in perpetual trading, particularly in Bitcoin, Solana, and Dogecoin, with DOGE’s 24-hour volume surpassing Ether for the first time. Meanwhile, the approval and rapid growth of Bitcoin ETFs in major markets attracted institutional investors, significantly contributing to the market’s strong rally.
US Government Moves $2B of Bitcoin
The U.S. government recently transferred nearly $2 billion worth of Bitcoin, seized from the Silk Road, to Coinbase. This significant move triggered speculation and a market dip, with Bitcoin's price dropping over 1% to $95,800. Former President Trump, known for his support of the crypto ecosystem, has floated the idea of establishing a strategic Bitcoin reserve for the U.S. This proposal could legitimise Bitcoin as a global asset and potentially offset a portion of the national debt if its value continues to rise.
In contrast, the Biden administration appears to have a different approach. Some are speculating that the administration may sell additional Bitcoin before President-elect Trump’s inauguration on January 20, possibly to preempt Trump's Bitcoin reserve plan. This political tension has created slight market uncertainty, resulting in price volatility and some erosion of investor confidence.
Despite this, a significant market crash is unlikely. Institutional players like MicroStrategy continue to show strong interest in Bitcoin, providing a stabilising force. Furthermore, Trump’s return to office may lead to a strategic buyback of any sold Bitcoin, reinforcing his vision while challenging the current administration’s actions.
ETH SUCCESS
Ethereum ETF Staking Yield Likely To Be Approved
The SEC has approved multiple Ethereum (ETH) ETFs, though they currently lack staking features due to regulatory concerns. ETH has lagged behind Bitcoin (BTC) in performance this year, but recent increases in inflows to ETH ETFs suggest that this trend might be ending. Under a more crypto-friendly administration (Trump 2.0), staking yields within ETFs could be approved, enhancing returns and decentralisation by encouraging broader participation.
Staking-enabled ETFs could lower management fees (currently up to 2.5% for funds like Grayscale’s ETHE) to nearly zero. By staking 25% of assets, issuers could generate 3.2% annual rewards, covering costs and making ETFs more affordable. Ethereum stakers earn about 3% annually, with 28% of ETH locked in staking or lending contracts. Additionally, nearly 60% of ETH hasn’t been traded in the past year, showing strong investor confidence and creating favourable demand-supply conditions for the cryptocurrency.
Spot ETH ETFs Highest Daily Inflow
On November 29, spot ETH ETFs in the U.S. hit a new daily inflow record of $332.9 million, surpassing the previous record of $295.5 million set on November 11. For the first time, ETH ETFs saw higher inflows than spot Bitcoin ETFs on a day when both had inflows. BlackRock’s iShares Ethereum Trust led the charge, pulling in $250.4 million and surpassing $2 billion in total inflows since its launch in July. For the first time, ETHr ETF inflows outpaced Bitcoin’s, signaling growing interest in altcoins from Wall Street, even as Bitcoin ETFs see outflows. This indicates that the rotation toward altcoins is underway and as the market believes that altcoin season is here.
Ethereum's Monthly Onchain Volume Hits $183.7 billion
Ethereum's onchain volume hit $183.74 billion in November, the highest since December 2021's $241 billion, reflecting a 9% increase from March's peak and nearly doubling January's low of $107.93 billion. This growth is driven by capital moving from centralised exchanges to onchain activities, including a resurgence in the DeFi and NFT market.
Ethereum-based NFT marketplaces recorded their highest monthly volume since June, with weekly trade volumes averaging $55 million. Floor prices for major NFT projects surged, with CryptoPunks up 55%, Pudgy Penguins rising 46.5%, and Milady Maker climbing 36.7%.
Micheal Saylor Pitched Microsoft
“Microsoft can’t afford to miss the next technology wave, and Bitcoin is that wave”. Saylor, pitched a strategy to Microsoft’s board this week, claiming the tech giant could add up to $584 to its share price over the next decade by buying Bitcoin (Currently at $431). His pitch suggested Microsoft use its entire treasury, debt, cashflows, dividend payouts, and share buyback funds to accumulate Bitcoin, assuming the cryptocurrency reaches a price of $1.7 million per BTC by 2034. According to Saylor, this approach could potentially add $4.9 trillion to Microsoft's valuation. Currently, Microsoft is the world’s third most valuable company, with a market cap of $3.18 trillion, trailing behind Apple and Nvidia.
Since 2020, Saylors own company MicroStrategy, has accumulated 386,700 BTC at a cost of $21.9 billion, now valued at nearly $37.6 billion with Bitcoin priced at $97,200. This aggressive strategy has propelled MicroStrategy’s shares up an incredible 465.5% in 2024. Saylor’s says his pitch wasn’t just aimed at Microsoft board, it was a call to action for every company to consider the transformative potential of Bitcoin.
Grayscale files for Solana ETF with NYSE
Grayscale Investments has officially filed for a Solana (SOL) ETF, aiming to bring the first Solana-focused ETF to market. Grayscale’s current SOL Trust is the largest in the world, accounting for approximately $134 million, or 0.1% of SOL’s circulating supply.
This move makes Grayscale the fifth asset manager to file for a Solana ETF, following Bitwise, VanEck, 21Shares, and the newly formed Canary Capital, all of which announced similar plans earlier this year. Solana’s price surged 8% following the announcement, highlighting market optimism.
With a likely pro-crypto SEC chairman expected to replace Gensler soon, regulatory easing could pave the way for Solana ETF approvals during this cycle. Such developments would likely act as a major catalyst, driving SOL’s price into new territories.
Grayscale is aiming to get ahead of competing fund managers in the race for a Solana (SOL) ETF, with its first approval date set for 23 January 2025 - two days ahead of its rivals, who are scheduled for 25 January. Notably, Grayscale’s approval date coincides with key events: three days after Gary Gensler’s departure from the SEC and three days into Trump’s presidency, potentially aligning its launch with a favourable regulatory and market environment.
Richard Branson and Virgin Cruise Accepts Bitcoin
Richard Branson and Virgin Voyages have become the first cruise line to accept Bitcoin as payment. Their exclusive Virgin Voyage pass, priced at $120,000 per year, offers unlimited cruises for 12 months. This move places Virgin Voyages alongside major players like Ferrari and Microsoft in embracing Bitcoin. As Bitcoin continues its path toward greater institutional adoption, we could see an increasing number of major companies following suit.
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