Bitcoin Breaks All Time High!

Bitcoin has reached a new all-time high of $75,000, marking a significant milestone in its history. This surge coincides with Donald Trump's victory in the U.S. presidential election, as reduced uncertainty around the result and his pro-crypto stance have bolstered market confidence. Over the past 24 hours, crypto's total market capitalisation has increased by 6.58%.

Historically, Bitcoin has shown a strong tendency to skyrocket following an all-time high (ATH), often triggering substantial upward momentum as it attracts fresh interest and capital from both seasoned and new investors. For instance, after reaching an ATH in December 2020, Bitcoin surged rapidly, achieving consecutive monthly returns averaging over 30% from December through to March.

Weekly Price Update

Trump Wins, Crypto Wins

Throughout his campaign, Trump embraced a notably pro-Bitcoin stance, pledging to elevate Bitcoin's role within the nation’s financial strategy. His greatest proposal involves adding Bitcoin to the national reserve, with a promise to hold it indefinitely. This bold move, if executed, could fundamentally reshape how national reserves are conceptualised and should the U.S. reserve include Bitcoin, it may inspire other nations to follow suit, establishing Bitcoin as a cornerstone of national wealth.

In addition to his pro-Bitcoin stance, Trump has vowed to fire Gary Gensler, the current SEC chairman on his first day in office. Gensler’s tenure has been characterised by regulatory scrutiny over digital assets, with policies that many argue have hindered innovation in the U.S. crypto space. Trump’s promise to replace Gensler signals a shift towards a more crypto-friendly regulatory environment, easing pathways for investors, institutions, and developers. As he put it in a rallying call to Bitcoin supporters: “I pledge to the Bitcoin community that the day I take the oath of office, Joe Biden and Kamala Harris’ anti-crypto crusade will be over… it will end. It will be done.” Trump also pledged to establish a dedicated crypto advisory council to craft clear, growth-focused policies for digital assets, reinforcing his commitment to creating a welcoming regulatory landscape for Bitcoin and blockchain technology in the U.S.

A more relaxed stance from the SEC could make Bitcoin investment options much more accessible, boosting interest and liquidity across both retail and institutional markets. This shift might set off a “golden bull run” for Bitcoin, with the U.S. emerging as a global Bitcoin hub and attracting unprecedented institutional demand. If the U.S. backs Bitcoin in its national reserves, other governments and institutions may follow, sparking a supply crunch that could push prices to new heights. Official U.S. endorsement of Bitcoin as part of its economic strategy would reinforce its role as “digital gold,” strengthening its appeal as a safeguard against inflation and economic uncertainty.

MicroStrategy Plans to Raise $42 Billion for Bitcoin Purchases

MicroStrategy, led by CEO Michael Saylor, has announced an ambitious plan to raise $42 billion over the next three years to acquire additional Bitcoin. Dubbed the "21/21 plan," this strategy involves raising $21 billion in equity and $21 billion in fixed-income securities, underscoring the company's strong commitment to Bitcoin as a primary treasury asset. Currently holding 252,220 BTC, MicroStrategy would more than triple its holdings if successful, acquiring about 578,586 BTC, equivalent to 2.7% of Bitcoin’s total supply. This bold strategy could set a powerful precedent, inspiring more corporations to integrate Bitcoin into their treasury management strategies. With MicroStrategy currently sitting on approximately $9 billion in unrealised profits from its Bitcoin holdings, other companies may increasingly view Bitcoin as a viable asset for long-term value preservation and growth, should this approach continue to prove profitable.

Binance Lists Cetus - Surges 78%

Binance has recently listed Cetus, the largest decentralised exchange (DEX) on the Sui blockchain, which boasts a total value locked (TVL) of $200 million. Our analyst team first identified Cetus when its market capitalisation was at $16 million. Following the Binance listing, Cetus experienced a 78% gain today, elevating its market cap to $100 million, a 6.25x increase from our initial call. Given Cetus's integral role within the Sui ecosystem, its growth potential is closely linked to Sui's expansion, potentially offering higher returns as Sui develops. We maintain a bullish outlook on Cetus and the broader Sui ecosystem.

Coinbase Q3 Earnings Report

Coinbase's Q3 2024 earnings report presented a mixed picture, leading to a 15.3% single-day stock decline—the largest in two years—as results fell short of analyst expectations. The company reported earnings per share of $0.28, missing the consensus estimate of $0.45, and revenue of $1.21 billion, below the anticipated $1.26 billion. This performance has raised concerns about Coinbase's immediate financial health and growth trajectory.

Additionally, Coinbase's board authorized a $1 billion share repurchase program, further demonstrating confidence in the company's future prospects. Despite the earnings miss, Coinbase remains optimistic about the growing interest in crypto assets and regulatory progress ahead of the 2024 elections. For Q4, the company forecasts subscription and services revenue between $505 million to $580 million, indicating a strategic focus on diversifying revenue streams.

Despite recent earnings challenges, Coinbase can celebrate Base's success as it solidifies its position as the top Layer 2 (L2) ecosystem, leading with a Total Value Locked (TVL) of $2.5 billion. The platform has achieved a 55% quarter-over-quarter increase in transactions and handles nearly 4x the transactions per second (TPS) compared to the second-largest Ethereum ecosystem, Arbitrum. As one of the fastest-growing ecosystems in the space, Base’s rapid adoption and high transaction throughput make it an attractive environment for both developers and users, prompting us to continue exploring potential opportunities within this ecosystem.

Base Eco-System TVL

Ethereum Compared to Amazon in the 1990s

21Shares, a cryptocurrency investment firm, has drawn comparisons between Ethereum's current position and Amazon's status in the 1990s. The firm suggests that, like Amazon during its early years, Ethereum has substantial growth potential and could become a dominant force in the digital economy. This analogy underscores the belief in Ethereum's long-term value proposition and its foundational role in the blockchain ecosystem.

Wall Street investors largely remain unaware of Ethereum's transformative potential, with some analysts comparing its current state to Amazon in the 1990s—underestimated but poised for substantial growth. Ethereum’s spot exchange-traded funds (ETFs), launched in July, have seen relatively small inflows compared to Bitcoin’s, highlighting that Ethereum’s complexity and use cases are potentially still underappreciated by traditional finance. Research Analysts at 21Shares suggests that large inflows into Ether ETFs will follow as investors better understand Ethereum’s applications in decentralized finance, tokenization, and beyond.

Like Amazon, which evolved from an online bookstore to a global tech giant, Ethereum’s platform has progressed from supporting basic smart contracts to a robust network powering over $140 billion in decentralised finance applications. Ethereum has already attracted the likes of BlackRock, PayPal, and Visa, who are building solutions on its blockchain. Despite some initial caution among short-term investors, the market for Ethereum ETFs is expected to gain momentum as institutional players grow more familiar with its potential.

First UK Pension Fund Invests in Bitcoin

In a landmark move, a UK pension fund has made its first investment in Bitcoin, signalling a growing acceptance of cryptocurrencies within traditional finance. This decision marks a step towards mainstream adoption of digital assets as institutional investors start to view Bitcoin as a viable investment option. Following a lengthy consultation process, the pension fund has allocated 2-3% of a defined benefit scheme to Bitcoin, citing the potential for substantial upside from this investment.

With around $2.5 trillion invested in UK pension funds, a 3% allocation to Bitcoin would equate to approximately $75 billion, or around 4.8% of Bitcoin’s total supply. Given Bitcoin’s limited supply, combined with rising demand from institutional investors such as pension funds, a supply shock could be on the horizon—one that may act as a powerful catalyst for driving Bitcoin’s price higher.

This week, the State of Michigan’s Pension Fund became a top five holder of Grayscale's Ethereum ETF. The state has allocated US$11 million into these Ether ETFs, surpassing its existing US$7 million investment in Bitcoins ETF. The State has become one of the first to report significant holdings in the ETH investment vehicle.

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