Still waiting ⏳
Still waiting ⏳
More waiting for the ETFs. Idalia blocks Ron DeSantis. Vivek Ramaswamy, all about crypto. What's Residency by Adidas? How to convert texts into metaverse? And August struggled a bit.
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The SEC has hit the "snooze button" on the decision for the Bitcoin ETF proposal submitted by BlackRock, the world's largest asset manager.
Patience is a virtue, right?
Background
BlackRock, the "big kahuna" of asset management, has a whopping $8.5 trillion under their watch.
The firm had submitted an application to the SEC to offer a BTC-backed ETF under its iShares Bitcoin Trust.
Coinbase was slated to act as the custodian of the proposed fund's Bitcoin holdings, while the Bank of New York Mellon would manage its fiat accounts.
Delayed, not denied: SEC has postponed decisions on six spot Bitcoin ETF applications. Big names like WisdomTree, VanEck, Invesco Galaxy, Bitwise, Valkyrie, and Fidelity are all in the "Waiting Room". It's pretty crowded in there.
The Calendar for delays
The SEC has given themselves an extra 45 days to deliberate, which means by October, they'll either approve, deny, or potentially delay again.
Global X has a deadline of October 7.
The big majority will be addressed by October 17, with exceptions.
Bitwise, set for October 16.
Valkyrie, scheduled for October 19.
Previously, decisions were expected to be out in the open by September 2.
Grayscale had a legal face-off with the SEC, and, in a twist, now the SEC has to consider Grayscale’s proposal to convert its Bitcoin Trust into an ETF. This development has made many optimistic about a potential approval.
They've refiled their application after WisdomTree's unsuccessful attempt with the SEC in 2021. Following murmurs that the SEC might be receptive to ETFs with surveillance-sharing agreements, several firms have named Coinbase as a potential partner.
The decision for Bitwise’s ETF was expected by Sept. 1, but with the upcoming Labor Day holiday, it seems the SEC is trying to clear their docket.
Bloomberg’s ETF maven, James Seyffart, suggested that this delay was predictable given the recent court directive that challenges the SEC's rationale behind its repeated denials.
Odds are… Seyffart now gives a 75% probability for a spot Bitcoin ETF green light in 2023, especially after Grayscale's legal triumph - hinting that the SEC might find it challenging to maintain its pattern of denials as looming deadlines approach.
The price reaction
Bitcoin experienced a surge on Aug. 29, reaching a two-week high - the Grayscale victory.
By Aug. 31, Bitcoin's price dropped nearly 5%, settling around $26,000 - the SEC hitting the pause button.
Grayscale’s December buyers reaping rewards
Recent trading dynamics show a profitable journey for those who dared to invest in Grayscale’s Bitcoin Trust (GBTC) during its most challenging times.
From a low of $8.29 per share on December 13 last year, GBTC's share value soared 137% to $19.71 as of the latest market opening. During this period, the Trust experienced its largest-ever discrepancy, where its share value was almost 50% lower than its actual Bitcoin holdings.
Outpacing Bitcoin’s growth
In the same duration, Bitcoin grew by 48%, from $17,800 to approximately $26,300. GBTC stole the show by surging way past it.
GBTC operates as a closed-end fund. This means its shares can't be directly redeemed for Bitcoin, resulting in occasional price discrepancies. The share's price deviates when it can't adjust with Bitcoin's price due to supply and demand constraints.
GBTC's discount gap widened after the FTX cryptocurrency exchange's collapse last year. A potential conversion of GBTC into a spot Bitcoin ETF, a transformation Grayscale has been eyeing for years, could eliminate this discount. With Grayscale's recent courtroom victory, the discount gap has reduced to below 20%.
The politics mix
Florida Governor Ron DeSantis had a special announcement up his sleeve, but Hurricane Idalia had other plans.
Reports surfaced about DeSantis' intention to accept crypto donations during a campaign event. But, on Aug. 30 - Hurricane Idalia decides to join the party by hitting Florida's coast.
DeSantis isn't alone in his crypto curiosity. Miami Mayor Francis Suarez and presidential candidates Vivek Ramaswamy and Robert F. Kennedy Jr. have also voiced interest in or accepted crypto contributions.
Ramaswamy's rhetoric
Presidential candidate Vivek Ramaswamy is challenging traditional narratives about cryptocurrency, especially within the GOP, by presenting the SEC as a problematic, overreaching entity.
Crypto stance
Strong supporter of crypto.
Criticised SEC for their decision against a Grayscale-backed Bitcoin ETF.
Sees SEC as a "shadow government" and problematic entity.
Doesn't tie SEC's crypto stance to Biden, as others do.
Campaign focuses on battling a so-called "deep state" of powerful bureaucrats.
Challenges the very existence of agencies like the SEC.
TTD Blockquote
Stacey King, Global Head of Communications and Activations for Adidas /// Studio.
“It felt like such a natural step to go ‘all in'"
"And create an even stronger pathway and platform for some of the coolest and most engaging artists in our community.”
Adidas's very own /// Studio (Three Stripes Studio) is launching "Residency by Adidas" - a platform that'll bring the limelight to global digital artists.
It will begin in September during Korea Blockchain Week. Here’s what we know now:
Initial Artists
MonkeeMoto: A Tokyo-based artist known for game development and digital concept design.
Adra Kandil (Dear Nostalgia): A Lebanese artist merging photography, collages, typography, and digital montages. Has worked with brands like Gucci and Chanel.
Program's Goal
To uplift digital creative talent.
Artists can both display their work and collaborate with Adidas on digital and future physical products.
NFT Drops
Limited edition: 100 works per artist at 0.15 ETH (~$250 each). Exclusive to Seoul event attendees and includes a physical hoodie.
Open edition: Priced at 0.03 ETH (~$50). No purchase limit. Available for all to mint between September 6-11.
Adidas has engaged with the Web3 community before, launching NFTs with connected apparel and NFT artwork in Berlin and NYC. Stacey King mentioned more digital and physical drops are in line.
Adidas' ALTS Ethereum NFT project will continue. Recently, they collaborated with BAPE on limited edition connected sneakers with digital twins.
Where’s ETF?🚨
The recent applications for a Bitcoin ETF by major financial institutions are actually a clever marketing strategy for Bitcoin?👇🏻
TTD Numbers 🔢
$1.25 billion
Web3 faced some tough times this year, with losses reaching $1.25 billion. And August? Well, it wasn’t Web3's favourite month, with a whopping $23.4 million lost.
August saw a loss of $15.8 million in crypto due to hacks/exploits.
Fraud led to losses of around $7.6 million in the month
A combined $23.4 million was lost to both hacks and fraud in August.
This amount is much lower compared to the $320.5 million lost in July.
Base's rocky debut
Coinbase’s Ethereum Layer 2 solution, Base, started with grand promises. But like many newbies, it faced its own set of hiccups. Since its August 9 launch, four projects stumbled, putting Base on everyone's radar - for not-so-great reasons.
Here’s the breakdown
Ethereum: Five bumps on its journey.
BNB Chain & Base: Four missteps each. Base’s culprits? LeetSwap, SwirlLend, Magnate Finance, and RocketSwap.
The Top Trio: Ethereum, BNB Chain, and Base made up 62% of all August chain losses.
Optimism: Experienced two incidents which comprise 9.5% of total losses.
Other Chains: Arbitrum, Solana, Avalanche, Fantom, and Linea each faced one incident, combining for 28.7% of losses.
Major incidents include:
Exactly protocol hack on Aug. 18: 4,323.6 Ether (equivalent to $7.2 million) stolen from users.
Magnate Finance on Aug. 25: Allegedly involved in a $6.5 million exit scam. DeFi detective zachXBT linked the Magnate Finance deployer address to this scam.
Euler Finance in March: Lost $195 million due to a malicious flash loan attack. The hacker, however, returned over 90% of the stolen assets after facing legal threats from the developers.
DeFi platforms were the exclusive target for August exploits. Centralised platforms, in contrast, remained unscathed.
TTD AI📍
Google’s generative AI tools can now convert your text into a virtual universe. Enter: Hiber3D, which has effortlessly blended Google's AI genius into its platform. With a simple type-and-watch magic, creators can now see their words morph into immersive worlds.
Text becomes reality in the Metaverse
It’s all about making the creation process slicker, quicker, and (let's be honest) a lot cheaper. The big reveal happened at the Google Cloud Next event in San Francisco where Hiber showcased how they're incorporating Google’s AI into their Hiber3D platform.
Hiber3D is the engine behind HiberWorld, a virtual playground already boasting over 5 million user-crafted worlds. And the best part? No coding required!
The trick is Hiber’s generative AI tool. According to Hiber’s CEO, Michael Yngfors, creators can simply use everyday language to instruct the Hiber3D platform. Want a rainy, Blade Runner-esque world? Or a sunny beach straight out of Baywatch? Just type it in. The AI does the rest.
AI x Web3
Google Cloud’s Engineering Director of Web3, Mr. Tromans, spills the beans on Google’s plans. While everyone's placing their bets, Google's playing the long game, seeking to create a harmonious relationship between AI and Web3.
“We have a horizontal strategy and a vertical strategy,” Tromans said, at Google Cloud Next event. “The horizontal strategy is to make sure that we can meet our customers where they are, Web3 natives, as well people that know the [tech] industry.”
Google Cloud has made significant strides into the Web3 landscape, marking its presence as a transaction validator on diverse blockchains. The creation of Google's dedicated Web3 team last year and its recent involvement as a transaction validator on networks like Axie Infinity’s Ethereum side-chain Ronin and Solana stands as a testament to its commitment.
TTD Adoption 🫂
Lufthansa’s Uptrip
Lufthansa, one of the world's largest airlines, has launched an NFT-based loyalty program called Uptrip. Passengers can collect digital trading cards themed around destinations, aircraft, and holidays when they fly with Lufthansa Group Airlines. By collecting specific sets of cards, users can unlock special perks such as free in-flight Wi-Fi, access to airport lounges, and redeemable airline miles.
Uptrip, built on the Polygon Ethereum scaling network, plans to add a trading feature for users to complete their collections. The program was previously tested with over 20,000 users who collected over 200,000 digital trading cards.
Swift and Chainlink lead Tokenisation tests
Swift, Chainlink, and 10 banks including Citi, BNP Paribas, and BNY Mellon have successfully conducted tokenization tests to move financial assets across traditional rails and blockchain networks. Swift used Chainlink's oracle provider to establish a connection with the Ethereum testnet, Sepolia. The tests involved sending tokenized assets between the testnet and other blockchains, aiming to link traditional financial assets with blockchain networks.
The Cross-Chain Interoperability Protocol (CCIP), launched by Swift and Chainlink, supports four blockchains and has been adopted by DeFi lending protocols Aave and Synthetix.
Nexo's "Dual Mode"
Nexo, a cryptocurrency company, has introduced a "dual mode" feature for its flagship crypto card, allowing users to switch between debit and credit modes. The functionality is now available to citizens and residents of the European Economic Area (EEA) after an exclusive early access stage. Users must pass an identity verification process using a valid EEA-issued identity document to qualify for the card.
TTD Surfer 🏄
HashKey Capital, a subsidiary of HashKey Group, is launching a fund that will focus on investing in altcoins.
Disgraced FTX founder SBF is looking to hire expert witnesses for his fraud trial and is willing to pay them $1,200 per hour.
Binance Australia General Manager Ben Rose is confident that Australian regulators will eventually make the right decisions about crypto.
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