Bitcoin flying high after a week of uplifts for cryptocurrency
DATA from CryptoCompare shows that the price of Bitcoin moved up significantly over the past week to hit a new $82,300 all-time high after seeing a 19.2% rise after Republican candidate Donald Trump won the US presidential elections.
Ethereum’s Ether - the second-largest cryptocurrency by market capitalisation – saw stronger performance, surging from around $2,400 to a high above $3,200 per token before seeing a slight correction.
Headlines in the cryptocurrency space this week revealed that Bitcoin’s significant price rise helped BlackRock’s spot BTC exchange-traded fund (ETF), the iShares Bitcoin Trust (IBIT) see $1.1 billion inflows in a single day, with the 11 spot Bitcoin ETFs listed in the United States recording total inflows of $1.34 billion that day.
Bitcoin’s price rise and these ETF inflows came after Trump secured a victory in the US presidential elections. The Republican candidate had a pro-crypto stance during his campaign, vowing to create a strategic Bitcoin reserve for the United States and calling for every remaining BTC to be mined in the country, among other things.
Over the week several companies doubled down on their Bitcoin strategies, with Jack Dorsey’s financial technology firm Block revealing it will increase its investment in BTC mining and on self-custody wallet Bitkey, while winding down other ventures.
In its third-quarter shareholder letter, the firm highlighted the ““strong product market fit” and “healthy pipeline of demand” of its Bitcoin mining initiative, and revealed it will scale back investments in ventures including streaming app Tidal and decentralized web platform Web5.
Similarly, healthcare technology firm Semler Scientific announced it will keep on accumulating Bitcoin after adding an additional $2.6 million worth of the cryptocurrency to its holdings after the end of the third quarter.
Bitcoin’s open interest on centralized exchanges has been rising over the past few weeks, and hit a new all-time high of $48.3 billion in October, according to CCData’s latest Exchange Review report, with institutional trading venue CME capturing 30.6% of open interest.
On top of all this, Nasdaq-listed cryptocurrency exchange Coinbase deployed its wrapped Bitcoin token, cbBTC, on the Solana blockchain to further expands its reach within the decentralized finance ecosystem.
Coinbase’s cbBTC is pegged to the value of the cryptocurrency and backed by BTC custodied on the cryptocurrency exchange. Growing demand for BTC has helped its mining difficulty rise 6.2% to surpass 100 trillion for the first time at block height 868,896, with the difficulty adjustment leading to an unprecedented 101.7 trillion.
Crypto consortium launches USDG stablecoin with yield-sharing model
While Bitcoin captured the attention of cryptocurrency community with its stellar performance, others kept on developing new products and services. This week, a consortium of major crypto firms including Anchorage digital, Bullish, Galaxy Digital, Kraken, Paxos, and Robinhood launched a new stablecoin designed to share the yield earned on reserve assets with participants.
The stablecoin, called the Global Dollar (USDG) is issued out of Singapore by Paxos Trust Company, and is designed to be compliant with the region’s upcoming stablecoin regulatory framework.
This week also saw the Union Bank of Switzerland (UBS) launch a tokenized money market fund on the Ethereum blockchain, the “UBS USD Money Market Investment Fund Token,” or “uMINT,” which offers holders access to UBS’s “institutional-grade cash management solutions.
In a statement Thomas Kaegi, co-head of UBS APAC, said that the firm has been seeing a “growing investor appetite for tokenized financial assets across asset classes.” UBS’s latest venture follows a successful pilot of the tokenized money market fund in October 2023.
Michigan state retirement fund invests in spot Ethereum ETFs
The State of Michigan Retirement System has become the first major U.S. pension fund to publicly disclosed a position in spot Ethereum exchange-traded funds (ETFs) this week, through an investment of around $10 million in Grayscale’s Ethereum Trust.
The investment makes the fund a top-five holder in the Ethereum-focused spot ETF, while it also holds 460,000 shares of the Grayscale Ethereum Mini Trust ETF, valued at around $1.1 million.
Notably, this week also saw prominent investment firm 21Shares file an S-1 registration statement with the US SEC to launch a spot XRP ETF, joining a growing number of firms looking to launch such a fund.
Francisco Memoria is a content creator at CryptoCompare who’s in love with technology and focuses on helping people see the value digital currencies have. His work has been published in numerous reputable industry publications. Francisco holds various cryptocurrencies.
