Stablecoins trend toward new record volumes as MicroStrategy and MARA accumulate Bitcoin
DATA from CryptoCompare shows that the price of Bitcoin dropped by 3% from more than $98,000 to now stand around the $95,000 after the cryptocurrency failed to breach the $100,000 mark once again.
Ethereum’s Ether - the second-largest cryptocurrency by market capitalisation – moved up 3% over the past week, starting it at around $3,480 and moving to a $3,750 high before enduring a correction, to now trade at $3,600.
Headlines in the cryptocurrency space this week revealed that stablecoin trading volumes surged 77.5% in November to $1.81 trillion as of the 25th, placing these on tracks to record a yearly high and surpass the previous record seen in March.
That’s according to CCData’s latest Stablecoins & CBDCs report, which notes the broader stablecoin sector’s market capitalization grew 9.94% to $190 billion, above the previous $188 billion all-time high seen in April 2022, ahead of the collapse of the Terra ecosystem.
The stablecoin sector’s growth comes even as leading issuer Tether moved to axe its euro-pegged stablecoin, EURT, ahead of the European Union’s implementation of its Markets in Crypto Assets (MiCA) regulation.
MiCA, which is set to come into full effect by the end of the year, imposes rigorous compliance standards on stablecoin issuers operating within the EU. Tether, which has not obtained the necessary Electronic Money Institution (EMI) license, has been a vocal critic of the new regulations while rival issuer Circle has fulfilled the regulatory requirements. Nevertheless Coinbase has dropped its USDC yield program for European users over MiCA.
MicroStrategy makes record $5.4 billion Bitcoin purchase
Over the week, Nasdaq-listed business intelligence firm MicroStrategy made a record $5.4 billion Bitcoin purchase, acquiring 55,500 BTC at an average price of $97,862 per coin. The purchase moved its average price paid per BTC to $56,761.
The purchase helped MicroStratgy’s Bitcoin holdings grow to 386,700 BTC, which the firm acquired for around $21.9 billion and are now worth more than $36 billion. Similarly, Bitocin miner MARA Holdings acquired 6,474 BTC over the week for around $615 million.
The company, whose total cryptocurrency holdings total around $3.3 billion, noted that it has about “$160 million in remaining proceeds available net of transaction costs for future BTC dip purchases".
Another corporate-focused headline revealed that Howard Lutnick, the billionaire CEO of Cantor Fitzgerald and a key figure in the incoming administration, is reportedly discussing receiving backing from Tether for a multi-billion dollar lending program to lend dollars to clients who use BTC as collateral. The program is set to start at around $2 billion, but it’s expected to grow into the tens of billions.
Leading cryptocurrency exchange Binance also made headlines with the launch of a “reward-bearing margin asset” BFUSD, allowing users to earn passive rewards by holding or trading futures with it.
The asset is “not a stablecoin” as it can ““only be used as margin for futures trading on Binance, and redeemed with Binance for USDT stablecoin". The asset cannot be withdrawn from the exchange, and generates returns through a combination of delta hedging and staking Ether.
Meanwhile, a Brazilian lawmaker has introduced a bill to establish a Bitcoin reserve in the country, suggesting allocating up to 5% of its $372 billion international reserves to the “Reserva Estratégica Soberana de Bitcoin (RESBit)”, through a phased acquisition strategy.
SEC secures record $8.2 billion in remedies
This week it was also revealed that the US Securities and Exchange Commission (SEC) has received a record $8.2 billion for penalties and fines from its enforcement actions in the 2024 fiscal year, its highest amount in history, with most coming from the Terraform Labs settlement-
Without Terraform Labs’ settlement, the SEC would have brought in $3.72 billion, which would make it the regulator’s worst year for financial remedies since 2013. Notably, it isn’t expected to collect the entire $4.5 billion, as it agreed to be paid after Terraform satisfies crypto loss claims.
Meanwhile, a federal appeals court has ruled that the US Treasury Department’s sanctions against the cryptocurrency mixing service Tornado Cash were unlawful, overturning a lower court ruling.
The appeals court disagreed, ruling that the Treasury Department had “overstepped its congressionally defined authority” by sanctioning the service's underlying smart contracts, which are lines of computer code that operate autonomously.
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.
