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Burkett Financial Services Diversifies with Bitcoin ETF Investments
Burkett Financial Services, a financial planner from South Carolina, has ventured into Bitcoin investments, adding shares from two exchange-traded funds (ETFs) focused on Bitcoin to its portfolio, as revealed in its Form 13F filing on April 1. The firm has invested in 602 shares of the iShares Bitcoin Trust (IBIT) by BlackRock, a spot Bitcoin ETF, worth approximately $24,363, and 630 shares of ProShares' Bitcoin Strategy ETF (BITO), which is tied to Bitcoin futures, valued at $20,344. Despite these cryptocurrency investments representing a minor fraction of Burkett's disclosed $194 million investment portfolio, this move marks Burkett as the pioneering traditional financial institution to adopt Bitcoin ETFs. This development coincides with growing discussions and optimistic forecasts surrounding spot Bitcoin ETFs, including predictions from Bitwise's CIO Matt Hougan of potential $1 trillion inflows if global wealth managers allocate a mere 1% to Bitcoin, and Ark Invest's Cathie Wood suggesting a significant value increase in Bitcoin with higher institutional allocation.
a16z Speedrun Program Injects $30M into Startups at the Intersection of Gaming, Web3, and AI
Andreessen Horowitz (a16z) is channeling $30 million into startups through its a16z Speedrun program, as announced by General Partner Andrew Chen. This initiative aims to invest $750,000 in each startup over the next 45 days, offering them mentorship and exposure to leading investors. This program, under the guidance of Chen who leads the $600 million Game Fund One, will focus on startups at the nexus of gaming, web3, artificial intelligence, virtual reality, and augmented reality. With a highly selective acceptance rate of ~1% in the last cohort, Speedrun seeks to nurture startups with not just capital but also industry expertise and a network of successful entrepreneurs from companies like Roblox, Discord, and Riot Games. The announcement also underscores a16z's broader investment strategy in blockchain gaming and artificial intelligence, signaling a robust support system for early-stage startups. The application deadline for the next Speedrun cohort is set for May 19.
Hut 8 Eyes Diversification into HPC and AI Post-US Bitcoin Corp Merger, Aims for Strategic Growth Amidst Bitcoin Halving
Hut 8, post-merger with US Bitcoin Corp, aims to cautiously leverage its significant Bitcoin assets amidst the upcoming halving while diversifying its revenue beyond the predominant 70% from crypto mining. CEO Asher Genoot highlighted during an earnings call the company's initiative to expand into high-performance computing (HPC) and AI sectors, having ventured into HPC with the acquisition of TerraGo and partnering with Canadian health authority Interior Health for colocation HPC services. Despite the HPC segment being in its nascent stages requiring further investment, especially in AI and data center capabilities, Hut 8 sees potential growth. Holding 9,110 BTC valued at approximately $650 million, the company plans disciplined growth strategies around the Bitcoin halving, exploring M&A opportunities without compromising on cost efficiency. With a cautious approach to purchasing mining machines, possibly post-halving or for next-gen equipment, and enhancing operational efficiencies, Hut 8 is positioned to adapt and expand in the evolving crypto and tech landscapes.
Trading Desk Insights
Bitcoin's slide deepened, touching down at $64,500 amidst a backdrop of a strengthening dollar index, which breached 104.75, and a spike in the 10-year yield to 4.4% for the first time since last November. The uptick in U.S. manufacturing activity in March, as revealed by Monday's data, has scaled back June rate cut expectations, underscoring the economy's enduring strength. Market sentiment suggests Bitcoin might hover within a tight range in the near term, as heavyweight investors begin to dial back their stakes.
In the realm of ETFs, the landscape was marred by significant outflows, amounting to $85.8 million. Notably, Grayscale saw its outflows swell to $302.6 million, and ARK experienced a minor exodus of $0.3 million, marking its first day of net withdrawals.
The equity market is bracing for further dips as the new quarter commences, with bond yields on the rise and fading hopes for a Federal Reserve rate cut in June adding to the pressure. The onset of Q2 has been challenging for stocks, fueled by persistent inflation concerns and robust economic indicators that propelled yields upward. Additionally, oil prices reached a five-month peak on Tuesday, intensifying inflation fears.
The ISM manufacturing index indicated growth, breaking a 16-month streak of contraction. The 10-year Treasury yield has climbed to a six-month zenith of 4.39%. The likelihood of a June rate cut, as inferred from fed futures trading, has receded to approximately 57%, down from 70% the previous week, reflecting a recalibration of market expectations amidst evolving economic conditions.
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This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
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