December 13, 2024

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Trading Desk Insights

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The U.S. PPI came in hotter than anticipated on Thursday, prompting investors to adopt a more defensive stance and sustaining demand for the dollar. BTC has slipped 1.5% since the data release, with a pullback toward the 20-day moving average near $98,000 looking increasingly likely.

Chainlink (LINK) surged to nearly $31, marking its highest level since November 2021, after Trump’s World Liberty increased its stake in the project. World Liberty Financial purchased an additional $1 million worth of LINK late Thursday, marking two consecutive days of accumulation. LINK is now the firm’s fourth-largest holding, trailing only ETH, BTC, and USDT.

The total market capitalization of stablecoins has surpassed $200 billion for the first time. This growth is fueled by capital inflows for crypto trading and increasing adoption for non-crypto use cases such as payments. Bitwise Asset Management projects that the stablecoin market could double to $400 billion by next year, especially if the U.S. Congress passes favorable legislation.

Meanwhile, crypto miners are adopting MicroStrategy’s accumulation playbook, driven by increasing profitability pressures stemming from April’s upcoming halving and a rising network hashrate. Riot Platforms recently acquired 5,117 BTC for $510 million at an average price of $99,669 per BTC, bringing its total holdings to 16,728 BTC, now valued at approximately $1.68 billion.

In a significant institutional development, BlackRock issued its first specific recommendation for Bitcoin ETF exposure, advising a 1-2% allocation. The firm’s team noted, “We think that’s a reasonable range for Bitcoin exposure.”

Sei (SEI) is set to unlock $49 million worth of tokens on December 15, representing 2% of its circulating supply.

On the regulatory front, legislation was introduced in the Texas House on Thursday to establish a strategic bitcoin reserve, potentially paving the way for broader adoption by the U.S. Treasury. Meanwhile, the SEC remains active: the agency charged Cantor Fitzgerald for disclosure violations tied to blank-check companies, and issued a settlement demand to Elon Musk over his 2022 Twitter share dealings. Musk’s attorney, Alex Spiro, labeled the SEC’s investigation as harassment and claimed it is improperly motivated.

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The News Room

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Grayscale Launches Lido DAO and Optimism Trusts to Expand Ethereum Investment Options

Grayscale Investments has launched two new crypto trusts, the Grayscale Lido DAO Trust and Grayscale Optimism Trust, aimed at providing institutional and accredited investors exposure to Ethereum-related tokens. These products target Lido DAO's staking accessibility and Optimism's scalability solutions, key areas of Ethereum’s ecosystem. Available exclusively to accredited investors, the trusts directly invest in LDO and OP tokens without requiring holders to manage the assets themselves. The announcement coincides with a price surge in LDO and OP, which have risen over 20% and 11%, respectively, in the past 24 hours.

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Solana Surpasses Ethereum as Leading Ecosystem for New Developers

Solana has overtaken Ethereum as the leading ecosystem for new developers in 2024, onboarding 7,625 developers compared to Ethereum’s 6,456, according to a Dec. 12 Electric Capital report. This marks the first time since 2016 that Ethereum has been surpassed in this category, driven by Solana’s 83% jump in activity, particularly in Asia. However, Ethereum retains its crown as the top ecosystem for total developer activity globally, despite a 17% decline in monthly developer numbers to 6,244. Layer-2 networks on Ethereum have also grown significantly, with Eigenlayer leading as the fastest-growing protocol at 167%. The report highlights global growth in crypto development, with Africa, South America, and Asia seeing notable increases, particularly in stablecoin transactions and NFT trading aligned with regional time zones.

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New SEC Chief Paul Atkins Poised to Revamp Crypto Regulation, But Change May Take Time

President-elect Donald Trump’s nomination of pro-crypto businessman and former SEC Commissioner Paul Atkins to lead the agency marks a win for the cryptocurrency industry, though immediate regulatory shifts may be limited. Atkins, known for advocating innovation and reducing red tape, has criticized the SEC’s aggressive enforcement tactics under outgoing Chair Gary Gensler. While Atkins is expected to bring more clarity and reduce regulatory barriers for the crypto sector, changes will likely unfold gradually, given existing legal precedents and pending lawsuits involving firms like Coinbase and Ripple. Observers anticipate a more industry-friendly approach but caution against expecting a rapid overhaul.

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Disclaimer

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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.

Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. The price of crypto assets may rise or fall because of changes in the broad market or changes in a company's financial condition, sometimes rapidly or unpredictably. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives, if any, referred to in this research.

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