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FTX and the IRS have agreed upon a settlement of around $885 million
FTX debtors have reached a settlement with the IRS, agreeing to pay approximately $885 million. This amount includes a payment of $200 million upfront, with the remaining $685 million contingent upon available funds and subject to lower priority status. The settlement, significantly less than the IRS's original claim of $24 billion, is part of FTX's bankruptcy proceedings overseen by Judge John Dorsey. FTX's estate is also preparing a reorganization plan, aiming to repay creditors with funds totaling between $14.5 and $16 billion, albeit at November 2022 prices, which has sparked some criticism but is deemed legally sound by Judge Dorsey.
Bitcoin Miner, Core Scientific Soars on AI Deal, $1B+ Buyout Offer from CoreWeave
CoreWeave, a cloud computing provider, offered to purchase Bitcoin miner Core Scientific at $5.75 per share, leading to a 40% surge in Core Scientific's pre-market trading. This offer, made on Monday, represents a 55% premium to Core Scientific's three-month average share price as of May 31, valuing the company at over $1 billion. CoreWeave also signed a 12-year AI hosting deal with Core Scientific worth about $300 million, amidst a wave of mergers and acquisitions in the mining sector.
The GME tribute token on Solana saw a significant 150% spike in its price as GameStop shares surged due to the return of influential trader Roaring Kitty. This increase in the GME token's value, reaching around $0.01, was accompanied by a surge in trading volume from $15 million to $280 million, indicating substantial demand. Meanwhile, GameStop's stock price nearly doubled from under $23 to over $40 following Roaring Kitty's social media comeback, resulting in short sellers facing potential losses of nearly $1 billion. However, both GameStop's share price and the GME token's value have cooled down since their peak prices.
Trading Desk Insights
Market conditions persist in a narrow range, exhibiting a lack of decisive moves from traders. It appears that we may be entering the customary summer slowdown, although the prevailing low trading volumes and stagnant markets are more likely attributable to the absence of clear catalysts prompting a breakout. Both BTC and ETH saw marginal fluctuations over the previous week, with market attention directed towards forthcoming macroeconomic events, notably the CPI and FOMC minutes next Wednesday, as well as PPI data the following Thursday, alongside the imminent launch of spot ETH ETFs within the upcoming weeks. Throughout the remainder of the year, macroeconomic developments will continue to heavily influence trader sentiment.
Despite adverse economic indicators, market sentiment remains buoyant, buoyed by steadfast conviction among long-term investors and the anticipation of additional spot ETF approvals. On-chain analytics indicate that over half of the Bitcoin supply remains inactive, underscoring robust long-term confidence in the asset.
Examining US BTC ETFs, the market is absorbing a fresh round of capital inflows totaling $105.1 million, spearheaded by a significant $77 million contribution from Fidelity. Accumulated Bitcoin holdings within BTC investment vehicles have soared to an unprecedented high, surpassing 1.1 million BTC. May witnessed substantial net inflows of 32,690 BTC, offsetting the outflows experienced in April.
In related news, DWF Labs has committed to acquiring $12 million worth of Floki tokens to bolster the burgeoning ecosystem of the meme coin. Floki is poised to unveil new offerings in the upcoming months, including the Valhalla metaverse game on its mainnet.
Meanwhile, stock futures experienced a downturn on Tuesday as Wall Street sought stability following an erratic start to the month. Dampened market sentiment was attributed to lackluster manufacturing data, prompting investor scrutiny over the sustainability of growth amidst the Federal Reserve's stance on inflation. Economic data remains in focus, with April's job openings and factory order data slated for release at 10 a.m. ET on Tuesday. The highlight of the week awaits on Friday with the May payrolls report.
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Disclaimer
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.
The information on which the analysis is based has been obtained from sources believed to be reliable such as, for example, the company’s financial statements filed with a regulator, company website, company white paper, pitchbook and any other sources. While Secure Digital Markets has obtained data, statistics, and information from sources it believes to be reliable, it does not perform an audit or seek independent verification of any of the data, statistics, and information it receives.
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