June 13, 2024

Markets Insights

Economic Calendar

ETF Dashboard

‍

The News Room

‍

MicroStrategy Announces $500 Million Convertible Note Offering to Purchase More Bitcoin

MicroStrategy is planning a $500 million convertible senior note offering to purchase more Bitcoin and for general corporate purposes. The company, which holds 214,400 BTC, also announced the redemption of $650 million in 2025 convertible notes. The new notes, due in 2032, will be offered to institutional investors and are convertible into cash or MicroStrategy stock. This move aligns with MicroStrategy's strategy of using debt to expand its Bitcoin holdings. The firm’s Bitcoin investments total $7.54 billion, now valued at $14.5 billion. Additionally, the company will redeem the 2025 notes on July 15.

‍

Taiwan Establishes Crypto Industry Association to Promote Self-regulation

Taiwan has launched the Taiwan Virtual Asset Service Provider Association, comprising 24 registered crypto firms, to develop self-supervisory rules under government guidance. The association, led by Titan Cheng and Winston Hsiao, aims to enhance oversight and ensure compliance with anti-money laundering regulations set by the Financial Supervisory Commission. This initiative marks a significant step towards regulating Taiwan's cryptocurrency sector.

Australia's Treasury to Draft Stablecoin Rules in New Crypto Bill Amid ASIC's Warning to Crypto Entities

Australia's regulators plan to include stablecoin legislation in the upcoming draft bill for the digital assets sector. This announcement was made during an event hosted by Blockchain Australia, now rebranded as the Digital Economy Council of Australia (DECA). The Australian Treasury aims to release this draft legislation by the end of 2024, covering licensing and custody rules for crypto asset providers. Additionally, the Australian Securities and Investments Commission (ASIC) has been holding meetings with global regulators like the SEC to discuss crypto legal positions and plans to enhance enforcement against unlicensed crypto entities.

‍

Trading Desk Insights

‍

Bitcoin has demonstrated remarkable stability recently, holding steady above $67,000, despite the Federal Reserve's hawkish interest rate forecasts. With the stock market reaching record highs, it is anticipated that Bitcoin may soon follow suit. However, we should be prepared for some short-term resistance around $70,000, with the more substantial barrier being at $72,000. BTC has outperformed ETH by 10% since the end of May.

In the US BTC ETFs market, we observed a notable shift from outflows to inflows totaling $100.8 million, primarily driven by Fidelity, which contributed $50.6 million.

Curve's token (CRV) experienced a significant drop of 30% last night, falling to $0.22. This plunge occurred as some loan positions, reportedly connected to its founder Michael Egorov, began to liquidate automatically, causing a rapid selling spree. Consequently, the number of CRV tokens held in wallets linked to centralized exchanges surged by 57% early Thursday, reaching record highs of over 480 million, indicating a strong intention among investors to sell the token.

In other developments, Terraform Labs and its former CEO, Do Kwon, have reached a settlement agreement with the SEC. This agreement involves a combined payment of $4.5 billion in disgorgement and civil penalties. The settlement is pending approval by the New York judge overseeing the case. Additionally, the agreement includes a permanent ban on Kwon and Terraform Labs from buying and selling crypto asset securities.

MicroStrategy, a Nasdaq-listed company holding 214,400 BTC valued at $14 billion, plans to offer $500 million in aggregate principal amount of convertible senior notes due 2032. The proceeds from this offering will be used to acquire additional Bitcoin and for other corporate purposes.

On Thursday, S&P 500 futures rose following the broad market index's close above 5,400 for the first time. This increase came after the Federal Reserve's latest interest rate decision and a May consumer inflation report that showed cooler-than-expected results. Investors received another update on inflation on Thursday morning, with May’s producer price index coming in below estimates.

At the conclusion of its policy meeting on Wednesday, the Fed signaled only one rate cut in 2024, down from the three previously forecasted in March. The "dot plot," which reflects the projections of 19 FOMC members, showed four officials in favor of no cuts this year, seven projecting one reduction, and the remaining eight forecasting two rate cuts for 2024.

In other news, Treasury Secretary Janet Yellen stated on Thursday that the national debt remains manageable as long as it stays at its current level relative to the overall economy.

‍

‍

Crypto Charts

‍

Macro Charts

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.

Unless otherwise provided in a separate agreement, Secure Digital Markets does not represent that the report contents meet all of the presentation and/or disclosure standards applicable in the jurisdiction the recipient is located. Secure Digital Markets and their officers, directors and employees shall not be responsible or liable for any trading decisions, damages or other losses resulting from, or related to, the information, data, analyses, or opinions within the report.

Crypto and/or digital currencies involve substantial risk, are speculative in nature and may not perform as expected. Many digital currency platforms are not subject to regulatory supervision, unlike regulated exchanges. Some platforms may commingle customer assets in shared accounts and provide inadequate custody, which may affect whether or how investors can withdraw their currency and/or subject them to money laundering. Digital currencies may be vulnerable to hacks and cyber fraud as well as significant volatility and price swings.

‍