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MicroStrategy Acquires 11,931 Bitcoin for $786 Million
MicroStrategy has purchased an additional 11,931 BTC for approximately $786 million at an average price of $65,883 per Bitcoin, increasing its total holdings to 226,331 BTC worth about $14.9 billion. This acquisition follows the completion of an $800 million convertible note offering. The company’s total Bitcoin holdings were bought at an average price of $36,798 per Bitcoin. MicroStrategy’s share price rose 2.4% in pre-market trading, and the stock has gained 112% year-to-date. The company initially proposed a $500 million note offering, later upsized to $800 million due to positive market reception, with net proceeds used to fund the Bitcoin acquisitions.
Singapore Flags Digital Payment Tokens as High-Risk in AML Framework
Singapore's updated Money Laundering National Risk Assessment (MLNRA) has identified digital payment token (DPT) service providers, or virtual asset service providers, as a high-risk category within the financial sector. The 126-page report, which highlights significant AML risks and vulnerabilities, introduces new risk sectors including DPT providers and precious stone and metal dealers. The banking sector, especially wealth management, poses the highest money laundering risks due to its transaction volume and high-risk customers. Despite Singapore's small share of global DPT activities, authorities monitor associated risks closely. The report also points to threats from fraud, organized crime, corruption, tax crimes, and trade-based money laundering, with criminals using methods such as fake companies and valuable asset investments. Singapore's financial hub status and economic openness make it susceptible to these risks. The Monetary Authority of Singapore plans to amend the Payment Services Act to enhance regulation of DPT services.
Italy to Boost Crypto Market Surveillance, Imposing Fines Up to 5M Euros
Italy is increasing surveillance of the crypto asset market with fines up to 5 million euros for insider trading, unlawful disclosure, or market manipulation, according to a draft decree to be approved by the cabinet. The measures are part of a broader effort to align with the EU's Markets in Crypto Asset (MiCA) regulatory framework. The decree designates Italy's central bank and market watchdog, Consob, as the supervising authorities. Despite low crypto exposure among Italian households, the country has mandated registration for crypto companies and has approved 73 firms as virtual currency service providers.
Trading Desk Insights
Bitcoin has faced considerable downward pressure since it dipped below its 50-day moving average, now targeting a range between $60,000 and $63,000. With the stock market showing signs of reversal since 8 AM EST, additional pressure on BTC could ensue.
The SOL/ETH ratio has plummeted by over 30% in the past month, impacted by the ETH ETF narrative which is weighing heavily on altcoins. The technical indicators have turned bearish as the ratio broke below an ascending triangle pattern, nearing the support level at 0.033.
In the DOGE market, funding rates have begun to turn negative, reaching levels last seen in October 2023. This shift reflects traders’ aversion to riskier assets amid the broader crypto market's low volatility. Open interest has dropped by 25%, indicating a decreased demand for DOGE tokens.
Meanwhile, MicroStrategy (MSTR), the largest corporate holder of BTC, has made another substantial acquisition of 11,931 BTC for $786 million. This follows the company's $800 million convertible note offering to institutional investors.
On Thursday, the S&P 500 surged to a new record high, propelled by an ongoing rally in Nvidia driven by artificial intelligence advancements. Fresh economic data released on the same day highlighted signs of a slowing economy, including higher-than-expected weekly jobless claims and weak housing starts and permits.
The excitement around AI has continued to elevate the market in recent weeks. Some market commentators have expressed concerns about the lack of market breadth outside the largest technology companies, which could pose future challenges, although this sentiment has not yet significantly impacted the record-breaking stocks.
The Bank of England decided to maintain interest rates at its June meeting, aligning with market expectations following the decline of U.K. inflation to the central bank’s 2% target. Traders are now anticipating a possible rate cut in August.
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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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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.
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