Dispatch #203: The Bitcoin Validation

Aug 02•5 min read

In this patch of your weekly Dispatch:

  • ETH’s Quest on Wall St. 🏦
  • August’s $1B Unlocks 🔐
  • Cars Go On-chain 🚘

The Big Idea

The Biggest Recognition for Bitcoin?

It’s been more than a few issues of Dispatch that we’ve firmly stated our belief in Bitcoin as the most innovative of assets that effectively store value. That’s why we headlined the Bitcoin emoji proposal, while the Nexo Card continues to do its thing – help you spend without selling your BTC. It’s not a bad time to do so, media report.

That recognition of Bitcoin’s qualities starts to carry a lot more weight when it comes from one of the world’s biggest banks, complemented by legislation, drafted in the world’s most powerful economy. Here’s this week’s Big Idea and the big acknowledgments that sparked it:

  • Goldman Sachs CEO David Solomon said on TV that Bitcoin “could be a store of value,” likening it to gold. The head of the world's seventh biggest bank described Bitcoin as a “speculative investment,” but praised blockchain technology as “super interesting.” Solomon highlighted efficiency gains, noting that a €100M digital bond settled in just 60 seconds on Goldman's private blockchain.

  • US Senator Cynthia Lummis (R-WY) introduced the “BITCOIN Act” on July 31, proposing the creation of a Strategic Bitcoin Reserve. The Act aims to boost the US dollar and reduce national debt by acquiring up to 1 million Bitcoins, about 5% of the total supply. Lummis emphasized that this could position the US as a leader in financial innovation.

All the bullishness quoted above had Bitcoin almost touching $70,000, but the wait for the Fed’s first cut corrected it back to $65,000. So perhaps carrying over patience from last week’s Big Idea remains a good idea still. And this week’s? Bitcoin got all the validation – if it ever needed more. 

The Latest In…

ETH ETFs: The First Turn-around

Ethereum ETFs recorded their first positive inflows since launch, totaling $33.6M midweek on 30 July. The shift followed a period of heavy initial outflows, including $547M million since July 24. Grayscale’s ETHE, which holds approximately $6.6B in ETH (about 60% of the total $9 billion in ETH ETFs), saw its smallest daily outflow of $120.3M, contributing to the turnaround.

Looking at the broader landscape, projections for Ethereum ETFs remain optimistic. Katalin Tischhauser, Head of Investment Research at Sygnum Bank, predicts that spot Ether ETFs could amass between $5B and $10B in assets under management within their first year. Tischhauser suggests that while Ethereum's adoption may lag behind Bitcoin's, its growing use case and advantages as a smart contract platform make it an attractive investment. As the Ethereum ETF market gains momentum, Tischhauser also forecasts that substantial inflows could drive Ether’s price to $6,000.

The Latest In…

Token Unlocks This August

Several major cryptocurrency projects, supported on Nexo, are set to unlock significant portions of their tokens this month. Here’s a breakdown of the key unlocks to watch:

  • Optimism (OP) – 31.3M tokens ($55M) on July 31 (2.8% of supply).
  • dYdX (DYDX) – 8.33M tokens ($11M) on August 1 (3.65% of supply).
  • Sui (SUI) – 64M tokens ($50M) on August 1 (2.56% of supply).
  • ImmutableX (IMX) – 32.5M tokens ($49M) on August 9 (2.11% of supply).
  • Aptos (APT) – 11.31M tokens ($80M) on August 12 (2.41% of supply).
  • Avalanche (AVAX) – 9.5M tokens ($268M) on August 20 (2.42% of supply).

The Latest In…

The Big Deals on Stablecoins

The two largest stablecoin issuers, Tether and Circle, continue to dominate the market with impressive valuations and financial performance.

  • Tether (USDT): The USDT issuer reported a record net profit of $5.2B for the first half of 2024. The firm has a market capitalization of nearly $115B, driven by its yield-bearing investments and reserves. 

  • Circle (USDC): Circle, the issuer of the second-largest stablecoin , is preparing for an initial public offering (IPO). The company's privately held stock is trading in the secondary market at a valuation between $5B to $5.25B. In 2022, Circle's valuation peaked at around $9B.

The Latest In…

Blockchain Usage Par Excellence

In a prime example of blockchain technology usability, the California Department of Motor Vehicles (DMV) has digitized 42 million car titles on the Avalanche blockchain, marking a revolutionary step in public service modernization. This initiative by Oxhead Alpha enables Californians to manage and transfer vehicle titles digitally via a mobile app.

By leveraging blockchain, the DMV enhances efficiency, reduces trips to the DMV and post office, and combats lien fraud with an immutable ledger. This move aligns with Governor Gavin Newsom's vision and demonstrates how blockchain can transform public services, setting a new benchmark for government tech innovation.

The Week’s Most Interesting Data Story

It’s Not About the Price (Only)

The launch of spot Ethereum ETFs has dramatically boosted trading activity for ETH. Last week saw a surge in trading volume for Ethereum investment funds, hitting $14.8B – the highest since May. New Ethereum ETFs alone attracted $2.2B in assets, with trading volume for Ethereum-tracking products soaring by 542%, underscoring the significant impact of these ETFs on market engagement and open interest, pictured above. We also launched Futures trading on the Nexo Web Platform. Just saying…

Hot Topics

What the Community is Discussing:

So now it’s a soft spot?

Can’t leave a good Bitcoin chart away!

It’s more volatile than Bitcoin and Ether now!

What to Watch for Next Week:

  • What’s ahead for Solana in 2024?

  • How profitable are Bitcoin miners?

  • Is global inflation under control?

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