Dispatch #200: A $6 Trillion Crypto Inheritance
In this patch of your weekly Dispatch:
Whale Activity Spotted 🐳
New ETH ETF Date 🗓️
Solana’s Key Update 🗝️
The Big Idea
Passing Crypto from One Generation to Another
Let's get the market news out of the way first. Bitcoin (BTC) finds itself at a crucial stage in this cycle, after bouncing back from last week's low of $53,600, but remains in a downtrend from March’s high of $73,800. CryptoQuant analysts say the profit and loss index is near its 365-day moving average, hinting at a potential major correction. We’d argue Nexo’s product suite provides all the home your crypto needs.
But back to the Big Idea. If you haven’t noticed, good ol’ Dispatch has turned (out) 200 issues, which calls for a grand view. It’s big by default coming from one the world’s largest asset managers, VanEck. A recent projection by Head of Digital Assets Research, Matthew Sigel, suggests that cryptocurrencies could see an influx of over $6T from inheritances over the next 20 years. The prediction is based on findings from the 2024 Bank of America Private Bank Study, which estimates the amount of capital Gen X, millennials, and future generations could inherit from seniors and Baby Boomers by 2045.
Key Numbers to Watch:
$84 Trillion: Total inheritance expected to be passed down to future generations by 2045.
$6 Trillion: Potential amount that could flow into crypto from these inheritances over the next 20 years.
$300 Billion Annually: Required crypto investment from young investors over the next 20 years, assuming a 14% allocation of inherited wealth.
The study reveals that young, self-identified aggressive investors allocate 14% to crypto, with even moderate and conservative investors dedicating 12% and 17% respectively. Interestingly, the most conservative young investors hold the highest average exposure to crypto, a trend that starkly contrasts with their older counterparts, who have minimal crypto investments.
This is where this week’s Big Idea comes in – it’s all about digital asset adoption and usability. And judging by how far we’ve come in the first 200 issues of Dispatch, there’s a lot to look forward to in the next 200 and beyond. Stay tuned – we’re glad to have you with us!
The Latest In…
A Sunny Week for Bitcoin Whales
One more thing about that CryptoQuant prediction. Apparently, long-term Bitcoin holders have been adding to their stashes at the fastest monthly rate since April 2023. With a monthly growth rate of 6.3%, the increase in whale holdings suggests rising demand for Bitcoin. CryptoQuant analysts noted that while long-term holders realized profits above $70,000, they have experienced some losses and are now less willing to sell.
This accumulation could be an early sign of a Bitcoin price bottom and if we look at spot Bitcoin ETF performance, that could be true for now. ETFs saw a positive week with daily net inflows of $294.9M on July 8, $216.33M on July 9, and $147.37M on July 10. This marks four consecutive days of positive fund flows, accumulating $1.25B in traded value across 11 funds. Investors continue to navigate uncertainties, including Mt. Gox payouts and government-held Bitcoin sales – media analysts point out they aren’t as bad as previously thought.
The Latest In…
Vitalik Talks, Traders Wait
Ethereum co-founder Vitalik Buterin highlighted the need to strengthen the Ethereum blockchain in a packed room at the Ethereum Community Conference (EthCC). Highlighting Ethereum's strengths, such as its decentralized staking and international community, Buterin also pointed out weaknesses, including the complexity of solo staking and running a node. He proposed increasing the quorum threshold from 75% to 80% to mitigate 51%-attack risks and suggested simplifying the protocol to make it more robust. "If you want a robust ecosystem, it needs to be simple," he said.
Here’s an ETH update for all of you anticipating the ETF trading. Bloomberg's ETF analyst Eric Balchunas speculated a launch date around July 18, citing recent amendments as minimal changes. The SEC has instructed applicants to finalize their submissions soon, including fee declarations, before potential approval.
The Latest In…
A New Validator on the Block
Solana's new validator client, Firedancer, reached a significant milestone on its testnet as it successfully built its first accepted block."Firedancer's first accepted block on Solana testnet marks a crucial advancement," Cantelope Peel, a pseudonymous engineer involved in the project said..
Developed by Jump Crypto, Firedancer aims to enhance Solana's network speed and decentralization, adding diversity to the existing validator clients Solana Labs Validator and Jito-Solana. How’s that for price action? Anticipated for mainnet launch in Q4 2024, Firedancer has already sparked significant interest in SOL, buoyed by bullish sentiment and holding above the 200-day SMA at $143M, according to media.
The Week’s Most Interesting Data Story
Difference in the Similarities
The Bitcoin 2023-24 cycle has exhibited both similarities and differences compared to past cycles, say Glassnode analysts. During this period, the market underwent its most substantial correction, with prices declining by more than 26% from the peak. Despite this notable downturn, it's striking that this correction has been less severe than in previous cycles, indicating a resilient market structure and lower volatility as Bitcoin continues to evolve as an asset class.
Hot Topics
What the Community is Discussing:
These CryptoQuant guys may be onto something.
About those German Bitcoins…
Do we read between the lines here?
Ethereum’s ETFs – how long before trading?
Bitcoin’s charts – another bull run ahead?
Inflation vs. economy – so far so good?
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