News

Bitcoin Institutional Adoption Accelerates as ETF Filings Show Investor Appetite
December 27, 2024 15:16

The dominant crypto narrative for 2024 has been institutional adoption. From the U.S. approval of spot bitcoin (BTC) exchange-traded funds to the burgeoning number of companies pledging to buy the largest cryptocurrency for their treasuries, crypto has entered, more than ever before, the mainstream conversation.

Bitcoin has increased almost 130% this year, breaking record highs on several occasions. It is currently hovering near the psychological threshold of $100,000. The ETFs approved in January have seen net inflows of $36 billion and amassed over 1 million BTC.

In addition, the number of publicly traded companies saying they're adding bitcoin to their corporate treasury is accelerating. The trend, which started with MicroStrategy (MSTR) in 2020, recently attracted KULR Technology (KULR), a maker of energy storage products for the space and defense industries. The Houston, Texas-based company said it bought 217.18 BTC for $21 million and is allocating up to 90% of the surplus to cash to BTC.

Now Bitwise Asset Management, which already has spot bitcoin and ether ETFs, has applied for an exchange-traded fund to track the shares of companies that hold at least 1,000 BTC in treasury. Other requirements for the fund, dubbed Bitwise Bitcoin Standard Corporations ETF, are a market capitalization of at least $100 million, a minimum average daily liquidity of at least $1 million and a public free float of less than 10%, according to the Dec. 26 filing.

A second Thursday filing was made by Strive Asset Management, co-founded by Vivek Ramaswamy, a politician in the administration of U.S. President-elect Donald Trump. The Bitcoin Bond ETF seeks exposure through derivative instruments such as MicroStrategy's convertible securities in an actively managed ETF. The bonds have been a massive success. The 0% coupon bond maturing in 2027 is priced at 150% above par and has outperformed bitcoin since inception.

"Since our inception, Strive has called out the long-term investment risks caused by the global fiat debt crisis, inflation, and geopolitical tensions," Strive CEO Matt Cole told CoinDesk. "We strongly believe there is no better long-term investment to hedge against these risks than thoughtful exposure to bitcoin."

"Strive's first of many planned bitcoin solutions will democratize access to bitcoin bonds, which are bonds issued by corporations to purchase bitcoin. We believe these bonds provide attractive risk-return exposure to bitcoin, yet they are not available to be purchased by most investors," he added.

Ethereum Co-founder Vitalik Buterin 'Adopts' Viral Hippo Moo Deng
December 27, 2024 13:47

Stalled bitcoin (BTC) and crypto prices may not be bringing festive cheer to traders, but some with money are trying to spread the goodwill around.

Ethereum co-founder Vitalik Buterin said he'd accepted an invitation to be the “adoptive father” of pygmy hippo Moo Deng when she grows up. He is also donating 10 million Thai baht ($300,000) to the Khao Kheow Open Zoo near Bangkok where the five-month-old lives, he said in a Thursday posting on X.

The donations, made in Moo Deng’s name, will be used to upgrade general zoo operations and create a dedicated pygmy hippo habitat within the premises.

Buterin said the donations came on the back of the “wonderful hospitality of Thailand” during November’s annual Ethereum developer conference, and were a “gesture of friendship and respect” to all of the country.

“What better way to do that than through a Christmas present to someone who is dear to all Thai people, Moo Deng, and who has become one of the most unexpected and important Thai celebrities on the world stage," Buterin said in a letter to the zoo.

Moo Deng, or bouncy pork in Thai, became a popular internet meme earlier this year after images of her went viral online. She has two siblings, brother Moo Toon (stewed pork) and sister Moo Waan (sweet pork).

A memecoin she inspired, MOODENG on Solana, went similarly viral and hit a market capitalization of above $600 million in November after bagging listings on influential exchanges such as Binance and Coinbase.

MOODENG was the first token themed on an animal other than a dog or cat to garner massive trading volumes and is considered by some to be the first Thai memecoin.

Token prices are down 60% from peak, however, as much of Moo Deng’s popularity remains focused within Thailand and neighboring markets.

Bitcoin Kimchi Premium Spikes as South Korea's Political Turmoil Escalates
December 27, 2024 12:22

South Koreans are paying a full 3% more to buy bitcoin (BTC) than their U.S. counterparts as they seek protection from the plummeting won, CryptoQuant data show.

Priced in won, the largest cryptocurrency is valued at 145,000,000 ($98,600) on the country's largest crypto exchange, Upbit. That compares with about $96,700 on Coinbase (COIN).

The move follows a vote by the South Korean parliament to impeach Han Duck-soo, the prime minister and acting president, just weeks after impeaching President Yoon Suk Yeol. The won slumped to a 15-year low against the dollar.

"This unfolding saga is fundamentally about election fraud and the erosion of trust in South Korea’s National Election Commission (NEC)," said Jeff Park, head of alpha strategies at investment manager Bitwise, in a post on X. "The use of impeachment as a political tool, combined with allegations of foreign election interference, underscores the fragility of democracy in the face of disinformation. This is not just a Korean story; it’s a warning for democracies worldwide."

UPDATE (Dec. 30, 08:32 UTC): Adds dropped word "to" in third paragraph.

Memecoin Degens Raise Millions for Rare Cancer Research After a Father’s Plea
December 27, 2024 07:56

A Pump.Fun memecoin zoomed from zero to an $80 million market capitalization on Thursday after a father’s plea for donations to a research study for his daughter’s rare brain cancer attracted swathes of crypto traders.

The MIRA token’s price has fallen 80% from a Thursday peak and trades at just over a cent as of Friday. But while late buyers are sitting on losses, the effort raised over $1 million for the cause.

In an X post on Thursday, Siqi Chen, founder of the Runway corporate finance planning application, said his daughter Mira was diagnosed with a type of brain tumor in September and that research and funding had “been lacking” because of the rarity of the condition.

His GoFundMe page has raised 80% of its $300,000 target as of Thursday, with all proceeds going directly to research efforts at the Hankinson Lab at the Univerity of Colorado.

Chen also posted his Ethereum wallet on the X thread, responding to user demand, adding his Solana and Bitcoin addresses when users asked for more options.

Then Pump.fun happened.

The Pump.fun platform lets anyone issue a token for less than $2 in capital, after which they choose the number of tokens, theme, and meme picture to accompany it. When the market capitalization of any token reaches $69,000, a portion of liquidity is deposited to the Solana-based exchange Raydium and burned.

A Pump.fun user created the MIRA token attached to a picture of Chen and his daughter, with no apparent objective except it being a token that can be traded like any other memecoin. The user’s profile shows MIRA was just one of the several tokens they created that day, with none of the others breaking a $6,000 market cap.

From there, though, things started to take off. X user @Waddles_eth bought 50% of the supply and sent all of it to Chen. Chen then boosted the memecoin on his X account.

That ensured virality for the token, sending the price from fractions of a penny to a peak of 8 cents early Thursday. The value of Chen’s token holdings soared from $400,000 to over $18 million. MIRA attracted a peak of $7 million in liquidity (in terms of both Solana’s SOL and the memecoin) as it became widely traded.

Trading volume topped $85 million in more than 130,000 transactions, making it the most popular smallcap in the past 24 hours.

“I have been on the internet for 30 years and have seen some shit, but this is by far the craziest day of my life,” Chen wrote on X as prices rocketed. “I will be liquidating $1,000 worth of $MIRA every 10 minutes, perpetually. If change this schedule, i commit to announcing it 24 hours in advance.”

“If you want to rug it to $0, go for it - at the end of the day we set out to raise $200K and we will end up with at least $1M towards rare disease research,” he wrote.

Community response to the event has been overwhelmingly positive, with several users pointing out how such memecoins can contribute to positive outcomes in the world.

Memecoins are largely based on virality, attention and hype. They are considered non-serious among professional investors, but have seen massive demand and preference in the past year compared with larger venture capital-backed crypto tokens — which are perceived as enriching already-rich investors at the expense of smaller retail traders.

MIRA has helped shift the conversation.

“I think memecoins are dumb and have no future and I don't touch them. But if I wanted to make a case for them I would now know where to start,” X user @JaEsf said. “This is beautiful and quite crazy that you can do that with crypto. EVM, Solana or any chain. This is why Crypto exist! Simplify movement of assets,” said @mbaril010, another X user.

Meanwhile, @waddles_eth, the user who originally sent half the token’s supply to Chen, said the overall outcome met their expectations.

“When I saw the story about Mira and her illness, I thought it would be good to buy and send supply to you with the hopes of getting the SOL community behind a good cause on Christmas,” they said in a now-viral X post. “I'm really glad that it worked out the way that it has and I hope that the money helps to find a cure both for Mira and anyone else with her condition.”

Crypto for good may finally become a thing in the new year.

CORRECTION (Dec. 27, 09:06 UTC): Corrects name of Chen's company to Runway. An earlier version of this story called it Runaway.

Why 2025 Will See the Comeback of the ICO
December 26, 2024 15:04

Regulatory overhaul in America and a thawing of crypto antagonism globally in 2025 will usher in a new generation of decentralized capital formation, which was first popularized in 2017 as “ICOs” (initial coin offerings).

During the 2010s, crypto hadn't settled on a productive use case for Bitcoin and altcoins until Ethereum smart contracts enabled early-stage teams to raise capital from supporters dispersed around the world. We saw Ethereum bootstrap a global decentralized computer which spawned DeFi, NFTs and various crypto primitives funded by less than $20 million raised from a global community.

Many other projects soon followed suit and we observed a new dynamic in which raising early-stage capital from a decentralized community almost always resulted in more value-add for the project and entrepreneurs than even the best, most well-intentioned venture capitalists could offer. With a decentralized investor group, entrepreneurs get free evangelists, beta testers and code contributors — i.e. free work that contributed to the project at hand. Also, the shorter liquidity time frame allowed for better risk-return profiles for early-stage investors.

Unfortunately, ICOs were slowly choked off and signalled as “not in compliance” with regulations that were never exactly spelled out. By 2020, they had slowed to a trickle and 88% of ICO tokens were trading at below issuance price.

Fast forward to 2025 and we can see the convergence of some important inputs that allow for the re-emergence of compelling investment opportunities, but with very different characteristics from ICO 1.0.

The ingredients of ICO 2.0

1. Updated regulatory stance

I predict that value accrual will be a fundamental part of the “why” of investing in tokens this time around. Entrepreneurs and investors in the space have matured and are ready to collectively admit that there is an expectation of profit with most tokens. In fact, one could argue that the obfuscation of how token holders would be compensated as a hand-wavey attempt to sidestep the Howey test was the primary problem the first time around.

KYC/AML will be focused on on-ramps and off-ramps such as exchanges and L2 bridges, and reasonably concentrate at the point of realization of gains back into fiat, which is the appropriate light touch that should satisfy reasonable regulators.

2. Market turnover

We are seeing the rapid decline of certain mid-market companies that could remake their business models by becoming community-led and decentralized. For example, mid-size media companies including newspapers and magazines are an obvious business model that could be greatly improved by the use of a token economy to drive citizen journalists towards greater professionalism.

3. Crypto's progression

In 2017 we had ICO-click-races on very rough UI/UX interfaces, pre-launch SAFT (Simple Agreement for Future Tokens) rounds going to a handful of VCs and years of waiting until a live network launch. No one should be surprised then that the majority of ICO projects died. The Darwinian nature of any emerging technology is such that most will perish but the few that survive go on to create great value (spoiler alert: >90% of AI projects are going away as well).

Crypto now has decent on-boarding and good user-facing apps, and most importantly, the community has shown an uncanny ability to publicly call out nonsense and root out bad actors far better than government oversight ever has. The light of open decentralized ledgers is a particularly strong disinfectant.

Implications and predictions

So what does all this mean for the crypto community?

This new wave of decentralized capital formation will dwarf the approximately $20 billion of capital allocated in ICO 1.0 in 2017 and 2018. Over the coming years, we will see hundreds of billions in total capital formation across DeFi, NFTs, RWAs and a plethora of other crypto primitives.

M&A activity will represent a significant component of on-chain capital formation activity. Whether it is traditional businesses getting serious about crypto and buying up lost ground, like the Stripe-Bridge deal or EVM L2s joining forces as they recognize that only a handful will survive to be significant, we will see billions of dollars worth of M&A activity in the coming year.

In addition, mid-market Web2 and legacy companies will seek to reinvent their business model now that they can use token-incentivization under less hostile circumstances. We are seeing companies in energy, media, art and cellular communications get serious about token-incentivization to turn their value chain into an open marketplace, as well as rapidly acquire customers and use cheap(er) labour.

I am also optimistic that regenerative financing, blending a capitalistic mandate and philanthropic mandate, will find its place. And I am very excited about how crypto can change paradigms in bridging reasonable returns on capital with social goals in more compelling ways than we've seen to date.

I predict that we will see a range of novel ways to choose ICO participants, whether as a reward to LPs, relying on reputation based on on-chain activity or via the usage of certain proofs. The byproduct of this is that we will see better balance between retail and institutional/VC investors.

Finally, as always with crypto, we will continue to see relentless innovation and new ideas that give rise to more early stage funding opportunities. Many exciting new teams clearly see that AI's natural transaction medium will be via crypto and are preparing accordingly. AI agents will bootstrap themselves with token-backed fundraising mechanisms that blend debt and equity principles.

Overall, I am optimistic that the crypto community has internalized the lessons learned along the stoic path of evolution to this point. As a litany of opportunities for capital allocation emerge next year, I encourage everyone in crypto to be vocal and open in highlighting due diligence red flags and bend the arc of this industry towards open access, fair launches and projects that are forthright in accruing value to token holders.

Fair launches are a superior path forward and we should all work towards more equitable and transparent fundraising practices. There are still many issues to resolve and there will be some spectacular failures as we move forward, but decentralized capital formation is crypto's original killer app, and it deserves to continue to evolve.

CoinDesk 20 Performance Update: HBAR Drops 8.2% as All Index Constituents Trade Lower
December 26, 2024 14:12

CoinDesk Indices presents its daily market update, highlighting the performance of leaders and laggards in the CoinDesk 20 Index.

The CoinDesk 20 is currently trading at 3333.82, down 5.0% (-176.57) since 4 pm ET on Wednesday.

None of the 20 assets are trading higher.

Leaders: ETH (-3.7%) and BTC (-3.7%).

Laggards: HBAR (-8.2%) and APT (-7.4%).

The CoinDesk 20 is a broad-based index traded on multiple platforms in several regions globally.

Animoca Brands Founder Yat Siu's X Account Exploited to Promote Fake Token
December 26, 2024 13:59

The X account of Animoca Brands co-founder Yat Siu, one of CoinDesk's Most Influential 2024, was compromised and used to promote a fictitious token, the company said in a post on the social media platform.

Animoca, a metaverse and gaming venture capital firm, posted a warning on its own account at 01:36 UTC on Thursday saying Siu's account had been compromised and the company was not introducing an official token or non-fungible token (NFT).

The exploit was probably perpetrated through a phishing email that purported to come from X and be related to copyright infringement, according to ZachXBT. The crypto exploit investigator posted on Tuesday about several similar attacks that took place over the past month, allowing the perpetrators to get away with about $500,000 at the time.

The false post from Siu's account promoted a token named MOCA on the Solana blockchain, according to a screenshot posted by ZachXBT.

Moca Foundation, a "community-owned foundation that aims to supercharge Mocaverse’s network effects," has its own Moca Coin (MOCA), which it describes as an "omni-chain network token." Mocaverse is an account and ID management system in which both Animoca and Siu personally have a stake,

According to a post from Mocaverse, control of Siu's account has been secured by X, which is in the process of verifying ownership. Related accounts remain untouched.

"There is no compromise on Animoca Brands, Moca Network or MOCA Foundation official handles, and there are strict security measures in place," it said.

Whoever is behind the fake MOCA token is active on memecoin-creation platform Pump.fun and has also created a number of NFT collections over the past two weeks, on-chain data show. The wallet holds about $67,000 worth of the USDC stablecoin, although it is unclear whether this is the direct proceeds of any phishing scams.

Oliver Knight contributed reporting to this story.

UPDATE (Dec. 26, 14:52 UTC): Adds wallet data from Solscan in last paragraph.

Bitcoin Returns to $95K as Christmas Rally Snuffed Out
December 26, 2024 13:43

With much of the globe celebrating Christmas, bitcoin (BTC) quietly appeared set to retake the $100,000 level after having fallen to below $93,000 just ahead of the holiday.

The rally, however, stalled at just above $99,800 as Asia opened for business on Thursday morning and declined rapidly to roughly $95,000 only a few hours later.

Bitcoin at press time was trading at $95,300, down 3.1% over the past 24 hours.

The broader CoinDesk 20 Index was lower by 4.2% over the same time frame, with ETH, SOL, XRP, ADA and AVAX among cryptos in that gauge sporting 4%-7% losses.

U.S. markets are open on Thursday, and stock index futures are pointing to modest early losses; gold and oil are marginally in the green.

Crypto's price action over the past 48 hours is surely on very low volume and bitcoin has still more than doubled year-to-date, but perhaps overlooked in declines over the past week is that the tailwind of lower interest rates might have become a headwind.

The 10-year Treasury yield continued to drift upward early Thursday, now at 4.63% and within a few basis points of its 2024 high. The yield is now ahead by nearly 100 basis points since the Federal Reserve slashed benchmark short-term rates by 50 basis points in September.

Macro researcher Jim Bianco noted that the swift move upward in long-term rates following a Fed rate cut is nearly unprecedented in modern monetary history. "The bond market will keep selling (higher yields) the more the Fed talks about rate cuts in 2025," said Bianco. "If the Fed does not back off the rate-cutting talk, bond yields will go as high as needed to start breaking things, to break inflation."

Six Bitcoin Mutual Funds to Debut in Israel Next Week: Report
December 25, 2024 11:45

Six mutual funds tracking the price of bitcoin (BTC) will debut in Israel next week after the Israel Securities Authority (ISA) granted permission for the products, Calcalist reported on Wednesday.

All six will start operations on the same day, Dec. 31, a condition imposed by the regulator, Calcalist said. Final approval for the funds was granted last week.

The funds will be offered by Migdal Capital Markets, More, Ayalon, Phoenix Investment, Meitav and IBI, with management fees ranging from as high as 1.5% to 0.25%. One of the funds will be actively managed, trying to beat bitcon's performance. They will initially transact just once a day, though future products will be able to trade continuously, Globes said in a Tuesday report, citing market sources.

The ISA's approval comes almost a year after the U.S. Securities and Exchange Commission (SEC) greenlighted spot bitcoin exchange-traded funds (ETFs) in the world's largest economy, during which the world's largest cryptocurrency has more than doubled to trade near a record high. The U.S. funds have gathered a net $35.6 billion of investor cash.

"The investment houses have been pleading for more than a year for ETFs to be approved and started sending prospectuses for bitcoin funds in the middle of the year. But the regulator marches to its own tune. It has to check the details," an unidentified senior executive at an investment house told Calcalist.

Floki on Course for Europe ETP as DAO Floats Proposal to Provide Early Liquidity
December 25, 2024 11:00

Meme-turned-utility project Floki is working with an unidentified asset manager to develop an exchange-traded product (ETP) tracking its FLOKI token that could be available to investors in Europe early in the new year, one of the developers told CoinDesk.

If approved, FLOKI would be the only meme token other than dogecoin (DOGE) with an institutional product in Europe.

“We've been actively working with a respected Asset Manager and an ETP Issuer to launch a Floki ETP (Exchange-Traded Product) for quite a while now, and after months of due diligence and painstaking effort, we've been told that the Floki ETP is on track to go live in early Q1, 2025,” lead developer B told CoinDesk in a Telegram message on Wednesday.

The developers as seeking approval from the Floki DAO community to provide early liquidity to the product when it goes live. The vote runs for 48 hours and will end at 11:00 UTC on Dec. 27.

They are seeking approval to allocate part of the FLOKI required for the ETP from a treasury wallet that holds 16 billion tokens, worth just over $2.8 million at current prices. Tokens in that wallet were purchased from the open market over three years after the passage of another community vote.

If the proposal is approved, the FLOKI tokens would provide liquidity for the ETP while remaining Floki's property and could be withdrawn if there is enough third-party liquidity in the ETP.

“The Floki ETP is currently in an advanced stage and will become tradable on the SIX Swiss Exchange, the largest stock exchange in Switzerland and the third-largest in Europe,” B said. “When it goes live, the Floki ETP will allow institutional investors, regulated entities and retail investors to get exposure to FLOKI in a regulated way.”

B said the team could not disclose further specifics about the ETP due to non-disclosure agreements, such as opening prices, fund structure and institutional partners.

FLOKI is up 1.1% in the past 24 hours, in line with the broader crypto market.