Weekly Update: 17th of July
What happened between the 10th and 17th of July?
- The digital assets market surged as Trump's shooting boosted the odds of election victory, potentially introducing a pro-digital assets president and vice president. Read more
- The Securities and Exchange Commission has requested the final S-1 submissions from eight US asset managers for the Ether ETF launch, potentially introducing the financial instrument on the 23rd of July. Read more
- The SEC dropped its investigation into Hiro's Stacks Blockchain and stablecoin issuer Paxos, relieving legal pressure from the market which has experienced over two years of intensive legal battles. Read more
- The German government has offloaded its final Bitcoin holdings while collapsed Genesis Trading is on the verge of starting to repay its creditors $2 billion and Mt.Gox shows transactional activity. Read more
The digital assets market gains upward momentum
On July 13th, former President Donald Trump survived an assassination attempt while speaking at a rally, though one attendee lost their life. This tragic event has boosted his chances of winning the upcoming presidential election. On the online betting platform Polymarket, Trump’s odds of victory surged from 60% to 73%, and the digital asset market reacted positively to the prospect of his potential second term. As a supporter of digital assets, Trump’s influence caused Bitcoin to surge to around $65,000 before settling at $63,000. Additionally, Trump’s running mate, James David Vance, is also pro-digital assets and has criticized Gary Gensler as the "worst person" to regulate the crypto industry. If Trump is elected, the U.S. stance on the digital asset market may shift significantly.
The SEC requests final submissions for the Ether ETF launch
On the 15th of July, Bloomberg ETF analyst Eric Balchunas stated that the SEC had requested asset managers to submit their final S-1 filings by July 16. The biggest difference between the latest filings and this one is that these must include the fees issuer's plan. This potentially will enable these asset managers to launch their Ether ETFs on the 23rd of July. However, the SEC can still provide last-minute comments but the chances of this happening are small. Especially as some industry sources have stated that BlackRock, Franklin Templeton, and VanEck have reportedly received preliminary approval.
SEC drops investigation into digital assets firms
On July 11th, stablecoin issuer Paxos announced it had received a “formal termination notice” from the SEC, indicating no enforcement action would be taken against it regarding its stablecoin BUSD. In February 2023, Paxos had been issued a Wells Notice, suggesting that BUSD should be deemed a security. After a lengthy investigation, the SEC dropped the case, marking a significant victory for the industry. However, the question of whether the SEC views stablecoins as securities remains unresolved. Following this, the SEC also dropped its investigation into Bitcoin L2 Stacks and Builder Hiro. Overall, the SEC is seeing limited success in its legal battles within the digital asset sector.
The German government is done selling but other parties might start
In recent weeks, news emerged that several major parties, including the German government, would sell their Bitcoin holdings, causing high volatility and fear among investors. However, Germany has now sold all 50,000 of its Bitcoin, relieving some selling pressure.
On July 12th, it was reported that a wallet linked to the collapsed Genesis trading transferred over 12,600 Bitcoin, worth $719.9 million, to Coinbase over 30 days, suggesting potential liquidation. The wallet still holds around 33,350 Bitcoin, so selling pressure may continue. This was followed by news that Mt.Gox transferred over $2.9 billion worth of Bitcoin on July 16th, adding to investor concerns.
In other digital assets news
- Bitcoin transfer costs fall to 2020 lows as demand for block space and data volume drops. This is also illustrated by the significant transaction of Mt.Gox which transferred over $2.9 billion with less than $3 transaction costs.
- Larry Fink, CEO and co-founder of BlackRock, stated in a CNBC interview that he was initially wrong about Bitcoin and that it is “digital gold” and a “legitimate” financial instrument.
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