Bitcoin
BlackRock To Ammend Coinbase Prime Broker Agreement
BlackRock, the world’s largest asset manager, is seeking to amend its Bitcoin ETF (IBIT), which has been the top-performing ETF among its peers since launching on January 11.
Bitcoin ETFs continue to attract institutional demand, bringing Bitcoin exposure to Wall Street and expanding its reach beyond retail investors.
BlackRock Files Bitcoin ETF Amendment
In a filing with the US Securities and Exchange Commission (SEC) on September 16, BlackRock requested that Bitcoin withdrawals from Coinbase, which acts as custodian for the asset manager’s IBIT, be processed within 12 hours.
“Subject to confirmation of the foregoing required minimum balance, Coinbase Custody shall process a withdrawal of Digital Assets from the Custodial Account to a public blockchain address within 12 hours of obtaining an Instruction from Client or Client’s Authorized Representatives,” an excerpt in the filing read.
This request comes as investors raise concerns about Coinbase’s custodial practices for Bitcoin ETFs. Specifically, investors want Coinbase, as custodian, to provide on-chain proof of Bitcoin purchases for ETFs to ensure transparency.
The concerns have arisen due to Bitcoin’s stagnant price performance over the past three months, despite large inflows into Bitcoin ETFs. Some speculate that Coinbase might be using “paper BTC” or Bitcoin IOUs for ETF issuers, potentially contributing to the lackluster price movement.
Read more: How To Trade a Bitcoin ETF: A Step-by-Step Approach
Amidst the concerns, Coinbase CEO Brian Armstrong pushed back in a bold attempt to counter fear, uncertainty, and doubt (FUD).
“All ETF mints and burns we process are ultimately settled onchain. Institutional clients have trade financing and OTC options before trades are settled onchain. This is the norm for all our institutional clients. All funds are settled in our Prime vaults (onchain) within about one business day,” Armstrong wrote.
In hindsight, Tron founder Justin Sun first raised concerns by questioning Coinbase’s Bitcoin wrapper, cbBTC, and criticized the exchange for lacking proof of reserves, warning it could mark “dark days for Bitcoin.”
BlackRock’s recent move to amend its Bitcoin ETF aims to address these concerns. The modifications suggest the asset manager’s efforts to enhance operational frameworks while improving liquidity. ETF analyst Eric Balchunas also minimized the speculation.
“I get why these theories exist and people want to scapegoat the ETFs. Because it is too unthinkable that the native HODLers could be the sellers. But they are… All the ETFs and BlackRock have done is save BTC’s price from the abyss repeatedly,” Balchunas said.
Coinbase as a Potential Single Point Of Attack
Indeed, Bitcoin ETF inflows have been massive since the financial instrument hit markets on January 11. Dune data shows that BlackRock’s IBIT dominates the sector, holding over 38% of the market share and managing $22.5 billion in on-chain assets.
Read more: Bitcoin (BTC) Price Prediction 2024/2025/2030
Coinbase plays a dominant role in the crypto spot ETFs market, providing custody services for eight of 11 Bitcoin ETFs and eight of nine Ethereum ETFs. It also offers trading execution and market surveillance services.
Coinbase manages around 90% of the $37 billion in Bitcoin ETF assets, leading to concerns about its position as a potential single point of failure. Fox Business reporter Eleanor Terrett, among others, recently raised concern about this position of influence.
“It doesn’t bode well that nearly all crypto ETF issuers have the same custodian for all their BTC and ETH. This makes Coinbase a potential single point of failure and that’s scary,” Terrett wrote.
Beyond the latest concerns about possible IOUs to investors, the threat from North Korean hackers also positions Coinbase as a single point of attack should the bad actors target the custodian. Despite these concerns, the platform continues to play a critical role in institutional Bitcoin investment, operating a substantial portion of the US-based BTC spot trading market.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Bitcoin
Bitcoin Bull Saylor Hints at Expanding MicroStrategy’s Holdings
Michael Saylor, co-founder of MicroStrategy, has hinted at the possibility of additional Bitcoin purchases.
In a November 24 post on X (formerly Twitter), Saylor teased the company’s plans following its successful $3 billion fundraising round on November 22.
MicroStrategy’s $3 Billion Raise Could Fuel New Bitcoin Purchases
The Bitcoin bull mentioned that MicroStrategy’s portfolio tracker, SaylorTracker, “needs more green dots.” These markers symbolize the company’s each Bitcoin acquisition, fueling speculation about another significant purchase.
Saylor’s recent hints echo his previous two Sunday posts, which preceded announcements of large-scale Bitcoin acquisitions. During this period, MicroStrategy added approximately 80,000 BTC to its holdings, worth over $6 billion at the time.
Meanwhile, the recent $3 billion funding — raised through the issuance of convertible debt — could be instrumental in financing these new acquisitions. The convertible notes, sold privately to institutional investors under US securities laws, will mature on December 1, 2029. These notes carry a 55% premium and an implied strike price of $672 per share of MicroStrategy’s Class A common stock.
Market observers noted that this fundraiser aligns with MicroStrategy’s ambitious “21/21” initiative, which aims to raise $42 billion over three years through a mix of equity and fixed-income instruments.
The company remains the largest Bitcoin-holding public entity, with 331,200 BTC valued at over $32.7 billion. According to Saylor, MicroStrategy’s treasury operations have delivered a year-to-date Bitcoin yield of 41.8%, generating a net benefit of around 79,130 BTC, or roughly 246 BTC daily, without the operational costs associated with mining.
Additionally, this strategy has also bolstered MicroStrategy’s stock performance. MSTR shares have surged over 515% since the start of the year, making it one of the most actively traded stocks in the US.
Saylor emphasized that MicroStrategy’s operations are driven by its Bitcoin holdings, which are optimized through strategic financial tools like ATM offerings, enabling the company to reduce risk and volatility while enhancing shareholder value.
“MicroStrategy is powered by its Bitcoin treasury operations. We sell volatility through our ATM offerings, strip BTC risk, volatility, and performance from our fixed-income securities, and transfer that performance to our MSTR equity holders,” he stated.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Bitcoin
$100K Bitcoin Is Only The Beginning, VanEck Targets $180K
Recent gains in Bitcoin are owed in part to changes in the political environment, particularly in the US. Incoming US President Donald Trump is backing cryptocurrencies, sparking renewed market optimism among investors.
From reforms in regulatory structures to a proposal for a national Bitcoin reserve, the policies he enforces provide Bitcoin an exceptional outlet for growth in an increasingly open and friendly new landscape. These changes places the US in a strategic position as the world’s leader in crypto innovation while giving a fertile ground for Bitcoin to continue growing.
Crypto On The Rise
These possible changes have been well taken by market participants, who have seen the highest market dominance of BTC at 59%. A bill being worked out may permit state-chartered banks to mint stablecoins without seeking prior approval from the Federal Reserve, putting the US in a very commanding position in the race to dominate financial innovation. Furthermore, proposals to deregulate the energy industry may favor crypto mining, which will place the US in a better position in the global race for blockchain.
🧐 Bitcoin’s flirtation with $100K continues as crypto’s top market cap has now reached an ATH of $99,850. As its price continues to hit round numbers and fulfill limit sell orders, it is widely being perceived as only a matter of time. pic.twitter.com/Qb1LTznuij
— Santiment (@santimentfeed) November 22, 2024
Historic Rally: BTC Approaching $100K
Bitcoin is trading at nearly $99,850 and is on the verge of the long-awaited $100,000 milestone. Similar to other bull runs, including the one witnessed after the elections in 2020, when the price of Bitcoin nearly doubled in a matter of a few months, some believe institutional interest coupled with friendly economic conditions and increased on-chain activity are the drivers of this phenomenal appreciation of the price of Bitcoin.
Source: VanEck
According to VanEck’s latest report, Bitcoin still is in its early stages of the rally, and there is minimal technical resistance in its way. With investor enthusiasm building, growing calls for the alpha coin to be adopted as a strategic reserve, and with a supportive US government, this rally appears well-positioned to continue. Experts are optimistic that Bitcoin is going to push forward and hit new highs.
The Future Of Bitcoin: Cautious Optimism
Analysts, while acknowledging that momentum is strong, point out that the market may run too hot, and early signs in the development are a rise in funding rates and increased unrealized profits. However, even from this stage, long-term prospects appear bright given strong institutional demand, solid on-chain metrics, and supportive regulatory changes, according to the forecast of $180,000 by VanEck for Bitcoin in the current cycle.
While historical data may indicate the crypto asset’s growth is decelerating as the markets mature, the cryptocurrency still shows hopeful prospects in the near term. So far, this rally displays the confidence of investors and has incrementally acquired recognition regarding Bitcoin’s role in a changed financial sector.
Featured image from CNBC, chart from TradingView
Bitcoin
Bitcoin Whales Remain Determined, $3.96 Billion Worth Of BTC Gobbled Up In 96 Hours
All eyes are on Bitcoin, especially as many traders continue to anticipate a break above the $100,000 mark. This anticipation has cascaded into a spike in activity, especially among Bitcoin whales. Interestingly, Bitcoin whales are making bold statements amidst the anticipation, with on-chain data pointing to an accumulation of over 40,000 BTC in just 96 hours among this holder cohort.
This interesting accumulation coincides with the Bitcoin price reaching a peak of $99,645 in the last 24 hours, adding further momentum to the narrative of a possible historic price milestone.
Examining The Holding Patterns Of Bitcoin Whales
Bitcoin’s recent price dynamics have put the spotlight on Bitcoin whales. Ali Martinez, a well-known cryptocurrency analyst, drew attention to the remarkable activity of Bitcoin whales on social media platform X.
While highlighting Santiment data, Martinez revealed that Bitcoin whales have bought over 40,000 BTC worth approximately $3.96 billion in the past 96 hours. Notably, the Bitcoin whales referred to in this metric by Santiment consist of addresses holding between 100 and 1,000 BTC.
This aggressive accumulation comes at a critical juncture for Bitcoin, with prices flirting near the much-anticipated $100,000 mark. Such whale activity typically reduces the available supply of Bitcoin on the open market, which is expected to keep pushing up the Bitcoin price.
Despite the increase in whale accumulation, on-chain data from Glassnode suggests that long-term holders have upped their profit-taking in tandem. Particularly, over 128,000 BTC has been sold by long-term holders since early October.
However, this long-term holder profit taking has so far been offset by the demand from US Spot Bitcoin ETFs. These ETFs have acted as a counterbalance, absorbing nearly 90% of the Bitcoin sold by long-term holders.
A possible explanation is that long-term holders are exiting their self-custody of Bitcoin and are instead diverting their holdings into Spot Bitcoin ETFs in order to benefit from their regulatory clarity. According to data from SoSoValue, Spot Bitcoin ETFs in the US witnessed consecutive days of inflows throughout last week to bring the total inflow to $3.38 billion, which is the largest weekly inflow since their launch in January 2024.
What’s Next For Bitcoin Price?
Looking ahead, the Bitcoin price is definitely on its way to break above $100,000 in the next few days. However, it remains to be seen what happens after that. Crypto analyst Tony Severino has speculated that the Bitcoin price peak could double within a timeframe of two weeks to two months following the break above $100,000.This prediction is based off of the Bitcoin price performance after it first broke above the $10,000 price level in 2017.
On the other hand, veteran analyst Peter Brandt suggests there could be some sort of selling pressure among bulls once the Bitcoin price breaks above $100,000.
“What I had in mind here is the possibility that bulls will sell their BTC sub $100,00 thinking they will buy a correction that does not come, then turn bearish if Bitcoin goes to $120,000 believing price must come down,” he said.
Nevertheless, the current crypto market landscape is set in place for a continued Bitcoin price increase in the next few weeks and months.
Featured image from DALL-E, chart from TradingView
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