News Desk

SEC Approves Grayscale’s New Bitcoin Mini Trust ETF for NYSE Listing, Introducing Lower Fees and Tax Advantages for Shareholder

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The United States Securities and Exchange Commission (SEC) has approved Grayscale’s latest spot Bitcoin exchange-traded fund (ETF), named the Grayscale Bitcoin Mini Trust (BTC), for listing on the New York Stock Exchange’s (NYSE) Arca electronic trading platform.

This development was confirmed in a filing dated July 26.

This approval represents a significant achievement for Grayscale, which recently announced plans to partially spin off its primary Bitcoin fund, the Grayscale Bitcoin Trust (GBTC), into the new Mini Trust.

A Grayscale spokesperson expressed excitement over the SEC’s approval, stating, “Grayscale is excited to share that the [SEC] has approved NYES Arca’s Form 19b-4 application to list and trade shares of Grayscale Bitcoin Mini Trust (proposed ticker: BTC).”

The company awaits the registration statement’s effectiveness, which will enable the Mini Trust to operate as a U.S. spot Bitcoin ETP, alongside GBTC and other funds.

The Mini Trust offers a notably lower management fee of 0.15%, significantly less than the 1.5% annual fee charged by the GBTC fund.

On July 31, Grayscale will allocate 10% of the spot Bitcoin held by GTBC to the Mini Trust.

Current GBTC shareholders will receive shares in the Mini Trust proportional to their existing GBTC shares.

READ MORE: WazirX Suffers $235 Million Hack, Raising Concerns Over Cryptocurrency Security in India

This transition ensures that GBTC holders will maintain the same amount of spot BTC, but distributed across two separate funds.

Earlier this month, on July 8, Grayscale announced a similar initiative with its Grayscale Ethereum Trust (ETHE), where existing shareholders were granted shares in the newly established Grayscale Ethereum Mini Trust (ETH).

Both GBTC and ETHE funds are among the oldest spot Bitcoin and Ethereum funds in the U.S., having launched in 2013 and 2017, respectively.

The GBTC fund alone manages over $17 billion in assets.

An insider mentioned that this distribution method provides existing shareholders with a tax-advantaged way of transitioning from the legacy fund to the new ETF, potentially offering more flexibility and benefits.


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RFK Jr. Proposes Bitcoin-Backed Economic Plan, Pledges Executive Orders to Boost US Dominance and Financial Stability

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At the Bitcoin 2024 conference on July 26, Independent presidential candidate Robert F. Kennedy Jr. highlighted Bitcoin’s potential to strengthen the US economy and improve American life.

He outlined his plans to sign several executive orders immediately upon taking office.

One key order would direct the US Justice Department and US Marshals to transfer the government’s 204,000 Bitcoin holdings to the Federal Reserve, designating them as a “strategic asset.”

Additionally, Kennedy proposed that the Treasury Department purchase 500 Bitcoin daily until the reserve accumulates at least four million BTC.

He asserted that this move would establish the United States as a dominant global power, with the value of its Bitcoin reserve potentially reaching “hundreds of trillions of dollars.”

Kennedy also plans to make significant changes to tax regulations concerning Bitcoin. He would instruct the Internal Revenue Service (IRS) to classify all Bitcoin-to-dollar transactions as nonreportable and nontaxable.

Moreover, he aims to make Bitcoin eligible for exchange into real property under the 1031 Exchange program, which is designed to promote real estate investments.

READ MORE: BlackRock’s Bitcoin ETF Sees Continued Inflows Despite Decline in Positive Market Sentiment

Emphasizing the importance of “transactional freedom,” Kennedy argued that Bitcoin could help restore the US economy to its state before the dollar was detached from the gold standard during President Nixon’s era.

He stated, “Fiat currency was invented to fund war. […] If the world was on a BTC standard, there would be no more war because you can’t print Bitcoin.”

Kennedy also expressed his intention to appoint Space Force Major Jason Lowery, known for his work on Bitcoin as a “cyber-defense system,” as a national security adviser.

Lowery has described Bitcoin as a form of “soft power projection” that can protect online identities in cyberspace.

To strengthen the dollar, Kennedy would back US Treasury bills, notes, and bonds with hard assets, including precious metals and Bitcoin, aiming to curb inflation and establish financial stability.

He predicted that these measures would lead to global support for a decentralized currency backed by the United States.


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WazirX Introduces Socialized Loss Strategy to Recover $230 Million After Cyberattack

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Indian crypto exchange WazirX has unveiled a plan to recover user funds following a significant cyberattack that resulted in the theft of around $230 million.

The hack, affecting 45% of user funds, has led WazirX to implement a socialized loss strategy to minimize disruption and ensure platform stability.

To manage the loss, WazirX has introduced a 55/45 approach.

This means that users can immediately access 55% of their assets, while the remaining 45% will be held in Tether-equivalent tokens.

This method aims to distribute the impact evenly among users, avoiding the typical uncertainty and prolonged recovery periods seen in similar incidents.

By doing so, WazirX seeks to offer a more expedited and flexible resolution.

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Users are provided with two options for handling their remaining assets, each with distinct advantages.

Detailed instructions will be sent to registered users via email, with a deadline of August 3, 2024, at 7:00 am IST for responses.

The outcome of this user poll, though not legally binding, along with ongoing investigations and the exchange’s liquidity, will shape the final decision.

In an effort to ensure fair treatment, WazirX plans to create a diversified portfolio for the unlocked 55% of users’ assets.

This portfolio will include a range of crypto assets, replacing any affected tokens with unaffected ones to maintain balance.

The valuation of these unlocked assets will be based on average prices from CoinMarketCap and selected global exchanges as of July 21, 2024, at 8:30 pm IST.

Operations are expected to resume after users have completed the poll to select their preferred asset management option.

The breach at WazirX, resulting in approximately $235 million in losses, ranks as the second-largest hack of a centralized exchange in recent times, following a $305 million loss from the DMM exploit on May 31.

The exchange is committed to recovering from this setback and maintaining trust with its user base through transparent and equitable measures.


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Samson Mow Proposes Bold Bitcoin Strategies for Trump Ahead of Nashville Conference

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Samson Mow, CEO of JAN3 and a prominent Bitcoin advocate, has proposed six transformative ideas for former President Donald Trump to consider before his upcoming speech at the Nashville Bitcoin Conference on January 27.

Mow’s proposals, shared on the social platform X, aim to integrate Bitcoin (BTC) into the US economy, positioning it as a key component of the nation’s financial strategy.

Mow’s first proposal suggests converting US debt to satoshis, the smallest unit of Bitcoin.

By pegging $1 to 1 satoshi, Mow believes this innovative approach could leverage Bitcoin’s decentralized nature and scarcity to stabilize and potentially reduce the national debt.

His second idea involves establishing a Lunar Bitcoin mining facility, tapping into the moon’s natural resources and low gravity to reduce costs and increase mining efficiency.

This project could place the US at the forefront of space-based cryptocurrency mining, encouraging international competition and innovation in the space industry.

In line with the libertarian ethos often associated with Bitcoin, Mow’s third proposal calls for the abolition of the Federal Reserve.

This radical move would shift the US toward a more decentralized financial system, potentially positioning Bitcoin as a central pillar.

READ MORE: Terra’s Bankruptcy Court Order Spurs Major Reopening of Shuttle Bridge, Destruction of 150 Million LUNA Tokens

Mow’s fourth proposal involves inflation reparations using Bitcoin.

He suggests compensating citizens for the loss of purchasing power due to inflation with Bitcoin, a currency often seen as a hedge against inflation because of its limited supply.

This approach could provide a more stable and reliable form of compensation.

Additionally, Mow proposes making Bitcoin transactions and holdings untaxable to encourage widespread adoption and integration into the mainstream economy.

This could significantly boost Bitcoin’s role in daily transactions and long-term investments.

Finally, Mow suggests creating a strategic Bitcoin reserve, akin to a proposal by Independent presidential candidate Robert F. Kennedy Jr., to transfer the US government’s 204,000 Bitcoin holdings to the Federal Reserve as a “strategic asset.”

Trump’s upcoming speech at the Nashville Bitcoin Conference is highly anticipated in the cryptocurrency community, as these proposals highlight potential avenues for integrating Bitcoin into the US economy.


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Premature Launch of Ether ETFs May Impact Bitcoin Prices, Analyst Warns

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A Bitcoin analyst suggests that the introduction of spot Ethereum exchange-traded funds (ETFs) may have been premature and could negatively impact Bitcoin’s price if no new capital enters the market.

Charles Edwards, founder of Capriole Investments, told Cointelegraph, “It would have been better to only have the BTC ETF in 2024.”

He believes the launch of Ether ETFs might divert investor attention from Bitcoin.

Edwards points out that institutional investors holding Bitcoin ETFs may feel compelled to diversify by purchasing Ether ETFs.

“Current BTC ETF holders at the institutional level likely think they should diversify a little and buy the ETH ETF. Without new flows into the whole market, this creates sell pressure on Bitcoin,” he explained.

Since the debut of spot Bitcoin ETFs on January 11, approximately $17.53 billion has flowed into 11 different products, according to Farside Investors.

Meanwhile, Bitcoin’s market dominance has stayed relatively steady, increasing by 0.07% over the past 24 hours, based on TradingView data.

The launch of Ether ETFs on July 23 coincided with a net outflow of $78 million from spot Bitcoin ETFs, though the subsequent two days saw inflows of $44.5 million and $31.1 million.

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Edwards remains cautious, stating that the Ether ETF launch in a “somewhat weak market” has led to uncertainty regarding capital allocation.

He foresees “no strong catalysts in the near term for large price appreciation.”

As of the publication, Ether’s price has dropped 9.2% since the launch, trading at $3,178, while its value against Bitcoin has declined by 10.4%.

Futures traders are not expecting a quick recovery, with $1.32 billion in short positions at risk if Ether’s price rises to $3,500, according to CoinGlass.

Some analysts, however, believe this situation could change soon.

Julio Moreno from CryptoQuant commented that the start of trading for spot ETH ETFs appears to have been a “sell-the-news event,” and similar market reactions were observed with Bitcoin.

Michael van de Pope from MN Trading and crypto commentator Croissant also noted that Ethereum’s trajectory mirrors Bitcoin’s post-ETF approval, suggesting a potential market reversal once outflows stabilize.

Crypto trader Kaleo mentioned the possibility of one final dip before a significant price increase.


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Tyler Winklevoss Calls for SEC Leadership Clarity Ahead of U.S. Election, Criticizes Biden Administration’s Crypto Stance

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Gemini co-founder Tyler Winklevoss has urged the U.S. government to clarify the leadership of the securities watchdog before the upcoming election.

In a post on X (formerly Twitter) on July 26, Winklevoss expressed that voters should know who the next chair of the Securities and Exchange Commission (SEC) will be.

He revealed that he and his brother Cameron Winklevoss, also a co-founder of Gemini, were recently disinvited from a White House event after endorsing Donald Trump.

Winklevoss criticized the Biden administration’s approach to the cryptocurrency sector, claiming it missed an opportunity to rebuild the relationship with the industry.

He emphasized the need for clarity and predictability in the regulatory environment, stating, “No more guessing.

“No more hoping. No more surprises. Our industry should not tolerate any possibility of a repeat of the last 4 years.”

He argued that demanding action from the administration before November is a non-partisan stance that the entire crypto industry should support.

Gary Gensler, the current SEC chair since February 2021, has been a contentious figure in the crypto world due to his perceived anti-crypto positions.

READ MORE: Terra’s Bankruptcy Court Order Spurs Major Reopening of Shuttle Bridge, Destruction of 150 Million LUNA Tokens

His term is set to end in June 2026.

In addition, Winklevoss expressed his wish that politicians would refrain from attending Bitcoin and crypto conferences.

He argued that the mainstream adoption of crypto should reach a point where its legality or acceptance is no longer debated, likening it to discussions about the legality of email or the Internet.

This statement was made during the Bitcoin 2024 conference in Nashville, Tennessee, which saw political figures like independent presidential candidate Robert F. Kennedy Jr., and Senators Cynthia Lummis and Tim Scott, in attendance.

Kennedy spoke about Bitcoin’s potential to enhance the U.S. economy and pledged to issue executive orders to support cryptocurrency on his first day in office.

Former President Donald Trump was scheduled to headline the event on July 27.


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Federal Reserve Ends Enforcement Actions Against Silvergate Bank Amid Ongoing Legal Challenges

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The Federal Reserve Board announced on July 26 that it had lifted all enforcement actions against Silvergate Bank and its parent company, Silvergate Capital Corporation.

The decision followed the bank’s successful winding down of operations, which included reimbursing customers and ceasing its activities as a financial institution.

While the Federal Reserve Board responded to Cointelegraph’s request for additional information, it declined to comment specifically on the matter.

Silvergate Bank’s collapse in March 2023 marked a significant event in the financial sector.

A month prior, the bank’s stock had become the second-most shorted on Wall Street, with 72% of shares borrowed for short selling.

This intense market scrutiny was compounded by Silvergate’s delay in filing its 10-K form in early March, an annual financial report required by U.S. law.

The delayed filing led to a 31% drop in Silvergate’s stock value.

On March 8, 2023, Silvergate officially collapsed, citing financial shortfalls due to the fallout from FTX’s collapse and the subsequent withdrawal of funds by major clients.

In response, the Federal Reserve Board oversaw the bank’s self-liquidation plan to ensure that customer reimbursements were maximized.

READ MORE: BlackRock’s Bitcoin ETF Sees Continued Inflows Despite Decline in Positive Market Sentiment

Despite this oversight, not all affected parties were satisfied, leading to lawsuits against the defunct bank.

Amid the liquidation process and mounting legal challenges, CEO Alan Lane and other top executives left the company in August 2023.

Despite the end of the Federal Reserve’s enforcement actions, Silvergate’s legal challenges persist.

In March 2024, a federal court judge allowed a class-action lawsuit to proceed, alleging that Silvergate facilitated the FTX fraud.

Additionally, in July 2024, the Securities and Exchange Commission filed a lawsuit against Silvergate Capital Corporation, accusing it of complicity in the same fraud.

These ongoing legal issues suggest that Silvergate has not yet fully emerged from its difficulties.


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Grayscale Ethereum Trust ETF Sees $1.5 Billion Outflow Amid Volatile Market Trends

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Outflows from the Grayscale Ethereum Trust ETF (ETHE) have surpassed $1.5 billion, with a notable single-day net outflow of $356 million on July 26.

This day marked significant volatility for spot Ether exchange-traded funds (ETFs), which experienced total net outflows of $163 million, according to SoSo Value.

Since the launch of spot Ether ETFs in the United States on July 23, Grayscale’s Ethereum Trust ETF has seen substantial investor withdrawals totaling over $1.5 billion.

In contrast, Grayscale’s Ethereum Mini Trust ETF (ETH) has experienced a different trend. On July 26, it recorded a net inflow of $44.9 million, bringing its total net inflows to $164 million since its inception.

BlackRock’s iShares Ethereum Trust ETF (ETHA) has garnered the most investor interest among these ETFs. On July 26, ETHA reported a net inflow of $87.2 million, boosting its total net inflows to $442 million.

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Currently, the total net asset value of spot Ether ETFs stands at $9.2 billion.

The ETF net asset ratio, which indicates the market value of ETFs relative to Ethereum’s total market value, is at 2.36%.

Despite these figures, the historical cumulative net outflow for spot Ether ETFs has reached $341 million.

The introduction of these Ethereum ETFs follows the U.S. Securities and Exchange Commission’s approval in May, with eight investment firms launching nine new funds that track the cryptocurrency’s spot price on July 23.


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BlackRock’s Bitcoin ETF Sees Continued Inflows Despite Decline in Positive Market Sentiment

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BlackRock’s spot Bitcoin exchange-traded fund (ETF) has continued to attract millions from investors since last Monday, despite a notable decrease in positive Bitcoin commentary.

The iShares Bitcoin Trust (IBIT), issued by BlackRock, recorded an additional $107 million in inflows on July 18, marking the ninth consecutive day of inflows, according to Thomas Fahrer, co-founder of crypto data platform Apollo.

Seven of those nine days saw inflows exceeding $100 million, an achievement rarely seen in the ETF industry.

However, crypto traders are displaying less optimism.

Positive Bitcoin commentary on social media has declined compared to four months ago, and traders are increasingly taking short positions on the asset, as reported by blockchain market intelligence firm Santiment.

“Positive commentary toward Bitcoin has plummeted despite the mid-sized crypto market bounce this week.

READ MORE: Worldcoin Faces Allegations of Price Manipulation Amid Token Unlock Delay

“Many traders, particularly on @binance, are opening shorts with the expectation of BTC dropping again.”

Santiment’s chart indicates that positive Bitcoin comments on social media are about a third of what they were four months ago.

Santiment typically measures social sentiment from platforms such as Reddit, X, 4chan, and BitcoinTalk.

Interestingly, Santiment noted a surge in “buy the dip” mentions for Bitcoin on these platforms at the start of the month when Bitcoin began approaching its near-five-month low of $53,600 on July 5.

Despite the decline in positive Bitcoin mentions, the Crypto Fear & Greed Index currently estimates market sentiment to be in the “Greed” zone, with a score of 60 out of 100.

This score represents a strong recovery from the “Extreme Fear” zone, which was reached on July 12 with a score of 25 out of 100, the lowest since January 2023.

Bitcoin is currently priced at $63,540, down 1.5% over the last 24 hours but up 11.5% over the past two weeks.


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WazirX Suffers $235 Million Hack, Raising Concerns Over Cryptocurrency Security in India

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The massive $235 million hack on the Indian cryptocurrency exchange WazirX on July 18 has raised serious concerns about exchange security and the future of cryptocurrency in India.

The attack was detected by Web3 security firm Cyvers, which noted “multiple suspicious transactions” involving WazirX’s “Safe Multisig” wallet on Ethereum.

The hacker moved $234.9 million worth of funds to a new address, using assets from cryptocurrency mixer Tornado Cash to fund each transaction.

The stolen funds included a variety of cryptocurrencies such as Tether, Pepe, and Gala.

The attacker quickly converted these assets into Ether to obscure the trail of stolen funds.

WazirX’s wallet also held approximately $100 million in Shiba Inu, $52 million in ETH, $11 million in Polygon, and smaller amounts of other tokens.

In response, WazirX suspended withdrawals of cryptocurrencies and Indian rupees and announced it was “actively investigating the incident.”

Rajagopal Menon, a spokesperson for WazirX, stated: “We can’t speak to the press right now. You can get updates from our Twitter handle.”

The hack could significantly impact India’s cryptocurrency sector, which has thrived despite government pressure.

Utkarsh Tiwari, chief strategy officer for KoinBX, commented that such a security breach would cause concern among multiple stakeholders, including retail investors and other exchanges.

He added that under India’s G20 presidency, there has been a push for comprehensive regulations for global Virtual Assets Service Providers, prioritizing investor protection.

India’s crypto industry is also hoping for relief from stringent crypto tax regulations.

READ MORE: Experts Skeptical of U.S. Bitcoin Strategic Reserve Amid Speculation of Potential Trump Announcement

Finance Minister Nirmala Sitharaman will present the Union Budget on July 23, and the sector is optimistic about favorable changes.

Since 2022, India has imposed a 30% capital gains tax on digital assets and a 1% tax deducted at source (TDS) on crypto transactions. Sumit Gupta, CEO of CoinDCX, has advocated for reducing the TDS rate to 0.01%.

Meir Dolev, CTO of Cyvers, explained that WazirX uses a multisig wallet requiring four signatures for transactions, with Liminal providing the last signature.

The attacker used two addresses to initiate and receive transactions, funding his wallet via Tornado Cash.

The attacker deployed a malicious contract to change the implementation of WazirX’s wallet, allowing him to execute transactions without needing further signatures.

Dolev speculated that the attacker compromised WazirX endpoints or laptops to gain necessary signatures, possibly through a user interface (UI) hijack on Liminal’s side.

Liminal Custody maintained that its platform remains secure, with preliminary investigations showing that a self-custody multisig smart contract wallet created outside its ecosystem was compromised.

Some analysts suspect North Korean hackers, possibly the Lazarus Group, may be responsible for the hack.

Blockchain forensics firm Elliptic and ZachXBT noted patterns characteristic of North Korean actors. The cryptocurrency market experienced significant turbulence, with SHIB tokens dropping 10% in value.

WazirX has filed a police complaint, reported the incident to relevant authorities, and is contacting over 500 exchanges to block identified addresses, with many exchanges cooperating in recovery efforts.


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