Fund flows into United States-listed spot Ethereum exchange-traded funds (ETFs) have shifted to a daily net positive for the first time since their launch day, primarily due to a reduction in outflows from the Grayscale Ethereum Trust.
On July 30, net inflows across all nine spot Ether ETFs totaled $33.6 million, according to preliminary data from Farside Investors and decentralized aggregator Tree News.
Although the figure isn’t exceptionally high, it marks the first time these funds have seen inflows since their launch.
Since July 24, about $547 million has exited the spot Ether investment products. On July 30, BlackRock’s iShares Ethereum ETF (ETHA) led with $117.9 million in inflows.
Fidelity’s Advantage Ether ETF (FETH) followed with $16.4 million, while Bitwise Ethereum Fund (ETHW) and Franklin Ethereum ETF (EZET) recorded $3.5 million and $3.7 million, respectively.
Grayscale’s ETHE, however, experienced its smallest day of outflows, amounting to just $120.3 million—significantly less than its outflows on launch day. Several other ETFs reported zero inflows and outflows.
Ethereum advocate Anthony Sassano referred to the positive trend as “Larry Fink’s birthday present to Ethereum.”
Split Capital founder and chief investment officer Zaheer Ebtikar noted, “Definitely some rotating capital,” highlighting that spot Bitcoin ETFs saw outflows of $18.3 million on the same day.
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On July 29, Steno Research senior analyst Mads Eberhardt suggested that the large outflows from Grayscale’s ETHE might decrease, which seems to have already happened.
In a post on X on July 31, ETF Store President Nate Geraci remarked that in just one week of trading, BlackRock’s iShares Ethereum ETF ranked in the top 15 for inflows among all ETFs launched this year, out of approximately 330 new ETFs.
Since its launch on July 23, the BlackRock ETHA fund has amassed $618 million in inflows, positioning it as the industry leader among Ethereum ETFs, alongside its standing in Bitcoin ETFs.
On July 29, BlackRock’s ETF and investments chief, Samara Cohen, mentioned that Ethereum ETFs are expected to become part of model portfolios offered by large wirehouses by the end of the year.
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Bitcoin aimed for $68,000 at the July 22 Wall Street open as a Chinese interest rate cut bolstered bullish sentiment in the crypto market.
Data from Cointelegraph Markets Pro and TradingView showed Bitcoin (BTC) targeting range highs after dipping below $67,000 earlier in the day.
This upward shift coincided with mixed performances in Asian stocks as China announced unexpected interest rate cuts.
The People’s Bank of China (PBoC) confirmed it would cut the seven-day reverse repo rate by 0.1% to 1.7%, alongside reductions in the one-year and five-year loan prime rates (LPR), as reported by sources including Reuters.
“The cut today is an unexpected move, likely due to the sharp slowdown in growth momentum in the second quarter as well as the call for ‘achieving this year’s growth target’ by the third plenum,” Larry Hu, chief China economist at Macquarie Group, told the publication.
Commenting on the market’s reaction, Holger Zschaepitz noted the rarity of such a cut. “Chinese stock market not really enthusiastic,” he wrote on X.
Global interest rate reductions are crucial for the performance of risk assets, including crypto. Despite China and Europe’s rate cuts, the United States has not yet initiated a similar cycle, with expectations set for September.
TMXC Trades offered a more cautious perspective, suggesting that China’s rate cuts might not yield the anticipated results.
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“Coming into 2024, traders were betting on a massive coordinated global easing cycle… Here today in mid-July, virtually none of that has come to pass,” it stated.
Bitcoin, meanwhile, faced its final resistance cluster before reaching all-time highs, with $69,000 being a key level since late 2021.
“Bitcoin has cancelled out almost the entirety of the -25.6% retrace,” popular trader and analyst Rekt Capital noted in his latest X analysis.
“It took two weeks to almost fully cancel out a five-week retrace.”
“Accompanying charts compared recent BTC price behavior to other bull market retracements, identifying the latest as the deepest of the uptrend.
“Any dips to retest $65,000 would not be out of the ordinary,” Rekt Capital added, anticipating potential upside to $71,500.
Rekt Capital reiterated the case for new all-time highs by September “at the latest.”
“Bitcoin is back in the range and provides a lot of strength,” Michaël van de Poppe, founder and CEO of trading firm MNTrading, commented.
He emphasized $65,000 as a crucial support level, with $61,000 as the next line of defense.
“If that’s going to happen this week, then we should be good for continuation toward the ATH,” he predicted.
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Bitcoin experienced a drop of over 3% on July 16 due to concerns related to the defunct exchange Mt. Gox.
Data from Cointelegraph Markets Pro and TradingView indicated that BTC’s price was under pressure after reaching $65,000 on Bitstamp.
The decline occurred as Bitcoin from Mt. Gox moved between wallets associated with its rehabilitation program.
Crypto intelligence firm Arkham reported that approximately 92,000 BTC (valued at around $5.7 billion) was transferred out of Mt. Gox’s cold wallet, constituting about two-thirds of the exchange’s total holdings.
“Mt. Gox moved 44,527 $BTC (2.84B) to an internal wallet 5 minutes ago, which may be preparing for repayment,” noted onchain analytics platform Look Into Bitcoin on X (formerly Twitter).
The impending distribution of refunds to Mt. Gox creditors, who originally lost their assets when the exchange was hacked and subsequently closed more than a decade ago, has historically impacted prices negatively.
Markets fear massive BTC sales as a result.
However, some argue that these fears are exaggerated. “And here is the next Bitcoin FUD,” remarked popular crypto investor and YouTuber Quinten Francois on X.
Cointelegraph previously reported that sell-side pressure affecting markets in recent weeks also stemmed from the German government, which had sold off its stocks of confiscated BTC, now depleted.
The disruption from these concerns interrupted what had been one of Bitcoin’s strongest performances in recent months.
BTC/USD had last reached $65,000 on June 21, a critical level reflecting Bitcoin’s short-term holder cost basis.
This cost basis, also known as realized price, serves as support during bull markets and was last breached in August 2023.
Look Into Bitcoin recorded the short-term holder cost basis at $64,835 as of July 15.
The resurfacing of Mt. Gox-related fears thus added to the already present market anxieties, influencing Bitcoin’s price movements and market sentiment.
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On July 4, Bitcoin‘s price briefly dropped to $57,874 on Coinbase, marking its first dip below $58,000 in over two months.
Since then, it has stabilized at $58,964 but remains down 3.4% for the week, according to TradingView.
This slump is attributed to the liquidation of leveraged long positions.
Data from CoinGlass reveals that more than $54.9 million in Bitcoin long positions were liquidated within the past 24 hours.
“Nearly $60 million in Bitcoin longs have been wiped in the last 24 hours,” states CoinGlass.
Ether traders also faced significant losses ahead of the anticipated launch of several spot Ether ETFs, expected by mid-July. In total, $57.9 million in Ether long positions were liquidated during the same period.
Much of the blame for Bitcoin’s broader price pullback is attributed to the defunct Japanese crypto exchange Mt. Gox, which is set to begin repayments of approximately $8.5 billion worth of BTC to its creditors starting in early July.
However, some analysts believe these repayments may not have as severe an impact on Bitcoin as anticipated.
Other major cryptocurrencies and altcoins also experienced sharp declines during Bitcoin’s brief dip. Ether dropped 4.5%, briefly hitting $3,145 during a sharp sell-off at 2:00 am UTC on July 4.
BNB fell 6%, decreasing from $573 to $539 at the time of writing. Solana saw a 10.3% decline, falling from a weekly high of $154 to $136.
Meanwhile, mentions of “buy the dip” surged across social media platforms.
The use of this phrase has doubled on Reddit, X, and 4Chan over the last two days.
These recent movements in the crypto market highlight the volatility and significant impact of leveraged positions on price fluctuations.
The upcoming Mt. Gox repayments and the launch of Ether ETFs are key events that market participants are closely monitoring.
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Major technology conglomerate Opera is enhancing its cryptocurrency wallet on the mobile browser Opera Mini by integrating the market’s largest stablecoins, Tether’s USDT and Circle’s USDC.
MiniPay, a stablecoin-based self-custodial wallet embedded in Opera Mini, is launching Pockets, a new feature enabling one-click swaps between the Celo dollar (cUSD) and the newly integrated stablecoins.
Pockets will allow MiniPay users to effortlessly switch between USD Coin (USDC), Tether (USDT), and cUSD with “sub-cent fees and no hidden costs” using a drag-and-drop motion, according to a May 3 announcement.
“This feature abstracts asset swapping in Web3, allowing users to effortlessly swap between all three stablecoins by simply dragging coins between virtual pockets, never having to worry about gas fees,” Jørgen Arnesen, executive vice president of Mobile at Opera, told Cointelegraph.
Launched in September 2023, MiniPay is built on the Celo blockchain and utilizes Mento’s stablecoin cUSD, which is pegged to the value of the United States dollar.
Initially rolled out in Africa, the wallet extension aims to help local populations send and receive stablecoins using mobile numbers.
“Given the lack of fixed internet access and high internet costs, we recognized the significant potential of blockchain-enabled peer-to-peer solutions within the continent,” Arnesen said, adding:
“Our research showed that most consumers had concerns over the high fees, unreliable service uptimes, and lack of transparency around transaction progress associated with local payment options. High mobile-data costs were and still are an omnipresent issue.”
In addition to the new Pockets feature, MiniPay introduced a Discover Page for decentralized applications (DApps) integrated within the wallet.
This page is designed to organize multiple native DApps, providing users direct access to tools such as Universal Basic Income protocols, savings applications, and games.
Since its launch in 2023, MiniPay has seen over three million wallet activations across Nigeria, Ghana, Kenya, and South Africa, becoming one of the fastest-growing digital wallets on the continent.
Opera Mobile executive Arnesen highlighted Africa’s mobile-first nature, with a young population and widespread smartphone adoption.
“Today, Opera Mini is the most downloaded mobile browser in Africa with nearly 100 million users,” he noted.
Africa is rapidly emerging as a continent with significant interest in cryptocurrency. With one of the youngest and fastest-growing populations globally, Africa has massive potential for digital asset adoption.
According to BitcoinAfrica.io, South Africa, Nigeria, Zimbabwe, Kenya, and Ghana were the top five African countries adopting Bitcoin in 2023.
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MakerDAO, a pioneering decentralized finance (DeFi) lending protocol and the creator of the stablecoin DAI, has announced a groundbreaking $1.35 million audit contest. This is the largest audit contest ever conducted in the DeFi space.
The contest will take place on the Sherlock Platform, a Web3 audit contest provider, and is an integral part of MakerDAO’s Endgame project, which is slated to begin in summer 2024.
Starting on July 8 and running until August 5, the contest aims to engage top security experts and new researchers to uncover potential vulnerabilities.
Endgame represents the final development stage in MakerDAO’s strategic plan. Its goal is to reform governance to achieve a self-sustaining balance, known as the Endgame State.
Rune Christensen, co-founder of MakerDAO, emphasized the importance of robust security for the Endgame launch:
“Rock solid security has always been a priority for MakerDAO. Over time, it’s become one of the defining features of the project.
“It only makes sense that the team would work with the market leader, Sherlock, to create a program to pressure test the system we’re building as Maker moves toward Endgame.”
A MakerDAO spokesperson, in a written Q&A with Cointelegraph, highlighted the rigorous security measures already in place:
“The Endgame products and features […] have been audited numerous times by multiple reputable auditing firms.
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The audit contest is an additional way to test the system. It underscores Maker’s commitment to open source and security while giving integrators and builders a chance to get familiar with Endgame before it gets launched.”
Jack Sanford, co-founder of Sherlock, acknowledged MakerDAO’s dedication to security with this record-breaking contest. He elaborated on the contest’s setup:
“Sherlock has reserved some of the top security experts in the world for this contest, but many up-and-comers will undoubtedly make a name for themselves and show a strong performance in this historic contest.”
The decision to host the contest on Sherlock was strategic, as the MakerDAO spokesperson explained:
“Sherlock is a pioneer in auditing contests for crypto projects and they have a deep network of reputable security researchers. It only makes sense that Maker would seek to work with the best in the space.”
Before the contest begins, the top MakerDAO bug bounty hunters will provide an educational breakdown during the week of July 1.
This will include a code walkthrough with the MakerDAO team and “crypto legends.”
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Hong Kong-based cryptocurrency exchange Gate.HK has shut down after failing to meet the upcoming local licensing requirements set to take effect on June 1.
The Hong Kong Securities and Futures Commission (SFC) mandated that all crypto exchanges in the region acquire an operational license, requiring those that failed to apply to cease services by May 31.
Gate.HK applied for a license on February 28, but withdrew the application on May 22, citing the need for a “major overhaul” of its trading platform.
As of May 23, Gate.HK has stopped acquiring new users and ceased all marketing activities.
Current users can no longer make deposits and are only able to withdraw funds until August 28.
The exchange will permanently delist all tokens, including Bitcoin, Ether, Solana, Polygon (MATIC), and Tether (USDT), on May 28, effectively shutting down its trading platform.
Gate.HK plans to relaunch its services once its platform is reconstructed to comply with Hong Kong’s regulatory requirements, which include establishing Anti-Money Laundering and Counter-Terrorist Financing measures.
The company stated, “Gate.HK is actively working on the aforementioned overhaul.
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“We plan to resume our business in Hong Kong in the future and contribute to the virtual asset ecosystem after obtaining the relevant licenses.”
The closure of Gate.HK coincides with the announcement of another major global exchange, OKX, which stated on May 24 that it would exit the Hong Kong market.
OKX will cease providing centralized virtual asset trading services to Hong Kong residents by May 31, 2024.
The announcement reassured customers, saying, “Customer funds remain safe, and withdrawal services will not be affected. After May 31, 2024, customers can only withdraw.”
Prior to Gate.HK’s exit, three other exchanges — Huobi HK, QuanXLab, and IBTCEX — also withdrew their license applications in May.
Additionally, a recent Bloomberg report indicated that the SFC is considering allowing spot Ether exchange-traded fund (ETF) issuers to include an ETH staking option to generate passive income.
The SFC is currently discussing providing staking services via licensed platforms with the country’s crypto ETF issuers, although no timeline for implementation has been set.
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The approval of spot Ether exchange-traded funds (ETFs) is seen as “implicit recognition” from the United States Securities and Exchange Commission (SEC) that Ether is not a security, according to industry experts.
This decision might have broader implications for other tokens as well.
“These are commodities-based trust shares, so the SEC, by approving these, is explicitly saying they’re not going to go after Ether as a security,” stated Bloomberg ETF analyst James Seyffart during a discussion with Ryan Sean Adams on the Bankless podcast.
Digital asset lawyer Justin Browder believes that if Ether ETFs receive S-1 approval — the final requirement for them to begin trading — then the “debate is over: ETH is not a security.”
Adam Cochran, a partner at venture capital firm Cinneamhain Ventures, suggested this approach could extend to other tokens: “ETH is a commodity, even with its current attributes.
That means we can extrapolate to A LOT of other projects what elements matter in security. Today a lot of things probably clearly became commodities, even if they don’t know it yet.”
However, Seyffart and others believe the SEC might still target those involved with staking Ether.
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“[I think they will] try to thread this needle and say ETH itself, they’re not going to call a security but staked ETH might be a security […] and I don’t believe they’re going to give that up any time soon.” Digital asset lawyer Joe Carlasare echoed this sentiment.
“The SEC could pursue individual actors and staking as a service even with the ETF launched. I think other actions are less likely,” Carlasare told Cointelegraph.
In April, Ethereum infrastructure firm Consensys received a Wells notice from the SEC, which focused on MetaMask’s trading and staking services.
Finance lawyer Scott Johnsson noted that the SEC didn’t confirm Ether’s non-security status in its approval order, saying it “completely sidestepped” the issue.
The SEC officially approved 19b-4 applications from VanEck, BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK 21Shares, Invesco Galaxy, and Bitwise to issue spot Ether ETFs on May 23.
Many ETF issuers notably removed staking in their final amendments.
Hashdex was the only ETF issuer that didn’t receive regulatory approval on the day.
However, the eight approved ETF issuers will need to wait until the SEC signs off on their S-1 registration statements before launching.
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DAO Maker, a crypto fundraising platform focused on Web3 projects, is distinct from the MakerDAO stablecoin protocol and aims to raise significant funds in 2024.
Despite this initiative, the platform is under scrutiny from victims of a 2021 hack who claim they have not been fully compensated for their losses, despite promises from the development team.
The hack, resulting in a loss of approximately $7 million, was attributed to a compromised private key, which victims allege stemmed from developer negligence.
Initially, DAO Maker responded to the August 2021 breach by distributing 500 USD Coin per affected user and promising further compensation through a new IOU token named “USDR,” scheduled to be redeemable within a year for the platform’s native DAO token at enhanced rates.
However, victims told Cointelegraph that they were never able to redeem their USDR tokens, and the promised redemption process was reportedly canceled following a governance vote influenced by DAO Maker using its substantial token holdings.
Adding to the controversy, a decentralized finance (DeFi) researcher from SOMA Analytics reported that DAO Maker might have manipulated the governance vote to abandon the USDR redemption and attempted to erase evidence of this decision.
Victims of the hack remain uncompensated, and the USDR token has become nearly worthless, with no active market or exchange possibilities.
One investor, speaking under the pseudonym “Red Drac,” described receiving 500 USDT immediately after the hack and 1,500 USDR later, which they were unable to redeem or sell at full value.
They discovered a liquidity pool that offered the USDR tokens at a substantial discount but chose not to sell, leaving the tokens in their wallet.
Another affected user, “Zztelecom,” also highlighted the inability to redeem USDR, buying them at a discount in the hope of future gains that never materialized.
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SOMA Analytics further detailed how a specific proposal on the DAO Maker platform to adjust the USDR redemption terms was passed by just six wallets, suggesting potential manipulation.
This proposal reduced the redemption value of USDR significantly, contradicting earlier commitments.
Despite the DAO vote favoring a 50% redemption rate, no compensation was distributed, and the tokens were made unredeemable for anything other than DAO Power on the platform, effectively rendering them useless in the secondary market.
The situation has left many investors with tokens that offer little more than the potential to participate in future token offerings without guarantee of profit.
As DAO Maker continues to operate, servicing Web3 startups and maintaining a significant market presence, the unresolved issues from the hack raise ongoing concerns about governance and compensation practices within the platform.
Cointelegraph’s inquiries to DAO Maker for comments remained unanswered at the time of publication.
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Puffer Finance, a burgeoning liquid staking initiative based on the Ethereum restaking protocol Eigenlayer, has successfully raised $18 million in a Series A funding round.
This significant financial injection is aimed at facilitating the launch of its mainnet.
The funding round, as announced on April 16, saw participation from a variety of investors including industry heavyweights such as Brevan Howard Digital and Electric Capital, along with contributions from Coinbase Ventures, Kraken Ventures, Lemniscap,
Franklin Templeton, and Avon Ventures—a venture capital fund linked to Fidelity Investments’ parent company. Other notable investors included Mechanism, Lightspeed Faction, Consensys, Animoca, GSR, and several angel investors.
The announcement detailed how Puffer Finance had achieved a milestone shortly after its preliminary test phase in February, amassing over $1.2 billion in total value locked (TVL) according to DefiLlama.
To date, the project has garnered $23.5 million in venture capital.
“Following this round, Puffer secured a strategic investment from Binance Labs, enhancing its position within the Liquid Restaking ecosystem,” the company stated.
The announcement also highlighted upcoming “technological advancements” set to coincide with the mainnet debut.
Puffer Finance’s innovation significantly lowers the entry threshold for Ethereum validators by reducing the required capital from 32 Ether to just one.
Users who stake their Ether through Puffer are rewarded with Puffer liquid restaking tokens (nLRTs), which can be used concurrently in other decentralized finance protocols to farm yields while still earning Ethereum staking rewards.
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This method, known as liquid staking, has previously been utilized by other blockchains like Cosmos and has recently been adopted by Ethereum following the network’s transition to a proof-of-stake model through the Merge upgrade.
“We aim to significantly reduce the barriers for home validators to participate, while delivering the most advanced liquid restaking protocol,” Amir Forouzani, a core contributor at Puffer Labs, commented.
In related news, Eigenlayer, the protocol on which Puffer Finance is built, recently surpassed Aave in TVL, as reported by Cointelegraph on March 6.
Following a temporary lift on staking caps, the protocol attracted $10.4 billion in crypto assets.
Additionally, data from Dune Analytics reveals that Eigenlayer boasts over 107,900 unique depositors, with DefiLlama statistics indicating that 74% of the staked tokens comprise Wrapped Ether (wETH) and Lido Staked Eth (stETH).
The liquid staking sector has grown substantially, now standing as the largest DeFi protocol category with nearly $55 billion in locked value spread across roughly 160 protocols, dominated by Lido, which alone accounts for $35 billion.
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