ETFs
Spotting Bitcoin ETFs heading for exits before halving them
Key takeaways
- Bitcoin has been trading flat as cryptocurrency markets prepare for a Bitcoin halving later this week.
- Spot Bitcoin exchange-traded funds (ETFs) saw net outflows last week, a rarity for the new asset class.
- Uniswap Labs has received a Wells Notice from the SEC, a sign that the decentralized exchange will face a lawsuit from the securities regulator.
- Monad Labs has raised $225 million to build a layer 1 blockchain to compete with Ethereum and Solana.
Bitcoin (BTCUSD) traded flat while spot Bitcoin exchange-traded funds (ETFs), which have driven up demand for Bitcoin and consequently its price, saw a rare week of net outflows as markets prepared for the halving event later this week.
Uniswap Labs has received a Wells Notice from the United States Securities and Exchange Commission (SEC). Monad Labs raised $225 million from Paradigm and others.
Spot Bitcoin ETFs See Net Outflows Ahead of Halving Week
Last week in the United States Bitcoin Spot ETF experienced net outflows, a rare phenomenon that has only happened three times since these funds were introduced in January.
Between April 8 and 12, the category, which includes 11 funds, reported an asset loss of approximately $83 million, according to data from BitMEX Research. This represents a significant change from the previous week’s net inflows of $485 million. Despite this setback, spot bitcoin ETFs have accumulated $12.5 billion in positive net inflows since their launch.
In particular, the Grayscale Bitcoin Trust ETF (GBTC) continued to show a decline, with $767 million flowing out of the fund last week alone. In contrast, other leading funds such as BlackRock’s iShares Bitcoin Trust (I BITE) and the Fidelity Wise Origin Bitcoin Fund (FBTC) brought in $487 million and $90 million, respectively, but these earnings were insufficient to offset the substantial outflows from GBTC.
The demand generated by spot bitcoin ETFs has been attributed to the recent rise in bitcoin prices, and it is also considered a key differentiator for the next Bitcoin halving compared to previous instances.
Uniswap Labs receives notice regarding Wells
Decentralized crypto exchange Uniswap last week, revealed that it had received a Wells notice from the SEC, indicating imminent enforcement action.
This led to a sharp drop in the price of Uniswap’s native token, UNI, from over $11 before the news was announced to under $8. Hayden Adams, CEO of Uniswap Labs, shared his disappointment and willingness to dispute the charges against X. Wells’ notices serve as early warnings of potential regulatory charges and often precede formal charges. coercive measures.
The SEC’s concerns centered on allegations that Uniswap operated as both an unregistered broker-dealer and securities exchange, Uniswap executives Mary-Catherine Lader and Marvin Ammori clarified during a press conference , according to CoinDesk. The details of whether UNI itself could be classified as a security were not clear from the notice. Ammori referenced a recent court ruling favorable to Coinbase, which he sees as a positive indicator for Uniswap’s defense against similar accusations.
Monad Labs raises $225 million
Monad Labs secured $225 million in a funding round led by Paradigm, allowing the company to expand its team and advance the development of its blockchaindesigned to fight against Ethereum.
This financial support aims to move Monad’s test version of its blockchain towards a full production stage. Its layer 1 blockchain maintains compatibility with the Ethereum Virtual Machine (EVM). According to Monad’s announcement on Substack, EVM processes over 96% of all investments in decentralized finance (DeFi).
While Ethereum is currently limited to processing fewer than 20 transactions per second, Monad’s newly operational testnet, launched in March, demonstrates an ability to process around 10,000 transactions per second. This significant increase in transaction throughput is part of a larger trend within the crypto community, which is seeing various entities, including both Layer 1 and Layer 2 solutions, striving to improve the efficiency of DeFi. Monad’s approach incorporates parallel execution to significantly improve the performance of the entire protocol.
This funding round also attracted investments from several notable companies, including Electric Capital, Castle Island Ventures, Animoca Ventures, Coinbase Ventures, and CoinFund, highlighting broad industry support for Monad’s technology.
What to expect in the markets this week
All eyes are on Bitcoin’s planned halving this week, as the fourth iteration of the cryptocurrency’s planned issuance rate drop is expected to take place by the end of the month.
Reduce by halfwhich occurs every 210,000 blocks, or roughly every four years, reduces the pace of mining new bitcoins and halves incentives for miners.
While previous halvings have led to gains for Bitcoin in the past, several industry reports have indicated that the Bitcoin ETF spot market could have a greater impact on the cryptocurrency. supply and demand dynamic at this stage.
Despite the upcoming drop in bitcoin-denominated income for miners, it is possible miners could benefit from an increase in their revenue in dollar terms due to the potential for a rise in Bitcoin prices combined with developments in Ordinary and various Layer 2 networks.