Historic Bitcoin Exodus | This Week in Crypto – Jan 1, 2024

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The final countdown for Bitcoin ETF approval has begun, MicroStrategy adds more BTC to its stack, and what were the biggest crypto stories of last year?  These stories and more, this week in crypto.

Lowest Bitcoin Balance Since 2018

Over 28,000 Bitcoins valued at $1.2 billion exited centralized exchanges on Thursday, marking the largest daily outflow since December 2022. As investors express their preference for holding their own coins for the long-term, the result is the lowest Bitcoin balance on exchanges since April 2018. Altcoin rankings shuffled a bit, as Solana’s SOL stumbled, while BNB surged by 15%, reclaiming crypto’s fourth spot for total market cap.

MicroStrategy Pushing BTC Holdings

MicroStrategy announced that it acquired over 14,000 BTC at an average price of $42,000 in December. Their stock price surged 8% on the announcement of the $600 million purchase, and in 2023 its stock soared 350%. The strategy to bolster reserves with Bitcoin has strengthened the stock’s appeal, given the closely correlated price movement with Bitcoin’s.

Final Countdown For Bitcoin ETF Approval

In seeking approval for bitcoin ETFs, BlackRock and Valkyrie have disclosed their authorized participants, or APs. ETF issuers are not allowed to purchase Bitcoin themselves, so APs obtain and manage the underlying assets in order to create and redeem ETF shares on their behalf. BlackRock will partner with J.P. Morgan and Jane Street, while Valkyrie also named Jane Street as one of its APs along with Cantor Fitzgerald.

Bitcoin ETF Approval Event Criticized

While experts expect the SEC to approve all spot Bitcoin ETFs as early as this month, according to data provider CryptoQuant, Bitcoin is expected to correct next month following the potential approval in a “sell the news” event. Meanwhile, a former SEC official, John Reed Stark criticized spot Bitcoin ETFs as potential “fee-driven Wall Street scams”, deeming the concept  simply laughable.

Cathie Wood Dumps Grayscale Position

Cathie Wood’s ARK Invest is exercising caution before the SEC decision on Bitcoin ETFs, selling $81 million worth of Grayscale Bitcoin Trust shares due to conversion uncertainty and $27 million worth of Coinbase shares. At the same time, ARK bought ProShares Bitcoin Strategy ETF shares investing in Bitcoin futures to the tune of $92 million.

India Blocks Major Crypto Exchanges

India’s Financial Intelligence Unit has targeted 9 major crypto exchanges, deeming them as operating illegally and as non-compliant with anti-money laundering laws. Aligning with India’s efforts to integrate crypto into traditional finance, the regulator mandated KYC collection for crypto firms back in March. Binance, Kraken, and Huobi are among the exchanges facing URL blocking in India should they fail to comply.

Elon Musk Supports Bitcoin Ordinals

Elon Musk pointed out problems with regular NFTs and implied support for Bitcoin-based inscriptions. Musk criticized regular NFTs, in that they might lose content because of how the data is stored, and suggested encoding the images directly on the blockchain to keep them safe. He noted that unlike regular NFTs, Bitcoin-based inscriptions are securely saved on the blockchain.

Biggest Crypto Stories of 2023

Fortune has gathered the biggest crypto stories of 2023 in what it describes as a bounce-back year for crypto. Spot Bitcoin ETF applications and new Bitcoin inscriptions have been the major talk over the second half of the year, while the industry also saw conclusions to scandals including Do Kwan and the Terra debacle, FTX and its founder Sam Bankman-Fried, and the resignation of Chengpeng Zhao with Binance’s settlement with the SEC.

That’s what’s happened this week in crypto, see you next week.

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