Highlights of the Week- Issue #53

Jul 15, 2024

Preview

Former US President Donald Trump announced to speak at Bitcoin 2024 in Nashville, an assassination attempt occurred at a rally on July 14th, market reacted with a bitcoin surge, anticipates with Trump's election chance and current political instability. MicroStrategy has announced a 10-for-1 stock split, making its shares more accessible. Japanese firm Metaplanet has invested $2.5 million in Bitcoin, increasing its holdings to 203.7 BTC. Mempool has launched Accelerator™ Service for faster transaction speeds. Swiss app Relai requires user verification by October 31, 2024, for access to key features. Paxful co-founder Artur Schaback has pled guilty to AML and KYC violations, facing up to five years in prison. DigitalX received approval for a Bitcoin ETF on the Australian Securities Exchange, set to trade as BTXX. The Republican National Committee's 2024 draft platform endorses Bitcoin, emphasizing self-custody rights and opposing a Central Bank Digital Currency. For more details, continue reading below.

A. Bitcoin Data Dashboard

As of July 15. 2024

B. Bitcoin Ecosystem

1. Trump reaffirms Bitcoin 2024 speech commitment following assassination attempt

Former US President Donald Trump has been announced as a speaker at Bitcoin 2024, taking place in Nashville from July 25-27. Known for historic announcements, the event has previously featured El Salvador's President declaring Bitcoin legal tender and U.S. Presidential candidate Robert F. Kennedy Jr. supporting the Bitcoin industry. Trump's inclusion is notable due to his recent commitments to the Bitcoin community, including meetings with major U.S. Bitcoin miners and pledges to support Bitcoin mining and protect self-custody rights for crypto holders if elected. His pro-Bitcoin stance contrasts with President Joe Biden's less favorable view of the industry, highlighting differences in their approaches.

On July 13th, Trump was shot in his right ear at a campaign rally in Butler, Pennsylvania. Authorities are investigating the shooting as an assassination attempt, which occurred shortly after Trump started speaking onstage. Bitcoin surged past $60,000 following the attempt, with some anticipating it will boost Trump’s election chances, while others attribute the rise to political instability.

Reference: NBC News, Bitcoin Magazine

2. MicroStrategy announces 10-for-1 stock split

MicroStrategy's board has announced a 10-for-1 stock split of its Class A and B common stock, set to increase accessibility for investors and employees. The stock split, executed as a stock dividend, will provide nine additional shares per share owned. The new shares will be distributed after trading closes on August 7, 2024, with split-adjusted trading beginning on August 8, 2024. The split will not affect voting rights. MicroStrategy also emphasized its role as a Bitcoin development company, highlighting its strategy of accumulating Bitcoin as its primary treasury reserve asset through cash flows and equity and debt financings.

Reference: Cointelegraph, Microstrategy

3. Metaplanet boosts bitcoin holdings with $2.5 million investment

Metaplanet, a publicly-listed firm in Japan, is increasing its Bitcoin holdings during a drop in BTC prices, purchasing an additional 42,466 bitcoins for 400 million yen ($2.5 million) on July 7. This brings Metaplanet's total to 203.7 BTC, bought at an average price of around 10 million yen ($62,000) per coin, about 7% higher than the current BTC price. Metaplanet first entered the Bitcoin market in April 2024, purchasing its initial batch for $6.5 million, supported by industry figures like Mark Yusko and companies such as Sora Ventures. Dubbed "Asia’s MicroStrategy," Metaplanet's aggressive Bitcoin acquisition strategy mirrors MicroStrategy’s, which began buying Bitcoin in 2020 and now holds 226,331 BTC.

Reference: Cointelegraph

4. Mempool launches Accelerator™ Service, offering enhanced transaction speeds and transparency

Mempool facilitates transaction acceleration by forwarding requests to its network of mining pool partners. Upon acceptance, these partners prioritize transactions based on the requested accelerated fee rate. For instance, utilizing Mempool Accelerator™ can raise a transaction's fee rate from 1 sat/vB to a targeted 20 sat/vB, ensuring faster processing and inclusion in blocks. Users have the option to pay for accelerations using Lightning or Cash App Pay, or to fund their Mempool Accelerator™ Pro account with onchain BTC or Lightning credits. "For enterprise clients, Mempool offers Accelerator™ Pro, reducing acceleration costs. Users specify their maximum bid, and once acceleration is confirmed, Mempool retrospectively calculates the fee sufficient for block inclusion. All accelerations through Mempool Accelerator™ are publicly recorded, accessible via the Mempool Accelerator™ dashboard, recent accelerations page, or through the public API.

Reference: Nobsbitcoin

5. Relai requires verification for all users by October 31, 2024

Relai, a Swiss-based app for buying bitcoin directly to self-custody, announced that all users must verify their accounts by October 31, 2024. Verified status is necessary for accessing features like buy orders and wallet functions. Users can retain control with their 12-word backup phrase, ensuring their Bitcoin remains in self-custody. Relai emphasizes this change is crucial despite exploring alternatives. Additionally, verified users can soon benefit from new European IBAN and Instant SEPA features. Once verified, customer’ll be able to trade up to 100,000 CHF/95,000 EUR per year.

Reference: Relai

6. Paxful co-founder Artur Schaback pleads guilty to AML and KYC violations

Artur Schaback, co-founder and former CTO of Paxful, has accepted a plea deal with U.S. prosecutors that may lead to a maximum sentence of five years in prison. The U.S. Department of Justice announced on July 8 that Schaback will be sentenced on November 4 and will resign from Paxful’s board. Legal documents revealed that Schaback and Paxful’s President and CEO, Mohamad (Ray) Youssef, failed to establish required anti-money laundering (AML) and Know Your Customer (KYC) programs. This allowed Paxful to become a vehicle for money laundering and other criminal activities from July 2015 to June 2019. In March 2023, Schaback sued Youssef over company control, alleging fund misappropriation and sanctions violations. In May 2023, Roshan Dharia was appointed interim CEO of Paxful.

Reference: Atlas 21.com

7. DigitalX gains approval for spot bitcoin ETF on Australian Securities Exchange

Blockchain asset manager DigitalX has received regulatory approval to launch its spot Bitcoin exchange-traded fund (ETF), set to trade on the Australian Securities Exchange (ASX) under the ticker BTXX. Trading will commence on July 12 at 10 am local time, the firm announced on July 8. CEO Lisa Wade highlighting that the DigitalX Bitcoin ETF offers ASX customers direct access to Bitcoin through a regulated, liquid fund structure.DigitalX partnered with K2 Asset Management, which will act as the responsible entity and issuer of the ETF. This approval follows the ASX’s recent approval of VanEck’s spot Bitcoin ETF, which began trading on June 20 with a first-day volume of $1.3 million. Australian fund manager Betashares is also seeking to launch a Bitcoin ETF on the ASX, indicating a growing acceptance of digital assets in mainstream financial markets. The launch of the DigitalX Bitcoin ETF marks a significant milestone for the company and the broader cryptocurrency market in Australia.

Reference: Cointelegraph

C. Regulation

1. RNC endorses pro-bitcoin stance in 2024 party platform draft

The Republican National Committee (RNC) has endorsed a pro-Bitcoin stance in its 2024 party platform draft, approved by an RNC panel and set for a final vote on Tuesday. The draft includes a section stating: "We will defend the right to mine Bitcoin and ensure every American has the right to self-custody of their digital assets and transact free from Government Surveillance and Control." This marks a significant policy stance, emphasizing the RNC's commitment to protecting Americans' rights to engage in Bitcoin mining and manage their Bitcoin without government intrusion. The draft also criticizes the Democratic Party's approach to Bitcoin and opposes the creation of a Central Bank Digital Currency (CBDC). As reported by The Hill, the draft received overwhelming support from the platform committee, indicating a growing faction within the Republican Party that values promoting and protecting the Bitcoin sector. This move aligns with previous statements from Republican figures, including former President Donald Trump, who stated in May that he "will ensure that the future of crypto and Bitcoin will be made in the USA." The draft platform reflects a broader trend of Bitcoin advocacy within the Republican Party, which could impact future regulatory and legislative approaches to Bitcoin in the United States.

Reference: Nasdaq.com

2. Nigerian Finance Minister urges SEC to tackle cryptocurrency regulation

Wale Edun, Nigeria’s Minister of Finance, has called on the newly inaugurated Securities and Exchange Commission (SEC) board to address the complexities of cryptocurrency regulation. Speaking at the board’s inauguration in Abuja, Edun emphasized the need for stringent oversight in sectors like cryptocurrencies to maintain market integrity. He warned that minimal registration requirements could be exploited, urging the SEC to implement strong governance practices and adhere to global standards. Edun also encouraged the SEC to adopt innovative strategies amid rapid developments in AI, digital currency, and fintech. “The financial sector is rapidly evolving. The SEC must stay informed and adaptable to provide necessary approvals and guidance,” he said. SEC board chairman Mairiga Katuka assured the minister of the board's commitment to leveraging expertise and innovation to drive growth. Katuka expressed optimism about Nigeria’s economic outlook and the board's role in fostering a resilient financial ecosystem. On April 19, 2024, President Bola Tinubu appointed seven members to the SEC board. Following these appointments, the SEC amended its rules on digital asset issuance, offering platforms, exchange, and custody to enhance the regulatory environment.

Reference: Bitcoin.com

D. Macroeconomy

1. Sahm Rule activation raises concerns of US recession

The Sahm Rule, a key economic indicator, has been activated, suggesting a potential US recession. This rule, named after economist Claudia Sahm, indicates a recession when the three-month average unemployment rate exceeds the lowest rate of the past 12 months by over 50 basis points. In June, the unemployment rate rose to 4.1%, with a three-month average of 4%, surpassing the previous low of 3.5%. Claudia Sahm has advised the Federal Reserve to consider cutting interest rates to mitigate recession risks. The latest jobs report shows 206,000 new jobs created in June, indicating a slowing yet strong job market. Construction saw growth, while manufacturing and retail employment declined. Wage growth also slowed, with average hourly earnings up 3.9% year-over-year, the smallest increase since June 2021, suggesting easing job market tightness and potential inflation deceleration. The household survey revealed a faster increase in the labor force compared to the working-age population, resulting in a slight unemployment rate increase from 4% in May to 4.1% in June. The Federal Reserve may consider these factors and potentially ease monetary policy, but future inflation data will be crucial in their decision-making.

Reference: Delloite insights, Wikipedia

2. BIS warns against premature easing of monetary policy

The Bank for International Settlements (BIS) has cautioned central banks against loosening monetary policy too soon. In its annual report, the BIS acknowledged progress in inflation and growth globally but highlighted ongoing risks, including policy failure. Despite declining inflation in major economies, it remains above central-bank targets, particularly in services. The BIS warned that premature easing could reignite inflationary pressures, forcing costly policy reversals and undermining credibility. Research indicates that the ratio of service prices to goods prices remains below pre-pandemic levels, reflecting a trend toward restoring traditional price relationships. This suggests that overall inflation may stay above pre-pandemic levels for some time. Additionally, the BIS highlighted risks from high fiscal deficits and issues in the commercial property market. It noted that current fiscal policies in major economies are unsustainable and could eventually trigger adverse reactions from investors, disrupting financial markets and posing challenges for central banks. A BIS official remarked, “We know that things look sustainable until suddenly they no longer do—that is how markets work.” While fiscal expansion supported post- pandemic recovery, tightening policies could slow growth.

Reference: BIS.org

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