Grayscale Investments has introduced a new investment fund designed for affluent clients seeking to diversify their portfolios with income derived from staking cryptocurrency tokens.
Named the Grayscale Dynamic Income Fund, it targets individuals with assets exceeding $1.1 million or a net worth above $2.2 million.
The fund’s strategy involves converting staking rewards into U.S. dollars on a weekly basis, with plans to distribute these earnings to investors quarterly.
Grayscale emphasizes the thorough vetting process for selecting proof-of-stake (PoS) tokens to include in the fund, aiming to manage the intricacies of staking and unstaking various tokens, each with unique requirements.
The firm prioritizes maximizing staking income, viewing capital growth as a secondary goal.
Staking, a process that contributes to the security and efficiency of blockchain networks, involves holding cryptocurrency tokens to earn rewards.
Grayscale has disclosed that its fund will comprise three specific PoS tokens: Osmosis (OSMO), Solana (SOL), and Polkadot (DOT), with respective shares of 24%, 20%, and 14%.
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The remaining 43% of the fund is allocated to other tokens.
According to Staking Rewards data, the staking reward rates for OSMO, SOL, and DOT are 11.09%, 7.42%, and 11.9%, respectively, with only SOL ranking in the top 10 PoS tokens by market capitalization on CoinMarketCap.
In related news, Grayscale’s venture into a spot Bitcoin exchange-traded fund (ETF) on January 11 has faced challenges, with over $14 billion in outflows since its inception, as reported by Cointelegraph on March 26.
The Bitcoin ETF, which incurs a 1.5% management fee annually—significantly higher than the 0.30% average of other Bitcoin ETFs—has not met the firm’s expectations.
Additionally, Grayscale’s application for an Ethereum Futures ETF has been met with delays by the United States Securities and Exchange Commission, further complicating the company’s ambitious cryptocurrency investment endeavors.
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In the week leading up to March 29, BNB’s value saw a 12% increase, reaching a high of $620, marking a notable upturn and closing the valuation gap with its rival, Ether, which saw a 5% rise in the same period.
Despite this growth, the BNB Chain’s on-chain data sends mixed signals, indicating that the rally might be overextended.
This recent surge in cryptocurrency value has been linked to inflows into spot Bitcoin BTC exchange-traded funds (ETFs).
However, a setback was observed in the week ending March 23, with a net outflow of $890 million from these ETFs, marking their first net outflow since their introduction in January.
Yet, there was a silver lining with a significant decrease in outflows from the Grayscale GBTC fund, which only saw $104 million leave on March 28.
BNB’s momentum in the first half of March, with a 61.7% increase, was dampened after peaking at $645.
This peak brought BNB’s market capitalization to $96.4 billion, down from its all-time high of $116 billion in November 2021.
The total value locked (TVL) in BNB Chain also saw a decline, from $15.7 billion at its peak to $7.1 billion, a 55% reduction.
The crypto market, especially decentralized finance (DeFi), has seen significant contractions since late 2021.
READ MORE: Bitcoin Braces for Supply Crunch as Demand Skyrockets, Warns CryptoQuant
This downturn isn’t unique to BNB Chain, as the total market data for blockchains tracked by DefiLlama decreased by 25%, from nearly $205 billion to $155 billion.
Despite these challenges, BNB Chain remains a key player in the crypto market, rivaling Ethereum’s layer-2 networks in activity levels.
Nearly 2 million active addresses engaged with DApps on BNB Chain in the past week.
The blockchain also stood out for its trading volume, which, unlike Solana and Ethereum, saw an 11% increase, reaching $12.4 billion.
Looking ahead, the future of the cryptocurrency sector is difficult to predict, but derivative metrics like the demand for leverage in BNB perpetual futures contracts offer insights.
The steady 8-hour funding rate of around 0.03%, equivalent to about 0.6% weekly, suggests a cautiously optimistic market sentiment, despite the price challenges at the $620 level.
This careful optimism is bolstered by the enduring interest in leveraged long positions, despite the uncertain market trajectory.
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Since the launch of the United States spot exchange-traded funds (ETFs) for Bitcoin, the cryptocurrency market has seen a significant shift in Bitcoin holdings on exchanges.
Over $9.5 billion in Bitcoin has been withdrawn from exchanges, as reported by Glassnode, an on-chain analytics firm.
This withdrawal trend started on January 11 and has led to a reduction of over 136,000 BTC from exchange balances.
The dynamics of Bitcoin supply are increasingly favoring bulls with continued mass withdrawals observed this quarter.
The volume of Bitcoin on exchanges has dipped to its lowest since April 2018, with only 2,320,458 BTC remaining, indicating a substantial decline in available BTC for trading.
This trend continued with one of the largest single-day withdrawals occurring on March 27, where over 22,000 BTC, equivalent to $1.54 billion, were withdrawn.
The impact of U.S. spot Bitcoin ETFs, though they have been operational for just under three months, is becoming a pivotal factor in the market.
Additionally, notable market activities include a significant transfer of the stablecoin USD Coin (USDC) to Coinbase, highlighted by J.A. Maartunn from CryptoQuant.
READ MORE: Anthropic Shuns Saudi Investments Amid FTX Bankruptcy Sale, Citing National Security Concerns
This record transfer raised speculations about potential buying pressure in the market. Such movements underscore the evolving dynamics in the cryptocurrency market, particularly in the context of Bitcoin supply and demand.
Experts are closely watching the ETFs’ impact on Bitcoin’s supply, anticipating a possible “squeeze” where demand surpasses the available supply, potentially affecting prices.
This scenario is expected to intensify, especially with the upcoming block subsidy halving event in mid-April, which will further reduce the rate of new BTC entering the market to just 3.125 BTC per block.
Charles Edwards, founder of Capriole Investments, commented on the significance of the upcoming halving event, noting it as “the biggest Halving in Bitcoin’s history.”
He pointed out that Bitcoin would become even more scarce than gold, with the supply growth rate halving.
Edwards anticipates increased institutional demand through ETFs, a supply squeeze from the Halving, and Bitcoin’s new status as the world’s hardest asset, making April a month to watch for the cryptocurrency sector.
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Bitcoin has experienced unprecedented success in 2024, setting a new record high of $73,679 on March 13, maintaining its value around $70,000 since then.
This surge represents an impressive growth of over 140% compared to the previous year.
During its peak this year, Bitcoin momentarily eclipsed silver, becoming the eighth most valuable commodity worldwide by market capitalization.
Looking ahead, projecting similar growth rates into the future suggests that by April 2025, Bitcoin could potentially hit $170,574.
This forecast not only positions it above silver but also surpasses major corporations like Amazon, Alphabet (Google), Saudi Aramco, Nvidia, and Microsoft in CompaniesMarketcap’s rankings of top commodities by capitalization.
This speculative growth assumes a static market environment, using current market caps as a baseline for comparison.
Currently, Bitcoin’s market cap closely trails that of silver, which stands at $1.412 trillion.
To edge past silver again, Bitcoin would need to increase its value to $71,732, reaching a market cap of around $1.413 trillion.
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Moreover, Bitcoin is poised to leapfrog other major entities.
For instance, surpassing Google’s $1.885 trillion market cap requires Bitcoin to reach approximately $95,642.
To dethrone Microsoft from the second spot, Bitcoin would need to surpass a market cap of $3.126 trillion, achievable at a price of roughly $165,608 per BTC.
These projections are grounded in Bitcoin’s recent yearly growth of about 144.82%.
If this trend continues, Bitcoin could see its price soar to $170,574 by next year, boosting its market cap to approximately $3.224 trillion, thereby overtaking Microsoft.
Ultimately, for Bitcoin to claim the top position and surpass gold’s market cap of $15.141 trillion, its value would need to skyrocket to $800,476 per BTC, achieving a market cap of $15.15 trillion.
This scenario underscores Bitcoin’s potential trajectory as the leading commodity by capitalization, highlighting the cryptocurrency’s remarkable growth and its increasingly significant role in the global financial landscape.
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In the documentary 5 Months with Logan Paul, the YouTuber Logan Paul addressed the controversy surrounding his CryptoZoo NFT gaming project, which has been criticized for causing financial losses to investors.
Speaking with journalist Graham Bensinger, Paul faced questions about the allegations against him, particularly the accusation that his involvement led to monetary losses for people.
Paul conceded that there was some truth to these claims but firmly rejected the notion that CryptoZoo was a scam.
He explained, “Everything you just said has an element of truth to it. Here’s the problem. What you just described isn’t a scam.
“I took on a project that I was simply incapable of handling at the time.”
Despite the backlash, Paul revealed he did not profit from the venture, instead losing $500,000 himself, which led him to question, “Where is the scam?”
The project’s failure had a profound impact on Paul’s mental health, driving him to consider suicide due to the ensuing backlash and personal spiraling.
Paul also indicated his intention to address the narrative that paints him as the primary architect behind what some have deemed a fraudulent scheme.
He suggested the criticism, particularly from YouTube journalist Stephen Findeisen, also known as Coffeezilla, was biased, asserting, “The CryptoZoo saga is far from over because it was a one-sided story.
“He [Coffeezilla] told it how he wanted to tell it and told it a certain way that made me look like the captain of the ship.”
Previously, Paul had threatened legal action against Findeisen for his coverage but later apologized and retracted his threats.
Furthermore, Paul discussed his efforts to ameliorate the situation for those impacted by the project’s failure, mentioning a $1.5 million recovery plan launched after a year and following a class-action lawsuit.
However, the plan came with a stipulation that participants waive any potential legal claims against him.
The documentary and Paul’s comments arrive amidst ongoing legal challenges, including a class-action lawsuit filed by investors in February 2023.
These investors accused CryptoZoo and Paul of executing a “rug pull,” alleging that they were defrauded out of millions.
In response to these allegations, Paul announced the commencement of a buyback program on Jan. 5, conditioned upon participants forgoing any legal actions against him, an attempt to provide restitution while navigating the complex aftermath of the project’s downfall.
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Despite facing criminal allegations and concerns about its financial reserves, the Seychelles-based cryptocurrency exchange KuCoin has been deemed “fine” by Ki Young Ju, the CEO of the crypto analytics firm CryptoQuant.
Ju’s endorsement comes amidst user worries over KuCoin’s ability to fulfill withdrawal requests, particularly in light of recent surges in Bitcoin (BTC) and Ethereum (ETH) withdrawals.
Ju observed that these withdrawals, mainly initiated by retail users, had little impact on KuCoin’s overall reserves.
He assured on X, “They appear to not commingle customers’ funds and have sufficient reserves to process user withdrawals,” suggesting from an on-chain analysis that the exchange is stable.
KuCoin’s financial health appears robust, with Scopescan data revealing its total portfolio balance across multiple blockchain networks is valued at $4.889 billion.
This reassurance occurs as the United States Department of Justice leveled allegations against KuCoin’s founders, Chun Gan and Ke Tang, on March 26.
The accusations included a failure to establish an Anti-Money Laundering program and concerns that the platform facilitated “money laundering and terrorist financing.”
Ju also highlighted a key operational difference between KuCoin and the collapsed crypto exchange FTX, pointing out KuCoin’s practice of not mixing customer funds with its own reserves.
READ MORE: Bitcoin Surges Past $71,000 as Whales Accumulate, Pre-Halving Dip Possibly Over
This operational integrity is crucial for user trust, especially when legal issues or reserve status concerns prompt investors to withdraw their assets from exchanges.
The crypto community vividly recalls the rapid withdrawal of funds from FTX following a loss of confidence, triggered by a tweet from Binance’s former CEO, Changpeng “CZ” Zhao, concerning FTX’s native FTT token.
The broader implications of reserve concerns at large exchanges like KuCoin extend beyond their user base, potentially leading to market-wide repercussions.
However, despite the serious nature of the allegations against KuCoin’s founders, the cryptocurrency market’s response has been relatively muted.
The Crypto Fear & Greed Index, a measure of market sentiment, indicates an “extreme level of greed” with a score of 83, suggesting that the wider crypto market remains largely unfazed by the developments surrounding KuCoin.
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The XRPL blockchain, foundational to Ripple’s operations, is poised to revolutionize decentralized finance (DeFi) with its newly launched automated market maker (AMM) protocol, XLS-30.
This development, a collaborative effort with the XRPL community, is designed to enrich the blockchain’s ecosystem significantly.
Ripple‘s announcement of the XLS-30 AMM protocol marks a pivotal expansion in the XRPL ecosystem’s DeFi capabilities, facilitating cross-chain DeFi applications across 50 blockchain platforms.
This innovation aims to complement XRPL’s existing decentralized exchange (DEX), which primarily operates on a traditional order book model lacking the advancements seen in newer DeFi protocols.
A Ripple spokesperson highlighted to Cointelegraph that the AMM is a foundational step towards broader DeFi developments on the XRPL blockchain.
Furthermore, integrating with cross-chain messaging services like Axelar is expected to extend XRPL-based DeFi solutions’ reach and utility across various blockchain ecosystems.
Ripple CTO and XRPL co-founder David Schwartz has shared insights on the AMM’s development journey since June 2022, emphasizing its role in enhancing the DEX’s order book system.
This integration is anticipated to offer optimal pricing by merging AMM and order book systems, while also providing liquidity providers with yield opportunities on their idle assets.
The introduction of liquidity pools for any asset pair issued on XRPL by the AMM aims at a broader user base, including high-volume traders and firms, despite not being specifically designed for institutional traders.
The lack of built-in compliance features in the AMM is seen as complementary to the DEX’s suitability for large financial institutions engaged in high-volume trading of popular tokens.
This new addition to the XRPL DEX is expected to create a more dynamic trading environment for a diverse range of participants, from retail investors to institutional players.
Efforts are underway to include on-chain regulatory compliance mechanisms to further facilitate institutional engagement with the protocol.
The collaboration between Ripple and the XRPL community in developing the AMM underscores the potential of cross-chain messaging protocols to attract investment, developers, and traders from across the blockchain spectrum, promising a more interconnected and efficient DeFi landscape.
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Goldman Sachs has seen a significant resurgence in client interest in cryptocurrencies this year, largely fueled by the U.S. approval of spot Bitcoin exchange-traded funds (ETFs).
According to Max Minton, the head of digital assets for Goldman Asia Pacific, a notable shift has occurred among the firm’s clientele, ranging from renewed activity to explorations into the crypto space.
This shift was detailed in a Bloomberg report dated March 24, highlighting the influence of the recent approval of ten Bitcoin ETFs in January on the traditional market’s embrace of cryptocurrencies.
Minton attributes this revived enthusiasm directly to the ETF approvals, stating, “The recent ETF approval has triggered a resurgence of interest and activities from our clients.”
He observed that the primary interest comes from existing Goldman clients, particularly through options and futures in the crypto domain, with hedge funds being the most engaged segment.
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Despite not offering spot crypto products and focusing on crypto derivatives like Bitcoin and Ether options and futures since launching its first crypto trading desk in 2021, Goldman Sachs reported a record $2.8 trillion in assets under management by the end of 2023.
Minton noted a quiet previous year but mentioned an uptick in client interest and activities, including onboarding and transactions, from the beginning of the year.
Clients of Goldman Sachs are leveraging derivatives to tap into the volatility of the cryptocurrency market and to speculate on future price movements.
Bitcoin-related derivatives have emerged as particularly popular among the firm’s active investors.
Furthermore, Minton speculated on the potential impact that the approval of a spot Ether ETF in the U.S. could have, potentially drawing institutional clients towards Ether, although Bloomberg ETF analysts currently estimate only a 35% chance of such an approval by May.
Despite regulatory challenges, Minton emphasized Goldman’s intention to broaden its client base to include asset management funds, banks, and specialized crypto asset firms, signaling a strategic expansion into the crypto market irrespective of immediate ETF developments.
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Bitcoin is on the verge of a supply crunch, according to recent insights from CryptoQuant’s “Weekly Crypto Report” dated March 26.
The analysis highlights a looming “sell-side liquidity crisis” as demand for Bitcoin surges, particularly influenced by the introduction of spot Bitcoin exchange-traded funds (ETFs) in the United States.
This increased demand, coupled with a dwindling supply, signals a pivotal shift in Bitcoin’s market dynamics, potentially altering its supply landscape irreversibly by the early months of 2025.
CryptoQuant’s report illuminates the stark reality of Bitcoin’s dwindling sell-side liquidity.
“Record Bitcoin demand paired with declining sell-side liquidity has resulted in the liquid inventory of Bitcoin plunging to the lowest ever in terms of months of demand,” the platform notes, estimating the current sell-side liquidity inventory can only satisfy the burgeoning demand for about twelve months.
The analysis focuses solely on “accumulating addresses,” which are wallets that have not made any outbound transactions, suggesting the actual demand could be even greater.
“This is only considering demand from accumulating addresses, which may be considered as the lower-end of Bitcoin demand,” CryptoQuant elaborates.
When examining Bitcoin’s availability strictly on United States exchanges, the timeframe during which supply can meet demand halves.
“The Bitcoin liquid inventory drops to six months of demand if we exclude the Bitcoin on exchanges outside the US.
“We exclude these exchanges considering that US spot Bitcoin ETFs will only source Bitcoin from US entities,” the report details.
Ki Young Ju, CEO of CryptoQuant, took to X (formerly Twitter) to discuss the emerging sell-side liquidity crisis.
He commented on the surprising activity of Bitcoins mined in 2010 and dormant since then, now moving to new wallet addresses.
Ju has been a vocal proponent of the ETF supply squeeze theory, previously forecasting a six-month window in mid-March as ETF inflows surged to record highs.
Although there was a brief period of net outflows from these products, recent trends suggest a reversal, with the latest figures from Farside, a UK investment firm, indicating significant net inflows of $400 million on March 25—the largest in two weeks.
This data underscores the growing investor interest in Bitcoin, even as the supply tightens, heralding a potentially transformative period for its market dynamics.
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AI startup Anthropic has decided not to accept investments from Saudi Arabia for the sale of an 8% stake in the company, originally purchased by Sam Bankman-Fried three years ago for $500 million.
This decision is made amidst the bankruptcy proceedings of FTX, and the stake, spurred by the booming interest in AI technologies, is now valued at over $1 billion.
The rejection of Saudi investments is attributed to national security concerns, particularly regarding the potential dual-use of technology for civilian and military applications, which could complicate matters with regulatory bodies like the Committee on Foreign Investment in the United States (CFIUS).
The sale, expected to finalize in the coming weeks, aims to use the proceeds to repay FTX customers.
The shares, classified as class B and lacking voting rights, are valued based on Anthropic’s latest $18.4 billion valuation.
Despite the company’s significant funding rounds totaling about $7 billion from tech behemoths such as Amazon, Alphabet, and Salesforce, the current transaction excludes these entities from the pool of potential buyers.
Instead, the sale is targeted towards a new investor syndicate through special purpose vehicles (SPVs), with venture firms being approached to participate.
Anthropic, known for its advanced language model competing with OpenAI’s ChatGPT, is led by founders Dario and Daniela Amodei.
READ MORE: SEC Delays Decision on Ether ETFs, Casting Doubt on Approval Odds Amidst Growing Skepticism
Although they have the right to vet investors, they are not directly involved in the ongoing sale discussions.
Their acquaintance with Bankman-Fried was facilitated by a mutual interest in “effective altruism,” aimed at leveraging wealth for charitable causes.
While rejecting Saudi Arabian funds, Anthropic is open to investments from other sovereign wealth entities, including the UAE’s Mubadala, which is reportedly considering an investment.
The marketing of FTX’s stake is managed by Perella Weinberg.
Saudi Arabia’s sovereign wealth fund, the PIF, with assets over $900 billion, continues its aggressive technology sector investments, including talks with Andreessen Horowitz for creating a $40 billion AI-focused fund.
These moves align with Crown Prince Mohammed bin Salman’s “Vision 2030 Initiative” to diversify the nation’s economy beyond oil, including investments in global tech companies, sports leagues, and enhancing international financial relationships.
This backdrop adds complexity to Anthropic’s decision, especially as Saudi Arabia seeks to strengthen its tech capabilities amid growing ties with China.
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