Market Highlights
- The U.S. Government’s stablecoin bill passed the U.S. Senate Banking Committee.
- A bill introduced in the U.S. Senate would allow the Government to buy one million BTC.
- An IRS rule that expanded financial services regulations to DeFi was rescinded.
- Ripple secured approval from the Dubai Financial Services Authority to enter the UAE.
- Binance secured a $2 billion investment from AI and technology investment firm MGX.
Markets Overview
Macro Market Updates:
Macroeconomic uncertainty continued in traditional finance markets this week due to the ongoing risks posed by President Trump’s tariffs and potential retaliatory measures from the European Union. In economic data, the U.S. consumer price index (CPI) for the 12 months ending 28 February 2025 came in just under forecast at 2.8%. While it’s a minor step closer to the Fed’s 2% target, it’s not expected to be enough for the U.S. Federal Reserve to cut rates in its March meeting, given the persistent uncertainty across markets. The Bank of Canada joined other central banks this week and cut its overnight rate by 25 basis points to 2.75%.
Friday, 14 March, saw a rally in risk assets as U.S. Senate Minority Leader Chuck Schumer (D-NY) said he’d vote for the Republican’s measure to fund the government and avoid a shutdown. This week, the S&P 500 closed down about 1.2%, the NASDAQ was down 2.4%, and the Dow Jones Industrial Average was down 2.4%.
As the new week begins, traders and investors are likely hesitant in the lead-up to the U.S. Federal Reserve’s next rate decision on Wednesday, 19 March. The Bank of Japan’s decision is tentatively scheduled for the same day. On Sunday evening in the U.S., futures for the major indexes were down, signalling that investors expect more volatility this week.
Crypto Market Sector Performance
This week marked the first in recent weeks where most sectors experienced growth. Bridge, gaming and DePin saw the largest gains. LayerZero (SRO) led the growth in bridging projects, with an increase of 52% on the week (more on that below). In data availability, Echelon Prime led the way, gaining 55%. The gains seen across market sectors this week indicate that some altcoins may be seeing some bullish momentum following the recent sell-off and consolidation period.
Bitcoin (BTC)
Bitcoin saw minor gains this week, presumably due to regulatory developments and news that the U.S. Government allegedly plans to buy more bitcoin, as attendees of a closed-door crypto roundtable said. Opening the week at US$80,708, bitcoin declined to a low of US$76,555 on Tuesday, 11 March, before climbing upwards to finish the week. Bitcoin is currently trading at US$83,904 an increase of 5.7% on the week.
The specifics of how the U.S. Government will accumulate and hold bitcoin were further unveiled this week through two new bills. Senator Cynthia Lummis (R-WY) introduced the BITCOIN Act in the U.S. Senate. If passed, the Act would authorise President Trump to buy one million bitcoin to add to the country’s strategic bitcoin reserve. In the House of Representatives, Byron Donalds (R-FL) introduced legislation to enshrine President Trump’s proposed strategic bitcoin reserve in law.
Bitwise launched a new bitcoin exchange-traded fund (ETF) this week. The Bitwise Bitcoin Standard Corporations ETF (OWNB) gives investors exposure to publicly traded companies that hold more than 1,000 bitcoins. Holdings across the ETF are weighted based on the amount of bitcoin each company owns.
YouTube rival Rumble started buying bitcoin this week as part of its strategy to use US$20 million of excess reserves to add bitcoin to its treasury. The company bought 188 bitcoins, valued at US$17.1 million at the time of purchase. Rumble’s average purchase price is US$91,000 per bitcoin.
Mining company Bitdeer released an investor statement this week outlining how its BTC holdings had increased by 75% since the start of the year. Some of the company’s growing holdings are attributed to self-mining. Bitdeer’s self-mining activities produced 110 bitcoin for the company in February.
Bitcoin asset investment products saw outflows of US$978 million this week. Short-bitcoin saw outflows of US$3.6 million. The recent streak of outflows across bitcoin asset investment products has seen gold exchange-traded funds (ETFs) takeover with almost US$150 billion assets under management (AuM), while bitcoin ETFs currently have around US$93 billion AuM. Recent macroeconomic uncertainty has seen the price of gold appreciate while bitcoin has traded in closer correlation to other risk assets such as equities.
Past performance is not a reliable indicator of future results.
Ethereum (ETH)
This week, Ethereum made minor gains. Opening the week at US$2,020, the cryptocurrency declined to a low of US$1,754 and has since traded sideways around US$1,900. No specific events point to Ethereum’s further sell-off this week, though widespread uncertainty across the markets is presumably the culprit.
The Pectra upgrade, the biggest Ethereum upgrade since The Merge in 2022, has entered a new phase of testing. Pectra aims to offer more staking flexibility and improve network scalability. A testnet named Hoodi will be launched on Monday. If Hoodi goes well, Pectra could hit the mainnet as soon as April.
Ethereum asset investment products saw outflows of US$175 million this week.
Ethereum is currently trading at US$1,938, an increase of 3.6% on the week.
Past performance is not a reliable indicator of future results.
Altcoins
Smart contract gains
- Viction (VIC) gained 56%, taking its market cap to US$34.4 million. The layer-1 blockchain gained almost 130% across Tuesday and Wednesday before declining. The gains are presumably due to Binance Futures listing USD-margined VIC perpetual contracts, allowing traders to contract with 75x leverage.
- Neon (NEON) grew by 37%. This takes its market cap to US$40.9 million. The Ethereum virtual machine (EVM) decentralised app integration launched a new quest on Intract HQ, which enables users to complete steps and unlock rewards. NEON gained almost 80% on the news before retracting.
- Toncoin (TON) gained 41%, which takes its market cap to US$8.6 billion. The gains are presumably due to Telegram Founder Pavel Durov being approved to leave France following his detainment that started in August 2024. French authorities accused Durov of running a messaging platform that enabled illegal activities.
- LayerZero (SRO) grew by 56%, taking its market cap to US$258 million. The interoperability protocol saw gains across the weekend, presumably due to an X Spaces focused on stablecoins that the team hosted on Friday, 14 March, which coincided with the U.S. Government’s stablecoin bill being passed through the U.S. Senate Banking Committee.
Fraxtastic
- Frax Share (FXS) gained 49%, which takes its market cap to almost US$170 million. The governance and collateral token in the Frax Finance ecosystem gained over the weekend, presumably due to a wider market rebound and the team announcing that it had joined the Superstate Industry Council, which drives the adoption of tokenisation across the traditional finance and crypto markets.
Let them eat pancakes
- PancakeSwap (CAKE) grew by 76%, taking its market cap to US$606 million. The decentralised exchange declined to start the week and then saw a run of almost 60% from its weekly low of US$1.38. The majority of the gains were seen over the weekend after the team announced that it had added a maximum extractable value (MEV) Guard to protect swaps from MEV attacks.
Past performance is not a reliable indicator of future results.
In Other News
This week marked a fifth consecutive week of outflows for digital asset investment products, with US$1.7 billion leaving funds. The recent sell-off across markets has seen a total of US$6.4 billion of outflows. Year-to-date inflows remain positive at US$912 million. The U.S. accounted for most of the outflows this week, with almost US$1.2 billion leaving funds.
In altcoins, Solana and XRP saw outflows of US$2.2 million and US$1.8 million, respectively. Binance also took a hit, with its assets under management declining to US$15 million following a seed investor exit.
Other crypto news
- Ripple is expanding to the United Arab Emirates (UAE) as it secured approval from the Dubai Financial Services Authority (DFSA) to enter the market. This development makes Ripple the first payment provider to be licensed to operate in the Middle East. The UAE’s cross-border payments market is worth US$40 billion. The Ripple-linked crypto, XRP, has been approved for licensed firms to integrate into their services since November 2023.
- Binance secured a $2 billion investment from Abu Dhabi-based AI and technology investment firm MGX. The investment, paid in stablecoins, marks the first institutional investment in Binance and the largest for a crypto company to date. About 20% of Binance’s 5,000-person staff is based in the UAE.
- In ETF news, the Cboe filed this week for a rules change with the U.S. Securities and Exchange Commission (SEC), enabling the exchange to list Franklin Templeton’s Solana ETF. The SEC’s 240-day decision period will begin once it acknowledges the Cboe’s submission. Also this week, the SEC delayed its decision on Grayscale’s XRP ETF application, stating it needed a longer period of time for consideration. Franklin Templeton, Canary Capital, WisdomTree, Bitwise, Coinshare and 21Shares all have XRP ETF applications awaiting approval. The SEC’s delay could push decisions on all XRP ETFs back to October.
Regulatory
- The U.S. House of Representatives voted to overturn a Biden administration IRS rule that expanded the compliance requirements applied to traditional financial services firms to DeFi. These requirements would have mandated that DeFi projects collect and report taxpayer information. 76 Democrats crossed the floor to provide bipartisan support in the vote.
- The GENIUS Act, the U.S. Government’s stablecoin bill, has passed through the U.S. Senate Banking Committee by a vote of 18-6. Five Senate Democrats joined Republicans to pass the bill through the committee. The bill will now go to a full vote on the Senate floor by the end of April. If passed, stablecoin issuers will be able to choose between state or national charters so nonbank issuers can participate in the U.S. market.
- The state of Vermont has dropped its case against Coinbase over its staking services. This development follows the U.S. SEC dropping its case against Coinbase. Vermont regulators and ten other states issued a “show cause order” to Coinbase in June 2023. The order accused Coinbase of violating securities laws in offering staking services without registration.
Disclaimer: This assessment does not consider your personal circumstances, and should not be construed as financial, legal or investment advice. These thoughts are ours only and should only be taken as educational by the reader. Under no circumstances do we make recommendation or assurance towards the views expressed in the blog-post. Past performance is not a reliable indicator of future results. The Company disclaims all duties and liabilities, including liability for negligence, for any loss or damage which is suffered or incurred by any person acting on any information provided.
from Caleb & Brown Cryptocurrency Brokerage.
