Following its surge to new all-time highs this week, bitcoin exhibited signs of weakness overnight, experiencing a sharp decline of 10% to dip below $66,000. Earlier in the week, BTC shrugged off concerns over the unexpected 3.2% rise in the US CPI for February, which might hinder the Federal Reserve’s inclination to initiate rate cuts. Prior to 2024, market projections had anticipated approximately five or six rate cuts in 2024, with expectations of the first cuts starting as early as the Federal Reserve’s upcoming March meeting. However, robust economic expansion coupled with inflation figures surpassing the Fed’s 2% target have dampened these expectations.
In crypto markets, the meme coin rally had continued throughout the week, spearheaded by dogwifhat (WIF), but also came to a halt today amid BTC’s correction. On Thursday, the meme coin market witnessed a rapid surge, with a staggering 9% increase in market cap within a 24-hour period, significantly outperforming other cryptoassets. The top five meme coins now collectively represent around 35% of the nearly $60 billion meme coin market capitalization, according to CoinGecko data. Against this backdrop, Solana (SOL) – home to many multi billion meme coins such as WIF and BONK – hit a new milestone as its market cap rose to $81 billion on Friday morning, surpassing its previous peak in November 2021.
Speaking of market cap, Bernstein analysts have forecasted a potential surge of nearly 200% in the overall cryptocurrency market capitalization, estimating it to reach $7.5 trillion by the end of 2025. They attribute this projected growth to the “unprecedented” adoption of crypto by institutional investors. Elsewhere, digital asset investment products have surpassed $100 billion in assets under management (AUM) for the first time in history, according to CoinShares. This milestone was reached shortly after global crypto funds broke the inflow record for 2021, occurring within the first three months of 2024.
In crypto ETFs, Bloomberg analysts Erich Balchunas and James Seyffart have lowered the likelihood of an spot Ethereum ETF approval in May to 30%, down from the previously estimated range of 60-70%. Seyffart remarked on X, “This Ethereum ETF cycle feels like the opposite of Bitcoin ETF approval odds at the moment. The more we see/hear (and don’t see/hear), the less optimistic I become.” In another significant development, Ethereum’s Dencun hard fork, considered by many developers to be its most substantial upgrade since the Merge, was activated on the Ethereum mainnet on Wednesday. Focused on scalability, Dencun introduces EIP-4844 or Proto-Danksharding, which establishes a dedicated data channel on Ethereum for layer-2 data, thereby significantly reducing transaction fees on layer 2s or rollups.
Market Overview
The global cryptoasset market capitalization currently amounts to roughly $2.72 trillion – little changed from Friday last week, with bitcoin accounting for about 49.3%. Among the Top 30 cryptoassets by market cap, Toncoin (TON) outperformed, gaining about 38.5% over the week. The price of bitcoin (BTC) sits at $68,175, unchanged compared to the same time last week while the price of ether (ETH) decreased by 5.7% to $3,688. The total value locked (TVL) in DeFi is sitting at $98.5 billion, with Ethereum (excluding Layer 2s) accounting for about 57% of TVL.
This Week’s Headlines
- Craig Wright is not Satoshi, didn’t author Bitcoin whitepaper, UK judge rules
- Ethereum’s Dencun upgrade activated on mainnet, introduces “blobs” to reduce Layer 2 transaction costs
- Dencun upgrade on Ethereum leads to a major reduction in transaction costs on Layer 2s
- Bloomberg analysts substantially lower likelihood of spot Ethereum ETF approval in May to 30%
- Donald Trump says he has “fun” with crypto, bitcoin is an “additional form of currency”
- Coinbase sells $1 billion in convertible senior notes
- MicroStrategy to offer an additional $600 million in convertible senior notes
- BlackRock plans to acquire spot Bitcoin ETPs for Its Global Allocation Fund
- $190B wealth manager Cetera greenlights 4 bitcoin ETFs for allocators
- Solana memecoin dogwifhat to grace Las Vegas skyline after $650,000 raise
- Leading NFT collections such as BAYC experience major drop in floor prices amid NFT market downtrend
Notable Deals and Fundraising
- Binance spins off $10 billion venture arm Binance Labs which has invested in over 200 crypto projects
- Layer 1 blockchain Monad Labs eyes $200 million raise, led by Paradigm
- Berachain raises $69 million in latest funding round, Bloomberg reports
- Layer 2 developer Eclipse Labs raises $50 million in Series A funding ahead of expected Q2 mainnet
- zkBridge developer Polyhedra Network raises $20 million at a valuation of$1 billion in token round
- ClearToken raises $10 million from institutional investors including Nomura’s Laser Digital
- D2X crypto derivatives trading platform raises $10 million in Series A fundraise
- MMO-gaming platform MetaCene raises $10 million in a funding round
- Modular network project Elixir raises $8 million in a Series B round
- NFT lending protocol NFTfi raises $6 million in series A1 funding
- MadWorld mobile NFT shooter raises $11 million and launches in early access
- Bluwhale raises $7 million to bring AI to blockchain, supercharging dApps to reach wallet holders with rewards
- MetalCore crypto video game developer raises $5 million in a new funding round
- Fjord raises $4.3 million to connect early-stage Web3 projects with engaged backers
- Arbitrum eyes $400 million crypto gaming fund with proposal to DAO
