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PLUS: Another Record Day
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We’re the crypto newsletter that won't warp your reality like a mind-bending journey through dreams within dreams... 💤🌀
What we’ve cooked up for you today…
🕺 Grayscale’s making moves
🤔 Trump endorses Bitcoin
⚖️ HODLer dynamics
🤑 And more…
MARKET WATCH ⚖️
Prices as at 6:25am ET
Only the top 20 coins measured by market cap feature in this section
GRAYSCALE’S MAKING MOVES 🕺
BREAKING: Grayscale introduces ‘mini’ Bitcoin ETF to alleviate investor tax burdens and curb outflows
On March 12, Grayscale filed for a spin-off of its Bitcoin ETF.
The Grayscale Bitcoin Mini Trust will trade under the stock ticker BTC. (pretty baller move securing that ticker)
This spin-off is intended to offer investors lower fees.
And as you know, Grayscale’s fees are currently at 1.50%.
That’s WAY more than the other Bitcoin ETF issuers are charging.
(BlackRock fees are 0.20% as an example)
As a result of these high fees, they’ve experienced capital outflows of, wait for it…
~$11 billion to date. 🤯
Now, you’re probably wondering:
What does any of this even mean? How does a spin-off ETF work?
Well lucky for us, ETF analyst James Seyffart explained how all of this works.
Why don’t they just lower GBTC fees to be competitive?
Grayscale relies on these fees for revenue.
If they reduced their fee from 1.5% to 0.20% - that would be an 86% reduction in revenue.
That’s a pretty big hit to take.
Although you could also argue that if they lowered their fees they wouldn’t be bleeding as much Bitcoin as they currently are…
How does an ETF spin-off work?
If approved, a spin-off percentage will be determined.
As an example assume the spin-off percentage is 30%
If an investor has $1000 of GBTC, once the spin-off occurs, they will end up with $300 of the new mini-ETF and $700 of GBTC.
The spin-off percentage has not been announced yet.
In summary, Seyffart had this to say:
“First impression is that it’s a nice middle ground between helping out customers and not decimating their revenue. Need to see the %’s and fees still though.”
ETF analyst, Eric Balchunas also shared his thoughts on the situation.
It may sound a little strange, but according to ETF analysts its a smart move from Grayscale.
Although the intended fee of the spin-off ETF is still unknown.
As well as the expected launch date. (It could be a while before we see this)
In other ETF news…
Yesterday was the BIGGEST day yet with net inflows of over $1 billion.
BlackRock alone had net inflows of $849 million.
Do you realise how insane that is?
And, we’re only just getting started…
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TRUMP ENDORSES BITCOIN 🤔
You won’t believe this…
Trump has pulled a 180 on crypto.
In his latest interview, Trump suggested that he would not crack down on Bitcoin as president.
But to be clear, he’s still a long way from becoming a Bitcoin maxi…
Appearing on CNBC, Trump was asked his opinion on Bitcoin.
This is what he had to say:
“Sometimes we’ll let people pay through Bitcoin… If you think of it, it’s an additional form of currency… It has taken on a life of its own.”
Trump then proceeds to ramble on about his recent limited edition sneaker drop.
However, he explains that he was surprised by the amount of people that paid for these sneakers with Bitcoin.
Trump also denied purchasing any Bitcoin for himself.
He still prefers the dollar:
“I’m a traditionalist, I like staying with the dollar. I hate when countries go off the dollar. I would not allow countries to go off the dollar. When we lose that standard, that will be like losing a revolutionary war.”
Over the years, Trump has been warming up Bitcoin.
Back in 2021, he famously labelled Bitcoin a “scam” and that it threatens the US dollar.
In complete contrast, Trump closed out the interview with the following:
“I have seen, there has been a lot of use of that [crypto], and I’m not sure that I’d want to take it away at this point.”
Now we’re not here to pick sides in the presidential election.
The key point here is that a presidential candidate is now actively endorsing Bitcoin on live TV.
That’s huge. 😎
HODLER DYNAMICS ⚖️
Today we’ll be taking a look at Bitcoin’s HODLer dynamics.
Here’s how this metric works:
🔴 Short-Term Holders (STHs): coins that have been held for less than 155 days
🔵 Long-Term Holders (LTHs): coins that have been held for more than 155 days
Keep in mind, exchange balances are excluded from LTH & STH calculations.
The LTH supply has decreased by 660k BTC since it’s peak of ~15,000,000 in November 2023.
As a result the STH supply has increased by 810k BTC over the same period.
Where’d that extra 150k BTC come from?
Here’s how it’s calculated:
660K BTC came from Long-Term Holders selling
150K BTC withdrawn from exchange balances
BUT, Glassnode notes that ~57% of this decline in LTH supply can be attributed to Grayscale GBTC outflows.
An interesting point to note here is that the amount of LTHs every cycle continues to rise.
Conversely, the amount of STHs every cycle continues to decrease.
Meaning long-term conviction in Bitcoin is getting stronger ever cycle.
And there’s less supply available for sale.
CRACKING CRYPTO 🥜
Coinbase challenges SEC in court over 'arbitrary and capricious' rule making rejection. Coinbase criticizes SEC's decision on rulemaking petition, calling it arbitrary and capricious.
Coinbase announces offering of $1B in convertible notes. Coinbase stock jumped 18% in the past week after bitcoin notched new all-time highs and US bitcoin ETFs continued to beat records.
Global banks participate in large-scale blockchain pilot test. The pilot test included financial behemoths such as Goldman Sachs, BNY Mellon and Cboe Global Markets.
WHAT WE’RE READING 📚
Want to get even smarter? Check these out.
p.s. all completely FREE
CAN YOU CRACK THIS NUT? ✍️
Select your answer below and you’ll be redirected to the results page. (answer explanation can be found after “Meme Corner”)
Which newly launched Bitcoin ETF currently has the largest BTC holdings?(excluding Grayscale's GBTC) |
MEME CORNER 😂
Because what would the crypto world be without its share of memes?
Trivia Answer: A) BlackRock 🥳
BlackRock currently holds 203,755 Bitcoin, the most out of the newly launched ETFs.
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DISCLAIMER: The content of this newsletter is not financial advice. This newsletter is strictly educational and is not investment advice. Please be careful and do your own research.
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