Weekly Report (April 24)
Bitcoin and the Halving
As previously mentioned, the Bitcoin halving took place on Saturday the 20th of April, which saw the reward for mining a block halved from 6.25 BTC to 3.125 BTC. However, on that day, users were willing to pay a record $2.4 million in transaction fees on the Bitcoin network. This indicates that there was extremely high demand for Bitcoin transactions around the halving event, as users competed to have their transactions included by paying higher fees. Furthermore, Bitcoin mining revenue soared by 200% in the wake of the trading frenzy around Bitcoin Runes. This increased activity and demand for Bitcoin transactions pushed the transaction fees higher than the block rewards for miners for the first time. The combination of reduced block rewards and record-high transaction fees suggests that the Bitcoin ecosystem was experiencing a period of heightened interest and usage around the halving event
The Halving has created a lot of bullish sentiment in the market as this historically marks the beginning of a bull cycle. Bitcoin is up over 11% from its weekly lows and is trading around $66,600 USD
Bitcoin Weekly Price Chart
Runes Launch: What Are They
On the day of the Bitcoin halving, Runes protocol was launched with the aim to open up new possibilities and drive innovation within the Bitcoin decentralised finance (DeFi) sector.
Runes is an innovative protocol that allows for the easy creation and transfer of fungible tokens directly on the Bitcoin blockchain. Unlike previous token standards such as BRC-20, Runes is designed to seamlessly integrate with Bitcoin's existing transaction model (UTXO) in a more streamlined and effective manner. Transactions using Runes involve encoding special instructions within Bitcoin transactions to either issue new tokens known as "runes" or to transfer existing ones. This protocol aims to reduce blockchain congestion while enabling runes to have unique characteristics.
BlackRock tokenises Money Market Fund on Hedera
BlackRock, the world's largest asset manager, has tokenised one of its money market funds on the Hedera blockchain network. This means they have created digital tokens representing shares in the fund, which can be traded and transferred more efficiently using blockchain technology. This is a major development in the real-world assets (RWAs) industry and comes after abrdn tokenised its MMFs on Hedera last year. This move by major financial institutions signals growing adoption of blockchain and decentralised finance solutions within traditional finance, as the tokenisation can provide benefits like faster settlement, increased liquidity, and potential for fractional ownership of assets.
After this news Hedera's native token HBAR shot up over 100%. Since the news it has retraced to $0.144 which is still marks a 80% gain on the weekly.
Bitcoin ETF Flows
Bitcoin ETFs have recently broken a trend of negative net flows, showing positive net inflows over the past three trading days. Meanwhile, the average outflow from Grayscale's Bitcoin Trust (GBTC) has continued to diminish, now standing at around $237 million, suggesting that selling pressure from this particular ETF is easing.
In a span of seven trading days from April 12th to April 22nd, Bitcoin ETFs have seen a trading volume of $16.4 billion. The recent downturn in the market has significantly influenced investor behavior, leading to this decrease in volume. Heightened fear and uncertainty have made many investors more cautious, resulting in reduced activity in the market during this period.
The CEO of Bitwise has predicted that wealth management firms will likely increase their holdings in Bitcoin ETFs, signaling a growing interest in cryptocurrency investments from traditional finance sectors. This anticipated rise in adoption is expected to gain further momentum following the completion of the Bitcoin halving event, which historically has had a significantly positive impact on Bitcoin's value and investor interest.
Additionally, IBIT, which is Blackrocks Bitcoin ETF, has been experiencing rapid growth. Larry Fink has described it as "the fastest growing ETF in the history of ETFs." IBIT is on track to surpass Grayscale which has been in the game for a lot longer.
Bitcoin ETF Flow Table (US$m)
