2024-02-27 12:03

Coinbase premiums for ether (ETH) tokens were higher than usual in the past week, suggesting demand was led by U.S. investors, CryptoQuant said. U.S. investors are the primary drivers of the recent 11% rally in ether (ETH) prices, as indicated by the "Coinbase premium" metric, which shows a spike in demand from the U.S.-based Coinbase exchange preceding the price jump. The anticipation of a possible spot ether exchange-traded fund (ETF) in the U.S. has sparked further buying demand for the asset in the region, with experienced traders ramping up exposure to ETH since January. Ether's 11% rally in the past week was spurred by buying pressure in the U.S., data from CryptoQuant that tracks local exchange activity shows. A spike in demand from the regulated exchange Coinbase (COIN), most prominent in the U.S., preceded a jump in ether (ETH) prices, according to the "Coinbase premium," an indicator showing the gap between Coinbase's ETH/U.S. dollar pair and Binance's ETH/USDT pair. "The recent Ethereum price action was driven by the US demand," CryptoQuant's head of marketing, Ho Chan Chung, said in a Telegram message. "We can clearly see that the Coinbase has triggered the upward movement with the premium index." The metric is starting to rise again, suggesting a sign of more price gains in the coming weeks. While Coinbase is more popular among crypto traders in the U.S. and Europe, Binance, which started in China, is among the most popular exchanges among traders in Asia. Anticipation of approval for a possible spot ether exchange-traded fund (ETF) in the U.S. may have sparked buying demand for the asset in the region. Experienced and profitable traders first started ramping up exposure to ETH in January. While interest in ether bets has risen significantly, an ETF could create sustained rather than explosive growth for the second-largest cryptocurrency by market value, some traders said. As of Tuesday, Franklin Templeton, BlackRock, Fidelity, Ark and 21Shares, Grayscale, VanEck, Invesco and Galaxy, and Hashdex had submitted applications for an ether ETF. ETH has gained 6.5% in the past 24 hours, while the CD20 gauge of the broader market has added 8.1%. https://www.coindesk.com/markets/2024/02/27/ether-demand-is-driven-by-us-investors-data-shows/

2024-02-27 11:22

Total market cap of Circle's USDC has increased faster than that of larger rival Tether's USDT in recent months, the report said. USDC supply has increased by over 14% since the start of December. The increase in liquidity is a sign of fresh capital inflows following the launch of spot bitcoin ETFs in the U.S. The stablecoin's presence is growing in non-U.S. markets. Circle's USDC, the second-largest stablecoin by market cap, is making a comeback, with liquidity increasing worldwide and usage growing rapidly outside the U.S., leading to a sharp increase in supply in recent months, Coinbase (COIN) said in a research report on Monday. “The supply of USDC has increased by 14.3% or over $3.5B since December 1, 2023, taking its total market cap to $28B compared to a smaller 8.7% growth for USDT over the same period,” analysts David Duong and Li Liu wrote. USDT is Tether's rival dollar-based stablecoin and is by far the largest, touting a $98 billion market cap. USDC's increase in liquidity reflects the “overall pickup in both retail and institutional demand as crypto has moved into a new phase of its market cycle after the launch of spot bitcoin ETFs in the U.S., contributing to fresh capital inflows,” the authors wrote. A stablecoin is a type of cryptocurrency that’s typically pegged to the U.S. dollar, though some other currencies and assets such as gold are also used. USDC is also building a larger presence in non-U.S. markets, the report said, noting that the stablecoin has increased its share of spot and derivatives activity fivefold, albeit to only 4% of total centralized exchange volumes (CEX) globally. As well as the spot ETF catalyst, the growth in liquidity was driven by the start of Coinbase's international exchange and the relisting of USDC trading pairs on rival exchange Binance late last year, the report added. USDC is issued by Circle, which is itself backed by Coinbase. Read more: Stablecoin Market Cap Hits $140B, Highest Since 2022 Amid USDC Resurgence, Tether Growth https://www.coindesk.com/markets/2024/02/27/stablecoin-usdc-is-making-a-comeback-coinbase/

2024-02-27 08:51

Senators Ted Cruz, Bill Hagerty, Rick Scott, Ted Budd and Mike Braun filed a bill titled "The CBDC Anti-Surveillance State Act." Republican senators have introduced legislation aimed at blocking a CBDC in the U.S. The lawmakers say the "Biden administration salivates at the thought of infringing on our freedom and intruding on the privacy of citizens to surveil their personal spending habits ..." Republicans have tried to introduce such legislation several times in the past. Yet again, Republican lawmakers have introduced legislation to block efforts to introduce a central bank digital currency (CBDC) in the U.S. on concerns a digital dollar would impinge on personal privacy. On Monday, U.S. Sen. Ted Cruz (R-Texas), joined by Sens. Bill Hagerty (R-Tenn.), Rick Scott (R-Fla.), Ted Budd (R-N.C.), and Mike Braun (R-Ind.), filed legislation titled "The CBDC Anti-Surveillance State Act." "The Biden administration salivates at the thought of infringing on our freedom and intruding on the privacy of citizens to surveil their personal spending habits, which is why Congress must clarify that the Federal Reserve has no authority to implement a CBDC," Cruz wrote in a post on his website. CBDCs have become a presidential election issue or at least a campaign talking point, even though President Joe Biden's administration has not made any declaration on the topic. The Federal Reserve would be the issuing institution, and is only in the basic research phase. Fed Vice Chairman for Supervision Michael Bar has said the Fed won't take a step forward without signoff from the White House and an authorizing bill from Congress. Former President Donald Trump, the front-runner in the Republican leadership race, has promised to ban the creation of a CBDC. In September 2023, at least one Democrat, Rep. Stephen Lynch (D-Mass.) reintroduced a bill calling for a digital dollar pilot explaining that "Russia, China, and nearly 130 countries worldwide already researching and launching some form of CBDCs," and thus it is "absolutely critical" for the U.S. to take this step. Republicans have tried to head off a CBDC on several occasions, including the Digital Dollar Pilot Prevention Act pushed by Rep. Alex Mooney (R-W.V.), Rep. Tom Emmer's (MN-06) CBDC Anti-Surveillance State Act, and Ted Cruz's first legislation against a CBDC. Read More: Trump: Bitcoin Has Taken on 'a Life of Its Own,' Will Probably Need Some Regulation https://www.coindesk.com/policy/2024/02/27/republican-lawmakers-introduce-legislation-to-ban-a-cbdc-in-the-us-again/

2024-02-27 04:58

A market observer said that bitcoin and crypto markets will enter an “unprecedented phase of adoption” as prices eventually breach lifetime peaks. Bitcoin’s price rally has shaken out leveraged bearish bets. Analysts said the cryptocurrency is a new bull market and poised to rally ahead of the impending mining reward halving. Leveraged bets against bitcoin (BTC) lost over $150 million in the past 24 hours as prices rallied 10% for the biggest daily gain since October, spurring calls for a firm new bull market. BTC briefly topped the $57,000 level early Tuesday to reach its highest price since November 2021 on the back of multiple catalysts, such as rising volumes on spot bitcoin exchange-traded funds (ETF) and institutional buying. Covering shorts may have contributed to the asset’s strength since the start of this week. Data from CoinGlass show short bets have lost over $180 million since Sunday. Still, open interest jumped from $48 billion to nearly $54 billion – showing a rise in bullish bets as traders expected volatility. Liquidation is when an exchange forcefully closes a trader’s leveraged position due to a margin shortfall. It happens when a trader lacks sufficient funds to keep the trade open. Large liquidations can signal the local top or bottom of a steep price move, which may allow traders to position themselves accordingly. The bitcoin bump buoyed the broader crypto market. Ether (ETH), Solana’s SOL and Cardano’s ADA rose 8% in the past 24 hours, while Stacks (STX) – a bitcoin layer-2 token – spiked over 25%. Market observers said bitcoin is firmly in a “new bull market” and could see a significant upside as the anticipated halving event approaches. “Bitcoin’s decisive rally signals the de facto start of a new bull market,” said Alex Adelman, founder at Lolli, in an email to CoinDesk. “Major price movements are being driven by sheer positive market sentiment and persistent bitcoin ETF inflows, which reached new daily highs with the day’s rally.” “With the bitcoin halving just over a month away, which historically brings price increases, tremendous upside lies ahead for bitcoin,” Adelman added. Halving is part of the Bitcoin network’s code to reduce inflationary pressure on the cryptocurrency and will cut the rewards in half for successfully mining a bitcoin block. This makes obtaining or mining new bitcoin much harder and has historically preceded bull runs. https://www.coindesk.com/markets/2024/02/27/bitcoin-shorts-lose-150m-as-btc-poised-for-tremendous-upside/

2024-02-27 04:57

One observer said that elevated funding rates offer crypto hedge funds exceptionally attractive arbitrage opportunities. A spike in bitcoin funding rates suggests the leverage is skewed on the bullish side. One observer said elevated funding rates offer crypto hedge funds exceptionally attractive arbitrage opportunities. There seems to be no stopping the bitcoin freight train. That’s driving the cost of holding leveraged bullish bets in perpetual futures skywards, creating an attractive arbitrage opportunity for non-directional traders. Early Tuesday, bitcoin (BTC) rose nearly to $57,000, the highest since late 2021, taking the year-to-date gain to 32%, CoinDesk data show. The CoinDesk 20 index, a broader market gauge, traded nearly 6% higher. The annualized funding rate in bitcoin perpetual futures listed on Binance surpassed 100% for the first time in at least a year, according to data source Velo Data and CoinGlass. Funding rates on Bybit and Deribit rose to 95% and 56%, respectively. Perpetuals or futures with no expiry use funding rates to keep prices for perpetuals in sync with the spot prices. A positive funding rate indicates that perpetuals are trading at a premium to the spot price and requires traders holding long or buy positions to pay a fee to those holding short positions. Exchanges collect funding every eight hours. In other words, a positive and rising funding rate indicates a bullish mood in the market or that the leverage is skewed bullish. Markus Thielen, founder of 10X Research, said the rising funding rates likely stem from traders taking bullish bets in anticipation of continued inflows into the U.S.-based spot ETFs. “The perp funding rates are exploding, while open interest keeps climbing, now at $14.4 billion,” Markus Thielen, founder of 10X Research, who predicted bitcoin’s rise to $57,000, said. “Traders are becoming increasingly confident that the halving and the ETF inflows will be bullish.” Thielen added that the surge in funding rates means non-directional traders or arbitrageurs stand to make an attractive return. Arbitrage involves profiting from price discrepancies between the two markets. An elevated funding rate means perpetuals are trading at a significant premium to the spot price. An arbitrageur, therefore, can short perpetual futures and buy the cryptocurrency in the spot market, pocketing the premium while bypassing the price volatility risks. “Elevated perpetual futures funding rates are providing crypto hedge funds with exceptionally high arb spreads. BTC and ETH are trading at 20% and 30% or even higher, and this is the sweet spot for ARB books. In this market, everybody wins, the guys that are outright long and the guys that are playing the perp spread. A wonderful time to be in crypto!” Thielen told CoinDesk. https://www.coindesk.com/markets/2024/02/27/bitcoin-funding-rates-jump-to-100-sparking-opportunity-for-savvy-traders/

2024-02-27 02:27

The spot ETFs posted record volumes on Monday as bitcoin gained 6% during U.S. trading hours. Following sizable gains during the U.S. day on Monday, bitcoin (BTC) pushed through several additional round number milestones during early Tuesday morning Asia hours, the price topping $57,000 for the first time since November 2021. At press time, bitcoin had pulled back a hair to $56,500, still ahead more than 9% over the past 24 hours. The broader CoinDesk 20 Index (CD20) was ahead 8.9% over the same time frame. The rally began Monday morning in the U.S., with bitcoin taking out $53,000, also for the first time since November 2021. The price rose above $54,000 later in the day. During the U.S. evening/early Asia morning, things got very active again, with bitcoin taking out the $55,000, $56,000 and $57,000 levels in the space of a few minutes. The move higher in bitcoin earlier Monday spurred sizable activity in the U.S.-based spot bitcoin ETFs, with the group (ex-Grayscale's GBTC) posting a record-high $2.4 billion in trading volume on Monday, according to Bloomberg. As for GBTC, it saw its smallest one-day outflow of bitcoin since the Jan. 11 launch of the spot ETFs, the fund shedding just 921 tokens. https://www.coindesk.com/markets/2024/02/27/bitcoin-tops-57k-as-rally-picks-up-steam/