What happened this week around blockchain and cryptocurrencies? The most relevant local and international events as well as appealing background reports in a pointed and compact weekly review.
Selected articles of the week:
In recent years, various US fund issuers have been striving to introduce the first Ether (ETH) ETF to the market. However, despite the approval of multiple Bitcoin ETFs in October 2021, the US Securities and Exchange Commission (SEC) has so far hindered all applications; a situation that might change in the coming months. Numerous applicants have resubmitted their applications in recent weeks, tailoring their products to the structure of approved Bitcoin funds based on CME Exchange futures. Insiders have confirmed to Bloomberg that the SEC is likely to approve one or even several of the Ether ETFs, potentially providing institutional investors with an additional investment opportunity for the second-largest cryptocurrency by market capitalization by mid-October.
In February of this year, the leading US crypto exchange Coinbase surprised the industry with the announcement of its own blockchain, “Base.” While competitors like Binance also operate their own networks, the Base platform is built as a Layer-2 solution on Ethereum. Comparable to prominent “Optimistic Rollups” like Arbitrum and Optimism, Base leverages the technology stack of the latter. By bundling transactions, the network enables faster and more cost-effective interactions with the blockchain. Base is supposed to allow the exchange to lead new crypto users through the industry by integrating it into its existing service offering.
Just a few days after Base, another Layer 2 network appeared that users had been waiting for for a long time. Shibarium is a blockchain for the ecosystem around the memecoin Shiba Inu (SHIB). The Dogecoin successor has remained in a steady rebranding from a meme currency to a comprehensive DeFi ecosystem since its resounding success in the spring of 2021. The Shibarium blockchain is meant to accelerate this transformation into a serious crypto project. But is copying existing projects and adding a cute dog logo enough?
In November last year, the insolvency of the fraudulent FTX/Alameda construct shocked the crypto markets. On one hand, the space lost one of the highest-volume trading platforms. On the other hand, the largest market maker on decentralized platforms – Alameda Research – also became insolvent. The repercussions of this collapse are still evident today. Liquidity on DeFi exchanges like Curve diminishes steadily, especially during times of high volatility, and even the order books of centralized marketplaces are less populated that before.
A summarizing review of what has been happening at the crypto markets of the past week. A look at trending sectors, liquidity, volatility, spreads and more. The weekly report in cooperation with market data provider Kaiko.
In addition: Market participants are anxiously awaiting a decision from the SEC regarding the first spot-based Bitcoin ETF in the US. What seemed highly unlikely a few months ago has come within reach due to the application by the world’s largest asset manager, BlackRock. However, other issuers must remain patient. This week, the regulatory authority postponed its decision on the spot ETFs proposed by fund companies ARK Invest and 21Shares. The agency aims to gather public comments on one of the proposed changes in the application beforehand. The initial deadline for BlackRock’s iShares Bitcoin Trust is set for the first week of September. The SEC theoretically has the option to defer its decision three times before rendering a final judgment. An overview, including the relevant dates.