Hodler’s Digest, April 14-20 – Cointelegraph Magazine

Top Stories This Week

Grayscale spot Bitcoin ETF ‘halves’ before BTC halving

Major Bitcoin investor Grayscale Investments saw its spot BTC exchange-traded fund (ETF) holdings drop 50% ahead of the anticipated Bitcoin halving event.

On April 16, Bitcoin holdings in the Grayscale Bitcoin Trust ETF (GBTC) shrunk by one-half from 619,220 BTC on the first day of trading on Jan. 11.

The spot Bitcoin ETF held 309,871 BTC on its 66th day of trading, down 50% of the amount since the trading debut, according to GBTC data.

The GBTC “halving” came just two days before the much-anticipated Bitcoin halving, which will reduce the mining reward by 50% from 6.25 BTC to 3.125 BTC.

Occurring once every four years, or once in 210,000 blocks, the Bitcoin halving is a major event, often tied to subsequent rallies in the crypto market.

The two events do not correlate but make for another coincidence in the chronology of Bitcoin-related occurrences.

Worldcoin launches its own ‘human-centric’ blockchain network

Worldcoin, an identity coin startup founded by OpenAI CEO Sam Altman, has furthered its “human-centric” approach to the Web3 space with its new blockchain network, World Chain. 

On April 17, Worldcoin announced World Chain, which is a new blockchain initiative designed to prioritize human users, enhance efficiency and foster real-world utility in Web3 applications.

Worldcoin recently surpassed 10 million World IDs created and 75 million completed transactions, signaling the project’s rapid expansion. 

Its own dedicated network has been designed to scale alongside the broader Ethereum network as a layer 2 to meet the project’s needs.

Cointelegraph spoke with Tiago Sada, the head of operations at Worldcoin, to better understand the project’s intention with its network and how it plans to keep humans in the center.

Sada said that while, technically, World Chain will act similarly to Ethereum and any other L2, its nuance is that it prioritizes humans over bots, with blockchains often facing congestion due to bot activity.

“Usually, the way it works is that every account is fighting for block space. Usually, since bots can move faster and they can outbid humans,” he said, “the networks get saturated with all the transactions for bots, and humans have whatever is left — many times, they can’t even get in.”

Andreessen Horowitz raises $7.2B for new venture funds

Venture capital firm Andreessen Horowitz (a16z) said it raised $7.2 billion to invest across several tech sectors, including gaming and artificial intelligence — but isn’t putting any more toward crypto.

The firm’s “Growth” venture strategy — a bundle of funds backing a range of early-stage startups — will receive the largest chunk of the raise at $3.75 billion. 

Its “Infrastructure” and “Apps” strategies will, respectively, receive $1.25 billion and $1 billion, a16z said in an April 16 statement.

Its “Infrastructure” strategy mostly focuses on funding teams in the AI, computing and data industries, while the “Apps” funds focus on consumer, enterprise and fintech application builders.

The remaining $1.2 billion will be evenly split between “Games,” its gaming-focused fund, and its new “American Dynamism” fund, which invests in founders and companies supporting United States national interests in aerospace, defense, safety, education and manufacturing.

Its $4.5 billion crypto-focused fund didn’t receive any additional funding.

Cyprus keeps FTX Europe license suspended until September

The Cyprus Securities and Exchange Commission has extended the suspension of FTX Europe’s license, prohibiting the firm from offering services until September.

Cyprus’ securities regulator officially announced the news on April 16, declaring that FTX Europe must proceed with necessary actions to comply with the relevant provisions of the Investment Services and Activities and Regulated Markets Law.

As part of the regulatory decision, FTX Europe is banned from providing investment services as well as entering into any business transaction with any person or accepting any new clients. 

The firm is also prohibited from advertising investment services, as per the announcement.

Token holders approve $7.5 billion AI merger

Token holders of SingularityNET, Fetch.ai and Ocean protocols approved a $7.5 billion merger that would create a combined Artificial Superintelligence Alliance (ASI) project.

The Fetch.AI (FET) token will become the ASI token with a total supply of 2.6 billion. 

Meanwhile, SingularityNET (AGIX) and Ocean (OCEAN) tokens will be converted into ASI at approximate ratios of 0.43:1, with ASI tokens having a combined value of $7.5 billion post-merger, according to the April 16 announcement.

The ASI is scheduled for launch on May 24. 

“Our mission is to create a decentralized AI infrastructure at scale, ensuring ethical and trustworthy practices,” said Humayun Sheikh, chairman of the Artificial Superintelligence Alliance and CEO of Fetch.ai.

Winners and Losers

At the end of the week, Bitcoin (BTC) is at $63,444, Ether (ETH) at $3,072 and XRP (XRP) at $0.49. The total market cap is at $2.28 trillion, according to CoinMarketCap.

Among the biggest 100 cryptocurrencies, the three best-performing altcoins of the week were ONDO (ONDO) at 6.79%, UNUS SED LEO (LEO) at -0.33% and OKB (OKB) at -1.63%.The top three altcoin losers of the week were ORDI (ORDI) at -39.37%, Ethena (ENA) at -36.72% and Bittensor (TAO) at -33.85%.

For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“I always tell people that if you buy Bitcoin and you are trying to predict what the price is in an hour or a day, a week, or even a month, that’s probably a fool’s errand. Instead, what you should think about is, ‘This is a savings technology.’”

Anthony Pompliano, founder and partner at Pomp Investments

“With only 2 million Bitcoins left, if we assume a daily inflow of $500 million to Bitcoin Spot ETFs, the equivalent of around 7,142 Bitcoin will leave exchange reserves daily, suggesting that it will only take nine months to consume all of the remaining reserves.”

Bybit, cryptocurrency exchange

“Don’t expect a lot of flows — I saw one estimate of $25b that’s insane. We think they’ll be lucky to get $500m.”

Eric Balchunas, senior ETF analyst at Bloomberg

“Unfortunately, a small fee for new user write access is the only way to curb the relentless onslaught of bots.”

Elon Musk, owner of X and CEO of Tesla

“AI and Gaming have garnered the most resounding revival of venture capital enthusiasm among the categories.”

QuickNode, blockchain development platform, and Artemis, an on-chain analytics provider

“With the bond market now projecting less than three cuts and 10-year Treasury yields surpassing 4.50%, we may have arrived at a crucial tipping point for risk assets.”

Markus Thielen, founder of blockchain analytics firm 10x Research

Prediction of the Week

Bitcoin miners could dump $5B in BTC after halving

Bitcoin miners could potentially liquidate $5 billion worth of BTC after the halving, the head of research at 10x Research, Markus Thielen, calculated in an April 13 analyst note.

“The overhang from this selling could last four to six months, explaining why Bitcoin might go sideways for the next few months — as it has done following past halvings,” he added.

Thielen said that the same could happen again, with crypto markets potentially facing “a significant challenge in a six-month ‘summer’ lull.”

Bitcoin prices remained range-bound between $9,000 and $11,500 in the five months that followed the 2020 halving.

FUD of the Week

Bitcoin price falls under $62K amid wavering spot BTC ETF demand

Bitcoin’s price fell 3% on April 16 as crypto investors entered a risk-off mode amid stagnating ETF demand.

Data from Cointelegraph Markets Pro and TradingView showed local BTC price lows of $61,709 on Binance shortly after the Wall Street open on April 16.

Bitcoin joined U.S. stock indexes in heading lower on the day, as the U.S. Dollar Index reached a six-month high of 106.17.

On April 15, capital flows into the spot Bitcoin exchange-traded funds recorded $36.7 million in net outflows, according to data from Farside Investors.

Mango Markets exploiter found guilty after jury deliberations

A jury has found Avraham “Avi” Eisenberg, the crypto user responsible for a $110 million exploit of the Mango Markets decentralized exchange, guilty of fraud and market manipulation.

In an April 18 ruling in the United States District Court for the Southern District of New York, a group of jurors announced that Eisenberg had been found guilty of wire fraud, commodities fraud and commodities manipulation. 

The decision followed hours of deliberations after closing arguments on April 17. 

During a two-week trial, Eisenberg’s legal team claimed that he did not commit any crimes but orchestrated a “successful and legal trading strategy,” which resulted in roughly $110 million from Mango Markets.

He returned roughly $67 million of the funds after the exploit but retained more than $40 million following a governance vote by the community. 

Prosecutors argued that Eisenberg’s actions constituted fraud.

IRS investigation chief expects uptick in crypto tax evasion this year

The United States Internal Revenue Service says it’s gearing up for a significant rise in crypto tax crime cases going forward, as the deadline for U.S. citizens to file their taxes was on April 15. 

Speaking to CNBC at the Chainalysis Links event in New York, IRS criminal investigation chief Guy Ficco said his agency was getting ready to deal with an uptick in cases of tax fraud and evasion that have come along with it.

“There’s going to be a lot more charged Title 26 crypto cases this year and moving forward,” he said.

A Title 26 tax code refers to citizens who willfully evade paying taxes by lying or obfuscating their reporting documents.

Ficco said that crypto had previously been used mostly as a tool in financial crimes such as fraud, scams, and money laundering — however, he said his agency had recently observed a drastic uptick in “pure crypto tax crimes” and expected even more in the near future.

Top Magazine Pieces of the Week

6 Questions for Kieren James-Lubin, who wants us to ‘get on the same page’ about grandma

You may have heard of Joseph Lubin, the Ethereum co-founder presently serving as the CEO of Consensys. But don’t confuse him for Kieren James-Lubin, the entrepreneur’s highly successful son, who co-founded BlockApps in 2015.

Get Bitcoin or die tryin’: Why hip hop stars love crypto

From Snoop Dogg to Ghostface Killah, hip hop and Web3 make a perfect pair. So, why do rappers love crypto?

The real risks to Ethena’s stablecoin model (are not the ones you think)

Ethena can only secure industry trust by demonstrating resilience under adverse market conditions. Like now.