Author and Bitcoin expert Jimmy Song recently took the stage at the 2024 Bitcoin event in Nashville to denounce the topics presented on the first day of the event, including the encroaching banking sector, institutional investment, and the advent of exchange-traded funds in the United States as efforts by multinational corporations and the administrative state to co-opt the Bitcoin movement.

During the panel, Song appealed to the rugged individualism and pioneering spirit inherent in traditional American values and Bitcoin (BTC), sharply rebuking previous panels from deviating from those values to entertain speakers from financial institutions like BlackRock, the largest asset manager in the world.

"What makes Bitcoin great is liberty, freedom, self-sovereignty. Those are the things that this country was founded on. And unfortunately because of the money, because of the power of the money printing press, what we've gotten is an administrative state that rules over us that thinks that they're better than us."

Fellow panelist and independent media personality Luke Rudkowski echoed Song's comments, explaining that Bitcoin "Really does provide an amazing opportunity for a lot of people to really see the problems that government created," before explaining that the scarce decentralized asset empowers people to help themselves and each other independent of state structures.

Related: How DePin Networks can decentralize law enforcement.

Centralized government is becoming a multi-headed hydra 

The warnings from Song's panel come at a time when state surveillance and attacks on free speech are on the rise, particularly in the United States, which hosts the largest government bureaucracy of any modern country.

In April of 2024, whistleblower Edward Snowden sounded the alarm that the National Security Agency (NSA) was days away from taking over the internet due to the imminent reapproval of warrantless spying under FISA Section 702, which was signed into law by Joe Biden roughly one week after Snowden warned the American people.

Crypto fixes this 

While completely decentralized technologies like Bitcoin have revolutionized money by removing the state's monopoly on the mint, other crypto technologies and digital assets further the cause of freedom by neutralziing the state's surveillance apparatus.

During an interview with Tucker Carlson in April 2024, Telegram founder Pavel Durov explained that the tendency for governments to build a panopticon of surveillance will drive developers to create novel communication devices inspired by crypto wallets to sidestep state surveillance architecture.

Magazine: Exclusive: 2 years after John McAfee’s death, widow Janice is broke and needs answers.

Client demand was the driving force behind Bitcoin exchange-traded fund (ETF) creation, and the funds are just beginning to pick up momentum, BlackRock head of digital assets Robert Mitchnick said at the Bitcoin2024 event. He was interviewed on stage by Bloomberg journalist James Seyffart.

BlackRock CEO Larry Fink was a vocal skeptic of cryptocurrency when Mitchnick was hired in 2018. Fink was subsequently “orange-pilled,” pivoting to call Bitcoin “digital gold” in a recent interview.

Digital assets require study

Mitchnick credited Fink himself for the change of heart. “Larry deserves a lot of credit for the time that he spent studying the space,” Mitchnick said. He added:

“If you are a student of financial history and geopolitics or you are a technologist, Bitcoin tends to come more easily, and Larry is very much both those things.”

Larger forces came into play as well. Mitchnick noted that, with or without regulatory clarity, crypto as an asset class and technology were clearly “here to stay.” They had institutional-grade infrastructure and “the final piece that helped push us over the top” was client demand.

Related: BlackRock begins asset tokenization with launch of digital liquidity fund

Source: James Seyffart

Crypto ETFs are just beginning to find their client base

Bitcoin ETFs were the biggest and most successful ETF launches in history, Seyffart said. He estimated that 20-25% of BlackRock revenue flow this year has come from the iShares Bitcoin Trust (IBIT), placing it as the asset manager’s second most successful offering after the S&P500 ETF.

Mitchnick said direct investors led the demand when the ETF was introduced. BlackRock wealth advisory and institutional investors are still gathering momentum. “Those are much longer journeys and we're still only part way down that track,” he observed.

None of the large wealth advisory platforms, like Morgan Stanley, UBS and Merrill Lynch, have begun offering Bitcoin ETFs on a solicited basis yet, meaning that they will only offer the ETFs at the request of the client.

“Typically, that takes multiple years for a new ETF to get to that solicited status,” although “many of the largest platforms are accelerating their efforts to do so,” Mitchnick said. He thought the situation may begin to change this year. He estimated that the BlackRock Registered Independent Advisers who have adopted the ETFs are allocating 2-3% of funds to them.

Institutions move similarly slowly as they to research and due diligence on new assets, Mitchnick said.

Magazine: BlackRock meets with SEC over ETF, Binance’s new era begins and SBF loses release bid: Hodler’s Digest, Nov. 19-25

Asset manager Blackrock sees “very little interest” among clients in crypto beyond Bitcoin (BTC) and Ethereum (ETH) and doesn’t foresee many crypto exchange-traded funds (ETFs) outside of those two core digital assets, according to Robert Mitchnick, BlackRock’s head of digital assets, speaking at the Bitcoin2024 conference on July 25 in Nashville, Tennessee. 

“I would say that our client base today, their interest overwhelmingly is in Bitcoin first, and then somewhat in ETH… and there’s very little interest today beyond those two,” Mitchnick said at a panel entitled From Strategy to Innovation: BlackRock's Bitcoin Journey.

“I don't think we're gonna see a long list of crypto ETFs,” Mitchnick said. Blackrock launched its first crypto exchange-traded funds — iShares Bitcoin Trust (IBIT) and iShares Ethereum Trust ETF (ETHA) — in January and July, respectively.

At upwards of $22 billion in assets under management (AUM), Blackrock's IBIT Bitcoin ETF is among the most popular. Source: Blackrock

Not all asset managers agree. Franklin Templeton, which also issues BTC and ETH ETFs, is optimistic about more cryptocurrency ETFs, including a Solana product.

“Besides Bitcoin and Ethereum, there are other exciting and major developments that we believe will drive the crypto space forward,” Franklin Templeton wrote in an X post on July 23.

Most of Blackrock’s clients see BTC and ETH as complements, rather than competitors, Mitchnick said. When clients buy ETH ETFs, they usually add to an existing crypto portfolio allocation, rather than swap out of BTC, Mitchnick added. He cautioned that data on investor flows into ETH ETFs —- which only started trading on July 23 — is limited.

Related: Ethereum ETF sell-off signals more trouble — 10x Research

“The whole store of value use case within crypto is pretty definitively territory that Bitcoin owns,” Mitchnick said.

“ETH is trying to do a bunch of different applications that for the most part, Bitcoin is not trying to do,” he added. “So, really, they're more complements than they are competitors or substitutes.”

Mitchnick said he expects investors to allocate eventually around 20% of crypto holdings to ETH, with the remainder going to BTC.

Blackrock’s crypto ETFs are among the most popular in the industry, with IBIT commanding some $22 billion in assets under management (AUM) and ETHA approaching $270 million after only a few days of trading.

Magazine: Coinbase will not mention ‘crypto’ in five years: Avichal Garg, X Hall of Flame

Steven Fulop, the mayor of Jersey City since 2013, suggested he planned to allocate part of the city’s pension fund to crypto exchange-traded funds, or ETFs. 

In a July 25 X Post, Mayor Fulop said the Jersey City pension fund was updating its paperwork with the United States Securities and Exchange Commission (SEC) to reflect an investment in Bitcoin (BTC) ETFs. Though the mayor did not explicitly state what percentage of the fund would be in crypto, he said it would be similar to the 2% allocated by the Wisconsin Pension Fund.

“I’ve been a long time believer (through ups/downs) in crypto but Broadly [sic], beyond crypto I do believe blockchain is amongst the most important new technology innovations since the internet,” said Fulop.

Source: Steven Fulop

In May, the State of Wisconsin Investment Board reported exposure to spot Bitcoin ETFs issued by Grayscale and BlackRock. At the time, the two crypto investments totaled $164 million out of the board’s roughly $156 billion in assets. 

Related: Bitcoin returns “too significant to ignore” for world’s retirement plans

The SEC approved the listing and trading of spot Bitcoin ETFs on US exchanges in January, but of publicly-run pension funds, only those from the states of Wisconsin and Jersey City seem to be considering crypto ETFs. Mayor Fulop did not explicitly mention potentially investing in spot Ether (ETH) ETFs, which started trading in the US on July 23.

Major financial institutions Wells Fargo and JPMorgan Chase reported less than $1 million combined in spot Bitcoin ETF investments — a tiny fraction of the firms’ trillions of dollars in assets. Cointelegraph reached out to Mayor Fulop for comment but did not receive a response at the time of publication.

Magazine: Trauma bonding through crypto rubble puts the Lads on top: Tristan Yver, NFT Creator

Christian Catalini, co-founder and chief strategy of Lightspark, shared his thoughts about the future of money and the role of digital assets in democratizing investment banking features at the Bitcoin 2024 Nashville conference.

In a lively conversation with Joey Garcia of Xapo Bank and moderator Nolan Bauerle, Catalini touted the power of the Bitcoin Lightening Network to deliver nearly instant cross-border payments, an option that was not available to the general public until the advent of cryptocurrencies.

"If you're trying to move out between two countries, and as it turns out, people love Bitcoin on both sides, you can quickly go in and out of the lightning network, you converted the edges."

The discussion revolved around challenging the current banking hegemony layer-by-layer, starting with payment networks and yield-bearing money and eventually introducing more high-end features to the public like securitized lending, a privilege traditionally only open to high net-worth individuals and institutions.

Even inside a heavily developed country like the United States, many are apprehensive about traditional banking. Source: Self Inc.

Related: European Investment Bank calls for more ‘innovation’ financing in EU.

Banking the unbanked and potentially soft-landing the imploding fiat system

Cryptocurrencies are already transforming the financial landscape and banking the unbanked across the developing world. In June of 2024, the head of Nigeria's Securities and Exchange Commission highlighted the benefit of cryptocurrencies to the country's population for things like cross-border remittances, noting that 34% of the country's residents are already using digital assets.

The decentralized nature and fast finality time of digital assets make the asset class perfect for remittances, vastly reducing the costs and wait times associated with traditional remittance services such as Western Union or MoneyGram. Venezuela exemplifies the growing trend toward digital assets for this very reason. According to Chainalysis, digital assets accounted for 9% of the total cross-border remittances sent to the country in 2023, a figure that has grown every single year since 2018, except 2020.

Stablecoins have also been presented as a way for residents of high-inflation countries to preserve their purchasing power and own dollar-denominated liquidity in jurisdictions with strict currency controls.

Oddly enough, stablecoins have been pitched as a way to extend the lifespan of the overprinted US dollar, with stablecoin issuers quickly becoming some of the largest buyers of United States Treasury bills and other debt instruments, driving up demand for the fiat assets at a time when international blocs like the BRICS countries are seeking to decouple from the dollar.

Magazine: Beyond crypto: Zero-knowledge proofs show potential from voting to finance.

The Cardano network is ready for the Chang hard fork with the latest release of node validator software. The hard fork is part of the transition to the Voltaire era of decentralized network governance.

The latest version of the validator node, Node 9.1.0, is an upgrade of Node 9.0 released on July 8. Besides fixing some bugs, the new node requires the use of the Conway Genesis file on the mainnet, which will enable the crossover to the Chang hard fork. The hard fork can be implemented when 70% of validators have upgraded to the new node.

Cardano Node 9.1.0 documentation. Source: GitHub 

Chang hard fork promises big changes

Validators are upgrading fast, with 11% upgraded at the time of writing, but an observer noted that scripts and tooling remain to be upgraded. The Intersect Cardano user group commented that the upgrade will bring about a “significant transformation” of the Cardano ecosystem:

“This release signifies the completion of primary development work for the bootstrap phase of on-chain governance. […] This milestone marks the installation of the core elements of decentralized governance, rolled out across two distinct phases.”

The second phase of the Chang upgrade will be initiated later this year, Intersect added. The first phase will see “bootstrap governance” as the ecosystem becomes accustomed to the new features, as foreseen in Cardano Improvement Proposal 1694, published in November 2022.

Source: Intersect

Related: Cardano updates MiCA compliance indicators 6 months ahead of the curve

Cardano decentralization going as planned

According to Cardano documentation, the Chang hard fork will create on-chain governance mechanisms for a constitutional committee and delegate representatives that will vote on behalf of individual Cardano’s Ada coin (ADA) holders and give a new governance role to stake pool operators. Proposals and votes will take place on-chain.

The last upgrade to Cardano was the Vasil hard fork in September 2022, which allowed for faster block creation and improved smart contract performance. The Alonzo hard fork in September 2021 brought smart contracts to the ecosystem.

The launch of the Chang software was delayed by a month, possibly because of upgrades to the Node 8 series necessitated by a distributed denial-of-service (DDoS) attack on June 25.

The five eras of Cardano. Source: Cardano

Voltaire is the final era planned for the network and is marked by the transition of governance from the Input-Output Hong Kong company to the community. Cardano has a market cap of about $14 billion.

Magazine: ‘Account abstraction’ supercharges Ethereum wallets: Dummies guide

After flirting with the $68,000 level on July 22, Bitcoin (BTC) faced a 6% correction in three days, erasing the gains from the prior week. From a bullish perspective, there is a positive indication as the $64,000 support held firmly. 

Buyers stepped in to defend Bitcoin’s market capitalization at $1.25 trillion, slightly above the United Kingdom's British pound, valued at $1.15 trillion. Still, Bitcoin bears have macroeconomic data on their side, at least in the short term.

Bitcoin price drop coincides with the US stock market decline

Bitcoin’s price decline coincides with the Nasdaq index futures movement, which experienced a 4.9% correction between July 23 and July 24. Traders now question if the drivers behind the stock market decline, especially the tech names, justify the correlation with the cryptocurrency market. If investors’ concerns are mostly derived from economic recession fears, Bitcoin’s long-term appeal could present a buying opportunity.

Bitcoin/USD (left) vs. Nasdaq futures (right). Source: TradingView

Semiconductor stocks and those related to artificial intelligence infrastructure (AI) led the move, with Crowdstrike (CRWD) down 25.5% in a week, followed by Super Micro Computer (SMCI) down 12.6%, GlobalFoundries (GFS) down 12.2%, NXP Semiconductors (NXPI) down 10.8%, and Intel Corp (INTC) down 10.5%. The market seems especially concerned with the perspective of AI demand, given how the investment in the sector has yet to result in profitability.

UBS Global Research’s Stephen Ju warned investors that the AI investment benefits in Google’s cloud platform are “difficult to discern” and should not be visible on the revenue line before mid-2025. In the second quarter, Google's parent company reported spending $2.2 billion building AI models. Consequently, Ju questions if the investment returns will be compromised, as the company will require higher capital expenditure for another two years, as reported by Yahoo Finance.

Strong macroeconomic data and a court case against Bitfinex

Recent macroeconomic data has also contributed to investors’ worsening sentiment. The United States economy grew at a 2.8% annualized rate in the second quarter, above the market consensus of 1.9%. Additionally, continuing jobless claims, which measure the number of people in the US receiving benefits after an initial week of aid, declined on a seasonally adjusted basis. This indicator typically serves as a proxy for hiring, a more forward-looking metric.

Recent economic indicators signal the success of the US Federal Reserve's (Fed) strategy to curb inflation without causing a recession. The US central bank has kept its benchmark overnight interest rate in the current 5.25%-5.50% range since 2023, but analysts expect two to three cuts by the end of 2024.

This data is somewhat negative for Bitcoin, as part of its appeal is as a hedge against inflation, a lower value of the US dollar, and decreased investor confidence in US Treasury securities. In other words, a strong economy makes alternative assets less appealing, regardless of the stock market's expectations for corporate earnings.

Related: Crypto has more potential than stocks, real estate — Kraken survey

Bitcoin investors are also concerned about the civil litigation case against the Bitfinex exchange and Tether company. The US District Court for the Southern District of New York allowed the class-action complaint to proceed to discovery on claims of a scheme to manipulate the market price for certain cryptocurrencies through the fraudulent issuance of unbacked Tether (USDT). The court released the redacted document with the latest updates on July 24.

It is worth noting that this is a civil case, and the claims presented have not yet been proven in court. Essentially, Bitfinex and Tether may ultimately have to pay a fine and adjust some of their procedures, but this process will likely take years to resolve fully. Therefore, even if the outcome is negative, there is nothing about this case that should cause imminent price pressure on Bitcoin.

Bitcoin’s recent underperformance can most likely be attributed to strong macroeconomic data and investors’ fears of a bubble caused by the artificial intelligence hype.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

The Bitcoin 2024 conference kicked off on July 25 in Nashville, Tennessee with high profile speakers like Donald Trump, Michael Saylor, Cathie Wood, Robert F. Kennedy Jr, Russell Brand and Edward Snowden set to draw record crowds.

The Trump factor

11:26 UTC: Cointelegraph's US news editor Sam Bourgi and journalist Ana-Paula Pereira are on the ground covering the event with the latest insights, pictures and video from panels and interviews.

Cointelegraph US news editor Sam Bourgi, journalist Ana-Paula Pereira and Cointelegraph Accelerator's Kyle White at Bitcoin 2024 in Nashville.

The conference has garnered significant attention in the preceding weeks as prominent politicians joined the lineup of speakers set to feature at the event in Nashville. 

Donald Trump is the headline speaker brandishing adverts around Nashville. 

Presidential candidates Donald Trump and Robert Kennedy Jr are two major drawcards along other notable speakers like Michael Saylor, Cathie Wood, senators Marsha Blackburn, Cynthia Lummis 

Related: Trump reelection campaign raised $3M in crypto for Q2 2024

Bitcoin and Lightning still hold promise for retail banking

15:26 UTC: Lightspark chief strategy officer Christian Catalini and Xapo Bank director of public affairs, policy and regulation Joey Garcia unpack the promise that Bitcoin and the Lightning Network will still significantly impact retail banking.

Lightspark's Chris Catalini, Xapo Bank's Joey Garcia and Nolan Bauerle discuss Bitcoin's potential in the retail banking sector.

Catalini emphasized the ability of Bitcoin from its inception to seamlessly allow its users to transfer value globally across "more than 200 countries, every day, 24/7 with deep liquidity':

"There's only one asset and that asset is Bitcoin. It has regulatory clarity. It has on and off ramps in pretty much every country around the globe."

Related: VanEck says Bitcoin could hit $2.9 million per coin by 2050

BlackRock' clients are mainly interested in BTC, ETH

17:38 UTC: BlackRock head of digital assets Michael Mitchnick unpacked the global asset manager's move into cryptocurrencies through Bitcoin and Ethereum exchange traded-fund products in 2024 in conversation with Bloomberg's James Seyffart.

Bloomberg's James Seyffart alongside BlackRock's Michael Mitchnick on the Nakamoto main stage. 

"I would say that our client phase today, their interest overwhelmingly is in Bitcoin first. There's definitely interest in Ethereum too but there's very little interest today beyond those two."

Disclaimer: This article is being actively updated on 25 July. 

Magazine: Godzilla vs. Kong: SEC faces fierce battle against crypto’s legal firepower

OpenAI’s ChatGPT has announced the launch of a search engine, presumably as a potential rival to Google. 

In a July 25 notice, ChatGPT’s website included a page for ‘SearchGPT,’ a prototype “using the strength of our AI models to give you fast answers with clear and relevant sources.” SearchGPT was not available for all users at the time of publication, as the platform is awaiting feedback from a small group before a full release.

According to the platform, results will be more visual than Google’s and allow follow-up questions to refine a search. For example, SearchGPT has partnered with publishers and creators, citing sources in relevant search results.

“While this prototype is temporary, we plan to integrate the best of these features directly into ChatGPT in the future,” said OpenAI.

This is a developing story, and further information will be added as it becomes available.

Venture funding for Web3 startups is stabilizing after a year-long decline that started in 2023, with crypto ventures locking up some $2 billion in financing in the second quarter of 2024, according to Crunchbase. 

The Q2 numbers are only modestly higher than the $1.8 billion raised in the prior quarter but reverse a downtrend that saw Web3’s quarterly venture funding totals drop by roughly half last year, from $2.3 billion in Q1 of 2023 to $1.4 billion in Q4, according to Crunchbase.

A drop in the total volume of deals mirrored the decline in funding. Total deal volume fell from a peak of 681 in Q1 of 2023 to some 284 in Q4. Despite the most recent quarter’s rebound in funding amounts, deal volume continues to languish, with only 291 financing rounds closing in Q2 of 2024, according to the data.

Q2, 2024 saw a modest recovery in total deal value but number of deals still lags past quarters. Source: Crunchbase

Not only are Web3 venture deals still scarce, but they are also more cautiously-sized. In Q2 of 2024, only seven rounds exceeded $50 million, Crunchbase said.

In fact, much of this past quarter’s apparent recovery is attributable to one deal: New York-based Monad Labs’ $225 million funding round led by Paradigm. Monad is a new Layer-1 blockchain network set to compete with Solana, among others.

Other notable Q2 deals include Farcaster's $150 million Series A led by Paradigm, valuing the company at $1 billion; Berachain's $100 million round led by BH Digital and Framework Ventures, valuing it at $1.5 billion; and Auradine's $80 million round from investors including Mayfield Fund and Celesta Capital, Crunchbase said.

The sluggish deal flow is partly because venture fund investors — known as Limited Partners (LPs) — are waiting on payouts from past deals before financing new ones, and venture capital firms (VCs) are beginning to run low on dry powder, according to Regan Bozman, co-founder of venture firm Lattice Capital.

“There is a market dislocation starting to happen where many crypto VC funds are on the final 25% of deployment and so will need more money in next six months, but LP's want distributions first,” Bozman said in a post on the X platform. “But VCs need the market to come back before they can make distributions.”

Magazine: Trauma bonding through crypto rubble puts the Lads on top: Tristan Yver, NFT Creator

A preliminary investigation of the July 18 WazirX cryptocurrency exchange hack did not find “any evidence that WazirX signers’ machines were compromised,” according to a July 25 report from the exchange’s team. The post suggested that a breach in the system of multi-party computation (MPC) wallet provider Liminal may have been the cause of the $235 million exploit.

Liminal previously released a report suggesting that compromised WazirX machines were the cause of the exploit.

“Our preliminary findings have not found any evidence that WazirX signers’ machines were compromised,” the July 25 WazirX report states. The team is conducting a “thorough forensic analysis to uncover the full details of the cyber attack” and will share “conclusive evidence” of what happened once this analysis is complete.

WazirX hack analysis. Source: WazirX.

According to WazirX, despite searching for evidence that their own devices were compromised, the team’s investigators “have been unable to find any evidence that WazirX signers’ machines were compromised.” Instead, they found that the attack “involved the flow of transactions through Liminal infrastructure, as evidenced by the use of 3 WazirX signatures and 1 Liminal signature.”

The Liminal MPC wallet was supposed to prevent any withdrawals from being sent to non-whitelisted addresses. But it failed to do so, WazirX claimed.

In addition, the malicious transaction “upgraded the [multisig wallet] contract to transfer the control to the attacker,” which Liminal’s interface is not supposed to allow.

The report claims that India’s Central Bureau of Investigation (CBI) is a client of Liminal, as it uses the service to store assets seized during investigations. It suggests that the agency may not have used Liminal as a trusted custodian if it had known the wallet contract could be upgraded through Liminal’s interface.

“We have representations from Liminal that their interface does not allow initiating contract upgrade from its interface. It is pertinent to state here that the Central Bureau of Investigation (CBI), India’s premier investigative agency, has entrusted Liminal Custody Solutions with the secured non-custodial storage of digital assets seized during investigations which may also be based upon such representations by Liminal.”

The report hypothesizes that there are only two different ways the hack could have occurred. First, Liminal’s infrastructure could have been breached, causing its user interface (UX) to display false information when viewed by WazirX employees. Second, three separate WazirX devices could have been compromised, causing local copies of the UI to display false information.

However, multiple pieces of evidence suggest that Liminal’s infrastructure was breached, not WazirX’s, the report argues. First, there was no new connection request sent to Wazirx’s hardware wallets. Second, the request came from a whitelisted address, and third, all of the signers “saw the expected token name (USDT and GALA) and destination address on the Liminal interface as well as received email notifications.”

WazirX claims that these pieces of evidence provide strong evidence that a Liminal breach was the cause of the attack. Even so, they “await conclusive forensic results before making a final determination.”

The report also seeks to draw attention to the hack’s wider implications for the crypto community. One major cause of the hack was the necessary practice of “blind signing” token transactions from hardware wallets. Because token transactions do not show a destination address on the wallet’s LED screen, the user cannot definitively know where they are sending their tokens. Instead, they must rely on a separate device or custody provider’s interface to give them this information.

“If a custody provider’s infrastructure is compromised, there’s a theoretical risk that displayed transaction information could be manipulated, even with robust security measures in place,” the report stated.

In Liminal’s July 19 report on the attack, it claimed that its server infrastructure “is not breached and all wallets on Liminal’s infrastructure, including WazirX’s other Gnosis SAFE wallets deployed entirely from within Liminal’s platform continue to remain safe & secure.” It suggested that the attack may have been caused by an attacker gaining control of all three of the WazirX devices.

Related: Liminal blames compromised WazirX devices for hack

The practice of “blind signing” is widely regarded as a security problem within the hardware wallet community. In December, hardware wallet manufacturer Ledger promised to reimburse users after more than $600,000 of assets were stolen from them through blind signing exploits. Ledger promised to disable the ability to blind sign after June, 2024. In its report, WazirX did not state what brand of hardware wallets were used by their employees.

Magazine: Crypto-Sec: Evolve Bank suffers data breach, Turbo Toad enthusiast loses $3.6K

The cryptocurrency market took another hit on July 25, with the total market capitalization dropping by over 3.5% to about $2.31 trillion. This plunge has left many market participants questioning the core catalysts behind this downturn, and how much longer it may continue. 

24-hour performance of large-cap cryptocurrencies. Source: Coin360

Let’s look at the factors driving the crypto market down today.

Risk-off sentiment pulls the crypto market down

The crypto market is selling off, mirroring the weakness witnessed in US equities. The US stock market has lost a staggering $1.1 trillion in valuation over the last 24 hours.

Source: The Kobeissi Letter

The S&P 500 and Nasdaq hit multi-week lows on July 25, with the S&P 500 breaking one of its longest growth streaks with a daily decline of 2%. This highlights the impact of the surge in tech valuations which has left the index exposed to huge volatility in the event of a tech-led sell-off.

The risk-off sentiment being felt has triggered a sharp decline in the US Dollar Index, which fell another 0.3% to on July 25.

US Dollar Index daily chart. Source: TradingView

Meanwhile, US Initial Jobless Claims increased by 235,000 during the week ending July 20, according to the US Department of Labor (DoL) released on July 25. The numbers came in below initial estimates of 238,000 and were lower than the previous weekly gains of 245,000. Additionally, continuing claims decreased by 9,000 to 1.851 million during the week that ended July 13.

The market remains wary of the implications the current could have on the Federal Reserve’s monetary policy. While the Federal Open Market Committee (FOMC) is expected to meet on July 31, there are still low expectations of possible rate cuts in July.

Instead, investors have shifted their expectations of two or more interest rate cuts toward the end of the year. According to data from CME Group's FedWatch Tool, the odds of a rate cut coming at the September FOMC meeting are around 86% at the time of writing.

Fed target rate probabilities for Sept. 18 FOMC meeting. Source: CME Group

Spot Ethereum outflows weigh down crypto prices

The newly launched US-based spot Ether exchange-traded funds (ETFs) posted outflows on the second day of trading, logging a net outflow of $133.3 million, according to data from Farside Investors.

The new Ethereum investment products were weighed down by another heavy day of selling from the recently converted Grayscale Ethereum Trust (ETHE), which haemorrhaged $326.9 million in outflows.

Seven of the eight spot ETH ETFs posted net inflows on July 24 with, Fidelity’s Ethereum Fund (FETH) and the Bitwise Ethereum ETF (BITW) leading the pack with the largest net inflows, posting $74.5 million and $29.6 million in new flows, respectively.

Spot Ethereum flows table. Source: Farside Investors

BlackRock’s iShares Ethereum Trust (ETHA), which posted the most robust inflows out of the group on July 23, only gathered $17.4 million from investors on July 24.

These outflows have triggered a sell-off trend that closely follows a familiar pattern seen by previous crypto ETF launches, including spot Bitcoin (BTC), as reported by 10x Research.

Markus Thielen, the founder of 10x Research, explained that many traders expected Ether ETFs to lock in 20% of spot Bitcoin ETF inflows.

“However, they overlooked potential billion-dollar outflows from Grayscale and the tendency for exchange listings to trigger ‘sell the news' reactions. Additionally, the crypto market is entering a seasonally weak period.”

Meanwhile, spot Bitcoin ETFs saw minor net inflows of $44.5 million on July 24, after logging net outflows of $78 million on July 23.

This suggests a mixed sentiment in the market and indicates a lack of confidence in sustained growth in the short to medium term.

$330 million in liquidations rock the crypto market

The outflows coincide with accelerated long liquidations across derivatives markets, overpowering the short ones in the last 24 hours.

Data from Coinglass reveals that long traders—those betting on the crypto market's upside—have witnessed a total of $301.17 million worth of liquidations in the last 24 hours. In comparison, short traders suffered over $35.10 million in liquidations in the same period.

Ether liquidations reached $125.36 million, with over $117.60 million worth of cumulative leveraged long positions liquidated, according to Coinglass data. Long Bitcoin liquidations stand at $86.51 million, with the tally increasing at the time of publication.

Total crypto liquidations. Source: Coinglass

When long positions are liquidated, traders who are betting on prices going up are forced to sell their positions, often at a loss. This increased selling pressure has driven the crypto market valuation lower today.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Investment manager VanEck foresees Bitcoin (BTC) potentially hitting $61 trillion in total market capitalization — or some $2.9 million per coin — in 2050 as a result of massive demand for the decentralized currency as collateral for trade settlement and a reserve for central banks, according to a July 24 report. 

“It is conceivable that by 2050 Bitcoin could be used to settle 10% of the globe’s international trade and 5% of the world’s domestic trade,” VanEck said in the report. “This scenario would result in central banks holding 2.5% of their assets in BTC.”

VanEck adds that scaling solutions for Bitcoin’s blockchain network — Bitcoin Layer-2s — could collectively be worth approximately $7.6 trillion, or around 12% of BTC’s total value.

“Crucially, we believe that Bitcoin’s scalability issues which have been the primary barrier to its widespread adoption, will be resolved by emerging Bitcoin Layer-2 (L2) solutions,” according to the report.

VanEck says it is too early to declare winners, but identifies 16 “high potential” Bitcoin Layer-2s. Source: VanEck

According to the report, the ascent of BTC will be partly driven by a decline in the world’s leading economies — such as the United States, the European Union, and Japan — relative to global economic activity. VanEck also anticipates a loss of confidence in those economies’ currencies resulting from unconstrained deficit spending.

Related: Don’t miss the bull run that could make Bitcoin great again

“In this environment of uncertainty, businesses and consumers worldwide are likely to recognize the endemic flaws of alternative fiat currencies, thereby generating demand for a neutral medium of exchange with immutable property rights and predictable monetary policy,” the report said. “This is where Bitcoin comes in.”

VanEck specifically cites the diminishing usage of the Euro and Yen in international settlements as an opportunity for expanded use of BTC. The Euro’s share of cross-border payments has declined from around 22% in the mid-2000s to only 14.5% today, the report said, adding that the Yen declined from around 6.2% to 5.4% in the same period.

The report assumes continued fiscal mismanagement by the world’s leading economies and a simultaneous deterioration of property rights, which may contribute to a rotation out of fiat currencies. VanEck flags problems with mining, scalability, and regulation as potential risks to continued BTC adoption.

Although gold has a well-established track record as a global reserve asset, VanEck said limitations related to logistics, security, and financial integration are hurdles to returning to the gold standard.

VanEck says it is too early to declare winners among Bitcoin Layer-2s, but identifies 16 “high potential” projects, including Lightning Network and Stacks.

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Real-world asset tokenization (RWA) is currently one of the best-performing sectors in the digital asset landscape, netting investors a 213% return in the first half of 2024, according to BitEye and Wu Blockchain, and fostering institutional interest in Web 3.

Despite the meteoric price performance of RWA, injections of fresh capital from Web 2 companies and institutional firms are needed to continue growing the Web 3 space, according to Jason Dehni, CEO of decentralized private credit platform Credbull.

The CEO explained that Web 3.0 firms typically focus on accessing liquidity from within the Web 3.0 sector rather than seeking capital from the outside world, "We [have] become very insular," Dehni said, noting that the announcement of new tokenized products from investment bank Goldman Sachs confirms there is a high degree of institutional interest for tokenized assets.

Related: Tokenized US Treasurys could reach $3B by end of year.

Dehni then explained that the true value proposition in real-world asset tokenization rests in providing operational efficiencies, enhanced liquidity, and accountability to the end user, thereby democratizing asset classes and investment processes that are traditionally opaque.

"The value of RWA, for me, is primarily to provide more compelling product terms to a broader set of audience and liquidity and transparency. This is the ethos that we live by in Web3."

Not all real-world assets should be tokenized, with some asset classes like private credit or equity being more of an instant fit for asset tokenization, according to Credbull's CEO.

Conversely, commercial real estate could benefit from tokenization. However, the hard asset still presents challenges regarding adequately tokenizing something as complex as a real estate portfolio or a multi-unit commercial real estate property with monthly cash flows, expenses, and taxes from multiple sources.

The user interface nightmare

Institutional capital flows aren't the only thing holding Web 3 back, shifting his focus to the broader investment public, Jason Dehni explained that complex user interfaces and a poor user experience in crypto are some of the biggest factors keeping many people away from crypto.

On a scale of 10, "We're probably still around a four," when it comes to creating seamless and intuitive user interfaces the CEO said.

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Donors to Donald Trump’s campaign to be reelected as US President have contributed roughly $3 million in cryptocurrency since the candidate announced he would accept digital assets.

According to a Federal Election Commission (FEC) filing for the second quarter of 2024, the Trump 47 Committee received millions in crypto donations from roughly 20 individuals starting in May. The Republican nominee has publicly shifted from calling Bitcoin (BTC) a “scam” in 2021 to having his campaign defend miners and accept crypto donations in 2024. The filing did not include contributions from July.

The most significant contributions to the Trump campaign in Q2 2024 came from Gemini co-founders Cameron and Tyler Winklevoss, who pledged a combined $2 million in Bitcoin (BTC) on June 20. Kraken co-founder Jesse Powell said he would donate $1 million in Ether (ETH) on June 28. FEC filings show Powell contributed more than $844,000 while the Trump campaign was obligated to partially refund the Winklevoss’ BTC donation — guidelines impose a maximum of $844,600 per individual.

Q2 2024 FEC filing from Trump 47 Committee showing partial refund to Winklevoss twins

Ryan Selkis, the former Messari CEO who stepped down on July 19 following a series of tweets calling for civil war and inflammatory statements on immigrants, donated $50,000 in USD Coin (USDC) to the Trump campaign. Ripple’s chief legal officer, Stuart Alderoy, contributed $300,000 in XRP.

Alderoy’s social media posts have not suggested support for Trump. However, he has been highly critical of the Securities and Exchange Commission and its chair, Gary Gensler, under US President Joe Biden.

Among the smaller contributions to the Trump 47 Committee included $500 in Bitcoin from a homemaker in Alabama and several donations under $1,000 from retirees and self-employed individuals. Michael Belshe, the CEO of the BitGo crypto exchange, also pledged $50,000 in BTC.

For the second quarter, the committee reported more than $118 million raised in crypto and fiat and more than $142 million total in 2024. There were reports Biden was considering accepting crypto donations for his reelection campaign, but the US President announced on July 21 that he would not be running and instead endorsed his Vice President, Kamala Harris. Reports suggest that Harris — now the presumptive Democratic nominee — raised more than $100 million for her campaign in the 24 hours following Biden’s announcement.

Related: Kamala Harris could be ‘far more open’ to crypto business, Mark Cuban says

Since Trump survived an apparent assassination attempt at a Pennsylvania rally on July 13, he has received his official nomination at the Republican National Convention. He also plans to speak at the Bitcoin Conference in Nashville on July 27.

Following Biden dropping out of the race and Harris stepping up to be the presumptive Democratic nominee, Trump’s social media posts have been more frequent, including one attacking reports that he intended to appoint JPMorgan CEO Jamie Dimon or BlackRock CEO Larry Fink as secretary of the Treasury if reelected.

In addition to donations to official campaigns, money from the crypto industry may be moving the needle on tight congressional races. Fairshake, a political action committee funded by donors including Coinbase and Ripple, has raised roughly $169 million since its launch. The Super PAC and its affiliates have supported candidates through media buys and launched attack ads targeting politicians with anti-crypto views.

Magazine: Crypto voters are already disrupting the 2024 election — and it’s set to continue

A wallet associated with the Ethereum Foundation has transferred roughly $290 million in Ether after seven years of no movement.

According to data from blockchain analytics platform Arkham Intelligence, an address potentially connected to the Ethereum Foundation moved roughly 92,500 Ether (ETH) on July 25. According to Etherscan, the funds had not moved from the recipient address at the time of publication.

It’s unclear whether the Ethereum Foundation was responsible for moving the funds. Cointelegraph reached out to a spokesperson for comment but did not receive a response at the time of publication.

This is a developing story, and further information will be added as it becomes available.

Look, I’m far from being political. I do not fully support former President Donald Trump’s policies or his entire vision for the United States. However, as a strong advocate for crypto, I must acknowledge the upside to Trump potentially winning the election in November. For now, there is a solid chance that will happen — which is hardly surprising, considering he almost became a martyr in Pennsylvania.

The end of the crusade

At the risk of belaboring this point, the Biden administration hasn’t exactly been crypto’s greatest ally. It’s quite rare to see a piece of tech demonized as much as it has been under the Democratic Party’s tenure. Banks are scared, regulators are on the warpath, and adoption has stalled. But here's the thing: Trump’s election could change all of that relatively quickly.

I’m not going to argue that Trump has always been pro-crypto. A quick Google search will display from January 2019 when, during his first term in the Oval Office, he was quite explicit in not being a “fan of bitcoin and other cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air.” Ouch.

Related: Trump's RNC speech gave tech enthusiasts hope for the future

Fast forward to July 2024, and he’s scheduled to speak at Bitcoin Nashville. In June, he had a meeting with Bitcoin (BTC) miners behind closed doors, with the intention of creating a US monopoly over the industry. The winds are shifting, and crypto needs to piggyback on the political clout that is now unexpectedly sitting at the table.

Donald Trump wrote in 2019 that he was "not a fan of Bitcoin and other cryptocurrencies." Source: X

Even if Trump doesn't change a single crypto policy, just putting the handbrake on the prosecution would be huge for our industry. It would end the crusade, give banks some slack in deciding who they want to work with, and open the floodgates for mainstream adoption. America has — in recent history — always been a bulwark against crypto. Now, however, the last point of (futile) resistance might fall. With this potential shift in the political landscape, crypto providers should be prepared.

Keep your sails up

So what does this mean for crypto businesses? Keep your sails up. I expect this change in sentiment not to happen in the November election, but now. Yes, we will have the election and the fabled “Santa Claus rally” happening within weeks of each other, but the old cliché of “buy the rumor and sell the news” has never been more on point. You need to be ready for a potential surge like you've never seen before. Here's what crypto companies should be doing.

Firstly, beef up your infrastructure. Be prepared for a flood of new users that might overload your servers.

Related: Donald Trump’s crypto platform is missing one thing

Secondly, get your compliance in order. Make sure you're rock solid on existing regulations and licensing so you're on the front foot when sentiment changes.

Finally, look to partner with highly compliant banking partners. You want to be ready to take advantage of the new tailwinds in the industry without unstable and unsure fiat suppliers slowing you down.

Remember, this isn't just about existing crypto enthusiasts. We could see a whole new wave of retail investors — consumers who think, "I voted for Trump, now I'm going to buy Bitcoin." We could very easily see another gold rush towards all-time highs.

The Bitcoin factor

While these broader market trends are important, let's not forget about the immediate catalyst on the horizon: Bitcoin Nashville. I’ll be there, and I’m fascinated to see how Trump can hold the famous Nakamoto Stage for 30 minutes.

Kamala Harris declined an invitation to speak at a Bitcoin conference in Nashville in July 2024. Source: X 

Sure, this is undoubtedly an integral part of his campaign to win over voters. But the timing could not be better. BlackRock — the world’s largest asset manager — is holding more than $20 billion of Bitcoin in assets under management thanks to the approval of Bitcoin ETFs in January BlackRock will also be participating in the Nashville conference. Momentum is on the up, and all of the big players — from corporations to politicians — are pushing in the right direction.

Trump being pro-crypto is good for crypto. We can hold his policies in contempt all we want, but everyone in this industry should pay attention. Crypto needs to be open to riding the political tides when onboarding the first billion users. Hopefully, we’ve also learned we do need TradFi for the foreseeable future, and we need more mainstream adopters. We can't afford to commit our resources to fight against an anti-crypto crusade anymore. We should focus those resources on growing the industry.

So get ready. Make sure your compliance is top-notch. Work with highly compliant banking partners. Be prepared for a potential bull run like you've never seen before. Politics and crypto sentiments are intertwining, whether we like it or not. This could be what unlocks the next level of crypto adoption and growth.

Adam Bialy is a founder and CEO of Fiat Republic, a regulated banking and payments platform. He previously held senior management positions at OpenPayd, Sainbury’s, Ukash (acquired by Paysafe), and Raiffeisen Bank, among others. An avid bitcoin investor, Bialy has also held several advisory roles in the space, most notably at Ramp Network.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Bitcoin (BTC) revisited $65,000 after the July 25 Wall Street open as United States equities recovered from their worst day since 2022.

BTC/USD 1-hour chart. Source: TradingView

Bitcoin ticks higher after algo-led sell-off

Data from Cointelegraph Markets Pro and TradingView showed a BTC price rebound following initial sell-side pressure.

This was in the form of trading algorithms, popular trader Skew said on the day, while highlighting one entity in particular whom he dubbed an “aggro seller.”

Source: Skew

“This morning is a great example of liquidity games,” he explained in his latest X update.

“Aggro sellers slammed prices lower before large passive buyers came in. Price momentum is basically just positions covering over and over till closed and then market is net long. So probably another reversion trade later on.”

Skew and others tracked a modest ongoing comeback for US stock markets which had previously seen major losses. The Nasdaq 100 fell 3.6% on July 24, marking its worst day since November 2022, while the S&P 500 slid 2%.

Bitcoin displayed similar behavior overall, hitting local lows of $63,424 on Bitstamp.

BTC/USD vs. Nasdaq 100 1-day chart. Source: TradingView

“Did the bubble just pop?” trading resource The Kobeissi Letter queried in part of the day’s X commentary.

US macroeconomic data releases added to the state of market flux.

The Personal Consumption Expenditures (PCE) Index came in lower than expected — a potential relief for risk assets with reduced spending bolstering the odds of interest rate cuts.

Both initial and ongoing jobless claims were also below expectations, however, pointing to a resilient labor market and reducing market observers’ bets on cuts at the Federal Reserve’s next meeting on July 31.

The latest data from CME Group’s FedWatch Tool confirmed already very low odds of a curveball move from the Fed.

Fed target rate probabilities. Source: CME Group

Trader sets key target for BTC price daily close

Meanwhile, popular trader and analyst Rekt Capital stressed the importance of the current battle to flip $65,000 to support.

Related: Bitcoin ‘massive rally’ due as buy signal hits for 1st time in a year

This level, as Cointelegraph reported, represented the Bitcoin short-term holder realized price.

“Bitcoin is now in the process of retesting the $65,000 level in a volatile manner,” he told X followers alongside an explanatory chart.

“Needs to now Daily Close above $65k (blue) to render the retest as successful and keep price in the $65k-$71.5k region (red).”

BTC/USD chart. Source: Rekt Capital/X

Previously, Rekt Capital estimated that BTC/USD could need only around two months to achieve a new all-time high.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Fireblocks, the Web3 infrastructure platform, launched a suite of tools specifically designed for startups amid a proliferation of early-stage blockchain ventures, according to a July 25 press release. 

The toolkit — Fireblocks for Startups — is designed to help startups quickly build and launch Web3 products and includes solutions for treasury management, self-custody, private key storage, and secure digital asset transfers, the company said.

“The short history of crypto shows that successful projects — whether crypto exchanges, DeFi bridges, or NFT platforms — go through periods of hypergrowth during market upswings, with development teams focused solely on maintaining front-end stability while neglecting security in the process,” Idan Ofrat, Co-founder & Chief Product Officer of Fireblocks, said in a statement.

Fireblocks' new product rollout follows a surge in early-stage venture investments in Web3 startups. Source: Fireblocks

“Fireblocks for Startups ensures innovation is always in lockstep with security, providing a robust and accessible infrastructure for blockchain builders to build on without the technical and operational complexity,” Ofrat said.

The rollout follows a surge in early-stage venture investments in Web3 startups, with total investment volume jumping some 55% in the first quarter of 2024, according to the statement.

Since launching a pilot version of its startup toolkit, Fireblocks has already seen a 50% uptick in the number of startups using its Web3 infrastructure platform, according to the statement. Approximately 25% of Fireblocks’ customers are now startups or small-to-medium enterprises (SMEs), including names such as TaxNodes, Dendra, and Kunga, it said.

Fireblocks has been aggressively expanding its operations in 2024. In June, Fireblocks partnered with Coinbase International to offer derivatives and trading products to retail and institutional investors. One month prior, Fireblocks announced the launch of an institutional crypto custody arm in the US.

 “It is increasingly clear that there is a lack of qualified custodians in the United States covering digital assets,” Adam Levine, senior vice president of corporate development at Fireblocks, said in May.

Related: Fireblocks adds Coinbase International for perpetual futures, spot trading

Founded in 2018, Fireblocks is an enterprise Web3 platform best known for its digital asset custody and treasury management solutions. According to the company, it has facilitated the transfer of $6 trillion in digital assets since inception and serves over 30 exchanges and 55 banks in the digital asset space.

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Mt. Gox still has a whopping 90,000 Bitcoin, valued at roughly $6 billion, as investors and speculators weigh the effects the sell-off will have on the Bitcoin market.

Data from Arkham Intelligence indicates the last transaction made from Mt. Gox occurred on July 24, 2024, at 06:50:05 UTC and contained roughly 382 Bitcoin (BTC), valued at approximately $25 million, sent to Bitstamp.

Mt. Gox Bitcoin holdings. Source: Arkham Intelligence.

Mt. Gox sell-off triggers fear, uncertainty, and doubt 

News of the Mt. Gox sell-off has created fear, uncertainty, and doubt among market participants during the last several weeks, with the $8.2 billion question coming down to whether or not the Mt. Gox creditors, who have been waiting over 10 years for reimbursement, will sell their holdings.

According to a recent Reddit poll conducted in the Mt. Gox insolvency subreddit, 56% of the 467 creditors polled do not plan on selling their Bitcoin holdings, while 20%, or 88 individuals, plan to sell their holdings. The remaining respondents indicated they plan on selling a portion of their Bitcoin while choosing to hold the remainder.

Related: Mt. Gox sees $3.2B BTC in outflows in just two hours.

The findings of the Reddit poll were further corroborated by data from CryptoQuant founder Ki Young Ju. The quantitative analyst explained that following the distribution of funds to Kraken users on July 23, 2024 "There has been no significant spike in hourly spot trading volume dominance or BTC outflows on Kraken."

Bitcoin Exchange Outflow Total for Kraken exchange. Source: Ki Young Ju.

Onchain analyst RunnerXBT echoed a similar sentiment, explaining that only those traders with "paper hands" will sell their Bitcoin reimbursement funds and contribute to selling pressure, while those who understand the value of the scarce decentralized asset will continue to hold their funds.

However, financial analyst Jacob King disagrees with this analysis, arguing that up to 99% of the Mt. Gox creditors will sell their Bitcoin, driving Bitcoin's price into bear market territory due to the massive selling pressure and low organic demand.

Bitcoin's price action

Despite the billions in potential sell pressure coming from the Mt. Gox bankruptcy reimbursements, the price of Bitcoin has been fairly resilient.

Snapshot of Bitcoin's price action Source: TradingView.

Following a bevy of political developments, Bitcoin hit a recent high of around $68,000 and is currently trading at around $65,000 despite the ongoing Mt. Gox reimbursement.

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