Bitcoin, Ether flat; U.S. equities drop as rate hike concerns return
Bitcoin was trading flat below the resistance level of US$26,000 Wednesday morning in Asia. Ether edged up but remained below the US$1,650 mark, while other top 10 non-stablecoin cryptocurrencies traded mixed. Solana led the winners after Visa announced it would expand stablecoin payments to the Solana network. U.S. stock futures traded mixed after a down day Tuesday. Oil supply restrictions from Russia and Saudi Arabia have aroused inflationary concerns and fear among investors of more U.S. interest rate hikes to come.
Solana surges on Visa partnership
Bitcoin edged up 0.01% in the last 24 hours to US$25,764.10 as of 07:10 a.m. in Hong Kong for a weekly loss of 6.72%, according to CoinMarketCap data. The world’s leading cryptocurrency has been trading between US$25,500 and US$26,000 since Saturday. It was trading at the same range in June before U.S. investment giant BlackRock’s Bitcoin exchange-traded fund (ETF) application sent the price over US$30,000
“The market seems to underestimate the potential impact of U.S. BTC spot ETFs. A spot ETF approval should attract enormous inflows, creating significant buying pressure on BTC. Conversely, if the BTC spot ETFs are rejected, nothing changes,” wrote crypto research firm K33 Research in a report Tuesday.
“Prices are now the same as before the Blackrock news that injected new life into BTC spot ETF chances. In the same time span, the Nasdaq 100, often a good indicator of the market’s general risk appetite, is up 2%. The BTC spot ETFs will be huge, and with improved odds of approval, it looks evident that the market is mispricing it,” the report continued.
Digital asset manager Grayscale Investments sent a letter to the U.S. Securities and Exchange Commission (SEC) Tuesday urging the regulator to approve its application to turn the Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF. That followed a favorable court decision on August 29 for the digital asset management firm requiring the SEC to review an application it rejected last year.
“GBTC is ready to operate as a bitcoin ETF upon regulatory approval, and Grayscale looks forward to further constructive engagement with the SEC,” said Grayscale in a Twitter thread on Tuesday.
Justin d’Anethan, head of Asia-Pacific business development at Belgium-based crypto market maker Keyrock, said the resubmission of Grayscale’s request to the SEC for their ETF approval is a reason for optimism. “Again, the arrival of a crypto-linked ETF seems to become more and more likely, although the timeline itself remains iffy,” he said.
Ethereum gained 0.51% to US$1,631.79, down 5.53% for the past seven days. The second largest cryptocurrency has been trading around US$1,640 since the weekend. But K33 analysts said they expect the token’s price to rise in the near future.
“September and October favor overweight exposure in ETH, as ETH carry stronger ETF momentum in the short term,” wrote K33 in Tuesday’s report. “Futures-based ETH ETFs are scheduled to receive their final verdicts in mid-October, with strong chances of approval.”
Nearly a dozen companies including Volatility Shares, Bitwise, Roundhill and ProShares have filed to launch Ethereum ETFs in the U.S.
Other top 10 non-stablecoin cryptocurrencies traded mixed over the past 24 hours. Solana’s SOL led the winners, rising 4.43% to US$20.22 but still posted a loss of 7.19% for the week.
Visa Inc. announced on Tuesday it would expand its USDC stablecoin settlement services to the Solana blockchain. The global payments giant has been supporting USDC settlements on the Ethereum blockchain since March 2021.
“By leveraging stablecoins like USDC and global blockchain networks like Solana and Ethereum, we’re helping to improve the speed of cross-border settlement and providing a modern option for our clients to easily send or receive funds from Visa’s treasury,” Cuy Sheffield, head of crypto at Visa, said in the announcement.
Solana said in a tweet Tuesday that Visa’s addition of the blockchain to its payment network follows an extensive period of planning and infrastructure evaluation.
“The partnership between Solana and Visa is a positive development for the blockchain ecosystem,” said John Stefanidis, CEO of blockchain infrastructure foundation Balthazar DAO.
“It broadens the range of use-cases beyond just Ethereum-based applications. Additionally, Solana offers faster and more cost-effective transactions which makes it a great option for settling transactions internally,” Stefanidis said.
Meanwhile, crypto exchange Coinbase launched a new crypto lending platform for U.S. institutional investors on September 1. The platform has raised over US$57 million in investment, according to a filing with the U.S. Securities and Exchange Commission made Friday.
The platform’s launch follows the bankruptcies of major crypto lenders including Celsius Network, BlockFi and Genesis Global. Those collapses opened up a vacuum in crypto lending services that the new Coinbase platform could come to occupy.
The total crypto market capitalization edged up 0.15% to US$1.04 trillion. Trading volume rose 5.55% to US$25.05 billion.
