Saylor's Billion-Dollar Bitcoin Bet is Paying Off
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Good Morning Investors,
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It's been a noteworthy week in the markets – we are definitely BACK in action. Bitcoin has risen by another 7% this week, while Ethereum has shown a remarkable 13% increase week over week.
As the crypto world buzzes with the anticipation of a U.S. Bitcoin spot price ETF, the market is witnessing remarkable movements. Dan Tapiero, CEO of 10T Holdings, is among the many bulls predicting a significant change in institutional Bitcoin adoption, anticipating a "torrent" of capital inflows.
A Surge in Institutional Interest
The signs of this shift are already evident. Bitcoin's price has soared to 18-month highs, and institutional engagement is intensifying. A key indicator of this trend is the CME Group's Bitcoin futures market overtaking Binance in open interest – a first of its kind shift that Tapiero describes as a "watershed moment." This leap in aggregate Bitcoin futures open interest, reaching $17 billion, underscores the growing institutional fascination with Bitcoin.
The Optimism for an ETF Approval
The potential approval of a spot Bitcoin ETF, expected as early as 2024, has sparked widespread optimism. This enthusiasm is not just limited to Bitcoin, but also the potential of a spot Ether ETF boosting the crypto market. While some caution is advised due to a series of lower highs on Bitcoin’s daily relative strength index (RSI), the overall market sentiment remains bullish.
Michael Saylor’s Mammoth Bitcoin Holdings
Amidst these market dynamics, Michael Saylor's MicroStrategy has emerged as a colossal player. The company's more than 158,000 Bitcoin holdings have brought in over $1.1 billion in unrealized gains, a staggering 25% more than their total investment. With the value of these holdings comprising over 80% of MicroStrategy’s market cap, Saylor's aggressive investment strategy in Bitcoin is paying off. The total value of Microstrategy’s Bitcoin is estimated to surpass $4.6 billion.
As we observe the Bitcoin price crossing significant thresholds, the company's recent acquisitions under Saylor's guidance have only added to the momentum. These moves, coupled with the broader market's anticipation of U.S. regulatory approvals for Bitcoin ETFs, paint a picture of a market on the cusp of a major institutional embrace.
The crypto market's trajectory seems increasingly intertwined with institutional acceptance, and the days ahead promise to be pivotal in shaping its future landscape.
This Week By the Numbers 📈
Bitcoin has surged an impressive 124% this year
The Dow Jones Industrial Average made a strong comeback on Friday, leaping nearly 400 points as the market rebounded, buoyed by the stabilization of Treasury yields
In a major security breach, Tron founder Justin Sun's cryptocurrency exchange, Poloniex, was hacked, resulting in a loss of over $100 million
Bitcoin reached an all-time high of $69,044 exactly two years ago today
BlackRock, the asset manager overseeing $9 trillion, filed for a Spot Ethereum ETF with Nasdaq
BlackRock anticipates the approval of its Spot Bitcoin ETF by the SEC by January.
SEC Chair Gary Gensler has indicated that the FTX crypto exchange could experience a revival under new leadership
Moody's Investors Service revised the U.S. credit rating outlook from “stable” to "negative," signaling caution amidst economic uncertainty
The demand for CryptoPunk NFTs has risen sharply, with the floor price reaching $120k amid a flurry of buying activity
Top Stories 🗞️
Leading AI and metaverse company Futureverse is taking a significant step toward transforming the creator economy by partnering with NVIDIA, a leading tech company specializing in gaming, creative design, autonomous vehicles, and robotics. Futureverse aims to harness the power of NVIDIA’s DGX H100, the world’s leading AI supercomputer. Over the past five years, Futureverse has developed a comprehensive suite of AI and web3 tools poised to usher in a new era for content creators as part of NVIDIA’s Inception Program. These tools will empower creators across various fields, including artists, filmmakers, designers, and individuals with limited tech expertise, by integrating AI into their creative and production processes. The result is enhanced quality and efficiency in content creation, offering a glimpse into a future where generative AI fuels personalization and customization.
Speaking a little more than a week after the central bank voted to hold benchmark policy rates steady, Powell said in remarks for an International Monetary Fund audience in Washington, D.C., that more work could be ahead in the battle against high prices. “The Federal Open Market Committee is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2 percent over time; we are not confident that we have achieved such a stance,” he said in his prepared speech. The speech comes with inflation still well above the Fed’s long-standing goal but also considerably below its peak levels in the first half of 2022. In a series of 11 rate hikes that constituted the most aggressive policy tightening since the early 1980s, the committee took its benchmark rate from near zero to a target range of 5.25%-5.5%.
China’s ICBC, the world’s biggest bank, hit by cyberattack that reportedly disrupted Treasury markets
The U.S. financial services division of Chinese bank ICBC was hit with a cyberattack that reportedly disrupted the trading of Treasurys. Industrial and Commercial Bank of China, the world’s largest lender by assets, said Thursday that its financial services arm, called ICBC Financial Services, experienced a ransomware attack “that resulted in disruption to certain” systems. Immediately after discovering the hack, ICBC “isolated impacted systems to contain the incident,” the state-owned bank said. Ransomware is a type of cyberattack. It involves hackers taking control of systems or information and only letting them go once the victim has paid a ransom. It’s a type of attack that has seen an explosion in popularity among bad actors in recent years.
The Celsius bankruptcy plan has been approved. The path is now clear for customers to see some of their funds returned and receive shares in the reorganized company, which will be called NewCo. Judge Martin Glenn of the Southern District of New York Bankruptcy Court issued a confirmation on Nov. 9 that the bankruptcy plan was approved by Celsius creditors overwhelmingly on Sept. 27. Under the plan, around $2 billion in Bitcoin and Ether will be redistributed to Celsius creditors along with equity in NewCo. The company has said it hoped to begin reimbursement of creditors by the end of the year. NewCo will expand the existing mining operations of former crypto lender Celsius. It will also monetize illiquid Celsius assets and conduct other developmental activities, subject to regulatory approval. NewCo will be managed by the Fahrenheit consortium, made up of several crypto-native persons and organizations. One of the consortium members is Proof Group, which is reportedly also bidding for FTX.
HSBC announced that it plans to launch a new digital assets custody service for institutional clients who invest in tokenised securities. Once live in 2024, HSBC’s new digital assets custody service will complement HSBC Orion, the bank’s platform for issuing digital assets, as well as HSBC’s recently launched offering for tokenised physical gold. Together, these form a complete digital asset offering for HSBC’s institutional clients. HSBC is working with Swiss enterprise tech firm, Metaco, to use its institutional platform, Harmonize, as part of HSBC’s new custody service for digital assets. Metaco’s Harmonize solution helps unify security and management of digital asset operations.
Deal of the Week 💰
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About the Author: Tatiana Koffman
Hi there and thanks for reading! If you stumble upon my newsletter, you will notice that I write about money, economics, and technology. I hold a JD/MBA and spent my career in Capital Markets working across Mergers & Acquisitions, Derivatives, Venture Capital, and Cryptocurrencies. I write to make financial topics more accessible and create equal opportunity for the next generation of investors. I have personally invested in 20+ companies and funds (👉 my portfolio).