As at 8 October, bitcoin was trading at US$27,933, up over the last 7 days. However, the broader crypto market remained predominantly flat. Ethereum underperformed bitcoin, down 2.96% vs bitcoin’s 2.88% increase. Bitcoin’s market capitalisation increased to US$544.9 billion, with the total crypto market cap sitting at US$1.09 trillion. Bitcoin’s market dominance is up to 49.9%.
| Price | High | Low | Change from previous week | |
| BTC (in US$) | $27,933 | $28,434 | $27,088 | 2.88% |
| ETH (in US$) | $1,630 | $1,737 | $1,613 | -2.96% |
Source: CoinMarketCap. As at 8 October 2023. Past performance is not indicative of future performance. Performance is shown in US dollars and does not take into account any USD/AUD currency movements.
Source: Glassnode. Past performance is not indicative of future performance.
Crypto news we’re watching
ETH futures ETFs make debut
Ethereum-based exchange traded funds (ETFs) recently made their debut in the US, however trading fell well short of expectations. Nine ETFs in total were launched on the same day. Combined trading volume for these funds was only US$6.6 million on opening day, which pales in comparison to the ProShares Bitcoin Strategy ETF, which attracted over US$1 billion in assets on its first two days of trading in October 2021.
Bradley Duke, chief strategist at ETC Group commented: “Like any security, success or failure cannot be measured on the first days of trading, with market sentiment and the macro environment all having a bearing on performance“1.
‘Special privileges’ for Alameda account on FTX
Former FTX executive and Chief Technology Officer Gary Wang testified against founder and CEO of FTX Exchange, Sam Bankman-Fried (SBF) on behalf of the US government last week. He testified that Alameda, a crypto hedge fund associated with FTX, had “special privileges” that allowed it to spend US$8 billion of customer’s money. Under SBF’s direction, Wang wrote code to ensure Alameda’s account balance never fell below zero, providing it with a unique advantage. Wang is the first of three witnesses who have pleaded guilty to financial crimes and are testifying against Bankman-Fried in his trial. The government alleges that complex financial arrangements between the two companies enabled them to fraudulently take billions from FTX customers2.
Former CEO of hedge fund Alameda Research, Caroline Ellison, a former girlfriend of SBF, is likely to be the next witness to testify on behalf of the government in its trial against SBF.
Marathon mines 1,242 BTC in September 2023 and 8,610 BTC year-to-date
According to a recent press release on the Marathon Digital Holdings website, the company’s CEO Fred Thiel announced an increase in bitcoin production to 1,242 BTC in September, up 16% from the previous month, and up 245% from the same month last year3. Improved uptime and reduced curtailment in Texas contributed to the boost from August.
Marathon’s share of the bitcoin network’s miner rewards reached a record 4.3%, up from 3.7% the previous month. Additionally, the company opportunistically retired a significant portion of convertible debt at a discount in September, enhancing shareholder value and positioning Marathon to navigate potential turbulence in the bitcoin mining sector ahead of the next halving. Thiel emphasised that the strengthened balance sheet allows them to focus on efficiency and cost reduction.
The bitcoin miner currently sits in the top 10 of the Betashares Crypto Innovators ETF (ASX: CRYP).
On-chain metrics
Bitcoin: Percent Balance on All Exchanges
This metric displays the percentage of total supply held on exchange addresses.
According to data from Glassnode, bitcoin supply on exchanges is at a 5-year low, sitting close to 11.77% or 2.29 million BTC. Historically, outflows from exchanges are perceived as a bullish sign as it could be an indication that investors are more inclined to hold the asset, in addition to reduced selling pressure.
Source: Glassnode. Past performance is not indicative of future performance.
This metric shows the current estimated number of hashes required to mine a block.
According to data from Glassnode, mining difficulty has continued to increase and currently sits at a 5-year high.
Source: Glassnode. Past performance is not indicative of future performance.
Altcoin news
A federal judge denied the US Securities and Exchange Commission (SEC) permission to appeal her recent ruling on Ripple Labs, marking a setback for the SEC in regulating cryptocurrency markets.
The SEC sought to appeal findings related to ‘programmatic’ sales of XRP and other distributions as payments. The judge indicated there was no substantial difference of opinion and that an appeal would not significantly advance the case4.
Investing in crypto assets or companies servicing crypto-asset markets should be considered very high risk. Exposure to crypto assets involves substantially higher risk when compared to traditional investments due to their speculative nature and the very high volatility of crypto-asset markets.
Investing in crypto assets or crypto-focused companies is not suitable for all investors and should only be considered by investors who (i) fully understand their features and risks or after consulting a professional financial adviser, and (ii) who have a very high tolerance for risk and the capacity to absorb a rapid loss of some or all of their investment. Any investment in crypto assets or crypto- focused companies should only be considered as a very small component of an investor’s overall portfolio
References:
1. https://www.ft.com/content/64249786-47e2-49db-989b-8870317d45b3
2. https://www.coindesk.com/policy/2023/10/06/sam-bankman-fried-ordered-special-privileges-for-alameda-ftx-co-founder-gary-wang-testifies/
3. https://ir.mara.com/news-events/press-releases/detail/1327/marathon-digital-holdings-announces-bitcoin-production-and
4. https://www.reuters.com/legal/us-sec-cannot-appeal-ripple-labs-decision-judge-rules-2023-10-04/
Past performance is not indicative of future performance.
Off the Chain is published every second Tuesday. It provides the latest news on bitcoin and the rest of the crypto market, along with analysis and insights into the world of crypto.
It provides general information only and is not a recommendation to invest in any crypto asset, crypto-focused company or investment product.
This article mentions the following funds
Written by
Justin Arzadon
Director, Adviser Services & Head of Digital Assets.
C4 Certified Bitcoin Professional (CBP) and Blockchain Council Certified Bitcoin Expert™ with over 18 years’ experience in the ETF market. Passionate about the future of money.
Read more from Justin.