Block 1: Essential news

Worldcoin pinned in Hong Kong

Hong Kong authorities have ordered Worldcoin, Sam Altman's crypto project, to suspend operations for violating personal data collection laws. The investigation revealed that Worldcoin required iris and face scans, a practice deemed excessive and illegal by the Privacy Commissioner. In addition, the lack of translation of the privacy policy into Chinese prevented non-English-speaking participants from understanding the conditions. Worldcoin must review its data collection practices to comply with regulations and relaunch its operations in Hong Kong. Worldcoin has confirmed that more than 8,300 people had their faces and irises scanned during its Hong Kong operations.

The London Stock Exchange opens up to cryptocurrencies

The Financial Conduct Authority (FCA) has authorized WisdomTree to list two ETPs, one on Bitcoin (WisdomTree Physical Bitcoin) and the other on Ethereum (WisdomTree Physical Ethereum), on the London Stock Exchange. These ETPs will be available for trading from May 28, initially reserved for professional investors. This approval could facilitate UK professional investors' access to crypto-currencies, by removing certain regulatory barriers. WisdomTree, which already has a presence in several European countries, hopes to encourage greater institutional adoption of cryptocurrencies in this way.

MAGA: Trump cryptocurrency explodes

MAGA, for Make America Great Again, a memecoin created in the effigy of the former President of the United States is taking off. Launched in August 2023 by fans of the candidate, currently campaigning for the US presidential elections, the token has been attracting speculators since Trump announced he was open to cryptocurrencies to fund his campaign, but also since he has been putting forward pro-crypto arguments. Notably with promises on the right to self-custody of cryptocurrencies and the banning of central bank digital currencies (CBDCs). Since May 10, the MAGA share price has risen by 273%. The icing on the cake is that, according to Arkham Intelligence, Trump's portfolio holds MAGA tokens worth $7.12 million.

BREAKING: Donald Trump now holds $10M in crypto

Donald Trump's on-chain holdings surpassed $10 Million this morning, mainly fuelled by the rise in price of the $TRUMP coin - of which Trump currently holds $7.3M. pic.twitter.com/rkQi6SLvvG

- Arkham (@ArkhamIntel) May 27, 2024

 

Mt.Gox: Towards a $9.6 billion refund?

Mt. Gox has begun repaying its bitcoin creditors, 10 years after its bankruptcy, by transferring over 141,000 BTC, or $9.6 billion, to one address. These massive movements prompted speculation about the potential impact on the bitcoin price, particularly if they were sold. Mark Karpelès, former CEO of Mt. Gox, reassured that these transfers were part of the repayment process and did not involve any immediate sale. Creditors may choose to sell their BTC to take advantage of the spectacular rise since the bankruptcy, but some may also hold on to their funds in anticipation of a future valuation.

Block 2: Crypto Analysis of the week

BlackRock's Bitcoin spot exchange-traded fund (ETF), iShares Bitcoin Trust (IBIT), has overtaken Grayscale's Bitcoin Trust (GBTC) to become the world's largest Bitcoin ETF.

IBIT becomes leader
SoSo Value

As of May 28, IBIT held over $19.68 billion in bitcoin assets, compared with GBTC's $19.65 million. As a reminder, prior to its conversion to a cash ETF on January 11, the GBTC (Grayscale Bitcoin Trust) was a closed-end trust that had been in operation since 2013 before being transformed into an ETF at the same time as those from BlackRock and co. came to market. Naturally, GBTC had a head start in terms of assets under management.

Since January 11, the GBTC has seen funds evaporate by the day. Since then, hundreds of millions of dollars have been leaving the GBTC every day.

GBTC sees investors' funds evaporate
SoSo Value

While BlackRock's IBIT mainly collects funds from investors who want to rub shoulders with the bitcoin price. This time, several hundred million have entered the IBIT since January 11.

IBIT draws in the crowds
SoSol Value

This is largely due to the high fees charged by GBTC.

Whereas IBIT has a management fee of 0.25%, with fees reduced to 0.12% for the first 12 months of trading or the first $5 billion in fund assets, GBTC has a management fee of 1.5%. That's not insignificant for an investor.

Management fees on Bitcoin Spot ETFs
Milkroad

Securities and Exchange Commission filings have revealed that over 600 investment firms in the U.S. have invested in Bitcoin Spot ETFs since their launch in January. Institutions such as Morgan Stanley, JPMorgan, Wells Fargo, Royal Bank of Canada, BNP Paribas, UBS, as well as hedge funds like Millennium Management and Schonfeld Strategic Advisors. Among these firms, Millennium Management has become the largest accumulator of Bitcoin cash ETFs, with $1.9 billion invested.

And BlackRock has no intention of stopping there. The asset management giant has added $4.1 million of its IBIT shares to two of its funds, according to SEC filings on May 28. $3.6 million was added to its "BlackRock Strategic Income Opportunities Portfolio (BSIIX)" and $486,000 worth of IBIT shares to its "BlackRock Strategic Global Bond Fund (MAWIX)".The company also reported holding $6.6 million of IBIT shares in a 13F deposit on May 10.

Such a decision, and all the more so from BlackRock, portends a radical shift in the way traditional investment funds view bitcoin, and cryptocurrencies more broadly. This decision could have a domino effect, prompting other asset managers to consider bitcoin allocations by adding a BTC line corresponding to 1% or 2% to their investment funds.

With investment methods in cryptocurrencies in a state of flux, the market is watching closely as traditional financial institutions such as BlackRock, Fidelity, State Street, Morgan Stanley and others reconsider their stance on the subject. This revaluation could herald a new era of investment in bitcoin, with bitcoin potentially soon to be integrated into various investment funds, which could snowball and increase its value in the medium term. But for the time being, this remains in the realm of speculation, although certain signals inevitably point to financial institutions opening up to crypto-currencies.

Block 3 : A few things to read:

How researchers cracked an 11-year-old password for a $3 million crypto wallet (Wired)

He trained cops to fight crypto crime and allegedly ran a $100 million drug deal on the Dark Web (The Conversation)

The wrong lessons from Pizza Day (Bitcoin Magazine)