Crypto Scoop: Bitcoin Dips To $38,500 Before Rebounding At $40,000

Amidst the recent market volatility and regulatory shifts, this Crypto Scoop edition reviews the following:

• Price moves of top cryptocurrencies.
• SEC’s postponement of Ethereum ETF decisions
• Crypto ownership growth in 2023. 

Price Moves of Top Cryptocurrencies

Bitcoin (BTC) experienced a significant dip, dropping below the $40,000 threshold for the first time since early December. The decline, down to $38,500 on Tuesday, was attributed to Grayscale's ongoing market activity, with the company reportedly offloading about 100,000 BTC. 

Coinglass reported that there had been $225 million in liquidation within the 24 hours. However, the price dip seemed temporary as BTC rebounded at $40,000 while ETH traded at $2,300.  

Meanwhile, Dogecoin saw a positive turn of events as it reached a seven-day high following the creation of the "XPayments" account on X (formerly Twitter). This account gained over 100,000 followers within a day. Dogecoin's value increased by 12.8% within a nine-hour window between late Jan. 20 and early Jan. 21, reaching $0.08978. While the XPayments account is yet to make a post, traders speculated that Dogecoin could be part of the payment functions due to occasional mentions by X's owner, Elon Musk.

SEC pushes decision on BlackRock’s spot Ethereum ETF to March

The Securities and Exchange Commission (SEC) has postponed its decision on BlackRock's proposed spot Ethereum (ETH) exchange-traded fund (ETF) to March, a day ahead of the initial deadline. The delay was attributed to the SEC's need for additional time to review the proposed rule change thoroughly. In a filing on January 24, Sherry Haywood, the SEC's assistant secretary, stated that it was deemed appropriate to extend the timeframe for taking action on the proposed rule change.

This delay, occurring one day before the January 25 deadline, marks the first of several postponements the SEC can employ within a 240-day period. While the SEC is obligated to make a final decision on BlackRock's spot Ethereum ETF by August 7, Eric Balchunas, an ETF analyst at Bloomberg, anticipates that final decisions on all pending spot Ethereum ETFs will likely be made in May. This projection is reminiscent of the SEC's approach in deciding on 10 pending spot Bitcoin ETFs on January 10.

Crypto Ownership Soared to 580 Million in 2023

A recent report reveals that the global number of cryptocurrency owners witnessed a significant surge of 34% in 2023, reaching a total of 580 million by December. The report, presented by Crypto.com in its annual Crypto Market Sizing Report, highlights notable increases in Bitcoin and Ethereum ownership, with a 33% rise for Bitcoin and a steeper 39% increase for Ethereum.

Key drivers behind the growth in Bitcoin adoption were identified as the approval of spot Bitcoin exchange-traded funds (ETFs) and the implementation of the Bitcoin Ordinals protocol. This protocol played a crucial role in enabling the minting of both non-fungible tokens (NFTs) and fungible tokens on the Bitcoin network. Additionally, strong institutional interest contributed to the overall growth in bitcoin ownership.

The report acknowledges that despite various macroeconomic challenges, such as monetary tightening by Western central banks, conflicts in Europe and the Middle East, and the lingering impacts of the pandemic, the number of global cryptocurrency owners continued to rise.

For Ethereum, the report attributes the adoption growth to liquid staking following Ethereum's Shanghai Upgrade. This upgrade allowed for the withdrawal of staked Ethereum after the transition to the Proof of Stake (PoS) blockchain.