Weekly Crypto Wrap: 22nd August 2024

TLDR

• Tori West - Australia's Crypto Olympian.
• BTC Markets proudly supports the ASX Refinitiv Markets Day for Charity.
• Learn about crypto with BTC Markets beginners guide.
• It's tax time: watch our latest webinars featuring Crypto Tax Calculator & Syla.
• Spot Bitcoin ETFs record positive flows in 8 of the last 10 days.
• Mt. Gox moves US$700m in Bitcoin: First major transaction in 3 weeks.

BTC Markets announcements

Thank you, Tori West - Australia's Crypto Olympian.

On behalf of everyone at BTC Markets, I want to extend our heartfelt thanks to Tori on her remarkable achievement at the 2024 Olympic Games in Paris.

Her dedication, hard work, and exceptional talent earned her a place on the Australian team.

Tori made history in Paris as one of the first two heptathletes to represent Australia at the Olympic Games in 16 years. She secured her spot after competing in five heptathlons across five different countries in just five months.

Tori qualified for the Olympics while simultaneously building her blockchain business, Equil Labs, which focuses on helping athletes tokenise their sports and health data.

As an Olympian, she understands the financial challenges athletes face and views blockchain technology as a way to unlock new value in sports data, creating real earning opportunities.

Her incredible journey to the Olympics is not only a personal triumph but also an inspiration to all of us at BTC Markets.

Thank you for showcasing the true spirit of Australian athletes with your grace and determination. We're honoured to have supported you on your path to success, and we couldn't be prouder of everything you've accomplished.

Congratulations once again, Tori. - Caroline Bowler, CEO BTC Markets

Read our sponsorship announcement here.

BTC Markets proudly supports the ASX Refinitiv Markets Day for Charity.

BTC Markets is once again proud to support the ASX Refinitiv Markets Day for Charity on Tuesday, 15th October 2024.

This important event has become a key part of Australia’s financial industry, bringing together major players like ASX, NABtrade, Macquarie Bank, Citi, and BTC Markets to raise funds for a wide range of charitable organisations.

The event is not just about trading; it’s about making a tangible difference in the lives of Australians who need it most. Since its inception in 1996, the ASX Refinitiv Charity Foundation has raised over $36 million, with all proceeds going directly to charities that focus on women, children, disabilities, and medical research.

We will donate 100% of our trading profits from the day to a variety of Australian-based charities focused on women, children, disabilities, and medical research.

Join us by trading on this day and help make a difference in the lives of thousands of Australians.

Read more here.

BTC Markets tax webinar featuring Crypto Tax Calculator and Syla.

Unpacking the ATO’s latest guidance on crypto taxes for DeFi with Crypto Tax Calculator.

Our Head of Finance, Charlie Sherry, catches up with Patrick McGimpsey from Crypto Tax Calculator to talk about the latest guidance from the Australian Taxation Office (ATO) on the taxation of Decentralised Finance (DeFi).

Watch the video here.

How to simplify your crypto tax reporting in 2024 with Syla.

Charlie also chats with Syla’s Technology Co-founder, Nick Christie, to address a long-standing challenge for cryptocurrency investors: accurately declaring and managing taxes on their digital assets.

Watch the video here.

BTC Markets partners with Syla for crypto tax reporting solution.

BTC Markets has partnered with Syla to simplify cryptocurrency tax reporting for Australian users. This collaboration integrates Syla's advanced tax reporting solutions, providing a seamless and localised approach to managing crypto taxes.

The partnership addresses the challenge of accurately declaring and managing taxes on digital assets, benefiting both new and seasoned users.

Click here to view the discount codes.

Learn about crypto with BTC Markets beginners guide.

Recently, we announced the launch of our new Learn Section, designed specifically for beginners eager to learn about the world of cryptocurrencies.

At BTC Markets, we understand that the crypto space can be daunting, especially for newcomers. That's why we've created a comprehensive educational hub to help you navigate this vibrant landscape with confidence.

What you’ll find in our Learn Section:

• Introduction to cryptocurrencies: Explore the fascinating world of cryptocurrencies and their potential role in the future of finance.
• Getting started in crypto: Learn the basics about crypto wallets, exchanges and creating an account.
• How to buy and sell crypto: Learn how to buy, sell, and store crypto on an exchange, and secure your assets with best practices.
• How to stay safe in crypto: Stay safe in the crypto space by understanding the common scams and how to avoid them.
• Crypto tax requirements: Understanding the regulatory landscape and tax reporting requirements for crypto.

Visit our Learn Section today and start your journey towards becoming a confident and informed crypto enthusiast. With BTC Markets, the future of finance is at your fingertips.

Explore now.

BTC Markets x Ticker News ‘Crypto Corner’ featuring Maryna Kovalenko.

In this episode Caroline is joined by Maryna Kovalenko, CEO of Syla, an Australian based crypto tax software company. They discuss how Australians can effectively manage their crypto tax reporting.

Syla’s mission is to help users stay compliant with Australian tax rules with features like ‘Lowest Tax First Out (LTFO)’ tax optimisation and accurate transaction classifications.

Watch on YouTube or Ticker News.

Mobile app fiat and crypto withdrawals.

Did you know that you can now easily withdraw fiat and cryptocurrency using our latest mobile app update?

This feature allows you to effortlessly manage your withdrawals and track transfer statuses through a comprehensive history list.

The feature is live in the most recent app release. Update your mobile app from the App Store (iOS) or Google Play Store (Android). Discover more about this exciting mobile app update here.

BTC Markets in the news

Capital Brief: ASIC set to ramp up crypto scrutiny as industry fears licensing regime.

BTC Markets CEO Caroline Bowler said she was not aware of the upcoming guidance note but said ASIC had been very engaged with the industry over recent months and “that’s to be welcomed”.

“What we need is more certainty, we already have lawyers look at everything we do,” she said. “ASIC is doing a good job, its involvement has really picked up, but ultimately we need the new legislation for certainty. And providing confidence for investors and innovators is essential.”

Read the full article here.

State of crypto

The weekly trading stats as of Monday, August 19th at 10:00 am AEST, based on data from Tradingview in USD.

Spot Bitcoin ETFs record positive flows in 8 of the last 10 days.

Spot Bitcoin ETFs in the United States have experienced positive flows for eight of the past ten trading days, accounting for 80% of the last fortnight’s trading sessions. Despite Bitcoin's stagnant price, these ETFs saw significant investor interest, particularly on August 20, when they collectively received US$88 million in inflows.

BlackRock’s iShares Bitcoin Trust (IBIT) led with a US$55.4 million inflow, raising its total net inflow to US$20.5 billion since its January launch. IBIT has consistently attracted investments, with only one outflow day since its inception.

The Ark 21Shares Bitcoin ETF followed closely with US$51.9 million in inflows. In contrast, Grayscale's Bitcoin Trust (GBTC) and Bitwise Bitcoin ETF (BITB) saw net outflows of US$12.8 million and US$6.5 million, respectively. Grayscale's flagship fund has lost US$19.6 billion since converting to an ETF.

Meanwhile, spot Ethereum ETFs have struggled, with five out of the last eight trading days seeing outflows, including US$6.5 million on August 20, led by Grayscale’s Ethereum Trust (ETHE) outflows surpassing BlackRock’s iShares Ethereum Trust (ETHA) inflows.

Source: TheBlock.co

Trade ETH/AUD on BTC Markets.

Mt. Gox moves US$700m in Bitcoin: First major transaction in 3 weeks.

Mt. Gox, the defunct crypto exchange, has moved approximately 12,000 Bitcoin, worth US$709.4 million, to a new, unknown wallet address on August 20, 2024.

This is the most significant Bitcoin transaction from Mt. Gox since July 30, when 47,229 BTC was moved to three unknown wallets over a three-hour period. The recent move includes 1,265 BTC sent to an address labelled as a Mt. Gox cold wallet and has not been touched since.

There is speculation that Mt. Gox might be preparing to distribute Bitcoin to creditors who have been waiting since the exchange’s collapse in 2014. However, Alex Thorn from Galaxy Research suggests that only a portion of the funds (US$74.5 million) might be for distribution, with the remainder possibly going into “fresh cold storage” still owned by the estate.

About 68% of Mt. Gox’s funds have been distributed to creditors so far, but many appear to be holding onto their Bitcoin, possibly due to expectations of future price increases and to avoid immediate capital gains taxes. Mt. Gox still controls around 46,164 BTC, valued at roughly US$2.7 billion.

Trade BTC/AUD on BTC Markets.

Bitcoin mining expenses soar 168% amid capacity growth.

In Q2 2024, BitFuFu, a cloud mining company linked to Bitmain, reported a 168% increase in Bitcoin mining costs, with the average cost per BTC soaring to US$51,887 from US$19,344 in the previous year.

This dramatic rise is attributed to a combination of higher electricity and operational expenses, compounded by the April 2024 Bitcoin halving, which reduced BTC rewards by 50% and increased mining difficulty.

Despite these rising costs, BitFuFu expanded its mining capacity by 62.5%, reaching 24.7 EH/s from 15.2 EH/s a year earlier. The company's total revenue grew nearly 70% to US$129.4 million, up from US$76.3 million in Q2 2023, driven by the expansion of its cloud-mining services.

Matthew Sigel, head of digital assets research at VanEck, explained that the market's recent volatility, including the German government's sale of 49,858 BTC, is part of a “typical seasonal pattern” characterised by “one to three months” post-halving.

Bitcoin staking platform Babylon to begin phased mainnet launch this week.

Bitcoin staking platform Babylon is set to begin its phased mainnet launch on August 22. This initiative aims to introduce staking to Bitcoin, a feature not traditionally available on the network. Babylon, backed by a US$70 million funding round led by Paradigm and headed by Stanford engineering professor David Tse, plans to offer a new utility for Bitcoin holders.

During the first phase, users can lock up their BTC on the network, with a total cap of 1,000 BTC (US$57.9 million) for staking. The project is supported by over 200 "finality providers" who will oversee transactions and ensure protocol operation, similar to validators in proof-of-stake systems. Notable finality providers include Allnodes, Figment, and Galaxy Digital. Babylon's goal is to enhance Bitcoin’s functionality and provide staking rewards, akin to earning interest on savings.

Brazil approves second Solana ETF while U.S. is still waiting.

Brazil has approved its second Solana exchange-traded fund (ETF) this month, signalling growing acceptance of altcoin-based investment vehicles in the country.

The new Solana ETF, offered by asset manager Hashdex, is currently in a pre-operational phase following approval from Brazil’s securities regulator, the Comissão de Valores Mobiliários (CVM). This follows an earlier approval in August for another Solana ETF by QR Asset.

In contrast, the U.S. has yet to see similar progress. While VanEck and 21Shares filed for spot Solana ETFs in June, these efforts appear stalled. Notably, the filings were removed from Cboe Global Markets’ website, suggesting regulatory challenges under the SEC’s current leadership.

Bloomberg analyst Eric Balchunas expressed scepticism about the approval of Solana ETFs in the U.S., citing a lack of regulatory clarity and leadership changes as potential obstacles.

Despite these setbacks, VanEck remains optimistic, with their Digital Asset Research Head, Matthew Sigel, stating that their Solana ETF is still under consideration, although significant regulatory hurdles remain.

Buy SOL/AUD on BTC Markets.

Crypto Fear & Greed Index

Source: alternative.me

The week ahead: economic events

August 22nd: Germany Manufacturing PMI.

August 23rd: Japan Inflation Rate.

August 24th: United States Fed Funds Interest Rate.

August 26th: Germany Ifo Business Climate Index. United States Durable Goods Orders.

August 28th: Australia Monthly CPI Indicator. Germany GfK Consumer Climate.

Source: trading economics

Market reflections

Overview

Australian inflation expectations increased in August, raising concerns about potential rate hikes. Despite rising unemployment, July saw a surge in employment, with participation reaching a record high. Meanwhile, the leading economic index remained flat in July, indicating continued economic stabilisation. On the global front, US consumer sentiment improved in August, with retail sales increasing despite a decline in building permits. China's industrial production slowed in July, while retail sales saw modest growth. Japan's trade deficit widened as Q2 GDP exceeded expectations. The UK economy grew in Q2, and Canada’s inflation eased to the lowest since March 2021.

Australia

• Inflation expectations rise in August, fuelling rate hike concerns.
• Employment surges in July, as participation hits record high despite rising unemployment.
• Leading economic index remains flat in July, signalling ongoing economic stabilisation.

Inflation expectations rise to 4.5% in August, fuelling rate hike concerns.

Consumer inflation expectations in Australia increased to 4.5% in August, the highest since April, reflecting growing inflationary pressures.

This uptick aligns with concerns from the Reserve Bank of Australia (RBA) about persistent inflation, particularly in services, which remains above the target range of 2-3%.

RBA Governor Michele Bullock indicated that interest rate hikes are possible if necessary to curb inflation, though she noted the uneven impact of monetary policy across the economy.

Australia's headline inflation rose to 3.8% in Q2 2024, reversing a nine-quarter low, while the economy saw modest growth of 0.2% in Q4.

Employment surges in July, as participation hits record high despite rising unemployment.

Australia's employment surged in July, significantly surpassing market expectations. This marks the largest employment gain since February, driven by a strong rise in full-time employment, while part-time employment declined slightly.

Over the past year, employment has grown, but despite these gains, the seasonally adjusted unemployment rate edged up to 4.2%, the highest since January 2022, as the number of unemployed individuals rose.

The labour force participation rate reached a record high of 67.1%, reflecting a highly active workforce, while the underemployment rate decreased to 6.3%. Additionally, total monthly hours worked increased by 0.4%.

Leading economic index remains flat in July, signalling ongoing economic stabilisation.

The Westpac-Melbourne Institute Leading Economic Index for Australia remained unchanged in July, marking the fourth consecutive month of muted performance.

The six-month annualised growth rate of the index, which forecasts economic activity trends three to nine months ahead, increased slightly to 0.06%. Despite this modest uptick, the overall economic outlook appears stable rather than recovering, with recent sharp declines in commodity prices suggesting potential further weakening in momentum for August.

GDP growth is projected to be 0.8% annualised for the first half of 2024, with a slight improvement expected in the second half and into early 2025, but overall growth is anticipated to remain subdued at a 2.2% annual rate. Senior economist Matthew Hassan noted that inflation updates will be crucial for future central bank policy decisions.

Global

• US consumer sentiment improves, with retail sales up, though building permits decline.
• China’s industrial production slows in July, while retail sales experience slight growth.
• Japan’s trade deficit expands in July as Q2 GDP growth beating expectations.
• The UK economy expands in Q2 2024, driven by higher retail sales.
• Canada’s annual inflation drops to 2.5% in July, the lowest since March 2021.

United States

Consumer sentiment rises in August, first increase in five months.

The University of Michigan's consumer sentiment index for the US rose to 67.8 in August, up from 66.4 in July and surpassing forecasts of 66.9, according to preliminary estimates.

This marks the first increase in five months. Expectations improved across both personal finances and the five-year economic outlook, with the latter reaching its highest level in four months.

The expectations index rose to 72.1, while the gauge for current economic conditions slightly declined to 60.9. Meanwhile, inflation expectations remained stable, with year-ahead and five-year projections holding steady at 2.9% and 3%, respectively.

Retail sales jump 1% in July, marking strongest gain since January 2023.

US retail sales surged by 1% month-over-month in July, rebounding from a revised 0.2% decline in June and far exceeding forecasts of a 0.3% increase.

This marks the largest monthly rise since January 2023. The data, which is not adjusted for inflation and focuses mainly on goods, highlights a strong consumer spending rebound in July.

Building permits drop 4% in July, hitting four-year low amid widespread regional declines.

US building permits decreased by 4% in July, the lowest level in four years and below market expectations.

China

China's industrial production slows to 5.1% in July, while retail sales see modest acceleration.

China's industrial production grew by 5.1% year-on-year in July, slightly below market expectations of 5.2% and easing from June's 5.3% growth.

This marks the third consecutive month of slowing industrial output, with manufacturing and utilities contributing to the deceleration amid a fragile economic recovery.

Despite this, 33 out of 41 major sectors saw growth. On a monthly basis, industrial activity increased by 0.35%.

Meanwhile, China's retail sales expanded by 2.7% year-on-year, exceeding forecasts and recovering from June's 17-month low. Retail activity also grew by 0.35% month-on-month, following a slight dip in June.

Japan

Japan's trade deficit widens in July as imports outpace exports.

Japan's trade deficit widened in July, up from a year earlier and exceeding market expectations of a shortfall. This marks the fifth trade deficit of the year, driven by a significant increase in imports, which surged by 16.6% year-on-year, the highest in 19 months and surpassing forecasts of a 14.9% rise.

Exports also grew by 10.3%, marking the eighth consecutive month of growth but falling short of market predictions of an 11.4% increase.

Japan's Q2 GDP growth surpasses expectations with strong private consumption and investment boost.

Japan's GDP grew by 0.8% quarter-on-quarter in Q2 2024, exceeding market expectations of 0.5% and marking a strong recovery from a 0.6% decline in Q1.

This was the highest quarterly growth since Q1 2023, driven by a 1.0% rise in private consumption, the first increase in five quarters, following significant wage hikes.

Business investment also rebounded by 0.9%, supported by strong corporate earnings and a recovering automotive sector.

Government spending rose modestly, while net trade slightly detracted from overall growth as import gains outpaced exports.

United Kingdom

UK economy grows in Q2 2024, with services leading the charge despite industrial decline.

The UK economy expanded by 0.6% quarter-on-quarter in Q2 2024, in line with market forecasts but slightly down from the 0.7% growth seen in Q1.

Services drove the expansion, growing by 0.8%, however, industrial production dipped by 0.1%, as construction also saw a slight contraction.

On the expenditure side, gross fixed capital formation rose by 0.4%, while government consumption surged by 1.4%, offsetting a slight decrease in household spending.

Year-on-year, the economy grew by 0.9%, the strongest annual growth since Q3 2022. However, the economy stalled in June, with services output falling by 0.1%, though industrial production and construction both posted gains.

Net trade remained a drag on growth due to declining exports.

UK retail sales rise 0.5% in July, buoyed by non-food stores and summer discounts.

UK retail sales increased by 0.5% month-over-month in July, recovering from a revised 0.9% drop in June and aligning with market expectations.

Over the three months to July, retail trade grew by 1.1%, while on a yearly basis, retail sales jumped by 1.4%, recovering from a 0.3% decline in the prior period.

Canada

Canada’s annual inflation eases to 2.5% in July, lowest since March 2021.

Canada's annual inflation rate declined to 2.5% in July, down from 2.7% in June, aligning with market expectations and marking the slowest increase in consumer prices since March 2021.

This drop is consistent with the Bank of Canada’s forecast for inflation to ease toward 2.5% in the latter half of the year, though a potential rebound is expected due to base effects in gasoline prices.

Additionally, core inflation measures—median and trimmed-mean—came in below expectations, reinforcing dovish outlooks for the Bank of Canada. On a monthly basis, the Canadian CPI increased by 0.4%.

Scam awareness

What are P2P crypto scams and how to avoid falling victim to them.

What are P2P crypto scams?

At BTC Markets, your safety and security are our top priorities. We have noticed a concerning trend where scammers and money mules are increasingly using peer-to-peer (P2P) cryptocurrency platforms to bypass banking and exchange safeguards.

What is a P2P crypto platform?

A peer-to-peer (P2P) cryptocurrency platform is a decentralised platform that facilitates direct transactions between buyers and sellers. This happens without the need for an intermediary or central authority, such as a traditional exchange.

Read the full blog here.

The ASIC provides a checklist of common scams and ways to avoid them. To learn more, visit ASIC’s website.

Discover more on our ‘Compliance conversation’ blog page, where we share the latest updates on safeguarding against scams and protecting your assets. Stay informed and stay protected!

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Disclaimer: The information provided on this page is issued by BTC Markets Pty Ltd (BTC Markets, we, us, our). The information is general only and is not intended to constitute an opinion or recommendation with respect to its contents. Past performance is not a reliable indicator of future performance. Any reference to past performance is intended to be for general illustrative purposes only. The information cannot be relied upon for any purposes and is not intended to be a substitute for professional advice.

The information does not purport to be complete, accurate or contain all of the information that a person may require to make a decision. It may also contain forward looking statements, which are subject to known and unknown risks, uncertainties, and other factors. We recommend you obtain professional advice before making any decision with respect to the matters discussed in this document. To the maximum extent permitted by law, BTC Markets will have no liability for any loss or liability of any kind: (i) arising in respect of the information contained (or not contained) on this page; or (ii) arising from a person relying on any information or statement contained on this page. The information provided is only intended for recipients in Australia. This information cannot be reproduced without our prior written permission.

Weekly prices are accurate as of 10:00 AM AEST on 19/08/2024.