Markets and Elon are volatile
Bitcoin and many other crypto projects ended the week sharply lower following a series of tweets from Elon Musk.
In February this year Tesla announced that it would accept Bitcoin as payment. On 13-May Musk posted on twitter a statement indicating that Tesla would no longer be accepting BTC for car payments due to its energy use, particularly its use of fossil fuels. Some were concerned over the amount of due-diligence Tesla had done on its original BTC decision given that the reversal took place just a few months later.
Arguments between Musk and BTC supporters continued where Musk indicated that the company may indeed sell their remaining BTC holdings and that due to the responses on twitter he may now go ‘all-in’ on Doge. The price action from Musk’s tweets and debate on BTC’s energy usage has now become the main focus in the space.
The ABC cited a report from the Cambridge University’s Cambridge Centre for Alternative Finance that showed 61% of BTC mining last year was powered by fossil fuels, with the remaining 39% powered by renewables, mainly hydroelectric energy.
Musk has long championed Dogecoin and has called himself the ‘Dogefather’. However, once his tweets regarding Bitcoin came out, questions arose about his support for Doge as it, like BTC, also uses a Proof-of-Work model to ensure its security. Musk responded that he still supports Doge and is working with developers to make improvements.
- Square confirms its BTC strategy hasn’t changed: Square’s CFO told Financial News that they have no plans to make further BTC purchases, but they are now revaluating where they are from a treasury standpoint.
- Cboe seeks to list Fidelity BTC ETF: Bloomberg reported that Cboe Global Markets filed with the SEC to list Fidelity’s Wise Origin Bitcoin Trust.
- MoneyGram International and Coinme partner to expand access to Bitcoin: Company stated the service will be available at select MoneyGram locations starting in the US in the coming weeks. Additional countries and cryptocurrencies will be made available shortly thereafter.
- CME rolls out micro futures BTC contracts: CME reported that 100K micro contracts (1/10th Bitcoin) traded over the first six days after launch.
- Palantir accepts Bitcoin for payments: CNBC reported that the company now accepts BTC for payments and is considering adding it to its balance sheet.
- eBay Expanding Into NFTs: The company announced that in the short term, NFT inventory will be provided by trusted sellers, across categories like trading cards, music, entertainment and art. In the coming months, eBay will add new capabilities that bring blockchain-driven collectibles to the platform.
Bitcoin (BTC) two week recovery was interrupted. BTC ended the week down -23.2% and Ethereum (ETH) was down -11.3% (vs prior week’s +4.8% and +38.3%, respectively).
Decentralized Finance (DeFi) – Total Value Locked (TVL) declined last week to $74B, -12% w/w and is still up +346% YTD.
DeFi cryptocurrency prices also declined (see below). Total DeFi category market cap also declined last week by -13%, though it is up +501% YTD (i.e. ~ 6x).