WuBlockchain Weekly: Bitcoin Spot ETF Sees Net Outflows for Four Consecutive Days, US SEC Pushes to Classify Ethereum as Security, Japan Raises Interest Rates and Top10 News

1. Federal Reserve’s FOMC Maintains Interest Rates link

The Federal Reserve has once again maintained the benchmark interest rate within the range of 5.25% to 5.50% for the fifth consecutive time, aligning with market expectations. The Fed’s latest projections indicate a median expectation of 2.6% for core PCE inflation by the end of 2024, up from the previous estimate of 2.4%. Nine Fed officials anticipate two interest rate cuts or fewer by the end of 2024.

2. Bank of Japan Announces First Rate Hike in 17 Years link

The Bank of Japan has announced its first interest rate hike in 17 years. The central bank has raised the benchmark interest rate from -0.1% to 0–0.1%, marking the first rate hike since 2007. This move ends the era of negative interest rates that has lasted for 8 years and signifies Japan’s shift away from the loose monetary policy adopted over the past decade to implementing measures aimed at combating deflation.

3. Japan’s GPIF, the World’s Largest Pension Fund, Collecting Information on Bitcoin link

The Government Pension Investment Fund (GPIF), the world’s largest pension fund with assets under management of approximately 225 trillion yen, has publicly solicited information regarding Bitcoin to consider diversifying its investment portfolio. The institution is currently invested in traditional assets and alternative assets such as stocks, bonds, infrastructure, and real estate. They aim to gather basic knowledge about these assets as well as investment cases from overseas pension funds. This move is intended to prepare for potential future expansions in investment but does not signify a decision to broaden the investment scope has been made.

4. Bitcoin Spot ETF Sees Four Consecutive Days of Net Outflows link

After experiencing prolonged net inflows, as of Friday’s drafting, Bitcoin spot ETFs have seen four consecutive days of net outflows. Yesterday (March 21st, Eastern Time), Bitcoin spot ETFs had a total net outflow of $93.85 million, while Grayscale’s GBTC ETF saw a single-day net outflow of $358 million, bringing GBTC’s historical net outflow to $13.63 billion. The Bitcoin spot ETF with the highest single-day net inflow yesterday was BlackRock’s IBIT ETF, with a net inflow of $233 million, bringing IBIT’s total historical net inflows to $13.32 billion. Currently, the total net asset value of Bitcoin spot ETFs stands at $53.76 billion, with an ETF net asset ratio (percentage of market value relative to total Bitcoin market value) of 4.18%, and a historical cumulative net inflow of $11.32 billion.

5. US SEC Considers Legal Action to Classify Ethereum as a Security link

The U.S. Securities and Exchange Commission (SEC) initiated its investigation into the Ethereum Foundation, headquartered in Switzerland, shortly after Ethereum’s transition to a new governance model with proof-of-stake (POS) in September 2022. The Ethereum Foundation has been subpoenaed in recent weeks as part of this investigation. The SEC is actively pursuing legal action, seeking to classify Ethereum as a security.

On March 21st, during a press conference in Taipei, Vitalik declined to answer questions about the SEC investigation that occurred the previous day and instead offered a prolonged gaze to the journalist. DLNEWS noted that the questions at the press conference were collected by an organizer from ETHTaipei, making it difficult to follow up or seek clarification.

6. BlackRock Officially Launches Tokenized Asset Fund on Ethereum Network link

BlackRock has officially launched its tokenized asset fund on the Ethereum network and has made a strategic investment in asset tokenization company Securitize. The fund, named the BlackRock USD Institutional Digital Liquidity Fund, is represented by blockchain-based BUIDL tokens and is fully backed by cash, U.S. Treasury bonds, and repurchase agreements. It will distribute daily returns to token holders via blockchain. Securitize will serve as the transfer agent and tokenization platform, while BNY Mellon will act as the custodian of the fund’s assets.

7. Bloomberg Analysts Predict Rejection of Current Round of Spot Ethereum ETF Applications on May 23 link

Bloomberg analyst James Seyffart suggests that the likelihood of approval for Ethereum ETFs in May has diminished, with the final decision expected to be rejected on May 23. This is attributed to a perceived lack of engagement between U.S. regulatory agencies and potential issuers of these products. Previously, Seyffart and another Bloomberg analyst, Eric Balchunas, estimated a 35% chance of approval in May. Currently, there are seven issuers looking to launch Ethereum funds: BlackRock, Fidelity, Invesco with Galaxy, Grayscale, VanEck, 21 Shares, and Ark, as well as Hashdex.

8. Nigerian High Court Orders Binance to Disclose All Nigerian User Data link

The Nigerian authorities have intensified their scrutiny of Binance, with the Federal High Court ordering Binance to provide detailed information about all its Nigerian users to the country’s foremost anti-corruption agency, the Economic and Financial Crimes Commission (EFCC). It remains unclear whether Binance will comply with the demands of the Nigerian authorities. Previously, the Financial Times reported that Tigran Gambaryan, Binance’s compliance chief, and Nadeem Anjarwalla, its regional manager for Africa, were detained in Nigeria, prompting Nigeria to request information from Binance about its top 100 users in the country and their transaction history over the past six months.

Fox reporter Eleanor Terrett has sought comments from the US State Department regarding the arrest of Tigran Gambaryan, Binance’s financial crime compliance chief, in Nigeria. The US State Department responded, stating, “Our foremost concern is the safety and protection of American citizens abroad. We have received reports of an American citizen being detained in Nigeria. When American citizens are detained overseas, the department will strive to provide all appropriate assistance. For privacy reasons, we will refrain from further comment.”

9. OKX to Cease Services in India Due to Regulatory Reasons link

OKX notified its Indian users on March 21st, requesting them to close their accounts and withdraw their funds by April 30th. The cryptocurrency exchange stated that local regulatory hurdles were the primary reason for this action. Previously, the Financial Intelligence Unit (FIU) under the Indian Ministry of Finance had issued non-compliance notices to nine foreign cryptocurrency exchanges.

10. Prosecutors Urge Judge to Sentence SBF to 40–50 Years in Prison link

The U.S. prosecutors have requested the court to imprison former FTX CEO Sam Bankman-Fried for 40 to 50 years, along with recommending a fine exceeding $11 billion. SBF is scheduled for sentencing on March 28th, with prosecutors emphasizing in a memorandum that his actions demonstrate unparalleled greed and arrogance, as he engaged in repeated gambling with others’ funds. Furthermore, SBF did not cease his criminal activities even after his arrest, thus necessitating a severe sentence. SBF’s attorneys had previously requested a sentence ranging from 63 to 78 months.

Regarding the prosecution’s assertion of the necessity of sentencing SBF to 40 to 50 years in prison, SBF’s lawyers expressed deep concern, claiming that the prosecutor’s filings are disturbing and the memorandum distorts reality with apparent hostility, portraying SBF as a fallen supervillain; attributing dark and narcissistic motives to SBF is contradictory to the record; and adopting a medieval punitive viewpoint, resulting in a sentence recommendation equivalent to a prison death penalty.

Fundraising

• Web3 privacy system Espresso Systems announced the completion of a $28 million Series B financing round, led by a16z. link
• Web3 infrastructure company Succinct announced the completion of a $55 million financing round, with Paradigm leading the investment. link
• Mystiko.Network announced the completion of an $18 million seed round financing, with Peak XV Partners leading the way. link
• Ethereum L2 Morph announced the completion of a $19 million seed round financing. link
• RWA tokenization project MANTRA announced the completion of an $11 million financing, with Shorooq Partners leading the investment. link
• Figure announced the establishment of a new entity after raising $60 million in Series A financing. link
• Ethereum L2 network TEN developer Obscuro Labs announced the completion of a $9 million financing round, led by R3. link
• Dutch cryptocurrency derivatives exchange D2X announced the completion of a $10 million Series A financing round. link
• Self-custodied cryptocurrency trading platform Rails announced the completion of a $6.2 million seed round financing. link
• Moondance Labs announced the completion of a $6 million strategic financing round. link
• STAMP ecosystem project OpenStamp completed a seed round financing at a $50 million valuation. link
• SocialFi project EarlyFans on Blast completed a $1.5 million seed round financing. link
• Asset hedging protocol Umoja announced the completion of a $4 million seed round financing, with participation from Coinbase and others. link
• Hybrid decentralized exchange GRVT announced the completion of a $2.2 million strategic financing round. link
• Cryptocurrency compliance platform Keyring announced the completion of a $6 million financing. link
• Fintech company Kemet Trading announced the completion of a $5 million financing, led by Further Ventures. link

Learn more, check out crypto-fundraising.info.

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