Warning: Can Coinbase Handle Surging BTC Demand?
GM friends!
Where to start this week?
Crypto markets continue to heat up and memecoins are either making people rich or driving them crazy.
But let’s begin with a look at BTC definitively pushing through all-time highs, and take in some concerns around Coinbase breaking down at critical moments.
Here’s what’s in today’s issue:
- Sam shares his thoughts on BTC breaking 70k, Coinbase faltering again, a Bitcoin Ordinal selling for 8 BTC, AI, memes and gaming dominating, ETH ETF updates & Optimism’s private token sale.
- Week 4 updates for my 10x Portfolio.
- This week on chain.
- This week’s trending coins by Rebecca.
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BTC Breaks 70K After Coinbase Falter
After tapping repeatedly at the 70K mark, bitcoin has finally made a strong break into new highs, bringing the surge of excitement that can only come from being in entirely new price territory.
It’s an exhilarating start to the week, and a welcome relief from the last couple of weeks, which saw BTC very briefly touching new highs before immediately correcting back down again. What’s more, this prior price action had come as Coinbase experienced faults, with some users finding their accounts temporarily displaying a zero balance just as new highs were being tested.
As these malfunctions happened three times in quick succession, and prevented trading–with the last occurrence being last Friday–there was speculation on crypto Twitter (where nothing is ever taken at face value) that Coinbase was doing it deliberately and executing a circuit breaker just when prices were pumping.
On the other hand though, there were reassurances that these were just good old fashioned technical issues, with Matt Hougan, the CIO of Bitwise, tweeting that the problems were similar to those Facebook went through in its early years, and so far this week, Coinbase is holding up fine.
Biggest Ever Bitcoin Ordinal Sells for 8 BTC
Ordinals are like NFTs on Bitcoin, and have only been around since the beginning of 2023, but the Ordinals ecosystem is attracting growing attention as BTC itself surges, and although key collections have seen prices dip lately, this comes after significant gains.
What’s more, the Ordinals space received another injection of hype last Friday, with the auction of an item called The Runestone. This was created by a key Ordinals pioneer known as Leonidas, working with Paris-based sculptor Leo Caillard, and it sold, after a bidding war, for a hefty 8 BTC (which is well over half a million dollars), to traders Buoyant Capital.
The block on which The Runestone is inscribed is the largest block in Bitcoin history, and the file size of The Runestone itself makes it the largest ever Ordinals inscription.
All in all then, it’s a weighty digital object, and is important because it’s part of the incoming Runestones airdrop (also led by Leonidas), which will see 112,383 Ordinals items (called Runestones) delivered to wallets that were using the Ordinals protocol in its early days.
AI, Memes and Gaming Dominate
The crypto markets have been chaotic–in the best possible sense–as BTC prints new all-time highs, but away from the orange coin itself, it’s AI coins and memecoins that have grabbed attention and put in the biggest returns, while gaming coins are also looking good.
AI and Gaming
Besides major AI coins such as RNDR and FET performing well, there are multiple smaller contenders gaining increased attention after making solid moves, including the likes of PALM, PAAL, and GPU, which are showing how new coins can sometimes start to shift from being microcaps to being grouped in with altcoins.
Also acting as a potential catalyst for AI coins to make further gains, there is NVIDIA’s 2024 GTC AI conference, coming up from March 18th to 21st, an event that may put further attention on to the AI industry.
And as for gaming, this has been long tipped as a bullish crypto sector for 2024, and we’re seeing plenty of price action to back that up, with coins such as BEAM, GALA and PRIME performing explosively.
Memes Get Weirder
Turning our attention to memecoins, PEPE briefly topped a $4 billion market cap at the weekend, and on Solana, WIF hit a new ATH. And on the whole, Solana is becoming a hub for degen meme-gambling, with, among others, WEN, POPCAT and ZYN all making moves, while on Avalanche, COQ and TECH are among the leaders.
We’ve also seen the rise of a weird new niche (again on Solana), which is badly-drawn-misspelled-famous person-coins. These are almost all based on politicians, with the likes of doland tremp and jeo boden leading the pack (check DEX Screener for the full depths of this madness.)
What’s more, this has led to suggestions that–in a US election year–memecoins could function as political prediction markets. But how do you feel about this, can memecoin activity really offer insights into political sentiment? Reply to this email and let us know what you think.
ETH ETF: Coinbase and Grayscale Meet With SEC
Applications for spot ETH ETFs are in the process of being evaluated by the SEC, and last week, Grayscale and Coinbase met with the regulatory commission to try and push forward the case for approval.
The meeting included a presentation by Coinbase outlining five key points supporting the viability of spot ETH ETFs, with supporting data also included.
Ethereum Hard Fork Incoming
Besides speculation about ETFs, the other major news around Ethereum is the upcoming Dencun hard fork. This is scheduled to take place on March 13th, and it will reduce transaction costs on Ethereum Layer 2s.
If you’re ETH-skeptic, you might point out that it’s regular gas fees that are the problem, not gas fees on Layer 2s, but what Dencun should do is provide better data storage and make the whole structure–mainnet and Layer 2s–more efficient.
Optimism $89 Million Private Token Sale
Optimism Foundation, the developers of the Optimism Layer 2 solution, announced last Friday that it was entering into a private sale of around 19.5 million OP tokens.
This comes–at current prices–to almost $90 million, and represents a not-insignificant chunk of the current circulating supply, which is just over 1 billion tokens.
According to the foundation, the tokens–which come from the OP token treasury–are subject to a two-year lock up, but can be delegated to third parties for governance purposes.
However, the identity of the buyer and the terms of purchase are not being disclosed, and this part of the deal has led to concerns about a lack of transparency, including from Daily Gwei founder Anthony Sassano.
Week 4 Crypto Portfolio Updates
The total portfolio is looking good this week. We are up 45% with our biggest winner thus far being the meme coin COQ INU. It is almost 250% in profit.
Chainflip is #2 at 75% profit. Just riding everything for now. No need to rebalance anything yet or take profits and add a new coin.
Lots of airdrops could be coming up soon which would provide a nice boost to the portfolio.
For example: Apparently NIM Network will be the first rollapp on Dymension with 9% of the supply dropped to DYM stakers. Could be our first win.
There are a few other likely airdrops coming too. Will keep you posted.
Free Airdrops (confirmed)
Nyan Heroes is a cat mech fighting game. Big backers. AND, most importantly a confirmed airdrop which is FREE to participate in.
- Step 1: Go Here
- Step 2: Enter Code “TheCryptoLark”
- Step 3: Do all the free tasks
- Step 4: Wait for week two free tasks
These games have had some insane airdrops recently. This could be the next big one.
I connected my wallet via Lava Network’s RPC, which will put me in line for an airdrop from them when the day comes. Don’t worry they walk you through how to do everything if you also want to do it. It is super easy and free to do! Check it out.
There is a new Xion chain task to do on the free testnet. You need to a mint a free NFT on an app called Moseiki and follow their socials.
Free Testnets (possible airdrops)
I went to Alpha Swap on Aleo and did a transaction.
I made an NFT on Aleo Store.
Everything worked this week. So will keep doing a few transaction per week on the testnet.
I started doing some transactions on the Taiko testnet. To start I had to add the Ethereum Holesky testnet manually to my Metamask.
- Network name: Holesky Testnet
- Network URL: https://ethereum-holesky.publicnode.com
- Chain ID: 17000
- Currency symbol: ETH
- Block explorer URL: https://holesky.beaconcha.in
Holesky Faucet is where I got some testnet ETH.
I then used the official bridge to mint some HORSE.
Then I sent some ETH from Holesky to Taiko’s testnet
I also sent the HORSE tokens from Holesky to Taiko.
I minted a domain name here.
Bought an NFT here.
I minted my own NFT there as well.
Then I sent the NFT I bought from Taiko, back to Ethereum via the bridge.
I did some token swaps here.
I went to ThirdWeb and deployed an NFT contract and a marketplace contract and a token contract.
Other than that just continuing the usual tasks. Doing transactions on Berachain, doing the usual transactions across layer twos.
How fast are the spot BTC ETFs moving?
Well, in the space of just eight weeks, we’ve reached a point where the nine new ETFs hold more BTC than Grayscale, and BlackRock holds more BTC than MicroStrategy, which has been accumulating since August 2020.
We’re also seeing the BTC ETFs continue to catch up with gold ETFs, with the bitcoin products holding around $54 billion in AUM, while gold has over $96 billion in AUM.
That’s 36% for bitcoin, and 64% for gold, a ratio achieved in a very short space of time.
Could this be the beginning of a lasting, perhaps generational shift in attitudes towards investing? A lot of Bitcoiners certainly think so, and it will be fascinating to see how the next months and years play out.
We’re also seeing BTC continue to be taken off exchanges, with the amount of BTC on exchanges continuing a downward trend that has been ongoing for several years.
This comes as demand for coins has ramped up, and with new issuance to be cut in two at the halving next month, raising the very real possibility of an incoming supply shock.
As for who is buying and who is selling, it appears that short-term holders have been taking profits while BTC was touching previous all-time highs, sending around $4.3 billion of in-profit BTC to exchanges.
And at the same time, smaller wallets–those holding 0 to 10 BTC–were picking up coins at the end of last week. This latter point marks a change, as prior to that, smaller wallets had been sellers.
A coin that’s been a little overlooked up to now in this cycle is ADA. Multicycle veteran Cardano, which has been around since 2017, may have a reputation for building less quickly than its competitors, but nonetheless, TVL on the network has increased significantly this year, and has now reached around the $600 million mark, surpassing previous highs.
Meanwhile, one of the stories of the moment in crypto is the explosion of activity around memecoins, and while there are new tokens appearing all the time, across blockchains, we’re seeing some memes now getting set up as relative heavyweights (although these kinds of coins are, don’t forget, extremely volatile.)
Leading the way when it comes to gains, we can find PEPE climbing rapidly, and below that, FLOKI has also been performing strongly.
When it comes to NFTs, some focus has shifted from Ethereum onto the Bitcoin Ordinals space, while the excitement around memecoins has, perhaps, sucked in some of the capital that might otherwise have been thrown at JPEGs.
These factors are reflected in the prices of large-cap PFPs on Ethereum, which have dropped recently after a boost starting in Q3 2023. With the exception, possibly, of memecoins, no other area of crypto is as fickle and attention-driven as NFTs, so a reversal in this trend is entirely possible, although there’s also the potential for some collections to drop off the radar entirely.
And finally, if we take a look at centralized exchanges, it’s apparent that Coinbase is becoming increasingly dominant in the US. In fact, over the past three months, Coinbase–which also acts as a custodian for eight of the new spot BTC ETFs–has ramped up its US market share from 47% to around 60%, and shows no signs of slowing down.
What’s more, this comes as the Coinbase share price has surpassed the $250 mark, showing particularly sharp gains since around when the ETFs launched in January.
Here are my key takeaways from the trends this week and with Bitcoin making new ATHs, the AI tokens and memecoins have skyrocketed!
- DexCheck is an AI-enhanced blockchain analytics tool that’s launched a series of DCK token burns happening every Sunday for the next 8 weeks. DCK has also been listed on three new exchanges.
- VoluMint is an AI automated market maker (AMM) that’s integrated with OKX wallet and BitMart. VoluMint has also announced a series of partnerships with Hybrid and Donorship, as well as enrolling into Google and Microsoft’s Developer Program.
- Gala is a play-to-earn (P2E) gaming and music ecosystem that’s partnered with AWS GameTech for its upcoming hackathon. The Gala team has been at The World Web3 Conference. A song featuring DMX has also been released on Gala Music.
- Opulous is a real-world assets (RWA) platform for music that’s announced new utility is in the works for its OPUL token on Arbitrum.
- DeepFakeAI is a deepfake platform that’s teasing its new DIY characters feature that is coming later in the year.
- Chihuahua Chain is a memecoin on Cosmos that’s teasing an upcoming partnership on X with another Cosmos chain.
- Grape is a gaming and metaverse blockchain that’s teasing an upcoming launch on X involving Uniswap.
- PaLM AI is an AI chatbot using Google AI tech that’s been featured in YouTube videos from crypto content creators including Alex Becker, AltcoinDaily and Crypto Banter.
- OpSec is an AI-powered cloud security project that’s announced its next major infrastructure upgrade, which includes 2 more nodes and 2x more servers. OpSec has also reached 20,000 holders and announced a hackathon at the ETHTaipei event.
- Fetch.ai is a blockchain-based AI platform that’s announced Peaq Network has joined its ecosystem. Fetch.ai has also secured $100M in infrastructure investment and announced GPU rewards for token holders.
- Solana is a Layer-1 blockchain that’s launched its Renaissance Hackathon and confirmed 5 airdrops for April from Kamino Finance, IONET, Zelta Markets, Drift, and Parcl. Pantera Capital is also raising $250M to buy discounted SOL tokens from FTX.
- Pixels is a Web3 farming and adventure game that’s reached a new ATH of 82,000 daily active users. Pixels has also launched Guilds in the biggest update to the game so far.
- Jupiter is a Solana DEX aggregator that’s launched its active staking rewards which has seen 125,000 wallets already stake over 180M JUP tokens.
- Render is an image and video rendering protocol that’s teasing the upcoming Nvidia conference on March 18.
- Dogwifhat is a Solana-based memecoin and NFT collection that’s seen its token skyrocket 48% in 24 hours. WIF has also overtaken BONK as the network’s biggest memecoin by market cap.
Thank you so much for your support, and I truly hope that today’s issue will give you insights needed to help you master your wealth.
If you are reading this it means you are on the free version of the Wealth Mastery Investor Report, which is great for news and tips on the crypto markets.
If you really want to take advantage of fastest growing asset class EVER, I highly recommend that you check out my Altcoin course: Mastering Altcoin Investing
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Lark and the Wealth Mastery Team
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