GM friends,
Bitcoiners have this year HODLed through German government BTC selling and Mt Gox coin distribution, but what’s happening now with the US government’s crypto holdings?
Let’s start the week with a look at the US authorities and their stash of seized Silk Road bitcoin, as we try to figure out whether or not they’re selling.
Here’s what’s in today’s issue:
- Sam shares his thoughts on the US government selling Silk Road BTC, Trump’s pro-crypto transition team, Franklin Templeton’s crypto index ETF filing, a new meme coin chain & Optimism’s plan to hard fork.
- Crypto Portfolio update for week 27.
- This week on chain.
- This week’s trending coins by Rebecca.
Get a FREE $500 Bitcoin trading position on Bybit! Just use this link and click register to claim
Is the US Government Selling Silk Road Bitcoin?
There’s no doubt that the US government is in possession of a large stack of BTC (around 50,000 coins) that it seized in relation to the now-defunct Silk Road online black market.
In fact, presidential candidate Donald Trump recently remarked that his policy–if elected–would be to HODL any seized sats, but is the US now in the process of offloading these coins?
The answer to that depends on who you ask, but according to finance lawyer Scott Johnson, the US Marshals Service (USMS) “is almost certainly selling Silk Road bitcoin”.
The USMS is a federal agency within the Department of Justice whose duties include dealing with criminal assets, and on August 15th it sent around 10,000 BTC that originally came from Silk Road to a Coinbase Prime deposit address, having last month moved almost 30,000 Silk Road BTC to an unknown address.
Regarding the most recent transfer, Johnson posted that the move is in line with the terms of a servicing agreement agreed in June between the USMS and Coinbase, but that as this agreement requires asset segregation, “you can be sure USMS has already sold or is selling imminently”.
However, there’s no official confirmation of this (and it’s possible that clarification won’t be available until the Department of Justice publishes an asset forfeiture report next January), and not everyone is in agreement about what’s happening.
As Bitget Research chief analyst Ryan Lee was recently quoted as saying the transfer “does not mean that 10,000 Bitcoin have already been sold”, pointing out that the USMS agreement with Coinbase was “to ‘safeguard and trade’ large digital assets”.
But what do you think, would US government selling affect the market much, and if so, is this an opportunity to accumulate? Reply to this email and let us know how you’re approaching bitcoin right now.
Trump’s Pro-Crypto Transition Team
With the US presidential election edging nearer, the Trump campaign has announced its transition team, which would be responsible for preparing for office in the event of an election win. And with personnel now confirmed, we can see that it’s a very crypto-friendly unit made up of the following members:
- Howard Lutnick. The Cantor Fitzgerald CEO will co-chair the team. He manages Tether’s treasury portfolio, and has previously made Bitcoin maxi-style statements in favor of BTC over the rest of crypto.
- Linda McMahon. The Chair of conservative think tank AFPI will also co-chair the team. AFPI has published reports highly critical of CBDCs while also acknowledging that “innovations around blockchain, digital assets, and the technologies behind CBDCs are undoubtedly the way of the future”.
- JD Vance. Trump’s running mate is an honorary Chair of the team. Vance has disclosed personal BTC holdings, and has floated draft legislation to move the SEC and CFTC in a more pro-crypto direction.
- Donald Trump Jr. and Eric Trump. Also honorary Chairs, Trump’s sons are themselves working on a crypto project, with Eric Trump talking in an interview about “digital real estate” (which sounds like an RWA plan), and Donald Trump Jr. posting on X that “decentralized finance is the future”.
Candidates Neck and Neck on Polymarket
As for how the presidential contenders are doing in the prediction markets, Polymarket now has Kamala Harris and Donald Trump neck and neck on 49% each.
This comes after Harris had last week moved ahead of Trump, before which Trump had enjoyed a huge lead over former Democrat candidate Joe Biden.
Trump’s move to catch back up with Harris appears–at least partly–to be a result of some of Harris’ recently revealed economic plans–price controls being the contentious part–which received negative reactions even in Democrat-supporting media such as CNN and The Washington Post.
Franklin Templeton Crypto Index ETF Filing
Crypto ETFs have been the story of 2024, and it looks like there may be more still to come on this front, as Franklin Templeton–which has dived enthusiastically into both spot BTC and spot ETH ETFs–has now filed for a mixed crypto ETF that will initially combine BTC and ETH.
Using the ticker EZPZ, the proposed Franklin Templeton Crypto Index ETF will track the CF Institutional Digital Asset Index, which currently holds just BTC and ETH, but has the potential to expand into other crypto assets in future, depending on how the regulatory landscape pans out.
If approved, Franklin Templeton’s diversified product will use Coinbase Custody Trust Company as its custodian, and will be listed on the Cboe BZX Exchange.
Is Tron the New Meme Coin Chain?
Solana has been the meme coin capital throughout 2024 so far, but Justin Sun’s Tron is now making moves to take over with the launch last week of the Sun Pump platform, which allows for quick and easy meme coin launches.
Data shows that since going into action on August 13th, Sun Pump has seen over 2.8 million TRX (over $380,000) in revenue from token launches, while last Saturday was the best single day performance, with revenue of over 1 million TRX.
And by the way, if you’ve been in the meme coin trenches for a while, you’ll notice that Sun Pump is very similar to the Pump.fun platform on Solana, but as a reminder of how brutal meme coin trading can be, here’s a stat to put things in perspective: if you made a Pump.fun profit of over $1,000, that would actually put you in the top 3.061% of users.
Optimism Plans Hard Fork After Vulnerabilities Found
Ethereum Layer-2 Optimism has been having some security issues lately after a series of community-driven audits discovered several vulnerabilities–including two categorized as high severity–within the OP Stack network.
According to a (very technical) post from an OP Labs engineer, none of the faults have been exploited and user assets have at no point been at risk, and a fix is now in process.
This means that Optimism has reverted back to using permissioned fraud proofs, after having switched to permissionless fraud proofs–a system that improves the network’s level of decentralization–two months ago.
Additionally, as part of a proposed network upgrade called Granite, there are plans for a hard fork that–if approved by vote–will go ahead on September 10th.
Week 27 Crypto Portfolio Update
Just holding and chilling
See the 10x Portfolio breakdown and weekly history since inception HERE!
Starting with bitcoin, it looks like at this quiet stage in the cycle the market is in accumulation mode, and in fact has been for the last month, with Glassnode noting that bitcoin’s Accumulation Trend Score has hit 1.0, which is the highest possible level for this metric.
And we can also see that long-term holders have been buying, as the level of their changes in position reaches a point previously seen back in May of 2023, when BTC was trading below 30K.
When it comes to the spot bitcoin ETFs, the leading product is BlackRock’s IBIT, and looking back over its performance since launching in January, we can see that it has only had one single day of negative flows throughout this entire time (although there have been nine days with net neutral flows), while BlackRock has now accumulated almost 350,000 BTC.
And staying with bitcoin, it’s also apparent that supply on exchanges continues to decrease, and has recently been dropping sharply to approach 2.7 million coins; a situation that could create a very interesting dynamic if the market picks up and demand increases after the current summer lull.
It’s informative also to look at a comparison that’s been made between the sizes of the bitcoin market and of the gold market, especially as gold has been performing so well recently.
Here we can see that while the bitcoin market is only around a tenth the size of the gold market, BTC makes periodic large gains in value compared to gold, in line with the halving cycles, but this has not yet happened in the current cycle.
Switching our attention now over to the Real World Assets sector, which has huge potential when it comes to mainstream crypto adoption, we can already see that there has been a ton of growth, with the total value of tokenized RWAs expanding from just around $500 million about three years ago to around $11 billion now. Also note that these figures don’t include stablecoins.
When it comes to Layer-2s, Base looks like an enormously solid contender, and this is reflected in a recent sharp increase in developer activity, with a surge in contract deployers last week meaning the metric hit a new ATH approaching 35,000 in one day.
What’s more, looking at the USDC stablecoin on Base, we can see that while supply is around the $3 billion mark, holders have climbed to over one million, monthly transfer volumes are around $80 billion, and also, the number of monthly USDC senders is at around 500,000.
Meanwhile over on Aptos, there has been a major spike in daily transactions, with the number leaping up to over 326 million, while the previous ATH for this metric was only around 156 million.
The reason for this sudden surge is user activity within a ‘jump-to-earn’ game called Tapos, which has been racking up transactions.
And finally, if you’re interested in Optimism Superchains–meaning specialized chains built using the OP Stack–then you might want to take a look at DeFi platform Frax Finance, which has built a rapidly growing chain that is now approaching $125 million in bridged assets over around the last five months.
Additionally, we can see that Web3 social network Zora has grown to over the $20 million mark, and there’s also Orderly Network–which is focused on perps trading–reaching over $500,000 in bridged assets, all of which indicates a healthily expanding network ecosystem.
Here are my key takeaways from the trends this week and there’s been a ton of exciting launches.
- Constellation is a feeless Web3 network that’s announced new network upgrades including a new tokenomics model called Metanomics.
- AIT Protocol is a Web3 data infrastructure platform that’s launched its new points system which has gained over 10,000 verified new users in the first 3 days.
- Pendle is a DeFi yield trading platform that’s transferred 600K PENDLE tokens from its Ecosystem Fund to Binance. Pendle has also launched its new pools on the Ethereum network.
- Sundog is a memecoin on Tron that’s seen its token jump 77% in 24 hours and its market cap briefly hit $100 million after Tron launched its memecoin launchpad to rival Pumpfun called SunPump.
- SuperRare is an NFT marketplace that’s announced its new series SuperRare Salon featuring Cory Van Lew’s ‘Sleep Demonz’ and will be launching on August 19.
- Ondo is a Real-World Assets (RWA) platform that’s been featured in Our Network’s latest report on RWA adoption and usage.
- Solana is a Layer-1 blockchain that’s seen its memecoin launchpad Pumpfun remove its $2 issuance charge pushing fees to all-time highs, leaving users unhappy. Solana has also launched its Japan event.
- Ethereum’s gas fees dropped to a 5-year low which could be due to a drop in users and apps moving to other networks. However, analysts are optimistic as history shows that low gas fees come before a significant increase in ETH.
- Bitcoin ETFs bought by institutions in Q2 is up 27% and the US Government has also moved $600 million in seized BTC from Silk Road to Coinbase. Apple’s NFC upgrade means Bitcoin and crypto payments are now possible.
- Aave is a lending protocol on Ethereum that’s been one of the top gainers of the week with a 9% jump in 24 hours. Voting has also opened to launch Aave V3 on zkSync.
- Toncoin is a Web3 ecosystem within Telegram messenger that’s been added to Binance’s Launchpool platform and Pyth has partnered with TON to deliver real-time DeFi data on the network.
- Bittensor is a decentralized machine-learning protocol that’s seen downside volatility in its token price despite recent positive developments like the launch of Grayscale’s Bittensor Trust. Traders are hoping for an imminent breakout.
- Pepe is a memecoin that’s opened its token presale for Pepe Unchained and has raised over $18 million in 10 days.
- Sui is a Layer-1 blockchain that’s launched its Sui Name Service and rewards from the Sui Bridge incentive program are available and ready to claim.
- 15. Polygon is an Ethereum sidechain that’s been teasing its upcoming token migration from MATIC to POL on September 4.
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.
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Lark and the Wealth Mastery Team
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