ARP's Crypto Digest

General Digital Asset Market View:

Between January 20–25, Bitcoin ETF flows experienced notable fluctuations, reflecting investor sentiment. BlackRock’s IBIT led with $39.729 million in year-to-date inflows, including a massive $661.9 million on January 21, signaling strong investor confidence. Fidelity’s FBTC also performed well with $13.039 million in inflows, highlighted by $186.1 million on January 24, showing renewed market interest.

Meanwhile, Grayscale faced mixed results: its GBTC fund saw outflows of $21.752 million, while its BTC fund had a modest $1.098 million inflow, suggesting a shift from GBTC to direct Bitcoin exposure. Despite some volatility, the overall trend for Bitcoin ETFs remains positive, with a peak inflow of $802.6 million on January 21 underscoring strong market confidence.

Macro:

A super busy — and multifaceted — week coming up. A lot of important data will be released Monday-Wednesday in the US to help firm up Q4 GDP nowcasts. Advanced estimates for US and Eurozone GDP are due on Thursday, while inflation reports in the US and Europe will also be in focus toward the tail end of the week. In Asia, the focus will be on economic activity in Japan and PMIs in China. From a monetary policy POV, the Fed, ECB and BoC will all be on the docket. Four of the Mag7 (Microsoft, Meta, Tesla, Apple) are due to report this week alongside two of Europe’s largest corporates — LVMH and SAP. The LNY holiday will be observed in Asia, with varying market closures, while India will deliver its Union Budget on Sunday.

More Crypto:

World Liberty Financial acquired over $100M in crypto tokens on inauguration day, buying $46.8M in ETH and $46.7M in WBTC among others. (WBTC/ETH)Holdings.

Bitcoin’s current cycle continues to echo historical trends, particularly aligning with the 2015–2018 cycle. BTC performance since the cycle low at the current stage of the cycle (no. of days since low):

2022 Cycle+: +630%

2015–2018 Cycle: +562%

While it’s not a perfect comparison, since ETF shares only represent a small amount of BTC, it does show the impressive growth of these funds. In just one year the top three ETFs by AUM regularly outperform major US exchanges in volume, but not the major global exchange. Binance, which has no US Dollar pairs, is not included above and regularly does 3x the volume of these three funds.

What Happened This Week:

• Justin sun announced the official launch of $USDD 2.0, an algorithmic stablecoin issued by the Tron DAO Reserve.

• Trump said in a Fox News interview that he knew about the $TRUMP launching, but didn’t know in detail what price it was currently trading at.

• Trump pardoned Silk Road operator Ross Ulbricht. This is one of Trump’s promised cryptocurrency initiatives, and the community welcomes it.

• MicroStrategy purchased an additional 11,000 BTC (~$1.1B) at an average price of $101,191 per $BTC.

• The Ethereum Foundation has announced that it has set up a multisig wallet to participate in DeFi and is transferring 50,000 ETH to it.

What to Look Out For:

• Trump promised at the Davos forum to make the U.S. the ‘world capital of AI and Cryptocurrency’.

• Trump called on the Fed to cut rates immediately. The upcoming FOMC is scheduled for January 29, which could affect the rate decision.

• Cow Dao proposed Revenue-Share, a structure where the Cow protocol collects the fees charged by partners and then splits them between the partner and the DAO in a percentage.

• Bitwise has submitted a registration filing in Delaware for a potential $DOGE exchange-traded fund.

What we enjoyed reading and listening to:

• Nobody Makes Money ‘Trading’ Crypto — Link

• What is consumer crypto? — Link

• A new (digital) age at the SEC — Link

• Why AI Won’t Cause Unemployment — Link

ARP Digital is regulated by the Central Bank of Bahrain as a Category 3 Crypto Asset Service Provider. All communications and services are directed at Professional Clients only, persons other than Professional Clients, such as Retail Clients, are NOT the intended recipients of our communications or services. ARP Digital does not provide investment advice, and nothing herein shall be considered, construed as, or deemed to be, investment advice. Furthermore, nothing herein is intended to be, or shall constitute, an offer or invitation to buy securities or any form of financial instrument or investment product by ARP Digital or any of its related parties or persons.