ARP's Crypto Digest

General Digital Asset Market View:

On December 19, the 11 Bitcoin ETFs in the U.S. experienced their worst trading day ever, with outflows surpassing $671.9 million, breaking the previous record of $564 million set on May 1. This large outflow is considered a direct response from Wall Street investors following the recent comments from the Federal Reserve Chairman, signaling that there will be no continuous interest rate cuts in 2025 as previously expected. This is due to inflation in the U.S. not cooling as the Fed had hoped.

Among the largest outflows, the BlackRock Bitcoin ETF saw a withdrawal of $72.7 million, adding to Fidelity’s $208.5 million outflow. These massive outflows led to a halt in the 16-day streak of inflows into spot Bitcoin ETFs.

The price of Bitcoin was directly impacted, dropping by more than 3% from its all-time high of over $108,000 to as low as $93,000, before rebounding slightly to $98,000 at the time of writing. The combination of significant ETF outflows and macroeconomic factors contributed to this volatility in Bitcoin’s price.

Macro:

The key US focuses this week are durable and cap goods alongside new home sales, December’s conference board survey and the latest run of claims data (though this could be delayed if the shutdown kicks in). It’s a quiet week in Europe and the UK, while Asia will see a decent chunk of high frequency activity data (in particular, Korean 20-day trade and in Japan where we will get the services PPI, final machine tool orders reading, Tokyo CPI, retail sales and IP). From a monetary policy POV, the key event is Ueda’s speech on Christmas day. The latest set of meeting minutes from the RBA and BoJ will also be released on Tuesday. Here is a link to the UST auction schedule for the remainder of the year; it’s a pretty light schedule.

More Crypto:

In 2024, euro monthly volumes more than doubled year-to-date, outpacing KRW, JPY, and CAD but growing more slowly than BRL, USD, and TRY. Despite trailing other fiat currencies in total volume, the euro’s prominence in the Bitcoin market increased significantly. BTCEUR’s share of global BTC-fiat trade volume surged in 2024, rising from 3.6% to nearly 10%.

Bitcoin’s market cap has reached a new all-time high against gold’s market cap, now at 14%.

This milestone comes as total assets under management (AUM) for bitcoin exchange-traded funds (ETFs) have climbed to $129 billion, surpassing gold ETFs, which hold $128 billion. Gold, with a 20-year head start, has been flipped by bitcoin.

Bitcoin ETFs have reshaped institutional interest in crypto, achieving near parity with gold ETFs in under a year since spot bitcoin ETFs launched in January.

Stablecoins Metrics and News:

Metrics:

In 2024, stablecoin adoption is booming in emerging markets like Sub-Saharan Africa, Latin America, and Eastern Europe, where limited banking and growing mobile use drive demand. Stablecoins like USDT on Tron are key for remittances, peer-to-peer transactions, and small businesses. Companies like Yellow Card and Bitso enable this shift with localized services. As stablecoins replace traditional banking, crypto exchanges, payment platforms, and fintech are converging into next-gen super-apps.

Stablecoins had a breakout year in 2024, evolving from simple exchange collateral to one of crypto’s most impactful products, widely used by millions worldwide. By mid-2024, monthly transfer volumes across all chains surpassed $3.5 trillion — matching Visa’s total transaction volume for Q3. This growth highlights multiple trends: the dominance of the dollar, advancements in financial infrastructure, and increasing adoption in emerging markets.

News:

• Ethena Rolls Out Stablecoin Backed by BlackRock’s BUIDL Token.

• FTX will allow bankruptcy payments with stablecoins via BitGo and Kraken exchanges.

• Tether invests in StablR to promote stablecoin adoption in Europe.

• Rumble announces $775M strategic investment from Tether

• Stablecoins Hit Record $190B Market Cap, Surpassing Pre-Terra Crash Peak.

What Happened This Week:

• Aptos co-founder and CEO Mo Shaikh announced his resignation and appointed Avery Ching as the new CEO.

• The Avalanche Foundation has announced the infraBUIDL(AI) program, an initiative designed to accelerate AI development within the Avalanche ecosystem.

• We’re not allowed to own bitcoin,’ Fed Chair Powell says in light of Trump’s strategic bitcoin reserve promise.

• Sonic Labs announced the launch of Sonic Mainnet, a high-throughput EVM-compatible L1 blockchain platform.

• Arkham has announced an official partnership with the Sui network to provide data for Sui users.

What to Look Out For:

• Mt.Gox has transferred approximately 720 BTC (~$69.7M) to a new unknown address.

• World Liberty Financial has announced a collaboration with Ethena Labs to integrate sUSDe into the WLFI lending platform.

• Grayscale has introduced new crypto funds for $ZEN, accessible to accredited investors.

• Stacks to open Bitcoin Deposits for sBTC Rollout & Incentive Program.

What we enjoyed reading and listening to:

• Stablecoins will eat payments — Link

• Stablecoins aren’t cheaper, They are better — Link

• Blockchains vs. Bureaucracy: The Costs Of Curtailing Innovation — Link

• Talking trends 2025 (part 2): AI x crypto — Link

• Economic incentive design for stablecoins — Link

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