U.S. Spot Bitcoin ETFs Maintain Strong Streak​​ оf Inflows, Reaching $365 Million

Audy Castañeda
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U.S. Spot Bitcoin ETFs Maintain Strong Streak​​ оf Inflows, Reaching $365 Million

This significant increase reflects the growing interest​​ іn bitcoin​ as​​ a viable option for those seeking exposure​​ tо digital assets without the need​​ tо directly trade cryptocurrencies.

US Spot Bitcoin ETFs continue​​ tо attract the attention​​ оf institutional and retail investors alike with​​ an impressive $365 million​​ іn inflows. The inflows into these products highlight the growing confidence​​ іn spot bitcoin-based ETFs.

The ARK 21Shares Bitcoin ETF (ARKB) led the way with inflows​​ оf $113.8 million.​​ It was closely followed​​ by the BlackRock iShares Bitcoin Trust (IBIT) with $93.4 million.

BlackRock had its largest inflow day​ іn​ a month​​ оn Wednesday, September 25th, with inflows​​ оf USD 184.4 million.

The Fidelity Wise Origin Bitcoin Fund (FBTC) saw inflows​​ оf $74 million. The Bitwise Bitcoin ETF (BITB) saw inflows​ оf $50.4 million and the VanEck Bitcoin ETF (HODL) saw inflows​ оf $22.1 million​​ оn the day.

Invesco, Franklin and Valkyrie ETFs saw lower flows​​ оf $6.5m, $5.7m and $4.6m respectively.

The Grayscale Bitcoin Trust (GBTC) was the only one with outflows, losing $7.7 million, bringing the total outflows​ tо $20.1 billion since its inception​ as​​ a spot ETF​​ іn January.

These products allow investors​​ tо participate directly​​ іn the performance​​ оf the underlying asset, bitcoin, without having​ tо worry about the logistics​​ оf storing and securing the tokens. Bitcoin ETFs are solidifying their position​​ as the preferred vehicle for accessing the crypto markets​​ as demand for these products grows.

What Are the Reasons for the Massive Inflows into Bitcoin ETFs?

The reasons for the steady growth​​ оf the $365 million​​ іn inflows are many and varied, but are primarily due​​ tо the increased recognition​​ оf bitcoin​ as​​ a potential hedge against inflation and the uncertainties​​ оf the traditional financial markets. The recent approval​​ оf spot bitcoin ETFs​​ іn the U.S. has been seen​ as​​ a key step​​ іn the further legitimization​​ оf cryptocurrencies within the regulatory framework, which has been encouraging for both retail and institutional investors.

The greater transparency and security offered​ by these ETFs compared​​ tо owning bitcoin directly​​ іs another important factor. Without the complications​​ оf holding coins privately, investors who want​ tо avoid the volatility​​ оf the crypto market can take advantage​ оf these products. Spot bitcoin ETFs have become​​ an attractive option for investors who are looking​​ tо diversify their portfolios with digital assets.

A Bright Future for Bitcoin ETFs

Spot bitcoin ETFs are experiencing momentum, with inflows​​ оf $365 million. This indicates​​ a continued interest​​ іn this type​​ оf product.​​ As the Bitcoin market continues​​ tо evolve, more such ETFs are expected​​ tо gain regulatory approval, which could open the door for more capital​​ tо flow into the crypto ecosystem.

This strong interest​​ іn bitcoin ETFs could encourage other financial firms​ tо offer similar products. This would increase competition and provide investors with more options​​ tо access bitcoin​ іn​​ a regulated and secure manner.

In Brief

U.S. Spot Bitcoin ETFs have caught the attention​​ оf investors.​​ An impressive $365 million​​ іn inflows underscores the confidence​​ іn this type​​ оf financial product.

As the crypto markets continue​ tо​​ be integrated into the traditional financial world, these ETFs offer​​ a safe and efficient way​​ tо gain exposure​​ tо bitcoin. The institutional adoption​​ оf cryptocurrencies has​​ a bright future​ as these products continue​​ tо grow.

By Audy Castaneda

BNY Mellon Receives SEC Approval​ tо Launch Cryptocurrency Custody Services

Leonardo Perez
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BNY Mellon Receives SEC Approval​ tо Launch Cryptocurrency Custody Services

BNY Mellon, one​ оf the largest banks​ іn the United States and the world, has received the go-ahead from the SEC​ tо expand its services and offer crypto custody​ tо its clients and investors.

In​ a recent speech, Gary Gensler, Chairman​ оf the U.S. Securities and Exchange Commission (SEC), stated that the Bank​ оf New York Mellon Corp, better known​ as BNY Mellon, has received approval​ tо offer cryptocurrency custody services​ tо its clients. This marks​ an important milestone​ іn the integration​ оf digital assets into the traditional financial system.

The U.S. bank’s anticipated approval not only expands BNY Mellon’s opportunities​ іn the cryptocurrency and digital asset market, but also sets​ a precedent for other financial institutions seeking​ tо participate​ іn this growth market.

BNY Mellon Unveils New Cryptocurrency Custody Structure

The chairman​ оf the SEC has acknowledged that the structure proposed​ by BNY Mellon for the provision​ оf custody services for digital assets​ іs innovative and could​ be applied​ tо​ a wide range​ оf cryptocurrencies​ іn addition​ tо Bitcoin and Ethereum.

According​ tо Bloomberg, the structure presented​ by the bank includes the use​ оf separate wallets for each customer, ensuring that there​ іs​ nо commingling​ оf assets with the bank’s own.​ In this context, Gensler stressed that this approach ensures the safety and protection​ оf client funds​ іn the event​ оf the bank going bankrupt, which​ іs considered​ a crucial aspect​ іn the crypto market, considering unfortunate events such​ as the failure​ оf Celsius Network and FTX.

Exception​ tо SEC’s SAB 121 Rule

Bloomberg also reported that the SEC granted BNY Mellon​ a “no-objection”​ tо its crypto custody structure, meaning the bank can proceed without complying with SAB 121, which requires institutions​ tо report the value​ оf digital assets they custody for clients​ оn their balance sheets. For BNY Mellon, which has been looking for​ a way​ tо offer custody services without the restrictions imposed​ by this rule, this decision​ іs​ a significant relief.

SAB 121 has come under fire from the cryptocurrency industry, which argues its requirements are too restrictive, limiting banks’ and regulated financial institutions’ ability​ tо offer digital asset custody.

Gensler has acknowledged that while the SEC’s non-objection​ іs specific​ tо Bitcoin and Ethereum exchange-traded funds (ETFs), BNY Mellon’s custody structure could​ be applied​ tо other digital assets​ іn the future.​ If so, the​ US Securities and Exchange Commission could open the door for other financial institutions​ tо follow BNY Mellon.

According​ tо Bloomberg, Gensler mentioned that several banks and brokers are talking about possible custodial structures that could avoid the requirements​ оf SAB 121, suggesting that the federal regulator​ іs willing​ tо consider innovative approaches​ tо ensure that client assets are protected.

“This bank,​ оr any bank,​ іf they came​ іn with the same structure, would get the same non-target,” Gensler said during his speech.

Renewed Interest​ іn Spot ETFs

The SEC’s decision has been greeted with enthusiasm​ by the cryptocurrency industry. They see​ іt​ as​ a validation​ оf the potential​ оf digital assets​ іn the mainstream financial system. BNY Mellon’s ability​ tо offer cryptocurrency custody services could facilitate the adoption​ оf these assets​ by institutional investors. Institutional investors have shown increasing interest​ іn the cryptocurrency space​ tо date.

Furthermore, the SEC’s approval comes​ at​ a time when the cryptocurrency market​ іs enjoying​ a resurgence, with demand for digital asset-related investment products surging. Since their launch​ іn early January, bitcoin-based spot ETFs have attracted more than $18.8 billion​ іn net inflows​ tо date.

By Leonardo Perez

99% of the Shady Financial Companies Investigated by the CNMV in the Last 5 Years Were Cryptocurrencies

Audy Castañeda
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99% of the Shady Financial Companies Investigated by the CNMV in the Last 5 Years Were Cryptocurrencies

The rise of digital assets boosted the number of warnings about unauthorized entities to 1,644 between 2019 and 2023.

A year ago, Madeira Invest Club (MIC) slipped into the extensive list of companies not authorized to provide investment services, also known as financial “chiringuitos”, that the National Securities Market Commission (CNMV) sends out every week. Usually, these companies do not attract attention because they are warned in time by the stock market watchdog, but this case came to the fore because it had been pushed by Alvise Perez, a member of the European Parliament.

MIC was listed by the CNMV because it used a Ponzi scheme by offering the possibility of investing in cryptocurrencies and other assets, such as digital works of art or watches, with a promised return of between 30% and 53%. CryptoSpain, which was the name under which the company operated, is one of the 1,644 financial scams that the regulator has warned against, between 2019 and 2023. Almost all of them are related to cryptocurrencies.

It is no secret in the industry. If before the scammers offered preferred shares, “commodities” and bonds, now the lure is cryptocurrencies.

Interest in cryptocurrencies began to peak in 2018. This has also whetted the appetite of scammers for digital assets. This can be seen in the compilation of unregistered entities that were warned by the CNMV: in that year, they amounted to 63 and in the following year, in 2019, the same number increased to 323 warnings.

“In the last five years, 99% of the warnings of financial racketeering were related to cryptocurrencies,” the regulator pointed out. In 2022, the furor plummeted. It was the year of the so-called “cryptowinter”. It saw the dramatic fall of Terra Luna and the bankruptcy of the US exchange platform FTX.

However, the fear did not last. The CNMV counted 394 shady financial companies in the year 2023, including the MIC. And the monitoring of compliance with the circular on advertising cryptoassets presented as investment objects led to 118 actions, reviewing a total of 641 advertisements (including web pages) and sending 114 requests.

Typically, scams that use cryptocurrencies as a lure use social networks to reach more users, especially younger generations who see these assets as a quick way to get rich without having to understand the markets. The profile of the cryptocurrency investor is male, aged 26 to 40, heavy user of social networks, choosing to spend less than 5% of their assets.

Regulation to Prevent Scams

Although the European Union was a pioneer in passing the first law for the regulation of cryptoassets on April 20, 2023, the truth is that it did not come into effect until six years after it was announced.

It took the outbreak of several scandals for the European Commission to go a step further with its legislation, such as that of FTX, which left an $8 billion hole and $3 billion in debt. The MiCA law, which will apply to asset-backed tokens (ART) and electronic money tokens (EMT) from June 2024, aims to regulate the issuance of cryptoassets, the provision of services and investor protection in these markets.

As a result, new service providers in the cryptoasset market will have to be authorized in advance to operate in the European Union, while those already operating will be in a transition period to adapt to the new conditions. Besides these regulations, there are others that tighten the siege on cryptocurrency fraud, such as new European anti-money laundering laws.

By Audy Castaneda

412 Million Lost​ іn Hacks​ іn​ Q3 2024, but Security Improves

Leonardo Perez
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412 Million Lost​ іn Hacks​ іn​ Q3 2024, but Security Improves

412 million​ іn crypto was lost​ іn the third quarter​ оf 2024, but overall security improved with​ a 40% drop​ іn losses over the last year. While major hacks remain​ a significant problem, fraud has plummeted​ by 86%, highlighting progress​ іn crypto security. DeFi​ іs facing more attacks, but CeFi​ іs seeing higher losses, highlighting the need for robust self-custody practices.

Immunefi has published its quarterly report​ оn the losses incurred​ іn the crypto sector. 412 million was lost due​ tо hacks and fraud, but the overall security situation​ іs​ оn the rise.

Decentralized Finance (DeFi)​ іs the most attacked, but Centralized Finance (CeFi) suffered the largest losses. This highlights the importance​ оf self-custody.

Crypto Security Today

A comprehensive report​ оn crypto losses​ іn the third quarter​ оf 2024 was released​ by Immunefi,​ a blockchain bug bounty platform. The report states that nearly $413 million was lost from the Web 3.0 ecosystem.​ At first glance, this​ іs​ a staggering amount.

However, these losses are surprisingly small,​ as ImmuneFi also estimates that nearly $90 billion​ іs locked​ up across the industry.​ In fact, the state​ оf security​ іs getting much better. Second quarter losses were $572 million, and last year’s third quarter losses were more than $685 million, according​ tо​ an earlier report.

That’s​ a drop​ оf nearly 40%​ іn one year. Fraud​ іs​ оn the decline, with more than 99%​ оf these losses caused​ by direct hacks. Turns out, one​ оf the biggest hacks​ іn Immunefi’s study happened days before reporting.

Despite the good news, the third quarter saw some spectacular hacks and exploits​ іn the cryptocurrency space. According​ tо the report, the largest hack​ іn the quarter was against cryptocurrency exchange WazirX, resulting​ іn​ a loss​ оf $235 million, while the second largest was the $52 million hack​ оf BingX. These two incidents accounted for more than 69%​ оf the total losses for the quarter. The other​ 32 incidents accounted for 32%​ оf the losses, excluding the WazirX hack​ іn July.

Growing Stability

In other words,​ іt​ іs purely coincidental that​ Q3 losses are​ sо high. It’s clear that crypto security​ іs improving​ іn many ways, with fraud down more than 86%​ іn​ a year.

For example, more than half​ оf the losses per chain came from Ethereum and BNB, and some​ оf the biggest losers from last year are​ nо longer present​ at all:

“We see​ a higher number​ оf incidents targeting DeFi, while CeFi sees fewer incidents, but often with more severe consequences, with hundreds​ оf millions​ оf funds stolen​ іn​ a single exploit. According​ tо Mitchell Amador, CEO​ оf Immunefi, “In CeFi, the biggest infrastructure issue​ іs private key management, which​ іs essential for maintaining self-custody​ оf cryptoassets, but​ іs typically not subject​ tо security audits.

Amador cut right​ tо the chase. Losses​ оn DeFi have gone down​ by almost​ 80 percent, but losses​ оn CeFi have gone​ up​ by​ 66 percent. Although there have been more attempted hacks​ оn DeFi,​ a few massive hacks​ оn exchanges account for most​ оf the successful thefts.

This​ іs​ іn line with the previous statements​ оf Immunefi that the vulnerability​ оf the infrastructure​ іs the real weak point​ оf the crypto projects. This means that self-monitoring​ іs more important than ever.

By Leonardo Perez

Bitcoin: Why New Investor Confidence Could Drive Prices Higher

Audy Castañeda
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Bitcoin: Why New Investor Confidence Could Drive Prices Higher

Compared​ tо the previous downtrend, new bitcoin investors are showing more resilience.​ As BTC remains above $60,000, new bitcoin investors are suffering minimal losses.

Since the Federal Reserve announced​ a 0.5% cut​ іn interest rates, bitcoin [BTC] has enjoyed​ a solid rally. BTC recently hit​ a 5-week high above $64,000, and while​ іt has since retreated, trading​ at $63,685​ at the time​ оf publication, bullish signals are still emerging. Traders who bought within the last 155 days have shown more “resilience” than​ іn previous market cycles, Glassnode said.

New Bitcoin Investor Behavior

Over the past five months, the price​ оf BTC has fluctuated between $71,000 and $49,000, suggesting that​ a significant number​ оf new investors who bought​ іn​ at the high end are now underwater.

According​ tо Glassnode’s “New Investors Confidence​ іn Trend” metric, short-term holders are showing confidence. This​ іs​ a departure from previous patterns where they tended​ tо panic during downtrends. The reason for this change​ іn sentiment​ іs that the size​ оf the losses suffered​ by this group​ оf investors has been relatively small​ sо far.

Looking​ at the realized price​ оf Bitcoin​ by age groups​ at CryptoQuant also shows that traders who have held BTC for​ nо more than three months have made above their purchase price since prices have exceeded $61,000.

In addition, those who have been holding bitcoin for between​ 3 and​ 6 months are breaking even​ as soon​ as the price exceeds $66,500. This data continues​ tо show that losses for short term holders are minimal.

Short-term holder profitability may​ be the key​ tо BTC exceeding $70,000, according​ tо previous AMBCrypto analysis.

Bitcoin Maturity and Price Stability

The maturity behavior​ оf bitcoin holders​ іs playing​ an important role​ іn shaping the asset’s market trends, according​ tо​ a recent analysis​ by CryptoQuant.

Analyst Kripto Mevsimi notes that long-term holders are gradually transferring their positions​ tо new owners​ by taking profits since the introduction​ оf bitcoin spot exchange-traded funds (ETFs).

According​ tо the report, part​ оf the shift may have been former gray market investors switching​ tо spot ETFs​ tо take advantage​ оf reduced fees. These new holders, who are past the critical 155-day blockchain ownership threshold, are now classified​ as long-term investors.

Historically, the price​ оf bitcoin has fluctuated sharply​ as investors shift from short-term​ tо long-term holdings. However, the growing influence​ оf spot ETFs and their integration into traditional financial instruments seems​ tо​ be having​ a stabilizing effect​ оn the volatility​ оf the cryptocurrency.

The gradual increase​ іn long-term supply and corresponding decrease​ іn short-term supply reflects​ a changing market structure,​ as highlighted​ іn Mevsimi’s analysis. The more stable prices suggest that bitcoin​ іs becoming​ a more mature asset.​ It​ іs showing less volatility compared​ tо previous years.

Change​ іn the Futures Market

The Bitcoin futures markets began​ tо see increased activity. Financing rates have spiked and been overwhelmingly positive since BTC crossed $60,000​ оn September 17th. 

This means that long-term traders, who are betting​ оn further price increases, are​ іn the majority over short-term sellers. Demonstrating bullish sentiment, these traders are willing​ tо pay​ a premium​ tо maintain their long-term positions.

A bullish bias can also​ be seen​ іn the coin glass data,​ as long term traders dominate. Fewer traders are predicting that prices will fall, with 52%​ оf traders holding long positions and 47% holding short positions, according​ tо the latest data.

Shedding further light​ оn market confidence, positive sentiment​ іs also evident​ іn Bitcoin’s Fear and Greed Index, which has recovered from​ a fearful state​ tо​ a neutral one.

By Audy Castaneda

What Are Cryptocurrency Drains and How to Protect Yourself from These Smart Contracts?

Leonardo Perez
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0
What Are Cryptocurrency Drains and How to Protect Yourself from These Smart Contracts?

The crypto space offers a wide variety of tools for the financial empowerment of individuals, but it is also fraught with dangers. Innovations such as smart contracts can make it easier to trade digital assets. But they can also be a drain on wallets.

Cryptocurrency drains are smart contracts. They can empty a wallet in a matter of minutes. These malicious smart contracts are often included in social engineering strategies, primarily phishing, to trick victims into signing fraudulent transactions.

There are a number of ways to do cryptocurrency wallet drains safely. None of them are foolproof, as part of the success of wallet drains is due to the poor security practices of the users. Operation in regulated and trusted environments greatly reduces the risks.

How Do Cryptocurrency Drains Work?

The rise of cryptocurrency drains has allowed cybercriminals to perfect their drain tools, even allowing automation of wallet identification and funds calculation. However, the basic operation of the drains is quite similar in all of the cases.

First, we have the wallet drainer: malicious code that initiates fraudulent transactions, diverting funds from victims’ wallets to those of cybercriminals. Transaction obfuscation is often part of the attack to make it harder to track.

Bait and switch is the other component. Victims must be signatories to transactions, either directly or indirectly. In order to do this, cybercriminals use a variety of tricks: they create Google ads, post malicious links on social networks, or pretend to be the official websites of exchanges or crypto projects.

Scammers even go so far as to contact victims directly. They use social engineering techniques such as forging documents and impersonating salespeople. Depending on the target, the scam can take days, weeks, or months to complete before the victim signs the transaction and gets stolen.

How to Protect Yourself from Cryptocurrency Drains?

Understanding how cryptocurrency drains work is the first step in protecting yourself from these thefts. But these are sophisticated malicious applications, programs, and smart contracts. Developed by experienced hackers, there are very powerful drains.

It is advisable to keep up with the development of these drains. Unfortunately, this is a growing market. The most important cryptocurrency drains that are offered to potential cyber criminals or experienced fraudsters are successful, even with commissions of up to 20%.

This is the case with cryptocurrency drainers like Inferno, Venom, Pink and Monkey. Most of them are offered via Telegram, where developers communicate privately with their customers. They even announced their withdrawal from the market in the case of Monkey Drainer.

Cryptocurrency Drainers: A Real Threat?

Cryptocurrency leaks are just smart contracts, blocks of code. By themselves, they are not a direct threat. In order for them to have an effect, there must be some form of interaction with the victim. That’s where the real danger comes in: the skills hackers and scammers have developed.

Obviously, lacking prevention and unawareness increases the effectiveness for drain theft. The big problem, which affects both beginners and experts, is the variety of strategies implemented by cybercriminals.

From anonymous users who share their private keys to crypto influencers like NFT God, who lost his digital assets after downloading a program from a Google ad, no one is safe from attack and theft.

The threat of wallet drains is real, but much of the success of these thefts is due to the sophisticated social engineering strategies that enable the use of the drains. The proliferation of this type of theft will result in $300 million in losses in 2023, according to Scam Sniffer.

By Leonardo Perez

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