Gate.io Blog Daily news | The U.S. spot Bitcoin ETF has reduced its holdings by about 1,698 BTC yesterday; MicroStrategy added 122 BTC to its portfolio in April

Daily news | The U.S. spot Bitcoin ETF has reduced its holdings by about 1,698 BTC yesterday; MicroStrategy added 122 BTC to its portfolio in April

01 May 11:53

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##Crypto Daily Digest: For the first time, Bitcoin's market capitalization to transaction fee ratio has fallen below that of Ethereum. Meanwhile, the U.S. House of Representatives has called attention to contradictions in the U.S. SEC's statements regarding Ethereum's security status.The U.S. spot Bitcoin ETF has pared down its holdings, selling off approximately 1,698 BTC yesterday. In contrast, MicroStrategy has reinforced its commitment to Bitcoin with the purchase of 122 BTC in April.

Data from TheBlock indicates: for the first time since July 2019, the seven-day moving average of <a href="/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a>'s market capitalization to transaction fee ratio has dipped below <a href="/price/ethereum-eth" target="_blank" class="blog_inner_link">Ethereum</a>'s.

io.net has unveiled updates to its two-week launch plan, including the integration of a GPU workload verification mechanism and user experience enhancements. 
Additionally, Trias, a Layer-1 trusted network, is gearing up to launch a public testnet in May, set to be rigorously stress-tested with active involvement from the community.

The U.S. House Financial Services Committee has released a statement highlighting inconsistencies between the SEC's position on Ethereum's security status and remarks made by SEC Chairman Gary Gensler. The U.S. Banking Committee has expressed its intent to scrutinize the SEC for what it perceives as overregulation in the digital asset market, holding that SEC’s classification of Ethereum bears significant implications for the potential approval of the first U.S.-based spot Ethereum ETF.

Data from Lookonchain reveals recent movements in spot Bitcoin ETF holdings as of April 30: Grayscale decreased its Bitcoin reserves by 1,328 BTC, valued around US$807 million, resulting in a remaining balance of 297,118 BTC, worth an estimated US$18.06 billion. In total, nine spot Bitcoin ETFs, including Grayscale, have collectively reduced their holdings by 1,698 BTC, which translates to approximately US$1.0322 billion in value.

The Hong Kong Monetary Authority (HKMA) has announced that cryptoassets, with a particular focus on stablecoins, will be a key area of focus in their 2024 agenda.

Saylor revealed via social media that MicroStrategy has expanded its Bitcoin portfolio in April, purchasing an additional 122 BTC for $7.8 million. This latest acquisition follows their reported holdings of 214,278 BTC as of March 31. This indicates company might have purchased 32 BTC subsequent to their March 19 disclosure of 214,246 BTC.

##Market Trends: After seven consecutive months of gains, the market entering a correction phase
**General trend:**
Bitcoin experienced a significant drop yesterday, plunging from around US$64,000 to below US$60,000, with support emerging near the 100-day moving average. The price is now seeing a contentious battle at the US$60,000 level as bulls and bears vie for dominance. This downturn in Bitcoin has precipitated a wider sell-off across the altcoin market. The earlier surge in Bitcoin's value during the first quarter, which saw it reach an all-time high of nearly $74,000, was largely attributed to the enthusiasm around the launch of U.S. Bitcoin ETFs. However, waning expectations for a Federal Reserve rate cut have dampened the appetite for riskier assets, leading to a stark decrease in investment inflows. Recent data indicates that 11 U.S. spot Bitcoin ETFs witnessed net outflows totaling US$182 million in April, a stark contrast to the US$4.6 billion net inflow recorded in March. April saw Bitcoin's value drop by nearly 15%, ending a seven-month streak of gains and marking its poorest monthly performance since the FTX collapse.

**Market Hotspots:**
**Restaking: **The restaking sector is gaining traction, spurred by recent developments in AI and DePIN technologies. New entrants such as Ether.fi (ETHFI) and Renzo (REZ) have captured market attention following their launches. Eigenlayer, a frontrunner in this space, has announced an airdrop of its EIGEN tokens, set to be available for sub_script_ion on May 10. This move by Eigenlayer is one to watch, as it could further fuel interest and activity within the restaking landscape.

**MEME: **The meme coin sector has been a standout during the current bull market, as evidenced by the proliferation of popular tokens stemming from the <a href="/price/solana-sol" target="_blank" class="blog_inner_link">Solana</a> blockchain in March and the Base chain in April. High-profile examples such as BOME, SLERF, MEW, and POPCAT have captured the attention of investors. Despite this enthusiasm, the recent market downturn has cast some uncertainty on the meme coin momentum. Observers are closely watching to see if and how quickly the meme coin frenzy will regain its strength.

**OP:** <a href="/price/optimism-op" target="_blank" class="blog_inner_link">Optimism</a> (OP) is a cost-efficient and swift Ethereum Layer 2 blockchain that leverages the [Optimistic Rollup] concept. This innovative structure enables the "optimistically" posting of transaction results without the need for immediate execution on the Ethereum mainnet (most of the time). In the face of a broader market downturn, OP has shown remarkable resilience, registering a 1.68% uptick in value and distinguishing itself as a top performer in the Layer 2 sector.

**W:** Wormhole (W) stands as a pioneering project in the cross-chain communication space, providing a universal messaging protocol that facilitates interoperability across various blockchains. The newly introduced native W token now enjoys cross-chain circulation and utility on platforms such as Solana, Ethereum, Arbitrum, Optimism, and Base, thanks to the Wormhole Native Token Transfer (NTT) feature. Looking ahead, the project is set to launch MultiGov, the industry's inaugural multi-chain governance system, alongside W token staking governance mechanisms.

The current market fervor continues to center around newly launched tokens, contrasting with the MEME and AI sectors that previously enjoyed rapid gains but are now experiencing a lull. This dynamic reflects a cautious approach to speculative investments, driven by Bitcoin's lackluster performance and a broader tightening of macroeconomic liquidity， and represents the market is exhibiting a pattern with  rapid booms and busts in various sectors and tokens,

##Macro: Federal Reserve Meeting to Shed Light on Possible Rate Cut Signals

The Federal Reserve will convene for a two-day meeting from April 30 to May 1 to discuss interest rates, with the decision for May set to be announced at 2 a.m. Beijing time on Thursday.

Amidst a backdrop of slower-than-anticipated U.S. GDP growth in the first quarter and rising inflation, the consensus among economists and market analysts is a high likelihood that the Fed will maintain current interest rates in May. There's a growing expectation that the Fed may revert to a hawkish stance, a sentiment that could be reflected in the upcoming May interest rate decision announcement later this week.

Leading economists from Bloomberg Economics, Barclays, and KPMG concur that the Federal Reserve may initiate interest rate cuts as soon as September or December, limiting rate reductions to a single instance this year due to a slower improvement in inflation. While a rate hike seems unlikely, continued disappointing inflation data leaves the door open for a potential resumption of rate increases.

Regarding the upcoming interest rate meeting, the focal point for the market extends beyond immediate rate adjustments. Analysts are keenly awaiting insights on inflation trajectories, the Fed's confidence in managing inflation, the anticipated timing for any rate cuts, and the long-term outlook on interest rate hikes.

Amidst sluggish inflation progress, the market is questioning the Federal Reserve's ability to reach its 2% inflation target. While Fed officials might not revise their quarterly interest rate projections, inflation trends are expected to be a key topic of discussion.

In the capital market, U.S. stocks have shown weakness recently. The three major U.S. stock indices ended sharply lower yesterday, with the Nasdaq dropping 2.04% and the S&P 500 down 1.57%. Cryptocurrency-related stocks followed suit, with MicroStrategy plunging up to 17%.

The continued net outflows from crypto spot ETFs suggest a challenging environment for improving macro liquidity in the near term. We will continue to track the progress of this month’s interest rate meeting.

<div class="blog-details-info">
<div>Author:** Carl Y.**, Gate.io Researcher
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>

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Daily news | The U.S. spot Bitcoin ETF has reduced its holdings by about 1,698 BTC yesterday; MicroStrategy added 122 BTC to its portfolio in April

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