Weekly Pulse #16: June 17th – 23rd

Mark Vermeulen, 3 min read
Last Updated: 24 June, 2024

Crypto Market Weekly Recap

The crypto markets faced another turbulent week, as macroeconomic headwinds and regulatory uncertainty continued to dampen investor sentiment. However, there were also signs of resilience, with some major cryptocurrencies posting gains and blockchain platforms seeing robust development activity.

Trump-Themed Memecoin Controversy Deflates

A cryptocurrency supposedly created in collaboration with former President Donald Trump’s son faced credibility issues this week. DJT, a Trump-themed memecoin built on the Solana blockchain, had spiked to a $465 million market capitalization earlier in the week on claims that Barron Trump was involved in its creation.
However, Trump associates denied any family participation. Martin Shkreli, the reported developer of DJT, continued asserting he worked with Barron and even proposed a $100 million wager, but provided no evidence. By Friday, DJT’s market capitalization had cratered to around $100 million as the controversy deflated.

SEC Ends Investigation into Ethereum’s ConsenSys

In a small win for the crypto industry, the Securities and Exchange Commission (SEC) closed an investigation into blockchain software company ConsenSys without taking enforcement action. The agency had been probing whether ConsenSys’ work on the Ethereum 2.0 upgrade constituted an unregistered securities offering.
ConsenSys said it would continue its lawsuit against the SEC seeking clarity on Ether’s regulatory status. The move could pressure the agency to provide clearer guardrails for blockchain projects.

TON Blockchain Flourishes Amid Crypto Slump

The market downturn barely dented investor enthusiasm for the Telegram Open Network (TON) blockchain and its native Gram token. This week, TON hit fresh all-time highs in activity and Gram reached a $18 billion market capitalization, surpassing Dogecoin.
Several factors powered TON’s rise, including growing traction for its blockchain-based games. Pantera Capital announced plans to raise funds for a TON investment vehicle on Friday, just two months after leading TON’s largest-ever funding round.

Tether and Circle Hold Significant U.S. Debt

Analyses this week revealed that the companies behind the two largest stablecoins hold immense portfolios of U.S. debt. Tether holds $91 billion in U.S. Treasuries, making it the 18th largest holder globally, while Circle owns $29 billion.
Together, they hold more Treasuries than most sovereign nations. Tether’s massive reserves could leave it exposed if U.S. debt levels continue climbing. Some experts suggested diversifying into alternatives like gold could hedge risks.

Canada Approves First Solana ETF

Cryptocurrency asset manager 3iQ gained approval to launch Canada’s first exchange-traded fund (ETF) providing exposure to Solana’s SOL token. The ETF will trade on the Toronto Stock Exchange under the ticker $QSOL.
Observers say a Solana ETF in the U.S. seems likely eventually, but the SEC currently considers Solana an unregistered security. Broader regulatory clarity and the success of proposals like a planned Ethereum ETF could pave the way for similar Solana investment vehicles.

Legacy Markets Overview

Market Sentiment Sours on Weak PMIs

A risk-off mood gripped markets this past week amid disappointing PMI data from Europe’s largest economies. Germany’s 10-year bund yield fell 7 basis points while US Treasury yields also declined, reflecting growing concerns over economic growth prospects. Meanwhile, the tech-fueled stock market rally showed early signs of fatigue following substantial gains.

Eurozone Outlook Darkens with Lower PMIs

The eurozone outlook darkened after weaker-than-expected PMI figures from Germany and France missed forecasts. This pushed Germany’s 10-year bund yield down 7 basis points as bonds attracted buyers amid shifting risk appetite. Traders now expect an 80% chance of a third ECB rate cut by year-end, up from 65% earlier, along with market speculation around a potential recession.

The gloomy economic data comes as French political uncertainty weighs on investor sentiment after President Macron called a snap election. For the fifth straight week, European equity funds saw outflows as risks mount. Strategists cited rising support for far-right candidates as jeopardizing the region’s hoped-for rebound.

Triple Witching Day Arrives Amid Cautious Mood

US index futures drifted lower ahead of the market’s quarterly “triple witching” options expiration event, set to involve $5.5 trillion worth of contracts. The added trading activity saw stocks extend declines in Europe and spurred a cautious mood. Meanwhile, the recent tech stock surge showed initial indications of decelerating following substantial gains.

Outlook: Focus Turns to Eurozone & US Data

In the week ahead, markets will closely monitor eurozone and US data for clues on economic trajectories. Key releases include eurozone consumer confidence, US existing home sales and durable goods orders. Fed officials such as Thomas Barkin will also draw attention as traders gauge rate hike expectations. Though stocks retreated slightly this week, resilient US growth could spur a revival if upcoming figures exceed forecasts.

Mark Vermeulen

A native of the Netherlands with a degree in finance, Mark has emerged as an avid crypto enthusiast and expert. His dedication to blockchain technology and bitcoin adoption has made him the driving force behind the Dutch content of Ecoinomy. Mark's adventure began during college, where his passion for decentralized finance quickly caught his eye. His ability to simplify complex concepts around crypto has earned him prestige among Dutch investors and far beyond.