Ethereum strong, despite hack
Bitcoin has remained stable within its familiar range over the past week, while Ether has shown surprising resilience despite news of a hack. But that changed on Monday. Find out what this means, how it happened, and the key events that shaped the week in this edition of Bitvavo Market News.
Market update
At the end of 2022, the collapse of FTX pushed the crypto market to the depths of the bear market, marking the start of a new market cycle. From its low point, Bitcoin's price surged 600% in two years, from ā¬15,000 to ā¬105,000, setting a new all-time high well above the previous record price of 2021, when the rally stopped just below ā¬60,000.
BTC is currently around ā¬85,000 at the time of writing, following a significant drop on Monday and Tuesday morning. It remains to be seen whether this is a temporary dip or if BTC will end the week at this level or lower. In that case, we will need to assess whether the market structure has changed. It is still too early to say.
For many altcoins, the picture is less rosy. Most are still well below their highs of the previous bull market. Since peaking locally in December, altcoins have also declined more sharply than Bitcoin.Ā
The total market value of the altcoins ranked 3 to 125 has dropped by 30% compared to the December peak. This is nearly twice the loss of Bitcoin, which is currently down around 18%.
We've covered the top-ranked cryptocurrency and those ranked third and beyond, but in second place is Ether, the currency of the Ethereum network. Ether is under serious pressure this market cycle, both in terms of sentiment and price.
It was all the more remarkable how well ETH held up after Friday. Last Friday, the largest hack the crypto world has ever experienced saw more than 500,000 ETH stolen, with a market value of ā¬1.3 billion. A wave of uncertainty engulfed the crypto market. What would be the consequences?
So far, however, the impact has been minimal. There were no panic sales, a sign that the correction could be coming to an end: when even bad news fails to shake the market. If ETH can build momentum from here and push into the ā¬3,500āā¬3,800 range, it could set the stage for a move toward new all-time highs.
Featured
The institutions have arrivedĀ
For years we've heard the mantra, "The institutions are coming!" Every bull market brings renewed expectation... First, it was Fidelity offering Bitcoin. Then came Tesla with a billion-dollar position on its balance sheet. And now? Now we finally have some hard data to analyze as the 13F filings are in.
13F filings are mandatory quarterly reports for institutional investors active in the financial market in the United States. Any party with more than $100 million in assets under management must file this documentation with the SEC. This includes hedge funds, pension funds, insurers, and sovereign wealth funds.
Why do these filings matter?Ā Because they give us a rare glimpse at the very biggest financial players in the world.Ā It's like getting to peek into a billionaire's investment portfolio - you see exactly what stocks, ETFs, and other securities they own.
Bitcoin enthusiasts have been tracking 13F filings for years, but until now, theyāve revealed little in the way of crypto investments. That all changed with the launch of spot Bitcoin ETFs in 2024. These funds suddenly made it possible for institutional parties to build exposure to Bitcoin in a way that was simple and familiar to them. Now the big question is: did they actually take the plunge?
The answer: yes, but cautiously.
The latest 13F filings show that 1,573 institutional parties own Bitcoin. That sounds impressive, but the reality is modest. Indeed, the average allocation remains around 0.1% of their portfolios. The positions are small, and in many cases purely tactical - hedge funds and market makers taking opportunities rather than making a principled choice for Bitcoin.
Abu Dhabi's sovereign wealth fund (Mubadala) invested $400 million into a Bitcoin ETF. That may sound like a massive sum, but it's less than 0.15% of their total assets. It's like a billionaire buying the latest iPhone; it doesn't mean he's suddenly an Apple fanatic.
Then there's the Wisconsin state pension fund, which allocated $321 million into Bitcoin-related funds. Serious money? Absolutely. But again, the allocation remains below 1%. This isnāt a flood of institutions rushing in; itās more like a few cautious investors dipping their toes in the water.
Yet there is one fact that cannot be denied: the gates are open. The first steps have been taken, and now the question is: will institutional investors start increasing their allocations in a meaningful way?
The median Bitcoin exposure at these institutions is only 0.1% right now. That means there is still huge potential for growth. BlackRock previously suggested a Bitcoin allocation of 1-2% in a balanced portfolio. Other models even indicate that an allocation of 13% would be optimal.
The next few quarters will be exciting. TheseĀ 13F-filings are just a snapshot in time, and what seems like a baby step now may be the start of a larger movement. But for the time being, we must be especially careful not to mistake early signs for a full-scale trend.
In other news
No expanded powers for the SEC: regulator withdraws appeal on 'dealer rule'. The controversial definition of what constitutes a "dealer" would have placed certain DeFi protocols, market makers, and OTC traders under stricter securities rules, giving the SEC more control over the crypto market. However, a federal judge ruled that the SEC had overstepped its mandate. ByĀ withdrawing the appeal, the regulator is effectively giving up the legal fight. This is part of a broader trend of declining regulatory pressure on the crypto sector.
Solana not dead, but taking a hit in a weak market. Solana's price fell more sharply than its closest competitors in recent weeks. After the misplaced hype surrounding the $TRUMP token, the $LIBRA scandal, and rumors of insider trading at Solana,Ā panic intensifiedāthough no concrete evidence has surfaced. Despite this, 67% of Solana's DEX volume still comes from trading memecoins. In short, this is not the end, just a correction, andĀ for some, a buying opportunity.
Michael Saylor argues US should buy 20% of all Bitcoin. Speaking at the Conservative Political Action Conference (CPAC) on February 20, Saylor argued thatĀ a $393 billion investment in Bitcoin would strengthen the U.S. dollar and help reduce the national debt. HeĀ warned that if the U.S. does not do this, other countries such as China or Russia might seize this opportunity instead. In doing so, Saylor conveniently plays into the proposals by U.S. states to build Bitcoin reserves. Critics doubt that such a massive acquisition is realistic or even desirable.
More than 50 major companies outside the crypto world are building on Ethereum. According toĀ a new report from Galaxy Digital. Banks, luxury brands, and other industries are using Ethereum and Layer 2 solutions for NFTs, tokenized assets, and scalable infrastructure. The financial sector in particular is leading the charge; 10 banks are actively working on tokenizing assets such as money market funds and government bonds. This growing adoption positions Ethereum as a key bridge between traditional finance and the world of decentralized technologies.
Satoshi Radio:Ā In the latest episode of Satoshi Radio, the hosts discuss $LIBRA, the memecoin promoted by Argentine President Javier Milei. What's going on, and more importantly, what are the implications? In the rest of the episode, you'll hear about U.S. states potentially establishing bitcoin reserves, the 13F filings of major corporations and, of course, an extensive market update.
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