Bitcoin's Doorstep to All-Time Highs

The Breakdown First Five - Tuesday, March 5, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Microstrategy Re-Ups

With their stock ripping, Microstrategy is seeking another $600M in debt funding to double down on Bitcoin. The firm will raise the funds through a sale of convertible notes, choosing not to dilute the stock which was up 23% on Monday. The nosebleed gains seem to be driven by a short squeeze, with 20% of the float currently sold short. This has given the stock a 70% premium to the underlying Bitcoin holdings, a level we haven’t seen in years. 

4. Tether Hits $100B

The largest stablecoin has reached $100B in issuance for the first time. Issuance has been up only for the past year, but really picked up in recent months as market enthusiasm heats up. This last stretch has increased Tether dominance of stablecoins, which now sits at more than 70%. Overall stablecoin supply is still 30% shy of all time highs from 2022, but those included UST which famously detonated to end the last cycle.  

3. SEC Wins a Case 

The SEC has managed a rare win, with a judge finding that crypto tokens are securities. The catch? There was no defendant, so the judge was forced to accept all of the SEC’s arguments. The case related to the 2022 Coinbase insider trading scandal where low float tokens were traded ahead of listing on the exchange. This defendant had fled the country. The case has still been cited in other ongoing SEC lawsuits, but seems unlikely to be persuasive. 

2. Stanford Buys Bitcoin

The enterprising leader of the Stanford Blockchain Association managed to convince a small division of the Stanford endowment to get off zero. A 7% allocation has been made the six-figure Blyth Fund, which is operated by students. The investing committee was convinced by a bullish argument about ETF inflows, market cycles, and hedging against “monetary chaos and war”. They bought Bitcoin at $45,000 via the Blackrock ETF. 

1. Wen ATH?

Bitcoin is knocking on the door of all time highs, but failed to reach Valhalla on Monday. Trading was punctuated by a repeat of problems at Coinbase, with zero balance displayed to users again. Bitcoin managed to reach $68,850 in the evening, recording an 8.3% daily gain. All time highs are now in for Euro and GBP pairs and Bitcoin is close to surpassing Silver in overall market cap. We’re tantalizingly close to all time highs against the dollar.