IBIT Shatters Inflow Records with $788M Surge

Plus Do Kwon Wins Third Extradition Appeal

Author

Nathaniel Whittemore
March 06, 2024

The Breakdown First Five - Wednesday, March 6, 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.

IBIT Shatters Inflow Records with $788M Surge

5. Rough New High

Bitcoin made a new all time high, rising a few hundred dollars above $69,000. The coronation turned into a bloodbath, with an immediate rejection into a drawdown. Bitcoin bottomed 14% down off the new alltime high, hitting prices not seen in three days. It’s all probably fine, with Bitcoin recovering above $66,500 overnight, perhaps gearing up for another shot at a breakout. 

4. Liquidity Becomes Liquidations

The volatile day led to a massive wave of liquidations. $320M for Bitcoin, $1B across broader markets, frothy memecoins rinsed a ton of leverage. Funding rates reset by 20% and $3B worth of Bitcoin open interest was taken down. This was the largest liquidation cascade since at least August, with most of the pain on the long side. Leverage is quickly rebuilding, suggesting that traders have reloaded for another run at the highs.

3. Shapeshift Pays the Fine

The SEC has circled back for enforcement action against Shapeshift almost three years since the service shut down in the US and decentralized into DAO ownership. Shapeshift paid a $275M fine, admitted no fault and agreed not to breach securities law. The action specifically targeted pre-decentralization operations, suggesting the SEC didn’t want to pick a fight on that issue. No tokens were named as securities specifically. Sounds like a parking ticket. 

2. Do Kwon Wins Third Appeal

Terraform Founder and apparently cunning defendant Do Kwon has once again won an appeal to avoid extradition to the US. The appeal court found there were defects in the lower court decision regarding which order extradition requests had been made by the US and South Korea. Kwon is adamant that he should be sent to South Korea. The case will be returned to the lower court for a retrial. Maybe one day the extradition will actually stick.

1. IBIT Record Inflows

Earlier in the day ETF volumes showed a massive spike, coming in 20% higher than the previous record. Most assumed this was paper-handed boomers getting out during the crash. Turns out ETF buyers have diamond hands. Blackrock’s ETF notched up $788M worth of inflows, blowing the previous record out of the water. Other flows were mild, GBTC recorded $332M in outflows. Total flows at $662M, good enough for the third highest day.