The Phenom Crypto Letter

GM,

Another relatively flat week as everyone takes a deep breath including us. We are adding a new section this week called “Reading List” where we take some of the guesswork out of the hordes of content out there. Just a list of newsletter, youtube or any other content we are reading this week. Pretty simple. Let us know what you think.

Thanks for being here and taking the time

Here’s what we’ve got this week:

• Introducing Reading List

• The impact of the ETH ETF

• Feds want 3 years jail for CZ

• Markets Flat and volatility is down

Market Rundown

The market seems to have calmed down w/ the halving finally over. Fear & Greed has been flat this week hover just above neutral. Volume and market cap are both down slightly but not enough to be concerned about. Overall it seems like everyone is just taking a bit of a breather to recoup after the last month of volatility. I’m expecting to see some slower but positive price action this spring with the halving complete and the ETH ETF decision coming next month.

Top Movers:

• (-) Toncoin ($TON) -11% After spiking on the news of its partnership w/ Telegram $TON is regressing back to the mean.

• (-)Maker ($MKR) -8% Down this week on speculation that the DAO is selling $MKR tokens.

• (+) Bonk ($BONK) +98% Memes are back this week

• (+) Pepe ($PEPE) +57% Pepe recovers quickly after last weeks correction

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Ethereum's ETF Approval: A Game-Changer on the Crypto Chessboard?

The cryptocurrency community is poised on the brink of another significant milestone with the potential approval of an Ethereum (ETH) Exchange Traded Fund (ETF) next month. This event invites comparisons to the earlier approval of a Bitcoin (BTC) ETF, which marked a major advancement in cryptocurrency's integration into mainstream finance.

Lessons from Bitcoin's ETF Approval

The approval of an Ethereum ETF could replicate and potentially surpass the impact seen from the Bitcoin ETF. Ethereum, being the backbone of various decentralized applications and smart contracts, offers a broader use case than Bitcoin's primary role as a digital store of value. The ETF would make Ethereum accessible to a wider array of investors, particularly those in traditional finance who are looking for regulated investment avenues without the direct risks of handling cryptocurrencies.

When the Bitcoin ETF was approved, it significantly boosted Bitcoin’s market visibility and investor confidence, resulting in increased market capitalization and stability. Similar effects are expected for Ethereum; however, Ethereum's ETF might draw even greater attention due to its foundational role in the burgeoning field of decentralized finance (DeFi).

Potential Market Dynamics

The introduction of an Ethereum ETF could enhance liquidity and potentially reduce the volatility associated with Ethereum's market. It is also likely to attract a surge of institutional money, similar to what was observed with Bitcoin, but possibly at a larger scale, considering Ethereum's utility in the DeFi sector and the ability to earn relatively risk-free yield.

Regulatory and Investor Sentiment

Both ETF approvals signal increasing regulatory acceptance of cryptocurrencies, but they also bring heightened regulatory scrutiny. While this might raise concerns about tighter regulations, the clarity can also lead to greater institutional adoption.

Our Take

The anticipated approval of an Ethereum ETF next month is not just a significant event for Ethereum but also an important development in the broader crypto market. By comparing it to the impact of Bitcoin's ETF approval, one can foresee the potential for even greater acceptance and integration of cryptocurrencies into the fabric of mainstream financial services. This step represents another leap toward the maturation and stability of the crypto markets. Most likely approval will be postponed and pushed out as far as possible similar to the BTC ETF but we think the eventual approval is inevitable. Once it is approved it will be a watershed moment that floods liquidity into ETH.

Reading List

Overwhelmed by all the content out there? Don’t worry, We’ve got you covered. Here are a few we think are worth checking out. Every week we will be dropping newsletters, youtube or anything else we are reading that we think is valuable.

BlockBuzz™️

Quick Hitters from the week

• Bitcoin Takes a Tumble: Price drops below $64,000 with $209 million in crypto long positions liquidated.

• Morgan Stanley Eyes Bitcoin ETFs for Clients: Report suggests brokers may soon offer Bitcoin ETF options to customers.

• Tough Sentence Loomed for Ex-Binance CEO CZ: U.S. Department of Justice seeks a 3-year prison term for Changpeng Zhao for violations of U.S. law.

• Crackdown on Cryptocurrency Mixing Service: Founders and CEO arrested, facing charges of money laundering and operating without a license.

• SEC Postpones Decision on Ethereum ETFs: Delays verdicts on spot Ethereum ETF proposals from heavyweights Franklin Templeton and Grayscale.

• SEC Demands $5.3 Billion From Do Kwon and Terraform Labs: Following a guilty verdict, the SEC seeks substantial penalties against Terraform Labs and its founder for regulatory violations.

• Ripple Counters SEC with $10M Settlement Proposal: Proposes a significantly lower penalty in response to the SEC's $1.9 billion demand amid ongoing legal struggles since 2020.

• NYSE Eyes Round-the-Clock Trading: Considers adopting a 24/7 trading model, inspired by the cryptocurrency markets, according to the Financial Times.

The Twitterverse

A collection of the most interesting stuff on Crypto Twitter this week

WAGMI

For the Crypto Culture

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