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Bitcoin + Gold ETF: Can They Work Together?

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Wall Street is blending digital gold Bitcoin with physical gold in new ETF filings, offering investors a unique opportunity to diversify their portfolios. This innovative approach combines the stability of gold with the growth potential of Bitcoin, providing a balanced investment option in the volatile financial markets.

  • New ETFs blend Bitcoin, gold, and Ethereum exposure.
  • Tidal Investments and Quantify Chaos Advisors file for a Bitcoin and Gold ETF.
  • BlackRock discloses further Bitcoin holdings amid ETF inflows.
  • Public Bitcoin miners diversify into AI as market cap exceeds $25 billion.
  • Tether launches a synthetic dollar backed by physical gold.

Stacked Bitcoin and Gold ETF

Tidal Investments and Quantify Chaos Advisors have jointly filed a prospectus for a new ETF offering indirect exposure to Bitcoin and Gold. This ETF will leverage investments to expose investors to both assets without directly purchasing them. It will invest in Bitcoin futures, gold futures, cash, reverse purchase agreements, and other Bitcoin or Gold-related ETFs. The ETF aims to blend Bitcoin and Gold strategies to offer complementary benefits despite the lack of correlation between these assets. It seeks to minimize short-term market fluctuations and provide stable investment opportunities.

“The Fund uses leverage to ‘stack’ the total return of holdings in the Fund’s Bitcoin strategy together with the total returns of holdings in the Fund’s Gold strategy. Essentially, one dollar invested in the Fund provides approximately one dollar of exposure to the Fund’s Bitcoin strategy and approximately one dollar of exposure to the Fund’s Gold strategy.”

BlackRock’s Bitcoin Holdings

BlackRock’s Global Allocation Fund disclosed that it owned 43,000 shares of the iShares Bitcoin Trust as of April 30. This follows two filings that BlackRock made on May 28, disclosing Bitcoin exposure in its Strategic Global Bond Fund and in its Strategic Income Opportunities Portfolio. The Bitcoin Exchange-Traded Funds (ETFs) experienced a modest inflow of $11.8 million on June 27, marking the third consecutive day of positive inflows. This trend is encouraging as Bitcoin maintains its position slightly above $60,000.

Public Bitcoin Miners and AI Diversification

Public Bitcoin miners have shown resilience post-halving, with a total market cap exceeding $25 billion. Amidst a challenging environment driven by a falling Bitcoin price, declining hash rate, and a meager hash price, public miners have diversified into AI. This surge in artificial intelligence has positively influenced the mining sector. For instance, Core Scientific has expanded its CoreWeave infrastructure to 270 MW, while Hut 8 received a $150 million boost for AI data center expansion. Bit Digital now derives an estimated 27% of its revenue from AI.

Tether’s Synthetic Dollar Backed by Gold

Tether has launched Alloy, a new platform introducing aUSD₮, a digital asset over-collateralized by Tether Gold (XAU₮). This innovative asset aims to combine the stability and familiarity of the US dollar with the enduring value of gold. The aUSD₮ token is designed to track the value of one US dollar, providing a stable unit of account while being backed by physical gold stored in Switzerland. The minting and management of aUSD₮ are handled through Ethereum-compatible smart contracts, ensuring transparency and security.

Wall Street Giants Competing for Bitcoin ETF

The competition among prominent players in the financial industry to launch the first Bitcoin spot ETF in the U.S. is intense. Over 12 applicants, ranging from disruptive Bitcoin companies to some of the most well-known names in global finance, are vying for approval. The prize is the potential to provide investors with a regulated and accessible vehicle to the world’s leading cryptocurrency. Notable applicants include Grayscale, 21Shares, ARK Invest, BlackRock, Bitwise, VanEck, WisdomTree, Invesco, Fidelity, Valkyrie, Global X, Hashdex, and Franklin Templeton.

This new wave of Bitcoin and Gold ETFs represents a significant step forward in the digital asset landscape, offering investors a modern approach to managing and transacting with digital assets.

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Stripe Launching Bitcoin Purchases in Europe

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Stripe, the global payment processing giant, has expanded its cryptocurrency integration into the European Union, allowing consumers to purchase Bitcoin, Ether, and Solana using their credit or debit cards. This move aims to simplify crypto transactions for European shoppers and online vendors.

Key Takeaways

  • Stripe enables crypto purchases in the EU, including Bitcoin, Ether, and Solana.
  • Online vendors can add a crypto-purchasing widget to their sites.
  • The expansion aims to make crypto transactions easier and more accessible.

Stripe’s European Expansion

Stripe, founded by Irish brothers Patrick and John Collison, has made a significant move by enabling cryptocurrency purchases in the European Union. This expansion allows consumers to buy popular cryptocurrencies like Bitcoin, Ether, and Solana using their credit or debit cards. The initiative is part of Stripe’s broader strategy to facilitate "normal transactions" using digital assets.

Benefits for Online Vendors

Online vendors in the EU can now integrate a crypto-purchasing widget on their websites. This widget not only simplifies the purchasing process but also manages charges, disputes, and Know Your Customer (KYC) compliance. According to John Egan, Head of Crypto at Stripe, this expansion will help merchants focus on growing their business and serving their customers by reaching a more global audience.

Previous Announcements and Partnerships

This latest development follows Stripe’s recent announcement to support USDC stablecoin payments for customer transactions. Additionally, Stripe has partnered with Coinbase to incorporate the crypto exchange’s Layer 2 network, Base, into its crypto payout products. These moves indicate Stripe’s commitment to expanding its crypto-related services and making digital asset transactions more seamless.

Market Impact

Stripe’s expansion into the European crypto market is expected to have a significant impact. Ireland, where Stripe is jointly headquartered, regularly scores highly in European surveys on per-capita cryptocurrency ownership. The company’s latest financial update revealed that it handled over $1 trillion in payments in 2023, marking a 25% increase from the previous year. With a valuation of $70 billion, Stripe continues to be a major player in the online payment industry.

Conclusion

Stripe’s decision to enable cryptocurrency purchases in the European Union marks a significant step in making digital asset transactions more accessible and straightforward. By allowing online vendors to integrate a crypto-purchasing widget, Stripe is helping to bridge the gap between traditional financial systems and the burgeoning world of cryptocurrencies.

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US Spot Bitcoin ETFs Witness $300 Million Inflows Amidst Seven-Day Positive Streak

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US spot bitcoin ETFs have experienced a remarkable $300 million inflow, marking the seventh consecutive day of positive flows. This surge is led by BlackRock’s IBIT, highlighting the growing investor confidence in bitcoin as a legitimate financial instrument.

  • US spot bitcoin ETFs reported a daily net inflow of $301 million, extending a seven-day positive streak.
  • BlackRock’s IBIT recorded the largest net inflows of $117.25 million.
  • The total net inflow for US spot bitcoin ETFs since January has reached $16.11 billion.
  • Bitcoin’s price has surged past $64,000, trading at $64,770.
  • Spot ether ETFs are expected to launch on July 23.

BlackRock Leads the Charge

BlackRock’s IBIT, the largest spot bitcoin ETF by net asset value, recorded the highest net inflows of $117.25 million. The fund also saw the most trading activity, with a volume of $1.24 billion. Other notable inflows included Ark Invest and 21Shares’ ARKB with $117.19 million, Fidelity’s FBTC with $36.15 million, and Bitwise’s BITB with $15.24 million.

Market Performance and Investor Sentiment

The total trading volume for US spot bitcoin funds on Monday was $2.26 billion. Although this is lower than the trading volumes seen in March, the ETFs have accumulated a total net inflow of $16.11 billion since their launch in January. The price of bitcoin has also seen a significant recovery, breaking above $64,000 and currently trading at $64,770.

Institutional Endorsement

BlackRock CEO Larry Fink recently stated that bitcoin has become a “legitimate financial instrument,” a significant shift from his previous skepticism. This endorsement from a major financial institution has likely contributed to the growing investor confidence and subsequent inflows into bitcoin ETFs.

Upcoming Launches and Market Outlook

Spot ether ETFs are anticipated to launch on July 23, further expanding the range of cryptocurrency investment options available to investors. The continued positive inflows and institutional endorsements suggest a bullish outlook for bitcoin and other cryptocurrencies in the near future.

The recent inflows into US spot bitcoin ETFs underscore the growing acceptance and legitimacy of bitcoin as a financial instrument. With major players like BlackRock leading the charge and upcoming launches of ether ETFs, the cryptocurrency market is poised for continued growth and investor interest.

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Trump Picks Pro-Bitcoin Vice President

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Donald Trump has announced Ohio Senator JD Vance as his vice-presidential running mate for the 2024 election. This decision underscores a significant shift towards pro-Bitcoin and cryptocurrency policies, as Vance has previously declared owning between $150,000 and $250,000 worth of Bitcoin in 2021

  • Pro-Crypto Stance: Both Trump and Vance are vocal supporters of cryptocurrency, aiming to reshape the regulatory landscape.
  • Financial Disclosure: Vance holds between $100,000 and $250,000 in Bitcoin, highlighting his personal investment in the sector.
  • Legislative Efforts: Vance has introduced multiple bills to make crypto regulations more industry-friendly.
  • Political Implications: The choice of Vance could sway crypto voters, a growing demographic in swing states.

A Pro-Cryptocurrency Ticket

Donald Trump and JD Vance have created a pro-crypto presidential ticket, signaling a major shift in the Republican Party’s approach to digital assets. Vance, a former venture capitalist and author of the best-selling memoir “Hillbilly Elegy,” has been a vocal critic of the Securities and Exchange Commission’s (SEC) stringent crypto regulations. He has introduced and supported various bills aimed at making the regulatory environment more favorable for the crypto industry.

Financial Interests

Vance’s financial disclosures reveal that he owns between $100,000 and $250,000 in Bitcoin, held on the cryptocurrency exchange Coinbase. He also has investments in a gold ETF, a crude oil ETF, and a brokerage account with Charles Schwab. His estimated net worth ranges between $5 million and $10.5 million.

Legislative Efforts

Vance has been actively involved in drafting legislation to revamp how the U.S. regulates digital assets. His proposed bills aim to overhaul the roles of the SEC and the Commodity Futures Trading Commission (CFTC) in policing the crypto market. One of his notable efforts includes a bill to protect banks from regulatory pressure to cut off services to crypto firms, prohibiting regulators from citing “reputational risk” as a reason for action against lenders.

Political Implications

The choice of JD Vance as Trump’s running mate could have significant political implications. A Harris Poll survey found that one-fifth of voters in swing states consider cryptocurrency policies important enough to influence their vote. With political action committees raising substantial funds to support pro-crypto candidates, the Trump-Vance ticket could attract a considerable number of crypto voters.

Criticism of SEC Chair Gary Gensler

Vance has been a staunch critic of SEC Chair Gary Gensler, calling him “the worst person” to regulate the crypto industry. He has accused Gensler of injecting too much politics into securities regulation and has opposed the SEC’s enforcement actions against crypto firms. Vance’s stance aligns with the broader Republican agenda to create a more favorable environment for digital assets.

Trump’s selection of JD Vance as his running mate marks a significant shift towards pro-crypto policies in the 2024 election. With Vance’s strong financial and legislative backing for the crypto industry, the Trump-Vance ticket aims to attract a growing demographic of crypto voters, potentially influencing the election outcome.

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