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The Daily: El Salvador to limit bitcoin activities in $1.4 billion IMF deal, Ark offloads Coinbase shares amid price slump and more

The Daily: El Salvador to limit bitcoin activities in $1.4 billion IMF deal, Ark offloads Coinbase shares amid price slump and more

The BlockThe Block2024/12/19 19:45
By:James Hunt

El Salvador agreed to limit various bitcoin-related activities in exchange for a $1.4 billion IMF loan that aims to promote fiscal and external stability.Cathie Wood-led investment firm Ark Invest sold 13,780 Coinbase shares worth $3.9 million on Wednesday as it rebalanced its Fintech Innovation fund weightings amid a sharp drop in COIN’s price.Bitcoin’s market cap recently reached 14% of gold’s, marking a new all-time high in relative valuation, according to data from Galaxy Research.The following article

The Daily: El Salvador to limit bitcoin activities in $1.4 billion IMF deal, Ark offloads Coinbase shares amid price slump and more image 0

Happy Thursday! In today's Daily, El Salvador agrees to limit its bitcoin-related activities in a $1.4 billion deal with the IMF, Ark Invest offloads Coinbase shares amid a 10% price slump, bitcoin's market cap reaches an all-time high against gold and more.

Meanwhile, Bitcoin miners MARA and Hut 8 continue to acquire more BTC for their reserves.

Let's get started.

El Salvador agrees to limit bitcoin activities in $1.4 billion IMF deal

El Salvador agreed to limit various bitcoin-related activities in exchange for a $1.4 billion IMF loan that aims to promote fiscal and external stability.

  • Specific requirements of the deal include limiting the public sector's bitcoin purchases, ensuring taxes are paid in U.S. dollars and the wind-down of the government-provided bitcoin wallet Chivo.
  • With additional financial support expected from the World Bank, the Inter-American Development Bank and other regional development banks, the total financing package is expected to be worth over $3.5 billion, the IMF said.
  • In June 2021, El Salvador became the first country to formally adopt bitcoin as a legal tender, as proposed by its President Nayib Bukele, in order to promote financial inclusion.
  • El Salvador will now make private-sector bitcoin adoption voluntary, deviating from its 2021 Bitcoin Law mandating acceptance.
  • However, the deal awaits final IMF board approval, contingent on El Salvador implementing agreed fiscal and regulatory reforms.

Ark Invest offloads Coinbase shares amid a 10% price slump

Cathie Wood-led investment firm Ark Invest sold 13,780 Coinbase shares worth $3.9 million on Wednesday as it rebalanced its Fintech Innovation fund weightings amid a sharp drop in COIN's price.

  • Coinbase's stock price fell 10.2% to close at $279.86 on Wednesday after Fed Chair Jerome Powell's hawkish speech cut the 2025 rate reduction outlook, rattling markets.
  • Ark Invest's ARKF maintains a 9.9% Coinbase weighting, making it the fund's second-largest holding behind Spotify, with a market value of around $110 million.
  • Coinbase is currently valued at $52.1 billion, according to The Block's data dashboard .

Bitcoin's market cap reaches new all-time high against gold

Bitcoin's market cap recently reached 14% of gold's, marking a new all-time high in relative valuation , according to data from Galaxy Research.

  • Additionally, combined Bitcoin ETFs in the U.S. now hold $129 billion in assets under management, surpassing the AUM of U.S. gold ETFs, which hold $128 billion and had a 20-year head start, K33 Head of Research Vetle Lunde noted.
  • Meanwhile, bitcoin's market cap of $2 trillion ranks it seventh among global assets, ahead of Saudi Aramco and silver, just behind Alphabet (Google).
  • The broader cryptocurrency market cap stands at around $3.8 trillion, with bitcoin maintaining dominance at 54%.

Hong Kong accelerates crypto exchange licensing with four new approvals

Hong Kong approved licenses for four more crypto exchanges on Wednesday — HKbitEX, Accumulus, DFX Labs and EX.IO — under its "swift licensing process."

  • The Securities and Futures Commission expedited licenses by closely engaging with applicants' management and conducting on-site inspections.
  • Hong Kong's crypto licensing regime, launched in June 2023, allows licensed exchanges to provide retail trading services as part of its push to become a crypto hub.
  • The SFC has previously issued three such licenses to OSL, HashKey and HKVAX.

The Open Platform launches TON Space self-custodial wallet

TON blockchain venture capital firm and venture builder The Open Platform (TOP) has officially launched TON Space , a self-custodial wallet that claims to have already been used by over 100 million Telegram users during its now-concluded beta phase.

  • Following the launch, both TON Space and the custodial Wallet platform on Telegram are presented in the same user interface, allowing users to toggle between the two custody options.
  • The wallet also plans to introduce new features, including a dapp catalog, DEX integration and staking solutions designed to support TON blockchain developers and increase the discoverability of their applications.

In the next 24 hours

  • U.S. PCE numbers are released at 8:30 a.m. ET on Friday.
  • FOMC member Mary Daly is scheduled to speak at 7:30 a.m.

Never miss a beat with  The Block's daily digest  of the most influential events happening across the digital asset ecosystem.


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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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