BlackRock is Taking Over! They Will Tokenise Everything!

It wasn’t so long ago that BlackRock CEO Larry Fink was calling Bitcoin ‘an index of money laundering’, before realising just how much money he and his company could make from it. How things change.

But, when it comes to crypto, it’s not just spot ETFs that have BlackRock all hot under the collar. While issuing such an ETF has proved very profitable thus far, there is even more money to be made from the tokenisation of other, more traditional assets - that is, every asset you can think of and probably plenty you can’t as well.

In a recent piece for Bitcoin Magazine, investigative journalists Whitney Webb and Mark Goodwin lifted the lid on BlackRock’s tokenisation plans and - surprise, surprise - they’re pretty darn sinister. As we’ve seen with stablecoins like USDT and USDC, just because an asset is on a blockchain doesn’t mean it’s beyond the reach of those who might try to control what the ‘owner’ of said asset can or can’t do with it.

In today’s video, we break down Whitney and Mark’s article and look at how, even though BlackRock has helped pump all our bags this year, we should think twice before welcoming it and other titans of Wall Street into the crypto fold. They could well turn out to be wolves in sheeps’ clothing.

You can watch that video here.

📈 Crypto Market Forecast 📈

Crypto has a big week ahead of it. That’s because there are multiple crypto and macro factors that could cause the market to rally, crash, or perform some combination of both. The first crypto factor to watch out for is the listing of the spot Bitcoin and spot Ethereum ETFs in Hong Kong this Tuesday, April 30th.

Depending on the inflows these ETFs see, they could be a tailwind for BTC and ETH. These tailwinds will be much-needed, because the crypto market could face headwinds from the sentencing of former Binance CEO Changpeng Zhao, scheduled for the same day. If CZ is sent to prison for a long time, it will be especially bearish for BNB.

Besides CZ’s sentencing, it’s possible the crypto market will be buffeted by additional headwinds. This is because US authorities seem to be escalating their crackdown on the crypto industry. The recent arrests of the Samourai wallet developers and the de facto warning about crypto wallets issued by the FBI are just two of many examples.

Another example is the SEC’s Wells Notice to Consensys, which is basically giving the company a heads up that it plans to sue in roughly 30 days. The catch is that the Wells Notice was reportedly given on April 10th. It’s possible that the SEC has also issued Wells Notices to other crypto entities, who could reveal this week that they’re on the regulator’s radar.

Thankfully though, it’s possible that the crypto market will get a lift from another tailwind. This could come in the form of stablecoin regulations in the United States, which are apparently close to being passed. With US politicians having already dealt with other issues such as foreign aid, it’s possible that a stablecoin bill could be passed this week (or at least tabled for a vote).

This ties into the macro factors, the first of which is the risk that there will be further escalation in the Middle East. To bring you up to speed, Iran recently attacked Israel in retaliation for Israel’s attacks on Iran’s embassy in Syria. In response to Iran’s recent attack, Israel said it would retaliate further but not until after Passover, which likewise lasts until April 30th.

As we’ve seen, the crypto market and the stock market have both been extremely sensitive to escalating tensions in the Middle East. It’s possible that last week’s weakness in the markets was down to investors trying to price in the possibility of more escalation after Passover. This would explain why oil prices started creeping up towards the end of last week.

That said, it’s possible that crypto and stocks were trying to price in another massive macro factor, and that’s the Fed’s next interest rate decision, due this Wednesday, May 1st. Sticky inflation, sudden economic weakness, and the risk of further geopolitical escalation has put the Fed in a tough spot. It’s likely Jerome and co will act dovish to try and calm the markets.

But, the Fed’s decision pales in comparison to the biggest macro factor of all: the Treasury Department. In case you haven’t noticed, fiscal policy AKA government spending has essentially been keeping the markets and the economy afloat. On the same day as the Fed’s decision, the Treasury Department will announce its fiscal policy plans.

Up until now, the Treasury has been focused on selling short-term US government debt. The practical effect of this has been to keep long-term interest rates low. The Treasury has been able to do this because it's effectively been able to finance all the short-term debt using money from the Fed’s Overnight Reverse Repo Facility.

However, the money in this facility is now almost drained. This means that the Treasury will  have to issue more long-term government debt, which will cause long-term interest rates to rise. As we saw in October last year, this would be bearish for crypto and stocks. The caveat is that the Treasury will simultaneously announce plans to buy back certain long-term bonds.

When you combine this with the likelihood that the Fed will likely slow the pace of its balance sheet runoff, you end up with a very mixed bag on the macro front. In short, long-term interest rates could be driven significantly lower or significantly higher depending on what the Fed and Treasury decide. It’s safe to say that it’s going to be an exciting week…

💲 Runes: Post-Launch Review 💲

It’s been exactly a week since the launch of Casey Rodarmor’s highly-anticipated Runes protocol.

If his name sounds familiar, that’s because Casey is also the brain behind the hugely successful Ordinals protocol, which launched last year. To put it bluntly, Casey’s Ordinals protocol enabled the mainstream creation and adoption of “NFTs” on Bitcoin.

With Casey’s Runes protocol being an attempt to replicate that success for fungible tokens on Bitcoin, it should come as no surprise that many have had extremely high expectations for Runes.

However, was the launch just another nothing burger event like some have suggested, or did it actually manage to live up to all the hype? Well, let’s start by going over some Day 1 on-chain metrics and then see its evolution shortly after.

As expected, transaction fees on the Bitcoin network spiked to a new all-time high on Day 1.

Specifically, data from YCharts reveals that the ‘average transaction fee’ on the Bitcoin network hit a record high of $128.45 on launch day April 20th. This is almost double the previous all-time high of $58.74 recorded back in April 2021.

Also, note that we’re referring to the ‘average transaction fee’ and not the ‘highest transaction fee’ paid on the Bitcoin network. The ‘average transaction fee’ is a good metric to judge the performance of Runes protocol, since the primary purpose of Runes is to allow traders to gamble on shitcoins natively within the Bitcoin network.

The higher the average transaction fee, the more volume of transactions on Bitcoin. If you read last week’s issue of this newsletter, you’ll know that a higher transaction volume and higher average transaction fee are important for the future of Bitcoin.

That said, April 20th also happened to be the day of Bitcoin’s halving. This begs the question of just how much of this spike in transaction fees was from halving-related activity vs from Runes protocol-related activity.

The answer to this question can be found in data represented on a handy Dune Dashboard by CryptoKoryo. The Dashboard reveals that Runes-related transactions accounted for almost 72.7% of all transactions on the Bitcoin network on April 20th. Ordinary Bitcoin transactions accounted for 26.6%, while Ordinals and BRC-20s only accounted for 0.5% and 0.2% respectively.

Safe to say then, Day 1 was a success. However, this data also reveals that much of the attention present on Ordinals and BRC-20s has now shifted to Runes. Koryo’s Dune dashboard substantiates this by showing that Runes-related transactions have continued to dominate the total share of all Bitcoin transactions in the days following.

Before Runes, both BRC-20s and Ordinals consistently accounted for a double-digit share of the total share of transactions on Bitcoin. However, week 1 of Runes shows them struggling to even capture a single-digit share of the transaction volume.

We suspect BRC-20s will eventually recover in the short term, though it's hard to say if they’ll ever come back to their previous levels. The most likely scenario is that existing BRC-20 projects will live on, while new ‘fungible token’ projects will choose to launch on Runes instead of using the BRC-20 token standard. Given the week 1 data, there’s a high chance that BRC-20s could be phased out of the BTCFi lexicon in the long term.

That said, let’s now take a look at some of the Runes projects fighting for space on the leaderboard. As predicted last week, both Rune Coin and Rune Stones appear to be doing well post-launch.

The team behind the Rune Stones Ordinals project managed to secure Rune#3 with the ticker DOG•GO•TO•THE•MOON, while the team behind the Rune Coin Ordinals project secured Rune#8 with the ticker RSIC•GENESIS•RUNE.

Both projects have managed to maintain provenance by being one of the first 10 Runes to be etched on the protocol. They also appear to be within the top 10 largest market cap Runes projects, as per data shown on Magic Eden.  Other notable Runes projects that have been trending on the leaderboard include Rune#6 SATOSHI•NAKAMOTO, Rune #1 Z•Z•Z•Z•Z•FEHU•Z•Z•Z•Z•Z, and Rune#2 ⚡️DECENTRALIZED.

That said, there doesn’t appear to be an authoritative source on market cap ranking just yet. A lot of the data surrounding Runes is still hard to navigate. Thankfully, this means things are still quite early on Runes.

To quote Ordfluencer Leonidas on X, “Ordinals are just NFTs on Bitcoin and Runes are just memecoins on Bitcoin. If you are somehow able to find a way to rationalise fading shitcoins on Bitcoin in your head then crypto probably just isn't for you.”

Don’t be that person.

🔥 Hot Deal of The Week 🔥

The biggest mistake that you can make in crypto is not controlling your own private keys.  “not your keys, not your crypto”.

When the retail crypto craze begins, you do run the risk of hardware wallets being sold out everywhere. So, it might be a good idea to get those hardware wallets ahead of time.

At Coin Bureau HQ the most widely used hardware wallet has got to be Trezor. So, be sure to bag your device while stocks last.

👉 Get your Trezor

🔮 Video Pipeline 🔮

* What Is Money? What Most Don’t Know!
* Runes: The new 100x Opportunity on Bitcoin
* Q1 CoinGecko Report: All you need to know about the markets

🏆 What's New at This Week? 🏆

* Unleashing Scalability: What Are Parallelized EVMs?
* Cosmos Review: ATOM & The Internet of Blockchains
* M6 Labs Crypto Market Pulse: Bitcoin DeFi Summer
* Best Cosmos Wallets: 7 Wallets for Storing Atom!
* Upbit Review 2024: Exploring Korea's Largest Crypto Exchange
* Decoding Crypto's Future: Monolithic vs Modular Blockchains
* Best AVAX DApps 2024: AVAX Projects with Potential!

Press Release

* MetaMask and Crypto Tax Calculator Team up to Save Crypto Investors This Tax Season

📖 Quote of the Week 📖

One of the biggest challenges to overcome when investing in crypto comes from within. Sometimes, our natural inclinations to FOMO in or panic sell can overshadow all the intense due diligence that came before. So remember, sometimes the best thing to do is… nothing.  

“Time is your Friend, Impulse is your Enemy” - John Bogle

Team Coin Bureau

Disclosure: Authors may own cryptoassets named in this newsletter. These are unqualified opinions, and a Coin Bureau newsletter, is meant for informational purposes only. It is not meant to serve as investment advice. Please consult with your investment, tax, or legal advisor. 

Guy Turner

Guy is one of the founding members and face of the Coin Bureau. Like many of us, he is just an average joe who became “crypto curious” back in 2013. After recognising the potential of blockchain technology, Guy set off on a mission to create crypto educational content, working with others to start the Coin Bureau website and released our first video on YouTube in 2019. You can learn more about him in his Who is Guy? blogpost.

Free Crypto Coverage Direct to Your Inbox