The crypto market in March 2024: The crypto market at the beginning of March 2024 showcases both promising trends and challenges, reflecting its dynamic nature. Despite occasional fluctuations, the overall trend in the crypto market continues to be bullish. bitcoin, the flagship cryptocurrency, has been leading the charge with its price surpassing significant milestones.
Bullish Trends in the Crypto Market
The crypto market is experiencing a bull run as bitcoin’s price continues to soar. This trend has captured the attention of investors, with Coinbase, one of the largest crypto exchanges globally, seeing increased demand for digital assets.
Coinbase’s stock has been under scrutiny by Citron Research, an investment research firm established by a notable short-seller on Wall Street. This comes after Coinbase encountered technical challenges amidst the turbulent price fluctuations of bitcoin earlier this week.
According to Citron, the long bitcoin/Short Coinbase trade is one of the most compelling trades in the crypto market due to Coinbase’s recent site malfunction. This means going long on bitcoin through an ETF and short selling the bloated Coinbase exchange.
Users reported zero account balances and errors when purchasing and selling digital assets during Coinbase’s brief disruption on February 28. However, the exchange guaranteed the Website security of all user balances, and the issue was resolved within a few hours.
Coinbase has risen to the position of the fourth-largest publicly traded exchange globally, following the January approval of multiple spot bitcoin ETFs by the US Securities and Exchange Commission (SEC). This week witnessed the highest level of demand for digital assets in over two years, as bitcoin surpassed $60,000 USD.
SEC’s Jurisdiction on Crypto Assets
The SEC faced criticism from eight state attorneys general in the US for overstepping its delegated authority in the action against cryptocurrency exchange Kraken.
A united amicus brief was filed on February 29 by authorities from Arkansas, Iowa, Mississippi, Montana, Nebraska, Ohio, South Dakota, and Texas. The filing stated that the SEC was expanding the definition of an “investment contract” and that states are in a position to prevent the SEC from violating state laws, including consumer protection laws, by attempting to regulate crypto assets as securities.
The attorneys general argued that Congress has not granted jurisdiction to the SEC for regulating crypto assets without an investment contract and that states have a vested interest in protecting their citizens.
Elon Musk Sues OpenAI
Elon Musk, the CEO of SpaceX, Tesla, and X, is suing OpenAI and its CEO, Sam Altman, alleging a breach of their nonprofit agreement.
According to the recent petition in the Superior Court of California for the County of San Francisco, Musk claims that OpenAI’s work with Microsoft deviates from the company’s founding goals of advancing open-source artificial general intelligence (AGI) for the benefit of humanity.
The legal case alleges contract breach, fiduciary obligation violation, and unfair business practices. Musk wants OpenAI to return to its open-source ethos and seeks an injunction to prevent the commercial use of AGI technology.
According to the court complaint, ChatGPT-4, launched in March 2023, deviates dramatically from OpenAI’s principles. Despite being touted as a breakthrough in ai, GPT-4 is a closed model, unlike previous versions. Musk argues that this shift toward proprietary technology benefits Microsoft financially and contradicts OpenAI’s original charitable objective.
Market Correction for bitcoin
bitcoin experienced a market correction after investors in Grayscale’s spot bitcoin ETF withdrew $598.9 million, the fund’s second-largest net outflow on record.
bitcoin reached a 24-hour high of $63,585 early on February 29 but has subsequently fallen approximately 3.3% to just under $61,500. This comes as the Grayscale bitcoin Trust (GBTC), the asset manager’s freshly converted ETF, suffered daily net outflows of $600 million on February 29.
“Two steps forward, one step back,” Bloomberg senior ETF analyst Eric Balchunas said in a Feb. 29 post about the day’s outflows.
The new GBTC outflows may reduce the day’s inflows. Preliminary data from Farside shows that Fidelity’s bitcoin ETF, one of the top three largest funds by assets, earned only $44.8 million in net inflows on February 29, its fourth-lowest day of inflows.
