HeadStarter

David Canellis

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire">subscribe</a>.



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You’ve probably heard by now that ETH is a cursed asset. Doomed.&nbsp;



Maybe you’ve read tweets that say Ethereum is destined to go the way of Intel — a stock that has collapsed in value by two-thirds over the past five years while competitors (Nvidia and AMD) have thrived by comparison.



It’s a take that only works if you focus solely on price and ignore how much activity <a href="https://x.com/blockworksres/status/1866165937319399705">persists</a> on <a href="https://x.com/blockworksres/status/1870159763251835367">Ethereum</a> and its <a href="https://x.com/blockworksres/status/1867705603357127054">surrounding</a> web of layer-2s and layer-3s.



Ether has only gained 30% in the past year while its direct rival, SOL, has about doubled.



Even XRP has easily beaten ETH over the bull market to date. XRP is now up more than 600% since the bottom of the last bear market in November 2022.&nbsp;



BTC has otherwise gained about 500% and SOL almost 1,500%. ETH does appear spookily dull by comparison.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1381" height="996" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=1024&amp;h=1024" alt="" class="wp-image-96190" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=1381 1381w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=356 356w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=362 362w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=304 304w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2.png?w=80 80w" sizes="(max-width: 1381px) 100vw, 1381px" /><figcaption class="wp-element-caption">At least ETH has beaten BNB</figcaption></figure>



Here’s an alternative theory: The relative overperformance of coins like SOL and XRP has nothing to do with ETH.&nbsp;



Let’s start with XRP. Ripple Labs’ ongoing clash with the SEC (which started in December 2020) had sidelined XRP for practically this entire market cycle, not to mention its underperformance through the 2021 bull run.



So, whatever gains XRP made in light of Trump’s win in November has more to do with catching up with the market than anything particularly special about the asset itself.



As for SOL, it pays to look back at how the top end of crypto really looked over the years.



Generally, the top three coins have stayed more-or-less the same since <a href="https://coinmarketcap.com/historical/20160701/">2016</a>: BTC, ETH and then XRP.



In <a href="https://coinmarketcap.com/historical/20170101/">2017</a>, the next most valuable were litecoin (LTC) and monero (XMR). It was those, plus bitcoin cash (BCH) and cardano (ADA) in <a href="https://coinmarketcap.com/historical/20180101">2018</a>; EOS in <a href="https://coinmarketcap.com/historical/20190101">2019</a>; BNB in <a href="https://coinmarketcap.com/historical/20200101">2020</a>.



LTC is now in 27th place — much further down in the market — while monero in 37th and bitcoin cash 23rd.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXc_Mt0EYZ-i8aHFXOHJeo4trZ5WqQyDVJAk3W9O_ezr__h-RXwpmiJKqxdlqDSSVRsv4WYLSnr46okdR2F8BQ4hF7cyWP8tNnpiuUk2LxKmAKT1TQQ7zlC9zDcbklyR6ajb49IIQw?key=FE5tRTq1iuwsq0q9VzVobGdQ" alt=""/></figure>



Compare the chart above to the first one, which only mapped price performance. It tracks the market caps of the top end of the market — and it makes clear just how much smaller all those coins are to ETH.&nbsp;



It’s only natural that they’d outperform ETH at certain parts of the cycle. While liquidity doesn’t necessarily map to market capitalization, smaller assets generally need much less fresh capital to move the needle that far.



It’s also not a coincidence that LTC, XMR and BCH, all bitcoin alternatives, have fallen off so dramatically between cycles.



Bitcoin has won the race as a store of value and stablecoins emerged to better fulfil the digital payments use case than litecoin.



Whatever mind and market share the major coins from yesteryear — the ones that never found product-market-fit at scale — may have simply been transferred to Solana.



So, the Solana renaissance has little do with the anticipated demise of Ethereum, and more to do with the shrinking significance of much older coins.&nbsp;



As for whether Ethereum will also become one of those “much older coins” sometime down the line — handwaiving that concern requires entirely different cope. Let me get back to you.



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Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

Ethereum cope to counter worries that ETH is doomed

Digital Asset staking has a problem.



Major institutional players increasingly want to participate, but most of today’s staking providers aren’t regulatory or enterprise-friendly. The status quo is infrastructure pieced together by small, sometimes inexperienced teams on centralized Big Tech clouds that are not tuned for digital assets – nor engineered to meet the regulatory compliance standards that major players like BlackRock demand. The traditional financial world has long-established standards for robust risk management strategies crucial to fulfilling institutional needs, and their service providers in the decentralized financial world must meet these requirements.



And this is only the beginning. There are several essentials that every institution must consider when evaluating staking options. This guide covers the top five, including:



<ul class="wp-block-list">
<li>Multi-Stake: diversification of providers, hardware &amp; approach</li>



<li>Security of people, processes &amp; technology</li>



<li>Service &amp; reporting</li>



<li>Custodial integrations &amp; relationships</li>



<li>Regulatory compliance, especially with audited practices like SOC 2 or ISO27001 – and CCSS</li>
</ul>



We’ll first explore why diversification is the foundation of a resilient staking strategy and how the remaining pillars build on it.



<h1 class="wp-block-heading">Diversification: The Cornerstone Of Institutional Staking &amp; Your Reassurance</h1>



Following the spectacular collapse of FTX, institutions and sophisticated holders alike took a step back to revisit their custody practices. A paramount consideration was the shift to custodian diversification. As highlighted by Boston Consulting Group, diversification minimizes the impact of a single point of failure across market, counterparty, regulatory, and security risks.1



With innovation thriving and new providers continuing to emerge, the institutional staking industry sector has adopted a diversification theme, focusing on similar risk mitigation considerations.&nbsp;



It extends beyond service providers – a diversity of core infrastructure, hardware, networks, ownership, and staking approaches is also essential. As with telecom and data networks in the early 2000s, reliance on “diverse” providers that ride on the same physical layer undermines true diversity.



Reliance on “diverse” providers that ride on the same physical layer undermines true diversity.



For example, operators (such as the largest staking providers) that rely heavily on “big tech” hyperscaler cloud infrastructure (AWS, Google Cloud, Azure, etc.) face centralization, unnecessary third-party risk, and cost management concerns that are only avoided by a handful of specialist bare-metal staking operations such as <a href="https://globalstake.io/">GlobalStake</a>. IBM highlights the security benefits of bare metal solutions in critical applications.2 Bespoke bare metal staking providers run their own infrastructure and control their own networks – purchasing and owning equipment outright, fully controlling and tuning hardware, software, and network routing, and operating through distributed global data centers rather than renting from big tech and third-party suppliers. Pro tip: If your provider says they use bare metal, ask them for specifics. Do they own it?&nbsp; Do they manage it directly? Which networks (or geographies) do they serve with bare metal?



<h2 class="wp-block-heading">Critical Benefits Of Diversification For Institutions</h2>



<h3 class="wp-block-heading">Optimized Returns</h3>



Diversification leverages the strengths of different partners, not only mitigating risks but potentially leading to higher overall returns. CoinDesk&#8217;s annual report emphasizes how performance can vary significantly between providers.3



<h3 class="wp-block-heading">Improved Regulatory Compliance</h3>



Regulatory landscapes are constantly in flux. Diversification helps navigate potential changes that could impact staked assets in specific jurisdictions, as KPMG&#8217;s report on blockchain regulations highlights, reassuring you that your staked assets comply with the latest regulations relevant to local geography.4



<h1 class="wp-block-heading">Multi-Stake: The New Standard for Institutional Staking Resilience</h1>



In the traditional finance sector, hedge funds have adopted a &#8220;multi-prime&#8221; approach—engaging multiple prime brokers—to mitigate counterparty risk, enhance access to diverse services, and optimize operational efficiency.5 The practice became critically necessary after the 2008 financial crisis.&nbsp;



As the cryptocurrency industry matures, institutional investors must adopt a &#8220;multi-stake&#8221; strategy—diversifying their staking activities across multiple providers—to ensure resilience and optimize their participation in the evolving digital asset ecosystem. This approach is critical for several reasons:



<ul class="wp-block-list">
<li>Risk Mitigation: Distributing staked assets among various providers significantly reduces the impact of potential failures or performance issues associated with a single provider.</li>



<li>Service Optimization: Different staking providers offer unique benefits, such as varying fee structures, enhanced security measures, or superior customer support. Engaging multiple providers enables institutions to capitalize on the best aspects of each.</li>



<li>Operational Resilience: A multi-stake approach ensures continuity in staking operations by not relying upon a single entity. This resilience is essential for maintaining consistent rewards and meeting network participation requirements.</li>



<li>Improved Regulatory Compliance: Regulatory landscapes are constantly in flux. Diversification helps navigate potential changes that could impact staked assets in specific jurisdictions, as KPMG&#8217;s report on blockchain regulations highlights, reassuring you that your staked assets comply with the latest regulations relevant to local geography.4</li>
</ul>



By adopting the multi-stake model, institutional crypto holders align with well-established financial practices, ensuring a more secure, efficient, and scalable staking environment as the industry progresses.



<h2 class="wp-block-heading">Choosing The Right Staking Partners: Beyond Diversification</h2>



Once diversification—the most critical foundational staking pillar—becomes a priority for an institution, the other essentials become clear, helping to refine the list of options and choosing the right partners to work with.



Here is how to consider key factors impacting your overall staking strategy:



<h3 class="wp-block-heading">Security of People, Processes, &amp; Technology:&nbsp;</h3>



Ensure your provider follows industry best practices across its enterprise. These include background checks of all employees, creating repeatable and defined processes that remove risks at every turn, and ensuring the technology keeps pace with changes. You should also understand how heavily your provider relies upon outside contractors versus full-time staff.



<h3 class="wp-block-heading">Service, Reporting, Insurance, &amp; Flexibility:&nbsp;</h3>



Far too many staking providers are hidden behind a wall of web applications and automated help desks (if any). Being able to speak with a capable account manager is an important attribute, especially when considering the daily and monthly reporting that institutions must regularly deliver to their management, investors, regulators, and accountants.



Staking providers should be able to provide detailed, tailored reporting on staking activity. Ideally, this should manifest in an offering that provides real-time dashboards, customized reports, and actionable insights into staking performance, helping institutional decision-makers evaluate and refine strategies. While best practices for node management substantially limit the risks of losing digital assets, the most capable providers typically offer slashing insurance from the highest-rated carriers. Finally, flexibility in deployment configurations and the capacity to support bespoke client applications can be a significant value add.



<h3 class="wp-block-heading">Custodial Integrations, Self-Custodial Technology Solutions &amp; Relationships:</h3>



Credible, qualified custodians serve as the foundation of secure institutional staking. Partnering with trusted custodians or leveraging self-custodial technology solutions, such as BitGo—which offers both options—ensures a seamless and secure staking experience. These partnerships enable adherence to best practices and foster trust throughout the staking process. Additionally, many global custodians enhance their offerings by utilizing advanced custodial enablement platforms like Ledger Enterprise, further reinforcing the security and efficiency of institutional staking solutions. As Forbes highlights, the involvement of trusted custodians is essential for meeting stringent security standards and aligning with institutional expectations.6



Equally important is seamless technical integration with institutional-grade custodial platforms. Providers should prioritize compatibility to streamline onboarding processes, minimize operational friction, and enhance the overall user experience for institutional clients. By ensuring a smooth and secure connection between staking services and custodial platforms, providers can better meet the needs of sophisticated investors and solidify their position as trusted partners.



<h3 class="wp-block-heading">New, Old, &amp; Niche Asset Support</h3>



Crypto moves fast. A key distinguishing factor for an institutional staking provider is its ability to swiftly support new tokens. A valuable staking partner will promptly fulfill new token requests and establish deep integrations with emerging protocols. Custodial connectivity empowers institutions to rapidly adapt to market shifts and capitalize on new opportunities without being hindered by technical delays or inflexible integration processes.



For instance, several providers in the industry, like Figment, GlobalStake, Kiln, and others, demonstrate their capability in this area by working directly with protocol teams. This direct involvement enables quick and accurate support for new tokens and unique requirements, ensuring any updates or new features are implemented precisely, thereby reducing the risk of errors that could affect staking outcomes. They also provide dedicated and responsive account personnel who work closely with institutional clients to support new and existing assets, highlighting their commitment as a reliable partner in the rapidly evolving digital asset landscape.



Your best staking partner does more than meet today’s needs – it anticipates tomorrow’s opportunities.



<h3 class="wp-block-heading">Staying at the Cutting Edge of Staking Innovation</h3>



Your best staking partner does more than meet today’s needs – it anticipates tomorrow’s opportunities. A true partner ensures institutions remain at the forefront of staking developments by integrating the latest advancements, such as Liquid Staking Tokens (LSTs) for enhanced liquidity and MEV (Maximal Extractable Value) boosting for optimal returns. Innovations like proof-of-stake mechanisms combined with proof-of-work elements in hybrid protocols and secure storage solutions ensure robust performance and security. Advanced storage protocols, such as decentralized data storage networks, further complement staking by safeguarding validator data and key material with unparalleled redundancy and resilience. From yield enhancements and slashing protection to protocol governance participation and emerging storage innovations, a cutting-edge partner ensures clients capitalize on every advantage the evolving staking ecosystem offers. Is your provider committed to pioneering advancements and driving institutional success?



<h2 class="wp-block-heading">Compliance With Audited Practices:</h2>



For institutions, compliance is non-negotiable.&nbsp;



<h3 class="wp-block-heading">Audited Peace of Mind</h3>



Full SOC 2 Type 2 certification is critical as a starting point, particularly for those operating in the U.S. market. To instill confidence in the rigor of their internal digital asset protections, staking providers must adhere to other recognized standards such as ISO27001 with the absolute requirement to become certified by the Cryptocurrency Security Standard (CCSS) – ensuring safety across crypto-specific processes and technologies, wallets, validators, and key management, et al.



Research by Gallagher highlights the trust and security benefits of SOC 2 compliance for service providers.7 Regular, independent audits are essential to demonstrate a commitment to evolving regulations and ensure transparency and operational reliability. These practices reassure stakeholders that their assets are secure and always managed with the highest integrity.



Operations and technology transparency are paramount. While some node operators rely on proprietary methods, providers offering visibility into their operating procedures and network principles stand out. Opaque, black-box systems do not engender client confidence.



<h3 class="wp-block-heading">Environmental Sustainability</h3>



Beyond compliance and transparency, environmental sustainability has emerged as a valuable bonus, particularly as institutional investor priorities shift toward environmental responsibility. The crypto industry has faced sustainability critiques for over a decade, making it increasingly important for institutions to align with environmentally responsible providers. By integrating sustainability into operations, providers differentiate themselves and help institutions future-proof their strategies in a regulatory environment rapidly evolving toward greener mandates.



<h1 class="wp-block-heading">Here’s How to Build A Resilient Staking Strategy</h1>



Institutions require more than just basic staking services.



A resilient strategy begins with diversification—spreading activity across reputable providers and incorporating self-hosted bare-metal infrastructure to minimize risk and provide physical diversity in addition to provider diversity.



GlobalStake is the premier bare metal institutional staking platform, delivering comprehensive solutions designed with the utmost security, performance, and regulatory compliance in mind. Unlike providers reliant on third-party systems or cloud infrastructure, GlobalStake operates its own globally distributed, bare-metal network. This unique approach fosters true decentralization, enhances control, and mitigates regulatory and cloud-specific vulnerabilities. Backed by SOC 2 Type 2 and CCSS certifications, GlobalStake adheres to the highest operational security standards, providing institutions with the utmost confidence as they stake assets such as $SOL, $ETH, and $DOT. Seamless integrations with leading custodial platforms like Ledger Enterprise, Cobo Custody, and BitGo empower institutions to seamlessly manage their staking operations within their existing, familiar ecosystems.



With a commitment to sustainability and transparency, GlobalStake is a carbon-negative node operator aligning with responsible investment principles. The platform&#8217;s decentralized infrastructure, utilizing diverse hardware, geographies, and networks, minimizes single points of failure, enhancing security and reliability. GlobalStake empowers institutions to optimize staking returns through responsive service, flexible and competitive pricing, robust custodial integrations, tailored cutting-edge staking strategies, and comprehensive insurance coverage provided by top-rated carriers. This comprehensive approach enables institutions to build resilient, long-term solutions for their digital asset management needs.



For our Blockworks readers, discover why institutions like yours trust GlobalStake. To see the difference GlobalStake makes, book a one-on-one consultation with its experts. To request a meeting, <a href="mailto:institutions@globalstake.io">email the institutional partners team </a>at<a href="mailto:institutions@globalstake.io"> institutions@globalstake.io</a>.



GlobalStake delivers institutional-grade staking with self-owned, SOC2-certified bare-metal infrastructure, carbon-negative operations, and comprehensive security. Enjoy competitive pricing, decentralized operations, and slashing insurance backed by top-rated carriers. Learn more at <a href="http://globalstake.io/">globalstake.io</a>.



<h2 class="wp-block-heading">Citations</h2>



<ol class="wp-block-list">
<li>Boston Consulting Group, &#8220;Managing Risk for the Next Wave of Digital Currencies.&#8221; https://www.bcg.com/publications/2023/managing-risk-for-next-wave-of-digital-currencies</li>



<li>IBM, &#8220;Bare Metal Servers vs Virtual Servers.&#8221; <a href="https://www.ibm.com/think/topics/bare-metal-servers-vs-virtual-servers">https://www.ibm.com/think/topics/bare-metal-servers-vs-virtual-servers</a> </li>



<li>CoinDesk, &#8220;Consensus Annual Report 2023.&#8221; </li>



<li>KPMG, &#8220;Crypto and Digital Assets: Regulatory Challenges.&#8221; https://kpmg.com/us/en/articles/2022/ten-key-regulatory-challenges-2022-crypto-digital-assets.html</li>



<li>Merrill Lynch, “The Multi-Prime Broker Environment: Overcoming the Challenges and Reaping the Benefits <a href="https://www.opalesque.com/files/MultiPrimeBrokerEnvironment.pdf">https://www.opalesque.com/files/MultiPrimeBrokerEnvironment.pdf</a></li>



<li>Forbes, &#8220;The Institutional Guide for Securing Digital Assets.&#8221; <a href="https://www.forbes.com/sites/digital-assets/2023/10/30/the-institutional-guide-for-securing-digital-assets/">https://www.forbes.com/sites/digital-assets/2023/10/30/the-institutional-guide-for-securing-digital-assets/</a></li>



<li>Gallagher, &#8220;SOC 2 Type 2 Certification: What it is and Why it matters.&#8221; <a href="https://security.gallagher.com/en/Blog/SOC-2-Type-2-certification-what-it-is-and-why-it-matters">https://security.gallagher.com/en/Blog/SOC-2-Type-2-certification-what-it-is-and-why-it-matters</a> </li>
</ol>



This content is sponsored and does not serve as an endorsement by Blockworks. The veracity of this content has not been verified and should not serve as financial advice. We encourage readers to conduct their own research before making financial decisions.

The Top Five Digital Asset Staking Pillars Institutions Can’t Ignore

Jack Kubinec

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed">subscribe</a>.



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Donald Trump is yet to take office, but the presumed increase in crypto M&amp;A deals under his presidency already appears to be underway.



Crypto on- and off-ramp platform MoonPay has acquired Solana payments startup Helio in an all-equity deal valued at $175 million, Helio CEO Stijn Paumen confirmed today. Paumen added that the entire Helio team will be joining MoonPay. There could be more M&amp;A action on the horizon, especially in the emerging field of crypto payments. Two other founders in the crypto payments space confirmed to me that they’ve seen recent acquisition interest.



MoonPay is a popular service for users trying to purchase crypto using bank accounts, credit cards or PayPal. Helio is more e-commerce focused, most recently making headlines for <a href="https://blockworks.co/news/helio-upgrades-solana-pay-plugin-for-shopify">its Shopify plugin</a> that lets merchants accept payments via the Solana network.&nbsp;



In acquiring Helio, MoonPay is showing an aspiration to expand beyond buying and selling crypto into providing infrastructure for people to pay for goods and services with crypto, Ben Mills, CEO of the on-ramp company Meso, told me. By combining forces, MoonPay is becoming one of the most vaunted outfits in onchain payments, Paumen said.&nbsp;



MoonPay’s Helio deal is one of the crypto sector’s more notable recent acquisitions, joining <a href="https://blockworks.co/news/lightspeed-newsletter-bridge-solana-vc">Stripe’s October purchase</a> of the stablecoin infrastructure company Bridge for a reported $1.1 billion. It feels notable that both of these deals involved crypto payments — which is the technology’s original use case but not one that has caught on very broadly just yet.



Crypto still believes in payments. In Lightspeed’s recent Solana Founders poll, <a href="https://blockworks.co/news/solana-founders-survey-responses">a plurality voted</a> that payments are Solana’s most underrated sector.



Still, how big of a deal this all is remains a matter of perspective. Stripe buying Bridge was a validation for crypto because Stripe isn’t a crypto company, Mills said.



The intra-industry deal of MoonPay buying Helio “feels more like internal consolidation which is probably healthy, but doesn’t tell us much,” he added.



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Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

MoonPay acquires Solana startup to grow payments services

Ben Strack

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance">subscribe</a>.



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After hitting the <a href="https://blockworks.co/news/one-year-since-bitcoin-etf-approval">one-year anniversary</a> of US spot bitcoin ETFs launching, Bloomberg Intelligence’s James Seyffart told me that even the more bullish firms behind these products were surprised by the reception.



Matt Horne, Fidelity Investments’ head of digital asset strategists, confirmed to me as much.&nbsp;



He referenced demand exceeding the company’s “optimistic” expectations across retail investors, advisers and institutions. The Fidelity Wise Origin Bitcoin Fund (FBTC) — with $12.2 billion of net inflows — trails only BlackRock’s iShares Bitcoin Trust (IBIT) in that category ($37.7 billion).



But is the bitcoin ETF market due for a sophomore slump?&nbsp;



Fidelity has so far had “productive conversations” across all client segments when it comes to <a href="https://blockworks.co/news/fidelity-report-stagflation-investors">rising bitcoin ETF usage</a> in 2025, Horne explained.



He also said about the 16-year-old asset: “A longer history will allow for continued portfolio research and a stronger understanding of investors’ risk tolerance and bitcoin’s role in a portfolio.”



Horne mentioned the “adoption spectrum” of various client types. Related, Bitwise CEO Hunter Horsley said during an X space Friday — using terms from Geoffrey Moore’s “Crossing the Chasm” — that we’re stepping out of the early adopter phase and into the “early majority.”&nbsp;



Then, borrowing Winston Churchill’s words to describe bitcoin ETF adoption, Horsley added it feels like we’re at “the end of the beginning.” Exploring bitcoin as an opportunity remains “on the to-do lists” across firms within the $30 trillion <a href="https://blockworks.co/news/financial-advisers-crypto-adoption-survey">US wealth management sector</a>, he noted.&nbsp;



But as Zacks Investment Research’s Neena Mishra told me Friday, whether BTC ETF inflows in 2025 can match/beat last year is likely to hinge on performance.



US bitcoin funds suffered outflows of $569 million and $149 million on Wednesday and Friday, respectively, (markets were closed Thursday to honor Jimmy Carter) amid the BTC price plunge mentioned earlier.&nbsp;&nbsp;



Casey brought up the possible US strategic bitcoin reserve — something Seyffart said would drive ETF demand. But a BTC pullback (and outflows) could come if Trump and the pro-crypto Congress fail to execute on crypto-related promises.



“Though as more traditional investors use these ETFs, they will likely be a support on bitcoin&#8217;s price as they rebalance in downtrends by buying more,” Seyffart said. “Conversely, they will also likely be sellers in uptrends as they rebalance to their target allocation levels over the longer term.”



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

Bitcoin ETFs: Better year or sophomore slump?

Casey Wagner

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance">subscribe</a>.



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Back in July, President-elect Donald Trump floated the idea of a strategic bitcoin reserve.&nbsp;



“As you know, most of the bitcoin currently held by the United States government was obtained through law enforcement action,” Trump said during a <a href="https://blockworks.co/news/donald-trump-speaks-bitcoin-2024">campaign stop</a> at the Bitcoin 2024 Conference <a href="https://blockworks.co/news/bitcoin-2024-nashville-recap">in Nashville</a>. “You know that they took it from you.”&nbsp;



“[We will] keep 100% of all bitcoin the US government currently holds or acquires” in a “stockpile,” he added.&nbsp;



After Trump left the stage, Wyoming US Senator and long-time crypto advocate <a href="https://blockworks.co/news/senator-lummis-bitcoin-reserve-bill-crypto-policy">Cynthia Lummis</a> appeared, wielding a stack of papers.&nbsp;



“Here it is,” she said, holding up the bundle. “This is the Bitcoin Reserve Bill.”&nbsp;



The crowd, waiting in their MAGA gear and “Make Bitcoin Great Again” hats for hours to see Trump and Lummis, cheered.&nbsp;



Lummis brought the bill to the Senate floor at the end of July, but it didn’t budge. Now, as we kick off a new congressional term, Lummis is expected to revive the legislation — ideally with a co-sponsor or two this time around.&nbsp;



The <a href="https://blockworks.co/news/bitcoin-as-a-potential-us-reserve-asset">bitcoin reserve</a> has become one of the more <a href="https://blockworks.co/news/revisiting-trumps-crypto-promises-after-his-election-win">talked-about promises</a> Trump has made to the crypto industry. Other pledges made on the campaign trail have either become moot or are too subjective to assess.&nbsp;



For example, Trump vowed to fire “Gary Gensler on day one,” an executive action that legal experts doubted he could even do. It doesn’t matter anyway, because the SEC chair has already <a href="https://blockworks.co/news/gary-gensler-resigning">announced his resignation</a>.&nbsp;



Trump also has sworn that his “digital asset advisory council,” to be <a href="https://blockworks.co/news/trump-picks-crypto-czar">led by David Sacks</a>, will create a “fair regulatory regime.” We’ll leave it to his numerous crypto donors to settle on a definition of “fair.”&nbsp;



But the bitcoin reserve, and whether or not it comes to fruition, is something we can quantify.&nbsp;



I’m a little uncertain about just how much the industry cares about the US government holding bitcoin. I’d imagine there are some exchanges and custodians itching to get their hands on what will no doubt be a lucrative government contract. Plus, the existence of a stockpile would position the US as more crypto-friendly, which the industry, of course, wouldn’t mind. A rising tide floats all boats.&nbsp;



I’m still skeptical that there’s enough political capital behind the reserve bill for it to move out of committee, assuming Lummis does in fact reintroduce it. Hill staffers and lobbyists I talk to tend to mention legislation around market structure (<a href="https://blockworks.co/news/house-passes-act-fit21-with-bipartisan-support">à la FIT21</a>) and <a href="https://blockworks.co/news/crypto-new-age-in-2025">stablecoins</a> far more often.&nbsp;



Plus, the Senate is going to be swamped with confirmation hearings in the coming weeks and months, and Republicans have laid out a big —&nbsp;and likely expensive — agenda on taxes, immigration and more.&nbsp;



A fun test for how likely a strategic reserve is will be whether or not the DOJ auctions off around $6.5 billion worth of bitcoin that it recently received the <a href="https://blockworks.co/news/us-gov-unloading-bitcoin-process">greenlight to sell</a>.&nbsp;



The court ruling allowing the auction (but not requiring it) came at the end of 2024, so we’ll see if the US Marshals Service undertakes a sale before Trump takes office next week.



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Tis the season for campaign promises follow-throughs

Donovan Choy

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/research">subscribe</a>.



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If you count the <a href="https://blockworks.co/news/0xresearch-newsletter-goatse-memecoin">launch of GOAT</a> as the birthdate of the AI agent meta, then this subsector is about three months old. Over this short span, the AI agent market has ballooned to a $20 billion market cap with relatively few tier-1 CEX listings.



That’s nuts, especially since AI agents are still <a href="https://blockworks.co/news/ai-agents-are-not-agentic">predicated on</a> promised — rather than current — utility.



It’s perhaps unsurprising then that the agent market corrected sharply over the weekend, showing a 43.5% drawdown to $11.3 billion since its Jan. 6 top.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfe8RiIhVW1_nZIQYCfxu5H3PhPm3UI4rwHXPw5Yyu3MIqfeTAi3CVAHUJ0PE3SrzCPt-sWWD-FBY-vgNnCw-bdMo9R-IGI3Mh_PTKFkpGyEoNwQ5TXr1m6t13kAniZgqoOZ3XGQA?key=CDTzgM_SYicJk8C4XXfNtdbE" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://www.cookie.fun/">cookie.fun</a></figcaption></figure>



The top AI agent tokens haven’t been spared the guillotine. In the last seven days, the largest three AI agent tokens by marketcap — VIRTUAL, AI16Z and FARTCOIN, are down 46%, 52%, and 42%, respectively.



AIXBT, the fifth-largest agent token, showed the greatest resilience, with a drawdown of 28%.



It’s a bloodbath. So what? Expect agents to continue <a href="https://blockworks.co/news/ai-crypto-vs-dotcom-bubble">dominating 2025</a>.



Crypto’s obsession with AI is undeniable at this point. It’s riding the hottest tech sector of the decade and still dominates Twitter sentiment among rabid casino speculators.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeeqcz7QAWEz9rxdTyn6byV0SZmptA3t1yRijIq-2NsaprPHUvd11nNjcsGFjmOOVQwn86HwqERLfMAIZcfbNnSBAIzcxEQ6lydwcyn9WOthwEa1PIkFA44bilxYLW-aleNJbkK?key=CDTzgM_SYicJk8C4XXfNtdbE" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://x.com/_kaitoai/status/1877695766594011402">Kaito</a></figcaption></figure>



The billion dollar question then is: How high can the AI agent market go?



At $11.3 billion, AI agent tokens make up about 0.34% of the total crypto market cap today.



If we assume a 40% growth of the total crypto market cap to $5 trillion, and AI coins take a 5% slice of that pie (DeFi dominance peaked at <a href="https://www.tradingview.com/symbols/TOTALDEFI.D/">7.69%</a> in 2022), then you can expect $250 billion as a bull case, says <a href="https://kelxyz.substack.com/p/letters-3-the-case-for-agent-networks">kel.xyz</a>.



Less bullish estimates by <a href="https://x.com/davidnage/status/1878442581794668769?s=46&amp;t=ywALktyM5ZCyt-zigN5Big">David Nage</a> of Arca fund projects a range of $93 billion to $170 billion.



With this framework in mind, the “safe” bet is to hold the ecosystem majors of the AI meta: VIRTUAL, AI16Z and ZEREBRO… right?



The problem is these inter-narratives rotate faster than anyone can keep up with. There’s hardly any guarantee that the “blue chip” agent coins today maintain their dominance over months, or even weeks from now.



In the span of a year, the story of “why AI crypto” went from a beta play on Nvidia and OpenAI to AI memecoins, to AI agents, to AI agent frameworks, AI investment DAOs and AI agent <a href="https://www.blocmates.com/articles/what-are-ai-agent-swarms---the-next-chapter-in-ai-agent-evolution">swarms</a>.



As of last week, the most recent chapter in this tale is “<a href="https://x.com/0xNairolf/status/1878766177784418641">DeFAI</a>,” i.e., DeFi + AI. I interpret this as an insistence that “AI has real utility, look to its DeFi use cases!”



I’m reminded of a tweet from Daily Ape’s founder Darren Lau. If you’d made the bold bet that AI would sweep crypto markets and scoop up a bag of major AI tokens like TAO, RNDR and AKASH in early 2024, you’d still be sitting on a loss year to date.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">imagine you decided AI was gonna be THE narrative Jan-March 2024 when AI started pumping, you thought ok nice i&#39;ll just buy the majors of AI for this cycle TAO: average buy 450$ (January-March 2024 period average) -&gt; Break-even Dec 2024 FET: avg buy 1.6$ -&gt; down 20% Dec 2024…&mdash; Darren Lau (@Darrenlautf) <a href="https://twitter.com/Darrenlautf/status/1870556657509650809?ref_src=twsrc%5Etfw">December 21, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Winning at the AI agent meta then requires one to pick the right players in an ever-changing playbook of questionable utility. Is it any wonder crypto traders get rekt?



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AI agent sector suffers 44% market cap wipeout

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire">subscribe</a>.



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Binance has barely skipped a beat since CZ stepped down.



And it’s not like the odds aren’t stacked against it — even to the point that much of the world outside crypto has been outright hostile to it.



The past few years have seen rolling bans and other jurisdictional roadblocks across parts of <a href="https://www.reuters.com/technology/crypto-exchange-binance-stop-accepting-new-users-uk-2023-10-16/">Europe</a>, <a href="https://www.kapronasia.com/blockchain-research-menu-item/despite-binance-ban-crypto-demand-is-resilient-in-the-philippines.html">Asia</a> and Africa. That includes a grueling <a href="https://blockworks.co/news/nigeria-drops-charges-against-binance-exec">eight-month ordeal</a> in Nigerian jail for Tigran Gambaryan, Binance’s head of financial crime compliance who’d been arrested on spurious money laundering charges.



Then there’s increasing competition within the crypto space. Rival offshore crypto exchanges including Bybit, Bitget and Gate.io have all grown their footprints to fill parts of the sizable gap left by FTX.



Still, Binance persists as the number one venue by trade volume. CoinGecko <a href="https://www.coingecko.com/en/exchanges">points</a> to $9 billion in normalized daily volume on Binance right now. Bybit is a distant second with $3 billion, followed by Coinbase with $2.6 billion.



Binance’s ability to serve memecoin traders what they want seems to be its key to success — at least at this part of the cycle.



In fact, Binance has effectively cornered the memecoin game: Kaiko in December <a href="https://research.kaiko.com/reports/quarterly-report-q4-2024">calculated</a> that the exchange was controlling 44% of memecoin volume on CEXs.



Empire’s Jason Yanowitz brought some of this up with new(ish) CEO Richard Teng on today’s podcast episode:



“I thought you guys would have to stop doing a lot of the things [Binance did] to get to the place it got to: Listing things early, getting out to new markets early,” Yanowitz said.



“But you guys are still listing a lot of memecoins. You’re still very early to listings. You have new Launchpool projects in the last couple of months — Binance has given users a lot more trading opportunities. It kind of goes against what I thought would happen.”



One <a href="https://dune.com/oladee/binance-2024-listing">dashboard</a> tracking new tokens listed on Binance in 2024 lists 37 coins, nine of which are memes including HMSTR, BABYDOGE, TURBO and DOGS. The platform also recently <a href="https://www.binance.com/en/support/announcement/binance-futures-will-launch-usd%E2%93%A2-margined-griffainusdt-ai16zusdt-and-zerebrousdt-perpetual-contracts-with-up-to-75x-leverage-2e58ae9924344fbf878fcd559bfdec81">added</a> perps for AI coins — next-gen memecoins — AI16Z, ZEREBRO and GRIFFAIN with up to 75x leverage.



Teng responded by stating that Binance lists fewer coins compared to many of its competitors, itself a function of the listing processes that protect the interest of its users.



“If you look at the number of coins that we list, it’s around 600. We are very, very stringent with the coin selection process on that front. We have published the listing criteria and we ringfence the listing team so much that we give them the time and space to do their independent due diligence.”



Co-host Santiago Santos then probed for an answer on listing fees — one of the last great lucrative aspects of crypto exchanges still opaque to outsiders.



“[Binance’s] distribution is unparalleled — when you think about the overall fees [for Launchpad listings], is it like a dollar amount or a notional amount — is it a token supply amount, and if so, I’m curious how that has evolved over time,” Santos said.



Teng declined to comment by saying that those details were very specific. Better luck next time, I guess.



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Binance hasn’t slowed since CZ — neither have the memecoin launches

Katherine Ross

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire">subscribe</a>.



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The crypto credit market hasn’t quite recovered since 2022, when we saw the downfall of most of the major players.



Honestly, perhaps that’s been for the best given how much damage was done.



But it’s not an area of crypto that we can expect to stay dormant, especially if crypto’s truly set for another golden year (or even four).&nbsp;



Clearly, a lot of changes will have to take place. And there’ll have to be far more transparency.&nbsp;



Data platform Accountable, which operates in the undercollaterized crypto credit space, is taking steps to perhaps be one of the first successful lending firms post-2022.&nbsp;



The “main value capture is being able to prove, without any API key sharing, any wallet sharing, what&#8217;s happening in the centralized venue — such as banks, brokerage accounts, exchanges, custodians — that the lenders or any other user can basically prove I&#8217;m financially healthy, I&#8217;m operating as intended,” Accountable CEO Wojtek Pawlowski told me.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Accountable Secures $2.3M Funding to Enhance Transparency in Crypto Lending and DeFi Platforms. With the power of zero-knowledge proofs, we’re solving the balance between privacy and transparency in the lending markets.🌐 🔒 Restore trust with real-time, verifiable financial… <a href="https://t.co/F8ZIhUugkL">pic.twitter.com/F8ZIhUugkL</a>&mdash; Accountable (@AccountableData) <a href="https://twitter.com/AccountableData/status/1874101889983234357?ref_src=twsrc%5Etfw">December 31, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">Accountable recently closed a $2.3 million seed round</figcaption></figure>



“The goal of Accountable one day is to become the new Celsius,” Pawlowski said. Without all of the fraud and bad actors, of course. Pawlowski hopes to grow his company to be a “digital finance platform” that could open up yield-bearing opportunities for users.



I’ll admit that, in my conversation with Pawlowski, I expressed skepticism about retail being willing to come back to lenders after being burned.



Pawlowski thinks that, like any other cycle, we’ll see the appetite return as transparency challenges are mitigated. They’re already working with firms like Galaxy and Amber Group.



He also noted that the human brain moves past financial losses after two or three years. If that’s true, perhaps now’s indeed the time to strike while the iron is hot.



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Accountable aims to be ‘the new Celsius’

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Toronto-based Cypherpunk Holdings <a href="https://blockworks.co/news/lightspeed-newsletter-sol-strategies-rebrand">rebranded as Sol Strategies</a> and announced it would be accumulating Solana three months ago. It’s gotten busy since then.&nbsp;



The holding company has acquired two separate validator operations, accumulated over 142,000 SOL worth roughly $27 million at current prices, hired Kraken’s former senior director of engineering to be its head of staking, and applied to be listed on the Nasdaq. Just this week, it signed a credit facility with its board chair to buy $17.3 million worth of SOL tokens and announced a private placement deal with ParaFi Capital worth roughly $19 million.



MicroStrategy CEO Michael Saylor is fond of saying that “there is no second best” crypto behind bitcoin. If there is a second-best version of MicroStrategy’s corporate <a href="https://blockworks.co/news/microstrategy-btc-purchase-recap">crypto purchasing playbook</a>, it just might be the one Sol Strategies is running.&nbsp;



Like Saylor’s firm, Sol Strategies is focused on acquiring crypto as a treasury asset. The difference, CEO <a href="https://www.youtube.com/watch?v=GyWjoGcaeO0">Leah Wald</a> told me, is that Sol Strategies also runs a validator business and invests in Solana ecosystem projects, making its approach “more dynamic.”



Following Sol Strategies’ two validator acquisitions, it now is responsible for a combined 1.5 million staked SOL, which makes it roughly the 65th largest Solana validator. Wald declined to say which ecosystem projects Sol Strategies has taken positions in, if any.&nbsp;



Wald came to Cypherpunk Holdings in July 2024 after a four-year run at the helm of US-based crypto management firm Valkyrie, which had its ETF business <a href="https://blockworks.co/news/coinshares-buys-valkyrie-fund-business">acquired by CoinShares</a> in March. Wald had been a board member at Cypherpunk since October 2021.



Charged with taking over a company that had seen its stock trade sideways for years, Wald — who was among the first to file for and issue <a href="https://blockworks.co/news/valkyrie-plots-bitcoin-futures-etf">bitcoin futures ETFs</a> — saw a new opportunity. <a href="https://blockworks.co/news/lightspeed-newsletter-solana-bull-run">Solana was hot</a>, but it lacked ETFs that investors could trade on traditional stock exchanges. So far, the SOL strategy appears to be working out.&nbsp;



Since debuting as Sol Strategies in September, the company’s stock price is up more than 1,700% — and that’s while a Nasdaq listing is still pending approval.



There’s probably a storm approaching Sol Strategies’ parade in the form of Solana ETFs. Currently, Sol Strategies is one of just a <a href="https://www.thenew.money/trend/solana-holders">few</a> publicly-traded companies giving investors <a href="https://blockworks.co/news/bitwise-ceo-solana-ncredible-emerging-asset">regulated exposure</a> to Solana’s price action by virtue of holding the asset in its treasury.&nbsp;



If Solana ETFs get approved, the market would gain competitors offering a similar service (although whether or not those ETF <a href="https://blockworks.co/news/grayscale-sol-etf-filing">issuers include staking rewards</a> will be key to watch). Sol Strategies will hope the market treats it like a bitcoin mining stock in that case.



But for now, Wald and Sol Strategies’ big bet is paying big dividends.



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Meet Sol Strategies: The MicroStrategy of Solana

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Investors learned one year ago today that US spot bitcoin ETFs finally had the <a href="https://blockworks.co/news/sec-approves-bitcoin-etf">go-ahead to launch</a>, with those products hitting the market the following day.&nbsp;



We now have 12 months of data to look back on.



It was fun reading <a href="https://blockworks.co/news/how-we-got-here-bitcoin-etf">my piece published</a> the morning of Jan. 10, 2024, which recapped <a href="https://blockworks.co/news/spot-bitcoin-etf-timeline">what led to </a>that milestone.



The Winklevoss twins filing for a bitcoin ETF in 2013; BTC futures funds hitting the US market in 2021; the SEC <a href="https://blockworks.co/news/grayscale-sues-sec-over-rejection-of-proposed-spot-bitcoin-etf">blocking Grayscale’s GBTC conversion</a> the following year — and the firm then <a href="https://blockworks.co/news/grayscale-faces-uphill-battle-with-lawsuit-against-sec">suing the regulator</a>; <a href="https://blockworks.co/news/blackrock-files-bitcoin-etf">BlackRock’s head-turning proposal</a> in mid-2023; and, finally, <a href="https://blockworks.co/news/sec-grayscale-spot-bitcoin-etf">Grayscale’s legal win</a>.&nbsp;



Predictions seeking to quantify the demand for these then proliferated, with many expecting the bitcoin ETFs to <a href="https://blockworks.co/news/analysts-take-on-bitcoin-etf">shatter records</a>.&nbsp;



Spoiler: They did.



Bloomberg Intelligence analyst James Seyffart reflected on his $15 billion year-one net inflow expectation from a year ago. These were higher expectations than most in the TradFi research world, he told me. Yet lower than some projections from those in the crypto space.



“Still, even issuers who expected these to be blockbuster hits did not expect them to do this well,” Seyffart told me. “They now hold over 1.13 million bitcoin and have $100 billion in assets after taking in almost $38 billion of net inflows in their first year — more than double what we thought would have been a very successful launch.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Just how big was the first year for Bitcoin ETFs? MASSIVE Here&#39;s a list of the largest ETFs 1 year after they launched. Even if you inflation adjust the assets, 4 of the Bitcoin ETFs are in the top 20 US ETF launches of all time. <a href="https://twitter.com/search?q=%24IBIT&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$IBIT</a>, <a href="https://twitter.com/search?q=%24FBTC&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$FBTC</a>, <a href="https://twitter.com/search?q=%24ARKB&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$ARKB</a>, and <a href="https://twitter.com/search?q=%24BITB&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$BITB</a> <a href="https://t.co/MQuf6wp9Fe">pic.twitter.com/MQuf6wp9Fe</a>&mdash; James Seyffart (@JSeyff) <a href="https://twitter.com/JSeyff/status/1877755409571684399?ref_src=twsrc%5Etfw">January 10, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



In its 2025 outlook <a href="https://bitwiseinvestments.com/crypto-market-insights/the-year-ahead-10-crypto-predictions-for-2025">report</a>, Bitwise argued that bitcoin ETFs will <a href="https://blockworks.co/news/11-facts-about-bitcoin-etfs-since-launch">attract more flows</a> in 2025 than they did in 2024.&nbsp;



Others have a bit more of a nuanced perspective.



Seyffart noted that after the products welcomed roughly $16 billion in assets during Q4 alone, another $15 billion inflow year (matching his initial year-one prediction) seems like “a foregone conclusion assuming the economy avoids a recession.”&nbsp;



Though he didn’t share a precise 2025 inflow projection, Seyffart believes bitcoin ETFs will grow to triple the size of gold ETFs within the next three to five years.&nbsp;



The biggest bitcoin ETF — BlackRock’s iShares Bitcoin Trust (IBIT) — has well surpassed its iShares Gold Trust (IAU) in AUM — ~$52 billion to ~$33 billion. IBIT is still chasing the category-leading SPDR Gold Shares (GLD), which manages roughly $74 billion.



Seyffart highlighted bitcoin’s various use cases: a hedge against currency debasement, as well as a form of “hot sauce and satellite positions” in a portfolio given the asset’s volatility.&nbsp;



He and Neena Mishra, director of ETF research at Zacks Investment Research, also pointed out more wirehouses greenlighting bitcoin ETFs in 2025 as a potential catalyst. Remember <a href="https://blockworks.co/news/on-the-margin-newsletter-morgan-stanley-bitcoin-adoption">Morgan Stanley’s move</a> in August?&nbsp;



Meanwhile, BlackRock and Fidelity — as powerhouses in the asset management industry — are set to continue <a href="https://blockworks.co/news/2025-btc-adoption-wave">“legitimizing” bitcoin</a>, which cannot be overlooked, Mishra added.



“However, much will depend on bitcoin’s performance, as ETF flows tend to follow performance trends,” she said.



Alongside macro factors, set to be a major factor on BTC price in 2025 is whether (and how quickly) the promise of <a href="https://blockworks.co/news/financial-advisers-crypto-adoption-survey">crypto regulatory progress</a> is fulfilled.



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Looking back (and ahead) a year after bitcoin ETF approval

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It’s US Employment Report Day! December’s figures came in much stronger than expected.&nbsp;



Nonfarm payrolls grew by 256,000 and blew past analysts’ forecast of 155,000 — significantly higher than November’s 212,000 positions added. The unemployment rate edged down just slightly, coming in at 4.1% vs. the expected 4.2%.&nbsp;



There is such a thing as a too hot report, though.&nbsp;



“There is a growing worry on Wall Street that inflation is making a comeback. While a strong labor market is good for the US, there are worries that too strong of a jobs market will put reflation back on the table,” said Bret Kenwell, US investment analyst at eToro.&nbsp;



The odds of an interest rate cut later this month are all but <a href="https://blockworks.co/news/rate-cutting-cycle-2025">out the window</a>, and chances central bankers opt to lower fed funds in March or even May aren’t looking great, either.&nbsp;



US equities, after a decent start to the new year, are now solidly in the red for 2025 — likely an impact of diminished rate cut expectations and growing concern that the devastating fires in Los Angeles will come with significant financial consequences.&nbsp;



Still, a resilient labor market and economic growth — which, according to the data, is where we currently stand — isn’t bad for stocks, according to Jessica Rabe, co-founder of DataTrek Research.&nbsp;



The employment situation bodes well for corporate profitability.



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Hot employment report leads stocks lower, at least for now 

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/research">subscribe</a>.



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Usual protocol, the shiny new stablecoin on the block, is seeing its USD0++ “stablecoin” (a popular misconception) lose parity with USD0 as of 17 hours ago. It’s now trading at about $0.92.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfJKaQKd3LoR_qlDnq3oXrZuqX6Ishhb91wcSCpb7S3iQV9m_xwHpyQ-IMUbECGXDxj8xCPEI_7iAags70n37IAM3XYVT2zAoyZq6xDVLOvSAgTEwYEtNIrrRjn-eS8YrPCxAH3?key=fEg0kkmvv4f0yuzriG_37lI3" alt=""/></figure>



But of course, USD0++ is not a stablecoin. It’s a liquid staking derivative of the USD0 stablecoin, somewhat like Lido’s stETH compared to ETH. (The USD peg of USD0 is fine, and the underlying T-bills have no backing issue.)



Usual’s business model is based on the idea of an “onchain Tether” that rewards users. By staking USD0 for USD0++, you receive the underlying T-bill yields and rewards in the protocol’s native token, USUAL.&nbsp;



Should USD0++ stakers change their minds before maturity, they can exit by forgoing rewards and unstake back to USD0 at a 1:1 exchange rate. This first exit option will be available as of <a href="https://usual.money/blog/usual-s-next-leap-solidifying-a-4-year-horizon-for-sustainable-growth">next week</a>.



This explains why the “depeg” between USD0 and USD0++ isn’t exactly a flaw. Think of USD0++ as a bond with four-year maturity. That bond should technically be trading at a discounted rate to reflect a risk premium for holding it for four years. Economists call that the “time value of money.”



Recall that in June 2022, Lido’s stETH too, <a href="https://x.com/unusual_whales/status/1535336025362288641">depegged</a> from ETH amid financial troubles around the <a href="https://blockworks.co/news/bankrupt-celsius-estate-bitcoin-mining">now-defunct Celsius</a>.



Market panic led to LPs pulling stETH liquidity from Curve pools, causing massive <a href="https://blockworks.co/news/curve-egorov-exit-defi-positions">liquidity imbalances</a> and a stETH:ETH depeg. Just like stETH does not necessarily have to trade at parity with ETH, USD0++ does not have to trade at parity with USD0.



What’s causing the USD0++ haircut today, however, is Usual’s announcement of an alternative USD0++-to-USD0 exit option. The feature was noted in a blog post <a href="https://usual.money/blog/usual-s-next-leap-solidifying-a-4-year-horizon-for-sustainable-growth">published</a> yesterday.



Based on updated <a href="https://docs.usual.money/usual-products/usd0-liquid-staking-token/usd0++-floor-price">docs</a>, the new exit option would allow users to redeem USD0++ to USD0 at a manually set floor price of 0.87 USD0 per USD0++, while retaining rewards in USUAL emissions (unlike the original 1:1 exit option).



Why $0.87? Because it’s the discounted rate at fair value. As Treehouse Finance’s <a href="https://x.com/mytwogweis/status/1877595190640488708">@mytwogweis</a> explains:



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
If you expect 4% annually over four years, the fair value of USD0++ today should be around $0.855. This means you’d buy it at $0.855, hold it for four years, and redeem it at $1 for a risk-free 4% return.
</blockquote>



To put it simply, the new exit option more accurately reflects USD0++ for what it is: a long-term bond.



The problem is that Usual’s go-to-market strategy had already been built on different premises.&nbsp;



Pendle PT-USD0++ farmers who entered into fixed yield trades are now suddenly finding they’ve “overpaid” for a bond at face value (on maturity, 1 PT USD0++ is equal to 1 USD0++).



The USD0++ Pendle pool (with a maturity date of Jan. 30, 2025), for instance, is seeing a dump.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcfAIEZnWVNooHwDCbC1GdokEYZn5aL7OmGp_N9NnZVBnJGBGZruoL0dreDj9MYgXC9Qh784D0YyybLqgmzOmk_fwQKzJctERM-46762x9iD-b4uCUbJCqpbb4KoL4683fXh7gkcg?key=fEg0kkmvv4f0yuzriG_37lI3" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://app.pendle.finance/trade/markets/0x64506968e80c9ed07bff60c8d9d57474effff2c9/swap?view=pt&amp;chain=ethereum&amp;chart=price">Pendle</a></figcaption></figure>



To make matters worse, vault curators on Morpho lending markets have <a href="https://docs.morpho.org/interface/warnings/#what-are-the-warnings-on-the-morpho-interface">hardcoded</a> the prices in USD0++:USDC markets at a 1:1 parity, rather than basing assets on a free floating market rate.



The result: Risk curator Gauntlet and other LPs promptly reallocated vault supply liquidity in USD0++ out of Morpho vaults above the current market rate of $0.91 ahead of the news, prompting public rumors of insider trading.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Gauntlet withdrew ~$43m from usd0++ markets just before the drama started gg nerd + RIP bozo + suck on deez immutable nuts + thanks for playing <a href="https://t.co/iwb6z8tOaH">https://t.co/iwb6z8tOaH</a> <a href="https://t.co/K1RePomus9">pic.twitter.com/K1RePomus9</a>&mdash; DMH 🦇🔊🌊 (@DeFi_Made_Here) <a href="https://twitter.com/DeFi_Made_Here/status/1877693824790622480?ref_src=twsrc%5Etfw">January 10, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



In an email to Blockworks, Tarun Chitra, founder and CEO of Gauntlet, said of the firm’s activity: “We were not privy to any advance notice, however, as the timestamp of these transactions show (the Usual team updated their docs on redemption before this). We were focused on making sure our users weren’t exposed, and we automatically rebalance out of markets when either risk or concentration limits are breached.”



MEV Capital has released a <a href="https://x.com/MEVCapital/status/1877699650783687078">public statement</a> denying it received any insider information from Usual, although it does not say who the firm received the information from.



USUAL, the protocol’s native token, has unwound -18.7% over the last 24 hours, as of 11:45 am ET.



Macauley Peterson contributed reporting.



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Usual protocol’s depeg spurs instability in DeFi markets

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Don’t panic.&nbsp;



That’s the <a href="https://blockworks.co/podcast/empire/55f5d904-ced5-11ef-ac06-576c7c9a1fcd">gist of the message</a> from Asset Reality’s Aidan Larkin on this week’s Empire Roundup. Jason Yanowitz and Santiago Santos specifically asked him about all that US government bitcoin.



Basically, the recent court approval is par for the course for any civil forfeiture. And, no, it doesn’t mean that the US is immediately hitting the sell button.



 ”There&#8217;s a very strict process that has to get followed,” Larkin said.&nbsp;



“ At some point in the future, it&#8217;ll just go through the normal government processes. There will be a civil forfeiture application hearing. They will get their green light and then it will fall into the normal Marshals process and public domain,” he added. Asset Reality (which is a firm both Santos and Yanowitz invested in) helps governments manage seized assets, so Larkin is not just some armchair expert.&nbsp;



From here, we’ll eventually see Coinbase move the bitcoin onchain before it’s sold off.&nbsp;



Blaming the price action on the possibility of trying to time when the gov is going to sell some of its stash isn’t the right move, Larkin said. Instead, when you see that type of selling pressure, then it’s more than likely due to folks speculating and selling themselves.&nbsp;



And now you know.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">The US Govt has been given the greenlight to liquidate 69,000 BTC ($6.5B) from Silk Road, an official confirmed to DB News today Interesting situation less than 2 weeks away from the new admin who vowed to not sell <a href="https://t.co/HqD1KnhJK3">https://t.co/HqD1KnhJK3</a> <a href="https://t.co/xn8ATSEL7H">pic.twitter.com/xn8ATSEL7H</a>&mdash; db (@tier10k) <a href="https://twitter.com/tier10k/status/1877176406905356670?ref_src=twsrc%5Etfw">January 9, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



So how did we get here? Well, a Nevada company called Battle Born Investments initially sought to prevent the US from offloading the bitcoin. However, a judge in California overruled their motion earlier this week, which allows the US to move on with the civil forfeiture, as Larkin noted.&nbsp;



The likelihood of the bitcoin in question being funneled into a potential bitcoin strategic reserve is not very high either, so don’t get your hopes up.&nbsp;



(ICYMI: This summer, Trump <a href="https://blockworks.co/news/revisiting-trumps-crypto-promises-after-his-election-win">said</a> he planned to make it so that the US holds all its current bitcoin and uses it as a strategic reserve.)



To sum it up: Any bitcoin to be sold must first go through older processes. We’re talking pre-crypto processes designed for seized assets such as gold.&nbsp;



Then, there could be a slew of agreements to be made, from using the generated funds to make victims whole to asset sharing agreements with other governments. It’s pretty complicated.&nbsp;



Besides, as Larkin noted, would the US really want to use bitcoin linked to crimes for its reserve stash? Seems unlikely.



When dealing with the government, always assume there’s going to be a lot of bureaucratic red tape. What seems cut and dry probably isn’t.&nbsp;



Instead, Yanowitz thinks we could see — if we get a reserve, mind you — the government buying up bitcoin mined on US soil to stash away. And, honestly, that sounds a lot more interesting than bitcoin simply linked to Silk Road.



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US gov has to follow a ‘strict process’ before unloading $6.5B of bitcoin

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On Tuesday, <a href="https://blockworks.co/news/backpack-wallet-acquires-ftx-eu">we reported</a> that Backpack had purchased FTX EU in a $32.7 million deal. The next day, FTX put out a <a href="https://www.prnewswire.com/news-releases/ftx-clarifies-certain-statements-by-backpack-regarding-backpacks-purported-acquisition-of-ftx-eu-302346394.html">statement</a> clarifying Backpack’s announcement. Then in a press release of its <a href="https://www.prnewswire.com/news-releases/backpack-responds-to-ftx-statement-302346689.html">own</a>, Backpack clarified FTX’s clarification.&nbsp;



This is how companies fight, I guess.&nbsp;



Here’s the crux of it all: What’s left of FTX said it wasn’t aware that Backpack bought FTX EU, and it swore off responsibility for the repayment of FTX EU customers and said it can&#8217;t verify whether what Backpack is saying is true. Backpack responded by saying that much of the saga leading up to its FTX EU acquisition had already been reported, and it would be renaming FTX EU to Backpack EU before it begins doling out customer claims.



The dueling press releases seem to stem from some bad blood FTX still has with FTX EU. FTX <a href="https://www.reuters.com/legal/litigation/ftx-reaches-33-million-settlement-over-failed-european-expansion-2024-02-23/">sued</a> its European arm to try and claw back some of the $323 million Sam Bankman-Fried spent for the startup. The suit ended in a settlement whereby FTX EU’s original founders Patrick Gruhn and Robin Matzke bought back FTX EU for $32.7 million. Backpack then bought FTX EU from Gruhn and Matzke, and the ownership shares are apparently awaiting transfer.



Backpack failed to elucidate this whole chain of events in its original press <a href="https://www.prnewswire.com/news-releases/backpack-announces-acquisition-of-ftx-eu-expands-crypto-trading-across-europe-302342778.html">release</a>, but it also doesn’t materially change much. Whether Backpack bought FTX EU from FTX or from the people who bought it from FTX, the basic fact remains that Backpack owns the asset.



Still, the sale itself remains a bit weird, at least to my mind. Backpack told me it bought FTX EU in April 2024 for $32.7 million. That’s just a month or two after FTX EU’s founders bought the company back for that exact price as part of a lawsuit settlement. At the time, FTX <a href="https://www.reuters.com/legal/litigation/ftx-reaches-33-million-settlement-over-failed-european-expansion-2024-02-23/">reportedly</a> concluded that “no other buyer would agree to purchase” FTX EU.&nbsp;



It doesn’t seem very business savvy for Backpack to pay the full $32.7 million for an exchange that no one else apparently wanted — and which was sold in a court settlement. Couldn’t they have asked for a few million off the sticker price just for getting it off Gruhn and Matzke’s hands? It’s also just a large amount for a startup like Backpack to pay: The project <a href="https://www.coindesk.com/business/2024/02/28/solana-veterans-raise-17m-for-backpack-crypto-wallet-exchange">reportedly</a> lost much of its funding in the FTX collapse, and it only raised $17 million in its last funding round. Where did it get $32.7 million to spend on FTX EU? Backpack did not return my request for comment on the financial side of the deal.&nbsp;



In any event, FTX seems to be nitpicking the Backpack press release, the broad strokes of which don’t appear to warrant much doubt. But we’re talking about FTX here, so it just makes sense things wouldn’t go as smoothly as planned.



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FTX didn’t know Backpack bought its EU arm

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After witnessing the post-election rise in crypto asset prices and ETF flows, here’s another data point backing up a sentiment shift: 56% of 430 <a href="https://blockworks.co/news/financial-advisers-evaluate-etf-approval">surveyed financial advisers</a> say they’re more likely to allocate to the space because of the November results.&nbsp;



This number came from the Bitwise/VettaFi report we referenced a couple times this week as the companies teased findings before the formal release.



We mentioned, for example, that just 35% of advisers say they’re able to buy crypto for client accounts. Looking a bit deeper, 71% of these financial pros said at least some of their clients were investing in crypto on their own.&nbsp;



“These held-away assets represent a major business opportunity for advisers seeking to help clients integrate crypto into a broader wealth plan,” the report notes. This sort of statement is nothing new, but rather <a href="https://blockworks.co/news/wealth-managers-bitcoin-etfs">drives the point home</a>.



While nearly two-thirds report the inability to own crypto for clients, 22% allocated for clients in 2024 (twice the 11% <a href="https://blockworks.co/news/tradfi-bitcoin-economics-crypto-etf">in 2023</a>).&nbsp;



Of the advisers who haven’t yet invested, 19% plan to “definitely” or “probably” add exposure to the asset class this year. That’s more than double the percentage (8%) who said as much in last year’s report.



Other findings surprising to me:



<ul class="wp-block-list">
<li>Though US spot bitcoin ETFs notched $36 billion of net inflows in their first year, flows into ETH products accelerated in December and <a href="https://blockworks.co/news/solana-etf-filing-futures">filings</a> <a href="https://blockworks.co/news/canary-capital-litecoin-etf">for</a> <a href="https://blockworks.co/news/us-sol-etfs-unlikely-to-be-approved-soon">other</a> <a href="https://blockworks.co/news/bitwise-files-for-spot-xrp-etf">spot</a> crypto funds have proliferated, advisers thinking about jumping into crypto favor equity funds. Perhaps State Street Global Advisors’ <a href="https://blockworks.co/news/state-street-galaxy-crypto-etfs">mindset has legs</a>, and we recently heard about how BLOK co-PM Dan Weiskopf is <a href="https://blockworks.co/news/2025-crypto-stocks-to-watch">thinking about things</a>.</li>



<li>Secondly, despite the 56% swayed <a href="https://blockworks.co/news/crypto-impacts-since-election-outcome">by the election</a>, half the surveyed advisers still consider regulatory uncertainty the top hurdle for future crypto investments. That’s down from closer to two-thirds in previous years, but shows the wins of Trump and pro-crypto Congress members have not solved everything overnight.</li>
</ul>



The latter point confirms that amid the <a href="https://blockworks.co/news/2025-crypto-industry-predictions">optimism of progress</a>, there remains plenty of <a href="https://blockworks.co/news/2025-crypto-questions-to-answer">healthy skepticism</a> — or at least patience — from those weighing their next move.



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Election swayed advisers, but crypto adoption has room to run

Felix Jauvin

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance">subscribe</a>.



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Back in September, the market priced one of the most aggressive cutting cycles I’ve ever seen, with multiple 50-basis point cuts priced in that would swiftly take us to 3% on the fed funds rate in 2025. Fast forward to today, and it&#8217;s a completely different story, with one to two cuts at best priced for 2025.



Let’s dig into what has driven the change and what to expect.



Below is a chart that compares the effective federal funds rate (EFFR) against the two-year Treasury note.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcR0plmd2BY79J0Lm8s1uFtSBQrfsoMG1zgJo30zNgC5us4A5efOH49YkJ-Gz0_epW-eb2ydI0htUZyJGOFcTdR72bujpyIOyn989MT-amU2ExbxjF_NarlLfB5O-ag6L6kq_n2Mw?key=6LM0Kvlki2uiEmtTlAQaY0px" alt=""/></figure>



There’re a few takeaways we can grab from comparing these two yields:



<ul class="wp-block-list">
<li>Throughout the last two years, we’ve seen many moments where the two-year has priced in an imminent and aggressive cutting cycle (as seen when two-year heads lower below EFFR).</li>



<li>For the first time since mid-2022, we see these two yields are parity. This implies the market is pricing in a rate-cutting cycle that is essentially over, but it sees no chance of any hikes either.</li>
</ul>



One of the big drivers behind talk about a swift end to this short-lived cutting cycle is around surprisingly stubborn inflation. As we can see in the December summary of economic projections, FOMC members have aggressively shifted from seeing inflation as being broadly balanced to seeing risks weighted to the upside.



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="934" height="696" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png" alt="" class="wp-image-96051" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=934 934w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=345 345w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=350 350w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=294 294w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed.png?w=80 80w" sizes="(max-width: 934px) 100vw, 934px" /></figure>



This, paired with what is proving to be a much more resilient and solid labor market than what it appeared in September when the FOMC started to cut rates, is shifting the distribution of probable outcomes more toward a hawkish monetary reaction function.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1600" height="915" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=1024&amp;h=1024" alt="" class="wp-image-96052" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=1600 1600w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=456 456w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=383 383w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1.png?w=80 80w" sizes="(max-width: 1600px) 100vw, 1600px" /></figure>



Putting these pieces together shines a light on why there’s increasing conviction in the idea that the rate-cutting cycle is over.



That said, there are still dovish voices within the FOMC.&nbsp;



In his speech this week, Governor Waller mentioned he still believed in cutting this year: “So what is my view? If the outlook evolves as I have described here, I will support continuing to cut our policy rate in 2025. The pace of those cuts will depend on how much progress we make on inflation, while keeping the labor market from weakening.”



Much like the last two years, 2025 is shaping up to be another <a href="https://blockworks.co/news/fed-dovish-hawkish-2024-conduct">year of extremes</a> where the market goes from pricing in aggressive hawkishness to aggressive dovishness.&nbsp;



Investors will need to quickly decide whether to try and ride these changes in sentiment or ignore them as noise.



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