🔮 Stripe Bets Big On Stables, GOAT of Memes, Poly-tical Updates, Kraken Launches, FBI Uncovers Fraud

The Week In Markets

We're currently at a critical juncture where traditional finance and crypto markets appear to be aligning for a pivotal Q4. The S&P 500 continues to grind to new highs—a trend sparked when global liquidity reversed in early Q4 2023. Since then, the S&P is up 40%, but Bitcoin has outpaced it with a staggering 160% gain, underscoring how global liquidity fuels risk assets.

After a mid-year lull, liquidity expansion is back, setting the stage for risk assets to soar, much like we saw from October 2023 to March 2024. Gold has signaled this shift, acting as the canary in the coal mine. While Bitcoin has lagged behind gold recently, we anticipate it will catch up and potentially overtake as we delve deeper into Q4. The denominator—fiat currency—is losing value. It's "up only" from here.

What drives this unstoppable trend? Despite their differences, neither candidate in the upcoming U.S. presidential election is addressing the $35 trillion elephant in the room: national debt and deficits. Regardless of who wins, the U.S. is likely to continue its fiscal free-for-all, with debt projected to rise from $1.9 trillion in 2024 to $2.9 trillion by 2034, according to the Congressional Budget Office.

This unchecked spending devalues fiat currency, priming Bitcoin for continued outperformance—especially as institutional investors pile in via ETFs. For "everything else" in crypto, the outlook is more nuanced. Regulatory ambiguity stifles projects aiming to share value with token holders. The election could tip the scales here. A crypto-friendly administration might revive fundamental projects, while a hostile one could maintain the status quo. Recent market rallies suggest investors are betting on favorable outcomes, but we'll know soon enough.

Turning back to Bitcoin, the market structure is undeniably bullish. Seven months of consolidation above previous cycle highs have led to higher highs and higher lows. We're just 3% shy of breaking significant resistance levels. With open interest surging, expect short-term volatility—sharp moves in both directions before the inevitable breakout.

Amid the noise, remember the bigger picture. "Uptober" isn't just a meme; Bitcoin is mirroring its historically strong performance this month. ETF inflows are soaring, with an extra billion dollars in recent days, totaling nearly $20 billion. Traditional finance isn't just dipping a toe—they're diving in headfirst.

Top Stories

Stripe Enables 739,000 U.S. Merchants to Accept Crypto Payments

In a major leap for crypto adoption, Stripe has enabled 739,000 U.S. merchants to accept USDC payments through their online stores. With a simple toggle in their Stripe backend, merchants can now seamlessly accept cryptocurrency payments, which will automatically settle in USD—eliminating the need for crypto wallets or exchanges. This is a significant move, as Stripe processed $1 trillion in transactions in 2023, and 56% of active websites using Stripe are U.S.-based. Additionally, crypto subscriptions are set to launch soon, potentially driving further adoption. The integration could bring substantial growth to blockchains like Ethereum, Solana, and Polygon as more businesses embrace digital currencies. Stripe’s 2.1 million global merchants may soon follow suit, expanding crypto’s reach even further. Update: Stripe has acquired the stablecoin platform Bridge for $1.1 billion, making it Stripe’s largest acquisition and a major deal in the cryptocurrency industry. Bridge, co-founded by Sean Yu and Zach Abrams, enables businesses to process stablecoin payments.This move strengthens Stripe’s expansion into digital payments and cryptocurrency services after partnerships with Coinbase and Base layer-2 network integration.

DeFi Fee Decline Highlights Shift in Market Focus

DeFi fees dropped significantly to $218 million in September 2024, marking the lowest monthly total this year, down from a peak of $486 million in March. This decline suggests a broader market shift, with interest pivoting towards other sectors like memecoins. Despite this downturn, top protocols such as Lido, Uniswap, and Aave still lead in fee generation, showcasing continued user engagement with core DeFi services. As DeFi activity slows, the sector may need to innovate to attract new users and reinvigorate growth.

Kraken Launches Wrapped Bitcoin (kBTC) on Ethereum and OP Mainnet

Kraken has launched its own wrapped Bitcoin token, kBTC, on Ethereum and OP Mainnet, joining the competition in the growing market for Wrapped Bitcoin (WBTC) alternatives. The ERC-20 token is backed 1:1 by Bitcoin held at Kraken Financial, a Wyoming-chartered institution, with reserve transparency provided through an onchain address. Currently, 100 BTC ($6.7 million) backs an 80 kBTC and 20 kBTC supply on Ethereum and OP Mainnet. Audited by Trail of Bits, kBTC is compatible with various decentralized apps, and Kraken plans to extend its reach to other networks. This launch follows Coinbase's introduction of cbBTC, intensifying competition with WBTC, the dominant tokenized Bitcoin product.

GOAT Meme Coin Makes Truth Terminal a First AI Crypto Millionaire

Truth Terminal, an AI chatbot, has garnered attention as the first AI crypto millionaire after its involvement in promoting the GOAT meme coin on Solana. Created by AI researcher Andy Ayrey, Truth Terminal gained prominence through its engagement on social media, especially after a $50,000 Bitcoin donation from venture capitalist Marc Andreessen. The GOAT coin, which experienced a rally to over $400 million in market cap, significantly boosted Truth Terminal’s assets to more than $1 million. Arthur Hayes, BitMEX founder, predicted the token could reach a $1 billion valuation, attributing its success to the combination of AI, meme culture, and community dynamics. Truth Terminal’s journey highlights the growing intersection of AI and the cryptocurrency market, raising questions about the future roles of AI in decentralized finance.

World Liberty Financial Has Mixed Launch

World Liberty Financial (WLF), the DeFi project backed by Donald Trump and his sons, has reportedly gathered over 100,000 whitelist signups ahead of its WLFI token launch. Co-founder Zak Folkman, speaking in a live stream, highlighted that the project aligns with Donald Trump’s ideals. The WLFI token, an ERC-20, will have 63% sold to the public and 20% reserved for team compensation. The sale, targeting accredited U.S. and UK investors, aims to raise $300 million but the token ended up rasing $12 million within its first 24 hours. The sale attracted 10,885 unique wallet holders, despite earlier claims that 100,000 users had signed up for the whitelist. Priced at $0.015 each, only 4% of the allocated tokens have been sold so far. The sale faced multiple technical issues, including website outages due to high traffic. Despite its success, critics like Rep. Wiley Nickel have argued that Trump's involvement could undermine bipartisan crypto policy efforts. See similar: Trump Company Can Claim 75% of World Liberty Financial Revenue See more: Trump's World Liberty Financial Website Crashes During Token Sale

Regulation

FBI's Operation Token Mirrors Uncovers $25 Million in Crypto Fraud, Raises Legal Concerns

Last week, the FBI's Operation Token Mirrors led to the arrest of 18 individuals, the seizure of over $25 million in crypto, and the deactivation of 60 wash trading bots in a crackdown on market manipulation in decentralized finance (DeFi). The DOJ and SEC have filed charges against the participants, with Acting U.S. Attorney Joshua Levy calling it the first investigation of its kind. The FBI created a token, NextFundAI, to lure manipulators, but legal experts raised concerns about whether the token was properly registered with the SEC and whether the FBI’s tactics, including potential use of copyrighted code without proper licensing, could give defendants a legal defense. Despite these questions, the operation highlights ongoing efforts to address market manipulation in the crypto space.

Kamala Harris' Campaign Embraces Pro-Crypto Policies to Attract Voters

Kamala Harris’ presidential campaign took a significant step on Monday by introducing a pro-crypto agenda aimed at Black male voters. As part of the platform titled “Kamala Harris Will Deliver for Black Men,” Harris pledged to support a regulatory framework for cryptocurrency and digital assets, ensuring that Black men investing in these areas are protected. The platform further highlights Harris’ recognition of digital assets as tools for broadening access to banking and financial services. This marks her most explicit endorsement of pro-crypto policies, a notable shift after months of avoiding the subject. The move comes as the campaign works to strengthen support among Black male voters, a critical demographic that has raised concerns about dwindling enthusiasm for the Democratic nominee. Along with crypto policies, the platform includes promises to legalize marijuana, provide forgivable loans for Black entrepreneurs, and create job training programs for Black men.

No, The SEC Did Not Miss Its Deadline To Appeal Against Ripple Labs

Contrary to reports suggesting that the SEC missed its deadline to file an appeal in the Ripple Labs case, the agency has until October 18, 2024, to submit the necessary documents. Confusion arose after commentators believed the deadline had passed on October 16 based on the SEC’s Notice of Appeal filed on October 2. However, a docketing notice from October 4 clarified that the real deadline for the SEC’s filings is October 18. The case revolves around Judge Analisa Torres' landmark ruling that Ripple’s XRP token does not meet the Howey Test criteria for being classified as a security, a decision that challenges the SEC’s stance on most cryptocurrencies. See follow on: SEC Files Last-Minute Appeal in Ripple Case—Why the XRP Army is Outraged

Sui Doesn't Want to Get Sued Over Insider Selling Allegation

The Sui Foundation has refuted claims of insider selling during the token's recent price surge, stating that no insiders, including foundation employees or Mysten Labs members, participated in a $400 million token sale. The allegations surfaced after pseudonymous analyst Lightcrypto speculated on social media that insiders were unloading Sui tokens on the open market. However, the foundation explained that the large sale likely came from an infrastructure partner operating under a lockup schedule. Despite these concerns, Sui has seen significant price growth, with a 100% surge over the past month.

Other Domestic Regulation Updates

• Polymarket U.S. Election Odds Diverge Sharply from Traditional Polls
• FBI arrests Alabama man behind SEC social media hack and phony spot Bitcoin ETF post
• Former FTX Exec Ryan Salame Kicks Off Prison Stint with Bizarre LinkedIn Post
• U.S. SEC Charges Market Maker Cumberland DRW as Unregistered Dealer
• Harris Policy Doc Attracts Industry Pushback

Other International Regulation Updates

• British Man Demands He Be Allowed to Dig Through Trash to Find $500 Million in Bitcoin
• DTCC Unveils Digital Asset Sandbox
• Deutsche Bank Partners With Keyrock on Digital Cross-Border Payments
• Grayscale Considering 35 More Altcoins for New Trusts 
• Ripple Challenges Industry Giants With New Stablecoin
• Dubai Crypto Regulator Cracks Down on Unlicensed Firms 
• South Korean Courts Allow for Division of Crypto Assets in Divorces
• Italy plans to raise capital gains tax on Bitcoin from 26% to 42%

Pain & Gain

Pain

• Morpho User Exploits Oracle Error To Turn $350 Into $230K
• Radiant Capital exploited for over $50M across BNB Chain and Arbitrum

Gain

• Vitalik Buterin outlines ambitious 100,000 TPS goal for Ethereum
• Michael Saylor Wants to Turn Microstrategy Into a Bitcoin Bank