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Cryptocurrency Market Cap Hits Record $3.84 Trillion Amid Bitcoin Surge

The cryptocurrency market cap has reached an all-time high of $3.84 trillion, surpassing its previous peak of $3 trillion in November 2021. This represents a 92% increase since September 2024, driven by Bitcoin’s climb to $100,000 and significant institutional inflows into Bitcoin ETFs, which have seen six consecutive weeks of net positive inflows. Bitcoin remains the dominant asset, contributing nearly $2 trillion, followed by Ethereum at $480 billion and XRP at $139 billion, with these three assets collectively accounting for 68% of the market. The surge reflects a market increasingly shaped by institutional adoption and regulatory advancements, marking a shift from the speculative-driven dynamics of 2021.

Source: CoinGecko

DeFi Lending TVL Surges

The broader crypto rally has fueled a surge in DeFi lending protocols, with total value locked (TVL) rising from $33 billion a month ago to $49.3 billion today. Leading platforms like Aave, Spark, and Morpho have seen TVL growth of over 50%, 60%, and 70% respectively, while niche protocols have experienced even greater increases. Rising demand has allowed lenders to charge higher interest rates, some reaching 20%, but it has also amplified market risks. Techniques like looping, where users repeatedly leverage assets to maximize exposure, have yielded significant gains for some but increased volatility. Currently, over $20 million in Lido Staked Ethereum (stETH) is at risk of liquidation if Ethereum’s price drops below $3,292, underscoring the potential dangers of leveraged positions in a volatile market.

Source: DeFiLlama

Stablecoin Loan Interest Rates Soar Amid High Demand on Aave and Compound

Stablecoin borrowing rates on Aave and Compound have skyrocketed, with traders leveraging digital assets heavily despite recent market pullbacks. Aave data reveals Tether (USDT) and USD Coin (USDC) borrowers paying peak annual percentage yields (APY) of 23% and 28.14%, while depositors earn up to 17.6% and 24.6%, respectively. Utilization rates on Aave exceed 93% for both USDT and USDC, pushing rates to their highest levels in over a year. Smaller stablecoins like USDS, PayPal USD, and USDe are also in high demand, with utilization ratios ranging from 73% to 92%. Similarly, Compound users face borrowing rates above 20% for USDT and USDC. Lower rates are available on JustLend and Spark, where borrowing costs for stablecoins are 5% and 9.5%, respectively. These elevated rates highlight intense demand for leverage in the DeFi space.

Coinbase Adds Apple Pay Integration to Streamline Crypto Purchases

Coinbase has integrated Apple Pay into its Coinbase Onramp service, allowing users of crypto apps to purchase cryptocurrencies like Bitcoin and Dogecoin directly with their Apple Pay Wallets. This feature, available without additional KYC requirements for certain apps, enables fiat-to-crypto transactions in seconds, with free onramping through USDC. Popular apps like Moonshot already support the feature, which opens access to Apple Pay’s 60 million U.S. users. This move is part of Coinbase’s broader push to simplify onboarding for crypto adoption, building on prior integrations and recent acquisitions like Utopia Labs to enhance on-chain payments.

Vitalik Buterin Proposes Enhanced Ethereum Wallet Standard for Security and Privacy

Ethereum co-founder Vitalik Buterin outlined a vision for an improved Ethereum wallet standard in a Dec. 3 blog post, emphasizing the need for better security, privacy, and usability. Citing wallets as the crucial bridge between users and the ecosystem, Buterin proposed features like seamless cross-Layer 2 transactions, chain-specific addresses, and built-in send functionality to simplify token transfers. He suggested a two-key security model for safeguarding against hacks and user errors and advocated for privacy pools and stealth addresses to enhance user anonymity. This initiative aligns with Buterin’s broader goal of creating a unified Ethereum experience, fostering a more secure and user-friendly ecosystem.

Hawk Tuah Spit On That Rug

Hailey Welch, famously known as the "Hawk Tuah" girl, launched the HAWK meme coin, which skyrocketed to a $490 million market cap before crashing by over 93%. Allegations of a rug pull arose as interconnected wallets dumped large amounts of HAWK, netting over $3 million, with blockchain analysis revealing that 285 wallets controlled 96% of the supply. While Welch’s team denied wrongdoing, claiming the sell-offs were part of HAWK's tokenomics roadmap and that the team sold no tokens, findings indicated that KOLs and strategic advisors offloaded tokens, leading to the collapse. Crypto Twitter remains skeptical, accusing Welch of deception, with Community Notes branding the explanations as misleading.

Source: Twitter

Regulation

Bitcoin Reaches $100,000 Amid Trump Win and Institutional Interest

Bitcoin reached a historic $100,000 milestone, gaining over 5% in 24 hours and surging nearly 50% since Donald Trump's pro-crypto election victory. The rally, which marks a 138% year-to-date increase, was driven by positive sentiment surrounding expectations for clearer regulations under the incoming administration. Institutional interest played a pivotal role, with MicroStrategy acquiring $13.5 billion in Bitcoin last month, bringing its holdings to 402,100 BTC, and U.S. spot Bitcoin ETFs generating $32 billion in net inflows. The milestone also coincided with significant movements in the crypto space, including Mt. Gox transferring $2.4 billion in BTC and WikiLeaks using the Bitcoin blockchain for secure data protection.

South Korea’s Martial Law Sparks Record $34 Billion Crypto Trade Surge

South Korean crypto exchanges recorded an unprecedented $34.2 billion in trading volume within 24 hours during a brief emergency martial law declaration by President Yoon Suk-yeol. Upbit, the largest exchange, processed $27.25 billion alone. The law, citing threats to democracy, triggered a market sell-off, briefly dropping Bitcoin's price to $62,182 on Upbit and causing outages. Martial law was lifted after six hours following unanimous parliamentary opposition. The incident has led to political fallout, with opposition parties filing treason charges against President Yoon and his ministers while pushing for impeachment.

Source: 10xResearch

Trump Appoints David O. Sacks as White House AI and Crypto Czar

President-elect Donald Trump has named David O. Sacks, founder of Yammer and former PayPal COO, as the "White House AI and Crypto Czar." Sacks will develop U.S. policies in artificial intelligence and cryptocurrency, focusing on competitiveness and regulatory clarity, while also chairing the Presidential Council of Advisors for Science and Technology. This appointment underscores Trump’s pro-crypto agenda, further reflected in his recent nomination of former SEC Commissioner Paul Atkins as SEC chair.

SEC Poised to Reject Solana ETF Applications Amid Regulatory Challenges

The SEC reportedly plans to reject multiple applications for spot Solana ETFs, citing a policy under the Biden administration not to approve new crypto ETFs. This decision affects issuers like Grayscale, VanEck, 21Shares, and Bitwise, despite growing optimism surrounding crypto ETFs after rulings that found XRP is not a security. Solana's regulatory status remains uncertain, as the SEC has labeled SOL a security in lawsuits against major exchanges. Additionally, the lack of regulated futures markets for Solana and XRP further complicates approval. The incoming Trump administration may bring a more favorable stance toward crypto ETFs, but obstacles remain for assets like Solana and XRP.

BlackRock Bitcoin ETF Surpasses 500,000 BTC in Assets Under Management

BlackRock's iShares Bitcoin Trust (IBIT) has reached a milestone of over 500,000 BTC ($48 billion) in assets under management less than a year since its January launch, representing 2.38% of Bitcoin's total supply. With $338.3 million in net inflows on December 3 alone, IBIT is the fastest-growing ETF in history. Analysts predict IBIT could amass 1 million BTC in the coming years as institutional adoption grows. U.S. spot Bitcoin ETFs collectively added $31.2 billion in inflows to date, with BlackRock’s offering leading the charge and contributing significantly to Bitcoin's price rally to new all-time highs.

Other Domestic Regulation Updates

• Kraken to Shutter Its NFT Marketplace
• Former Celsius CEO Alex Mashinsky pleads guilty to fraud in manipulating CEL token and defrauding investors

Other International Regulation Updates

• Bitcoin Strategic Reserve Bill Introduced in Brazil
• Taiwan Regulator Tightens AML Rules, Launches Bank Custody Trials
• Solana Meme Coin Launchpad Pump.fun Bans UK Users After Regulator Warning

Pain & Gain

Pain

• Japanese Crypto Exchange to Shut Down After $300M Hack, Transfer Accounts to SBI
• Polymarket Is Holding Onto Loyal Users Post-election
• Solana Stablecoin ISC Money to Shut Down Operations

Gain

• XRP Ledger developers lower base reserve for accounts to 1 XRP amid price surge
• VC Surges in November With Ninety-Nine Blockchain Startup Deals
• MARA Holdings to Issue $700MM in Convertible Notes to Buy BTC