Halving of Bitcoin

Bitcoin experiences significant drop following halving; Hong Kong approves launch of ETFs for Bitcoin (BTC) and Ethereum (ETH); TON gains attention with impressive growth and other top news from last week.

Anticipation builds for the halving
With the fourth Bitcoin halving approaching, discussions surrounding the highly anticipated event dominated the week leading up to its implementation. On April 16, Kris Marszalek, CEO of crypto.com, stated that BTC could see a sell-off immediately after the halving. However, Marszalek maintained that the halving would have a bullish long-term effect on BTC. Interestingly, just a day after his comments, Bitcoin experienced a significant drop, falling to a low of $59,600 on April 17 before recovering to $61,277. This drop led to $115 million in liquidations within a span of four hours.

Reports also indicated that Bitcoin mining stocks had been declining prior to the halving. Marathon Digital saw a 25% decrease in value over the course of a month, the Valkyrie Bitcoin Miners ETF dropped 28%, and Riot Platforms experienced a 30% decline.

Matt Hougan, CIO of Bitwise, argued in a CNBC interview that the Bitcoin halving is a “buy-the-news” event, citing previous halvings that resulted in long-term price rallies.

Bitcoin network experiences surge in transaction cost
Before the halving, the Bitcoin network saw a rise in transaction fees due to the emergence of Runes, a fungible token protocol developed by Casey Rodarmor, the founder of Ordinals. As participants began minting Runes, Bitcoin network fees spiked to $19 on April 18.

Crypto market slides post-halving
The Bitcoin halving finally occurred on April 20 at 00:09 UTC during the 840,000th Bitcoin block. This event reduced Bitcoin block rewards from 6.25 BTC per block to 3.125 BTC, effectively cutting Bitcoin’s inflation rate in half.

Following the halving, crypto prices experienced a slight decline, as predicted by Bitwise CIO Hougan and crypto.com CEO Marszalek.

Within hours of the halving, the global crypto market cap dropped by 1.32%, although meme coins like Duko saw significant gains.

Hong Kong approves spot crypto ETFs
In a positive turn of events, the Hong Kong Securities and Futures Commission (SFC) conditionally approved the launch of spot Bitcoin and Ethereum ETFs.

This approval does not immediately allow trading of these ETFs, but it permits asset managers in Hong Kong to submit applications for their trading. The applications will go through a vetting process by the SFC before they can be launched.

Bloomberg ETF analyst Eric Balchunas expects the market to see massive capital inflows amounting to $1 billion in the first two years following this approval.

US regulatory landscape
Lawmakers in Arkansas have taken steps to approve two bills that could restrict crypto mining activities in the state. However, these bills are not yet full-blown legislation.

U.S. Senators Cynthia Lummis and Kristen Gillibrand have introduced a bill, in collaboration with the New York State Department of Financial Services and the Federal Reserve, to regulate the operations of stablecoins in the U.S.

While regulatory discussions continue, Senator Marsha Blackburn has reignited talks about central bank digital currencies (CBDCs), expressing concerns about their impact on privacy for U.S. citizens. Blackburn favors Bitcoin over CBDCs.

In its ongoing enforcement efforts, the U.S. Securities and Exchange Commission (SEC) has revealed in an updated complaint that it may pursue legal action against Justin Sun, the founder of the Tron network.

Global regulatory efforts
The U.K. government has confirmed its intention to implement stablecoin and cryptocurrency laws by the third quarter of this year.

Norway has also taken a strong stance against crypto mining, with reports suggesting that the country’s legislative body is considering new legislation to crack down on mining activities.

TON records impressive growth
The Open Network’s (TON) ecosystem has experienced a three-fold growth over the past 30 days, surpassing $148 million.

On April 19, on-chain data confirmed that Tether minted $10 million worth of its USDT stablecoin on the TON blockchain, leading to a 17% price surge for the TON native token.

On the same day, leading crypto payment provider Mercuryo announced a partnership with TON to launch a fiat-to-crypto on-ramp service specifically for USDT on the TON blockchain. The TON Foundation also introduced an incentive program to reward USDT users with 11 million TON as part of the partnership.

Pavel Durov, founder of Telegram messenger, discussed the innovative futures of the TON blockchain at the Token2049 conference in Dubai.

Highlights from Token2049
The Token2049 conference and the Blockchain Life conference were disrupted by rainfall and flooding.

At Token2049, Binance CEO Richard Teng discussed regulatory affairs related to stablecoins and the detainment of Binance executives in Nigeria.

Binance COO Noah Perlman noted that the platform’s agreement with the U.S. Department of Justice has presented challenges to its global expansion plans.

Emin Gün Sirer, CEO of Ava Labs, argued that Avalanche was never intended to be an Ethereum competitor, contrary to popular belief.

Read more: MiCA will establish the EU as a hub for crypto adoption this year.