Asia Morning Briefing: Bitcoin’s Etfs Kill The Transaction FEES, PUNING The MINers More

Bitcoin’s Price Is Holding Near Records, But The Chain ITSELF IS QUiet. Glassnode Data Shows Transaction Fees Have Collapsed Back Toward Decade Lows, Even As BTC Flirts with Six Figures.

In Past Cycles, Fee Spikes Trained Bull Markets As Traders Bid for BlockSpace. This Year, The FEE CURVE IS FLAT WHILE PRICE RISES, A CLEAR SIGN THAT OnCchain Demand is No Longer Driving the Market.

(Glassnode)

A New Report from Galaxy Research Shows Median Daily Fees Have Fallen More More 80% Since April 2024, with As Much As 15% of Daily Blocks Now Clearing at Just 1 Satshi. Nearly Half of Recent Blocks Are Not Full, Signaling Weak Demand for Blockspace and A Doormant Mempool.

This is a Sharp Contrast to Prior Bull Cycles, WHERE PRICE Rallies Translated Into Congdom and Fee Spikes.

The Data Confirms A Structural Shift: Spot etfs and Custodians Now Hold More than 1.3 Million Btc, and Coins Parked in Those Wrappers Rarely Touch The Chain Again.

At Same Time, Retail Activity That Once Clogged The Bitcoin Bitcoin Blockchain Has Migrated to Solana, Whore Memecoins and NFTS BENEFIT FROM CHEAPER AND FASTERTECUTION. The Result, Galaxy Notes, is that Bitcoin Price Is Being Set by Custodial Inflows While the Network’s Onchain Demand – Once A Proxy for Price Movement – Has Slowed Down.

For Mines, this dynamic is Particularly punishing. With Rewards Halved to 3.125 BTC and Fees Contributing Less than 1% of Block Revenue in July, Profitability Is Under Strain. That stress is pushing listed minrs to diversify into ai and hpc hosting.

Read More: Bitcoin Mining Faces ‘Incredibly Difficult’ Market As Power Becomes The Real Currency

A report from earlier this year by rittenhouse research argues that galaxy digital’s move out of mining altogether could be the model for the Sector.

This Move Has Been Applauded by the Equity Markets. While Btc is Down More than 3% on-year, The Coinshares Bitcoin Mining etf Has Gained Nearly 22%. Investors Are Rewarding Firms That Have Leaned Into Diversification Racher Thank on Block Rewards Alone.

Listed Mines Tell A Similar Story. Hive, Core Scientific, and Terawulf All Reported Q2 Results Padded by HPC and AI Hosting Revenues.

Those with no diversification, like bitdeer and bitfufu, remain deeply exposed to electricity costs, Equipment Department, and a fee market that glyaxy Warns in.

The JuxTaposition Is Telling: Galaxy’s Own Research Warns That Bitcoin Bitcoin Blockchain’s Settlement Role Is Stagnating, While Galaxy’s Balance Sheet Is Being Repositioned.

Onchain Data Makes the Point: Without Organic Demand for BlockSpace, Fees Can’s Fund Security. And if fees stay Low, Equity Markets Are Painting A Clear Picture That Mining Sector’s Best Future Returns May Come Coom AI, Not Bitcoin.

Market MovementsBTC: Bitcoin Traded AT $ 113,286.95, Down 1.79%, After Briefly Plunging to A Six-Week Low Near

Eth: Ether Traded Flat at $ 4,779 As Jerome Powell’s Dovish Jackson Hole Remarks Boosted Expectations Despite Risks from Treasury Adoption and Equity Volatility.

GOLD: Gold Closed AT $ 3.371 After Powell’s Dovish Jackson Hole Remarks Boosted September Rate-Cut Odds.

Nikkei 225: Asia-Pacific Stocks ClimBed Monday, with Japan’s Nikkei 225 UP 1.08%, After Powell Signaled Potential Fed Rate Cuts in September During his Jackson Hole Speech.

Elsewhere in Crypto

• The FUNING: WHY RAISING A CRYPTO VC FUND IS HARDER NOW – EVEN IN A BULL Market (The Block)
• WHY LUCA NETZ WILL BE ‘DISAPPOINTED’ IF PUDGY PENGUINS DOESN’T IPO WITHIN 2 YEARS (DECRYPT)
• KPMG Says Investor Interest in Digital Assets Will Drive Strong Second Half for Canadian Fintechs (Coindesk)