Monthly Review of April 2024

In this monthly review, we'll be looking at the most significant cryptocurrency-related news of April. The most important cryptocurrency news in April was related to Bitcoin's halving, ETF news from Hong Kong and the United States, Tether and Metaplanet's bitcoin purchases, Chainlink's Transporter application, and the cryptocurrency research released from the Nordics.

              
April in the Cryptocurrency Markets
Following a positive price development in the first quarter, cryptocurrency prices were down in April. There wasn't one clear factor behind the decline in the cryptocurrency market, but contributing factors included a decrease in funds flowing into the U.S. Bitcoin spot ETF's and weaker-than-expected economic indicators in the United States. Among the cryptocurrencies offered by Northcrypto, the two largest cryptocurrencies by market capitalization, Bitcoin and Ethereum, saw prices drop by around 15 and 17 percent, respectively. Litecoin experienced a drop of nearly 25 percent during the month, while the price of Chainlink fell by approximately 30 percent. Aave and Polygon prices were down by nearly 35 percent. Dogecoin and ApeCoin prices dropped by almost 40 and about 42 percent, respectively.
Bitcoin Block Reward Halved for the Fourth Time
Bitcoin's block reward halved in the early hours of April 20th, Finnish time, after nearly four years of anticipation. This marked the fourth halving in Bitcoin's history, reducing the block reward from 6.25 bitcoins to 3.125 bitcoins in block number 840,000. At the time of the halving, 19,687,500 bitcoins had been mined, accounting for 93.75 percent of the maximum supply of 21 million bitcoins. Between the April 2024 halving and the next halving expected in about four years, a total of 656,600 bitcoins will be mined, representing 3.125 percent of the total supply of bitcoins.
ETF News from Hong Kong and the United States
Hong Kong, a special administrative region of China, approved the first Bitcoin and Ethereum spot ETF applications in April. The ETFs began trading in Hong Kong at the end of April. The trading volume of ETFs on the first day was approximately ten million euros. However, some cryptocurrency experts expect significantly more funds to flow into Hong Kong's ETFs in the near future. Hong Kong has a population of around 7.5 million people and is considered a very advanced economic region.
In late April, it was revealed that the U.S. bank Morgan Stanley is exploring whether its brokers could recommend Bitcoin ETFs to their clients. This information was obtained from AdvisorHub, a news source specializing in financial advisors. This would be a significant step forward, as Morgan Stanley is one of the largest banks in the U.S., and Bitcoin ETFs could be recommended by the bank's approximately 15,000 brokers. Like many other banks, since January, Morgan Stanley has only been able to offer Bitcoin ETFs to its clients upon request. With the possibility of recommendations, brokers could proactively suggest investing in Bitcoin ETFs to their clients. In addition, at the end of April, Morgan Stanley filed an application with the U.S. Securities and Exchange Commission (SEC) that, if approved, would allow 12 of the bank's funds to invest in Bitcoin ETFs.
Tether and Metaplanet's Bitcoin Purchases
In April, it was revealed that Tether International Limited (Tether), which manages the reserves of the stablecoin USDT, purchased nearly 8,900 bitcoins during the first quarter. This information was obtained by Arkham Intelligence, a company specializing in blockchain analytics. Tether has previously purchased bitcoin, and with the latest purchase, the company's bitcoin holdings increased to over 75,300 bitcoins, valued at over 4.2 billion euros by the end of April. Tether originally announced plans about a year ago to invest 15 percent of its profits in bitcoin.
Japanese investment firm Metaplanet, specializing in Web3, announced in April that it had purchased bitcoin for its balance sheet. Metaplanet made a bitcoin purchase of just over 6 million euros. When Metaplanet announced its plan to buy bitcoin, this had a positive impact on the company's stock price, which rose by about 50 percent in April after the announcement. According to Metaplanet, this is a significant milestone that helps the company take the lead in the adoption of cryptocurrencies in Japan.
Chainlink Releases Transporter Application
Oracle solution Chainlink released the Transporter application in early April, enabling the transfer of cryptocurrencies between different platforms. Transporter utilizes Chainlink's Cross-Chain Interoperability Protocol (CCIP) technology, released in 2023, which enables smart contract operations, data transfer, and cryptocurrency transfers between different platforms. Initially, Transporter is available on eight platforms, including Ethereum, Polygon, and BNB Chain. According to comments from Chainlink, Transporter aims to provide a cost-effective and peace-of-mind way to make high-value cryptocurrency transfers between different blockchains.
Cryptocurrency Research from the Nordics
Consulting firm EY and cryptocurrency research company K33 Research published the results of cryptocurrency research focusing on the Nordic countries in April. According to the research, 300,000 Finns, representing about seven percent of the Finnish population over 18 years old, own cryptocurrencies. About 11 percent of men and about three percent of women own cryptocurrencies. The largest proportion of cryptocurrency owners among age groups is in the 18-29 age group, with about 12 percent owning cryptocurrencies. The researchers anticipate that over the next decade, the number of Finns owning cryptocurrencies may rise to over one million, representing nearly a quarter of Finland's adult population.
Summary
Cryptocurrency prices were generally quite significantly down in April. Tracking price movements in the cryptocurrency market in the near future will be interesting, as many experts expect the effects of Bitcoin halving, which has historically had a positive impact on the cryptocurrency market, to begin to show in the coming months.
Hong Kong followed in the footsteps of the U.S. in April as the region's first Bitcoin spot ETFs received approval. This is a very positive step forward, signaling positive sentiments toward cryptocurrencies, including from China, which has imposed various cryptocurrency bans. The progress related to Morgan Stanley's Bitcoin spot ETFs did not come as a surprise to many cryptocurrency experts, and many expect this trend to accelerate among banks in the U.S. in the near future.
Tether, managing the reserves of the stablecoin USDT, has continued its expected bitcoin purchases. Thus, Tether can be grouped together with, for example, MicroStrategy, a U.S. company regularly increasing its bitcoin holdings. The decision of Japanese company Metaplanet to buy bitcoins for its balance sheet was well received not only by the cryptocurrency community but also among investors, as evidenced by positive movements in the company's stock price.
Oracle solution Chainlink continued to diversify its offerings with the Transporter application, which improves cryptocurrency transfers. The solutions released by Chainlink in recent years, along with several significant partnerships, strengthen Chainlink's position as one of the most important projects in the entire cryptocurrency ecosystem.
The results and forecasts from the cryptocurrency research focusing on the Nordic countries, released in April, are positive for the adoption of cryptocurrencies. If the number of cryptocurrency investors in Finland and elsewhere in the world increases as forecasted in this decade, it will also likely lead to positive years for cryptocurrency price movements.

Ville Viitaharju
Cryptocurrency specialist
            

Last updated: 02.05.2024 15:30