Monthly Review of March 2024
This monthly review examines the most important cryptocurrency news in March. The most significant cryptocurrency news in March related to the bitcoin purchases by American companies, the progress of the world's largest asset manager in the cryptocurrency market, the growing interest of pension funds in Bitcoin, Deutsche Boerse's cryptocurrency trading platform, and Ethereum's Dencun update.
March in the Cryptocurrency Market
March was a positive time for cryptocurrency price movements similar to February. The price of the largest cryptocurrency in the market, Bitcoin, set a new all-time high in March, reaching over 67,000 euros. For the entire month, the price of Bitcoin increased by about 15 percent. However, the best-performing among the cryptocurrencies offered by Northcrypto was the latest addition, Dogecoin, which surged by as much as 90 percent in March. The rise of Dogecoin can be attributed to the growing popularity of the so-called meme coin market in March. Among other cryptocurrencies offered by Northcrypto, the price of Litecoin rose by almost 30 percent and Aave by about 20 percent. Ethereum and ApeCoin prices, on the other hand, increased by nearly ten and about five percent, respectively. The prices of Polygon and Chainlink ended the month very close to the same prices as at the beginning of the month.
American Companies' Bitcoin Purchases
US company MicroStrategy, providing business intelligence solutions, cloud-based services, and mobile software, announced in March two new bitcoin purchases. Both purchases were made using funds from the company's convertible note issuances. MicroStrategy's bitcoin holdings increased by over 21,000 bitcoins to 214,246 bitcoins with the March purchases, which means that the company's bitcoins represent over one percent of the maximum of 21 million bitcoins. The average price of MicroStrategy's bitcoin purchases after the March purchases is about 31,300 euros, and the value of the company's Bitcoin holdings was over 14 billion euros at the end of March.
In addition to MicroStrategy, there was more surprising news related to Bitcoin purchases in March when South American gold mining company Nilam Resources announced the acquisition of 24,800 bitcoins, worth slightly over 1.6 billion euros at the end of the month. Nilam Resources used funds from the issuance of newly issued company shares to acquire bitcoins.
World's Largest Asset Manager's Advancements in the Cryptocurrency Market
The world's largest asset manager, BlackRock, intends to purchase Bitcoin spot ETFs for its Strategic Income Opportunities Fund and Global Allocation Fund. The former mainly invests in fixed-income products, while the latter invests in equities and fixed-income products. BlackRock's intentions are evident from the applications submitted to the U.S. Securities and Exchange Commission (SEC). BlackRock's own Bitcoin spot ETF has been the most popular among ETFs released in January, as the ETF had collected nearly 18 billion euros in assets by the end of March.
In connection with BlackRock, another interesting news emerged in March when the asset manager's USD Institutional Digital Liquidity Fund was brought onto the Ethereum blockchain, i.e., the fund was tokenized. This was done in collaboration with Securitize, a company specializing in tokenization. Tokenization refers to the process where ownership rights of an asset are represented as digital tokens and stored on the blockchain. According to blockchain data, BlackRock initially added $100 million worth of USDC stablecoin to the fund. Tokenizing the fund in this way does not come as a big surprise, as BlackRock's CEO Larry Fink spoke in favor of the tokenization trend in January.
Growing Interest of Pension Funds in Bitcoin
The world's largest pension fund by assets under management with funds of about €1,3 trillion, the Government Pension Investment Fund of Japan, announced in March that it is studying Bitcoin as an investment. Currently, the pension fund's investments consist of Japanese and foreign stocks and bonds, real estate, infrastructure, and private equity. Earlier this year, legislation was proposed in Japan that would allow investment funds to own Bitcoin and other cryptocurrencies.
In addition to the news from Japan, the state of Arizona in the southern western United States is considering adding Bitcoin spot ETFs to two state pension investment portfolios. The state senate approved the proposal with a vote of 16-13, and now the proposal is progressing through the state's legislative process. If approved, it would encourage the Arizona State Retirement System and the Public Safety Personnel Retirement System to consider adding Bitcoin spot ETFs to their investment portfolios.
Deutsche Boerse Launched Cryptocurrency Trading Platform
Deutsche Boerse, the operator of Germany's largest stock exchange, launched the Deutsche Boerse Digital Exchange cryptocurrency trading platform for institutional investors at the beginning of March. Deutsche Boerse implemented this with its subsidiary Crypto Finance, which is responsible for settling trades and storing cryptocurrencies. According to Deutsche Boerse's comments, their goal is to ensure transparency, security, and compliance with regulations.
Ethereum Successfully Received the Dencun Update
Ethereum successfully received the Dencun update on the 13th of March. Dencun can be considered Ethereum's most anticipated update since the Merge upgrade in September 2022. Dencun included a total of nine Ethereum Improvement Proposals (EIPs). The purpose of Dencun is to reduce transaction fees, especially for layer 2 scalability solutions on Ethereum, and thereby improve Ethereum's scalability.
Summary
March was a positive time for cryptocurrency price movements, thanks in part to Bitcoin's new all-time high. Thus, the price of Bitcoin exceeded the previous all-time high for the first time before the block reward halving, which is happening around the 20th of April. In addition, it is worth mentioning the price surge of the market's first meme coin, Dogecoin, which increased by 90 percent in a month.
The bitcoin purchases by American companies, especially MicroStrategy's purchases, have become a regular occurrence in the cryptocurrency market, as the US company has bought bitcoin over 30 times. However, the bitcoin purchase by gold mining company Nilam Resources came as a surprise to many. This is a very interesting development that serves as one more reason why many cryptocurrency experts compare Bitcoin to digital gold.
The positive actions taken by the world's largest asset manager, BlackRock, regarding cryptocurrencies, can have a wide-ranging impact, as BlackRock can be considered the most followed financial actor in the world outside of governmental entities. BlackRock's actions indicate that it has noticed the increased interest in both Bitcoin and tokenization and the world's largest asset manager wants to get more involved in the growing cryptocurrency market.
The growing interest of pension funds and traditional stock exchange in cryptocurrencies can be seen as a continuation of the trend where large banks and asset managers have entered the cryptocurrency market in recent years by offering cryptocurrency services and ETFs. In particular, the growing interest of pension funds bodes well for the future of cryptocurrencies. Pension funds globally manage trillions of euros in assets, and if even a small portion of this were invested in cryptocurrencies, it would have a significant positive impact on the approximately €2.5 trillion cryptocurrency market.
Ethereum successfully received the Dencun update in March, and the timing of the update was excellent, especially considering the increasing competition between Ethereum and Solana in recent months due to Solana's growing popularity. With the Dencun update, transaction fees for layer 2 scalability solutions utilizing Ethereum's security dropped significantly, making the leading smart contract platform even more attractive overall.
Ville Viitaharju
Cryptocurrency specialist
Last updated: 05.04.2024 15:00
