Monthly Review of May 2024

In this monthly review, we examine the most important cryptocurrency-related news from May. The most significant cryptocurrency news in May involved the approval of the Ethereum spot ETF in the United States, purchase announcements of Bitcoin spot ETFs, Bitcoin-related advancements in Latin America, Chainlink's pilot project, and Aave's announcements regarding the release of a new version and a scalability solution.

              
May in the Cryptocurrency Markets
May was a very positive time for cryptocurrency price movements, and for example, all cryptocurrencies offered by Northcrypto were on the rise during the month. The best-performing cryptocurrency offered by Northcrypto was Chainlink, whose price rose by as much as 40 percent. Solana's price increased by nearly 30 percent, while the prices of Ethereum and Aave were up by about 25 percent. The price of Dogecoin rose by nearly 20 percent, while Bitcoin's price was up by slightly more than 10 percent. The price of ApeCoin increased by about seven percent, while the prices of Litecoin and Polygon ended the month about four percent higher than at the beginning of the month.
Ethereum Spot ETF Approved in the United States
The most significant cryptocurrency news in May was the approval of Ethereum spot ETF applications in the United States on May 24. At the beginning of May, the probability of ETF approval in the market was only about ten percent, so things progressed in a positive direction very quickly during the month. The U.S. Securities and Exchange Commission (SEC) approved a total of eight Ethereum spot ETF applications. The most significant entity behind the approved applications is considered to be the world's largest asset manager, BlackRock. The first similar Bitcoin spot ETFs were approved in the United States earlier this year in early January. Ethereum ETFs are expected to become available for trading in the near future – possibly during June or July.
Significant Announcements of Bitcoin Spot ETF Purchases
Several announcements related to Bitcoin spot ETF purchases made during the first quarter in the United States appeared in May. Hundreds of entities, including large banks, investment companies, and hedge funds, announced their purchases. The popularity of Bitcoin spot ETFs has been quite high since their launch. For example, the assets of BlackRock's ETF, the world's largest asset manager, exceeded $20 billion in May. BlackRock's Bitcoin spot ETF reached this milestone significantly faster than any previously launched ETF.
In terms of dollar value, the most significant Bitcoin spot ETF purchases announced in May came from the international private equity fund Millennium Management and the U.S. company Susquehanna International Group, specializing in quantitative trading. Millennium Management announced that it had purchased Bitcoin spot ETFs worth approximately €1.8 billion. With this size of purchase, Millennium Management is believed to be the largest holder of the new U.S. Bitcoin spot ETFs. Susquehanna International Group, on the other hand, filed a notice with the SEC revealing approximately €1 billion worth of Bitcoin spot ETF purchases.
The most significant entities behind the purchases were the U.S. banks Morgan Stanley, JPMorgan, and Wells Fargo, the French bank BNP Paribas, and the Wisconsin State Investment Board. Among the aforementioned, the sizes of Morgan Stanley's and the Wisconsin State Investment Board's purchases were around €250 and €150 million. JPMorgan's and Wells Fargo's purchases were relatively small, all remaining below €1 million.
Bitcoin News from Latin America
In May, there were several positive Bitcoin news stories from Latin America. El Salvador, which made Bitcoin legal tender in 2021, announced that it had mined 474 bitcoins since 2021 using geothermal energy from a volcano. El Salvador also published a Bitcoin address in May, which allows tracking the state's bitcoin holdings. El Salvador's bitcoin holdings currently exceed 5,750 bitcoins, and the holdings have been increased by at least one bitcoin every day since the end of 2022. The value of bitcoin holdings was about €360 million at the end of May. As a third piece of news, El Salvador announced the start of its first capital raising on the Bitcoin sidechain Liquid Network. This is El Salvador's first tokenized hotel investment opportunity.
In addition to El Salvador, there was news related to Argentina, one of the largest economies in South America. Genesis Digital Assets Limited, one of the world's largest Bitcoin mining companies, announced in May that it had started a partnership with the Argentine company YPF Luz. YPF Luz is a subsidiary of YPF, Argentina's state-owned electricity company. As a result of the collaboration, Bitcoin will be mined with a total of about 1,200 mining devices. Excess gas, which would otherwise be flared into the atmosphere, will be used for mining.
Positive News Related to Northcrypto's DeFi Cryptocurrencies
In May, there were positive news stories related to Northcrypto's DeFi cryptocurrencies, Chainlink and Aave. Chainlink conducted a pilot project with the securities clearing system DTCC and several large U.S. banks and asset managers. The banks and asset managers involved included well-known names such as JPMorgan, BNY Mellon, State Street, and Franklin Templeton. The purpose of the project was to create a process to bring traditional financial market data onto blockchains using Chainlink's CCIP solution. CCIP is a solution that enables, among other things, the operation of smart contracts, data transfer, and token transfers between different blockchains. The aim of the project was to accelerate the tokenization of funds.
Aave Labs, the team behind the peer-to-peer lending service Aave, announced in May a proposal for Aave's new V4 version. Aave V4 includes major improvements and expansions as well as a new visual design. The new version also aims to better integrate Aave's various features and components. Additionally, Aave V4 includes several improvements to Aave's GHO stablecoin, which tracks the U.S. dollar, with the goal of increasing GHO's popularity, which has so far remained relatively low. Aave's founder, Stani Kulechov, also mentioned plans at the end of May to release Aave Network - an Ethereum layer 2 scalability solution - after the release of V4. The release of V4 is expected to occur in about a year, according to current information.
Summary
The approval of Ethereum spot ETFs in the United States was a significant moment in Ethereum's history. ETFs make Ethereum more accessible, especially to larger masses and institutional players. It will be interesting to see how popular Ethereum ETFs become relative to similar Bitcoin ETFs when trading begins, and what impact this will have on Ethereum's price.
The announcement of the owners of the highly popular U.S. Bitcoin spot ETFs in May revealed several well-known entities. The significant entities' purchase announcements can be seen as a rather expected development, as the increasing involvement of institutional players was one of the most anticipated consequences of ETF approvals.
In May, several positive Bitcoin news stories emerged from Latin America. El Salvador, the first country that made bitcoin legal tender, has continued to make advancements related to Bitcoin on several fronts, and this trend is likely to continue in the future. The Bitcoin mining project being carried out in Argentina is very positive for Bitcoin mining and indicates a trend where state actors are becoming more interested in Bitcoin mining.
The fund tokenization project implemented by Chainlink can be seen as a significant milestone in Chainlink's history, as several of the world's most significant financial players participated in the project. Aave's announcements of the upcoming V4 version and the Aave Network release are good practical examples of Aave's continuous development. The Aave Network, in particular, will be very interesting and eagerly awaited, as many cryptocurrency experts believe that the Aave Network could become one of the largest layer 2 solutions.

Ville Viitaharju
Cryptocurrency specialist