The longtime whale of Bitcoin (BTC), once the fiercest champion of self-control, may be losing some of its grip on the market as more people move into the comforts of traditional finance. Earlier this week, BlackRock executives revealed that some early Bitcoin holders were secretly exchanging some of their spot positions into exchange-traded funds (ETFs), gaining access to a broader range of asset management tools in the process.
While ETFs and spot Bitcoin have traditionally served different audiences, on-chain data suggests the rise of spot ETFs may have come at the expense of self-custody. According to analyst Willy Wu, the volume of self-custodial Bitcoin recently broke a 15-year upward trend as ETF adoption accelerates.
This week on Crypto Biz, we look at Bitcoin whales’ conversion to TradFi, Ripple’s latest public market efforts, Galaxy Digital’s outstanding Q3 earnings, and Wise’s stablecoin expansion potential.
Bitcoin Whales Are Accepting TradFi
Some early Bitcoin adopters who have amassed large holdings over the years are now exchanging their spot positions with BlackRock’s Bitcoin ETF. This move means gaining access to the traditional financial system while giving up control of private keys.
Robbie Mitchnick, head of digital assets at BlackRock, said the asset manager has already facilitated more than $3 billion worth of such transformations. He said many early Bitcoin holders recognized “the convenience of being able to maintain exposure within existing relationships with financial advisors and private banks.”
Mitchnick added that this change has been accelerated by recent U.S. Securities and Exchange Commission rule changes that allow in-kind creation and redemption of Bitcoin ETFs, allowing funds to exchange ETF shares directly for Bitcoin instead of cash.
Meanwhile, BlackRock’s iShares Bitcoin Trust (IBIT) remains the dominant player in the spot Bitcoin ETF market with over $88 billion in net assets.
Ripple-backed Evernorth goes public, building XRP treasury
Ripple Institute-backed digital asset firm Evernorth Holdings plans to go public through a merger with Armada Acquisition Corporation II, paving the way for the creation of a new financial company specializing in XRP (XRP).
The deal is expected to generate proceeds of more than $1 billion, including a $200 million investment from Japan’s SBI Holdings. Additional support comes from Ripple, Kraken, Pantera Capital, and GSR. Upon completion, the new entity will trade on the Nasdaq under the ticker symbol XRPN.
CEO Asheesh Birla said the company aims to “accelerate the adoption of XRP” as interest in digital asset vaults grows. However, some analysts have warned that these bonds could face headwinds as altcoin prices continue to lag.
“Toxic funding, failed altcoins being renamed DAT, too many failed companies with no plan or vision. Things are in complete disarray,” said David Bailey, CEO of Bitcoin treasury firm Nakamoto.
Galaxy Digital benefits from bull market and institutional adoption
Asset manager Galaxy Digital reported strong third-quarter profits, driven by increased trading activity and growing institutional demand for crypto financial services, including facilitating a whopping 80,000 BTC for private clients.
The company reported net income of $505 million and adjusted profit of $629 million for the quarter, driven by increased digital asset management and investments. Galaxy currently has $3.2 billion in equity, including $1.9 billion in cash and stablecoins, and overall trading volume increased 140% from the previous quarter.
As reported by Cointelegraph, Galaxy processed customer sales of 80,000 BTC in July (worth around $9 billion at the time). The asset manager described this as part of the investor’s “broader estate planning strategy”.
Wise may be planning to roll out a stablecoin
Global payments and currency exchange platform Wise appears to be exploring stablecoin-based products as the $10 billion fintech hires a head of stablecoin-focused digital asset products.
Matthew Salisbury, product director at Wise, announced the London-based role aimed at supporting the company’s expansion into digital assets in a post on LinkedIn. The list states that the ideal candidate should have experience with B2C products in the digital assets space.
“If you are building a wallet or payment solution based on a stablecoin and would like to run it on Wise, please apply through an ad or send me a DM,” Salisbury wrote.
Stablecoins could be a natural evolution for the London-based company, best known for its low-cost international money transfers. Wise currently supports sending money to over 160 countries.
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