In light of this week’s market decline, certain analysts forecast that integrating digital assets into US 401(k) retirement plans could result in billions of dollars in new inflows by autumn, possibly propelling Bitcoin to unprecedented heights.
This optimistic trend could elevate Bitcoin (BTC) above $200,000 by year-end, hinting at an influx of another $122 billion in new capital, based on a conservative 1% portfolio allocation, André Dragosch, head of European research at crypto asset management firm Bitwise, shared with Cointelegraph.
Corporate acquisitions of Bitcoin treasuries continue to draw new players, including KindlyMD, a Nasdaq-listed healthcare provider and Bitcoin treasury firm, which made its inaugural Bitcoin investment of $679 million on Tuesday.
Meanwhile, some large investors are shifting their focus from Bitcoin to betting on Ether (ETH) price increases. On Thursday, a Bitcoin whale transferred $189 million worth of BTC to the Hyperliquid decentralized exchange, largely converting it into a $295 million perpetual futures long position and a $240 million spot ETH position.
Crypto in US 401(k) retirement plans may drive Bitcoin to $200,000 in 2025
President Donald Trump set the stage for the inclusion of cryptocurrencies in US 401(k) retirement plans by signing an executive order on August 7, granting Americans the ability to access digital assets through their retirement plans.
The impact of integrating crypto into 401(k) plans could prove to be even more significant for the Bitcoin (BTC) price than the anticipated approval of US spot Bitcoin exchange-traded funds (ETFs) in January 2024, Dragosch noted.
This bullish development could be “more impactful than the US Bitcoin ETF approval itself,” indicating another $122 billion in new capital based on a conservative 1% portfolio allocation, Dragosch told Cointelegraph during the Chain Reaction daily X spaces show on Monday, also throwing in a price forecast:
“The official prediction remains $200,000 by the year’s end.”
“When looking at 401(k) and defined-contribution retirement plans in the US, the scale is enormous,” said Dragosch, emphasizing that 1% is a “relatively conservative” projection for the $12.2 trillion sector.
By incorporating digital assets into retirement plans, 401(k) portfolio managers will be able to invest in Bitcoin ETFs, potentially driving Bitcoin’s price to new all-time peaks, reinforcing Bitwise’s $200,000 Bitcoin price target for the end of 2025.
Continue reading
Kanye West YZY sniper wallet linked to $21 million LIBRA extraction scheme: Analysts
An on-chain investigation by pseudonymous analyst Dethective has traced a wallet that sniped the Kanye West-themed token YZY to another set of wallets associated with the LIBRA token, indicating a common operator extracted tens of millions of dollars from insider knowledge.
In a series of X posts on Thursday, Dethective disclosed that a YZY sniper wallet acquired $250,000 worth of tokens at merely $0.20, significantly under the price most traders paid. Within minutes, the wallet secured over $1 million in profits, later redirected into a treasury wallet.
The same treasury wallet had also received large amounts from wallets linked to LIBRA’s launch six months prior. Two “Libra sniper” wallets managed to extract a total of $21 million. Overall, nearly $23 million was accumulated from both YZY and LIBRA launches, with funds later transferred to Kamino or Binance.
“It’s evident that this individual possesses clear insider information,” Dethective asserted. “The evidence lies in the fact that they targeted only $YZY and $LIBRA and were ready with substantial quantities,” they added.
Continue reading
Bitcoin bull and billionaire files for $250 million SPAC targeting DeFi, AI
Early Bitcoin investor and billionaire Chamath Palihapitiya has filed to generate $250 million through the blank-check company “American Exceptionalism Acquisition Corp A,” aiming at the decentralized finance, AI, energy, and defense sectors.
The special purpose acquisition company (SPAC) will be led by Social Capital managing partner Steven Trieu as CEO, with Palihapitiya serving as chairman, according to the registration statement submitted to the US Securities and Exchange Commission on Monday.
The $250 million target aims to issue 25 million shares at $10 each under the ticker AEXA on the New York Stock Exchange.
Palihapitiya and Trieu are placing their bets on decentralized finance, rather than Bitcoin, as the leading force for the next wave of financial innovations, focusing on solutions that connect traditional markets with blockchain technology:
“While Mr. Palihapitiya has long advocated for Bitcoin as a hedge against inflation and an alternative to fiat currencies, we anticipate that the next phase of evolution will be a greater integration between conventional finance and decentralized finance.”
Continue reading
Ex-White House crypto director Bo Hines takes Tether advisory role
The stablecoin giant Tether has recruited former White House Crypto Council Executive Director Bo Hines as its new strategic adviser for digital assets and US strategy, marking a move to deepen its presence in the world’s largest economy.
Tether, which issues the USDt (USDT) stablecoin, appointed Hines to directly oversee and coordinate the company’s US strategy and expansion, effective immediately, according to a Tuesday announcement shared with Cointelegraph.
Hines previously held a position in President Donald Trump’s administration, where he contributed to fostering digital asset innovation, establishing regulations for stablecoin issuers, and promoting collaboration between the government and blockchain industry.
In his new capacity, Hines will collaborate with Tether’s leadership team to advance the company’s US market entry and cultivate “constructive relationships” with policymakers and industry stakeholders.
Hines’ “extensive knowledge of the legislative process, coupled with his enthusiasm for practical blockchain adoption, renders him an invaluable asset as Tether ventures into the largest market globally,” stated Paolo Ardoino, CEO of Tether, adding:
“Bo’s appointment reflects our commitment to establishing a robust U.S.-based presence that spans various sectors, beginning with digital assets and extending to new prospects, including a strong emphasis on potential further investments in domestic infrastructure.”
Tether Investments has already reinvested nearly $5 billion into the US economy. Hines’ addition aims to “reinforce” this commitment to and alignment with the US market, according to the announcement.
Continue reading
Ethena crosses $500 million in cumulative revenue as synthetic stablecoins gain ground
Ethena Labs announced on Thursday that its Ethena protocol has generated over $500 million in cumulative revenue. The increase in both revenue and the circulating supply of its synthetic stablecoin, Ethena USDe (USDe), has accelerated since July as synthetic stablecoins grow in market share.
Ethena Labs shared the news in a post on X, revealing that in the last week, protocol revenue reached $13.4 million and USDe supply peaked at an all-time high of $11.7 billion.
“Ethena’s revenue has surged due to robust inflows into USDe and favorable market conditions that have enhanced returns from its delta-neutral hedging reserve model,” an Ethena Labs spokesperson told Cointelegraph. “The protocol’s momentum reflects the growing demand for and trust in USDe as a store of value.”
According to decentralized finance analytics platform DefiLlama, Ethena USDe currently holds the third-largest market capitalization among all stablecoins. It also claims the top market capitalization among synthetic stablecoins. In the past month, Ethena USDe’s market cap has escalated by 86.6%.
Alongside Ethena USDe, other synthetic stablecoins are gaining traction and market share. Sky Dollar (USDS), which powers the Sky ecosystem and is an upgraded version of DAI (DAI), has witnessed a 14% rise in market cap. Falcon USD (USDf), a synthetic dollar introduced by Falcon Finance, has experienced its market cap surge by 89.4%.
Synthetic stablecoins present both advantages and risks. Though they are not collateralized by tangible assets, they may entail lower transaction costs. However, there remains a danger of instability and depegging, which could lead to considerable investor losses.
Continue reading
DeFi market overview
According to data from Cointelegraph Markets Pro and TradingView, the majority of the 100 largest cryptocurrencies by market capitalization concluded the week in the negative.
The memecoin launch platform Pump.fun’s (PUMP) token dropped by over 22%, marking the most significant decline of the week, followed by the SPX6900 (SPX) token, which fell by over 18%.
We appreciate your reading our summary of the most influential DeFi developments of the week. Join us next Friday for more stories, insights, and education regarding this dynamically evolving space.
