Here’s what you’ll find in today’s edition:

• BTC drops after another quiet week. We look at 13Fs and possible near-term price drivers.

• The SEC’s new crypto task force may be able to resolve this lawsuit. 

• Earnings season isn’t over yet, but other narratives have been moving markets.

BTC sinks after a quiet week. But now what?

BTC was rather quiet again last week as various narratives seem to be pulling sentiment in different directions.

We then saw the asset’s price sink below $94,000 around 1 pm ET Tuesday — down more than 3% from seven days prior.

Crypto exchange volumes reached their lowest level since the US presidential election, Compass Point analysts said in a Tuesday note. 

Last week, the US spot bitcoin ETFs had $580 million of net outflows, Farside Investors data shows — breaking a six-week inflow streak.

And yet, on the other side, we have Crypto Twitter lighting up at each sign of institutional buying. 13F filings (showing holdings of investment managers with at least $100 million AUM) have given us a glimpse into that. 

There was the Abu Dhabi sovereign wealth fund — Mubadala Investment Co. — holding $437 million of BlackRock’s iShares Bitcoin Trust (IBIT), as of Dec. 31.

Meanwhile, the state of Wisconsin reported having nearly 6.1 million shares of IBIT in Q4 — roughly double the 2.9 million shares it had held the prior quarter. 

There was also Tudor Investment Corp’s increased BTC position. The Paul Tudor Jones-founded firm upped its 4.4 million shares of IBIT held in Q3 to 8 million shares (worth $427 million) in Q4.

This reminded me of a piece I wrote early in my Blockworks career. Jones, talking about bitcoin, said on CNBC’s Squawk Box at the time: “I like the idea of investing in something that’s reliable, consistent, honest and 100% certain.”

Jones noted allocations of 5% in gold, 5% in bitcoin, 5% in cash and 5% in commodities at that point before considering other positions based on Fed actions, etc.   

The billionaire then said in October 2023 that gold and BTC “probably take on a larger percentage of your portfolio” given the macro picture and geopolitical tensions. 

So, based on past comments, Tudor’s hefty IBIT position reveal is not exactly surprising. But this bitcoin vehicle being among the firm’s largest single positions is certainly noteworthy.

Going back to price action, BTC remains well off its all-time high around $109,000.

Mike Marshall, Amberdata’s head of research, noted that liquidity is accumulating around the $95,000 mark “with smart money positioning and retail making small purchases.”  

He attributed BTC’s “quiet phase” to investors waiting for clearer economic data [and] policy and renewed market confidence. 

“Better CPI results for February and resolution of tariff uncertainty could trigger this,” Marshall noted.

BTC's recent low-volatility profile mirrors those seen in September/October 2023, as well as those in February, June and October of 2024, Compass Point’s Ed Engel and Joe Flynn argued. 

“Pronounced volatility” followed each of those four periods, they added, with price moving upward three times.

“Crypto prices often rally into the spring before declining into summer,” Engel and Flynn wrote. “BTC's [$92,000] cost basis for short-term holders still provides strong support.”

— Ben Strack

With four weeks until DAS NYC, the institutional shift into crypto is accelerating. Fund managers are positioning. How are they thinking about ETFs, tokenization, and macro risk in this new market cycle?

At DAS NYC, you’ll hear directly from the firms building their strategies around this:

• Franklin Templeton on tokenization and the next phase of asset management.

• Morgan Stanley Investment Management on how institutions are positioning in emerging markets.

• Galaxy Digital on the investment landscape and how smart money is allocating.

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📅 March 18-20 | NYC

The number of bitcoin that the company formerly known as MicroStrategy bought between Feb. 10 and Feb. 17.

Analysts shrugged off Strategy pausing its BTC buys a few weeks ago, noting they expect aggressive acquisitions to continue this year. 

We probably shouldn’t read much into this pause either, particularly after company execs recently reiterated their so-called 21-21 plan. But we’ll continue to point out Strategy’s buying activity (big, small or zero) given how much it’s bought historically (478,740 BTC in all).

One of the biggest Biden-era crypto enforcement actions may be on its way to resolution. 

The SEC last week said its new crypto task force “may affect and could facilitate the potential resolution” of the agency’s lawsuit against crypto exchange Coinbase. 

The lawsuit, first filed in 2023, was escalated to the Second Circuit last month with Coinbase’s successful motion for an interlocutory appeal. 

Basically, the SDNY (the federal court that handled SBF’s trial and many other ongoing crypto matters) decided that a higher court needs to step in to resolve a key question: Do intermediated crypto transactions involve investment contracts (i.e., transactions made on an exchange)?

If the answer to this question is yes, then that means crypto exchanges are facilitating securities transactions, which would be a problem. 

On the one hand, a ruling from the Second Circuit on this question would bring a lot more clarity to the space. One of the biggest issues with crypto regulation and enforcement today is that district court judges, sometimes even from the same district, are taking different stances. 

An appeals court ruling would provide more concrete precedent for future cases. (The caveat here is the appeals process is long and expensive. And either party could keep appealing to higher courts should things not go their way.)

On the other hand, a definitive crypto policy stance from the SEC would be even better than legal precedent. “Better,” of course, is relative here. The agency could come up with something the industry opposes. 

So lots of potential outcomes here. We’ll have to wait and see how it all shakes out.

— Casey Wagner

The “tariff trade,” or the market volatility we’ve seen the past couple of weeks as investors evaluate tariff risks, has overshadowed the tail end of earnings season. 

But many analysts still think US equities have room to go higher. 

President Trump’s threats have been delayed, not canceled. 25% tariffs on steel and aluminum tariffs are slated to start next month, and reciprocal tariffs against a range of countries are still being designed, so the news cycle — and market — are likely to take a break from focusing on duties. 

In the meantime, Big Tech stocks are just starting to recover from some post-earnings dips, but the S&P 500 is still outperforming the Magnificent Seven. 

Amazon’s web services business reported a 37% profit margin in Q4 2024 — an impressive feat, but investors weren’t sold. Shares fell more than 4% following the company’s report. 

Microsoft was a similar story. Shares had their worst day since 2022 after execs reported Q4 earnings, even though figures for earnings per share and revenue came in higher than expected. 

Google shares were down more than 8% after Alphabet missed on Q4 revenue. 

Still, Sevens Report Research founder Tom Essaye says that as long as economic data continues to stay in the “Goldilocks” range, the market should prove resilient. Should the Fed signal that this pause is likely to continue for a long while, we could be in trouble.

— Casey Wagner

• We talked about BTC’s dip. Ether was trading at $2,628 at 2 pm ET — down 4.2% from 24 hours prior.

• Blockworks’ Macauley Peterson gave an update on FTX payouts.

• Coinbase plans to offer futures contracts for Solana (SOL) and Hedera (HBAR).

• Tether co-founder Reeve Collins is working on a decentralized project called Pi Protocol that could launch this year, Bloomberg reported. This would apparently compete with USDT as a yield-bearing stablecoin.