The Breakdown

Bitcoin's price is soaring this October, driven by its typical seasonal patterns and a wave of ETF inflow momentum. Major banks like Citi and JPMorgan have made bold price predictions, further fueling market speculation. The potential impact of a government shutdown on ETF approvals is discussed, alongside new collaboration between the SEC and CFTC for better crypto oversight. Meanwhile, Kraken's $20 billion fundraising strategy raises eyebrows, and Stripe's new stablecoin initiative could shake up the market. A quirky culture clash arises as Netflix sees cancellations over Elon Musk's tweets.

October kicks off with strong momentum for Bitcoin, historically its best month. Analysts predict a potential rise to $200,000 by year-end, despite barriers like government shutdowns affecting ETF approvals. IRS guidance brings tax relief for MicroStrategy, while Stripe launches a platform for businesses to mint stablecoins. The tension between market complacency and opportunities for growth is palpable, especially as Tether's ambitions to dominate global liquidity loom large.

The U.S. government has shut down, stirring political drama and economic uncertainty. Experts discuss implications on workers as paychecks halt and analyze the potential for recession. Key cuts to Medicaid and healthcare are highlighted, alongside strategic political moves from both parties. Despite challenges, AI spending is posited as a growth driver. Meanwhile, the financial market reacts with Bitcoin resilience and gold reaching new highs. Will this shutdown be a major economic shock or a brief political spectacle?

The SEC and CFTC are collaborating after years of rivalry, signaling a shift in crypto regulation. Tensions between traditional finance and crypto sectors are highlighted, alongside debates over token fungibility standards. The significance of a recent no-action letter is dissected, revealing its impact on utility tokens. Binance's new service allows banks to use its crypto infrastructure, while SWIFT plans blockchain integration for real-time payments. The Bitcoin market's September decline is examined alongside anticipation for upcoming ETF approvals.

Kraken has secretly raised $500 million at a staggering $15 billion valuation, eyeing an IPO in 2026. The discussion delves into Tether's ambitious $500 billion fundraising plans and how it’s now considered investable thanks to clearer regulations. Speculations surrounding Tether's gold reserves spark intrigue, while the emergence of crypto treasury companies raises questions about market stability. Lastly, SEC Commissioner Hester Peirce shares her vision for a more responsible crypto regulatory environment as she bids farewell.

In this week’s Friday Five, we dive into Tether’s jaw-dropping $500B valuation bid, the SEC’s surprise innovation exemption, bipartisan momentum on a market structure bill, Ethereum’s latest Wall Street narrative, and breaking news that even Vanguard is finally letting customers buy crypto ETFs. Plus, what Bitcoin’s bloody September tells us about the cycle ahead. Enjoying this content? SUBSCRIBE to the Podcast: https://pod.link/1438693620 Watch on YouTube: https://www.youtube.com/@TheBreakdownBW Subscribe to the newsletter: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://blockworks.co/newsletter/thebreakdown⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownBW

Coinbase and Cloudflare are revolutionizing online transactions with their new X402 protocol for AI agents, enabling seamless agent-to-agent payments. Tom Lee champions Ethereum as the neutral blockchain for traditional finance, while concerns linger about the influence of large ETH holders. The showdown for financial tokenization unfolds between Ethereum and Solana, with Vitalik pushing for practical DeFi applications. Meanwhile, Michael Saylor asserts Bitcoin's pivotal role in shaping digital capital markets, hinting at a dynamic future for crypto.

Tether is looking for outside investors at an eye-popping $500 billion valuation, raising questions about its implications for the crypto market. CEO Paolo Ardoino outlines plans for expansion into stablecoins and energy. The rarity of such a valuation for crypto is explored, with comparisons to industry giants. Skepticism arises due to Tether's troubled history and ongoing legal issues. Additionally, CZ's venture fund strategy is discussed, alongside SEC efforts to streamline crypto regulations. The landscape for finance could shift dramatically depending on Tether's next moves.

Bitcoin faced a sharp 3.5% drop, leading to $1.7B in liquidations—its biggest of the year. While traders got caught off guard, long-term holders are staying put, and sentiment remains mixed. Recent large treasury buys and fluctuating ETF flows hint at a complex market landscape. Some voices are advocating for accumulation during this dip. Additionally, there’s a push to allow crypto in 401(k) plans, potentially reshaping investment strategies. As we approach Q4, the implications of these shifts are critical.

Senate Democrats are advocating for genuine bipartisan support on the critical crypto market structure bill. This push heightens the urgency as regulations loom, potentially impacting stablecoins and decentralized finance. Additionally, there are developments regarding the Treasury’s Genius Act and its stablecoin rules, alongside exciting news about Grayscale’s new crypto index fund and BitGo’s IPO filing. Tune in for insights on how these moves could shape the future of U.S. crypto regulation!